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 SEPTEMBER 30, 2015

 

Commission file number 333-198720

 

MP VENTURES, INC.

 

(Exact name of registrant as specified in its charter)

 

Nevada

(State or other jurisdiction of incorporation or organization)

 

VCorp Services, LLC, 1645 Village Center Circle, Suite 170, Las Vegas, NV 89134

(Address of principal executive offices, including zip code.)

 

(888) 528-2677

(Telephone number, including area code)

 

310 Olive St., Long Beach, NY 11561

(Former name, former address and former fiscal year, if changed since last report)

 

 

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 last 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  x   NO ¨

 

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," "non-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

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES  ☒   NO ☐

 

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 36,263,500 shares as of November 3, 2015.

 

  

Financial Statements

 

MP Ventures, Inc.

 

For the Three and Nine Months Ended September 30, 2015 (unaudited)

 

  

MP Ventures, Inc.

 

Contents	Page
Financial Statements:
Balance Sheet at September 30, 2015 (unaudited) and December 31, 2014 (unaudited)	4
Statements of Operations for the three months ended September 30, 2015(unaudited) and 2014(unaudited) and the nine months ended September 30, 2015(unaudited) and  the period April 14, 2014(inception to September 30, 2014(unaudited)	5
Statements of Cash Flows  for the nine months ended September 30,  2015(unaudited) and the period April 14, 2014(inception to September 30, 2014(unaudited)	6-7
Notes to Financial Statements	8-12

 

  

ITEM 1. FINANCIAL STATEMENTS

 

MP VENTURES, INC.

BALANCE SHEET

(Unaudited)

 

		September 30, 2015				December 31, 2014
Assets
Current assets
Cash and cash equivalents		$	8,769			$	6,824
Accounts receivable			0				0
Total Current assets			8,769				6,824
Total Assets		$	8,769			$	6,824
Liabilities and Equity
Current liabilities
Accrued Expenses		$	2,000			$	5,500
Total Current Liabilities			2,000				5,500
Commitments and Contingencies - Note 6
MP VENTURES, INC. Shareholders' Equity
Common Stock, $0.0001 par value; 75,000,000 shares authorized, 36,263,500 and 35,000,000 issued and outstanding 9/30/15 & 12/31/14
Common Stock			3,626				3,500
Contributed capital in excess of par			15,924				(2,000	)
Retained Earnings			(12,781	)			(176	)
Total Equity(Deficit)			6,769				1,324
Total liabilities and equity(Deficit)		$	8,769			$	6,824

 

"The accompanying notes are an integral part of these financial statements"

 

 

MP VENTURES, INC.

STATEMENT OF OPERATIONS

(Unaudited)

 

		For the Three Months Ended September 30, 2015				For the Three Months Ended September 30, 2014				For the Nine Months Ended September 30, 2015				For the period 4/14/2014(Inception to 9/30/2014
Revenues		$	0			$	6,000			$	3,000			$	8,000
Operating Expenses			1,050				362				15,605				8,188
Net Income(Loss) from Operations			(1,050	)			5,638				(12,605	)			(188	)
Other Income(Expenses)
Interest Expense			0				0				0				0
Net Income(Loss) from Operations Before Income Taxes			(1,050	)			5,638				(12,605	)			(188	)
Tax Expense			0				0				0				0
Net Income(Loss)		$	(1,050	)		$	5,638			$	(12,605	)		$	(188	)
Basic and Diluted Loss Per Share			(0.000	)			0.000				(0.000	)			(0.000	)
Weighted average number of shares outstanding			36,253,500				35,000,000				36,561,556				35,210,583

 

"The accompanying notes are an integral part of these financial statements"

 

 

MP VENTURES, INC.

