SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
(Mark One)
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Fiscal Year Ended December 31, 2008
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File No. 000-52828
DIGITAL DEVELOPMENT PARTNERS, INC.
-------------- -----------------------------------
(Exact name of registrant as specified in its charter)
Nevada 98-0521119
-------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
58 1/2 North Lexington Ave.
Asheville, North Carolina 28801
-------------------------------------- --------
(Address of Principal Executive Office) Zip Code
Registrant's telephone number, including Area Code: (828) 225-8124
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock
Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. [ ]
Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act. [ ]
Indicate by check mark whether the registrant (1) has filed all reports to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
(Do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Act): [ ] Yes [x] No
The aggregate market value of the voting stock held by non-affiliates of the
Company on June 30, 2008 was -0-.
As of December 31, 2009, the Company had 26,902,000 issued and outstanding
shares of common stock.
Documents incorporated by reference: None
ITEM 1. BUSINESS
--------
The Company was incorporated in Nevada December 2006. During the period
from its incorporation through December 31, 2008 the Company did not generate
any revenue and incurred $6,650 in exploration expenses and $16,603 in operating
and general administration expenses.
In January 2007 the Company leased ten mining claims from an unrelated
third party. These claims were located in Piute County, Utah. The mining lease
was for a twenty-year term and required the Company to pay a royalty to the
lessor equal to 2.5% of the net smelter returns from the sale of any minerals
extracted from the claims. Minimum royalty payments of $4,500 were also required
each year during the term of the lease. On November 1, 2008 the mining lease was
terminated by the mutual agreement of the Company and the lessor.
On May 19, 2009 the Company's sole director:
o in accordance with Section 78.207 of the Nevada Revised Statutes,
approved a resolution approving a 3-for-1 forward stock split and
increasing the Company's authorized capitalization to 225,000,000
shares of common stock; and
o in accordance with Section 92A.180 of the Nevada revised statutes,
approved a resolution changing the Company's name to Digital
Development Partners, Inc.
Prior to May 19, 2009 the Company had an authorized capitalization of
75,000,000 shares of common stock and had 3,625,000 outstanding shares of common
stock. Following the forward split, the Company had 10,875,000 outstanding
shares of common stock.
The forward stock split and the name change became effective on the OTC
Bulleting Board on June 29, 2009.
On August 3, 2009 the Company acquired all of the outstanding shares of
4gDeals, Inc. for 15,495,000 shares of the Company's common stock.
In connection with the acquisition:
o Jeffrey Collins resigned as the Company's sole officer and director;
o Isaac Roberts was appointed the Company's President and as a director;
o Ravikumar Nandagopalan was appointed the Company's Secretary and
Treasurer and as a director;
o Jeffrey Collins sold 4,500,000 shares of the Company's common stock to
Isaac Roberts for a nominal price; and
o the Company issued Mr. Collins a warrant which allows Mr. Collins to
acquire up to 2,000,000 shares of the Company's common stock at a
price of $1.00 per share at any time prior to June 1, 2014. Mr.
Collins has since transferred these warrants to persons not affiliated
with the Company.
2
The Company, through its subsidiary 4gDeals, is developing a
software-based system which will allow restaurants, merchants and service
providers to send electronic coupons ("e-coupons") to mobile communication
devices and personal computers of customers advising the customer of discounts
or other promotional offers. The e-coupon will normally contain a promotion code
which, when provided to the establishment, will enable the customer to obtain
the discount or promotional offer. Establishments using this system will be able
to notify customers rapidly of discount offers and will avoid the time and cost
of publishing discount offers in newspapers or other traditional forms of media.
For example:
o a restaurant, sensing a slower than normal Thursday, could use the
Company's system to quickly send an e-coupon which could be redeemed
that evening only for discounted dinners;
o a hardware store, could, when learning of a forecasted snow storm,
send out e-coupon for discounts on snow shovels and ice scrapers; or
o a movie theater, after seeing a star in a newly released motion
picture being interviewed on a morning news program, could send
e-coupons offering discounts on an evening showing.
The estimated cost of completing the development and bringing the
Company's system on-line is approximately $765,000. During that time period, the
Company estimates that it will require approximately $240,000 for marketing and
administrative costs.
