Ready Credit 10QSB 2007 Q2 Quarterly report (small business)

United States

Securities & Exchange Commission

Washington, D.C. 20549

FORM 10-QSB

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2006

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 000-50968

Ready Credit Corporation

(Exact name of small business issuer as specified in its charter)

Nevada	20-1667449
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

800 Nicollet Mall, Suite 2690

Minneapolis, MN 55402

(Address of principal executive offices)

612-338-8948

(Issuer’s telephone number)

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Check whether the issuer (1) filed all reports required to be filed by section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES [X] NO [ ]

Indicate by checkmark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

YES [ ] NO [X]

APPLICABLE TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 9,447,164 shares of common stock outstanding as of August 1, 2006, par value $.001 per share.

Transitional Small Business Disclosure Format (check one): YES [ ] NO [X]

Ready Credit Corporation and Subsidiary

Form 10-QSB

The Three and Six Months Ended June 30, 2006

Table of Contents

		Page No.

PART I	Financial Information	2

Item 1.	Financial Statements
	Consolidated Balance Sheets at June 30, 2006 (unaudited) and
	December 31, 2005 (audited)	2

	Consolidated Statements of Operations for the three and six months ended
	June 30, 2006 and 2005 and for the period from inception
	to June 30, 2006 (unaudited)	3

	Consolidated Statements of Cash Flows for the six months ended June 30, 2006
	and 2005 and for the period from inception to June 30, 2006 (unaudited)	4

	Notes to Consolidated Financial Statements	5

Item 2.	Management’s Discussion and Analysis or Plan of Operation	10

Item 3.	Controls and Procedures	17

PART II	Other Information	17

Item 2.	Unregistered Sales of Equity Securities	17

Item 4.	Submission of Matters to a Vote of Security Holders	18

Item 6.	Exhibits	18

SIGNATURES		18

PART I - Financial Information

Item 1. Financial Statements

Ready Credit Corporation and Subsidiary

(A Development Stage Company)

Consolidated Balance Sheets

		At June 30, 2006		At December 31, 2005
		Unaudited		Audited
ASSETS
CURRENT ASSETS:

Cash	$	232,080	$	189,437
Prepaid expenses		17,971		15,937
Total current assets		250,051		205,374

Equipment, net		339,553		11,044
Deposit on long-lived assets		-		111,000
Total assets	$	589,604	$	327,418

LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES:
Accounts payable	$	218,596		$	154,724
Accrued expenses		48,550			95,561
Notes payable		125,000			250,000
Total current liabilities		392,146			500,285

STOCKHOLDERS’ EQUITY (DEFICIT):
Common stock, par value $.001 per share:
Authorized shares--50,000,000
Issued and outstanding shares: 9,372,164 and 8,225,000 at June 30, 2006 and December 31, 2005, respectively		9,372			8,225
Additional paid-in capital		1,916,381			672,889
Deficit accumulated during development stage		(1,728,295	)		(853,981	)
Total stockholders’ equity (deficit)		197,458			(172,867	)

Total liabilities and stockholders’ equity (deficit)	$	589,604		$	327,418

See accompanying notes to consolidated financial statements.

Ready Credit Corporation and Subsidiary

(A Development Stage Company)

Consolidated Statements of Operations

(Unaudited)

	For the Three Months Ended June 30,						For the Six Months Ended June 30,						Inception through June 30,
		2006			2005			2006			2005			2006
OPERATING EXPENSES:
General and administrative	$	294,998		$	316,129			600,221		$	355,387		$	1,450,641
Sales and marketing		152,777			-			263,511			-			263,511
Total Operating Expenses:		447,775			316,129			863,732			355,387			1,714,152

Operating loss		(447,775	)		(316,129	)		(863,732	)		(355,387	)		(1,714,152	)

OTHER INCOME (EXPENSE):
Interest expense		(4,417	)		-			(10,582	)		-			(14,143	)
Net Loss:	$	(452,192	)	$	(316,129	)		(874,314	)	$	(355,387	)	$	(1,728,295	)

NET LOSS PER COMMON SHARE:
Basic and diluted	$	(0.05	)	$	(0.04	)	$	(0.10	)	$	(0.05	)	$	(0.25	)

WEIGHTED-AVERAGE NUMBER OF SHARES OUTSTANDING:
Basic and diluted		9,080,885			8,323,077			8,742,461			6,861,326			6,888,614

See accompanying notes to consolidated financial statements.

Ready Credit Corporation and Subsidiary

(A Development Stage Company)

Consolidated Statements of Cash Flows

(Unaudited)

	For the Six Months Ended June 30,							Inception through June 30,
		2006			2005			2006
Operating activities
Net loss	$	(874,314	)	$	(355,387	)	$	(1,728,295	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		39,059			399			41,451
Stock option expense		98,582			-			98,582
Common stock issued for distribution contract		-			10,000			10,000
Common stock issued for services		-			5,000			5,000
Changes in operating assets and liabilities:
Prepaid expenses		(2,034	)		(26,541	)		(17,971	)
Accounts payable		63,872			41,073			218,596
Accrued expenses		(40,847	)		21,865			54,714
Net cash used in operating activities:		(715,682	)		(303,591	)		(1,317,923	)

Investing activities
Purchases of equipment		(256,568	)		(11,820	)		(270,004	)
Deposit on equipment		-			-			(111,000	)
Net cash used in investing activities:		(256,568	)		(11,820	)		(381,004	)

Financing activities
Proceeds from sale of common stock, net of issuance costs		-			550,344			550,344
Proceeds from sale of common stock and warrants, net of issuance costs		1,014,893			-			1,135,663
Cancellation of common shares		-			-			(5,000	)
Proceeds from loan payable - related party		-			-			1,000
Payments on loan payable - related party		-			(1,000	)		(1,000	)
Proceeds from notes payable		-			-			250,000
Net cash provided by financing activities:		1,014,893			549,344			1,931,007
Increase in cash and cash equivalents		42,643			233,933			232,080
Cash and cash equivalents at beginning of period		189,437			1,000			-
Cash at end of period:	$	232,080		$	234,933		$	232,080

Noncash reclass of deposit on long-lived assets to equipment	$	111,000		$	-		$	111,000

Conversion of notes payable and accrued interest into common stock and warrants	$	131,164		$	-		$	131,164

See accompanying notes to consolidated financial statements.

