UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
| [ X ] | QUARTERLY REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended April 30, 2010
| [ ] | TRANSITION REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from _________________________ to _________________________
Commission file number 000-52958
| MOBILE DATA CORP. |
| (Exact name of registrant as specified in its charter) |
| Nevada | 00-0000000 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
2033 Gateway Place, 5th Floor, San Jose, California | 95110 |
| (Address of principal executive offices) | (Zip Code) |
206-338-2649 (Registrant’s telephone number, including area code) |
n/a (Former name, former address and former fiscal year, if changed since last report) |
Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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.
[ 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 the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company in Rule 12b-2 of the Exchange Act.
Larger accelerated filer [ ] &# 160; Accelerated filer [ ]
Non-accelerated filer [ ] (Do not check if a smaller reporting company) 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).
[ X ] Yes [ ] No
APPLICABLE ONLY 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.
Class | Outstanding at June 14, 2010 |
| common stock - $0.001 par value | 23,940,900 |
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements.
MOBILE DATA CORP.
(An Exploration Stage Company)
FINANCIAL STATEMENTS
(Unaudited)
APRIL 30, 2010
| Table of Contents: | Index |
| Balance Sheets | F-1 |
| Statements of Operations | F-2 |
| Statements of Cash Flows | F-3 |
| Notes to the Financial Statements | F-4 |
| | |
MOBILE DATA CORP.
(Formerly Endeavor Explorations Inc.)
(A Development Stage Company)
BALANCE SHEETS
(Unaudited)
| | | | | | |
| | | | | | |
| | April 30, | | | July 31, | |
| | 2010 | | | 2009 | |
| | |
| ASSETS | |
| | | | | | |
| Current | | | | | |
| Cash | $ | 1,344 | | | $ | 1,665 | |
| Prepaid expenses | | 3,740 | | | | 4,020 | |
| | | 5,084 | | | | 5,685 | |
| Intellectual property (Note 2) | | 77,000 | | | | - | |
| | $ | 82,084 | | | $ | 5,685 | |
| | | | | | | | |
| | |
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | |
| | |
| Current | | | | | | | |
| Accounts payable and accrual liabilities | $ | 41,110 | | | $ | 24,751 | |
| Promissory notes payable (Note 3) | | 243,500 | | | | 178,541 | |
| Due to related parties | | 13,321 | | | | 7,340 | |
| | | 297,931 | | | | 210,632 | |
| | | | | | | | |
| STOCKHOLDERS’ DEFICIT | |
| Common stock (Note 4) | | | | | | | |
| Authorized: | | | | | | | |
| 75,000,000 common shares, $0.001 par value | | | | | | | |
| Issued and outstanding: | | | | | | | |
| 23,940,900 common shares (July 31, 2009 – 21,040,000) | | 23,941 | | | | 21,040 | |
| Additional paid-in capital | | 273,243 | | | | 149,513 | |
| Deficit accumulated during the development stage | | (513,031 | ) | | | (375,500 | ) |
| | | (215,847 | ) | | | (204,947 | ) |
| | | | | | | | |
| | $ | 82,084 | | | $ | 5,685 | |
| | | | | | | | |
| Subsequent Event (Note 5) | | | | | | | |
| | | | | | | | |
The accompanying notes are an integral part of these interim financial statements.
MOBILE DATA CORP.
(Formerly Endeavor Explorations Inc.)