The Company estimates that approximately 1,000 merchants and 30,000
customers will be needed before the Company will be profitable.
Depending on the availability of capital, the Company expects that the
first version of its system will be completed by March 1, 2010.
As a result of the acquisition of 4gDeals, Inc. the Company is no longer a
shell corporation.
Between September 30 and November 4, 2009 the Company sold 216,000 Units
to private investors at a price of $0.75 per Unit. Each Unit consisted of one
share of the Company's common stock, one Series A Warrant and one Series B
Warrant. Each Series A Warrant entitles the holder to purchase one share of the
Company's common stock at a price of $1.00 per share. Each Series B Warrant
entitles the holder to purchase one share of the Company's common stock at a
price of $1.25 per share. The Series A and B Warrants expire on September 30,
2014.
In December 2009 the Company entered into an option to acquire TopFloor
Studio Ltd. As consideration for the option, the Company issued 100,000 shares
of its common stock to the sole shareholder of TopFloor Studio. TopFloor Studio
is involved with the design and development of a social media website.
3
The Company is in the development stage and has not generated any revenue.
The Company needs additional capital to complete the development of its system
and to fund its operating losses. The Company will attempt to raise capital
through the private sale of its common stock or other securities.
General
- -------
As of December 31, 2009 the Company had four full time employees.
The Company's website address is: www.digitaldevelopmentpartners.com
ITEM 2. DESCRIPTION OF PROPERTY
-----------------------
See Item 1 of this report.
ITEM 3. LEGAL PROCEEDINGS.
-----------------
The Company is not involved in any legal proceedings and the Company does
not know of any legal proceedings which are threatened or contemplated.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
----------------------------------------------------
Not Applicable.
ITEM 5. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
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OTHER SHAREHOLDER MATTERS.
--------------------------
Between November 7, 2007 and June 29, 2009 the Company's common stock was
quoted on the OTC Bulletin Board under the symbol "CYIM". On June 29, 2009, and
in connection with the Company's name change, the Company's trading symbol was
changed to "DGDM". During the year ended December 31, 2008 the Company's common
stock did not trade.
Trades of The Company's common stock, should a market ever develop, will
be subject to Rule 15g-9 of the Securities Exchange Act of 1934, which rule
imposes certain requirements on broker/dealers who sell securities subject to
the rule to persons other than established customers and accredited investors.
For transactions covered by the rule, brokers/dealers must make a special
suitability determination for purchasers of the securities and receive the
purchaser's written agreement to the transaction prior to sale. The Securities
and Exchange Commission also has rules that regulate broker/dealer practices in
connection with transactions in "penny stocks". Penny stocks generally are
equity securities with a price of less than $5.00 (other than securities
registered on certain national securities exchanges or quoted on the NASDAQ
system, provided that current price and volume information with respect to
transactions in that security is provided by the exchange or system). The penny
stock rules require a broker/ dealer, prior to a transaction in a penny stock
not otherwise exempt from the rules, to deliver a standardized risk disclosure
document prepared by the Commission that provides information about penny stocks
and the nature and level of risks in the penny stock market. The broker/dealer
4
also must provide the customer with current bid and offer quotations for the
penny stock, the compensation of the broker/dealer and its salesperson in the
transaction, and monthly account statements showing the market value of each
penny stock held in the customer's account. The bid and offer quotations, and
the broker/dealer and salesperson compensation information, must be given to the
customer orally or in writing prior to effecting the transaction and must be
given to the customer in writing before or with the customer's confirmation.
These disclosure requirements may have the effect of reducing the level of
trading activity in the secondary market for The Company's common stock.
As of December 31, 2009 the Company had 26,902,000 outstanding shares of
common stock and 40 shareholders.
Holders of common stock are entitled to receive dividends as may be
declared by the Board of Directors. The Company's Board of Directors is not
restricted from paying any dividends but is not obligated to declare a dividend.
No dividends have ever been declared and it is not anticipated that dividends
will ever be paid.
During the year ended December 31, 2008 the Company did not purchase any
shares of its common stock from third parties in a private transaction or as a
result of any purchases in the open market. None of the Company's officers or
directors, nor any of its principal shareholders purchased any shares of its
common stock from third parties in a private transaction or as a result of
purchases in the open market during the year ended December 31, 2008.