Ready Credit Corporation. and Subsidiary

Notes to Consolidated Financial Statements

June 30, 2006 and 2005

(unaudited)

Note 1. Business Description.

The Company provides debit cards through convenient, easy to use self-service kiosks. Prepaid debit cards offer consumers a cost-effective and flexible means of managing personal assets, paying bills and taking advantage of the millions of retail locations that accept credit cards.

Pursuant to an Amended and Restated Agreement and Plan of Merger dated as of May 3, 2005 (the “Merger Agreement”), by and among Ready Credit Corporation (f/k/a Thunderball Entertainment, Inc. and also f/k/a Philadelphia Mortgage Corp., the “Company” or “Ready Credit”), Philadelphia Mortgage Newco, Inc., a Minnesota corporation and wholly owned subsidiary of the Company (“Merger Subsidiary”), and Domino Entertainment, Inc., a Minnesota corporation (f/k/a Thunderball Entertainment, Inc., “Domino”), Merger Subsidiary merged with and into Domino, with Domino remaining as the surviving entity and a wholly owned operating subsidiary of the Company. The merger was effective as of May 13, 2005.

Prior to the merger and pursuant to the Merger Agreement, the Company cancelled 133,334 shares of common stock held by the Company’s pre-merger shareholders and issued 459,141 shares of restricted common stock to certain pre-merger shareholders. As a result, there were 600,000 shares of Company common stock outstanding immediately prior to the merger. At the effective time of the merger, the legal existence of Merger Subsidiary ceased, and all 8,000,000 shares of common stock of Domino that were outstanding immediately prior to the merger and held by Domino’s shareholders were cancelled, with one share of common stock of Domino issued to the Company. Simultaneously, the former holders of Domino common stock received an aggregate of 8,000,000 shares of common stock of the Company, representing approximately 93.0% of the Company’s common stock outstanding immediately after the merger.

Generally accepted accounting principles in the United States of America generally require that the company whose shareholders retain a majority interest in a business combination be treated as the acquiror for accounting purposes. As a result, for accounting purposes, the merger was treated as a recapitalization of Domino rather than as a business combination. The assets and liabilities resulting from the reverse acquisition were the Domino assets and liabilities (at historical cost). There were no assets or liabilities on Ready Credit’s books at the time of the merger. Accordingly, when the term “Company” is used herein, it is referring to business and financial information of Domino. The Company expensed $205,768 of costs related to the merger during the three months ended June 30, 2005. The fiscal year for the Company has been changed from January 31 to December 31 to comport with the fiscal year for Domino.

The Company is a development stage company that has not generated any revenues to date.

The accompanying consolidated financial statements have been prepared on the basis that the Company will continue as a going concern. The Company had significant operating losses for the three and six months ended June 30, 2006, the year ended December 31, 2005 and for the period from October 1, 2004 (inception) to June 30, 2006, and had an accumulated deficit at June 30, 2006. The Company does not have adequate liquidity to fund its operations throughout fiscal 2006. These conditions raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this condition. To provide additional working capital, management intends to seek additional financing. If the Company is not able to raise additional working capital, it would have a material adverse effect on the operations of the Company.

Note 2. Summary of Significant Accounting Policies.

Interim Financial Information. The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and pursuant to the rules and regulations of the U. S. Securities and Exchange Commission (the “SEC”) for interim financial information. Accordingly, 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 omitted pursuant to such rules and regulations. Operating results for the three and six months ended June 30, 2006 are not necessarily indicative of the results that may be expected for the year ending December 31, 2006. The accompanying consolidated financial statements and related notes should be read in conjunction with the Company’s audited financial statements, and notes thereto, for the fiscal year ended December 31, 2005 contained in its Annual Report on Form 10-KSB for the year ended December 31, 2005.

The financial information furnished reflects, in the opinion of management, all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the results of the interim periods presented.

Use of Estimates. The preparation of these consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect the reported amounts and disclosures in the consolidated financial statements and accompanying notes. Actual results could differ from these estimates.

Fair Value of Financial Instruments. The carrying amounts for all financial instruments approximate fair value. The carrying amounts for cash and cash equivalents, accounts payable, accrued expenses and loan payable approximate fair value because of the short maturity of these instruments.

Cash and Cash Equivalents. The Company maintains its cash in high quality financial institutions. The balances, at times, may exceed federally insured limits.

Equipment. Equipment is stated at cost. Depreciation of an asset was recognized on the straight-line basis over the asset’s estimated useful life of three years. Maintenance, repairs and minor renewals are expensed when incurred. Sales and retirements of depreciable property are recorded by removing the related cost and accumulated depreciation from the accounts. Gains or losses on sales and retirements of property are reflected in the Company’s results of operations.

Management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to its fair value, which considers the future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment recognized is measured by the amount by which the carrying amount of the assets exceeds their fair value. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs of disposal.

Income Taxes. The Company utilizes the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to temporary differences between the financial statement and income tax reporting bases of assets and liabilities. Deferred tax assets are reduced by a valuation allowance to the extent that realization is not assured.

Research and Development Costs. The Company expenses research and development costs as incurred. Research and development expense was $26,145 and $101,574 for the three and six months ended June 30, 2006, respectively, and $308,920 for the period from October 1, 2004 (inception) to June 30, 2006, respectively. There were no research and development expenses for the three and six months ended June 30, 2005.

