Solo International, Inc - FORM 10-Q

Attached files

file	filename
EXCEL - IDEA: XBRL DOCUMENT - Solo International, Inc	Financial_Report.xls
EX-31.2 - CERTIFICATION - Solo International, Inc	ex312.htm
EX-32.1 - CERTIFICATION - Solo International, Inc	ex321.htm
EX-31.1 - CERTIFICATION - Solo International, Inc	ex311.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended March 31, 2014

o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934

For the transition period from ______ to _______

Commission File Number 000-55137

SOLO INTERNATIONAL, INC.

(Name of small business issuer in its charter)

Nevada		68-0680819
(State of incorporation)		(I.R.S. Employer Identification No.)

871 Coronado Center Drive, Suite 200, Henderson, NV 89052

(Address of principal executive offices)

(702) 330-3285

(Registrant’s telephone number)

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 [ ]

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).

Yes [ ]

No [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	[ ]	Accelerated filer	[ ]

Non-accelerated filer	[ ]	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 [ ]

No [X]

As of May 16, 2014, there were 288,200,000 shares of the registrant’s $0.001 par value common stock issued and outstanding.

SOLO INTERNATIONAL, INC. *

TABLE OF CONTENTS


		Page

PART I. FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS	4
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	5
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	8
ITEM 4.	CONTROLS AND PROCEDURES	8

PART II. OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS	9
ITEM 1A.	RISK FACTORS	9
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	9
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	9
ITEM 4.	MINE SAFETY DISCLOSURES	9
ITEM 5.	OTHER INFORMATION	9
ITEM 6.	EXHIBITS	10
	SIGNATURES	11

Special Note Regarding Forward-Looking Statements

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Solo International, Inc. (the “Company”), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

*Please note that throughout this Quarterly Report, and unless otherwise noted, the words "we," "our," "us," “SLIO,” “SOLO,” the "Company," refers to Solo International, Inc.

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

Consolidated Financial Statements

(Expressed in US dollars)

March 31, 2014

Financial Statement Index		Page

Consolidated Balance Sheets (unaudited)		F-1

Consolidated Statements of Operations (unaudited)		F-2

Consolidated Statements of Changes in Stockholder's Deficiency (unaudited)		F-3

Consolidated Statements of Cash Flows (unaudited)		F-4

Notes to the Consolidated Financial Statements (unaudited)		F-5 to F-17

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

CONSOLIDATED BALANCE SHEETS

	March 31, 2014 (unaudited)			September 30, 2013 (audited)
ASSETS
Current
Cash	$	199		$	-
Prepaid expense		4,298			1,097
Total Current Assets		4,497			1,097
Total Assets	$	4,497		$	1,097

LIABILTIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY)
Current liabilities
Accounts payable and accrued liabilities	$	132,211		$	113,006
Accounts payable and accrued liabilities, related party		-			2,500
Advances from related parties		6,417			6,417
Convertible promissory notes, net (Note 5)		549,910			503,670
Derivative liabilities		70,190			-
Total Current Liabilities		758,728			625,593

STOCKHOLDERS’ EQUITY (DEFICIENCY)
Common stock: 900,000,000 shares authorized, at $0.001 par value 288,200,000 shares issued and outstanding as at March 31, 2014 and September 30, 2013		288,200			288,200
Capital in excess of par value		48,157			48,157
Deficit accumulated during the exploration stage		(1,090,588	)		(960,853	)
Total Stockholders’ Equity (Deficiency)		(754,231	)		(624,496	)
Total Liabilities and Stockholders’ Equity (Deficiency)	$	4,497		$	1,097

The accompanying notes are an integral part of these consolidated financial statements.

F-1

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS

For the six month periods ended March 31, 2014 and 2013

and for the period from

April 30, 2010 (date of inception) to March 31, 2014

(Unaudited)

	Three months ended March 31,						Six months ended March 31,						April 30, 2010 (date of inception) to March 31,
	2014			2013			2014			2013			2014

REVENUE	$	-		$	-		$	-		$	-		$	-

EXPENSES
Exploration expenses		-			-			-			13,753			35,445
Professional fees		11,738			19,259			30,960			33,981			172,608
Management fees		7,500			7,500			18,500			15,000			81,000
Impairment on mineral claims		-			-			-			-			225,000
Other general and administrative expenses		2,338			22,392			11,277			47,147			149,252
OPERATING LOSS		(21,576	)		(49,151	)		(60,737	)		(109,881	)		(663,305	)

OTHER INCOME (EXPENSES)
Change in fair value of derivative liabilities		2,440			-			2,440			-			2,440
Interest expenses		(40,628	)		(50,623	)		(71,438	)		(119,449	)		(429,723	)

NET LOSS		(59,764	)		(99,774	)		(129,735	)		(229,330	)		(1,090,588	)

Basic and diluted loss per share	$	(0.00	)*	$	(0.00	)*		(0.00	)*		(0.00	)*

Weighted average number of shares outstanding, basic and diluted		288,200,000			288,200,000			288,200,000			288,200,000

*	Less than $0.01 per share

The accompanying notes are an integral part of these consolidated financial statements.

F-2

SOLO INTERNATIONAL, INC,

(An Exploration Stage Company)

STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIENCY

For the Period from April 30, 2010 (date of inception) to March 31, 2014

										Accumulated
										Deficit
							Capital in			During the
	Common Stock						Excess of			development
	Shares			Amount			Par value			Stage			Total
Balance April 30, 2010		-		$	-		$	-		$	-		$	-
Issuance of common shares for cash		300,000,000			300,000			(297,000	)		-			3,000
Issuance of common shares for cash		72,000,000			72,000			(57,600	)		-			14,400
Issuance of common shares for cash		16,000,000			16,000			(11,200	)		-			4,800
Net loss for the period		-			-			-			(714	)		(714	)
Balance, September 30, 2010		388,000,000			388,000			(365,800	)		(714	)		21,486
Net loss for the year ended September 30, 2011		-			-			-			(25,360	)		(25,360	)
Balance, September 30, 2011		388,000,000			388,000			(365,800	)		(26,074	)		(3,874	)
Beneficial conversion features		-			-			197,176			-			197,176
Valuation of warrants		-			-			57,175			-			57,175
Shares returned		(100,000,000	)		(100,000	)		100,000			-			-
Issuance of common shares for property		200,000			200			19,800			-			20,000
Net loss for the year ended September 30, 2012		-			-			-			(578,753	)		(578,753	)
Balance, September 30, 2012		288,200,000			288,200			8,351			(604,827	)		(308,276	)
Beneficial conversion features		-			-			35,736			-			35,736
Valuation of warrants		-			-			4,070			-			4,070
Net loss for the year ended September 30, 2013		-			-			-			(356,026	)		(356,026	)
Balance, September 30, 2013		288,200,000			288,200			48,157			(960,853)	)		(624,496)	)
Net loss for the period ended March 31, 2014		-			-			-			(129,735	)		(129,735	)
Balance, March 31, 2014		288,200,000		$	288,200		$	48,157		$	(1,090,588	)	$	(754,231	)

The accompanying notes are an integral part of these consolidated financial statements.

