Attached files
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EX-31.2 - CERTIFICATION - Medifirst Solutions, Inc. | f10q0914ex31ii_medifirst.htm |
EX-32.1 - CERTIFICATION - Medifirst Solutions, Inc. | f10q0914ex32i_medifirst.htm |
EX-31.1 - CERTIFICATION - Medifirst Solutions, Inc. | f10q0914ex31i_medifirst.htm |
EXCEL - IDEA: XBRL DOCUMENT - Medifirst Solutions, Inc. | Financial_Report.xls |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: September 30, 2014
OR
☐ 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:
333-178825
MEDIFIRST SOLUTIONS, INC.
(Exact name of registrant as specified in its charter)
NEVADA | 27-3888260 | |
(State
or other jurisdiction of incorporation or organization) |
(IRS
Employer Identification Number) |
45 E. Main Street, Freehold NJ 07726
(Address of principal executive offices)
732-786-8044
(Issuer’s telephone number)
(Former name, former address and former fiscal year, if changed since last report) N/A
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 ☒ 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 during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☐ No ☒
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
(check one) Large accelerated filer ☐ | Accelerated filer ☐ | Non-accelerated filer ☐ | 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 ☒
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of November 18, 2014, there were 22,481,750 shares of Common Stock, $0.0001 par value, outstanding and 50,000 shares of Preferred Stock, .0001 par value, outstanding.
PART I. FINANCIAL INFORMATION |
||
Item 1. | Financial Statements. | 3 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations. | 20 |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk. | 22 |
Item 4. | Controls and Procedures. | 22 |
PART II. OTHER INFORMATION | ||
Item 1. | Legal Proceedings. | 23 |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds. | 23 |
Item 3. | Defaults Upon Senior Securities. | 23 |
Item 4. | Mine Safety Disclosures | 23 |
Item 5. | Other Information. | 23 |
Item 6. | Exhibits. | 23 |
2 |
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
Medifirst Solutions, Inc.
(A Development Stage Company)
Balance Sheet
Condensed Balance Sheets
September 30, 2014 and December 31, 2013
(Unaudited)
ASSETS | ||||||||
September 30, 2014 | December 31, 2013 | |||||||
Current Assets: | ||||||||
Cash | $ | 12,033 | $ | 3,720 | ||||
Accounts receivable, net of allowance of $ -0- | 30,755 | - | ||||||
Prepaid expenses | 3,900 | 2,500 | ||||||
Inventory | 9,400 | 7,500 | ||||||
Total current assets | 56,088 | 13,720 | ||||||
Property, Plant and Equipment, net | 7,120 | 5,199 | ||||||
Other Assets | ||||||||
Security deposit | 1,065 | 265 | ||||||
$ | 64,273 | $ | 19,184 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Liabilities | ||||||||
Bank overdraft | $ | - | $ | 1,644 | ||||
Accounts payable and accrued expenses | 299,532 | 231,958 | ||||||
Due to related party | 8,752 | - | ||||||
Loans payable - stockholders | 44,935 | 41,855 | ||||||
6% convertible notes | 7,975 | 8,765 | ||||||
Total current liabilities | 361,194 | 284,222 | ||||||
Stockholders' Equity: | ||||||||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized, 50,000 and -0- shares issued and outstanding, respectively | 5 | - | ||||||
Common stock, $0.0001 par value; 200,000,000 shares authorized, 19,881,750 and 13,781,750 shares issued and outstanding, respectively | 1,988 | 1,378 | ||||||
Additional paid in capital | 255,515 | 63,840 | ||||||
Deficit accumulated during development stage | (554,429 | ) | (330,256 | ) | ||||
(296,921 | ) | (265,038 | ) | |||||
$ | 64,273 | $ | 19,184 |
See accompanying summary of notes to unaudited condensed financial statements.
3 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Condensed Statements of Operations
For the Nine Months Ended September 30, 2014 and 2013 and for the Period
From November 8, 2010 (Inception) to September 30, 2014
From November 8, 2010 (Inception) to September 30, | For
the Three Months Ended September 30, | For
the Nine Months Ended September 30, | ||||||||||||||||||
2014 | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||
Consulting fee revenue | $ | 74,800 | $ | - | $ | 16,500 | $ | - | $ | 41,500 | ||||||||||
Product sales, net | 106,083 | - | 3,468 | 82,127 | 8,549 | |||||||||||||||
180,883 | - | 19,968 | 82,127 | 50,049 | ||||||||||||||||
Cost of goods sold | 48,593 | - | 1,165 | 45,895 | 5,941 | |||||||||||||||
Gross income | 132,290 | - | 18,803 | 36,232 | 44,108 | |||||||||||||||
Expenses: | ||||||||||||||||||||
Officer's compensation | 282,500 | 25,000 | 25,000 | 75,000 | 75,000 | |||||||||||||||
Advertising and promotion | 33,089 | 2,111 | 7,512 | 6,752 | 12,424 | |||||||||||||||
Computer and internet | 12,098 | 314 | 195 | 1,412 | 1,047 | |||||||||||||||
Fees | 950 | (150,252 | ) | (3,762 | ) | 950 | ||||||||||||||
Professional fees | 218,216 | 158,263 | 10,684 | 160,363 | 10,684 | |||||||||||||||
Rent | 9,587 | 3,161 | 825 | 3,687 | 825 | |||||||||||||||
Repairs and maintenance | 7,392 | (2,659 | ) | (4,308 | ) | 526 | 39 | |||||||||||||
Travel | 32,584 | 124 | 269 | 3,924 | 5,780 | |||||||||||||||
Other | 85,021 | (266 | ) | 2,753 | 5,712 | 7,408 | ||||||||||||||
681,437 | 35,796 | 39,168 | 258,326 | 113,207 | ||||||||||||||||
Net loss before other income, expenses and provision for income taxes | (549,147 | ) | (35,796 | ) | (20,365 | ) | (222,094 | ) | (69,099 | ) | ||||||||||
Other income and (expenses) | ||||||||||||||||||||
Interest expense | (4,532 | ) | (694 | ) | (264 | ) | (1,329 | ) | (1,405 | ) | ||||||||||
Net loss before provision for income taxes | (553,679 | ) | (36,490 | ) | (20,629 | ) | (223,423 | ) | (70,504 | ) | ||||||||||
Provision for income taxes | (750 | ) | - | - | (750 | ) | - | |||||||||||||
Net loss | $ | (554,429 | ) | $ | (36,490 | ) | $ | (20,629 | ) | $ | (224,173 | ) | $ | (70,504 | ) | |||||
Loss
per common share - Basic and fully diluted | $ | (0.07 | ) | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.01 | ) | $ | (0.01 | ) | |||||
Weighted average number of shares outstanding - Basic and fully diluted | 8,170,194 | 18,881,750 | 9,564,359 | 16,387,282 | 6,925,706 |
See accompanying summary of notes to unaudited condensed financial statements.
