EMARINE GLOBAL INC. - FORM 10-Q - May 20, 2014

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-Q

(Mark One)

x   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2014

o   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to _______________.

Commission file number: 000-49933
 
Pollex, Inc.
(Exact name of registrant as specified in its charter)

Nevada
(State or other jurisdiction of incorporation or organization)
95-4886472
(I.R.S. Employer Identification No.)
   
2005 De La Cruz Blvd. Suite 235
Santa Clara, CA
(Address of principal executive offices)
 
95050
(Zip Code)

Registrant’s telephone number, including area code (408) 350-7340

(Former name, former address and former fiscal year, if changed since last report.)
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x       No o
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). x Yes □ No.
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act (Check one):

Large accelerated filer o
Accelerated filer o
   
Non-accelerated filer o
Smaller reporting company x
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o   No x
 
Applicable only to corporate issuers:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of May 15, 2014, there were 5,121,688 shares of common stock, par value $0.001, issued and outstanding.
 
  
POLLEX, INC.


 
 
 
 

 


This Quarterly Report includes forward-looking statements within the meaning of the Securities Exchange Act of 1934 (the “Exchange Act”). These statements are based on management’s beliefs and assumptions, and on information currently available to management. Forward-looking statements include the information concerning our possible or assumed future results of operations set forth under the heading “Management’s Discussion and Analysis of Financial Condition or Plan of Operation.” Forward-looking statements also include statements in which words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “consider” or similar expressions are used.

Forward-looking statements are not guarantees of future performance. They involve risks, uncertainties and assumptions. Our future results and shareholder values may differ materially from those expressed in these forward-looking statements. Readers are cautioned not to put undue reliance on any forward-looking statements.
 

 
 
 
 
ITEM 1 Financial Statements
 
POLLEX, INC.
BALANCE SHEETS
 
 
 
   
March 31,
    
December 31,
  
   
2014
    
2013
  
   
(Unaudited)
        
             
 ASSETS
            
             
 CURRENT ASSET
            
 Cash and cash equivalents
   $ 1,996     $ 4,745  
 Total current asset
     1,996       4,745  
                 
 Property and equipment, net of accumulated
                
      depreciation of $10,397 and $10,291, at March 31, 2014 and
                
      December 31, 2013, respectively
     82       188  
                 
 License agreements, net of accumulated amortization of
                
     $47,500 and $42,500 at March 31, 2014 and
                
 December 31, 2013, respectively
     75,000       80,000  
                 
 Other asset- Deposit
     1,300       1,300  
                 
Total Assets
   $ 78,378     $ 86,233  
                 
LIABILITIES AND STOCKHOLDERS' DEFICIT
  
                 
 CURRENT LIABILITIES
                
 Accrued expenses and accounts payable
   $ 843,295     $ 835,406  
 Amounts due to affiliate under service agreement
     831,000       771,000  
 Advances from affiliate
     316,977       333,277  
 Loans payable
     1,215,799       1,160,403  
                 
Total Current Liabilities
     3,207,071       3,100,086  
                 
 Stockholders' Deficit
                
 Common stock, authorized 300,000,000 shares;
                
   par value $0.001; 5,121,688 issued and outstanding
                
   at March 31, 2014 and December 31, 2013, respectively
     5,120       5,120  
 Additional paid-in capital
     136,894,861       136,874,861  
 Accumulated deficit
     (140,028,674 )     (139,893,834 )
                 
Total Stockholders’ Deficit
     (3,128,693 )     (3,013,853 )
                 
Total Liabilities and Stockholders’ Deficit
   $ 78,378     $ 86,233  
                 
 
See accompanying notes to financial statements.
 