F-3

SOLO INTERNATIONAL, INC,

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the six month periods ended March 31, 2014 and 2013

and for the period from

April 30, 2010 (date of inception) to March 31, 2014

(Unaudited)

	Six months ended March 31, 2014			Six months ended March 31, 2013			From inception (April 30, 2010) to March 31, 2014

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(129,735	)	$	(229,330	)	$	(1,090,588	)
Adjustment to reconcile net loss to net cash (used in) operating activities:
Change in fair value of derivative liabilities		(2,440	)		-			(2,440	)
Interest expense-Amortization on discount of convertible promissory notes		43,870			96,566			326,697
Impairment on mineral claims		-			-			225,000
Changes in operating assets and liabilities:
(Increase) decrease in prepaid expense		(3,201	)		118			(4,298	)
Increase (decrease) in accounts payable and accrued liabilities		16,705			20,991			132,211
Net cash provided by (used) in operating activities		(74,801	)		(111,655	)		(413,418	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase mineral claims		-			-			(205,000	)
Net cash used in investing activities		-			-			(205,000	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Advances from related party		-			-			6,417
Proceeds from convertible notes payable		75,000			80,000			590,000
Proceeds from issuance of common stock		-			-			22,200
Net cash provided by financing activities		75,000			80,000			618,617

Increase (decrease) in cash during the period		199			(31,655	)		199
Cash, beginning of period		-			44,561			-
Cash, end of period	$	199		$	12,906		$	199


Supplemental cash flow information:
Cash paid for:
Interest	$	-		$	-		$	-
Taxes	$	-		$	-		$	-

Non-cash transactions:
Shares issued for acquisition of mineral property	$	-		$	-		$	20,000

The accompanying notes are an integral part of these consolidated financial statements.

F-4

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

1. ORGANIZATION

SOLO INTERNATIONAL, INC. was founded in the State of Nevada on April 30, 2010 as a Poland based corporation intending to provide services in interior architectural design in Poland.

On October 12, 2011, Mr. Michel Plante acquired control of three million (3,000,000) pre-split shares of the Company’s issued and outstanding common stock, representing approximately 77.32% of the Company’s total issued and outstanding common stock, from Mr. Yury Shcharbakou in accordance with a stock purchase agreement by and between Mr. Plante and Mr. Shcharbakou, thus effecting a change in control of the Company.

On October 13, 2011, the Board of Directors of the Company authorized a forward split of its issued and outstanding common shares, whereby every one (1) old share of common stock will be exchanged for one hundred (100) new shares of the Company's common stock.

The effect of the stock split has been recognized retroactively in the stockholders’ deficit accounts as of April 30, 2010, and in all shares and per share data in the financial statements.

With the change in control of the Company, management determined not to pursue its operations in Poland and determined to enter into the mining business in the Province of Quebec and incorporated a wholly-owned Quebec subsidiary, 9252-4768 Quebec Inc. On November 15, 2011, the Company, through its wholly-owned Quebec subsidiary, entered into a Property Option Agreement with 9228-6202 Quebec Inc., a Quebec corporation. Pursuant to the Option Agreement, 9252-4768 Quebec Inc. acquired the exclusive option to acquire an undivided 100% right, title and interest in and to certain mineral claims located in Portland Township, Outaouais, Quebec subject to a royalty reserved to 9228-6202 Quebec Inc.

The Company is an Exploration Stage Company, as defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification ("ASC") 915, Development Stage Entities. The Company's principal business is the acquisition and exploration of mineral resources. The Company has not presently determined whether its properties contain mineral reserves that are economically recoverable.

Since Inception (April 30, 2010) through March 31, 2014, the Company has not generated any revenue and has an accumulated deficit of $1,090,588.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Interim Financial Statements

The accompanying interim unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Consolidated operating results for the six month period ended March 31, 2014 are not necessarily indicative of the results that may be expected for the year ending September 30, 2014. For further information, refer to the consolidated financial statements and footnotes thereto included in our Form 10-K Report for the fiscal year ended September 30, 2013 filed with the Securities and Exchange Commission on December 30, 2013.

F-5

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Basis of Presentation

The unaudited interim consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim consolidated financial information and pursuant to the rules and regulations of the SEC. Accordingly; they do not include all the information and footnotes required by GAAP for complete consolidated financial statements. However, management believes that the disclosures made are adequate to make the information not misleading. Management has evaluated subsequent events through the date the financial statements were issued.

Going Concern

The consolidated financial statements have been prepared on a going concern basis that assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has incurred losses since inception resulting in an accumulated deficit of $1,090,588 as of March 31, 2014 and further losses are anticipated in the development of its business raising substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand and loans from directors and/or private placement of common stock. These financials do not include any adjustments relating to the recoverability and reclassification of recorded asset amounts, or amounts and classifications of liabilities that might result from this uncertainty.

Cash and Cash equivalents

For purposes of Statement of Cash Flows, the Company considers all highly liquid debt instruments purchased with a maturity date of six months or less to be cash equivalents.

Use of Estimates and Assumptions

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.

Foreign Currency Translation

The Company's functional currency and its reporting currency is the United States dollar.

F-6

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Income Taxes

The Company follows the liability method of accounting for income taxes. Under this method, deferred income tax assets and liabilities are recognized for the estimated tax consequences attributable to differences between the financial statement carrying values and their respective income tax basis (temporary differences). The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Basic and Diluted Loss Per Share

Basic loss per share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period.

The Company had the following potential common stock equivalents at March 31, 2014:

Warrants

12,000,000

Since the Company reflected a net loss in the period ended March 31, 2014, and in fiscal years 2013 and 2012, respectively, the effect of considering any common stock equivalents, if outstanding, would have been anti-dilutive. A separate computation of diluted earnings (loss) per share is not presented.