Net Loss Per Common Share. Basic and diluted loss per common share is computed by dividing net loss by the weighted-average number of common shares outstanding for the reporting period. Dilutive common-equivalent shares have not been included in the computation of diluted net loss per share because their inclusion would be antidilutive. Antidilutive common-equivalent shares issuable based on future exercise of stock options or warrants could potentially dilute basic loss per common share in subsequent years. All options and warrants outstanding were antidilutive for the three and six months ended June 30, 2006 and 2005, and the period from October 1, 2004 (inception) to June 30, 2006.

For the three and six months ended June 30, 2006 and for the period from inception through March 31, 2006, 1,130,000 shares attributable to outstanding stock options and 1,272,164 for warrants were excluded from the calculation of diluted earnings per share because the effect was anti-dilutive. All common share equivalents are anti-dilutive in periods where the Company generates a net loss.

Stock-Based Compensation. On December 16, 2004, the Financial Accounting Standards Board, or FASB, issued Statement of Financial Accounting Standards (SFAS) No. 123(R), “Share-Based Payment”, which is a revision of SFAS No. 123 and supersedes APB Opinion No. 25. SFAS No. 123 (R) requires all share-based payments to employees, including grants of employee stock options, to be valued at fair value on the date of grant, and to be expensed over the applicable vesting period. Pro forma disclosure of the income statement effects of share-based payments is no longer an alternative. SFAS 123 (R) is effective for all share-based awards granted on or after September 1, 2005. In addition, companies must also recognize compensation expense related to any awards that are not fully vested as of the effective date. Compensation expense for the unvested awards will be measured based on the fair value of the awards previously calculated in developing the pro forma disclosures in accordance with the provisions of SFAS No. 123. We implemented SFAS No. 123(R) on January 1, 2006 using the modified prospective method.

As more fully described in our Annual Report on Form 10-KSB for the year ended December 31, 2005, the Company has granted stock options over the years to employees and directors under various stockholder approved stock option plans. At June 30, 2006, 1,130,000 stock options were outstanding. The fair value of each option grant was determined as of grant date, utilizing the Black-Scholes option pricing model. Based on these valuations, the Company recognized compensation expense of $51,052 ($0.01 per share) and $98,582 ($0.01 per share) in the three and six months ended June 30, 2006, respectively, related to the amortization of the unvested portion of these options as of January 1, 2006 and vested options through June 30, 2006. The amortization of each option grant will continue over the remainder of the vesting period of each option grant. Currently, the Company expects that the impact on earnings for the remainder of the year ended December 31, 2006 for stock based compensation will be approximately $116,192 and estimates the impact on earnings in future years to be approximately $581,000.

The following significant assumptions were utilized to calculate the fair value information presented utilizing the Black-Scholes pricing model:

	Three Months Ended June 30,			Six Months Ended June 30,			Inception Through June 30,
	2006		2005	2006		2005	2006
Risk Free interest rate	4.94	%	N/A	4.62	%	N/A	4.18	%
Expected life	5.0 years		N/A	5.0 years		N/A	4.25	years
Expected volatility	127	%	N/A	114	%	N/A	94	%
Expected dividends	0	%	N/A	0	%	N/A	0	%

Expected volatility is based on implied volatility from historical volatility of our stock price since May 13, 2005. The Company uses historical Company and industry data along with implied data to estimate the expected option life and the expected dividend yield. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury rate in effect at the time of grant. Based upon the lack of history, the Company will estimate a forfeiture rate upon the granting of options which will be considered to be a reasonable indicator of future performance in the opinion of management.

Note 3. Note Payable

In November 2005, the Company issued two unsecured short-term promissory notes to two separate investors in exchange for a total of $250,000. Both of the promissory notes accrue interest at the rate of 10% per annum, and were due and payable in full upon the earlier of (i) May 10, 2006 or (ii) the earlier of (x) the Company’s completion of a financing transaction on or prior to December 7, 2005 which generates $750,000 in proceeds as a direct result of introductions made by Corporate Capital Management, L.L.C. to the Company or (y) the Company’s completion of a financing transaction which generates $1,000,000 in proceeds.

For the three months ended June 30, 2006 and 2005, the Company recorded interest expense of $4,417 and $0, respectively, and for the six months ended June 30, 2006 and 2005 and the period from October 1, 2004 (inception) to March 31, 2006, the Company recorded interest expense of $10,582, $0 and $14,143, respectively. $7,979 of interest expense was accrued at June 30, 2006.

The due date of one of the promissory notes had been extended to June 15, 2006, but was still outstanding on June 30, 2006. In May 2006, the other promissory note, along with accrued interest of $6,164, was converted into 131,164 units under the Company’s Third Offering (See Note 5).

Note 4. Loan Payable - Related Party

At December 31, 2004, the Company had an unsecured loan payable of $1,000. The loan was due upon demand and was non-interest bearing. In January 2005, the Company repaid the $1,000 loan payable - related party.

Note 5. Shareholder’s Deficit

Common Stock

In January 2005, Domino began a private placement which ended in February 2005 (the “Offering”). In the Offering, Domino sold a total of 5,500,000 shares of its common stock for a per share price of $0.01 (i.e., raising a gross total of $55,000). The Offering was a private placement made under Rule 506 promulgated under the Securities Act of 1933, as amended.

In January 2005, Domino issued 1,000,000 shares of its common stock to Aurora Technology, Inc. (“Aurora”) pursuant to an agreement whereby Aurora transferred to Domino its rights to a distribution agreement by and between Aurora and Alta Co. Ltd. The agreement with Alta Co. Ltd. expires on January 1, 2007. The Company expensed the value of the shares of common stock issued to Aurora, $10,000, since there was no value assigned to future services related to the distribution agreement.

In January 2005, Domino entered consulting agreements with 4 individuals, each of which were shareholders of Domino. Domino issued a total of 500,000 shares of its common stock to the four individuals as compensation for the consulting services. The shares were valued at $.01 per share, based upon the last sales price of Domino common stock on the day the consulting agreements were executed, and charged $5,000 to expense.