4 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Statement of Stockholders' Equity
For the Period from November 8, 2010 (Inception) to September 30, 2014
Common Stock | Preferred Class A | Additional Paid in | Accumulated Deficit During Development | Total Stockholders' | ||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Stage | Equity | ||||||||||||||||||||||
Issuance of common shares for services $0.0001 per share | 752,000 | $ | 75 | - | $ | - | $ | - | $ | - | $ | 75 | ||||||||||||||||
Issuance of common shares for cash at $0.08 per share | 81,250 | 8 | - | - | 6,492 | - | 6,500 | |||||||||||||||||||||
Issuance of common shares for cash at $0.08 per share | 37,500 | 4 | - | - | 2,996 | - | 3,000 | |||||||||||||||||||||
Issuance of common shares for cash at $0.08 per share | 125,000 | 12 | - | - | 9,988 | - | 10,000 | |||||||||||||||||||||
Issuance of common shares for cash at $0.00133 per share | 187,500 | 19 | - | - | 231 | - | 250 | |||||||||||||||||||||
Issuance of common shares for cash at $0.02 per share | 12,500 | 1 | - | - | 249 | - | 250 | |||||||||||||||||||||
Issuance of common shares for services at $0.08 per share | 125,000 | 12 | - | - | 9,988 | - | 10,000 | |||||||||||||||||||||
Issuance of common shares for cash at $0.01 per share | 25,000 | 3 | - | - | 247 | - | 250 | |||||||||||||||||||||
Issuance of common shares for cash at $0.002 per share | 315,000 | 32 | - | - | 598 | - | 630 | |||||||||||||||||||||
Net loss | - | - | - | (4,457 | ) | (4,457 | ) | |||||||||||||||||||||
Balance - December 31, 2010 | 1,660,750 | 166 | - | - | 30,789 | (4,457 | ) | 26,498 | ||||||||||||||||||||
Issuance of common shares for cash at $0.0034 per share | 250,000 | 25 | - | - | 825 | - | 850 | |||||||||||||||||||||
Issuance of common shares for cash at $0.01 per share | 25,000 | 2 | - | - | 248 | - | 250 | |||||||||||||||||||||
Issuance of common shares for cash at $0.016 per share | 12,500 | 1 | - | - | 199 | - | 200 | |||||||||||||||||||||
Issuance of common shares for cash at $0.0019 per share | 75,000 | 8 | - | - | 135 | - | 143 | |||||||||||||||||||||
Issuance of common shares for cash at $0.0014 per share | 250,000 | 25 | - | - | 325 | - | 350 | |||||||||||||||||||||
Issuance of common shares for services $0.002 per share | 3,750,000 | 375 | - | - | 7,125 | - | 7,500 | |||||||||||||||||||||
Issuance of common shares for cash at $0.0167 per share | 300,000 | 30 | - | - | 4,970 | - | 5,000 | |||||||||||||||||||||
Issuance of common shares for services $0.08 per share | 20,000 | 2 | - | - | 1,598 | - | 1,600 | |||||||||||||||||||||
Issuance of common shares for cash at $0.08 per share | 6,250 | 1 | - | - | 499 | - | 500 | |||||||||||||||||||||
Issuance of common shares for cash at $0.08 per share | 53,500 | 5 | - | - | 4,275 | - | 4,280 | |||||||||||||||||||||
Issuance of common shares for cash at $0.08 per share | 12,500 | 1 | - | - | 999 | - | 1,000 | |||||||||||||||||||||
Issuance of common shares for cash at $0.04 per share | 100,000 | 10 | - | - | 3,990 | - | 4,000 | |||||||||||||||||||||
Issuance of common shares for cash at $0.08 per share | 6,250 | 1 | - | - | 499 | - | 500 | |||||||||||||||||||||
Net loss | - | - | - | - | - | (36,788 | ) | (36,788 | ) | |||||||||||||||||||
Balance - December 31, 2011 | 6,521,750 | 652 | - | - | 56,476 | (41,245 | ) | 15,883 | ||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.001 per share | 150,000 | 15 | - | - | 135 | - | 150 | |||||||||||||||||||||
Net loss | - | - | - | - | - | (174,199 | ) | (174,199 | ) | |||||||||||||||||||
Balance - December 31, 2012 | 6,671,750 | 667 | - | - | 56,611 | (215,444 | ) | (158,166 | ) | |||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.001 per share | 660,000 | 66 | - | - | 594 | - | 660 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.001 per share | 200,000 | 20 | - | - | 180 | - | 200 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 700,000 | 70 | - | - | - | - | 70 | |||||||||||||||||||||
Issuance of common shares for services $0.10 per share | 50,000 | 5 | - | - | 4,995 | - | 5,000 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0006 per share | 400,000 | 40 | - | - | 200 | - | 240 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.001 per share | 300,000 | 30 | - | - | 270 | - | 300 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 400,000 | 40 | - | - | - | - | 40 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 50,000 | 5 | - | - | - | - | 5 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.001 per share | 700,000 | 70 | - | - | 630 | - | 700 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 350,000 | 35 | - | - | - | - | 35 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 300,000 | 30 | - | - | - | - | 30 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 350,000 | 35 | - | - | - | - | 35 | |||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 400,000 | 40 | - | - | 40 | |||||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 1,000,000 | 100 | - | - | 100 | |||||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 350,000 | 35 | - | - | 35 | |||||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.001 per share | 400,000 | 40 | 360 | - | 400 | |||||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 500,000 | 50 | - | - | 50 | |||||||||||||||||||||||