(A Development Stage Company)
STATEMENTS OF OPERATIONS
(Unaudited)
| | | | |
| | | | | | Cumulative |
| | Three | Three | | | from |
| | months | months | Nine months | Nine months | July 13. 2005 |
| | ended | ended | ended | ended | (Inception to) |
| | April 30, | April 30, | April 30, | April 30, | April 30, |
| | 2010 | 2009 | 2010 | 2009 | 2010 |
| | | | | | |
| Expenses | | | | | |
| Development costs (Note 2) | $ 7,366 | $ - | $ 43,366 | $ - | $ 43,366 |
| Finance charges (Note 3) | 5,455 | 4,256 | 36,143 | 97,585 | 237,773 |
| Mineral property cost | - | - | 391 | 24,731 | 45,358 |
| Office and administration expenses | 11,275 | 16,248 | 57,631 | 7,359 | 186,534 |
| | | | | | |
| Net loss | $ (24,096) | $ (20,504) | $ (137,531) | $ (129,675) | $ (513,031) |
| | | | | | |
| Net loss per share – basic and | | | | |
| diluted | $ (0.00) | $ (0.00) | $ (0.00) | $ (0.00) | |
| | | | | | |
| Weighted average number of | | | | | |
| shares outstanding – basic and | | | | | |
| diluted | 23,940,900 | 31,040,000 | 22,856,288 | 31,040,000 | |
| | | | | | |
| | | | | | |
The accompanying notes are an integral part of these interim financial statements.
MOBILE DATA CORP.
(Formerly Endeavor Explorations Inc.)
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)
| | | | | | | | Cumulative from | |
| | Nine months ended April 30, | | | Nine months ended April 30, | | | July 13, 2005 (Inception) to April 30, | |
| | 2010 | | | 2009 | | | 2010 | |
| | | | | | | | | |
| Cash Flow From Operating Activities | | | | | | | | |
| Net loss | $ | (137,531 | ) | | $ | (129,675 | ) | | $ | (513,031 | ) |
| Non-cash items: | | | | | | | | | | | |
| Foreign exchange | | (53 | ) | | | (22,714 | ) | | | (8,488 | ) |
| Finance charges | | 36,143 | | | | 97,543 | | | | 237,772 | |
| Non-cash working capital items: | | | | | | | | | | | |
| Prepaid expenses | | 280 | | | | (5,761 | ) | | | (3,740 | ) |
| Accounts payable and accrual liabilities | | 16,359 | | | | (9,059 | ) | | | 41,110 | |
| Net cash used in operations | | (84,802 | ) | | | (69,666 | ) | | | (246,376 | ) |
| | | | | | | | | | | | |
| Cash Flow From Investing Activities | | | | | | | | | | | |
| Acquisition of intellectual property | | (5,000 | ) | | | - | | | | (5,000 | ) |
| Acquisition of mineral property | | - | | | | - | | | | (288,824 | ) |
| Net cash used in investing activities | | (5,000 | ) | | | - | | | | (293,824 | ) |
| | | | | | | | | | | | |
| Cash Flow From Financing Activities | | | | | | | | | | | |
| Advances from related party | | 5,981 | | | | 4,171 | | | | 13,321 | |
| Long term debt (net) | | - | | | | (29,620 | ) | | | 218,915 | |
| Issuance of capital stock | | - | | | | - | | | | 46,800 | |
| Repurchase shares for cancellation | | - | | | | - | | | | (1 | ) |
| Proceeds from promissory notes payable | | 83,500 | | | | 85,000 | | | | 262,509 | |
| Net cash provided by financing activities | | 89,481 | | | | 59,551 | | | | 541,544 | |
| | | | | | | | | | | | |
| Increase (Decrease) in cash | | (321 | ) | | | (10,115 | ) | | | 1,344 | |
| | | | | | | | | | | | |
| Cash, beginning | | 1,665 | | | | 11,072 | | | | - | |
| | | | | | | | | | | | |
| Cash, ending | $ | 1,344 | | | $ | 957 | | | $ | 1,344 | |
| | | | | | | | | | | | |
| Supplemental cash flow information | | | | | | | | | | | |
| Cash paid for: | | | | | | | | | | | |
| Interest | $ | - | | | $ | - | | | $ | - | |
| Income taxes | $ | - | | | $ | - | | | $ | - | |
| | | | | | | | | | | | |
| Non-cash items: | | | | | | | | | | | |
| Shares issued for mineral property | $ | - | | | $ | - | | | $ | 7,000,000 | |
| Shares issued for convertible debt | $ | 18,488 | | | $ | - | | | $ | 18,488 | |
| Shares issued for purchase of intellectual property assets | $ | 72,000 | | | $ | - | | | $ | 72,000 | |
The accompanying notes are an integral part of these interim financial statements.