Stock-based Compensation

The Company records stock based compensation in accordance with the guidance in ASC Topic 718, which requires the Company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.

Mineral Property Costs

Mineral exploration and development costs are accounted for using the successful efforts method of accounting.

Property acquisition costs - Mineral property acquisition costs are capitalized as mineral exploration properties. Upon achievement of all conditions necessary for reserves to be classified as proved, the associated acquisition costs are reclassified to prove properties

Exploration costs - Geological and geophysical costs and the costs of carrying and retaining undeveloped properties are expensed as incurred.

F-7

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Impairment of Mineral Properties

Unproved mineral properties are assessed at each reporting period for impairment of value, and a loss is recognized at the time of the impairment by providing an impairment allowance. An asset would be impaired if the undiscounted cash flows were less than its carrying value. Impairments are measured by the amount by which the carrying value exceeds its fair value. Because the Company uses the successful efforts method, the Company assesses its properties individually for impairment, instead of on an aggregate pool of costs. Impairment of unproved properties is based on the facts and circumstances surrounding each lease and is recognized based on management’s evaluation. Management’s evaluation follows a two-step process where (1) recoverability of the carrying value of the asset is reviewed to determine if there is sufficient value recoverable to support the capitalized value at the report date; and, (2) If assets fail the recoverability test, impairment testing is conducted, including the evaluation of various criteria such as: prior history of successful operations; production currently in place and/or future projected cash flows (if any); reserve reports or evaluations from which management can prepare future cash flow analyses; the Company’s ability to monetize the asset(s) under evaluation; and, Management’s intent regarding future development.

Beneficial Conversion Feature

From time to time, the Company may issue convertible notes that may have conversion prices that create an embedded beneficial conversion feature pursuant to the Emerging Issues Task Force guidance on beneficial conversion features. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of any attached equity instruments, if any related equity instruments were granted with the debt. In accordance with this guidance, the intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the life of the note using the effective interest method.

Fair value of financial instruments

The Financial Accounting Standards Board issued ASC (Accounting Standards Codification) 820-10 (SFAS No. 157), “Fair Value Measurements and Disclosures" for financial assets and liabilities. ASC 820-10 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. FASB ASC 820-10 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. FASB ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required by the standard that the Company uses to measure fair value:

	Level 1: Quoted prices in active markets for identical assets or liabilities.



Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

	Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The following are the major categories of liabilities measured at fair value on a recurring basis as of March 31, 2014 and September 30, 2013, using quoted prices in active markets for identical liabilities (Level 1); significant other observable inputs (Level 2); and significant unobservable inputs (Level 3):

F-8

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Fair value of financial instruments (continued)

			March 31, 2014				September 30, 2013
Derivative liabilities	Level 3		$	70,190			$	-

Derivative Liabilities

Fair value accounting requires bifurcation of embedded derivative instruments, such as ratchet provisions or conversion features in convertible debt or equity instruments, and measurement of their fair value. In determining the appropriate fair value, the Company uses the Black-Scholes option-pricing model. In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventional convertible debt, the Company will continue its evaluation process of these instruments as derivative financial instruments.

Once derivative liabilities are determined, they are adjusted to reflect fair value at the end of each reporting period. Any increase or decrease in the fair value is recorded in results of operations as an adjustment to fair value of derivatives. In addition, the fair value of freestanding derivative instruments such as warrants, are also valued using the Black-Scholes option-pricing model.

3. MINERAL PROPERTY

On November 15, 2011, the Company through its wholly-owned Quebec subsidiary, 9252-4768 Quebec Inc., entered into a Property Option Agreement with 9228-6202 Quebec Inc., a Quebec corporation (the “Optionor”). Pursuant to the option agreement, the Company received the exclusive option to acquire an undivided 100% right, title and interest in and to certain mineral claims located in Portland Township, Outaouais, Quebec subject to a royalty reserved to the Optionor.

As part of the terms of the agreement the Company was required to make cumulative cash payments of $205,000 and to issue an aggregate number of restricted shares of common stock of the Company equal to twenty thousand US dollars ($20,000). On May 8, 2012 the Company issued a total of 200,000 shares of common stock at a deemed price of $0.10 per share. The Company capitalized the cash and stock payments as option costs on the mineral property. At the fiscal year ended September 30, 2012, the Company evaluated the recoverability of the amount paid for the option and determined to impair the amount in full, as the Company is currently in the exploration phase, with no proven or probable reserves having yet been determined.

On November 27, 2012, the Option Agreement was amended to revise certain property expenditure requirements, and concurrently it was agreed that the Company had earned its 100% right and interest in the Property for the payment of all expenditures up to November 27, 2012 and for allowing the Optionor to utilize a portion of the expenditures expended by the Optionee to apply to certain of the Optionor’s claims. The Company has transferred the title to the Property to its wholly owned subsidiary, 9252-4768 Quebec Inc.

During the six months ended March 31, 2014 and March 31, 2013, the Company expended $0 and $13,753 on exploration respectively.

F-9

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

4. COMMON STOCK

The authorized capital of the Company is 900,000,000 common shares with a par value of $ 0.001 per share.

As of March 31, 2014, 288,200,000 common stock shares were issued and outstanding.

5. CONVERTIBLE PROMISSORY NOTE, NET and DERIVATIVE LIABILITIES

(i)	Craigstone Ltd. (“Craigstone”)

On November 4, 2011, the Company entered into a Securities Purchase Agreement with Craigstone pursuant to which the Company received $100,000 as a loan from Craigstone in exchange for one (1) Unit consisting of: a Convertible Promissory Note convertible to common stock in whole or in part, at any time and from time to time before maturity at the option of the holder at seventy-five percent (75%) of the average traded price of the common stock for the thirty (30) trading days immediately preceding the conversion date; and a three (3) year Warrant (the “Warrant”) to purchase two hundred fifty thousand (250,000) shares of the Company’s Common Stock exercisable at the lower of : (i) a price of $0.20 per share or (ii) seventy-five percent (75%) of the average traded price of common stock for the thirty (30) trading days immediately preceding the exercise date. The Note earns simple interest accruing at ten percent (10%) per annum and was due on or before the twelfth month anniversary of the date of execution. The due dates were extended as described further herein.