ITEM 6. SELECTED FINANCIAL DATA
-----------------------
Not applicable.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND PLAN OF
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OPERATION
---------
The Company was incorporated in December 2006. During the period from its
incorporation through December 31, 2008 the Company did not generate any revenue
and incurred $6,650 in exploration expenses and $16,603 in operating and general
administration expenses.
Since its inception, the Company has financed its operations through the
private sale of its common stock. The Company does not have any commitments or
arrangements from any person to provide the Company with any additional capital.
See Item 1 of this report for information concerning the Company's plan of
operation.
See Note 2 to the financial statements included as part of this report for
a description of the Company's accounting policies and recent accounting
pronouncements.
5
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
---------------------------------------------------------
Not applicable.
ITEM 8. FINANCIAL STATEMENTS
--------------------
See the financial statements attached to this report.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.
---------------------------------------------
Not applicable.
ITEM 9A. CONTROLS AND PROCEDURES
-----------------------
The Company maintains a system of controls and procedures designed to
ensure that information required to be disclosed in reports filed or submitted
under the Securities Exchange Act of 1934, as amended ("1934 Act"), is recorded,
processed, summarized and reported, within time periods specified in the SEC's
rules and forms and to ensure that information required to be disclosed by the
Company in the reports that it files or submits under the 1934 Act, is
accumulated and communicated to the Company's management, including its
Principal Executive and Financial Officer, as appropriate to allow timely
decisions regarding required disclosure. As of December 31, 2009, the Company's
Principal Executive and Financial Officer evaluated the effectiveness of the
design and operation of the Company's disclosure controls and procedures. Based
on that evaluation, the Company's Principal Executive and Financial Officer
concluded that the Company's disclosure controls and procedures were effective.
Management's Report on Internal Control Over Financial Reporting
The Company's management is responsible for establishing and maintaining
adequate internal control over financial reporting and for the assessment of the
effectiveness of internal control over financial reporting. As defined by the
Securities and Exchange Commission, internal control over financial reporting is
a process designed by, or under the supervision of the Company's principal
executive officer and principal financial officer and implemented by the
Company's Board of Directors, management and other personnel, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of the Company's financial statements in accordance with U.S.
generally accepted accounting principles.
Because of its inherent limitations, internal control over financial
reporting may not prevent or detect misstatements. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the
degree of compliance with the policies or procedures may deteriorate.
The Company's management evaluated the effectiveness of its internal
control over financial reporting as of December 31, 2008 based on criteria
established in Internal Control - Integrated Framework issued by the Committee
of Sponsoring Organizations of the Treadway Commission, or the COSO Framework.
Management's assessment included an evaluation of the design of the Company's
6
internal control over financial reporting and testing of the operational
effectiveness of those controls.
Based on this evaluation, the Company's management concluded that the
Company's internal control over financial reporting was effective as of December
31, 2008.
There was no change in the Company's internal control over financial
reporting that occurred during the quarter ended December 31, 2008 that has
materially affected, or is reasonably likely to materially affect, the Company's
internal control over financial reporting.
Management's report was not subject to attestation by the Company's
independent registered public accounting firm pursuant to temporary rules of the
SEC that permit the Company to provide only management's report on internal
control in this report.
ITEM 9B. OTHER INFORMATION
-----------------
Not applicable.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
-------------------------------------------------------------
Name Age Position
---- --- --------
Issac Roberts 28 President, Principal Financial Officer,
Principal Accounting Officer and a Director.
Ravikumar Nandagopalan 44 Secretary, Treasurer and a Director.
James R. McMahon 42 Director and Chief Operating Officer of the
Company's wholly owned subsidiary, Yu Deal Inc.
(formerly named 4gDeals, Inc.).
The directors of the Company serve in such capacity until the annual
meeting of the Company's shareholders and until their successors have been duly
elected and qualified. The officers of the Company serve at the discretion of
the Company's directors.