MOBILE DATA CORP.
(Formerly Endeavor Explorations Inc.)
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
April 30, 2010
| | Unaudited Interim Financial Statements |
Effective January 6, 2010, the Company changed its name to Mobile Data Corp.
The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and in accordance with the rules and regulations of the Securities and Exchange Commission. They may not include all information and footnotes required by generally accepted accounting principles for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the year ended July 31, 2009, included in the Company’s Form 10-K filed with the Securities and Exchange Commission. The unaudited interim financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of Management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the nine months ended April 30, 2010 are not necessarily indicative of the results that may be expected for the year ending July 31, 2010.
On October 27, 2009, the Company entered into an Asset Purchase Agreement with Spidex Technologies (“Spidex”) to acquire the following intellectual property assets from Spidex:
| a) | MDC GPS Trademark for mobile data technology, which is a software application that can run on GPS enabled Smartphones; |
| b) | Domain Names: MOBILEDATACORP.COM; and |
| c) | Proprietary Code, which is an experimental Java source code that can send GPS data to a server. |
The purchase price consists of a payment of $5,000 and the issuance of 1,000,000 shares of the Company with a fair value of $72,000 (Note 4). The Company incurred legal expenses of $10,000 relating to this acquisition which was expensed during the nine months ended April 30, 2010.
The Company retained Spidex to provide services to further develop and commercialize the purchased assets for $12,000 per month for a period of one year starting from October 27, 2009. For the nine months ended April 30, 2010, $36,000 has been paid to Spidex and recorded as development costs. As of April 8, 2010, the Company cancelled the services with Spidex. In terms of the Asset Purchase Agreement, the Company is obligated to issue Spidex a license to utilize the intellectual property in the event the Company terminates the service agreement. The terms of the license agreement is to be negotiated between the Company and Spidex. To June 14, 2010, the license agreement terms has not been negotiated and the Company has not granted Spidex the license.
MOBILE DATA CORP.
(Formerly Endeavor Explorations Inc.)
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
April 30, 2010
| 3. | CONVERTIBLE PROMISORY NOTES PAYABLE |
| Balance at July 31, 2009 | | $ 178,541 |
| October 8, 2009 convertible note issued | | 28,500 |
| November 19, 2009 convertible note issued | | 20,000 |
| December 10, 2009 convertible note issued | | 15,000 |
| November 19, 2009 converted to shares | | (4,600) |
| November 19, 2009 converted to shares | | (13,888) |
| March 1, 2010 convertible note issued | | 20,000 |
| | | 243,553 |
| Adjust for translation gain | | (53) |
| Balance April 30, 2010 | | $ 243,500 |
During the nine months ended April 30, 2010, the Company issued convertible promissory notes with a principal amount of $83,500. The notes are unsecured, payable on demand and do not bear any interest. Of the $83,500, $28,500 can be converted to one share of the Company for each $0.08 outstanding in principal, $20,000 can be converted to one share of the Company for each $0.11 outstanding in principal and the remainder of the $83,500 can be converted to one share of the Company for each $0.05 outstanding in principal. At conversion, the maximum number of shares that will be issued is 1,238,068. The beneficial conversion feature of $36,143 was expensed as finance charges during the nine months ended April 30, 2010.
On December 16, 2009, the Company issued new convertible promissory notes in respect of its indebtedness to the lenders for the amounts of $141,000 and $82,500 to replace the promissory notes issued previously. The notes are unsecured, payable on demand and do not bear any interest. The notes, or any part thereof, can be converted to one share of the Company for each $0.05 outstanding. At conversion, the maximum number of shares that will be issued is 4,470,000. The beneficial conversion feature for this issuance was $166,800, which was less than the beneficial conversion feature recognized in prior years. Therefore, there was no additional beneficial conversion feature related to this issuance.
| | On November 19, 2009, the Company issued 1,900,900 shares in settlement of convertible promissory notes issued to the Company’s president for amounts of US$4,600 issued on August 17, 2007 and US$13,888 (CDN$15,000) issued on December 14, 2007. |
MOBILE DATA CORP.