During the fiscal year ended September 30, 2012, the Company entered into additional Securities Purchase Agreements with Craigstone pursuant to which the Company received collectively $320,000 as loans whereby each funding received one (1) Unit consisting of: a Convertible Promissory Note convertible to common stock in whole or in part, at any time and from time to time before maturity at the option of the holder at seventy-five percent (75%) of the average traded price of the common stock for the thirty (30) trading days immediately preceding the conversion date; and a three (3) year Warrant (the “Warrant”). Collectively under the Securities Purchase Agreements, Craigstone was granted the rights to purchase seven hundred twelve thousand five hundred (712,500) shares of the Company’s Common Stock exercisable at the lower of : (i) a price of $0.20 per share or (ii) seventy-five percent (75%) of the average traded price of common stock for the thirty (30) trading days immediately preceding the exercise date. The Notes earn simple interest accruing at ten percent (10%) per annum and were due on or before the twelfth month anniversary of the date of execution. The due dates were extended as described further herein.

During the fiscal year ended September 30, 2013, the Company entered into three additional Securities Purchase Agreements with Craigstone pursuant to which the Company received a total of $45,000 as loans in exchange for which each funding received one (1) Unit consisting of a Convertible Promissory Note convertible to common stock in whole or in part, at any time and from time to time before maturity at the option of the holder at seventy-five percent (75%) of the average traded price of the common stock for the thirty (30) trading days immediately preceding the conversion date; and collectively received a three (3) year Warrant (the “Warrant”) to purchase one hundred twelve thousand five hundred (112,500) shares of the Company’s Common Stock exercisable at the lower of: (i) a price of $0.20 per share or (ii) seventy-five percent (75%) of the average traded price of common stock for the thirty (30) trading days immediately preceding the exercise date. The Notes earn simple interest accruing at ten percent (10%) per annum and is due on or before the twelfth month anniversary of the date of execution.

The beneficial conversion feature resulting from the discounted conversion price compared to market price was valued on the dates of grant to be $215,439 on the notes, and $60,439 on the warrants. This value was recorded as a discount on debt and offset to additional paid in capital. Amortization of the discount was $3,646 for the six months ended March 31, 2014 (March 31, 2013 - $96,566), which amount has been recorded as interest expense.

F-10

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

5. CONVERTIBLE PROMISSORY NOTE, NET and DERIVATIVE LIABILITIES (continued)

(i)	Craigstone Ltd. (“Craigstone”) (continued)

	March 31, 2014			September 30, 2013			Issue Date
Convertible Promissory Note – face value, due on March 31, 2015	$	100,000		$	100,000		$	100,000
Convertible Promissory Note – face value, due on November 4, 2014		115,000			115,000			115,000
Convertible Promissory Note – face value, due on March 31, 2015		85,000			85,000			85,000
Convertible Promissory Note – face value, due on March 31, 2015		35,000			35,000			35,000
Convertible Promissory Note – face value, due on May 11, 2014		25,000			25,000			25,000
Convertible Promissory Note – face value, due on June 19, 2014		25,000			25,000			25,000
Convertible Promissory Note – face value, due on March 31, 2015		35,000			35,000			35,000
Convertible Promissory Note – face value, due on March 31, 2015		15,000			15,000			15,000
Convertible Promissory Note – face value, due on March 31, 2015		15,000			15,000			15,000
Convertible Promissory Note – face value, due on May 30, 2014		15,000			15,000			15,000
Total convertible promissory note – face value		465,000			465,000			465,000
Less: beneficial conversion feature		(848	)		(4,225	)		(215,439	)
Warrant discount		(26	)		(294	)		(60,439	)
	$	464,126		$	460,480		$	189,122

Interest expenses:

	For the three month period				For the six month period
	March 31, 2014		March 31, 2013		March 31, 2014		March 31, 2013
Amortization of debt discount	$	1,311	$	38,897	$	3,646	$	96,566
Interest at contractual rate		11,466		11,726		23,186		22,883
Totals	$	12,777	$	50,623	$	26,832	$	119,449

On January 31, 2013, Craigstone agreed to extend the maturity dates of certain notes due and payable on November 4, 2012, January 4, 2012 and February 3, 2013 for a period of one year or greater so that the respective notes are now due and payable on November 4, 2013, November 4, 2014 and February 3, 2014.

On May 31, 2013, Craigstone agreed to extend the maturity dates of certain notes due and payable on March 8, 2013, May 11, 2013 and June 19, 2013 to March 8, 2014, May 11, 2014 and June 19, 2014. On February 6, 2014 the Craigstone agreed to extend the maturity dates of certain notes due and payable on September 11, 2013, October 19, 2013, October 26, 2013, November 4, 2013, February 3, 2014 and March 8, 2014 to March 31, 2015.

Presently the Company and Craigstone are in negotiation to extend the repayment terms of all notes which are presently due and payable.

(ii)	Adams Ale Inc.

Effective February 15, 2013, the Company entered into a Securities Purchase Agreement with Adams Ale Inc. (“Adams”) pursuant to which Adams agreed to undertake a private placement in the amount of $100,000. On May 1, 2013, Adams had not fully funded the private placement, having funded an amount of $50,000 and agreed to convert to a Convertible Promissory Note on the same commercial terms as the Craigstone notes discussed above. The Company agreed to enter into a Securities Purchase Agreement with Adams for the funded amount of $50,000 in exchange for one (1) Unit consisting of: a Convertible Promissory Note convertible to common stock in whole or in part, at any time and from time to time before maturity at the option of the holder at seventy-five percent (75%) of the average traded price of the common stock for the thirty (30) trading days immediately preceding the conversion date; and a three (3) year Warrant (the “Warrant”) to purchase one hundred twenty-five thousand (125,000) shares of the Company’s Common Stock exercisable at the lower of : (i) a price of $0.20 per share or (ii) seventy-five percent (75%) of the average traded price of common stock for the thirty (30) trading days immediately preceding the exercise date. The Note earns simple interest accruing at ten percent (10%) per annum and is due on or before the twelfth month anniversary of the date of execution.

F-11

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

5. CONVERTIBLE PROMISSORY NOTE, NET and DERIVATIVE LIABILITIES (continued)

(ii)	Adams Ale Inc. (continued)

The beneficial conversion feature resulting from the discounted conversion price compared to market price was valued on the date of grant to be $17,473 on the note, and $806 on the warrants. This value was recorded as a discount on debt and offset to additional paid in capital. Amortization of the discount for the six months ended March 31, 2014 was $6,811 (March 31, 2013 - $nil), which amount has been recorded as interest expense.