 
 
POLLEX, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
 
 
      For the three months ended  
      March 31,  
   
2014
    
2013
  
             
REVENUES
   $ 18,826     $ 33,698  
                 
COSTS AND  EXPENSES
                
Cost of services
     586       9,336  
Selling, general and administrative
     70,806       27,865  
Related party service agreement
     60,000       60,000  
Bad debt expense
    -       11,669  
Depreciation and amortization
     5,106       9,102  
         Total Costs and Expenses
     136,498       117,972  
                 
OPERATING LOSS
     (117,672 )     (84,274 )
                 
OTHER EXPENSE
                
Interest expense
     (17,168 )     (19,222 )
        Total Other Expense
     (17,168 )     (19,222 )
                 
LOSS BEFORE INCOME TAXES
     (134,840 )     (103,496 )
                 
PROVISION FOR INCOME TAXES
     -       -  
                 
NET LOSS
   $ (134,840 )   $ (103,496 )
                 
NET LOSS PER COMMON SHARE (Basic and Diluted)
   $ (0.03 )   $ (0.02 )
                 
WEIGHTED AVERAGE SHARES
                
    OUTSTANDING
     5,121,688       5,121,688  
                 
 
 
See accompanying notes to financial statements.
 
 
 
 
POLLEX, INC.
STATEMENTS OF CASH FLOWS
(UNAUDITED)
 
      For the three months ended  
    March 31,  
   
2014
    
2013
  
             
CASH FLOWS FROM OPERATING ACTIVITIES
            
Net loss
   $ (134,840 )   $ (103,496 )
Adjustments to reconcile net loss to net cash
                
      used in operating activities:
                
Depreciation and amortization
     5,106       9,102  
Bad debt expense
     -       11,669  
Contributed services      20,000       -  
    Changes in assets and liabilities:
                
(Increase) decrease in accounts receivable
     (708 )     (11,669 )
Increase (decrease) in accrued expenses
     7,889       (16,217 )
Increase (decrease) in amounts due affiliate under service agreement
     60,000       60,000  
                 
Net cash used in operating activities
     (42,553 )     (50,611 )
                 
CASH FLOWS FROM INVESTING ACTIVITIES
                
Purchase of property and equipment
     -       -  
Acquisition of license agreements
     -       -  
                 
Net cash used in investing activities
     -       -  
                 
CASH FLOWS FROM FINANCING ACTIVITIES
                
    Proceeds from advance from affiliate
     23,700       60,000  
    Repayment of advance from affiliate
     (40,000 )     -  
    Loan proceeds
     85,000       -  
Repayment of loan
     (28,896 )     -  
                 
            Net cash provided by financing activities
     39,804       60,000  
                 
            Net increase (decrease) in cash
     (2,749 )     9,389  
                 
CASH AT BEGINNING OF PERIOD
     4,745       3,836  
 
                
CASH AT END OF PERIOD
   $ 1,996     $ 13,225  
                 
SUPPLEMENTAL CASH FLOW DISCLOSURES:
                
    Cash paid for interest
   $ -     $ -  
    Cash paid for taxes
   $ -     $ -  
                 
    Assumption of accounts receivable by lender
   $ 708     $ -  
                 
 
                
                 
 
See accompanying notes to financial statements.
 
 
 
 
POLLEX, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2014
(UNAUDITED)


NOTE A – BASIS OF PRESENTATION

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary in order to make the financial statements not misleading have been included. Results for the three months ended March 31, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. For further information, refer to the financial statements and footnotes thereto included in the Pollex, Inc. annual report on Form 10-K for the year ended December 31, 2013.

NOTE B – GOING CONCERN

As shown in the accompanying financial statements, the Company incurred net losses of $134,840 and $103,496 for the three months ended March 31, 2014 and 2013, respectively, and has an accumulated deficit of $140,028,674 at March 31, 2014.  In order to fund future operations, the Company will need to raise capital through the equity markets and generate revenue through its license agreements. Failure to raise adequate capital and generate adequate sales revenues could result in the Company having to curtail or cease operations.  Additionally, even if the Company does raise sufficient capital to support its operating expenses and generate adequate revenues, there can be no assurances that the revenue will be sufficient to enable it to develop business to a level where it will generate profits and cash flows from operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern. However, the accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

NOTE C – LICENSE AGREEMENTS

The Company began operating the online game, The Great Merchant, in open beta testing in January 2010. During the three months ended March 31, 2014 and 2013, the Company generated revenues of $18,118 and $22,300, respectively, from this beta testing.

