UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
x | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended SEPTEMBER 30, 2008
o | TRANSITION REPORT UNDER SECTION13 OR 15(d) OF THE EXCHANGE ACT |
For the transition period ………… to …………
Commission File No. 333-33890
BANX AND GREEN GROUP, INC.
(Exact name of small business issuer as specified in its charter)
Nevada | 88-0227424 | |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) |
6445 S. CHICKASAW TRAIL # 318, ORLANDO, FL 32829
(Address of Principal Executive Offices)
(407) 286-4103
(Issuers Telephone Number, Including Area Code)
BEERE FINANCIAL EQUITY CORP.
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 past 90 days. x Yes ¨ 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 definition of “accelerated filer” and smaller reporting company” in Rule 12b-2 of the Exchange Act (Check One):
Large accelerated filer ¨ | Accelerated filer ¨ |
Non-accredited 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 x NO
There were 8,776,311 shares of the Registrant’s $.001 par value common stock outstanding at November 19, 2008.
Traditional Small Business Disclosure Format (Check one): Yes¨ No x
Banx and Green Group, Inc.
TABLE OF CONTENTS
Part 1—Financial Information | 1 | ||
Item 1 | Consolidated Financial Statements | 1 | |
Consolidated Balance Sheets | 1 | ||
Consolidated Statements of Operations | 2 | ||
Consolidated Statements of Cash Flows | 3 | ||
Consolidated Statement of Changes in Stockholders’ Equity | 5 | ||
Notes to Consolidated Financial Statements | 6 | ||
Item 2 | Management’s Discussion and Analysis | 7 | |
Item 3 | Quantitative and Qualitative Disclosures About Market Risk | 9 | |
Item 4T | Controls and Procedures | 9 | |
Part II—Other Information | 10 | ||
Item 1 | Legal Proceedings | 10 | |
Item 1A | Risk Factors | 10 | |
Item 2 | Unregistered Sales of Equity Securities and Use of Proceeds | 10 | |
Item 3 | Defaults Upon Senior Securities | 10 | |
Item 4 | Submission of Matters to a Vote of Security Holders | 10 | |
Item 5 | Other Matters | 10 | |
Item 6 | Exhibits and Reports on Form 8K | 10 | |
Signatures | 11 |
PART 1— FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
BANX AND GREEN GROUP, INC.
CONSOLIDATED BALANCE SHEET
September 30, 2008 (unaudited) | December 31, 2007 (audited) | ||||||
ASSETS | |||||||
Cash | $ | 7,849 | $ | 1,941 | |||
Accounts receivable | 16,354 | 13,981 | |||||
Inventory | 32,650 | 91,300 | |||||
CURRENT ASSETS | 56,853 | 107,222 | |||||
Subsidiary Investment | 500,000 | - | |||||
Music Catalog Investments | 30,000 | - | |||||
TOTAL OTHER ASSETS | �� | 530,000 | - | ||||
Equipment | 10,134 | - | |||||
Accumulated Depreciation | (3,547 | ) | - | ||||
TOTAL FIXED ASSETS | 6,587 | - | |||||
TOTAL ASSETS | $ | 593,440 | $ | 107,222 | |||
LIABILITIES AND STOCKHOLDERS’ DEFICIT) | |||||||
CURRENT LIABILITIES | |||||||
Accounts payable | $ | 127,657 | $ | 111,967 | |||
Accounts payable -related parties | 175,809 | 174,972 | |||||
Accrued expenses | 101,268 | 70,810 | |||||
Wages payable | 283,425 | 283,425 | |||||
Loans payable – related party | 179,981 | 192,255 | |||||
Royalties payable | 40,170 | - | |||||
Current loan payable | 225,000 | 225,000 | |||||
Total Current Liabilities | 1,133,310 | 1,099,854 | |||||
STOCKHOLDERS’ EQUITY (DEFICIT) | |||||||
Preferred stock; 10,000,000 shares authorized; $.001 Par Value; 296,300 shares issued and outstanding at September30, 2008 | 296 | 296 | |||||
Capital stock, $.001 Par Value; 50,000,000 shares authorized; 8,776,311 shares issued and outstanding at September30, 2008 | 8,776 | 8,776 | |||||
Additional paid-in capital | 3,000,724 | 2,750,724 | |||||
Deficit accumulated during the development stage | (3,549,666 | ) | (3,521,266 | ) | |||
Total Stockholders’ Equity | (539,870 | ) | (761,470 | ) | |||
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ | 593,440 | $ | 338,384 |
See accompanying notes to condensed financial statements.