	March 31, 2014		September 30, 2013			Issue Date
Convertible Promissory Note – face value, due on February 15, 2014	$	50,000	$	50,000		$	50,000
Total convertible promissory note – face value		50,000		50,000			50,000
Less: beneficial conversion feature		-		(6,511	)		(17,473	)
Warrant discount		-		(300	)		(806	)
		50,000		43,189			31,721

Interest expenses:

	For the three month period						For the six month period
	March 31, 2014			March 31, 2013			March 31, 2014			March 31, 2013
Amortization of debt discount		$	2,203		$	-		$	6,811		$	-
Interest at contractual rate			1,233			-			2,493			-
Totals		$	3,436		$	-		$	9,304		$	-

Presently the Company and Adams Ale are in negotiation to extend the repayment terms of the aforementioned note which is currently due and payable.

(iii)

Asher Enterprises, Inc.

On October 22, 2013, we raised $37,500, through a private offering of a convertible promissory note (“SPA #1). Under the terms of the Note, interest shall accrue at 8% per annum until June 20, 2014 (the “Maturity Date”), at which time, unless converted, all principal and accrued interest shall be due and payable. Any amount of principal or interest on the Note which is not paid when due shall bear interest at the rate of twenty two percent (22%) per annum from the due date thereof until the same is paid (“Default Interest”). Interest shall commence accruing on the date that the Note is fully paid and shall be computed on the basis of a 365-day year and the actual number of days elapsed. The holder shall have the right from time to time, and at any time during the period beginning on the date which is 180 days following the date of the note (dated September 18, 2013) to convert the Note, in whole or in part, into full paid and non-assessable shares of Common Stock. The conversion price (the “Conversion Price”) shall equal the Variable Conversion Price which shall mean shall mean 55% multiplied by the Market Price (as defined herein) (representing a discount rate of 45%) (subject to equitable adjustments for stock splits, stock dividends or rights offerings by the Borrower relating to the Borrower’s securities or the securities of any subsidiary of the Borrower, combinations, recapitalization, reclassifications, extraordinary distributions and similar events). “Market Price” means the average of the lowest three (3) Trading Prices (as defined below) for the Common Stock during the ten (10) Trading Day period ending on the latest complete Trading Day prior to the Conversion Date. “Trading Price” means, for any security as of any date, the closing bid price on the Over-the-Counter Bulletin Board, or applicable trading market.

F-12

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

5. CONVERTIBLE PROMISSORY NOTE, NET and DERIVATIVE LIABILITIES (continued)

(iii)

Asher Enterprises, Inc. (continued)

On January 2, 2014 and February 18, 2014, we raised additional $22,500 and $15,000, respectively, through serials private offering of convertible promissory notes (“SPA #2” and “SPA #3”). Under the terms of the Note, interest shall accrue at 8% per annum until June 20, 2014 and November 3, 2014, respectively, (the “Maturity Date”), at which time, unless converted, all principal and accrued interest shall be due and payable. Any amount of principal or interest on the Note which is not paid when due shall bear interest at the rate of twenty two percent (22%) per annum from the due date thereof until the same is paid (“Default Interest”). Interest shall commence accruing on the date that the Note is fully paid and shall be computed on the basis of a 365-day year and the actual number of days elapsed. The holder shall have the right from time to time, and at any time during the period beginning on the date which is 180 days following the date of the note (dated December 18, 2013 and dated January 30, 2014, respectively) to convert the Note, in whole or in part, into full paid and non-assessable shares of Common Stock. The conversion price (the “Conversion Price”) shall equal the Variable Conversion Price which shall mean shall mean 55% multiplied by the Market Price (as defined herein) (representing a discount rate of 45%) (subject to equitable adjustments for stock splits, stock dividends or rights offerings by the Borrower relating to the Borrower’s securities or the securities of any subsidiary of the Borrower, combinations, recapitalization, reclassifications, extraordinary distributions and similar events). “Market Price” means the average of the lowest three (3) Trading Prices (as defined below) for the Common Stock during the ten (10) Trading Day period ending on the latest complete Trading Day prior to the Conversion Date. “Trading Price” means, for any security as of any date, the closing bid price on the Over-the-Counter Bulletin Board, or applicable trading market.

In our evaluation of the financing arrangement, we concluded that the conversion features were not afforded the exemption as a conventional convertible instrument and it did not otherwise meet the conditions set forth in current accounting standards for equity classification. Accordingly, they do not meet the conditions necessary to obtain equity classification and are required to be carried as derivative liabilities.

Since equity classification is not available for the conversion feature, we were required to bifurcate the embedded conversion feature and carry it as a derivative liability, at fair value. Derivative financial instruments are carried initially and subsequently at their fair values.

We estimated the fair value of the compound derivative on the inception dates, and subsequently, using the Black-Scholes Merton valuation technique, adjusted for the effect of dilution, because that technique embodies all of the assumptions (including, volatility, expected terms, and risk free rates) that are necessary to fair value complex compound derivate instruments.

As a result of the application of ASC No. 815 in period ended March 31, 2014 and issued date of October 22, 2013, January 2, 2014 and February 18, 2014; the fair value of the conversion feature is summarized as follows:

	SPA #1			SPA #2			SPA #3			Total
Derivative liabilities, issued date	$	35,500		$	22,130		$	15,760		$	73,390
Fair value mark to market adjustment		(1,300	)		(670	)		(1,230	)		(3,200	)
Derivative liabilities, March 31, 2014	$	34,200		$	21,460		$	14,530		$	70,190

The Company recorded the debt discount in the amount of $35,500, $22,130 and $15,000 for each SPA as of issued date.

F-13

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

5. CONVERTIBLE PROMISSORY NOTE, NET and DERIVATIVE LIABILITIES (continued)

(iii)

Asher Enterprises, Inc. (continued)

The fair value at the commitment and re-measurement dates for the Company’s derivative liabilities were based upon the following management assumptions as of March 31, 2014 and commitment date (October 22, 2013, January 2, 2014 and February 18, 2014):

	Commitment Date				Re-measurement March 31, 2014
Expected dividends			0	%			0	%
Expected volatility		259.49 ~ 293.96 %					293.37	%
Expect term	0.33 ~ 0.72 years				0.22 ~ 0.59 years
Risk free interest rate		0.04 ~ 0.10 %				0.05 ~ 0.07 %

Amortization of the discount over the three month and six month period ended March 31, 2014 were $23,102 and $33,414 (March 31, 2013 - $nil), which amount has been recorded as interest expense and is reflected on the Company’s balance sheet as Convertible Note Liabilities, Net. The unamortized discount of $39,216 will be expensed in future periods.