The Company has acquired license agreements for online games for use in South Korea comprised as follows:
 
    March 31,     December 31,   Estimated
   
2014
    
2013
  
Useful Life
License agreements
   $ 122,500     $ 122,500  
2-3 years
Accumulated amortization
     (47,500 )     (42,500 )  
    $ 75,000     $ 80,000    

Amortization expense was $5,000 and $2,320 for the three months ended March 31, 2014 and 2013, respectively.
 
Each license also has a royalty fee which varies for each license. The licenses have terms of 2 to 3 years, beginning when they are launched commercially.  Under the license agreements, the Company is required to pay the licensor 24%- 25% of gross sales.




POLLEX, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2014
(UNAUDITED)


NOTE C – LICENSE AGREEMENTS (Continued)

The Company engaged a Korea-based service provider to support and maintain the online game, and collect payments from customers. Under this agreement the service provider is required to pay the Company 29% of the gross sales on the contracted games. For the three months ended March 31, 2014 and 2013, the Company billed such 29%, or $708 and $11,668, respectively.  For the three months ended March 31, 2014 and 2013, the Company was billed $586 and $9,336, respectively, by the licensor on these games.

At December 31, 2013, a note holder agreed to assume the amounts due from the Korea-based service provider, up to $150,000. As such, the Company reduced the note by $708 and $138,897 at March 31, 2014 and December 31, 2013, respectively.

NOTE D – RELATED PARTY TRANSACTIONS

Certain expenses have been paid on behalf of the Company by Joytoto Co., Ltd (“Joytoto Korea”), of which the Company is a majority owned subsidiary. The Company has recognized the expenses and corresponding payable to Joytoto Korea as due to affiliate. The advances are non-interest bearing and have no specific repayment date. During the three months ended March 31, 2014, the Company received proceeds of $23,700 and repaid $40,000. During the three months ended March 31, 2013, the Company received proceeds of $60,000.

The Company has entered into a Service Agreement with Gameforyou, Incorporated, a wholly-owned subsidiary of Joytoto Korea. Under this agreement, Gameforyou, Incorporated provides translation, customer support, and system operations and maintenance. The Company is required to pay Gameforyou, Incorporated $10,000 in cash and $10,000 in cash or stock each month. Any issuance of stock will be at the market value or at a price determined and agreed to by both parties. For the three months ended March 31, 2014 and 2013, $60,000 and $60,000, respectively, were recognized in the Statement of Operations under this agreement. At March 31, 2014 and December 31, 2013, $831,000 and $771,000, respectively were due to Gameforyou, Incorporated.

NOTE E – LOANS PAYABLE

The loans payable consists of borrowings from two notes. The terms of the promissory notes are one year and bear interest at an annual rate of 6% and are unsecured. The notes may be repaid at any time prior to its due date without a prepayment penalty. Of the notes, $1,130,799 are in default at March 31, 2014 and $85,000 are due March 31, 2015.

At December 31, 2013, one of the note holders agreed to assume the amounts due from the Korea-based service provider, up to $150,000. As such, the Company reduced the note by $708 and $138,897 at March 31, 2014 and December 31, 2013, respectively.

During the three months ended March 31, 2014, the Company received proceeds of $85,000 and repaid $28,896.

NOTE F - INCOME TAXES

At March 31, 2014 and December 31, 2013, the Company had unused net operating loss carryforwards of approximately $5,877,000 and $5,742,000, respectively, for income tax purposes, which expire between 2027 and 2034. The net operating loss carryforwards may result in future income tax benefits of approximately $1,998,000 and $1,952,000, respectively; however because realization is uncertain at this time, a valuation reserve in the same amount has been established. Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.
 
 
 
POLLEX, INC.
NOTES TO FINANCIAL STATEMENTS
March 31, 2014
 
NOTE F - INCOME TAXES (Continued)
 
Significant components of the Company’s deferred tax liabilities and assets as of March 31, 2014 and December 31, 2013 are as follows:
 
   
March 31,
    
December 31,
  
   
2014
    
2013
  
Deferred tax liabilities
   $ -     $ -  
                 
Deferred tax asset-
                
    Net operating loss carryforward
     2,037,000       1,952,000  
    Valuation allowance
     (2,037,000 )     (1,952,000 )
    Net deferred tax asset
   $ -     $ -  
 