Net loss | (114,812 | ) | (114,812 | ) | ||||||||||||||||||||||||
Balance - December 31, 2013 | 13,781,750 | 1,378 | - | - | 63,840 | (330,256 | ) | (265,038 | ) | |||||||||||||||||||
Issuance of common shares for services $0.05 per share | 1,000,000 | 100 | 49,900 | - | 50,000 | |||||||||||||||||||||||
Issuance of common shares for services $0.05 per share | 500,000 | 50 | 24,950 | - | 25,000 | |||||||||||||||||||||||
Issuance of common shares to repay debt at $0.0555 | 450,000 | 45 | 24,955 | - | 25,000 | |||||||||||||||||||||||
Issuance of common shares for cash at $0.05 per share | 200,000 | 20 | 9,980 | - | 10,000 | |||||||||||||||||||||||
Issuance of common shares for cash at $0.05 per share | 300,000 | 30 | 14,970 | - | 15,000 | |||||||||||||||||||||||
Issuance of common shares for cash at $0.05 per share | 200,000 | 20 | 9,980 | - | 10,000 | |||||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 500,000 | 50 | - | - | 50 | |||||||||||||||||||||||
Issuance of common shares for services $0.05 per share | 450,000 | 45 | 22,455 | - | 22,500 | |||||||||||||||||||||||
Issuance of common shares for services $0.13 per share | 50,000 | 5 | 6,495 | - | 6,500 | |||||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 400,000 | 40 | - | - | 40 | |||||||||||||||||||||||
Issuance of preferred shares for services $0.10 per share | - | - | 50,000 | 5 | 4,995 | - | 5,000 | |||||||||||||||||||||
Issuance of common shares for services $0.09 per share | 100,000 | 10 | 8,990 | - | 9,000 | |||||||||||||||||||||||
Issuance of common shares for services $0.05 per share | 250,000 | 25 | 12,475 | - | 12,500 | |||||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 700,000 | 70 | 630 | - | 700 | |||||||||||||||||||||||
Issuance of common shares upon partial conversion of note at $0.0001 per share | 1,000,000 | 100 | 900 | - | 1,000 | |||||||||||||||||||||||
Net loss | - | - | - | - | - | (224,173 | ) | (224,173 | ) | |||||||||||||||||||
Balance - September 30, 2014 | 19,881,750 | $ | 1,988 | 50,000 | $ | 5 | $ | 255,515 | $ | (554,429 | ) | $ | (296,921 | ) |
See accompanying summary of notes to unaudited condensed financial statements.
5 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Condensed Statements of Cash Flows
For the Nine Months Ended September 30, 2014 and 2013 and for the Period
From November 8, 2010 (Inception) to September 30, 2014
From November 8, 2010 (Inception) to September 30, | For
the Nine Months Ended September 30, | |||||||||||
2014 | 2014 | 2013 | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net loss | $ | (554,429 | ) | $ | (224,173 | ) | $ | (59,449 | ) | |||
Adjustments to reconcile net loss to net cash used by operating activities: | ||||||||||||
Common stock issued for services | 139,675 | 125,500 | - | |||||||||
Depreciation expense | 1,194 | 635 | 119 | |||||||||
Accounts receivable | (30,755 | ) | (30,755 | ) | - | |||||||
Prepaid expenses | (3,900 | ) | (1,400 | ) | - | |||||||
Inventory | (9,400 | ) | (1,900 | ) | - | |||||||
Security deposit | (1,065 | ) | (800 | ) | - | |||||||
Bank overdraft | - | (1,644 | ) | - | ||||||||
Accounts payable and accrued expenses | 299,532 | 67,574 | (2,306 | ) | ||||||||
Interest/excess of fair value of shares issued to repay loans | 26,790 | 26,790 | - | |||||||||
Preferred stock issued for services | 5,000 | 5,000 | - | |||||||||
Net cash used by operating activities | (127,358 | ) | (35,173 | ) | (61,636 | ) | ||||||
Cash flows from investing activities: | ||||||||||||
Purchase of equipment | (8,314 | ) | (2,556 | ) | - | |||||||
Net cash used by investing activities | (8,314 | ) | (2,556 | ) | - | |||||||
Cash flows from financing activities: | ||||||||||||
Proceeds from issuance of common stock | 86,043 | 35,000 | - | |||||||||
Due to related party | 8,752 | 8,752 | ||||||||||
Shareholder's loan | 44,935 | 3,080 | 597 | |||||||||
6% convertible notes | 7,975 | (790 | ) | 30,000 | ||||||||
Net cash provided by financing activities | 147,705 | 46,042 | 30,597 | |||||||||
Net increase in cash | 12,033 | 8,313 | (31,039 | ) | ||||||||
Cash at beginning of period | - | 3,720 | 33,409 | |||||||||
Cash at end of period | $ | 12,033 | $ | 12,033 | $ | 2,370 | ||||||
Supplemental cash flow information: | ||||||||||||
Cash paid during the period for: | ||||||||||||
Interest | $ | 3,740 | $ | 601 | $ | 436 | ||||||
Income taxes | $ | 750 | $ | 750 | $ | - |
See accompanying summary of notes to unaudited condensed financial statements.