In February 2005, Domino began a second private placement which ended in March 2005 (the “Second Offering”). In the Second Offering, Domino sold a total of 1,000,000 shares of its common stock for a per share price of $0.50 (i.e., raising a gross total of $500,000). The Second Offering was a private placement made under Rule 506 promulgated under the Securities Act of 1933, as amended.

At the effective time of the merger transaction among the Company, Domino, and Merger Subsidiary, the legal existence of Merger Subsidiary ceased, and all 8,000,000 shares of common stock of Domino that were outstanding immediately prior to the Merger and held by Domino’s shareholders were cancelled, with one share of common stock of Domino issued to the Company. Simultaneously, the former holders of Domino common stock received an aggregate of 8,000,000 shares of common stock of the Company, representing approximately 93.0% of the Company’s common stock outstanding immediately after the Merger. Additionally, pursuant to the Merger Agreement, the Company cancelled 133,334 shares of common stock held by the Company’s shareholders and issued 459,141 shares of restricted common stock to certain of the Company’s shareholders.

In October 2005, the Company began a private placement offering of a maximum of 1,500,000 units for sale for a per unit price of $1.00 (the “Third Offering”). Each unit consists of one share of the Company’s common stock and a five-year warrant to purchase one additional share of the Company’s common stock at a purchase price $1.50 per share. As of June 30, 2006, the Company had sold 1,272,164 units. The Third Offering is a private placement made under Rule 506 promulgated under the Securities Act of 1933, as amended. The securities offered and sold (or deemed to be offered and sold, in the case of underlying shares of common stock) in the Third Offering have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The disclosure about the private placemet contained in this report does not constitute an offer to sell or a solicitation of an offer to buy any securities of the Company, and is made only as required under applicable law and related reporting requirements, and as permitted under Rule 135c under the Securities Act.

Note 6. Stock Options and Warrants

At June 30, 2006 and December 31, 2005, the Company had 1,272,164 and 125,000 warrants outstanding, resepectively, with exercise prices of $1.50. The warrants expire at various times in 2010 and 2011 and are fully vested.

In July 2005, the Company’s board of directors approved a stock option plan (“2005 Stock Option Plan”) to provide incentives to employees, directors, officers and consultants and in July 2006, the Company’s shareholders approved the adoption of the 2005 Stock Option Plan. Currently, 1,500,000 shares of common stock are reserved for issuance under the 2005 Stock Option Plan. Under the 2005 Stock Option Plan, options may be issued as either incentive stock options or non-statutory stock options, and are valued at the fair market value of the underlying stock on the date of grant. The exercise price of incentive stock options may not be less than 100% of the fair market value of the stock underlying the option on the date of the grant and, in some cases, may not be less than 110% of such fair market value. As of June 30, 2006, the Company had granted options for 1,130,000 shares of common stock, with exercise prices ranging from $1.01 to $1.40, under the 2005 Stock Option Plan.

Note 7. Related Party Transactions

A company wholly-owned by a director and the former Chairman and Chief Executive Officer of the Company and employing a director and Chief Financial Officer of Ready Credit charged approximately $27,769 and $15,143 for rent and consulting services during the three months ended June 30, 2006 and 2005, respectively, and $53,706, $27,898 and $118,186 for rent and consulting services for the six months ended June 30, 2006 and 2005 and for the period from October 1, 2004 (inception) to June 30, 2006, respetively. The rent agreement is month-to-month with a base rent of $3,000 per month.

A limited liability company, owned by the spouse and daughter of a director and the former Chairman and Chief Executive Officer of the Company, loaned the Company $1,000 in October 2004. The loan was due upon demand and was non-interest bearing. The loan was repaid in January 2005.

Note 8. Processing Agreement

On June 14, 2006, the Company entered into a Processing Only Master Client Agreement (the “Agreement”) with RBS Lynk Incorporated, a Georgia corporation. The Agreement is effective as of March 29, 2006. RBS Lynk is a certified card processor with the Card Associations, and provides host-based services for stored-value and prepaid card-issuing programs. Under the Agreement, RBS Lynk will provide card-processing services to the Company through the Company’s sponsor bank, Palm Desert National Bank, N.A. In exchange for the services, the Agreement requires the Company to pay RBS Lynk certain fees, including initial set-up fees, training and data-conversion fees, and per-transaction fees. In this regard, the Agreement provides, after an initial “ramp-up” period, a minimum monthly per-transaction revenue guarantee to RBS Lynk.

The Agreement has an initial term of two years which will renew for successive one-year periods unless a party notifies the other of its desire to terminate at least 90 days prior to the next-scheduled termination date. The Company may, however, terminate the Agreement earlier by paying RBS Lynk a termination fee, which fee decreases as the Agreement matures. The Agreement also contains other customary early-termination provisions, representations, warranties and covenants.

Note 9. Subsequent Event

In July 2006, the Company sold an additional 75,000 units under the Third Offering. These units were not and have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

Item 2. Management’s Discussion and Analysis or Plan of Operation

The accompanying management’s discussion and analysis of the Company’s consolidated financial condition and results of operations should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Company’s audited financial statements, and notes thereto, for the fiscal year ended December 31, 2005, included in our Annual Report on Form 10-KSB for the year ended December 31, 2005.

General

The Company has begun providing prepaid debit cards through convenient, easy to use self-service kiosks. Prepaid debit cards offer millions of consumers a cost-effective and flexible means of managing personal assets, paying bills and taking advantage of the millions of retail locations that accept credit cards.

