Attached files
UNITED
STATES
SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C.
20549
FORM
10-Q/A
(Mark One)
[X] QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the quarterly period ended: March 31, 2016
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: 333-191426
SIGMABROADBAND
CO.
(Exact name of
registrant as specified in its charter)
GEORGIA
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4899
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46-1289228
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(State or other jurisdiction of
organization)
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(Primary Standard Industrial Classification
Code)
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(Tax Identification
Number)
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2690 Cobb Parkway
Suite A5-284
Smyrna, Georgia 30080
Tel: (800) 545-0010
(Address and telephone number of registrant's
executive office)
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2690 Cobb Parkway
Suite A5-284
Smyrna, Georgia 30080
Tel: (800) 545-0010
(Name, address and telephone number of agent
for service)
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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 requirement 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 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
definitions of "large accelerated filer," "accelerated filer" and
"smaller reporting company" in Rule 12b-2 of the Exchange
Act.
Large Accelerated Filer [
]
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Accelerated Filer [
]
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Non-accelerated filer [
]
(Do not check if a smaller reporting company) |
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Smaller reporting company [X]
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Indicate by check mark whether the registrant
is a shell company (as defined in rule 12b-2 of the Exchange
Act). YES [ ] NO
[X]
The number of shares outstanding of each of
the issuer’s classes of common equity, as of July 15, 2016
was 24,724,000.
EXPLANATORY NOTE
The sole purpose of
this amendment to our Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2016, originally filed with the
Securities and Exchange Commission on July 15, 2016, is due to the
Company mistakenly filing this form 10-Q by indicating by check
mark whether the registrant is a shell company (as defined in
rule 12b-2 of the Exchange Act). it indicated
YES ☒. We
are filing this amendment to our Quarterly Report on Form 10-Q to
indicate the correct statement to by indicated by check mark
whether the registrant is a shell company (as defined in
rule 12b-2 of the Exchange
Act). NO ☒. No other changes have been
made to the original filed information within this
10-Q.
SigmaBroadband Co.
Index
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Page No.
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PART I - FINANCIAL
INFORMATION
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Item 1.
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Financial
Statements
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Condensed Balance
sheets at March 31, 2016 (unaudited) and December 31,
2015
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2
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Condensed
Statements of Operations (unaudited) For the Three Months Ended
March 31, 2016 and 2015
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3
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Condensed
Statements of Cash Flows (unaudited) For the Three Months Ended
March 31, 2016 and 2015
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4
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Notes to Condensed
Financial Statements (unaudited), March 31, 2016
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5
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Item 2.
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Management's
Discussion and Analysis of Financial Condition and Results of
Operations
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10
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Item 3.
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Quantitative and
Qualitative Disclosures About Market Risk
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13
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Item 4.
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Controls and
Procedures
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13
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PART II—OTHER
INFORMATION
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Item 1.
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Legal
Proceedings
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15
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Item 2.
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Unregistered Sales
of Equity Securities and Use of Proceeds
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15
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Item 3.
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Default Upon Senior
Securities
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15
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Item
4.
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Submission of
Matters to a Vote of Security Shareholders
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15
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Item
5.
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Other
Information
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15
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Item 6.
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Exhibits
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17
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Signatures
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16
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CAUTIONARY NOTE
REGARDING FORWARD-LOOKING STATEMENTS
This quarterly report on Form 10-Q
contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, or the
Securities Act, and Section 21E of the Securities Exchange Act
of 1934, as amended, or the Exchange Act, that involve substantial
risks and uncertainties. In addition, we, or our executive officers
on our behalf, may from time to time make forward-looking
statements in reports and other documents we file with the
Securities and Exchange Commission, or SEC, or in connection with
oral statements made to the press, potential investors or others.
All statements, other than statements of historical facts,
including statements regarding our strategy, future operations,
future financial position, future revenues, projected costs,
prospects, plans and objectives of management are forward-looking
statements. The words "expect," "estimate," "anticipate,"
"predict," "believe," "think," "plan," "will," "should," "intend,"
"seek," "potential" and similar expressions and variations are
intended to identify forward-looking statements, although not all
forward-looking statements contain these identifying
words.
Forward-looking statements in this report are
subject to a number of known and unknown risks and uncertainties
that could cause our actual results, performance or achievements to
differ materially from those described in the forward-looking
statements, in this report as well as in the other documents we
file with the SEC from time to time, and such risks and
uncertainties are specifically incorporated herein by
reference.