	March 31, 2014		Issue Date
Convertible Promissory Note – face value, due on June 20, 2014	$	37,500	$	37,500
Convertible Promissory Note – face value, due on September 20, 2014		22,500		22,500
Convertible Promissory Note – face value, due on November 2, 2014		15,000		15,000
Total convertible promissory note – face value		75,000		75,000
Less: Debt discount		(39,216)		(72,630)
		35,784		2,370

Interest expenses:

	For the three month period						For the six month period
	March 31, 2014			March 31, 2013			March 31, 2014			March 31, 2013
Amortization of debt discount		$	23,102		$	-		$	33,414		$	-
Interest at contractual rate			1,313			-			1,889			-
Totals		$	24,415		$	-		$	35,303		$	-

6. RELATED PARTY TRANSACTIONS

On September 13, 2013, Mr. Michael Jacob Cooper Smith was appointed to the Board of Directors and as an officer of the Company.

On September 30, 2013, the Company entered a three-year employment agreement with Mr. Michael Jacob Cooper Smith. Under the terms of the agreement, the Company shall pay Mr. Smith a base salary of $30,000 per annum, paid monthly. The amount of base salary may be increased from time to time by the Board of Directors of the Company. Mr. Smith shall be eligible for periodic bonus in amounts to be determined by the Board of Directors.

F-14

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

6. RELATED PARTY TRANSACTIONS (continued)

During the six month period ended March 31, 2014, Mr. Michael Jacob Cooper Smith invoiced the Company for his services in the amount of $15,000. In addition, he received bonus in the amount of $3,500 during the three month period ended December 31, 2013. The Company paid $23,000 in cash, leaving $2,000 on the balance sheets as prepaid expenses (accounts payable – related party: as of September 30, 2013 - $2,500)

7. WARRANTS

An aggregate of 1,200,000 warrants were issued and outstanding as at March 31, 2014 and September 30, 2013 as required under the terms of a series of Securities Purchase Agreements discussed above in Note 5(i). The warrants are exercisable for a period of three years from the date of issue, exercisable at the lower of : (i) a price of $0.20 per share or (ii) seventy-five percent (75%) of the average traded price of the Company’s common stock for the thirty (30) trading days immediately preceding the exercise date.

The fair value of the 1,200,000 warrants totaling $61,245 was recorded as a discount on the convertible notes payable upon issuance. This value was calculated using the Black-Scholes model. The key inputs for the calculation are shown below:

Stock Price on Measurement Date	$	0.0068 ~ 0.135
Exercise Price of Warrants	$	0.0051 ~ 0.101
Term of Warrants (years)			3.00
Computed Volatility		125.84% ~ 147.91%
Annual Dividends			0.00	%
Discount Rate		0.33 ~ 0.49 %

A summary of the Company’s warrants as of March 31, 2014 and September 30, 2013 as follows:

	March 31, 2014				September 30, 2013
	Warrants		Weighted average exercise price		Warrants		Weighted average exercise price
Outstanding at the beginning of the period		1,200,000	$	0.060		962,500		$	0.069
Granted		-				237,500			0.024
Exercised		-				-			-
Cancelled		-				-			-
Outstanding at the end of the period		1,200,000	$	0.060		1,200,000		$	0.060
Vested and exercisable at the end of period		1,200,000				1,200,000
Weighted average fair value per share of warrants granted during the period			$	-				$	0.060

F-15

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

7. WARRANTS (continued)

The following table summarizes information regarding stock purchase warrants outstanding at March 31, 2014:

		Warrants Outstanding						Warrants Exercisable
Exercise prices		Number Outstanding		Weighted average remaining contractual life (years)		Weighted average exercise price		Number exercisable	Weighted average remaining contractual life (years)	Weighted average exercise price
$	0.00563-0.10		1,200,000		1.02	$	0.060	1,200,000	1.02	$	0.060

As at March 31, 2014, the Company had the following warrants outstanding:

Exercise Price		Expiry Date	Weighted Average Remaining Contractual Life (Years)		Outstanding at September 30, 2013		Issued		Exercised		Expired		Outstanding at March 31, 2014
$	0.075	November 4, 2014		0.60		250,000		-		-		-		250,000
$	0.075	November 4, 2014		0.60		250,000		-		-		-		250,000
$	0.101	February 3, 2015		0.85		177,083		-		-		-		177,083
$	0.041	March 8, 2015		0.94		72,917		-		-		-		72,917
$	0.052	May 11, 2015		1.11		62,500		-		-		-		62,500
$	0.03	June 19, 2015		1.22		62,500		-		-		-		62,500
$	0.03	September 11, 2015		1.45		87,500		-		-		-		87,500
$	0.064	October 19, 2015		1.55		37,500		-		-		-		37,500
$	0.056	October 26, 2015		1.57		37,500		-		-		-		37,500
$	.008	February 15, 2016		1.88		125,000		-		-		-		125,000
$	0.005	May 30,2016		2.17		37,500		-		-		-		37,500
				1.02		1,200,000		-		-		-		1,200,000

8. INCOME TAXES

The Company has losses carried forward for income tax purposes at March 31, 2014. There are no current or deferred tax expenses for the current period ended March 31, 2014 due to the Company’s loss position. The Company has fully reserved for any benefits of these losses. The deferred tax consequences of temporary differences in reporting items for financial statement and income tax purposes are recognized, as appropriate. Realization of the future tax benefits related to the deferred tax assets is dependent on many factors, including the Company’s ability to generate taxable income within the net operating loss carryforward period.

Management has considered these factors in reaching its conclusion as to the valuation allowance for financial reporting purposes.

F-16

SOLO INTERNATIONAL, INC.