(Formerly Endeavor Explorations Inc.)
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
April 30, 2010
| | On October 27, 2009, the Company issued 1,000,000 of its common shares for purchase of the intellectual property assets from Spidex (Note 2). |
| | On November 19, 2009, the Company issued 1,900,900 shares in settlement of convertible promissory notes issued to the Company’s president for amounts of US$4,600 issued on August 17, 2007 and US$13,888 (CDN$15,000) issued on December 14, 2007. |
| | On May 4, 2010, the Company issued a convertible promissory note in the amount of $10,000. The note is unsecured, payable on demand and does not bear any interest. |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation.
THE FOLLOWING PRESENTATION OF MANAGEMENT’S DISCUSSION AND ANALYSIS OF MOBILE DATA CORP. SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION INCLUDED HEREIN.
Overview
During part of the fiscal period ended October 31, 2009, Mobile was a startup exploration stage company without operations. Subsequently, management decided to expand Mobile’s focus and identify and assess new projects for acquisition purposes that are more global in nature and technology-based.
MDC GPS Technology
During the fiscal period ended October 31, 2009, management decided to expand Mobile’s focus and identify and assess new projects for acquisition purposes that are more global in nature and technology-based. In September 2009, Mobile entered into a letter of intent with Spidex Technologies (the “Letter of Intent”) for the acquisition of all of the right, title and interest in a mobile data technology for Smartphones (the “Technology”) that can run on GPS enabled Smartphones. The Technology is a software application that will run in the background and will collect and transmit location data to a server. Server applications will include location monitoring of vehicles, children and members of social networking groups. See Exhibit 10.3 – Letter of Intent for more details.
After conducting its due diligence on the Technology, Mobile entered into an asset purchase agreement in October 2009 with Spidex Technologies for the acquisition of all of the right, title and interest in the Technology. As consideration for the acquisition of the Technology, Mobile paid Spidex $5,000 on the signing of the Letter of Intent and issued 1 million restricted shares to Spidex at a deemed price of $0.10 per share.
Also, Spidex agreed to assist Mobile in the further development and commercialization of the Technology. Mobile agreed to retain Spidex for a period of 12 months and to pay Spidex a monthly consulting fee to provide services to Mobile for the purpose of developing and advancing the Technology to a point where it can be sold commercially. Either party may terminate these services upon 30 days’ notice. Mobile retained Spidex to provide services to further develop and commercialize the purchased assets for $12,000 per month for a period of one year starting from October 27, 2009. For the nine months ended April 30, 2010, $36,000 has been paid to Spidex and recorded as development costs. As of April 8, 2010, Mobile cancelled the services with Spidex. In terms of the Asset Purchase Agreement, Mobile is obligated to issue Spidex a license to utilize the intellectual property in the event Mobile terminates the service agreement. The terms of the license agreement is to be negotiated between Mobile and Spidex. To June 14, 2010, the license agreement terms have not been negotiated and the Company has not granted Spidex the license.
Mobile plans to target BlackBerry devices initially but intends to broaden support to other GPS enabled smartphones including the Apple iPhone, Google Andriod devices and possibly Palm Pre and Motorola iDen devices.
Martin Lake Claims
On January 18, 2008, Mobile Data Corp. acquired eight mineral claims located in the Uranium City area of Northern Saskatchewan known as the Martin Lake Properties (the “Martin Lake Claims”). The Martin Lake Claims covered approximately 1,500 hectares (3,700 acres). However, on July 21, 2009, the board of directors approved management’s recommendation to abandon the Martin Lake Claims. Management recommended abandoning the Martin Lake Claims in view of the current economic downturn and it was determined that the Martin Lake Claims no longer warranted further exploration or development based on the results of exploration Mobile has conducted on the Martin Lake Claims. Pursuant to the terms and conditions of the Mining Property Purchase Agreement, Mobile sent notice on August 4, 2009 to Mr. Dubnick of its intention to abandon the Martin Lake Claims. As a result of the abandonment of the Martin Lake Claims 60 days prior to any deadline for additional assessment work to be completed, Mobile has no further obligations under the Mining Property Purchase Agreement. See Exhibit 10.2 – Mining Property Purchase Agreement for more details.
