UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| ☑ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period endedJune 30, 2015
| ☐ | 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:000-30529
WINGS & THINGS, INC.
(Exact name of registrant as specified in its charter)
Nevada (State or other jurisdiction of incorporation or organization) | 87-0464667 (I.R.S. Employer Identification No.) |
220 South 200 East, #8, Salt Lake City, Utah (Address of principal executive offices) | 84111 (Zip Code) |
(801) 323-2395
(Registrant’s telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐ The registrant does not have a Web site.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐ Non-accelerated filer ☐ | Accelerated filer ☐ Smaller reporting company ☑ |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☑ No ☐
The number of shares outstanding of the registrant’s common stock as of August 5, 2015 was 18,000,000.
TABLE OF CONTENTS
| PART I – FINANCIAL INFORMATION | ||
| Item 1. | Financial Statements (Unaudited) | 2 |
| Condensed Balance Sheets (Unaudited) | 3 | |
| Condensed Statements of Operations (Unaudited) | 4 | |
| Condensed Statements of Cash Flows (Unaudited) | 5 | |
| Notes to the Unaudited Condensed Financial Statements | 6 | |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 7 |
| Item 3. | Quantitative and Qualitative Disclosures about Market Risk | 9 |
| Item 4. | Controls and Procedures | 9 |
| PART II – OTHER INFORMATION | ||
| Item 6. | Exhibits | 10 |
| Signatures | 11 | |
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
WINGS & THINGS, INC.
Financial Statements
June 30, 2015
(Unaudited)
| 2 |
Wings & Things, Inc.
Condensed Balance Sheets
| JUNE 30, 2015 | DEC 31, 2014 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash | $ | 2,545 | $ | 851 | ||||
| Total current assets | 2,545 | 851 | ||||||
| Total assets | $ | 2,545 | $ | 851 | ||||
| LIABILITIES AND STOCKHOLDERS' DEFICIT | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable – related party | $ | 15,100 | $ | 10,400 | ||||
| Notes payable – related party | 118,600 | 118,600 | ||||||
| Notes payable | 71,700 | 65,500 | ||||||
| Accrued interest – related party | 27,076 | 23,074 | ||||||
| Accrued interest | 19,766 | 17,032 | ||||||
| Total current liabilities | 252,242 | 234,606 | ||||||
| Total liabilities | 252,242 | 234,606 | ||||||
| STOCKHOLDERS' DEFICIT | ||||||||
| Common stock, $.001 par value; 20,000,000 shares authorized; 18,000,000 shares issued and outstanding | 18,000 | 18,000 | ||||||
| Additional paid-in capital | 9,000 | 9,000 | ||||||
| Accumulated deficit | (276,697 | ) | (260,755 | ) | ||||
| Total stockholders' deficit | (249,697 | ) | (233,755 | ) | ||||
| Total liabilities and stockholders' deficit | $ | 2,545 | $ | 851 | ||||
The accompanying notes are an integral part of these financial statements.
| 3 |
Wings & Things, Inc.
Condensed Statements of Operations
(Unaudited)
| FOR THE THREE MONTHS ENDED JUNE 30, 2015 | FOR THE THREE MONTHS ENDED JUNE 30, 2014 | FOR THE SIX MONTHS ENDED JUNE 30, 2015 | FOR THE SIX MONTHS ENDED JUNE 30, 2014 | |||||||||||||
| Revenues | $ | — | $ | — | $ | — | $ | — | ||||||||
| Expenses | ||||||||||||||||
| General and administrative | 3,000 | 3,550 | 9,206 | 9,900 | ||||||||||||
| Total expenses | 3,000 | 3,550 | 9,206 | 9,900 | ||||||||||||
| Net loss before other income (expense) | (3,000 | ) | (3,550 | ) | (9,206 | ) | (9,900 | ) | ||||||||
| Other income (expense) | ||||||||||||||||
| Interest expense – related party | (2,001 | ) | (2,001 | ) | (4,002 | ) | (4,002 | ) | ||||||||
| Interest expense | (1,411 | ) | (1,310 | ) | (2,734 | ) | (2,527 | ) | ||||||||
| Total other income (expense) | (3,412 | ) | (3,311 | ) | (6,736 | ) | (6,529 | ) | ||||||||
| Loss from operations before income taxes | (6,412 | ) | (6,861 | ) | (15,942 | ) | (16,429 | ) | ||||||||
| Income taxes | — | — | — | — | ||||||||||||
| Net loss | $ | (6,412 | ) | $ | (6,861 | ) | $ | (15,942 | ) | $ | (16,429 | ) | ||||
| Basic and diluted net loss per share | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | ||||
| Weighted average shares outstanding | 18,000,000 | 18,000,000 | 18,000,000 | 18,000,000 | ||||||||||||
The accompanying notes are an integral part of these financial statements.