Generally accepted accounting principles in the United States of America generally require that the company whose shareholders retain a majority interest in a business combination be treated as the acquiror for accounting purposes. As a result, for accounting purposes, the merger was treated as a recapitalization of Domino rather than as a business combination. The assets and liabilities resulting from the reverse acquisition were the Domino assets and liabilities (at historical cost). There were no assets or liabilities on the Company’s books at the time of the merger. In addition, the Company’s fiscal year has been changed from January 31 to December 31 to correspond with the fiscal year for Domino.

On May 19, 2005, the Company changed its name from Philadelphia Mortgage Corp. to Thunderball Entertainment, Inc. through a short-form merger with Thunderball Entertainment, Inc., as permitted under Nevada law. On August 17, 2005, the Company changed its name to Ready Credit Corporation as permitted under Nevada law.

Plan of Operation and Results of Operations

The Three and Six Months Ended June 30, 2006 Compared to the Three and Six Months Ended June 30, 2005

The Company is a development stage company that has not generated any revenues to date.

General and Administrative Expenses. General and administrative expenses for the three months ended June 30, 2006 and 2005 were $294,998 and $316,129, respectively. General and administrative expenses for the six months ended June 30, 2006 and 2005 were $600,221 and $355,387, respectively. General and administrative expense for the three months ended June 30, 2005 includes $205,768 of expense related to the merger. The increase in non-merger related general and administrative expenses for the three and six months ended June 30, 2006 as compared with the three and six months ended June 30, 2005 was primarily the result of expenses related to the Company commencing operations in the prepaid debit card business including salary expense, stock option expense, consulting fees, and depreciation expense.

Sales and Marketing Expenses. Sales and marketing expenses for the three months ended June 30, 2006 and 2005 were $152,777 and $0, respectively. Sales and marketing expenses for the six months ended June 30, 2006 and 2005 were $263,511 and $0, respectively. The increase in sales and marketing expenses for the three and six months ended June 30, 2006 as compared with the three and six months ended June 30, 2005 was primarily the result of expenses related to the Company commencing operations in the prepaid debit card business including salary expense, and consulting fees related to the Company’s website development.

Net Loss. The Company incurred a net loss of $452,192 and $316,129 for the three months ended June 30, 2006 and 2005, respectively. The Company incurred a net loss of $874,314 and $355,387 for the six months ended June 30, 2006 and 2005, respectively. The increase in the net losses for the three and six months ended June 30, 2006 as compared with the three and six months ended June 30, 2005 was primarily the result of the Company commencing operations in the prepaid debit card business which in turn resulted in salary expense, stock option expense, consulting fees, website development and depreciation expense during 2006.

Liquidity and Capital Resources. The Company had a working capital deficit of $142,095 and cash of $232,080 at June 30, 2006. Cash used in operations was $715,682 for the six months ended June 30, 2006. For the six months ended June 30, 2006, the primary uses of cash were to fund the Company’s net loss and a decrease in accrued expenses partially offset by non-cash expenses related to stock option expense and depreciation and amortization. Further partially offsetting the cash used related to the Company’s net loss was an increase in accounts payable. Cash used in operations was $303,591 for the six months ended June 30, 2005, primarily to fund the Company’s net loss and due to an increase in prepaid expenses. These uses were partially offset by increases in accounts payable and accrued expenses and by non-cash charges related to common stock issued for a distribution contract and services.

Cash used in investing activities was $256,568 and $11,820 for the six months ended June 30, 2006 and 2005, respectively. For the six months ended June 30, 2006 and 2005, the Company used cash for capital expenditures.

Cash provided by financing activities was $1,014,893 and $549,344 for the six months ended June 30, 2006 and 2005, respectively. For the six months ended June 30, 2006 proceeds from the private placement sale of 1,147,164 shares of the Company’s common stock and warrants to purchase an additional 1,147,164 shares of the Company’s common stock at a purchase price of $1.50, net of issuance costs, provided the cash from financing activities. Neither the securities offered and sold in the private placement, nor the shares of common stock underlying any such securities, have been registered under the Securities Act and therefore may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The disclosure about the private placement contained in this report does not constitute an offer to sell or a solicitation of an offer to buy any securities of the Company, and is made only as required under applicable law, and as permitted under Rule 135c under the Securities Act.

In January 2005, Domino Entertainment, Inc. began a private placement offering which ended in February 2005. In that offering, Domino Entertainment, Inc. sold a total of 5,500,000 shares of its common stock for a per-share price of $0.01, raising a gross total of $55,000. In February 2005, Domino Entertainment, Inc. began a second private placement offering which ended in March 2005. In that second offering, Domino sold a total of 1,000,000 shares of its common stock for a per-share price of $0.50, raising a gross total of $500,000. Domino Entertainment, Inc. incurred total legal costs related to these private placements of approximately $5,000. All the shares of Domino Entertainment were exchanged on one-for-one basis into shares of the Company upon the consummation of the reverse merger.

The Company expects to spend a significant amount of cash developing its prepaid debit card dispensing machines and purchasing capital equipment purchases over the next 12 months, primarily as it places its machines in facilities. The Company expects that it will use debt and/or equity financing to purchase this equipment. The Company also anticipates hiring additional personnel over the next 12 months as it grows its business.

Management believes that its cash should be sufficient to satisfy its cash requirements through August 2006. The Company will need additional financing to meet its needs beyond that period and has been actively pursuing such additional financing.

Risk Factors

We have no operating history and we anticipate incurring future losses.

We are in the early stages of operating a business to provide prepaid debit cards. We are therefore subject to all of the risks and uncertainties inherent in establishing a new business. We have no prior operating history for these products from which to evaluate our likelihood of success in operating our business, generating any revenues or achieving profitability. In sum, we have very limited assets, have only recently begun generating operating revenue and have uncertain prospects of future profitable operations. Our operations may not be successful and the likelihood of our success must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with the formation of a new business, development of new technology and the competitive environment in which we plan to operate. We anticipate that we will incur losses for the foreseeable future.

We will need additional financing in the future and any such financing will likely dilute our existing shareholders or involve covenants restricting our operations.