Forward-looking statements speak only as of
the date the statements are made. Except as required under the
federal securities laws and rules and regulations of the SEC, we
undertake no obligation to update or revise forward-looking
statements to reflect actual results, changes in assumptions or
changes in other factors affecting forward-looking information. We
caution you not to unduly rely on the forward-looking statements
when evaluating the information presented in this
report.
PART
I—FINANCIAL INFORMATION
ITEM
1. FINANCIAL STATEMENTS
The financial statements of SigmaBroadband
Co. ("SigmaBroadband Co." or the "Company") as of March 31, 2016
and 2015 included herein have been prepared by the Company, without
audit, pursuant to U.S. generally accepted accounting principles
and the rules and regulations of the SEC. In addition, certain
information and note disclosures normally included in financial
statements prepared in accordance with U.S. generally accepted
accounting principles have been condensed or omitted pursuant to
such rules and regulations, although the Company believes that the
disclosures are adequate to make the information presented not
misleading. These financial statements reflect, in the opinion of
management, all adjustments (consisting only of normal recurring
adjustments) necessary to present fairly the results for the
interim periods. The results of operations for such interim periods
are not necessarily indicative of the results for the full
year.
SigmaBroadband
Co.
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Balance
Sheets
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March 31, 2016 and
December 31, 2015
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ASSETS
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March
31,
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December
31,
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2016
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2015
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(Unaudited)
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Current
Assets:
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Cash and
equivalents
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$
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270
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$
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275
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Total current
assets
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270
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275
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Equipment,
net
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—
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—
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Total
assets
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$
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270
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$
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275
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LIABILITIES AND
STOCKHOLDERS' EQUITY
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Liabilities
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Accounts payable
and accrued expenses
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$
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250,399
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$
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222,884
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Loans payable -
stockholders
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29,784
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28,574
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Note payable -
current portion
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—
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—
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Total
current liabilities
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280,183
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251,458
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Note payable - net
of current portion
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10,000,000
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10,000,000
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Commitments and
Contingencies
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—
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—
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Stockholders'
Equity:
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Preferred stock, no
par value; 10,000,000 shares authorized, no shares
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issued and
outstanding
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—
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—
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Common stock,
$0.0001 par value; 500,000,000 shares authorized,
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24,674,000 and
24,574,000 shares issued and outstanding, respectively
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2,467
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2,457
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Additional paid in
capital
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91,483
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39,993
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Common stock
to-be-issued
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25,000
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20,000
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Accumulated
deficit
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(10,398,863
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(10,313,633
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(10,279,913
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(10,251,183
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)
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Total Liabilities
and Stockholders' Equity
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$
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270
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$
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275
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SigmaBroadband
Co.
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Condensed
Statements of Operations
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For the Three
Months Ended March 31, 2016 and 2015
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(Unaudited)
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2016
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2015
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Expenses:
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Computer and
internet
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$
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30
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$
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150
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Depreciation
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—
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250,000
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Professional
fees
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62,872
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2,482
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Rent
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1,500
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1,500
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Storage
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723
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675
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Travel
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—
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1,023
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Other
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105
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3,124
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65,230
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258,954
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Net loss before
other income, expenses and income taxes
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(65,230
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)
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(258,954
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)
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Other income and
(expenses)
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Interest
expense
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(20,000
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(20,000
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Net loss before
income taxes
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(85,230
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)
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(278,954
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Provision for
income taxes
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—
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—
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Net
loss
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$
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(85,230
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)
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$
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(278,954
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Basic and diluted
loss per share
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$
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(0.00
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)
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$
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(0.01
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Basic and diluted
weighted average number
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of shares
outstanding
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24,595,501
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24,596,000
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SigmaBroadband
Co.
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Statements of Cash
Flows
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For the Three
Months Ended March 31, 2016 and 2015
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2016
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2015
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Cash flows from
operating activities:
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Net
loss
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$
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(85,230
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$
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(278,954
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Adjustments to
reconcile net loss to net cash used
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by operating
activities:
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Common stock issued
for services
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50,000
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—
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Depreciation
expense
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—
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250,000
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Stockholder
contribution
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1,500
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1,500
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Accounts payable
and accrued expenses
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32,515
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20,438
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Net cash used by
operating activities
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(1,215
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)
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(7,016
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Cash flows from
financing activities:
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Stockholder's
loan
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1,210
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5,387
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Net cash provided
by financing activities
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1,210
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5,387
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Net decrease in
cash
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(5
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)
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(1,629
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)
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Cash at beginning
of period
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275
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2,161
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Cash at end of
period
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$
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270
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$
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532
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Supplemental cash
flow information:
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Cash paid during
the period for:
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Interest
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$
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—
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$
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—
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Income
taxes
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$
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—
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$
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—
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Non-cash
transactions:
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Forgiven rent
convertible to additional paid-in capital
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$
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1,500
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$
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1,500
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Common stock
to-be-issued for services
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$
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5,000
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$
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—
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SigmaBroadband Co.