6 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
Medifirst Solutions, Inc. was incorporated in Nevada in November 2010. We are in the development stage and have a diverse product line including products for both consumers and professionals. Since our inception, we have been engaged in business planning activities, including researching the industry, identifying target markets for our products, developing our models and financial forecasts, performing due diligence regarding potential geographic locations most suitable for establishing our offices and identifying future sources of capital. At the present time, The Company building products and affiliations in and related to the cosmetic healthcare industry. We are developing products and programs in the anti-aging sector using laser technology as well as LED Light Therapy. The Company is a dealer for Atmospheric Water Solutions, Inc. to sell water machines that makes drinking water from air. We are in development for a website about Ebola with the domain ebolasaftey.com.
Basis of Presentation
The accompanying unaudited financial statements of MSI have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to such principles and regulations of the Securities and Exchange Commission for Form 10-Q. All adjustments, consisting of normal recurring adjustments, have been made which, in the opinion of management, are necessary for a fair presentation of the results of interim periods. The results of operations for such interim periods are not necessarily indicative of the results that may be expected for a full year because of, among other things, seasonality factors in the retail business. The unaudited financial statements contained herein should be read in conjunction with the audited financial statements and notes thereto for the fiscal year ended December 31, 2013.
Revenue Recognition
In general, the Company records revenue when persuasive evidence of an arrangement exists, services have been rendered or product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The following policies reflect specific criteria for the various revenues streams of the Company:
Revenue is recognized at the time the product is delivered or services are performed. Provision for sales returns are estimated based on the Company's historical return experience. Revenue is presented net of returns.
7 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.
Segment Information
The Company follows Accounting Standards Codification ("ASC") 280, "Segment Reporting". The Company currently operates in a single segment and will evaluate additional segment disclosure requirements as it expands its operations.
Net Income (Loss) Per Common Share
The Company calculates net income (loss) per share based on the authoritative guidance. Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares and dilutive common stock equivalents outstanding. During periods in which the Company incurs losses common stock equivalents, if any, are not considered, as their effect would be anti-dilutive.
Income Taxes
Deferred income taxes are recognized for the tax consequences related to temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for tax purposes at each year end, based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. A valuation allowance is recognized when, based on the weight of all available evidence, it is considered more likely than not that all, or some portion, of the deferred tax assets will not be realized. Income tax expense is the sum of current income tax plus the change in deferred tax assets and liabilities.
ASC 740, Income Taxes, requires a company to first determine whether it is more likely than not (which is defined as a likelihood of more than fifty percent) that a tax position will be sustained based on its technical merits as of the reporting date, assuming that taxing authorities will examine the position and have full knowledge of all relevant information. A tax position that meets this more likely than not threshold is then measured and recognized at the largest amount of benefit that is greater than fifty percent likely to be realized upon effective settlement with a taxing authority.
8 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Stock-Based Compensation
The Company accounts for equity instruments issued to employees in accordance with ASC 718, Compensation - Stock Compensation. ASC 718 requires all share-based compensation payments to be recognized in the financial statements based on the fair value using an option pricing model. ASC 718 requires forfeitures to be estimated at the time of grant and revised in subsequent periods if actual forfeitures differ from initial estimates.
Equity instruments granted to non-employees are accounted for in accordance with ASC 505, Equity. The final measurement date for the fair value of equity instruments with performance criteria is the date that each performance commitment for such equity instrument is satisfied or there is a significant disincentive for non-performance.
Cash and Cash Equivalents
The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash equivalents were approximately $2,100 at September 30, 2014.
Inventory
Inventory consists of finished goods and is stated at the lower of cost (first-in, first-out) or market value.
Equipment
Equipment, consisting of computer equipment, is stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, of five years.
The Company reviews long-lived assets, such as equipment, for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds the estimated future cash flows, an impairment loss will be recorded by the amount the carrying value exceeds the fair value of the asset.
Recent Pronouncements
There are no recent accounting pronouncements that apply to the Company.
9 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 2. PROPERTY, PLANT AND EQUIPMENT (NET)
Equipment is recorded at cost and consisted of the following at September 30, 2014:
Computer equipment | $ | 8,314 | ||
Less: accumulated depreciation | (1,194 | ) | ||
$ | 7,120 |
Depreciation expense was $635 and $173 for the nine months ended September 30, 2014 and 2013, respectively.
Note 3. DUE TO RELATED PARTY
During the period ended September 30, 2014, a related party through common management advanced the Company $8,752 to pay certain expenses. The loan bears no interest and is payable on demand.
Note 4. LOANS PAYABLE - STOCKHOLDERS
During the periods ended September 30, 2014 and 2013 a stockholder of the Company advanced the Company $20,231 and 19,253, to pay for certain expenses. The loan has a balance of $34,435 at September 30, 2014, bears no interest and is payable on demand.
