Mastermind (MMND) 10-Q 4 Jan 18 2015 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	3 Months Ended
	Mar. 31, 2015	Jun. 30, 2014
Document and Entity Information:
Entity Registrant Name	COCONNECT, INC.
Document Type	10-Q
Document Period End Date	Mar. 31, 2015
Trading Symbol	ccon
Amendment Flag	false
Entity Central Index Key	1,088,638
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding	3,239,428
Entity Public Float		$ 20,000
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q1

Condensed Balance Sheets

Condensed Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2015		Dec. 31, 2014
Current assets
Cash	$ 15		$ 6
Prepaid expenses and other current assets	3		19
Total current assets	18		25
Security deposit	5		5
Total assets	23		30
Current liabilities
Accounts payable	20		30
Accrued expenses	4		18
Total current liabilities	24		48
Total liabilities	24		48
Stockholders' equity
Preferred stock		[1]		[2]
Common stock	3	[3]	3	[4]
Additional paid-in capital	12,033		11,973
Accumulated deficit	(12,037)		(11,994)
Total stockholders' equity	(1)		(18)
Total liabilities and stockholders' equity	$ 23		$ 30
[1]	$.001 par value, 1,000,000 shares authorized; no shares issued and outstanding as of 3/31/2015.
[2]	$.001 par value, 1,000,000 shares authorized; no shares issued and outstanding as of 12/31/2014.
[3]	$.001 par value, 4,999,000,0000 shares authorized; 3,239,428 shares issued and outstanding as of 3/31/2015.
[4]	$.001 par value, 4,999,000,000 shares authorized; 3,179,428 shares issued and outstanding as of 12/31/2014.

Condensed Statements of Operati

Condensed Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Expenses
General and administrative	$ 43	$ 12
Total expenses	43	12
Net loss	$ (43)	$ (12)
Net loss per common share, basic	$ (0.01)	$ 0
Net loss per common share, diluted	$ (0.01)	$ 0
Shares used in computing net loss per common share, basic	3,194	2,750
Shares used in computing net loss per common share, diluted	3,194	2,750

Condensed Statements of Cash Fl

Condensed Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Cash flows from operating activities
Net loss	$ (43)	$ (12)
Changes in assets and liabilities:
(Increase) decrease in prepaid expenses and other current assets	16
Increase (decrease) in accounts payable	(10)	2
Increase (decrease) in accrued expenses	(14)
Net cash flows provided by (used in) operating activities	(51)	(10)
Cash flows from financing activities
Proceeds from issuance of common stock	60
Proceeds from related party and shareholder cash advances		10
Net cash flows provided by (used in) financing activities	60	$ 10
Net change in cash	9
Cash at beginning of period	6
Cash at end of period	$ 15

Description of Business

Description of Business	3 Months Ended
	Mar. 31, 2015
Notes
Description of Business	1. Description of Business CoConnect, Inc. is a Nevada corporation. We currently have no operations and have been engaged in efforts to identify an operating company to acquire or merge with through an equity­based exchange transaction. Since our planned principal operations have not yet commenced, our activities are subject to significant risks and uncertainties, including the need to obtain additional financing, as described below. Any business combination or transaction will likely result in a significant issuance of shares and substantial dilution to our stockholders. It is anticipated that the consummation by us of a merger transaction would result in a change in control which would be accounted for as a reverse merger. Accordingly, the operating company would be referred to as the legal acquiree and accounting acquirer, and we would be referred to as the legal acquirer and the accounting acquiree. As a result, at and subsequent to closing of any such transaction, the financial statements of the operating company would become our financial statements for all periods presented.

Interim Financial Statements an

Interim Financial Statements and Basis of Presentation	3 Months Ended
	Mar. 31, 2015
Notes
Interim Financial Statements and Basis of Presentation	2. Interim Financial Statements and Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, these unaudited condensed financial statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and judgments, which are evaluated on an ongoing basis, and that affect the amounts reported in our unaudited condensed financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments (consisting only of normal recurring adjustments), which we consider necessary, for a fair presentation of those financial statements. The results of operations and cash flows for the three months ended March 31, 2015 may not necessarily be indicative of results that may be expected for any succeeding quarter or for the entire fiscal year. The information contained in this quarterly report on Form 10-Q should be read in conjunction with our audited financial statements included in our annual report on Form 10-K as of and for the year ended December 31, 2014 as filed with the Securities and Exchange Commission (the “SEC”). Certain amounts in the fiscal 2014 financial statements have been reclassified to conform to the fiscal 2015 presentation. Our significant accounting policies are described in Note 2 to the financial statements included in Item 8 of our annual report on Form 10-K as of December 31, 2014. There were no material changes to our significant accounting policies during the interim period ended March 31, 2015.