Notes to Condensed Financial
Statements
March 31, 2016
(Unaudited)
Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
Organization
SigmaBroadband Co. ("Sigma" or the "Company")
was incorporated in Georgia in October 2012. The Company has been
in the development stage since inception and has not generated any
revenue to date. The Company will be a full service,
facilities-based broadband service provider, local exchange and
inter-exchange carrier serving residential and commercial customers
with a special focus on rural areas.
Basis of
Presentation
The accompanying unaudited financial
statements 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, 2015.
Long-Lived
Assets
The Company reviews its long-lived assets for
impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. An
impairment loss is recognized when estimated future cash flows
expected to result from the use of the asset and its eventual
disposition are less than its carrying amount. Based on this
analysis an impairment loss of $8,000,000 was recognized at
December 31, 2015.
Revenue
Recognition
In general, the Company will record 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 will be recognized at the time the
product is delivered or services are performed. Provision for sales
returns will be estimated based on the Company's historical return
experience. Revenue will be presented net of returns.
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 Loss
Per Common Share
Basic net (loss) income per common share is
calculated using the weighted average common shares outstanding
during each reporting period. Diluted net (loss) income per common
share adjusts the weighted average common shares for the potential
dilution that could occur if common stock equivalents (convertible
debt and preferred stock, warrants, stock options and restricted
stock shares and units) were exercised or converted into common
stock. There were no common stock equivalents at March 31, 2015 or
2016.
SigmaBroadband Co.
Notes to Condensed Financial
Statements
March 31, 2016
(Unaudited)
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.
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.
Fair Value
of Financial Instruments
Pursuant to ASC No. 820. "Fair Value
Measurement and Disclosures," the Company is required to estimate
the fair value of all financial instruments included on its balance
sheet as of March 31, 2016. The Company's financial instruments
consist of cash, accounts payable and accrued expenses, loans
payable - stockholders, and note payable . The Company considers
the carrying value of such amounts in the financial statements to
approximate their fair value due to the short-term nature of these
financial instruments.
Reclassifications
Certain prior year
amounts have been reclassified to conform with the current year
presentation.
Recent
Pronouncements
In May 2014, FASB and IASB issued a new joint
revenue recognition standard that supersedes nearly all GAAP
guidance on revenue recognition. The core principle of the standard
is that revenue recognition should depict the transfer of goods and
services to customers in an amount that reflects the consideration
to which the entity expects to be entitled in exchange for those
goods and services. The new standard is effective for the Company
for the fiscal year beginning January 1, 2017, and the effects of
the standard on the Company’s financial statements are not
known at this time.
SigmaBroadband Co.
Notes to Condensed Financial
Statements
March 31, 2016
(Unaudited)
In March 2016, the FASB issued ASU 2016-03.
The amendments in this Update make the guidance in Updates 2014-02,
2014-03, 2014-07, and 2014-18 effective immediately by removing
their effective dates. The amendments also include transition
provisions that provide that private companies are able to forgo a
preferability assessment the first time they elect the accounting
alternatives within the scope of this Update. The Company is in the
process of evaluating the impact of the adoption of this
ASU.
In March 2016, the FASB issued ASU 2016-09,
Stock Compensation, which is intended to simplify several aspects
of the accounting for share-based payment award transactions. The
guidance will be effective for the fiscal year beginning after
December 15, 2016, including interim periods within that year. The
Company is in the process of evaluating the impact of the adoption
of this ASU.
In April 2016, the FASB issued ASU 2016-10,
Revenue from Contracts with Customer, the principle of which is
that a company should recognize revenue to record the transfer of
promised goods or services to customers in an amount that reflects
the consideration to which the company expects to be entitled for
the transfer of those goods or services by applying the following
steps:
1. Identify the contract(s) with a
customer.
2. Identify the performance obligations in
the contract(s).
3. Determine the transaction
price.
4. Allocate the transaction price to the
performance obligations in the contract.
5. Recognize revenue when, or as, the company
satisfies a performance obligation
The guidance will be effective for the fiscal
year beginning after December 15, 2016, including interim periods
within that year. The Company is in the process of evaluating the
impact of the adoption of this ASU.