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BANX AND GREEN GROUP, INC
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
For the Three Months Ended September 30, 2008 | For the Three Months Ended September 30, 2007 | For the Nine Months Ended September 30, 2008 | For the Nine Months Ended September 30, 2007 | ||||||||||
NET SALES | $ | 34,722 | $ | 20,197 | $ | 121,560 | $ | 86,772 | |||||
COST OF SALES | 6,134 | 14,472 | 61,206 | 59,523 | |||||||||
Gross Margin | 28,588 | 5,725 | 60,354 | 27,249 | |||||||||
EXPENSES | |||||||||||||
Wages | 18,342 | - | 18,342 | 68,000 | |||||||||
General and Administrative Expenses | 16,458 | 15,455 | 48,215 | 52,405 | |||||||||
TOTAL OPERATING EXPENSES | 34,800 | 15,455 | 66,557 | 120,405 | |||||||||
Net Income (Loss) from Operations | (6,212 | ) | (8,772 | ) | (6,203 | ) | (93,156 | ) | |||||
OTHER INCOME (EXPENSE) | |||||||||||||
Gain(loss) on Sale of Marketable Securities | - | - | - | (168 | ) | ||||||||
Interest Expense | (11,267 | ) | (10,152 | ) | (35,285 | ) | (30,456 | ) | |||||
TOTAL OTHER INCOME (LOSS) | (11,267 | ) | (10,152 | ) | (35,285 | ) | (30,624 | ) | |||||
NET LOSS BEFORE INCOME TAXES | (17,479 | ) | (18,924 | ) | (41,488 | ) | (123,780 | ) | |||||
PROVISION FOR INCOME TAXES | - | - | - | - | |||||||||
NET LOSS | $ | (17,479 | ) | $ | (18,924 | ) | $ | (41,488 | ) | $ | (123,780 | ) | |
BASIC and DILUTED LOSS PER SHARE | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.01 | ) | |
WEIGHTED AVERAGE SHARES OUTSTANDING | 8,776,311 | 8,776,311 | 8,776,311 | 8,776,311 |
See accompanying notes to condensed financial statements.
2
BANX AND GREEN GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
For the Nine Months Ended September 30, 2008 | For the Nine Months Ended September 30, 2007 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net Loss | $ | (41,488 | ) | $ | (123,780 | ) | |
Adjustments to reconcile net loss from net cash used in operating activities: | |||||||
Depreciation and amortization | 1,520 | - | |||||
(Gain) Loss on Sale of Securities | - | 168 | |||||
Changes in Assets and Liabilities: | |||||||
(Increase) in Inventory | (32,650 | ) | (97,035 | ) | |||
(Increase) in Accounts Receivable | 8,002 | (14,987 | ) | ||||
Increase (Decrease) in Accounts and Loans Payable | 55,135 | 125,644 | |||||
Increase in Accrued Interest | 40,285 | 30,456 | |||||
Increase (Decrease) in Wages Payable | - | 68,000 | |||||
Increase (Decrease) in Advances from Shareholder | - | - | |||||
Net Cash Used By Operating Activities | 30,804 | (11,534 | ) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Purchase of Fixed Assets | - | - | |||||
Proceeds from Sale of Marketable Securities | - | 193 | |||||
Net Cash Provided By Investing Activities | - | 193 | |||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Proceeds from Issuance of Common Stock, net | - | - | |||||
Payments on Notes Payable | (40,790 | ) | - | ||||
Proceeds from Notes Payable | 13,500 | - | |||||
Contributed Capital | - | - | |||||
Net Cash Provided By Financing Activities | (27,290 | ) | - | ||||
NET INCREASE (DECREASE) IN CASH | 3,514 | (11,341 | ) | ||||
CASH – BEGINNING OF PERIOD | 4,335 | 13,761 | |||||
CASH – END OF PERIOD | $ | 7,849 | $ | 2,420 |
See accompanying notes to condensed financial statements.
3
BANX AND GREEN GROUP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
For the Nine Months Ended September30, 2007 | For the Nine Months Ended September 30, 2006 | ||||||
Supplemental Cash Flow Information: | |||||||
Stock Issued In Exchange for Goods and Services and Marketable Securities | $ | - | $ | - | |||
Stock Issued In Exchange for License Fee | $ | - | $ | - | |||
Cash Paid for Interest | $ | - | $ | - | |||
Cash Paid for Income Taxes | $ | - | $ | - |
See accompanying notes to condensed financial statements.