| 4 |
Wings & Things, Inc.
Condensed Statements of Cash Flows
(Unaudited)
| FOR THE SIX MONTHS ENDED JUNE 30, 2015 | FOR THE SIX MONTHS ENDED JUNE 30, 2014 | |||||||
| Cash Flows from Operating Activities | ||||||||
| Net Loss | $ | (15,942 | ) | $ | (16,429 | ) | ||
| Adjustments to reconcile net loss to cash provided (used) by operating activities: | ||||||||
| Expenses paid by related party | 4,700 | 5,350 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Increase in accrued interest – related party | 4,002 | 4,002 | ||||||
| Increase in accrued interest | 2,734 | 2,528 | ||||||
| Net cash provided (used) by operating activities | (4,506 | ) | (4,549 | ) | ||||
| Cash Flows from Investing Activities | ||||||||
| Net cash provided (used) by investing activities | — | — | ||||||
| Cash Flows from Financing Activities | ||||||||
| Cash advances – other | 6,200 | 4,400 | ||||||
| Net cash provided (used) by financing activities | 6,200 | 4,400 | ||||||
| Increase (decrease) in cash | 1,694 | (149 | ) | |||||
| Cash and cash equivalents at beginning of period | 851 | 3,390 | ||||||
| Cash and cash equivalents at end of period | $ | 2,545 | $ | 3,241 | ||||
The accompanying notes are an integral part of these financial statements.
| 5 |
Wings & Things, Inc.
Notes to the Unaudited Condensed Financial Statements
June 30, 2015
NOTE 1 – Condensed Financial Statements
The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows as of and for the period ended June 30, 2015 and for all periods presented have been made.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s December 31, 2014 audited financial statements as reported in its Form 10-K. The results of operations for the period ended June 30, 2015 are not necessarily indicative of the operating results for the full year ended December 31, 2015.
NOTE 2 – Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has limited assets, has incurred losses since inception, has negative cash flows from operations, and has no revenue-generating activities. Its activities have been limited for the past several years and it is dependent upon financing to continue operations. These factors raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. It is management’s plan to acquire or merge with other operating companies.
NOTE 3 – Recent Pronouncement
On June 10, 2014, the Financial Accounting Standards Board ("FASB") issued update ASU 2014-10, Development Stage Entities (Topic 915). Amongst other things, the amendments in this update removed the definition of development stage entity from Topic 915, thereby removing the distinction between development stage entities and other reporting entities from US GAAP. In addition, the amendments eliminate the requirements for development stage entities to (1) present inception-to-date information on the statements of income, cash flows and shareholders’ equity, (2) label the financial statements as those of a development stage entity; (3) disclose a description of the development stage activities in which the entity is engaged and (4) disclose in the first year in which the entity is no longer a development stage entity that in prior years it had been in the development stage. The amendments are effective for annual reporting periods beginning after December 31, 2014 and interim reporting periods beginning after December 15, 2015, however entities are permitted to early adopt for any annual or interim reporting period for which the financial statements have yet to be issued. The Company has elected to early adopt these amendments and accordingly have not labeled the financial statements as those of a development stage entity and have not presented inception-to-date information on the respective financial statements.