NOTE 2 – EQUIPMENT, NET
The Company's furniture and equipment at
March 31, 2016 and December 31, 2015 consisted of the
following:
Telecommunications equipment
|
|
$
|
10,000,000
|
|
|
$
|
10,000,000
|
|
Less: accumulated depreciation
|
|
|
2,000,000
|
|
|
|
2,000,000
|
|
Less: impairment
|
|
|
8,000,000
|
|
|
|
8,000,000
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
—
|
|
|
$
|
—
|
|
Note 3. LOANS PAYABLE -
STOCKHOLDERS
At March 31, 2016 and December 31, 2015, a
stockholder and officer of the Company was owed $18,025 and $4,438
by the Company for funds he had advanced to pay for certain
expenses. The loan bears no interest and is payable on
demand.
At March 31, 2016 and December 31, 2015, a
stockholder and officer of the Company was owed $11,759 and $4,505
by the Company for funds he had advanced to pay for certain
expenses. The loan bears no interest and is payable on
demand.Note
SigmaBroadband Co.
Notes to Condensed Financial
Statements
March 31, 2016
(Unaudited)
4. NOTE PAYABLE
In December 2013, the Company signed an
agreement to purchase certain telecommunications equipment for $10
million. The agreement called for the Company to sign an
installment agreement for $1,000,0000. The installment agreement,
as amended in November 2015, calls for this balance to be amortized
over a six year term with interest accruing at 8% per annum.
Additionally, under the terms of this modification, payments will
begin 48 months after the signing of the original agreement
(December 2013) at which time all interest accrued until that time
will be due and payable. Interest only payments will begin in month
49 and will continue through month 72 at which time a balloon
payment of the principal and any unpaid interest will be due. At
March 31, 2016 and December 31, 2015, accrued interest on this note
totaled $224,187 and $204,187, respectively.
The amendment stipulates that the remaining
$9,000,000 owed by the Company will be paid by the issuance of
10,000,000 shares of the Company's preferred stock within 36 months
from the date of the amendment. The Company has not issued any
shares at March 31, 2016, under the terms of this
amendment.
Note 5. STOCKHOLDERS' EQUITY
The Company has authorized 500,000,000 shares
of common stock with a par value of $0.0001 per share. During the
three months ended March 31, 2016, the Company issued 100,000
shares at $0.50 per share for services provided to the company. At
March 31, 2016, 24,674,000 shares of common stock were issued and
outstanding.
In August 2014, the Company received $20,000
in payment for 20,000 shares of common stock at $1.00 per share
that are to be issued at a future date.
In March 2016, the Company authorized the
issuance of 50,000 shares of common stock at $0.10 per share, or
$5,000, for services provided to the Company. The shares were
issued in May 2016. (Note 9)
The Company has authorized 10,000,000 shares
of preferred stock with no par value. No shares were issued or
outstanding at March 31, 2016.
Note 6. COMMITMENTS AND
CONTINGENCIES
The Company currently leases its offices on a
month to month basis from the Company's President and stockholder
for $500 per month.
Rent expense for the three months ended March
31, 2016 and 2015, totaled $1,500 and $1,500, respectively, and was
capitalized as additional paid-in capital.
Note 7. INCOME TAXES
The deferred tax asset consists of the
following:March 31, 2016 December 31, 2015
|
|
March 31, 2016
|
|
December 31, 2015
|
||||
|
|
|
|
|
|
|
|
|
Net operating loss carryforward
|
|
$
|
1,710,000
|
|
|
$
|
1,676,000
|
|
Valuation allowance
|
|
|
(1,710,000
|
)
|
|
|
(1,676,000
|
)
|
Deferred tax asset, net
|
|
$
|
—
|
|
|
$
|
—
|
|
SigmaBroadband Co.
Notes to Condensed Financial
Statements
March 31, 2016
(Unaudited)
The income tax benefit differs from the
amount computed by applying the statutory federal and state income
tax rates to the loss before income before income taxes. The
sources and tax effects of the differences are as
follows:
|
|
March 31, 2016
|
|
December 31, 2015
|
||||
|
|
|
|
|
|
|
|
|
Statutory federal income tax rate
|
|
|
34
|
%
|
|
|
34
|
%
|
State income taxes, net of federal
taxes
|
|
|
6
|
%
|
|
|
6
|
%
|
Valuation allowance
|
|
|
(40
|
)%
|
|
|
(40
|
)%
|
Effective income tax rate
|
|
|
0
|
%
|
|
|
0
|
%
|
As of March 31, 2016, the Company has a net
operating loss carryforward of approximately $10,366,000. This loss
will be available to offset future taxable income. If not used,
this carryforward will begin to expire in 2033. The deferred tax
asset relating to the operating loss carryforward has been fully
reserved at March 31, 2016.