4
BANX AND GREEN GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY
For the periods ended March 31, 2008 and the years ending December 31, 2006 and 2007 (UNAUDITED)
Deficit | ||||||||||||||||||||||||||||
Accumulated | Accumulated | |||||||||||||||||||||||||||
Additional | During the | Other | Total | Comprehensive | ||||||||||||||||||||||||
Preferred Stock | Capital Stock | Paid-in | Development | Comprehensive | Stockholders’ | Income | ||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Stage | Income (Loss) | Equity | (Loss) | ||||||||||||||||||||
Sale of Assets return shares | - | $ | - | (900,000 | ) | $ | (900 | ) | $ | 4,449,215 | ) | $ | - | $ | - | $ | (4,450,115 | ) | ||||||||||
Net loss for the year ended December 31, 2006 | - | - | - | - | - | (344,757 | ) | - | (344,757 | ) | 344,757 | ) | ||||||||||||||||
Other comprehensive income (loss) Unrealized loss on securities | - | - | - | - | - | - | (1,798 | ) | (1,798 | ) | (1,798 | ) | ||||||||||||||||
Comprehensive income (loss) | - | - | - | - | - | - | - | - | (346,555 | ) | ||||||||||||||||||
Balance December 31, 2006 | 296,300 | $ | 296 | 8,776,311 | $ | 8,776 | $ | 2,500,726 | $ | (3,405,487 | ) | $ | (1,901 | ) | $ | (897,590 | ) | |||||||||||
Net loss for the year ended December 31, 2007 | - | - | - | - | - | (147,366 | ) | - | (147,366 | ) | (147,366 | ) | ||||||||||||||||
Other comprehensive income (loss) Unrealized gain on securities | - | - | - | - | - | - | 1,901 | 1,901 | 1,901 | |||||||||||||||||||
Comprehensive income (loss) | - | - | - | - | - | - | - | - | (145,465 | ) | ||||||||||||||||||
Balance - December 31, 2007 | 296,300 | $ | 296 | 8,776,311 | $ | 8,776 | $ | 2,500,726 | $ | (3,552,853 | ) | $ | 0 | $ | (1,043,055 | ) | ||||||||||||
Purchase subsidiary | - | - | - | - | 500,000 | - | - | 500,000 | ||||||||||||||||||||
Adjustment for disposal subsidiary | - | - | - | - | (2 | ) | 44,674 | - | 44,672 | |||||||||||||||||||
Net Loss for the Nine Months Ended September30, 2008 | - | - | - | - | - | (41,488 | ) | - | (41,488 | ) | ||||||||||||||||||
Balance – September30, 2008 | 296,300 | $ | 296 | 8,776,311 | $ | 8,776 | $ | 3,000,724 | $ | (3,549,668 | ) | $ | - | $ | (539,870 | ) |
See accompanying notes to condensed financial statements.
5
NOTE 1 | COMPANY BACKGROUND |
The predecessor company Power Save, Inc. was incorporated on May 8, 1987 in Nevada under the name Florida Pacific Corporation. In December 1988, Power Save Products was merged into Florida Pacific and the name was changed to Power Save International, Inc. The company later changed its name and sold the name Power Save International, Inc. the then company President. The company contributed the assets and liabilities into a new corporation named Power Save, Ltd. formed in Nevada on July 23, 1999 and the name was later changed to Power Save International, Inc. In November 2005, Power Save International, Inc. merged with its subsidiary Beere Financial Equity Corp. with Beere Financial Equity Corp. as the surviving company after the merger. Beere Financial Equity Corp was formed in 2005 to be the financial services subsidiary.
On February 5, 2008 the Company purchased LGN Entertainment Distribution, Inc. This subsidiary owns a group of music catalogs and has several music artists under distribution contracts. It distributes its products through CD and digital formats with three recognized service providers to facilitate its broad access to the music markets.
On August 29, 2008, the Company purchased Eight76 Records, Inc., a Florida corporation, to enhance the products and library of distributable products.
NOTE 2 | BASIS OF PRESENTATION |
The interim financial statements at September 30, 2008 and three month periods ended September 30, 2008 and 2007 are unaudited, but include all adjustments which the Company considers necessary for a fair presentation. The accompanying unaudited financial statements are for the interim periods and do not include all disclosures normally provided in annual financial statements, and should be read in conjunction with the Company's Form 10-KSB for the year ended December 31, 2007. The accompanying unaudited interim financial statements for the three month periods ended September 30, 2008 and 2007 are not necessarily indicative of the results which can be expected for the entire year.
The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of 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.
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NOTE 3 | DISPOSITION OF ASSETS |
The Company discontinued its Canadian operations as of December 31, 2007 and has disposed of the assets for the assumption of the subsidiary debt of $159,075.
NOTE 4 | GOING CONCERN |
The Company's condensed consolidated financial statements have been presented on the basis that it is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has a net loss from operations of $6,203, and negative working capital of $1,076,457, and a stockholders’ deficit of $(761,470) for the period ended September30, 2008. These matters raise substantial doubt about its ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
Management believes that actions presently taken to expand its future operations and raise capital provide the opportunity for the Company to continue as a going concern.