(An Exploration Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2014

(Unaudited)

8. INCOME TAXES (continued)

	March 31, 2014			September 30, 2013
Net operating loss carry forward		1,090,588			960,853
Effective Tax Rate		35	%		35	%
Deferred Tax Assets		381,705			336,200
Less: Valuation Allowance		(381,705	)		(336,200	)
Net deferred tax asset	$	0		$	0

The valuation allowance for deferred tax assets as of March 31, 2014 and September 30, 2013 was $381,705 and $336,200 respectively. In assessing the recovery of the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in the periods in which those temporary differences become deductible. Management considers the scheduled reversals of future deferred tax assets, projected future taxable income, and tax planning strategies in making this assessment.

As a result, management determined it was more likely than not the deferred tax assets would not be realized as of March 31, 2014 and September 30, 2013, and recorded a full valuation allowance.

Reconciliation between the statutory rate and the effective tax rate is as follows at March 31, 2014 and September 30, 2013:

	March 31, 2014			September 30, 2013
Federal statutory tax rate		(35.0	)%		(35.0	)%
Permanent difference and other		35.0	%		35.0	%
Effective tax rate		-	%		-	%

The net federal operating loss carry forward will expire between 2030 and 2034. This carry forward may be limited upon the consummation of a business combination under IRC Section 381.

9. SUBSEQUENT EVENTS

On May 13, 2014 the Company received an advance of $8,000 from an unrelated third party as general working capital. Repayment terms are presently under negotiation.

The Company has evaluated subsequent events from the balance sheet date through the date that the financial statements were issued and determined that there were no other events to disclose.

F-17

ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

FORWARD-LOOKING STATEMENTS

This Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) contains forward-looking statements that involve known and unknown risks, significant uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, or implied, by those forward-looking statements. You can identify forward-looking statements by the use of the words may, will, should, could, expects, plans, anticipates, believes, estimates, predicts, intends, potential, proposed, or continue or the negative of those terms. These statements are only predictions. In evaluating these statements, you should consider various factors which may cause our actual results to differ materially from any forward-looking statements. Although we believe that the exceptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

RESULTS OF OPERATIONS

Working Capital

	March 31, 2014 $			September 30, 2013 $
Current Assets		4,497			1,097
Current Liabilities		758,728			625,593
Working Capital (Deficit)		(754,231	)		(624,496	)

Cash Flows

	March 31, 2014 $			March 31, 2013 $
Cash Flows from (used in) Operating Activities		(74,801	)		(111,655	)
Cash Flows from (used in) Investing Activities		0			0
Cash Flows from (used in) Financing Activities		75,000			80,000
Net Increase (decrease) in Cash During Period		199			(31,655	)

Operating Revenues

Operating revenues for the periods ended March 31, 2014 and 2012 were $0.

Operating Expenses and Net Loss

Comparison of three month periods ended March 31, 2014 and 2013

Operating and other expenses for the three month period ended March 31, 2014 totaled $21,576 and are comprised of $11,738 in professional fees, $7,500 in fees paid under a related party management contract, and $2,338 in other general and administrative expenses. In addition the Company recorded $40,628 as interest expenses, $3,514 of which was the amortization of the debt discount from the beneficial conversion feature and warrant discount resulting from convertible promissory notes and $23,102 from the amortization of debt discount from convertible notes.

During the prior comparative period, operating and other expenses for the three months ended March 31, 2013 totaled $49,151 and are comprised of $19,259 in professional fees, $7,500 in fees paid under a related party management contract, and $22,392 in other general and administrative expenses. In addition the Company recorded $50,623 as interest expenses, $38,897 of which was the amortization of the debt discount from the beneficial conversion feature and warrant discount relating to convertible promissory notes issued during the period.

Net loss for the period ended March 31, 2014 was $59,764 as compared to $99,774 for the three month period ended March 31, 2013. The decrease in operating expenses and losses is predominantly due to the decrease in other general and administrative expenses from $22,392 (March 31, 2013) to $2,338 (March 31, 2014), as well as the decrease in professional fees from $19,259 (March 31, 2013) to $11,738 (March 31, 2014) and the fact that interest expenses decreased from $50,623 (2013) to $40,628 (2014).

Comparison of six month periods ended March 31, 2014 and 2013

Operating and other expenses for the six month period ended March 31, 2014 totaled $60,737 and are comprised of $30,960 in professional fees, $18,500 in fees paid under a related party management contract, and $11,277 in other general and administrative expenses. In addition the Company recorded $71,438 as interest expenses, $10,456 of which was the amortization of the debt discount from the beneficial conversion feature and warrant discount resulting from convertible promissory notes and $33,414 from the amortization of debt discount from convertible notes.

During the period comparative period, operating and other expenses for the six months ended March 31, 2013 totaled $109,881 and are comprised of $33,981 in professional fees, $15,000 in fees paid under a related party management contract, $47,147 in other general and administrative expenses and $13,753 in exploration expenses. In addition the Company recorded $119,449 as interest expenses, $96,566 of which was the amortization of the debt discount from the beneficial conversion feature and warrant discount relating to convertible promissory notes issued during the period.

Net loss for the period ended March 31, 2014 was $129,735 as compared to $229,330 for the six month period ended March 31, 2013. The decrease in operating expenses and losses is due to the exploration expense in the period ended March 31, 2013 with no comparable exploration expenses during the period ended March 31, 2014, and the decrease in other general and administrative expenses from $47,147 (March 31, 2013) to $11,277 (March 31, 2014), the decrease in professional fees from $33,981 to $30,960, which reductions were slightly offset by an increase in management fees from $15,000 (2013) to $18,500 (2014). Additionally interest expenses were substantially reduced from $119,449 (2013) to $71,438 (2014).

Liquidity and Capital Resources

As at March 31, 2014, the Company had total assets of $4,297 compared to $1,097 as at September 30, 2013. The increase in total assets is attributable to the payment of operational costs offset by funds raised of $75,000 during the period.

As at March 31, 2014, the Company had total liabilities of $758,728 as compared with total liabilities of $625,593 as at September 30, 2013. The increase in total liabilities was mainly due to derivative liabilities in respect of the Company’s financing efforts during the six months ended March 31, 2014 with no comparable liability as at September 30, 2013. Accounts payable and accrued liabilities increased from $113,006 as at September 30, 2013 to $132,211 at Ma1rch 31, 2014 as the Company was unable to raise sufficient funds to meet its obligations as they became due.

As at March 31, 2014, the Company had a working capital deficit of $754,231 compared with a working capital deficit of $624,496 as at September 30, 2013. The increase in working capital deficit is mainly attributable to the increase in current liabilities as a result of the financing activities of the Company by way of convertible loans, and the Company’s expenditures for operations.