The Company currently has no federal or state
tax examinations in progress, nor has it had any federal or state
examinations since its inception. All of the Company's tax years
are subject to federal and state tax examinations. The Company is
only subject to state taxes in Georgia.
Note 8. 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.
The Company has incurred losses from
inception of approximately $10,366,000, which among other factors,
raises substantial doubt about the Company's ability to continue as
a going concern. The ability of the Company to continue as a going
concern is dependent upon management's plans to raise additional
capital from the sales of stock and receiving additional loans from
related parties.
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 9. SUBSEQUENT EVENTS
In May 2016, the Company issued the 50,000
shares of common stock that were authorized in March 2016 for
services provided to the Company. (Note 5)
ITEM
2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in
conjunction with (i) our financial statements for the three months
ended March 2016 and 2015 together with the notes to these
financial statements; and (ii) the section entitled
“Business” that appears elsewhere in this
report. The following discussion contains
forward-looking statements that reflect our plans, estimates and
beliefs. Our actual results could differ materially from those
discussed in the forward looking statements. Factors that could
cause or contribute to such differences include, but are not
limited to, those discussed below and elsewhere in this report. You
should not place undue certainty on these forward-looking
statements, which apply only as of the date of this
report. Our financial statements are stated in United
States Dollars and are prepared in accordance with United States
Generally Accepted Accounting Principles.
THIS FILING CONTAINS FORWARD-LOOKING
STATEMENTS. THE WORDS "ANTICIPATED," "BELIEVE," "EXPECT," "PLAN,"
"INTEND," "SEEK," "ESTIMATE," "PROJECT," "WILL," "COULD," "MAY,"
AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING
STATEMENTS. THESE STATEMENTS INCLUDE, AMONG OTHERS, INFORMATION
REGARDING FUTURE OPERATIONS, FUTURE CAPITAL EXPENDITURES, AND
FUTURE NET CASH FLOW. SUCH STATEMENTS REFLECT THE COMPANY'S CURRENT
VIEWS WITH RESPECT TO FUTURE EVENTS AND FINANCIAL PERFORMANCE AND
INVOLVE RISKS AND UNCERTAINTIES, INCLUDING, WITHOUT LIMITATION,
GENERAL ECONOMIC AND BUSINESS CONDITIONS, CHANGES IN FOREIGN,
POLITICAL, SOCIAL, AND ECONOMIC CONDITIONS, REGULATORY INITIATIVES
AND COMPLIANCE WITH GOVERNMENTAL REGULATIONS, THE ABILITY TO
ACHIEVE FURTHER MARKET PENETRATION AND ADDITIONAL CUSTOMERS, AND
VARIOUS OTHER MATTERS, MANY OF WHICH ARE BEYOND THE COMPANY'S
CONTROL. SHOULD ONE OR MORE OF THESE RISKS OR UNCERTAINTIES OCCUR,
OR SHOULD UNDERLYING ASSUMPTIONS PROVE TO BE INCORRECT, ACTUAL
RESULTS MAY VARY MATERIALLY AND ADVERSELY FROM THOSE ANTICIPATED,
BELIEVED, ESTIMATED, OR OTHERWISE INDICATED. CONSEQUENTLY, ALL OF
THE FORWARD-LOOKING STATEMENTS MADE IN THIS FILING ARE QUALIFIED BY
THESE CAUTIONARY STATEMENTS AND THERE CAN BE NO ASSURANCE OF THE
ACTUAL RESULTS OR DEVELOPMENTS.
The following discussion and analysis should
be read in conjunction with "Selected Financial Data" and our
financial statements and related notes thereto included elsewhere
in this registration statement. Portions of this document that are
not statements of historical or current fact are forward-looking
statements that involve risk and uncertainties, such as statements
of our plans, objectives, expectations and intentions. The
cautionary statements made in this registration statement should be
read as applying to all related forward-looking statements wherever
they appear in this registration statement. Our actual results
could differ materially from those anticipated in the
forward-looking statements. Factors that could cause our actual
results to differ materially from those anticipated include those
discussed in "Risk Factors," "Business" and "Forward-Looking
Statements."
For a discussion of the factors that could
cause actual results to differ materially from the forward-looking
statements see the “Liquidity and Capital Resources”
section under “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” in this item
of this report and the other risks and uncertainties that are set
forth elsewhere in this report or detailed in our other Securities
and Exchange Commission reports and filings. We believe it is
important to communicate our expectations. However, our management
disclaims any obligation to update any forward-looking statements
whether as a result of new information, future events or
otherwise.