STATEMENT OF CASH FLOWS

(Unaudited)

 

		For the Nine Months Ended September 30, 2015				For the period 4/14/2014(Inception to 9/30/2014
Cash flows from operating activities:
Net income (loss)		$	(12,605	)		$	(188	)
(Increase)decrease in accounts receivable			0				0
Increase(decrease) in accrued expenses			(3,500	)			7,038
Net cash used in operating activities			(16,105	)			6,850
Cash flows from investing activities:
None			0				0
Net cash provided(used) by investing activities			0				0
Cash flows from financing activities:
Sale of common stock			18,050				1,500
Net cash provided(used) by financing activities			18,050				1,500
Increase in cash and equivalents			1,945				8,350
Cash and cash equivalents at beginning of period			6,824				0
Cash and cash equivalents at end of period		$	8,769			$	8,350

 

"The accompanying notes are an integral part of these financial statements"

  

MP VENTURES, INC.

STATEMENT OF CASH FLOWS - CONTINUED

 

		For the Nine Months Ended September 30, 2015				For the period 4/14/2014(Inception to 9/30/2014
		(Unaudited)				(Unaudited)
SUPPLEMENTAL DISCLOSURE OFCASH FLOW INFORMATION
None		$	0			$	0
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
None		$	0			$	0

 

"The accompanying notes are an integral part of these financial statements"

 

  

MP Ventures, Inc.

Notes to Financial Statements

as of September 30, 2015

 

Note 1.     Organization, History and Business

 

MP Ventures, Inc. (“the Company”) was incorporated in Nevada on April 14, 2014 with a December 31, year end.

 

The Company was established for the purpose of property management and consulting services. See Note 9, Subsequent Events.

 

Note 2.     Summary of Significant Accounting Policies

 

Revenue Recognition

 

Revenue is derived from sales of products to distributors and consumers. Revenue is recognized in accordance with Staff Accounting Bulletin (“SAB”) No. 101, “Revenue Recognition in Financial Statements,” as revised by SAB No. 104. As such, the Company recognizes revenue when persuasive evidence of an arrangement exists, title transfer has occurred, the price is fixed or readily determinable, and collectability is probable. Sales are recorded net of sales discounts and terms are recorded by contract.

 

Accounts Receivable

 

Accounts receivable is reported at the customers’ outstanding balances, less any allowance for doubtful accounts.  Interest is not accrued on overdue accounts receivable.

 

Allowance for Doubtful Accounts

 

An allowance for doubtful accounts on accounts receivable is charged to operations in amounts sufficient to maintain the allowance for uncollectible accounts at a level management believes is adequate to cover any probable losses.  Management determines the adequacy of the allowance based on historical write-off percentages and information collected from individual customers.  Accounts receivable are charged off against the allowance when collectability is determined to be permanently impaired.

  

Stock Based Compensation

 

When applicable, the Company will account for stock-based payments to employees in accordance with ASC 718, “Stock Compensation” (“ASC 718”).  Stock-based payments to employees include grants of stock, grants of stock options and issuance of warrants that are recognized in the consolidated statement of operations based on their fair values at the date of grant.

 

The Company accounts for stock-based payments to non-employees in accordance with ASC 505-50, “Equity-Based Payments to Non-Employees.”  Stock-based payments to non-employees include grants of stock, grants of stock options and issuances of warrants that are recognized in the consolidated statement of operations based on the value of the vested portion of the award over the requisite service period as measured at its then-current fair value as of each financial reporting date.

 

The Company calculates the fair value of option grants and warrant issuances utilizing the Binomial pricing model.  The amount of stock-based compensation recognized during a period is based on the value of the portion of the awards that are ultimately expected to vest.  ASC 718 requires forfeitures to be estimated at the time stock options are granted and warrants are issued to employees and non-employees, and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.  The term “forfeitures” is distinct from “cancellations” or “expirations” and represents only the unvested portion of the surrendered stock option or warrant.  The Company estimates forfeiture rates for all unvested awards when calculating the expense for the period.  In estimating the forfeiture rate, the Company monitors both stock option and

 

  

Note 2.     Summary of Significant Accounting Policies (continued)

 

warrant exercises as well as employee termination patterns.  The resulting stock-based compensation expense for both employee and non-employee awards is generally recognized on a straight-line basis over the period in which the Company expects to receive the benefit, which is generally the vesting period.

 

Loss per Share

 

The Company reports earnings (loss) per share in accordance with ASC Topic 260-10, "Earnings per Share." Basic earnings (loss) per share is computed by dividing income (loss) available to common shareholders by the weighted average number of common shares available. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Diluted earnings (loss) per share has not been presented since there are no dilutive securities.