The income tax expense (benefit) differs from the amount computed by applying the United States statutory corporate income tax rate as follows:
 
   
March 31,
  
   
2014
    
2013
  
U.S statutory income tax rate
     34 %     34 %
Change in valuation allowance of deferred tax assets
     (34 %)     (34 %)
    Net deferred tax asset
     - %     - %
 
NOTE G – WARRANTS

Warrant activity for the three months ended March 31, 2014 is as follows:
   
Shares
    
Weighted
Average
Grant Date
Fair Value
  
Outstanding, January 1, 2014
    
946,667
    
$
41.46
  
Granted
    
-
      
-
  
Forfeited
    
-
      
-
  
Expired
    
-
      
-
  
Exercised
    
-
      
-
  
Outstanding, March 31, 2014
    
946,667
    
$
41.46
  

The weighted average remaining contractual life and exercise price of the warrants outstanding and exercisable at March 31, 2014 was 0.59 years and $4.95, respectively. The warrants outstanding had no intrinsic value at March 31,2014.
 
NOTE F- EMPLOYMENT AGREEMENTS

 On March 21, 2014, the Company entered into three year employment agreement Seong Sam Cho, to serve as Chief Executive Officer, President and Chairman for an annual salary of $1.00.
 
For the three months ended March 31, 2014, the Company recorded $20,000 for the fair value of the services contributed by Seong Sam Cho.
 
 
 
ITEM 2     Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Our Management’s Discussion and Analysis contains not only statements that are historical facts, but also statements that are forward-looking. Forward-looking statements are, by their very nature, uncertain and risky. These risks and uncertainties include, but are not limited to, international, national and local general economic and market conditions; demographic changes; our ability to sustain, manage, or forecast growth; our ability to successfully make and integrate acquisitions; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; and other risks that might be detailed from time to time in our filings with the Securities and Exchange Commission.

Although the forward-looking statements in this Quarterly Report reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by them. Consequently, and because forward-looking statements are inherently subject to risks and uncertainties, the actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. You are urged to carefully review and consider the various disclosures made by us in this report and in our other reports as we attempt to advise interested parties of the risks and factors that may affect our business, financial condition, and results of operations and prospects.

Overview
 
Pollex, Inc., formerly Joytoto USA, Inc., formerly BioStem, Inc. (the “Company,” “we,” and “us”) was incorporated on November 2, 2001, in the State of Nevada, under the name “Web Views Corporation”.
 
              We are a majority owned subsidiary of Joytoto Co., Ltd. (“Joytoto Korea”). We are determined to focus our efforts on our Online Games business by acquiring new game licenses and making such games commercially available in South Korea and the United States.
 
             Our operations are focused on Online Games. We have acquired licenses from various online game developers to use in South Korea. Our Online Games business segment has generated $18,118 for the three months ended March 31, 2014.
 
  As of March 31, 2014, the Company entered into license agreements for 15 games for use in South Korea. These agreements allow the Company to release and service these games in South Korea.  The Company opened one of these games in South Korea under open beta testing on March 16, 2011. Open Beta testing allows users and players to test the game while not implementing the full revenue generating service of the game.  One of the games was launched commercially in July 14, 2012.   The remainder of the games are expected to be launched in consecutive succession in the third quarter of 2014.
 
The Company engaged a Korea-based service provider to support and maintain the online game and collect payments from customers. Under this agreement, the service provider is required to pay the Company 29% of gross sales.  For the three months ended March 31, 2014, the Company billed 29%, or $708.  The remaining revenues were generated from the Company's online game, the Great Merchant, which has been in service since 2010.
 