General
Overview
SIGMABROADBAND CO. is a registered Georgia
company. The Company has certain technology assets which had been
fully impaired as of December 31, 2015. The Company is to be
engaged in the business of providing voice, data, and digital video
as a triple play bundled service to rural markets in the United
States of America. We plan to offer our customers traditional cable
video programming, Internet services, telephone services and IPtv,
as well as advanced video services such as on demand, high
definition (“HD”) television and digital video recorder
(“DVR”) service. We plan to provide national and
international long distance service. Our business plan include
goals for increasing customers and revenue. To reach our goals, we
will actively invest in our network and operations in order to
improve the quality and value of the products and packages that we
offer.
SIGMABROADBAND CO. has never declared
bankruptcy, it has never been in receivership, and it has never
been involved in any legal action or proceedings. Since becoming
incorporated, has not made any significant purchase or sale of
assets, nor has it been involved in any mergers, acquisitions or
consolidations. SIGMABROADBAND CO. is not a blank check registrant
as that term is defined in Rule 419(a)(2) of Regulation C of the
Securities Act of 1933, since it has a specific business plan,
purpose and substantial assets.
Since our inception, we have been engaged in
business planning activities, including researching the industry,
identifying target markets for our services and developing our
SIGMABROADBAND CO. models and financial forecasts, performing due
diligence regarding potential geographic locations and acquisitions
most suitable for establishing our offices and identifying future
sources of capital.
Currently, SIGMABROADBAND CO. has officers
and directors who have assumed responsibility for all planning,
development and operational duties, and will continue to do so
throughout the beginning stages of the Company. Other than the
Officers/Directors and other management team, there are no
employees at the present time. We do anticipate hiring regular
employees when the need arises.
SIGMABROADBAND CO. currently has no intention
to engage in a merger or acquisition with any unidentified company.
However, we may pursue strategic acquisitions that complement our
current business model within the technology industry which may
allow us to expand our activities, capabilities, advance our
production and revenue.
SIGMABROADBAND CO.’s fiscal year end is
December 31.
Industry
Background
Approximately 100 million Americans do not
have broadband at home today and most of them are living in rural
communities across America. We intend to be a leading provider of
cost-effective and reliable technology services for home, small to
medium sized businesses in the areas we serve and to create value
to our shareholders.
We intend to deliver innovative
communications, information and entertainment. Our voice, data and
video products and services offer over intelligent wireless,
wireline, cable, fiber, broadband and global IP networks that meet
customers' growing demand for speed, mobility, security and
control. As a committed corporate citizen, we use our advanced
communications services to address important issues confronting our
society today, especially in rural America. We plan to follow a
strategy of being first to our regional markets with technology and
services first introduced in metropolitan areas by national service
providers.
We intend to be a full service,
facilities-based cable operator, local exchange and inter-exchange
carrier serving both residential and commercial customers by
providing voice, data and digital video services. We intend to
employ the newest technology available in the marketplace today,
which provides quality of service (QoS), reliability, security,
redundancy and continuity of service always. In the future, we will
be recognized as a leader in the data network, IP telephony and
cloud-based services. Our potential customers are located in some
of the country’s largest cities to families living in rural
communities. We intend to establish a dominant national presence in
the triple-play broadband, cable and telecom industry in
America.
Plan of
Operation
We are a development stage company,
incorporated on October 19, 2012 and have not started operations or
generated or realized any revenues from our business operations.
However, we have substantial technology assets ready to deploy in
the rural markets where we plan to provide our
services.
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 any
revenues. Accordingly, we must raise cash from sources other than
operations. Our only other source for cash at this time is
investments by others in our Company.
Our Officers and Directors are 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,
they will be responsible for the administration of the controls.
Should they not have sufficient experience, they may be incapable
of creating and implementing the controls which may cause us to be
subject to sanctions and fines by the Securities and Exchange
Commission which ultimately could cause you to lose your
investment.
Since incorporation, the Company has financed
its operations originally through private capital and then, loans
from stockholders and executives of the Company. As of March 31,
2016 we had $270
cash on hand. We had total expenses of $85,230 which were related to
general and administrative costs (See “Financial
Statements”).
To date, the Company has not fully
implemented its planned principal operations or strategic business
plan. SIGMABROADBAND CO. is attempting to secure sufficient
monetary assets to increase operations. SIGMABROADBAND CO. cannot
assure any investor that it will be able to enter into sufficient
business operations adequate enough to insure continued operations.