 

Cash and Cash Equivalents

 

For purpose of the statements of cash flows, the Company considers cash and cash equivalents to include all stable, highly liquid investments with maturities of three months or less.

 

Concentration of Credit Risk

 

The Company primarily transacts its business with one financial institution. The amount on deposit in that one institution may from time to time exceed the federally-insured limit.

 

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 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 reporting period.  Actual results could differ from those estimates.

 

Business segments

 

ASC 280, “Segment Reporting” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company determined it has one operating segment as of September 30, 2015.

 

Income Taxes

 

The Company accounts for its income taxes under the provisions of ASC Topic 740, “Income Taxes.” The method of accounting for income taxes under ASC 740 is an asset and liability method. The asset and liability method requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between tax bases and financial reporting bases of other assets and liabilities.

 

Emerging growth Company

 

We are an “emerging growth company” as that term is used in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) and, as such, may elect to comply with certain reduced public company reporting requirements for future filings.

 

 

 

Note 2.     Summary of Significant Accounting Policies (continued)

 

Recent Accounting Pronouncements

 

On June 10, 2014, the FASB issued Accounting Standards Update (ASU) No. 2014-10, Development Stage Entities (Topic 915) – Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation, which eliminates the concept of a development stage entity (DSE) in its entirety from current accounting guidance. The Company has elected early adoption of this new standard.

 

The Company has implemented all other new accounting pronouncements that are in effect and that may impact its consolidated financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. 

 

Note 3.     Income Taxes

 

Deferred income tax assets and liabilities are computed annually for differences between financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities.

 

The effective tax rate on the net loss before income taxes differs from the U.S. statutory rate as follows:

 

		9/30/2015				9/30/2014
U.S. statutory rate			34	%			34	%
Less valuation allowance			(34	)%			(34	)%
Effective tax rate			0	%			0	%

 

The significant components of deferred tax assets and liabilities are as follows:

 

		9/30/2015				9/30/2014
Net operating losses			(12,781	)			(176	)
Deferred tax liability
Net deferred tax assets			4,346				60
Less valuation allowance			(4,346	)			(60	)
Deferred tax asset - net valuation allowance		$	0			$	0

 

  

Note 3.     Income Taxes (Continued)

  

The Company adopted the provisions of ASC 740-10-50, formerly FIN 48, and “Accounting for Uncertainty in Income Taxes”. The Company had no material unrecognized income tax assets or liabilities for the interim period as of September 30, 2015. The Company’s policy regarding income tax interest and penalties is to expense those items as general and administrative expense but to identify them for tax purposes. During the period April 14, 2014(inception) through December 31, 2014, there were no income tax, or related interest and penalty items in the income statement, or liabilities on the balance sheet. The Company files income tax returns in the U.S. federal jurisdiction and Nevada state jurisdiction. We are not currently involved in any income tax examinations.

 

Note 4.     Related Party Transactions

 

There were no related party transactions for the three months ended September 30, 2015.

 

Note 5.     Stockholders’ Equity

 

Common Stock

 

The holders of the Company's common stock are entitled to one vote per share of common stock held.

 

As of December 31, 2014 the Company had 35,000,000 shares issued and outstanding. On May 8, 2015 1,263,500 were issued for $18,050. On May 15, 2015 the Company issued a 7 for 1 stock split. All prior periods have been restated to reflect this adjustment. At September 30, 2015 there were 36,263,500 shares issued and outstanding.

 

Note 6.     Commitments and Contingencies 

 

Commitments:

 

The Company currently has no long term commitments as of our balance sheet date.

 

Contingencies:

 

None as of our balance sheet date.