We will likely require additional financing before we can generate revenues needed to sustain operations. In particular, we believe that our current cash is sufficient to continue current and anticipated operations only through August 2006. Additional financing could be sought from a number of sources, including but not limited to additional sales of equity or debt securities (including equity-linked or convertible debt securities), loans from banks or other financial institutions, and loans from affiliates of the Company. We may not, however, be able to obtain any such additional financing when needed, or do so on terms and conditions acceptable or favorable to the Company, if at all. If financing is not available, we may be forced to abandon our business plans or our entire business, discontinue our preparation and filing of public disclosure reports with the SEC, or dissolve the Company. If we are able to obtain financing, any additional equity or equity-linked financing would dilute our shareholders, and any additional debt financing may involve restricting certain operational restrictions.

Our independent auditors have substantial doubt about our ability to continue as a going concern.

We have had net losses for the three and six months ended June 30, 2006, the year ended December 31, 2005, and for the period from October 1, 2004 (inception) to June 30, 2006, and we had an accumulated deficit as of June 30, 2006. Since the consolidated financial statements for these periods were prepared assuming that we would continue as a going concern, in the view of our independent auditors, these conditions raise substantial doubt about our ability to continue as a going concern. Furthermore, since we are pursuing a new line of business, this diminishes our ability to accurately forecast our revenues and expenses. At this time, we believe our ability to continue as a going concern depends, in large part, on our ability to raise sufficient capital through subsequent financing transactions. If we are unable to raise additional capital, we may be forced to discontinue our business.

Even if successfully developed, our prepaid debit cards may not be accepted by the marketplace.

The marketplace may not accept our prepaid debit cards due to our failure to successfully compete against products, lack of general demand, changing technology, or other reasons.

We will depend upon others to manufacture our card-dispensing kiosks (and card-delivery services), and as a result we will be unable to fully control the supply of our products to the market.

Our ability to develop, manufacture and successfully commercialize our products depends upon our ability to enter into and maintain contractual and collaborative arrangements with others. We do not intend to manufacture any of our kiosks; but instead intend to retain contract manufacturers. These manufacturers may not be able to supply our kiosks in the required quantities, at appropriate quality levels or at acceptable costs. We may be adversely affected by any difficulties encountered by such third-party manufacturers that result in product defects, production delays or the inability to fill orders and place machines on a timely basis. If a manufacturer cannot meet our quality standards and delivery requirements in a cost-efficient manner, we would likely suffer interruptions of delivery while we arrange for alternative manufacturing sources. Any extended disruption in the delivery of kiosks could result in our inability to satisfy customer demand. Disruptions in the delivery of our kiosks, even for short periods, may have a materially adverse effect on our business and results of operations.

Our reliance on third-party manufacturers and other third parties in other aspects of our business will reduce any profits we may earn from our products, and may negatively affect future product development.

As noted above, we currently intend to market and commercialize products manufactured by others, and in connection therewith we will likely be required to enter into manufacturing, licensing and distribution arrangements with third parties. These arrangements will likely reduce our profit margins. In addition, the identification of new financial services product candidates for development may require us to enter into licensing or other collaborative agreements with others. These collaborative agreements may require us to pay license fees, make milestone payments, pay royalties and/or grant rights, including marketing rights, to one or more parties. Any such arrangement will likely reduce our profits. Moreover, these arrangements may contain covenants restricting our product development or business efforts in the future.

We may not be able to enter into manufacturing agreements or other collaborative agreements on terms acceptable to us, if at all, which failure would materially and adversely affect our business.

We may not be able to enter into manufacturing or other collaborative arrangements with third parties on terms acceptable to us, if at all, when and as required. If we fail to establish such arrangements when and as necessary, we could be required to undertake these activities at our own expense, which would significantly increase our capital requirements and may delay the development, manufacture and installation of our prepaid debit card dispensing machines. If we could not find ways of addressing these capital requirements, we would likely be forced to sell or abandon our business.

We are highly dependent on the services provided by certain executives and key personnel.

Our success depends in significant part upon the continued service of certain senior management and other key personnel. In particular, we are materially dependent upon the services of Tim Walsh, a director of the Company and our President and Chief Executive Officer. If he should no longer serve the Company it would likely have a materially adverse impact on our business, financial condition and operations. We do not have an employment or non-compete agreement with Mr. Walsh. In addition, the Company has not secured any “key person” life insurance covering the life of Mr. Walsh.

Our success also depends on our ability to identify, hire, train, retain and motivate highly skilled technical, managerial, sales and marketing personnel. We intend to hire a number of sales, business development, marketing, technical and administrative personnel in the future. Competition for such personnel is intense and there can be no assurance that we will successfully attract, assimilate or retain a sufficient number of qualified personnel. The failure to retain and attract the necessary technical, managerial, sales and marketing and administrative personnel could have a material adverse impact on our business, financial condition and operations.

We operate in a highly competitive environment.

We believe it will be difficult to compete in the market for prepaid credit cards because there are a number of established companies that currently offer products and services that will compete directly with our prepaid debit cards. In particular, Eufora, UniRush Financial Services, Purpose Solutions, LLC and CashPass Network enjoy established market position in the market for prepaid debit cards. If these well-established companies were to focus their resources on developing financial kiosks to dispense instant prepaid credit cards, our ability to capitalize on the perceived market opportunities could be significantly impaired. Moreover, these competitors (and others) may be better able to provide similar products and services (and a wider range of products and services) over a broader geographic area.

More generally, the competition among financial services providers to attract and retain customers is intense. Customer loyalty can be easily influenced by a competitor’s new products, especially offerings that provide cost savings to the customer. The development of a successful new product by a competitor could adversely affect the market demand for our products and impair our ability to generate revenues.