Our intended plan of operations is to offer
voice, data, and video services and implement the necessary sales
and marketing support to begin generating revenue. If
SIGMABROADBAND CO. does not produce sufficient cash flow to support
its operations over the next 12 months, the Company will need to
raise additional capital by issuing capital stock in exchange for
cash in order to continue as a going concern. There are no formal
or informal agreements to attain such financing. SIGMABROADBAND CO.
cannot assure any investor that, if needed, sufficient financing
can be obtained or, if obtained, that it will be on reasonable
terms. Without realization of additional capital, it would be
unlikely for operations to continue and any investment made by an
investor would be lost in its entirety.
SIGMABROADBAND CO. currently does own
significant plant or equipment that it can seek to sell in the near
future in order to sustain its operations if not able to raise
necessary capital for its business.
Our management anticipates hiring employees
over the next twelve (12) months as needed. Currently, the
Company believes the services provided by its officers and
directors appear sufficient at this time.
The Company has not paid for expenses on
behalf of any directors. Additionally SIGMABROADBAND CO.
believes that this policy shall not materially change within the
next twelve months.
The Company has no plans to seek a business
combination with another entity in the foreseeable
future.
Impact of
Inflation
We believe that the rate of inflation has had
negligible effect on us. We believe we can absorb most, if not all,
increased non-controlled operating costs by operating our Company
in the most efficient manner possible.
Results of
Operations
We have generated no significant revenues
since inception; we have incurred operational expenses for the
three months ended March 31, 2016 and 2015 in the amounts of
$85,230 and
$285,120
respectively. These expenses were attributed to continuing startup
costs including general and administrative expenses. The decrease
in $250,000
depreciation and the increase of $50,000 in expenses offset the
operational expenses.
General Trends and
Outlook
We believe that our immediate outlook is
extremely favorable, as we believe the competition is very limited
in our market niche for broadband voice, data and video in the
rural markets and only a limited number of companies competing with
us in the marketplace. However, there is no assurance that such
national competitor will not arrive in the future. We do not
anticipate any major changes in the triple-play telecommunications
industry. We believe that 2016 and beyond will be a significant
growth year(s) for us. As we gain strength and stability in the
regional rural markets we intend to expand our influence in markets
throughout the U.S.
Liquidity and
Capital Resources
The financial statements have been prepared
assuming the company will continue as a going concern as per its
business plan. For the three months ended March 31, 2016, the
company has a net loss $85,230. The company has
financed its activities from private funding and proceeds from the
issuance of its common stock. As of March 2016 and December 2015
the Company had $270 and $275 in cash on hand
respectively.
The company intends to finance its future
business and development activities and its working capital needs
largely from the sale of equity securities until such time that
funds generated from operations are sufficient to fund working
capital requirements.
Off Balance Sheet
Arrangements
There are no Off
Balance Sheet Arrangements.
ITEM
3: QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK
Market risk represents the risk of changes in
value of a financial instrument, derivative or non-derivative,
caused by fluctuations in interest rates, foreign exchange rates
and equity prices. Changes in these factors could cause
fluctuations in results of our operations and cash flows. In the
ordinary course of business, we are not exposed to interest rate
and foreign currency exchange rate risks.
ITEM
4. CONTROLS AND PROCEDURES
Based upon the required evaluation of our
disclosure controls and procedures, our President and Chief
Executive Officer and Chief Financial Officer concluded that as of
March 31, 2016 our disclosure controls and procedures were
inadequate and not effective to ensure that information was
gathered, analyzed and disclosed on a timely basis.
There has been no change in our internal
control over financial reporting (as defined in
Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that
occurred during our fiscal quarter ended March 31, 2016, that has
materially affected, or is reasonably likely to materially affect,
our internal control over financial reporting.
Evaluation of
disclosure controls and procedures
Under the supervision and with the
participation of our management, including our Chief Executive
Officer and our Chief Financial Officer, we carried out an
evaluation of the effectiveness of the design and operation of our
disclosure controls and procedures as defined in Rules 13a-15 (e)
and 15d-15(e) under the Exchange Act. Based on that evaluation, our
Chief Executive Officer and our Chief Financial Officer have
concluded that, at March 31, 2016, such disclosure controls and
procedures were not effective, based on our delinquent filings.
Disclosure controls and procedures are controls and other
procedures that are designed to ensure that information required to
be disclosed in our reports filed or submitted 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 in our
reports filed or submitted under the Exchange Act is accumulated
and communicated to management, including our Chief Executive
Officer and Chief Financial Officer, or persons performing similar
functions, as appropriate, to allow timely decisions regarding
required disclosure.