At September 30, 2014 the Company was indebted to a stockholder in the amount of $5,000. The loan has an interest rate of 20%. Principal and accrued interest were due and payable on July 2, 2012.
In December 2012, the Company issued a promissory note to a stockholder in the amount of $5,000 with interest at 10% per annum. Principal and interest were due and payable on June 2, 2013. In April 2014, the note was amended to provide the note holder with the privilege to convert the note to the Company's common stock at $0.0001 per share. In July 2014, in a private transaction, the note holder transferred $1,000 of note principal to a third party. In August 2014, the holder of this portion of note principal converted it into 1,000,000 shares of the Company's common stock. At September 30, 2014, $4,000 of the original note principal remains due and payable.
At September 30, 2014 the Company was indebted to a stockholder in the amount of $1,500. The loan has an interest rate of 26.7%. Principal and accrued interest were due and payable on January 1, 2014.
10 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 5. 6% CONVERTIBLE NOTES
In March 2011, the Company issued $800 aggregate principal amount of 6% convertible notes due in January 2012. Interest on the notes accrue at the rate of 6% per annum and are payable when the notes mature. The notes matured prior to conversion but have not been repaid. Interest continues to accrue at the rate of 6% per annum.
The holder of one of the notes converted $110 of note principal into 1,100,000 shares of common stock as follows:
Date of Conversion | Principal Amount Converted | Conversion Rate | Shares Received | |||||||||
June 2013 | $ | 70 | $ | 0.0001 | 700,000 | |||||||
August 2013 | $ | 40 | $ | 0.0001 | 400,000 |
In August 2013, in a private transaction, the same note holder transferred $330 of the remaining note principal plus $55 in accrued interest to a third party.
In August 2013, in a private transaction, the new note holder transferred $5 of the remaining note principal to a third party who then converted the note into 50,000 shares of common stock.
In September 2013, the new note holder converted $100 of note principal into 1,000,000 shares of common stock.
In September 2013, in a private transaction, the new note holder transferred $35 of the remaining note principal to a third party who then converted the note into 350,000 shares of common stock.
In November and December 2013, the new note holder converted an additional $90 of note principal into 900,000 shares of common stock as follows:
Date of Conversion | Principal Amount Converted | Conversion Rate | Shares Received | |||||||||
November 2013 | $ | 40 | $ | 0.0001 | 400,000 | |||||||
December 2013 | $ | 50 | $ | 0.0001 | 500,000 |
In March 2014, the new note holder converted $50 of note principal into 500,000 shares of common stock.
11 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 5. 6% CONVERTIBLE NOTES (continued)
In April 2014, the new note holder converted $40 of note principal into 400,000 shares of common stock.
Subsequent to these conversions there remains $125 in note principal.
In July 2013, the holder of the second note converted $240 of note principal into 400,000 shares of the Company's common stock at $0.0006 per share. At September 30, 2014, the note had a remaining principal balance of $60.
At any time on or after the maturity date, the holders of the notes, have the option of converting any of the unpaid principal and interest into the Company's common stock. The notes plus any accrued but unpaid interest are convertible at the rate of $0.0001 per share at the time of conversion up to a maximum of 9.99% of the then issued and outstanding common stock, or 1,986,187 shares at September 30, 2014.
In May 2012, the Company issued a $25,000 6% per annum note that matured in November 2012. In December 2012 the note was amended to be a convertible note. Interest on the note accrues interest at 6% per annum and is payable when the note matures.
The holder of the $25,000 note had the option of converting it at any time prior to maturity. The note plus any accrued but unpaid interest were convertible at the rate of $0.001 per share at the time of conversion up to a maximum of 9.99% of the then issued and outstanding common stock. The holder of the note converted $1,010 of note principal into 1,010,000 shares of common stock as follows:
The holder of the note converted $1,010 of note principal into 1,010,000 shares of common stock as follows:
Date of Conversion | Principal Amount Converted | Conversion Rate | Shares Received | |||||||||
December 2012 | $ | 150 | $ | 0.001 | $ | 150,000 | ||||||
January 2013 | $ | 660 | $ | 0.001 | $ | 660,000 | ||||||
March 2013 | $ | 200 | $ | 0.001 | $ | 200,000 |
In July 2013, the note was reduced by $14,000 to reflect consulting services provided by the Company to the note holder.
12 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 5. 6% CONVERTIBLE NOTES (continued)
In July 2013, in a private transaction, the note holder transferred the remaining note principal balance of $9,900 to a third party.
In July 2013, the note holder converted $300 of note principal into 300,000 shares of the Company's common stock. The remaining principal on this portion of the note at September 30, 2014 is $4,815. The note holder has the option of converting the balance at any time with the approval of the Board of Directors. The note plus any accrued but unpaid interest are convertible at the rate of $0.001 per share at the time of conversion up to a maximum of 9.99% of the then issued and outstanding common stock, or 1,986,187 shares at September 30, 2014.
In August 2013, in a private transaction, the new note holder transferred $4,475 of principal to a stockholder of the company.
In September 2013, the note holder converted $400 of note principal into 400,000 shares of the Company's common stock at $0.001 per share.
In August 2013, the note holder/stockholder converted $700 of note principal into 700,000 shares of the Company's common stock at $0.001 per share. In October 2013, in a private transaction, this note holder transferred $1,000 of note principal to a third party of which $700 was converted into 700,000 shares in June 2014. The remaining principal balance on this portion of the note at September 30, 2014 is $2,075. The note holder has the option of converting the balance at any time with the approval of the Board of Directors. The note plus any accrued but unpaid interest are convertible at the rate of $0.001 per share at the time of conversion up to a maximum of 9.99% of the then issued and outstanding common stock, or 1,986,298 shares at September 30, 2014.