We believe that the financial services industry will become even more competitive as a result of legislative, regulatory and technological changes and the continued consolidation of the industry. Technology has lowered barriers to entry and made it possible for non-banks, like the Company, to offer products and services traditionally provided by banks, such as automatic funds transfer and automatic payment systems.

We have limited trademark rights, copyrights, or proprietary business methods.

We currently have limited proprietary patents, trademark right and copyrights relating to our business. We expect to seek protection of our trademark rights and other intellectual property rights as necessary to protect our business. However, we may not be able to obtain meaningful intellectual property rights relating to any aspects of our business, and we may discover that a third party possess rights to intellectual property necessary for our business, which could require us to enter into a license agreement with such third party on terms that may not be favorable to us. Moreover, such a third party may not be willing to license technology to us at all.

We may be unable to protect intellectual property rights that we obtain, and we may become subject to infringement claims by third parties.

Despite our efforts to protect our intellectual property, third parties may infringe or misappropriate our intellectual property or may develop software or technology competitive to ours. Our competitors may independently develop similar technology, duplicate our products or services or design around our intellectual property rights. As a result, we may have to litigate to enforce and protect our intellectual property rights to determine their scope, validity or enforceability. Intellectual property litigation is particularly expensive, could cause a diversion of resources, and may not prove successful. The loss of intellectual property protection or the inability to secure or enforce intellectual property protection could materially harm our business and ability to compete.

We also may be subject to costly litigation in the event our products or technology infringe upon another party’s proprietary rights. Third parties may have, or may eventually be issued, patents that would be infringed by our products or technology. Any of these third parties could make a claim of infringement against us with respect to our products or technology. We may also be subject to claims by third parties for breach of copyright, trademark or license usage rights. Any such claims and any resulting litigation could subject us to significant liability for damages. An adverse determination in any litigation of this type could require us to design around a third party’s patent or to license alternative technology from another party. In addition, litigation is time consuming and expensive to defend and could result in the diversion of the time and attention of our management and employees. Any claims from third parties may also result in limitations on our ability to use the intellectual property subject to these claims.

Our computer systems are subject to security risks, and breaches in our systems could adversely effect our business and financial condition.

We currently maintain a site on the world wide web at www.myreadycard.com to promote and enhance our services and products. Like most computer systems, our systems are subject to the risks of computer viruses and

unauthorized individuals (hackers) obtaining access to and inadvertently or purposefully damaging them. The Company believes the implemented security systems and virus-detection controls significantly reduce these risks. If those systems were nonetheless compromised, our customers may be unable to access the system. In addition, sensitive information regarding its customers that is maintained on its system may become publicly available. In such an event, we may be exposed to liability from customers, may lose customers and may suffer significant damage to our business reputation. Any of these events could have a materially adverse effect on our business and financial condition.

Lack of system integrity or credit quality related to funds settlement could result in a financial loss.

We settle funds on a daily basis. These payment activities rely upon the technology infrastructure that facilitates the verification of activity with counterparties and the facilitation of the payment. If the continuity of operations or integrity of processing were compromised this could result in a financial loss to us due to a failure in payment facilitation.

The financial services industry is highly regulated and the Company may incur substantial costs and face unanticipated liabilities arising from changes in applicable regulations.

The financial services industry in general is heavily regulated at the federal and state levels. This regulation is designed primarily to protect consumers, depositors and the banking system as a whole, not shareholders of the Company. Congress and state legislatures and federal and state regulatory agencies periodically review banking laws, regulations and policies for possible changes. Changes to statutes, regulations or regulatory policies, including changes in interpretation or implementation of statutes, regulations or policies, could affect the Company in substantial and unpredictable ways, including limiting the types of financial services and products the Company may offer, increasing the ability of non-banks to offer competing financial services and products and/or increasing our cost structures. Also, our failure to comply with laws, regulations or policies could result in sanctions and fines by regulatory agencies that are financially material and damaging to our reputation.

Our officers and directors, together with certain affiliates, possess substantial voting power with respect to our common stock, which could adversely affect the market price of our common stock.

As of July 20, 2006, our officers and directors collectively possessed beneficial ownership of 2,883,333 shares of our common stock, which represents approximately 29.6% of our common stock. D. Bradly Olah possessed beneficial ownership of a total of 1,825,000 shares of common stock, which represents approximately 19.1% of our common stock. When taken together, our directors, officers and significant shareholders have beneficial ownership of approximately 48.7% of our common stock. This represents a significant portion of the voting power of the Company’s shareholders. As a result, our directors and officers, together with significant shareholders, have the ability to significantly control our management and affairs through the election and removal of our entire board of directors, and all other matters requiring shareholder approval, including the future merger, consolidation or sale of all or substantially all of our assets. This concentrated control could discourage others from initiating any potential merger, takeover or other change-of-control transaction that may otherwise be beneficial to our shareholders. As a result, the return on an investment in our common stock through the market price of our common stock or ultimate sale of our business could be adversely affected.

Our common stock trades only in an illiquid trading market.

Trading of our common stock is conducted through the “pink sheets.” This has an adverse effect on the liquidity of our common stock, not only in terms of the number of shares that can be bought and sold at a given price, but also through delays in the timing of transactions and reduction in security analysts’ and the media’s coverage of our Company and its common stock. This may result in lower prices for our common stock than might otherwise be obtained and could also result in a larger spread between the bid and asked prices for our common stock.

There is currently little trading volume in our common stock, which may make it difficult to sell shares of our common stock.

In general, there has been very little trading activity in our common stock. The relatively small trading volume will likely make it difficult for our shareholders to sell their shares as and when they choose. Furthermore, small trading volumes generally depress market prices. As a result, you may not always be able to resell shares of our common stock publicly at the time and prices that you feel are fair or appropriate.

Because it is a “penny stock,” you may have difficulty selling shares of our common stock.