Going Concern

Going Concern	3 Months Ended
	Mar. 31, 2015
Notes
Going Concern	3. Going Concern Our unaudited condensed financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the three months ended March 31, 2015, we incurred a net loss of approximately $43,000, had negative cash flows from operations of $51,000 and had a working capital deficit of $6,000. We have financed our recent working capital requirements primarily through the issuance of equity securities. As a result, management believes there is substantial doubt about our ability to continue as a going concern. Management is seeking to identify an operating company and engage in a merger or business combination of some kind, or acquire assets or shares of an entity actively engaged in a business that generates sustained revenues. We are considering several potential acquisitions and is investigating various candidates to determine whether they would have the potential to add value to us for the benefit of our stockholders. We do not intend to restrict our consideration to any particular business or industry segment, and we may consider, among other businesses, finance, brokerage, insurance, transportation, communications, services, natural resources, manufacturing or technology. Because we have limited resources, the scope and number of suitable candidates to merge with is relatively limited. Because we may participate in a business opportunity with a newly formed firm, a firm that is in the development stage, or a firm that is entering a new phase of growth, we may incur further risk due to the inability of the target’s management to have proven its abilities or effectiveness, or the lack of an established market for the target’s products or services, or the inability to reach profitability in the next few years. Any business combination or transaction will likely result in a significant issuance of shares and substantial dilution to our present stockholders. As it is expected that the closing of such a transaction will result in a change in control, such transaction is expected to be accounted for as a reverse merger, with the operating company being considered the legal acquiree and accounting acquirer, and we would be considered the legal acquirer and the accounting acquiree. As a result, at and subsequent to closing of any such transaction, the financial statements of the operating company would become our financial statements for all periods presented.

New Accounting Pronouncement

New Accounting Pronouncement	3 Months Ended
	Mar. 31, 2015
Notes
New Accounting Pronouncement	4. New Accounting Pronouncement We have evaluated all issued but not yet effective accounting pronouncements and determined that they are either immaterial or not relevant to us.

Related Party Transactions

Related Party Transactions	3 Months Ended
	Mar. 31, 2015
Notes
Related Party Transactions	5. Related Party Transactions Effective May 1, 2014, Bennett J. Yankowitz was appointed as our President, Secretary, Treasurer and sole director. During the three months ended March 31, 2015, we entered into an office sublease arrangement with Bamboo Holdings, LLC (“Bamboo”). Bamboo is owned by Mr. Yankowitz. The sublease arrangement requires Bamboo to pay us approximately $1,000 per month, the approximate fair market value for such space. Approximately $2,000 of sublease income was offset against our total rent expense of approximately $17,000 during the three months ended March 31, 2015 and is included in general and administrative expenses. On February 3, 2015, we sold 20,000 shares of our common stock to PacificWave Partners Limited, a Gibraltar company, which is owned by our Assistant Secretary, for an aggregate sales price of $20,000. On March 16, 2015, PacificWave Partners Limited loaned us $5,000 for working capital purposes pursuant to a short-term unsecured promissory note due March 31, 2015 with interest at 5%. The promissory note was repaid on March 23, 2015.

Basic and Diluted Loss Per Shar

Basic and Diluted Loss Per Share	3 Months Ended
	Mar. 31, 2015
Notes
Basic and Diluted Loss Per Share	6. Basic and Diluted Loss Per Share Basic loss per common share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. Diluted loss per common share is based upon the weighted-average common shares outstanding during the period plus additional weighted-average common equivalent shares outstanding during the period. Common equivalent shares result from the assumed exercise of outstanding stock options and warrants, the proceeds of which are then assumed to have been used to repurchase outstanding common stock using the treasury stock method. In addition, the numerator is adjusted for any changes in income that would result from the assumed conversion of potential shares. There were no potentially dilutive shares which would have the effect of being antidilutive.

Stockholders' Deficit

Stockholders' Deficit	3 Months Ended
	Mar. 31, 2015
Notes
Stockholders' Deficit	7. Stockholders’ Deficit On February 3, 2015, we sold 20,000 shares of our common stock to PacificWave Partners Limited, for an aggregate sales price of $20,000. On March 25, 2015, we sold an additional 40,000 shares of our common stock to two significant stockholders for an aggregate amount of $40,000.