Note 6. STOCKHOLDERS' EQUITY
In November 2010, the Company issued 752.000 shares of common stock at par value for services provided to the Company.
In November 2010, the Company issued 81,250 shares of common stock at $0.08 per share.
In November 2010, the Company issued 37,500 shares of common stock at $0.08 per share.
13 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 6. STOCKHOLDERS' EQUITY (continued)
In December 2010, the Company issued 125,000 shares of common stock at $0.08 per share.
In December 2010, the Company issued 187,500 shares of common stock at $0.00133 per share.
In December 2010, the Company issued 12,500 shares of common stock at $0.02 per share.
In December 2010, the Company issued 125,000 shares of common stock at $.08 per share for services provided to the Company.
In December 2010, the Company issued 25,000 shares of common stock at $0.01 per share.
In December 2010, the Company issued 315,000 shares of common stock at $0.002 per share.
In January 2011, the Company issued 250,000 shares of common shares at $0.0034 per share.
In January 2011, the Company issued 25,000 shares of common shares at $0.01 per share.
In January 2011, the Company issued 12,500 shares of common shares at $0.016 per share.
In March 2011 the Company issued 75,000 shares of common stock at $0.0019 per share.
In March 2011 the Company issued 250,000 shares of common stock at $0.0014 per share.
In March 2011, the Company issued 3,750,000 shares of common stock to an officer of the Company for services provided to the Company at $0.002 per share.
In April 2011, the Company issued 300,000 shares of common stock at $0.0167 per share.
14 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 6. STOCKHOLDERS' EQUITY (continued)
In October 2011, the Company issued 20,000 shares of common stock at $0.08 per share for services provided to the company.
In October 2011, the Company issued 6,250 shares of common stock at $0.08 per share.
In November 2011, the Company issued 53,500 shares of common stock at $0.08 per share.
In November 2011, the Company issued 12,500 shares of common stock at $0.08 per share.
In December 2011, the Company issued 100,000 shares of common stock at $0.04 per share.
In December 2011, the Company issued 6,250 shares of common stock at $0.08 per share.
In December 2012, the Company issued 150,000 shares of common stock at $0.001 per share as partial conversion of a note (See note 4).
In January 2013, the Company issued 660,000 shares of common stock at $0.001 per share as partial conversion of a note (See note 4).
In March 2013, the Company issued 200,000 shares of common stock at $0.001 per share as partial conversion of a note (See note 4).
In June 2013, the Company issued 700,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In July 2013, the Company issued 50,000 shares of common stock at $0.10 per share under the terms of a consulting agreement (See note 6).
In July 2013, the Company issued 400,000 shares of common stock at $0.0006 per share as partial conversion of a note (See note 4).
In July 2013, the Company issued 300,000 shares of common stock at $0.001 per share as partial conversion of a note (See note 4).
15 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 6. STOCKHOLDERS' EQUITY (continued)
In August 2013, the Company issued 400,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In August 2013, the Company issued 50,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In August 2013, the Company issued 700,000 shares of common stock at $0.001 per share as partial conversion of a note (See note 4).
In September 2013, the Company issued 350,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In September 2013, the Company issued 300,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In September 2013, the Company issued 350,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In October 2013, the Company issued 400,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In October 2013, the Company issued 1,000,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In October 2013, the Company issued 350,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In November 2013, the Company issued 400,000 shares of common stock at $0.001 per share as partial conversion of a note (See note 4).
In December 2013, the Company issued 500,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In February 2014, the Company issued 1,000,000 shares of common stock at $0.05 per share for services provided to the Company.
In February 2014, the Company issued 500,000 shares of common stock at $0.05 per share for services provided to the Company.
16 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 6. STOCKHOLDERS' EQUITY (continued)
In February 2014, the Company issued 450,000 shares of common stock at $0.0555 per share to pay accrued expenses.
In March 2014, the Company issued 200,000 shares of common stock at $0.05 per share.
In March 2014, the Company issued 300,000 shares of common stock at $0.05 per share.
In March 2014, the Company issued 200,000 shares of common stock at $0.05 per share.
In March 2014, the Company issued 500,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In March 2014, the Company issued 450,000 shares of common stock at $0.05 per share for services provided to the Company.
In April 2014, the Company issued 50,000 shares of common stock at $0.13 per share for services provided to the Company.
In April 2014, the Company issued 400,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In May 2014, the Company issued 100,000 shares of common stock at $0.09 per share for services provided to the Company.
In May 2014, the Company issued 250,000 shares of common stock at $0.05 per share for services provided to the Company.
In June 2014, the Company issued 700,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
In August 2014, the Company issued 1,000,000 shares of common stock at $0.0001 per share as partial conversion of a note (See note 4).
17 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 7. COMMITMENTS AND CONTINGENCIES
In May 2014, the Company began leasing its current office space on a month to month basis at the rate of $525 per month.
Under the terms of this lease rent expense for the nine months ended September 30, 2014 totaled $3,212.
In July 2013, the Company entered into a consulting agreement with an individual for a one year term. Under the terms of this agreement the Company agreed to compensate the consultant with 100,000 shares of the Company's common stock. As of September 30, 2013 the consultant received 50,000 shares of the Company's common stock valued its the fair market value of $0.10 per share (See note 5). At September 30, 2014 and 2013, $2,500 and $2,500 has been recorded as an expense, respectively.