NOTE 4 – Subsequent Events
The Company has evaluated subsequent events from the balance sheet date through the date the financial statements were issued and has determined that there are no such events that would have a material impact on the financial statements.
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In this report references to “Wings & Things,” “the Company,” “we,” “us,” and “our” refer to Wings & Things, Inc.
FORWARD LOOKING STATEMENTS
The U. S. Securities and Exchange Commission (“SEC”) encourages reporting companies to disclose forward-looking information so that investors can better understand future prospects and make informed investment decisions. This report contains these types of statements. Words such as “may,” “expect,” “believe,” “intend,” “anticipate,” “estimate,” “project,” or “continue” or comparable terminology used in connection with any discussion of future operating results or financial performance identify forward-looking statements. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. All forward-looking statements reflect our present expectation of future events and are subject to a number of important factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Executive Overview
We have not recorded revenues for the past two fiscal years and we are dependent upon financing to continue basic operations. Management intends to rely upon advances or loans from management, significant stockholders or third parties to meet our cash requirements, but we have not entered into written agreements guaranteeing funds and, therefore, no one is obligated to provide funds to us in the future. These factors raise doubt as to our ability to continue as a going concern. Our plan is to combine with an operating company to generate revenue.
As of the date of this report, our management has not had any discussions with any representative of any other entity regarding a business combination with us. Any target business that is selected may be a financially unstable company or an entity in its early stages of development or growth, including entities without established records of sales or earnings. In that event, we will be subject to numerous risks inherent in the business and operations of financially unstable and early stage or potential emerging growth companies. In addition, we may effect a business combination with an entity in an industry characterized by a high level of risk, and, although our management will endeavor to evaluate the risks inherent in a particular target business, there can be no assurance that we will properly ascertain or assess all significant risks. In addition, any business combination or transaction will likely result in a significant issuance of shares and substantial dilution to present stockholders of the Company.
We anticipate that the selection of a business opportunity will be complex and extremely risky. Because of general economic conditions, rapid technological advances being made in some industries and shortages of available capital, our management believes that there are numerous firms seeking the perceived benefits of becoming a publicly traded corporation. Such perceived benefits of becoming a publicly traded corporation include, among other things, facilitating or improving the terms on which additional equity financing may be obtained, providing liquidity for the principals of and investors in a business, creating a means for providing incentive stock options or similar benefits to key employees, and offering greater flexibility in structuring acquisitions, joint ventures and the like through the issuance of securities. Potentially available business combinations may occur in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex.
If we obtain a business opportunity, then it may be necessary to raise additional capital. We anticipate that we will sell our common stock to raise this additional capital. We expect that we would issue such stock pursuant to exemptions to the registration requirements provided by federal and state securities laws. The purchasers and manner of issuance will be determined according to our financial needs and the available exemptions to the registration requirements of the Securities Act of 1933. We do not currently intend to make a public offering of our stock. We also note that if we issue more shares of our common stock, then our stockholders may experience dilution in the value per share of their common stock.
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Liquidity and Capital Resources
We have not established an ongoing source of revenue sufficient to cover our operating costs and we have relied primarily upon loans from related and third parties to provide and pay for professional expenses. At June 30, 2015, we had cash of $2,545 compared to $851 cash at December 31, 2014. Our total liabilities increased to $252,242 at June 30, 2015 compared to $234,606 at December 31, 2014. The increase in total liabilities primarily represents loans of $6,200 from a third party, accrued interest of $6,736, along with accounts payable of $4,700 related to advances and consulting fees and accounts payable for professional services provided by or paid on our behalf by a shareholder during the first quarter ended June 30, 2015.
We intend to obtain capital from management, significant stockholders and third parties to cover minimal operations; however, there is no assurance that additional funding will be available. Our ability to continue as a going concern during the long term is dependent upon our ability to find a suitable business opportunity and acquire or enter into a merger with such company. The type of business opportunity with which we acquire or merge will affect our profitability for the long term.
During the next 12 months we anticipate incurring additional costs related to the filing of Exchange Act reports. We believe we will be able to meet these costs through advances and loans provided by management, significant stockholders or third parties. We may also rely on the issuance of our common stock in lieu of cash to convert debt or pay for expenses.