Management's Report
on Internal Control over Financial Reporting
The Company's management is responsible for
establishing and maintaining adequate internal control over
financial reporting, as defined in Rule 13a-15(f) promulgated under
the Exchange Act of 1934 as a process designed by or under the
supervision of the company’s principal executive and
principal financial officers and effected by the company’s
board of directors, management and other personnel, to provide
reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
reporting purposes in accordance with generally accepted accounting
principles in the United States of America and included those
policy and procedures that:
|
·
|
Pertain to the
maintenance of records that in reasonable detail accurately and
fairly reflect the transaction and dispositions of the assets of
the company.
|
|
·
|
Provide reasonable
assurance that transactions are recorded as necessary to permit
preparation of finical statements in accordance with accounting
principles generally accepted in the United States of America and
that receipts and expenditures of the company are being made only
in accordance with authorizations of management and directors of
the company; and
|
|
·
|
Provide reasonable
assurance regarding prevention for timely detection of unauthorized
acquisition, use or disposition of the company’s assets that
could have a material effect on the financial
statements
|
A control system, no matter how well
conceived or operated, can provide only reasonable, not absolute
assurance that the objectives of the control system are met under
all potential conditions, regardless of how remote, and may not
prevent or detect all errors and all fraud. Because of the inherent
limitations in all control systems, no evaluation of controls can
provide absolute assurance that all control issues and instances of
fraud, if any, within the Company have been prevented or detected.
Our internal control over financial reporting is designed to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles in the United States of America.
As of March 31, 2016 management assessed the
effectiveness of our internal controls over financial reporting
based on the criteria for effective internal control over financial
reporting established in Internal Control-Integrated Framework
issued by the Committee of Sponsoring Organization of the Treadway
Commission (“COSO”) and SEC guidance on conducting such
assessments. Based on that evaluation, they concluded that, during
the period covered by this report, such internal controls and
procedures were not effective to detect the appropriate application
of US GAAP rules.
Our disclosure controls and procedures are
designed to provide reasonable, not absolute, assurance that the
objectives of our disclosure control system are met. Because of
inherent limitations in all control systems, no evaluation of
controls can provide absolute assurance that all control issues, if
any, within a company have been detected. Based on their evaluation
as of the end of the period covered by this report, management
concluded that our disclosure controls and procedures were
sufficiently effective to provide reasonable assurance that the
objectives of our disclosure control system were met.
Changes in Internal
Control over Financial Reporting
No change in the Company's internal control
over financial reporting occurred during the quarter ended March
31, 2016, that materially affected, or is reasonably likely to
materially affect, the Company's internal control over financial
reporting.
PART II—OTHER
INFORMATION
ITEM
1. LEGAL PROCEEDINGS
The Company is not involved in any legal
proceedings and is not aware of any pending or threatened
claims.
The Company expects and may be subject to
legal proceedings and claims from time to time in the ordinary
course of its business, including, but not limited to, claims of
alleged infringement of the trademarks and other intellectual
property rights of third parties by the Company and its licensees.
Such claims, even if not meritorious, could result in the
expenditure of significant financial and managerial
resources.
ITEM 2.
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS
There have been no sales of unregistered
securities during the quarter ended March 31, 2016.
During the three months period ended March
31, 2016, there was no modification of any instruments defining the
rights of holders of the Company's common stock and no limitation
or qualification of the rights evidenced by the Company's common
stock as a result of the issuance of any other class of securities
or the modification thereof.
During the period covered by this filing, the
Company did not sell any securities that were not registered under
the Securities Act.
ITEM 3. DEFAULT
UPON SENIOR SECURITIES
There have been no defaults in any material
payments during the covered period.
ITEM 4. SUBMISSION
OF MATTERS TO A VOTE OF SECURITY SHAREHOLDERS
There have been no matters submitted to a
vote of the Company’s shareholders.
ITEM 5. OTHER
INFORMATION
None.
SIGNATURES
Pursuant to the requirements of the
Securities and Exchange Act of 1934, the registrant has caused this
report to be signed on its behalf by the undersigned, thereto duly
authorized:
SIGMABROADBAND CO.
|
|
November 2, 2017
|
|
By:
|
/s/ Jeffery A. Brown
|
|
Jeffery A,.
Brown
|
|
President, Chief Executive Officer and
Director
|
|
|
EXHIBITS
INDEX OF
EXHIBITS
ITEM 6.
Exhibits
Exhibit No.
|
|
Description
|
|
|
|
|
Certification by
Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
|
|
|
Certification by
Chief Executive Officer pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
|
|
|
Certification by
Chief Financial Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
|
|
|
Certification by
Chief Financial Officer pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
|
17