Note 8. INCOME TAXES
The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes. The sources and tax effects of the differences are as follows:
Income tax provision at the federal statutory rate | 39 | % | ||
Effect of operating losses | (39 | )% | ||
0 | % |
As of September 30, 2014, the Company has a net operating loss carryforward of approximately $547,000. This loss will be available to offset future taxable income. If not used, this carryforward will begin to expire in 2030. The deferred tax asset relating to the operating loss carryforward has been fully reserved at September 30, 2014. The principal difference between the operating loss for income tax purposes and reporting purposes results from the issuance of common shares for services.
Note 9. BASIS OF REPORTING
The Company's financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.
18 |
Medifirst Solutions, Inc.
(A Development Stage Company)
Notes to Condensed Financial Statements
September 30, 2014
Note 9. BASIS OF REPORTING (continued)
The Company has experienced a loss from operations during its development stage as a result of its investment necessary to achieve its operating plan, which is long-range in nature. For the period from inception to September 30, 2014, the Company incurred a net loss of approximately $554,000. In addition, the Company has no significant assets or revenue generating operations.
The Company currently does not have sufficient cash to sustain itself for the next 12 months, and will require additional funding in order to execute its plan of operations and to continue as a going concern. To meet its cash needs, management expects to raise capital through a private placement offering. In the event that this funding does not materialize, certain stockholders have agreed, orally, to loan, on a non-interest bearing demand basis, sufficient funds to maintain the Company's operations for the next 12 months.
The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.
Note 10. SUBSEQUENT EVENTS
In October 2014, the Company incorporated a wholly owned subsidiary in Nevada for the purpose of acquiring certain assets of an unrelated third party.
In October 2014, the Company's subsidiary (see above) entered into an asset purchase agreement that calls for the subsidiary to purchase substantially all of the target company's operating assets for $250,000. The purchase price is payable on the 12 month anniversary of the acquisition and is payable in the Company's common stock. The number of shares is to be determined based upon the market value of the stock at that future date.
In October 2014, two note holders partially converted their notes for 2,600,000 shares of the Company's common stock at $0.001 per share.
In October 2014, a note holder partially converted his note for 500,000 shares of the Company's common stock at $0.0001 per share.
19 |
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
This section must be read in conjunction with the Audited Financial Statements included in this Prospectus.
Plan of Operation
Medifirst Solutions, Inc. was incorporated in Nevada in November 2010. We are in the development stage and have a diverse product line including products for both consumers and professionals. Since our inception, we have been engaged in business planning activities, including researching the industry, identifying target markets for our products, developing our models and financial forecasts, performing due diligence regarding potential geographic locations most suitable for establishing our offices and identifying future sources of capital. At the present time, The Company building products and affiliations in and related to the cosmetic healthcare industry. We are developing products and programs in the anti-aging sector using laser technology as well as LED Light Therapy. The Company is a dealer for Atmospheric Water Solutions, Inc. to sell water machines that makes drinking water from air. We are in development for a website about Ebola with the domain ebolasaftey.com.
See “Description of Business” contained herein.
Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for the next twelve (12) months. Our auditors’ opinion is based on the uncertainty of our ability to establish profitable operations. The opinion results from the fact that we have not generated significant revenues. Accordingly, we must raise cash from operations or from investments by others in our Company to continue our operations.
Our sole officer and director is responsible for our managerial and organizational structure, which will include preparation of disclosure and accounting controls under the Sarbanes Oxley Act of 2002. When these controls are implemented, he will be responsible for the administration of the controls. Should he not have sufficient experience, he may be incapable of creating and implementing the controls which may cause us to be subject to sanctions and fines by the SEC which ultimately could cause you to lose your investment.
Our intended plan of operations is to generate revenue from our diverse divisions of operation. We believe that diversification of our interests will help generate revenues.
Cosmetic and Anti-Aging Division
Medifirst continues to develop its division that focuses on anti-aging and non-invasive and minimally invasive cosmetic procedures. We are in development of a mobile laser unit and a treatment protocol for wrinkles, hyperpigmentation, skin spots, acne and various skin related concerns. The Company also incorporates LED Light Therapy in which it is also a distributor. Medifirst has completed an acquisition that will effectively be a great synergy with out current products. Effective October 31, 2014, the Company’s newly-formed wholly-owned subsidiary, Dr. Park Avenue, Inc., a Nevada corporation (“Subsidiary”), entered into an Asset Purchase Agreement (“Agreement”) to acquire all of the assets of Dr. Park Ave. located in Franklin Lakes, New Jersey. (“Dr. Park Ave. New Jersey”). The Subsidiary will continue to operate the out-patient cosmetic surgery office formerly operated by Dr. Park Ave New Jersey at the Franklin Lakes, New Jersey facility. Paul Fondacaro M.D., the medical director of Dr. Park Avenue New Jersey, is the President, Chief Medical Officer and a director of the Subsidiary.
Atmospheric Water Solutions
The Company is a dealer and sales representative for Atmospheric Water Solution (“AWS”), a Florida based company that generates water by using an advanced patented technology. The water generating machines extract water directly from the air we breathe. By using a patented, advanced filtration and purification system, AWS machines purify water to the cleanest, purest standards in the world. The Company is the exclusive distributor for tradeshows within the US for the entire spa and wellness industry and will seek to expand to international sales as well. The units operate on standard 110V power and on average one gallon of water generated will cost about 10 cents. The units start as a table top model generating up to three gallons a day to large standing machines making up to 400 gallons a day.
Ebola Division
The Company has created a new division to address the Ebola virus and potential outbreaks across the country. The Ebola virus is one of the greatest possible threats to ever hit the United States. In just two months, the Ebola outbreak that has spiraled out of control in West Africa and is spreading to the U.S., could see 10,000 new cases every week, according to the World Health Organization. The latest projection outlines a dire situation, as the deadliest Ebola outbreak in history has health officials across the globe scrambling and struggling to identify, treat and prevent the disease that has no cure or vaccine. The Company has acquired the domain www.ebolasafety.com. The website, currently being developed, will focus on industry products, services and education.