Plan of Operation
Mobile has not had any significant revenues generated from its business operations since inception. Mobile expects that the revenues generated from its business for the next 12 months will not be enough for its required working capital. Until Mobile is able to generate any consistent and significant revenue it may be required to raise additional funds by way of equity or debt financing.
At any phase, if Mobile finds that it does not have adequate funds to complete a phase, it may have to suspend its operations and attempt to raise more money so it can proceed with its business operations. If Mobile cannot raise the capital to proceed it may have to suspend operations until it has sufficient capital. Mobile expects to raise the required funds for the next 12 months with equity or debt financing.
To become profitable and competitive, Mobile needs to develop and advance the Technology to a point where it can be sold commercially. To achieve this goal, management has prepared the following phases for its plan of operation for the next 12 months.
Phase 1 - Develop the Technology (9 months)
Mobile has developed the first client software for BlackBerry GPS enabled smartphone Storm 2 9550, developed server software which can receive data from the BlackBerry GPS enabled smartphone Storm 2 9550, and developed a server based web application to provide a location based service. Mobile has spent approximately $50,000 for this phase and expects the client software to be available for all BlackBerry based smartphones in the next quarter.
Phase 2 - Implement marketing strategy (3 months)
In Phase 2, Mobile plans to (1) hire personnel for sales, marketing and customer service, (2) create a marketing strategy for the Technology and its products, and (3) implement its marketing strategy on its target market.
Mobile has budgeted approximately $250,000 for this phase and expects it to take three months to complete with completion expected within the final three months of Mobile’s plan of operation.
Risk Factors
An investment in Mobile’s common stock involves a number of very significant risks. Prospective investors should refer to all the risk factors disclosed in Mobile’s Form SB-2 filed on April 4, 2007 and Mobile’s Form 10-K filed on November 3, 2008, and Mobile’s Form 10-K filed on November 2, 2009.
Financial Condition
As at April 30, 2010, Mobile had a cash balance of $1,344. Management does not anticipate generating any revenue for the foreseeable future. When additional funds become required, the additional funding will come from equity financing from the sale of Mobile’s common stock or sale of its GPS application software products. If Mobile is successful in completing an equity financing, existing shareholders will experience dilution of their interest in Mobile. Mobile does not have any financing arranged and Mobile cannot provide investors with any assurance that Mobile will be able to raise sufficient funding from the sale of its common stock. In the absence of such financing, Mobile’s business will fail.
Based on the nature of Mobile’s business, management anticipates incurring operating losses in the foreseeable future. Management bases this expectation, in part, on the fact that very few technology companies in the development stage ultimately develop, market, and successfully sell their products. Mobile’s future financial results are also uncertain due to a number of factors, some of which are outside its control. These factors include, but are not limited to:
| · | Mobile’s ability to raise additional funding; |
| · | the competitive market for similar technology and the pricing of such technology; |
| · | the results of Mobile’s proposed research and development on its Technology; and |
| · | Mobile’s ability to find joint venture partners for the development of its Technology |
Due to Mobile’s lack of operating history and present inability to generate revenues, Mobile’s auditors have stated their opinion that there currently exists a substantial doubt about Mobile’s ability to continue as a going concern
Liquidity
Mobile’s internal sources of liquidity will be loans that may be available to Mobile from management. Management has previously loaned Mobile donated services and rent. Though Mobile has no written arrangements with any of its directors or officers, Mobile expects that the directors or officers will provide Mobile with internal sources of liquidity, if it is required.
Also, Mobile’s external sources of liquidity will be private placements for equity conducted outside the United States. During the quarter covered by this quarterly report, Mobile did not complete any definitive arrangements for any external sources of liquidity.