Item 2. Management's Discussion and Analysis
The following discussion and analysis should be read in conjunction with our financial statements and the accompanying notes. The following discussion and analysis contains forward-looking statements, which involve risks and uncertainties in the forward-looking statements. These forward-looking statements may be impacted, either positively or negatively, by various factors.
Our actual results may differ significantly from the results, expectations and plans discussed. This Report contains "forward looking statements" relating to our company's current expectations and beliefs. These include statements concerning operations, performance, financial condition, anticipated acquisitions and anticipated growth.
Without limiting the generality of the foregoing, words such as "may", "will", "would", "expect", "believe", "anticipate", "intend", "could", "estimate", or "continue", or the negative or other variation thereof or comparable terminology are intended to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainties which are beyond our company's control. Should one or more of these risks or uncertainties materialize or should our company's underlying assumptions prove incorrect, actual outcomes and results could differ materially from those indicated in the forward-looking statements.
General
Management is formulating the basis for acquisitions to complete its previously announced business plan. Additional opportunities have arisen that may allow the Company to expand the scope of business operations and more readily allow it to acquire the capital it requires.
7
Results of Operations
The Company disposed of its Canadian operations on 1/2/2008 and purchased LGN Entertainment Distributors, Inc. on 2/5/2008. Financial statements have been adjusted for the disposal on the Consolidated Statements of Operations and Consolidated Statements of Cash Flow.
General and administrative expenses increased for the three months and decreased in the nine months ended September 30, 2008 compared to the same periods in 2007. These expenses were $34,800 and $66,557 for the three and nine months ended September 30, 2008 and $15,455 and $120,405 for the same periods in 2007, respectively. The increase for the three months ended September 30, 2008 over the same period in 2007 came from an increase in wages of $18,342 directly attributable to the subsidiaries. The decrease for the nine months ended September 30, 2008 came from decrease in wages of $49,658 and general expenses.
8
BANX AND GREEN GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the three and nine months ended September 30, 2008 we recorded net losses of $17,479 and $41,488, respectively. This compares with a net loss $18,924 and $123,780 during the corresponding prior periods in 2007.
Liquidity
During the Nine months ended September 30, 2008, the Company's working capital decreased by the accruals of all expenses offset by $33,105 in gross profit from sales. The Company does not currently have sufficient capital in its accounts, nor sufficient firm commitments for capital to assure its ability to meet its current obligations or to continue its planned operations. The Company is continuing to pursue working capital and additional revenue through the active search for the capital it needs to carry on its planned operations. There is no assurance that any planned activities will be successful.
Capital Resources
As a result of its limited liquidity, the Company has limited access to additional capital resources. The Company does not have the capital to totally fund the obligations that have matured to any of its creditors and shareholders.
Though the obtaining of the additional capital is not guaranteed, the management of the Company believes it will be able to obtain the capital required to meet its current obligations and actively pursue its planned business activities through the sale of its registered securities.
Operations
Until the Company obtains the capital required to develop any properties or businesses and obtains the revenues needed from its future operations in order to meet its obligations, the Company will be dependent upon sources other than operating revenues to meet its operating and capital needs.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not applicable
Item 4T. Controls and Procedures
Based on an evaluation by Mr. Lane, the chief financial officer of the company, conducted as of a date within 90 days of the filing date of this quarterly report, of the effectiveness of the company's disclosure controls and procedures it has been concluded that, as of the evaluation date, (i) there were no significant deficiencies or material weaknesses of the company's disclosure controls and procedures, (ii) there were no significant changes in the internal controls or in other factors that could significantly affect internal controls subsequent to the evaluation date, and (iii) no corrective actions
were required to be taken.
9
BANX AND GREEN GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 1A Risk Factors
Not applicable
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
No changes in securities have occurred since the Company's last report as of June 30, 2008.
Item 3. Defaults Upon Senior Securities.
None
Item 4. Submission of Matters to a Vote of Security Holders.
None
Item 5. Other Matters.
None.
Item 6. Exhibits and reports on Form 8-K.
(a) Exhibits.
31.1 | President and CFO certification Pursuant to 18 USC Section 1350, as adopted pursuant to Section 302 of Sarbanes-Oxley Act of 2004 |
32 | President and CFO certification pursuant to section 906 |
(b) Reports on From 8-K.
None
10
BANX AND GREEN GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Beere Financial Equity Corp.
/s/ Steve Lane |
BY: Steve Lane, President, Chief Financial |
Officer and Director |
Dated: This 24th day of November 2008 |
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