Marijuana
Since the medical marijuana ballot initiative did not get voter approval in Florida, the Company will not be pursuing any business related to legal marijuana or any products that service the industry.
20 |
Results of Operations
Quarterly Period Ended September 30, 2014
Revenues
During the nine months ended September 30, 2014 and 2013, we generated $82,127 and $50,049 in revenues, respectively.
Cost of good sold for the nine months ended September 30, 2014 and 2013 was $45,895 and $5,941, respectively.
We expect revenues for the short term to remain minimal, however we believe revenues will increase after execution of our business plans.
Expenses
For the nine months ended September 30, 2014 and 2013, expenses were $258,326 and $113,207, respectively.
We expect expenses for 2014 to trend upward as we continue to incur additional expenses necessary to grow our business.
Legal and Accounting
For the nine months ended September 30, 2014 and 2013 professional fees were $160,363 and $10,684, respectively.
We expect professional fees for 2014 to trend marginally downward as we pursue operations in the ordinary course of business, though we will continue to incur additional expenses as a result of our being a publicly traded company. This includes corporate legal, accounting, stockholder and SEC filing expenses.
Other Income/(Expense)
For the nine months ended September 30, 2014 and 2013, other expenses was $1,329 and $1,405, respectively.
Other expense for the nine months ended September 30, 2014 and 2013 consisted of interest expense.
Net Income/(Loss)
For the nine months ended September 30, 2014 and 2013 the company had a net loss of $224,173 and $70,504.
Liquidity and Capital Resources
Since incorporation, we have financed our operations through the private placement of our common stock to selected investors and periodic borrowings from our stockholders. At September 30, 2014 and 2013, our principal sources of liquidity included cash and cash equivalents of $12,033 and $3,720, respectively.
As of September 30, 2014, we did not have any significant commitments for capital expenditures.
If we do not generate sufficient cash flow to support our operations over the next twelve (12) months, in order to continue as a going concern we may need to raise additional capital by issuing capital stock in exchange for cash. There are no formal or informal agreements to attain such financing. The Company’s ability to obtain additional capital on acceptable terms is subject to a variety of uncertainties, including: investors’ perception of, and demand for, securities of companies in our industry; conditions of the U.S. and other capital markets in which we may seek to raise funds; future results of operations, financial condition and cash flow. Therefore, the Company’s management cannot assure that financing will be available in amounts or on terms acceptable to the Company, or if at all. Any failure by the Company’s management to raise additional funds on terms favorable to the Company could have a material adverse effect on the Company’s liquidity and financial condition.
21 |
Critical Accounting Policies
Our significant accounting policies are summarized in Note 1 of our consolidated financial statements. While all these significant accounting policies impact our financial condition and results of operations, we view certain of these policies as critical. Policies determined to be critical are those policies that have the most significant impact on our financial statements and require management to use a greater degree of judgment and estimates. Actual results may differ from those estimates. Our management believes that given current facts and circumstances, it is unlikely that applying any other reasonable judgments or estimate methodologies would cause an effect on our consolidated results of operations, financial position or liquidity for the periods presented in this report.
Off Balance Sheet Arrangements
The Company has no off-balance sheet arrangements.
Recently Adopted Accounting Pronouncements
Please see Note 2 of our consolidated financial statements that describe the impact, if any, from the adoption of Recent Accounting Pronouncements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
The Company is a smaller reporting company, as defined by Rule 229.10(f)(1) and is not required to provide the information required by this Item.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Our management has evaluated, under the supervision and with the participation of our principal executive and principal financial officers, the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (the “Exchange Act”). Based on that evaluation, our principal executive and financial officers concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective in ensuring that information required to be disclosed in our Exchange Act reports is (1) recorded, processed, summarized and reported in a timely manner, and (2) accumulated and communicated to our management, including our principal executive and financial officers, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
22 |
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Recent Sales of Unregistered Securities
On July 30, 2014, the Company issued 300,000 shares of restricted common stock pursuant to a subscription agreement.
On August 6, 2014, the Company issued 200,000 shares of restricted common stock pursuant to a subscription agreement.
On August 21, 2014, the Company issued 1,000,000 shares of common stock to a holder of convertible promissory notes upon the exercise of conversion rights by the holder.
Each of these transactions was exempt from the registrations requirements of the Securities Act of 1933, as amended, pursuant to Section (a) (2) thereof. In the alternative, the shares issued upon the exercise of conversion rights is an exempt security under Section 3(a)(9) of the Securities Act of 1933, as amended.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
None
Item 3. Defaults Upon Senior Securities.
None
Item 4. Mine Safety Disclosures
Not applicable
Item 5. Other Information.
None
Item 6. Exhibits.
31.1 | Certification of the Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2 | Certification of the Chief Executive Officer and Principal Executive Officer Pursuant to 13a-14 and 15d-14 of the Securities Exchange Act of 1934. |
32.1 | Certification of the Chief Financial Officer and Principal Financial Officer Pursuant to 13a-14 and 15d-14 of the Securities Exchange Act of 1934. |
23 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this quarterly report to be signed on its behalf by the undersigned hereunto duly authorized.
November 18, 2014 | ||
By | /s/ Bruce Schoengood | |
Bruce Schoengood | ||
Chief Executive Officer | ||
(Principal Executive Officer) | ||
By | /s/ Bruce Schoengood | |
Bruce Schoengood | ||
Chief Financial Officer | ||
(Principal Financial Officer) |
24