The principal occupation of the Company's officers and directors during
the past several years is as follows:
Isaac Roberts became an officer and director of the Company on August 3,
2009. Mr. Roberts has been an officer and director of 4gDeals since 2007. Since
February 2008 Mr. Roberts has also been a field service technician with
Ashland/Hercules Chemical Co. In this capacity, Mr. Roberts performs various
tests and other procedures which are designed to maximize the efficiency of a
paper mill serviced by Ashland/Hercules in Canton, North Carolina. Between
November 2004 and July 2006 Mr. Roberts was a field service technician with
Systems Integration and Management. In this capacity Mr. Roberts maintained and
7
repaired security equipment used by the U.S. Department of Agriculture in
Washington D.C. Between September 2000 and April 2004 Mr. Roberts was enlisted
in the United States Navy. In September 2008 Mr. Roberts founded, and since that
date has been the Chief Executive Officer of a development stage, service based,
biotechnology firm which provides consulting services to the pulp and paper
industry.
Ravikumar Nandagopalan has been an officer and director of the Company
since August 3, 2009. Mr. Nandagopalan has been an officer and director of
4gDeals since March 2008. Mr. Nandagopalan has been involved with computer
software design and development since 1999. Mr. Nandagopalan's assignments in
this field for the past five years were: Cisco Systems (since August 2007),
Geico (February - July 2007), Federal Home Loan and Mortgage Co. (January 2006 -
February 2007), National Association of Security Dealers, Inc. (May 2005 -
November 2005) and CitiFinancial (April 2004 - May 2005).
Mr. McMahon was appointed a director of the Company on December 18, 2009.
In September 2009 Mr. McMahon became the Chief Operating Officer of the
Company's wholly owned subsidiary, Yu Deal Inc. (formerly 4gDeals, Inc.), where
he has been managing the development of the Company's electronic coupon
distribution system. Between January 2009 and November 2009, Mr. McMahon worked
as an independent consultant to various interactive media companies providing
advice on project management and technology development. Between October 2007
and December 2008 Mr. McMahon was the Chief Operating Officer of the Scully
Group in Asheville, North Carolina. At the Scully Group, Mr. McMahon guided
company strategy, project management, technology development, human resources
and finance. Between March 2006 and October 2007 Mr. McMahon developed
Wisdomology.com, a social networking website. Between February 1996 and March
2006 Mr. McMahon held various positions in the information technology division
of the Coca-Cola Company, including as a director of that division (2005 to
2006). From 1990 to 1993, Mr. McMahon did graduate research in atmospheric
chemistry at MIT under the guidance of the 1995 Nobel Laureate in Chemistry
Mario Molina. Mr. McMahon received a Bachelor of Arts degree in Physics from
Harvard University in 1989.
The Company does not have a compensation or an audit committee. The
Company does not have a financial expert.
None of the Company's directors are independent as that term is defined in
section 803 of listing standards of the NYSE Alternext US. The Company does not
compensate any person for acting as a director.
The Company has not adopted a Code of Ethics applicable to its principal
executive, financial, and accounting officers and persons performing similar
functions. The Company does not believe it requires a Code of Ethics since its
only has one officer.
Changes in Management
- ---------------------
The following shows the changes in the Company's management since its
inception:
8
Appointed (A)
to or
Resigned (R) Positions Appointed to
Date Name from Position or Resigned From
- ---- ---- ------------- ----------------------
12/22/06 John Sutherland A President, Principal Financial
Officer, Secretary and Director.
9/9/08 John Sutherland R President, Principal Financial
Officer and Secretary.
9/9/08 Stephen Clevett A President, Principal Financial
Officer, Secretary and a
Director.
9/12/08 John Sutherland R Director
9/24/08 Stephen Clevett R President, Principal Financial
Officer, Secretary and a
Director.
9/24/08 Robert Shea A President, Principal Financial
Officer, Secretary and a
Director.
1/16/09 Robert Shea R President, Principal Financial
Officer, Secretary and Director
1/16/09 Jeffrey Collins A President, Principal Financial
Officer, Secretary and Director
8/3/09 Jeffrey Collins R President, Principal Financial
Officer, Secretary and Director
8/3/09 Isaac Roberts A President, Principal Financial
Officer, Principal Accounting
Officer and a Director
8/3/09 Ravikumar Nandagopalan A Secretary, Treasurer and a
Director
12/18/09 James R. McMahon A Director
Compensation Committee Interlocks and Insider Participation.