Revenues, Expenses and Loss from Operations
 
 Three months ended March 31, 2014 compared to three months ended March 31, 2013
 
Our revenues, selling, general and administrative expenses, depreciation, amortization, total costs and expenses, and net loss for the three months ended March 31, 2014 and for the three months ended March 31, 2013 are as follows:
 
   
Three Months
Ended 
March 31, 2014
    
Three Months
Ended 
March 31, 2013
  
             
Revenue
  
$
18,826
    
$
33,698
  
Cost of services
    
586
      
9,336
  
Selling, general and administrative
    
70,806
      
27,865
  
Related party service agreement
    
60,000
      
60,000
  
Bad debt expense
    
-
      
11,669
  
Depreciation and amortization
    
5,106
      
9,102
  
Total costs and expenses
    
136,498
      
117,972
  
Other expense - interest expense
    
17,168
      
19,222
  
Net Loss
  
$
(134,840
 )  
$
(103,496
 )

 
 
 
For the three months ended March 31, 2014, we generated $18,826 in revenue compared to $33,698 for the three months ended March 31, 2013.  The decrease of $14,872 or 44% was primarily due to less revenue generated from our online games.
 
The costs of services represent the Company's payments to the licensor for the online games which are active. These games began operating in the third quarter of 2012.
 
            For the three months ended March 31, 2014, our selling, general and administrative expenses of $70,806 consisted primarily of $17,189 in professional fees, $20,000 in contributed services and $20,520 in office expense.  For the three months ended March 31, 2013, our selling, general and administrative expenses of $27,865 consisted primarily of $18,686 in professional fees.  The increase of $22,941or 45% was primarily due to increase in office equipment purchases.
 
The related party service agreement is for services provided by a related party for game translation, customer support, and system operations and maintenance. The Company is required to pay $10,000 in cash and $10,000 in cash or stock each month.
 
Depreciation is of computers and other office furniture and equipment. The amortization relates to the in service license agreements.  The impairment of the license agreements relates to the cancellation of the game licenses discussed above.
 
 For the three months ended March 31, 2014, we had $136,498 in total costs and expenses compared to $117,972 for the three months ended March 31, 2013.  The increase of $18,526 or 16% was primarily due to less bad debt expense and cost of services, offset by an increase in office expenses.
 
Other Expenses for the three months ended March 31, 2014 consisted of interest expense of $17,168. Other Expenses for the three months ended March 31, 2013 consisted of interest expense of $19,222. The decrease of $2,054 or 11% was primarily due to decrease in interest expense, due to a decrease in loan balances from March 31,2013.
 
Net Loss
 
 Our Net Loss for the three months ended March 31, 2014 was $134,840 compared to $103,496 for the three months ended March 31, 2013.  The decrease of $31,344 or 30% was primarily due to decrease in total costs and expense and less interest expense.
 
Liquidity and Capital Resources
 
 Introduction
 
 Our primary assets are cash and the online game license agreements.
 
During the three months ended March 31, 2014, our online games business segment generated $18,286 in total revenues while in its commercial service. We have begun to generate revenue from our other license agreements.
 
Our cash requirements have been relatively small up to this point, but we anticipate that our cash needs will increase dramatically. We anticipate satisfying these cash needs through the sale of our common stock until we can generate enough revenue to sustain our operations.
 
   
As of
March 31, 2014
    
As of
December 31,
2013
    
Change
  
Cash
  
$
1,996
    
$
4,745
    
$
(2,749)
  
Property and equipment, net of accumulated depreciation of $10,397 and $10,291 at March 31, 2014 and December 31, 2013 respectively
    
82
      
188
      
(106)
  
License Agreements, net of accumulated amortization of $47,500 and $42,500 at March 31, 2014 and December 31, 2013, respectively
    
75,000
      
80,000
      
(5,000)
  
Deposits
    
1,300
      
1,300
      
0
  
Total assets
    
78,378
      
86,233
      
(7,855)
  
Accrued expenses and accounts payable
    
843,295
      
835,406
      
7,889
  
Due to affiliate
    
831,000
      
771,000
      
60,000
  
Advances from affiliate
    
316,977
      
333,277
      
(16,300)
  
Loans payable
    
1,215,799
      
1,160,403
      
55,396
  
Total Current Liabilities
    
3,207,071
      
3,100,086
      
106,985
  
 
 
 
Cash Requirements
 
As stated above, we anticipate that our cash requirements will increase substantially as we begin to increase operations to generate revenue from our license agreements.
 
Sources and Uses of Cash
 
Operations
 
For the three months ended March 31, 2014 we had a net loss of $134,840 compared to $103,496 for the three months ended March 31, 2013.  This was offset by depreciation and amortization of $5,106 contributed services of $20,000, an increase in accrued expenses of $7,889, an increase in amounts due to affiliate under service agreement of $60,000 for total cash used in our operating activities of $42,553.
 