 

 

Note 7 – Net Income(Loss) Per Share

 

The following table sets forth the information used to compute basic and diluted net income per share attributable to MP Ventures, Inc. for the nine months ended September 30, 2015:

 

		9/30/2015				9/30/2014
Net Income (Loss)		$	(12,605	)		$	(188	)
Weighted-average common shares outstanding  basic:
Weighted-average common stock			35,561,556				35,210,583
Equivalents
Stock options			0				0
Warrants			0				0
Convertible Notes			0				0
Weighted-average common shares outstanding-  Diluted			35,561,556				35,210,583

 

Note 8.     Going Concern

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. Currently, the Company has limited operating history and as of September 30, 2015 the Company also had limited revenues and working capital. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management believes that the Company’s capital requirements will depend on many factors including the success of the Company’s development of an alternative business plan and its efforts to raise capital. Management also believes the Company will need to raise additional capital for working capital purposes. There is no assurance that such financing will be available in the future.   The conditions described above raise substantial doubt about our ability to continue as a going concern. The financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

Note 9.     Subsequent Events

 

Subsequent to September 30, 2015, the Board of Directors of the Company concluded that it does not believe that the Company can be successful in executing its business plan, and the Company has decided to discontinue its property management and consulting services line of business.

 

Going forward, the Company intends to seek, investigate and, if such investigation warrants, engage in a business combination with another entity whose business presents an opportunity to enhance shareholder value (a “Transaction”). The Company is currently engaged in discussions regarding a potential Transaction that would result in a new strategic direction. However, other than as discussed immediately below, no definitive agreements have been negotiated or signed, and there can be no assurances that these discussions will be successful or that they will lead to the consummation of any such transaction.

 

To facilitate a possible Transaction, the Company has have entered into an agreement with Mark Poretsky, its principal executive officer, sole director and majority stockholder, pursuant to which Mr. Poretsky has agreed and irrevocably committed to enter into a split-off agreement pursuant to which, upon consummation of a Transaction, Mr. Poretsky will take ownership of a to-be-formed split-off subsidiary of the Company to which all of the pre-Transaction assets and liabilities of the Company will have been transferred in exchange for the surrender of all of the shares of Company common stock then owned by Mr. Poretsky. Additionally, Mr. Poretsky has agreed and irrevocably committed to enter into a general release agreement with the Company relating to the Split-Off effective as of the closing of a Transaction.

 

Effective November 23, 2015, Anthony Kenneth Dietsch was appointed by the Board of Directors of the Company to serve as Chief Executive Officer, President, Treasurer, Secretary and Director of the Company.

 

Mr. Dietsch, 31, is the sole proprietor of Bruno Built Remodeling, a construction management and remodeling company where he manages all aspects of construction projects including bidding, ordering materials, customer service, permit processes and sub-contractor procedure. Since 2012, Mr. Dietsch has also served as the regional coordinator for QE Productions in Los Angeles, California, where he is responsible for securing various permits for outdoor productions including circuses, carnivals and auto tent sales. From 2010 to 2011, Mr. Dietsch was an extrusion line operator for Ticona Celstran/Celanese Inc. and from 2008 to 2010, Mr. Diestch was the retail store manager of O’Reilly Auto Parts where he was responsible for hiring and training employees, merchandising products, managing store safety standards and monitoring accounts payable and accounts receivable activities. Mr. Dietsch attended Winona State University and is certified by the National Institute for Automotive Service Excellence.

 

There were no other subsequent events since the balance sheet date through the filing of this report.

 

  

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

 

Forward Looking Statements

 

This section includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward-looking states are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or out predictions.

 

General Overview

 

We were organized in the State of Nevada on April 14, 2014, for the purpose of property management and consulting services. Subsequent to September 30, 2015, our Board of Directors concluded that it does not believe that we can be successful in executing our business plan and we have decided to discontinue our property management and consulting services line of business.

 

Going forward, we intend to seek, investigate and, if such investigation warrants, engage in a business combination with another entity whose business presents an opportunity to enhance shareholder value (a “Transaction”). We are currently engaged in discussions regarding a potential Transaction that would result in a new strategic direction. However, other than as discussed immediately below, no definitive agreements have been negotiated or signed, and there can be no assurances that these discussions will be successful or that they will lead to the consummation of any such transaction.