Our common stock is a “penny stock” and is therefore subject to the requirements of Rule 15g-9 under the Securities and Exchange Act of 1934. Under this rule, broker-dealers who sell penny stocks must provide purchasers of these stocks with a standardized risk- disclosure document prepared by the SEC. Under applicable regulations, our common stock will generally remain a “penny stock” until, and for such time, as its per-share price is $5.00 or more (as determined in accordance with SEC regulations), or until we meet certain net asset or revenue thresholds. These thresholds include the possession of net tangible assets (i.e., total assets less intangible assets and liabilities) in excess of $2,000,000 in the event we have been operating for at least three years or $5,000,000 in the event we have been operating for fewer than three years, and the recognition of average revenues equal to at least $6,000,000 for each of the last three years. We do not anticipate meeting any of the foregoing thresholds in the foreseeable future.

The penny-stock rules severely limit the liquidity of securities in the secondary market, and many brokers choose not to participate in penny-stock transactions. As a result, there is generally less trading in penny stocks. If you become a holder of our common stock, you may not always be able to resell shares of our common stock publicly at the time and prices that you feel are fair or appropriate.

We have no intention of paying dividends on our common stock.

To date, we have not paid any cash dividends and do not anticipate the payment of cash dividends in the foreseeable future. Accordingly, the only return on an investment in shares of our common stock, if any, may occur upon a subsequent sale of such shares.

Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements.

Critical Accounting Estimates

The Company’s critical accounting policies are those (i) having the most impact on the reporting of its financial condition and results, and (ii) requiring significant judgments and estimates. Due to the incipient nature of operations, the Company does not believe it has any critical policies or procedures.

Forward-Looking Statements

This Form 10-QSB contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements made in this report which are not historical in nature, including but not limited to statements using the terms “may,” “expect to,” “believe,” “should,” “anticipate,” and other language employing a future aspect, are referred to as forward-looking statements, should be viewed as uncertain and should not be relied upon. Although our management believes that the results reflected in or suggested by these forward-looking statements are reasonable, all forward-looking statements involve risks and uncertainties and our actual future results may be materially different from the expectations expressed in such forward-looking statements. In particular, all statements included herein regarding activities, events or developments that the Company expect, believe or anticipate will or may occur in the future, including such things as future capital expenditures (including the amount and nature thereof), business strategy and measures to implement strategy, competitive strengths, goals, expansion and other such matters are forward-looking statements. The foregoing list is not exhaustive, and the Company disclaims any obligation to subsequently revise any forward-looking statements to reflect events or circumstances after the date of such statements.

Actual events may differ materially from those anticipated in the forward-looking statements. Important factors that may cause such a difference include those risk factors summarized above. For additional information regarding these and other factors, see our Annual Report on Form 10-KSB for the year ended December 31, 2005.

Item 3. Controls and Procedures

The Company carried out an evaluation, with the participation of our Chief Executive and Chief Financial Officers, of the effectiveness, as of June 30, 2006, of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934). Based upon that evaluation, made at the end of the period, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms and such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure, and that there has been no significant change in such internal controls, or other factors which could significantly affect such controls including any corrective actions with regard to significant deficiencies or material weaknesses, since our evaluation.

PART II Other Information

Item 2. Unregistered Sales of Equity Securities

During the three months ended June 30, 2006, the Company issued an aggregate of 1,097,164 shares of common stock, together with five-year warrants to purchase an equivalent number of shares of common stock at a per-share price of $1.50. The Company received gross proceeds of $1,097,164 from these sales of unregistered securities. The Company relied on Sections 4(2), including but not limited to Regulation 506 thereunder, and 4(6) for purposes of claiming an exemption under the Securities Act of 1933, based primarily on the fact that that (i) there have been fewer than 20 investors, all of whom, either alone or through a purchaser representative, had knowledge and experience in financial and business matters such that each was capable of evaluating the risks of the investment, and (ii) the Company has obtained subscription agreements from the investors indicating that they are accredited investors and purchasing for investment only. A portion of the proceeds from these sales was received prior to April 1, 2006, but all securities issued in exchange therefor were issued during the period covered by this report.

The securities sold in these issuances were not registered under the Securities Act and therefore may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The disclosure about the private placement and related agreements contained in this report does not constitute an offer to sell or a solicitation of an offer to buy any securities of the Company, and is made only as required under applicable rules for filing current reports with the SEC, and as would be permitted by Rule 135c under the Securities Act.

Item 4. Submission of Matters to a Vote of Security Holders

At the annual meeting of shareholders held on July 13, 2006, the following proposals were adopted by the votes indicated:

1. Elect a Board of Directors to hold office until the next annual meeting of shareholders and until their successors are elected and qualified.

	Number of Shares
	For	Withheld
Thomas H. Healey	4,913,042	74,473
Timothy J. Walsh	4,962,183	25,332
Ronald E. Eibensteiner	4,913,042	74,473
Brian D. Niebur	4,913,042	74,473

2. Approve the Company’s 2005 Stock Option Plan.

Number of Shares Voted			Broker Non-votes
Voted For	Voted Against	Abstain
4,413,145	74,873	100,177	399,320

Item 6. Exhibits

(a) Exhibits

10.1

Processing Only Master Client Agreement by and between the Registrant and RBS Lynk Incorporated dated March 29, 2006.

31.1

Rule 13a-14(a) Certification of Chief Executive Officer.

31.2

Rule 13a-14(a) Certification of Chief Financial Officer.

Section 1350 Certification.

(Certain terms related to pricing indicated by ** in Exhibit 10.1 have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934.)

SIGNATURES

Pursuant to the registration 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.

	READY CREDIT CORPORATION


Date: August 11, 2006	By:	/s/ Tim J. Walsh
	Title:	President and Chief Executive Officer



Date: August 11, 2006	By:	/s/ Brian D. Niebur
	Title:	Chief Financial Officer
		(Principal Accounting Officer)

Ready Credit (RCTC) Inactive 10QSB2007 Q2 Quarterly report (small business)