 Investments
 
We had no cash used in investment activities for the three months ended March 31, 2014.
 
We had no cash used in investment activities for the three months ended March 31, 2013.
 
 Financing
 
For the three months ended March 31, 2014, our cash flows from financing activities totaled $39,804 from an advance from an affiliate of $23,700, loan proceeds of $85,000 offset by loan repayments of $28,896 and offset by repayment of advance from affiliate of $40,000.
 
For the three months ended March 31, 2013, our cash flows from financing activities totaled $60,000 from an advance from an affiliate.
 
 Critical Accounting Policies
 
The discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. In consultation with our board of directors, we have identified the following accounting policies that we believe are key to an understanding of our financial statements. These are important accounting policies that require management’s most difficult, subjective judgments.
 
 Valuation of License Agreements
 
As of March 31, 2014, the Company has entered into license agreements for games for use in South Korea. These agreements allow the Company to release and service these games in South Korea.  The Company opened one of these games in South Korea under open beta testing on March 16, 2011. Open Beta testing allows users and players to test the game while not implementing the full revenue generating service of the game.  One of the games was launched commercially on July 14, 2012.   The remainder of the games are expected to be launched in consecutive succession in the third quarter of 2014.

For the game licenses, the Company was required to pay aggregate license fees of $122,500, ranging from $0 to $30,000 per game.  

The Company engaged a Korea-based service provider to support and maintain the online game and collect payments from customers. Under this agreement, the service provider is required to pay the Company 29% of gross sales. For the three months ended March 31, 2014 and 2013, the Company billed such 29%, or $708 and $11,668, respectively. 

 Revenue Recognition

Revenues are recognized when all of the following criteria have been met: persuasive evidence for an arrangement exists; delivery has occurred or services have been rendered; the fee is fixed or determinable; and collectability is reasonably assured.

 Off-balance Sheet Arrangements

We have no off-balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is deemed by our management to be material to investors.
 
 
ITEM 3     Quantitative and Qualitative Disclosures About Market Risk

Not applicable.
 

Evaluation of Disclosure Controls and Procedures

We conducted an evaluation, with the participation of our Chief Executive Officer, who is also our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, as of March 31, 2014 to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities Exchange Commission's rules and forms, including to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on that evaluation, our Chief Executive Officer concluded that as of March 31, 2014, our disclosure controls and procedures were not effective at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
 
 
 
PART II – OTHER INFORMATION

Legal Proceedings

None.
 
Risk Factors
 
There are no material changes to the risk factors in our most recent Annual Report on Form 10-K.

Unregistered Sales of Equity Securities and Use of Proceeds
 
None.

Defaults Upon Senior Securities

None.
 
Mine Safety Disclosures.

Not applicable.

Other Information

None.
 
Exhibits
 
 
     
     
 
     
     
101
  
The following materials from Pollex, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014 are formatted in XBRL (eXtensible Business Reporting Language):  (i) the Consolidated Statements of Income, (ii) the Consolidated Statements of Cash Flow, (iii) the Consolidated Balance Sheets, and (iv) Notes to Consolidated Financial Statements tagged as blocks of text.
 
EX-101.INS
  
XBRL INSTANCE DOCUMENT
     
EX-101.SCH
  
XBRL TAXONOMY EXTENSION SCHEMA DOCUMENT
     
EX-101.CAL
  
XBRL TAXONOMY EXTENSION CALCULATION LINKBASE
     
EX-101.DEF
  
XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
     
EX-101.LAB
  
XBRL TAXONOMY EXTENSION LABELS LINKBASE
     
EX-101.PRE
  
XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE
 
  

 
  SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
 
Pollex, Inc.
  
       
May 20, 2014 
      
 
By:
/s/Seong Sam Cho
  
   
Seong Sam Cho
  
   
Its: President, Chief Executive Officer and Chief Financial Officer (Principal Executive Officer and Principal Financial and Accounting Officer)
  
       
       

 
 
 
14
 

EMARINE GLOBAL INC. Reports