Capital Resources
As of April 30, 2010, Mobile had total assets of $82,084, consisting of $1,344 in cash, $3,740 in prepaid expenses, and $77,000 in intellectual property, and total current liabilities of $297,931 for a net working capital of $(292,847), compared with a net working capital of ($204,947) as of July 31, 2009. The liabilities consisted of $41,110 in accounts payable and accrual liabilities, $243,500 in promissory notes payable, and $13,321 due to related parties.
There are no assurances that Mobile will be able to achieve further sales of its common stock or any other form of additional financing. If Mobile is unable to achieve the financing necessary to continue its plan of operations, then Mobile will not be able to continue its exploration programs and its business will fail.
Net Cash Used in Operating Activities
For the nine month period ended April 30, 2010, net cash used in operating activities increased to $84,802 compared with $69,666 for the same nine month period in the previous fiscal year.
At April 30, 2010, Mobile had cash of $1,344. During the nine month period ended April 30, 2010, Mobile used $84,802 in cash for operating activities. This was primarily a result of non-cash items of $(53) in foreign exchange and $36,143 in finance charges and the non-cash working capital items of $280 in prepaid expenses and $16,359 in accounts payable and accrual liabilities.
Net Cash Used in Investing Activities
Net cash used by investing activities was $5,000 for the nine month period ended April 30, 2010, for the acquisition of the intellectual property, as compared with $nil used for the same nine month period in the previous fiscal year.
Net Cash Provided By Financing Activities
Net cash flows provided by financing activities increased to $89,481 for the nine month period ended April 30, 2010 as compared with financing activities of $59,551 for the same nine month period in the previous fiscal year, primarily as a result of advances from a related party in the amount of $5,981 and no additional long term debt incurred as compared to $29,620 for the same nine month period in the previous fiscal year.
Results of Operation for the Period Ended April 30, 2010
Mobile has had no operating revenues since its inception on July 13, 2005, through to April 30, 2010. Mobile’s activities have been financed from the proceeds of share subscriptions and from proceeds from promissory notes. From its inception, on July 13, 2005, to April, 2010 Mobile has raised a total of $46,800 from private offerings of its common stock and a total of $262,509 from proceeds from promissory notes payable.
For the period from inception on July 13, 2005, to April 30, 2010, Mobile incurred total expenses of $513,031. These expenses included $43,366 in development costs, $237,773 in finance charges, $45,358 in mineral property costs, and $186,534 in office and other administration expenses.
For the nine month period ended April 30, 2010, Mobile incurred total expenses of $137,531. These expenses included $43,366 in development costs, $36,143 in finance charges, $391 in mineral property costs, and $57,631 in office and other administration expenses.
For the nine month period ended April 30, 2009, Mobile incurred total expenses of $129,675. These expenses included (1) $24,731 in mineral property costs; (2) $97,585 in finance charges; and (3) $7,359 for office and other administration expenses.
For the three months ending April 30, 2010 Mobile incurred total expenses of $24,096. These expenses included (1) development costs $7,366 (2) finance charges $5455 and office and administration expenses of $11,275.
Mobile has not attained profitable operations and is dependent upon obtaining financing to pursue future acquisitions. For these reasons, there is substantial doubt that Mobile will be able to continue as a going concern.
Off-balance Sheet Arrangements
Mobile has no off-balance sheet arrangements including arrangements that would affect its liquidity, capital resources, market risk support and credit risk support or other benefits.
Material Commitments for Capital Expenditures
Mobile had no contingencies or long-term commitments at April 30, 2010.
Tabular Disclosure of Contractual Obligations
Mobile is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.
Overview and Anticipated Expenses
Management anticipates spending approximately $250,000 on the research, development, and marketing of the Technology in the next 12 months. However, the amount to be spent on the Technology will depend on whether Mobile can develop the Technology to a point where it is marketable.