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2015
Notes
Income Taxes	8. Income Taxes The provision for income taxes includes federal, state, local and foreign taxes. Income taxes are accounted for under the liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences of temporary differences between the financial statement carrying amounts and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year in which the temporary differences are expected to be recovered or settled. We evaluate the realizability of our deferred tax assets and establishes a valuation allowance when it is more likely than not that all or a portion of deferred tax assets will not be realized. A valuation allowance has been recorded to offset all deferred tax assets due to uncertainty of realizing the tax benefits of the underlying operating loss and tax credit carry forwards over their carry forward periods. We have no significant deferred tax liabilities as of March 31, 2015 and December 31, 2014. We account for uncertain tax positions using a “more-likely-than-not” threshold for recognizing and resolving uncertain tax positions. The evaluation of uncertain tax positions is based on factors including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, new audit activity and changes in facts or circumstances related to a tax position. We evaluate this tax position on a quarterly basis. We also accrue for potential interest and penalties, if applicable, related to unrecognized tax benefits in income tax expense. As of March 31, 2015 and December 31, 2014, we had no material unrecognized tax benefits and no adjustments to liabilities or operations were required.

Legal Matters

Legal Matters	3 Months Ended
	Mar. 31, 2015
Notes
Legal Matters	9. Legal Proceedings Other than as stated herein, we are not a party to any other legal proceedings, other than ordinary routine litigation incidental to our business, which we believe will not have a material affect on our financial position or results of operations. In May 2016, Investment Services V Devkom International, LLC (“Devkom”), one of our former controlling shareholders, filed a complaint in the Eighth Judicial District Court for Clark County, Nevada against us, PacificWave Partners Limited (“PWP”), PWP’s principal, Henrik Rouf, Bennett Yankowitz, our President and sole director, and Mr. Yankowitz’s former law firm. The complaint contained several claims for relief arising out of an alleged breach of a contract between Devkom and PWP for the purchase of a controlling interest in our stock in May 2014. The breach alleged was the failure of PWP to pay approximately $76,000 to Devkom under the terms of the contract. Other claims included breach of an implied escrow agreement, conversion, breach of fiduciary duty, and fraud. Devkom sought to recover general, exemplary and punitive damages. In August 2016, the Court dismissed the complaint without prejudice. In June 2017, Devkom filed a similar complaint against the same defendants in the Superior Court of California for the County of San Diego. In June 2017, we and PWP filed a motion to quash the service of the summons and complaint in the action on the grounds that the Court has no jurisdiction over the Company or PWP and that service was defective. At the same time, Mr. Yankowitz and his former law firm filed demurrers to all of the causes of action specified in the complaint. A hearing on the motion to quash and the demurrers is scheduled for January 5, 2018.

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2015
Notes
Subsequent Events	10. Subsequent Events We evaluated all events or transactions that occurred after the balance sheet date through the date when we issued these unaudited condensed financial statements. Other than the legal proceedings discussed in Note 9, we did not have any material recognizable subsequent events during this period.

Interim Financial Statements 15

Interim Financial Statements and Basis of Presentation: Use of Estimates (Policies)	3 Months Ended
	Mar. 31, 2015
Policies
Use of Estimates	The accompanying unaudited condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, these unaudited condensed financial statements do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and judgments, which are evaluated on an ongoing basis, and that affect the amounts reported in our unaudited condensed financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the amounts of expenses that are not readily apparent from other sources. Actual results could differ from those estimates and judgments. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments (consisting only of normal recurring adjustments), which we consider necessary, for a fair presentation of those financial statements. The results of operations and cash flows for the three months ended March 31, 2015 may not necessarily be indicative of results that may be expected for any succeeding quarter or for the entire fiscal year. The information contained in this quarterly report on Form 10-Q should be read in conjunction with our audited financial statements included in our annual report on Form 10-K as of and for the year ended December 31, 2014 as filed with the Securities and Exchange Commission (the “SEC”).

Interim Financial Statements 16

Interim Financial Statements and Basis of Presentation: Reclassification of Certain Amounts (Policies)	3 Months Ended
	Mar. 31, 2015
Policies
Reclassification of Certain Amounts	Certain amounts in the fiscal 2014 financial statements have been reclassified to conform to the fiscal 2015 presentation.

Interim Financial Statements 17

Interim Financial Statements and Basis of Presentation: Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2015
Policies
Significant Accounting Policies	Our significant accounting policies are described in Note 2 to the financial statements included in Item 8 of our annual report on Form 10-K as of December 31, 2014. There were no material changes to our significant accounting policies during the interim period ended March 31, 2015.