Results of Operations
We did not record revenues during 2015 and 2014. General and administrative expense decreased to $9,206 for the six month period ended June 30, 2015 compared to $9,900 for the six month period ended June 30, 2014. General and administrative expense decreased to $3,000 for the 2015 second quarter compared to $3,550 for the 2014 second quarter. The decrease in general and administrative expense in the 2015 interim periods primarily reflects reduced consulting and professional fees provided by or paid for by a related party.
Total other expense represents accrued interest on loans. Total other expense increased to $6,736 for the 2015 six month period compared to $6,529 for the 2014 six month period. Total other expense increased to $3,412 for the 2015 second quarter compared to $3,311 for the 2014 second quarter.
Accordingly, our net loss decreased to $15,942 for the 2015 six month period compared to $16,429 for the 2014 six month period and decreased to $6,412 for the 2015 second quarter compared to $6,861 for the 2014 second quarter. Management expects net losses to continue until we acquire or merge with a business opportunity.
Commitments and Obligations
At June 30, 2015 we recorded notes payable of $190,300 with accrued interest of $46,842. All of the loans are non-collateralized, carry interest at 8% and are due on demand. During the 2015 six month period we borrowed $6,200 from a third party.
At June 30, 2015 we recorded accounts payable of $15,100 representing administrative and professional services and out-of-pocket costs provided to or paid on behalf of the Company by a more than 5% shareholder, First Equity Holdings Corp.
| 8 |
Off-Balance Sheet Arrangements
We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources and would be considered material to investors.
Critical Accounting Policies
We qualify as an “emerging growth company” under the recently enacted Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, among other things, we will not be required to:
| • | Have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; |
| • | Submit certain executive compensation matters to shareholder advisory votes, such as “say-on-pay” and “say-on-frequency” |
| • | Obtain shareholder approval of any golden parachute payments not previously approved; and |
| • | Disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executives compensation to median employee compensation. |
In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
We will remain an “emerging growth company” for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion; (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three-year period.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable to smaller reporting companies.
ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) or 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in our filings under the Exchange Act is recorded, processed, summarized and reported within the periods specified in the rules and forms of the SEC. This information is accumulated to allow our management to make timely decisions regarding required disclosure. Our President, who serves as our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report and he determined that our disclosure controls and procedures were ineffective due to a control deficiency. During the period we did not have additional personnel to allow segregation of duties to ensure the completeness or accuracy of our information. Due to the size and operations of the Company we are unable to remediate this deficiency until we acquire or merge with another company.
Changes to Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Management conducted an evaluation of our internal control over financial reporting and determined that there were no changes made in our internal control over financial reporting during the quarter ended June 30, 2015 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.
| 9 |
PART II – OTHER INFORMATION
ITEM 6. EXHIBITS
Part I Exhibits
| No. | Description |
| 31.1 | Principal Executive Officer Certification |
| 31.2 | Principal Financial Officer Certification |
| 32.1 | Section 1350 Certification |
Part II Exhibits
| No. | Description |
| 3(i) | Articles of Incorporation (Incorporated by reference to exhibit 2.1 of Form 10-SB, File No. 000-30529, filed November 1, 2000) |
| 3(ii) | Bylaws of Wings & Things, Inc. (Incorporated by reference to exhibit 2.3 of the Form 10-SB, File No. 000-30529, filed November 1, 2000) |
| 101.INS | XBRL Instance Document |
| 101.SCH | XBRL Taxonomy Extension Schema Document |
| 101.CAL | XBRL Taxonomy Calculation Linkbase Document |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB | XBRL Taxonomy Label Linkbase Document |
| 101.PRE | XBRL Taxonomy Presentation Linkbase Document |
| 10 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| WINGS & THINGS, INC. | ||
| Date: August 10, 2015 | By: | /s/Greg L. Popp |
| Greg L. Popp | ||
| President and Director | ||
| Principal Financial Officer |
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