Management intends to continue to have Mobile’s outside consultant assist in the preparation of its quarterly and annual financial statements and have these financial statements reviewed or audited by its independent auditor. Mobile’s outside consultant is expected to charge Mobile approximately $1,250 to prepare its quarterly financial statements and approximately $1,750 to prepare its annual financial statements. Mobile’s independent auditor is expected to charge approximately $2,500 to review its quarterly financial statements and approximately $12,000 to audit its annual financial statements. In the next 12 months, management anticipates spending approximately $25,000 to pay for Mobile’s accounting and audit requirements.
Additionally, management expects to incur legal costs of approximately $4,000 per quarter to support three quarterly 10-Q filings and $5,000 to support one annual 10-K filing. In the next twelve months, management anticipates spending approximately $17,000 for legal costs to pay for three quarterly filings and one annual filing.
Forward Looking Statements
The information in this quarterly report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements involve risks and uncertainties, including statements regarding Mobile’s capital needs, business strategy and expectations. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential” or “continue”, the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined from time to time, in other reports Mobile files with the Securities and Exchange Commission. These factors may cause Mobile’s actual results to differ materially from any forward-looking statement. Mobile disclaims any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Mobile is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Management maintains “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in Mobile’s Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to management, including Mobile’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
In connection with the preparation of this quarterly report on Form 10-Q, an evaluation was carried out by management, with the participation of the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of Mobile’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of April 30, 2010.
Based on that evaluation, management concluded, as of the end of the period covered by this report, that Mobile’s disclosure controls and procedures were effective in recording, processing, summarizing, and reporting information required to be disclosed, within the time periods specified in the Securities and Exchange Commission’s rules and forms.
Changes in Internal Controls over Financial Reporting
As of the end of the period covered by this report, there have been no changes in Mobile’s internal controls over financial reporting during the quarter ended April 30, 2010, that materially affected, or are reasonably likely to materially affect, Mobile’s internal control over financial reporting subsequent to the date of management’s last evaluation.
PART II – OTHER INFORMATION
Item 1. Legal Proceedings.
Mobile is not a party to any pending legal proceedings and, to the best of Mobile’s knowledge, none of Mobile’s property or assets are the subject of any pending legal proceedings.
Item 1A. Risk Factors.
Mobile is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
During the quarter of the fiscal year covered by this report, (i) Mobile did not modify the instruments defining the rights of its shareholders, (ii) no rights of any shareholders were limited or qualified by any other class of securities, and (iii) Mobile did not sell any unregistered equity securities.
Item 3. Defaults Upon Senior Securities.
During the quarter of the fiscal year covered by this report, no material default has occurred with respect to any indebtedness of Mobile. Also, during this quarter, no material arrearage in the payment of dividends has occurred.
Item 4. (Removed and Reserved).
Item 5. Other Information.
During the quarter of the fiscal year covered by this report, Mobile reported all information that was required to be disclosed in a report on Form 8-K.
Mobile has adopted a new code of ethics that applies to all its executive officers and employees, including its CEO and CFO. See Exhibit 14 – Code of Ethics for more information. Mobile undertakes to provide any person with a copy of its financial code of ethics free of charge. Please contact Mobile at info@Mobileexplorations.com to request a copy of Mobile’s code of ethics. Management believes Mobile’s code of ethics is reasonably designed to deter wrongdoing and promote honest and ethical conduct; provide full, fair, accurate, timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of code violations; and provide accountability for adherence to the code.
Item 6. Exhibits
| (a) | Index to and Description of Exhibits |
All Exhibits required to be filed with the Form 10-Q are included in this quarterly report or incorporated by reference to Mobile’s previous filings with the SEC, which can be found in their entirety at the SEC website at www.sec.gov under SEC File Number 000-52958 and SEC File Number 333-140779.