 

To facilitate a possible Transaction, we have entered into an agreement with Mark Poretsky, our principal executive officer, sole director and majority stockholder, pursuant to which Mr. Poretsky has agreed and irrevocably committed to enter into a split-off agreement pursuant to which, upon consummation of a Transaction, Mr. Poretsky will take ownership of our to-be-formed split-off subsidiary to which all of the pre-Transaction assets and liabilities of the Company will have been transferred in exchange for the surrender of all of the shares of our common stock then owned by Mr. Poretsky. Additionally, Mr. Poretsky has agreed and irrevocably committed to enter into a general release agreement with us relating to the Split-Off effective as of the closing of a Transaction.

 

Results of Operations

 

We are still in our development stage, and in the Quarter 3 of year 2015 we did not generate any revenues. For the same three month period there were operating expenses of $1,050 for a net loss of $1,050. This is compared to $6,000 in revenues and $362 in operating expenses for a net income of $5,638 for the same period in 2014.

 

Liquidity and Capital Resources

 

We had $8,769 in cash at September 30, 2015, and there were outstanding liabilities of $2,000. This resulted in a positive Cash Flow of $1,945 for the Quarter.

 

Given our Board’s decision to seek a new business direction for the Company, we cannot at this time estimate what our capital requirements, capital resources, sources of liquidity or material commitments or contingencies may be, or identify any specific trends, events or uncertainties with respect thereto.  We will have to raise additional capital in order to carry out any new business plan, either by issuance of additional equity securities or otherwise, and there can be no assurance that we will be able to raise sufficient capital on a timely basis, on terms acceptable to us or at all. 

 

Our business is subject to all of the risks inherent in the establishment of a new business enterprise, including, but not limited to, those relating to our limited capital resources, our ability to implement a new business plan, competition and general market conditions.

 

Going Concern

 

Currently, we have a minimal operating history and have incurred operating losses, and as of September 30, 2015, we had a working capital deficit and an accumulated deficit. These factors raise substantial doubt about our ability to continue as a going concern. Management believes that our capital requirements will depend on many factors including the success of our development of an alternative business plan and our efforts to raise capital. Management also believes we will need to raise additional capital for working capital purposes. There is no assurance that such financing will be available in the future.  

 

Off-Balance Sheet Arrangements

 

We do not have any 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 is material to investors.

  

ITEM 4. CONTROLS AND PROCEDURES.

 

Evaluation of Disclosure Controls and Procedures

 

Management maintains “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

 

In connection with the preparation of this quarterly report on Form 10-Q, an evaluation was carried out by management, with the participation of the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2015.

 

Based on that evaluation, management concluded, as of the end of the period covered by this report, that our disclosure controls and procedures were effective in recording, processing, summarizing, and reporting information required to be disclosed, within the time periods specified in the Securities and Exchange Commission’s rules and forms.

 

  

Changes in Internal Controls over Financial Reporting

 

As of the end of the period covered by this report, there have been no changes in the internal controls over financial reporting during the quarter ended September 30, 2015, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting subsequent to the date of management’s last evaluation.

  

PART II. OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

To the best knowledge of the Company’s officers and directors, the Company is currently not a party to any material pending legal proceeding.

 

Item 1A. Risk Factors.

 

Not applicable as a smaller reporting company.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

 

None

 

Item 3. Defaults Upon Senior Securities.

 

None.

 

Item 4. Mine Safety Disclosures.

 

Not applicable.

 

Item 5. Other Information.

 

None.  

 

ITEM 6. EXHIBITS.

 

The following exhibits are included with this quarterly filing. Those marked with an asterisk and required to be filed hereunder, are incorporated by reference and can be found in their entirety in our original Registration Statement on Form S-1, filed under SEC File Number 333-198720, at the SEC website at www.sec.gov :

 

Exhibit No.		Description
3.1		Articles of Incorporation*
3.2		Bylaws*
31.1		Sec. 302 Certification of Principal Executive Officer & Chief Financial Officer
32.1		Sec. 906 Certification of Principal Executive Officer & Chief Financial Officer
101		Interactive data files pursuant to Rule 405 of Regulation S-T

 

*previously filed with the Commission 

 

  

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this amended report to be signed on its behalf by the undersigned thereunto duly authorized.

 

	MP VENTURES, INC.
	Registrant
Date: November 23, 2015	By:	/s/ Anthony K. Dietsch
	Name:	Anthony K. Dietsch
	Title:	Chief Executive Officer, President and Treasurer