The Company has commenced exploration as required under its mineral property option agreement and has earned its rights to transfer title to the property under the agreement.

In order to meet all of the current commitments and fund operations for the next twelve months the Company estimates it will require a minimum of $500,000. We intend to undertake exploration on our mineral properties of approximately $300,000 and have allocated an additional $200,000 for operations, which may include the acquisition of additional properties as well as general and administrative costs.

We do not have sufficient funds to meet our next twelve month obligations. Our ability to meet our financial liabilities and commitments is primarily dependent upon the continued issuance of equity to new stockholders, the ability to borrow funds, and ultimately upon our ability to achieve and maintain profitable operations. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. We do not currently have sufficient capital to meet our obligations as they come due and while we have been able to raise funding to ensure that we meet our filing obligations, we have been unable to raise sufficient funding to undertake any exploration on our property. Should we be unable to continue to raise funding for our filing obligations we may have to cease operations. If the Company cannot raise exploration funds the properties which the Company currently holds could be lost.

Cashflow from Operating Activities

During the six month period ended March 31, 2014, the Company used $74,801 for operating activities compared to the use of $111,655 for operating activities during the period ended March 31, 2013. The decrease in net cash used in operating activities is attributed to the Company’s inability to raise sufficient funds to allow it to maintain and grow its operations. Non-cash items include a substantial reduction to the amortization of the debt discount recorded in the current period of $43,870 as compared to $96,566 in the six months ended March 31, 2013, which accounts for the most substantial change in cashflows from operating activities.

Cashflow from Investing Activities

During the three month period ended March 31, 2014 and March 31, 2013 the Company has expended no cash on investing activities.

Cashflow from Financing Activities

During the six month period ended March 31, 2014, the Company received $75,000 cash from financing activities by way of notes payable compared to $80,000 cash from notes payable for the six month period ended March 31, 2013.

Going Concern

We have not attained profitable operations and are dependent upon obtaining financing to pursue any extensive acquisitions and activities. For these reasons, our auditors stated in their report on our audited financial statements that they have substantial doubt that we will be able to continue as a going concern without further financing.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or 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 are material to stockholders.

Critical Accounting Policies

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

Recently Issued Accounting Pronouncements

We have reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may cause a material impact on our financial condition, or the results of our operations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management carried out an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("Exchange Act"). Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures were not effective as of March 31, 2014, due to the material weaknesses resulting from the Board of Directors not currently having any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K, and controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Please refer to our Annual Report on Form 10-K as filed with the SEC on December 30, 2013, for a complete discussion relating to the foregoing evaluation of Disclosures and Procedures.

Changes in Internal Control over Financial Reporting

Our management has also evaluated our internal control over financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of our last evaluation.

The Company is not required by current SEC rules to include, and does not include, an auditor's attestation report. The Company's registered public accounting firm has not attested to Management's reports on the Company's internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which our director, officer or any affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

ITEM 1A. RISK FACTORS

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

There were no issuances of unregistered securities to report which were sold or issued by the Company without the registration of these securities under the Securities Act of 1933 in reliance on exemptions from such registration requirements, within the period covered by this report, which have not been previously included in and Annual Report on Form 10-K, a Quarterly Report on Form 10-Q or a Current Report on Form 8-K.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS

Exhibits:

Exhibit Number	Description of Exhibit	Filing
3.01	Articles of Incorporation	Filed with the SEC on October 22, 2010 as part of our Registration Statement on Form S-1.
3.01(a)	Certificate of Change	Filed with the SEC on November 7, 2012 as part of our Current Report on Form 8-K.
3.02	Bylaws	Filed with the SEC on October 22, 2010 as part of our Registration Statement on Form S-1.
10.01	Service Agreement between Solo International, Inc. and “TIRCARS” Sp. J dated August 30, 2010	Filed with the SEC on October 22, 2010 as part of our Registration Statement on Form S-1.
10.02	Securities Purchase Agreement between Solo International, Inc. and Craigstone Ltd., dated November 4, 2012	Filed with the SEC on November 15, 2012 as part of our Current Report on Form 8-K.
10.03	Option Agreement by and between between Solo International, Inc. and 9228-6202 Quebec Inc., dated November 15, 2012	Filed with the SEC on November 23, 2012 as part of our Current Report on Form 8-K
10.04	Amended Option Agreement by and between 9252-4768 Quebec Inc. and 9228-6202 Quebec Inc. dated December 20, 2012	Filed with the SEC on January 3, 2013 as part of our Amended Current Report on Form 8-K/A.
10.05	Securities Purchase Agreement between Solo International, Inc. and Craigstone Ltd., dated January 10, 2013	Filed with the SEC on January 12, 2013 as part of our Current Report on Form 8-K.
10.06	Employment agreement between the Company and Michael Jacob Cooper Smith dated September 30, 2013	Filed with the SEC on December 30, 2013 as part of our Annual Report on Form 10-K.
10.07	Securities Purchase Agreement with Asher Enterprises Inc. dated September 18, 2013	Filed with the SEC on December 30, 2013 as part of our Annual Report on Form 10-K.
10.08	Securities Purchase Agreement with Asher Enterprises Inc. dated December 18, 2013	Filed with the SEC on December 30, 2013 as part of our Annual Report on Form 10-K.
10.09	Securities Purchase Agreement with Asher Enterprises Inc. dated January 30, 2014	Filed with the SEC on February 14, 2014 as part of our Quarterly Report on Form 10-Q.
31.1	Certification of Principal Executive Officer Pursuant to Rule 13a-14	Filed herewith.
31.2	Certification of Principal Financial Officer Pursuant to Rule 13a-14	Filed herewith.
32.1	CEO and CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act	Filed herewith.
101.INS*	XBRL Instance Document	Filed herewith.
101.SCH*	XBRL Taxonomy Extension Schema Document	Filed herewith.
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document	Filed herewith.
101.LAB*	XBRL Taxonomy Extension Labels Linkbase Document	Filed herewith.
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document	Filed herewith.
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document	Filed herewith.

*Pursuant to Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		SOLO INTERNATIONAL, INC.

Date: May 20, 2014	By:	/s/ Michael Cooper Smith
	Name:	Michael Cooper Smith
	Title:	President, Principal Executive Officer & Principal Financial Officer (Principal Accounting Officer)

Solo International, Inc - FORM 10-Q - May 20, 2014

Attached files

Solo International, Inc Reports