| Exhibit | Description | Status |
| 3.1 | Articles of Incorporation of Mobile Data Corp., filed as an Exhibit to Mobile’s Form SB-2 (Registration Statement) on February 16, 2007, and incorporated herein by reference. | Filed |
| 3.2 | Bylaws of Mobile Data Corp., filed as an Exhibit to Mobile’s Form SB-2 (Registration Statement) on February 16, 2007, and incorporated herein by reference. | Filed |
| 3.3 | Certificate of Amendment dated January 6, 2010, filed as an Exhibit to Mobile’s Form 8K (Current Report) on January 12, 2010, and incorporated herein by reference. | Filed |
| 10.1 | Mineral Property Purchase Agreement dated July 28, 2006 between Ainslie Corrigan and Mobile Data Corp., filed as an Exhibit to Mobile’s Form SB-2 (Registration Statement) on February 16, 2007, and incorporated herein by reference. | Filed |
| 10.2 | Mineral Property Purchase Agreement dated January 18, 2008 between Rod Dubnick and Mobile Data Corp., filed as an Exhibit to Mobile’s Form 8-K (Current Report) on January 24, 2008, and incorporated herein by reference. | Filed |
| 10.3 | Letter of Intent dated September 29, 2009 between Spidex Technologies and Mobile Data Corp., filed as an Exhibit to Mobile’s Form 8-K (Current Report) on October 2, 2009, and incorporated herein by reference. | Filed |
| 10.4 | Asset Purchase Agreement dated October 27, 2009 between Mobile Data Corp. and Spidex Technologies, filed as an Exhibit to Mobile’s Form10-K (Annual Report) on November 2, 2009, and incorporated herein by reference. | Filed |
| 10.5 | Promissory Note dated December 16, 2009 given to Blue Cove Holdings Inc. by Endeavor Explorations Inc., filed as an Exhibit to Mobile’s Form 8K (Current Report) on December 22, 2009, and incorporated herein by reference. | Filed |
| 10.6 | Promissory Note dated December 16, 2009 given to Tiger Ventures Group, Ltd. by Endeavor Explorations Inc., filed as an Exhibit to Mobile’s Form 8K (Current Report) on December 22, 2009, and incorporated herein by reference. | Filed |
| 14 | Code of Ethics, filed as an Exhibit to Mobile’s Form 10-Q (Quarterly Report) on March 17, 2008, and incorporated herein by reference. | Filed |
| 31 | Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | Included |
| 32 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | Included |
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, Mobile Data Corp. has caused this report to be signed on its behalf by the undersigned duly authorized person.
MOBILE DATA CORP.
Dated: June 14, 2010 By:/s/ Steven Cozine
Name: Steven Cozine
Title: Director and CEO
(Principal Executive Officer)
Dated: June 14, 2010 By:/s/ Belkis Jimenez Rivero
Name: Belkis Jimenez Rivero
Title: Director and CFO
(Principal Financial Officer)
Exhibit 31
MOBILE DATA CORP.
CERTIFICATIONS PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
CERTIFICATION
I, Steven Cozine, certify that:
1. I have reviewed this quarterly report on Form 10-Q for the quarter ending April 30, 2010 of Mobile Data Corp.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: June 14, 2010
/s/ Steven Cozine
Steven Cozine
Chief Executive Officer
MOBILE DATA CORP.
CERTIFICATIONS PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
CERTIFICATION
I, Belkis Jimenez Rivero, certify that:
1. I have reviewed this quarterly report on Form 10-Q for the quarter ending April 30, 2010 of Mobile Data Corp.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: June 14, 2010
/s/ Belkis Jimenez Rivero
Belkis Jimenez River
Chief Financial Officer
Exhibit 32
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Mobile Data Corp. (the “Company”) on Form 10-Q for the period ending April 30, 2010 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Steven Cozine, President, Chief Executive Officer of the Company and a member of the Board of Directors, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
| | (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| | (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Steven Cozine
Steven Cozine
Chief Executive Officer
June 14, 2010
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Mobile Data Corp. (the “Company”) on Form 10-Q for the period ending April 30, 2010 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Belkis Jimenez Rivero, Chief Financial Officer of the Company and a member of the Board of Directors, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
| | (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| | (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Belkis Jimenez Rivero
Belkis Jimenez Rivero
Chief Financial Officer
June 14, 2010