- ------------------------------------------------------------
The Company's director acts as its compensation committee. During the year
ended December 31, 2008, none of the Company's officers was also a member of the
compensation committee or a director of another entity, which other entity had
one of its executive officers serving as a director of the Company or as a
member of the Company's compensation committee.
9
ITEM 11. EXECUTIVE COMPENSATION
----------------------
The following table shows the compensation paid or accrued during the year
ended December 31, 2008 to the executive officers of the Company. No officer of
the Company has ever received compensation in excess of $100,000 per year.
Jeffrey Collins became an officer of the Company in January 2009 and
resigned in August 2009.
All
Other
Annual
Stock Option Compen-
Name and Principal Fiscal Salary Bonus Awards Awards sation
Position Year (1) (2) (3) (4) (5) Total
- ------------------ ------ ------ ----- ------ ------ ------- -----
Robert Shea 2008 - - - - - -
Chief Executive Officer
(9-08 to 1-09)
Steven Clevett 2008 - - - - - -
(9-08 to 9-08)
John H. Sutherland 2008 - - - - - -
Chief Executive 2007
Officer
(12-06 to 9-08)
(1) The dollar value of base salary (cash and non-cash) received.
(2) The dollar value of bonus (cash and non-cash) received.
(3) During the periods covered by the table, the value of the Company's shares
issued as compensation for services to the persons listed in the table.
(4) The value of all stock options granted during the periods covered by the
table.
(5) All other compensation received that the Company could not properly report
in any other column of the table.
See Item 10 of this report regarding changes in the Company's management.
The Company does not have employment agreements with any of its officers.
The following shows the amounts that the Company expects to pay to its
officer during the twelve-month period ending December 31, 2010, and the time
its officer plans to devote to the Company's business. The Company does not have
employment agreements with any person.
10
Proposed Time to be Devoted to
Name Compensation Company's Business
---- ------------ ---------------------
Isaac Roberts $ 60,000 100%
Ravikumar Nandagopalan $ 20,000 25%
James R. McMahon
Long-Term Incentive Plans. The Company does not have any pension, stock
appreciation rights, long-term incentive or other plans and has no intention of
implementing any of these plans for the foreseeable future.
Employee Pension, Profit Sharing or other Retirement Plans. The Company
does not have a defined benefit, pension plan, profit sharing or other
retirement plan, although it may adopt one or more of such plans in the future.
Compensation of Directors. The Company's directors did not receive any
compensation for their services as directors during the fiscal year ended
December 31, 2008.
Stock Option and Bonus Plans
- ----------------------------
The Company has not adopted any stock option or stock bonus plans.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
------------------------------------------------------------------
RELATED STOCKHOLDERS MATTERS
----------------------------
The following table lists, as of December 31, 2009, those persons owning
beneficially 5% or more of the Company's common stock, the number and percentage
of outstanding shares owned by each director and officer of the Company and by
all officers and directors as a group. Unless otherwise indicated, each owner
has sole voting and investment powers over his shares of common stock.
Name and Address Number of Shares Percent of Class
- ---------------- ---------------- ----------------
Issac Roberts 16,295,925 60.6%
58 1/2 North Lexington Ave.
Asheville, North Carolina 28801
Ravikumar Nandagopalan 3,499,125 13.0%
58 1/2 North Lexington Ave.
Asheville, North Carolina 28801
James R. McMahon -- --
58 1/2 North Lexington Ave.
Asheville, North Carolina 28801
11
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
----------------------------------------------
On January 10, 2007 the Company sold 1,500,000 shares of its common stock
to John Sutherland, then the Company's only officer and director, for $15,000,
or $0.01 per share. These 1,500,000 shares were then transferred to Consultants
& Risk Management, Inc. a corporation controlled by Robert Shea.
On January 15, 2009 Robert Shea resigned as an officer and director of the
Company. Prior to his resignation Mr. Collins was appointed the Company's
President, Chief Financial Officer, Secretary and a director.
On January 15, 2009 Jeffrey A. Collins purchased 1,500,000 shares of the
Company's common stock from Consultants & Risk Management, Inc.
As a result of the June 2009 forward stock split the 1,500,000 shares
owned by Mr. Collins were converted to 4,500,000 shares.
On August 3, 2009 the Company acquired all of the outstanding shares of
4gDeals, Inc. for 15,495,000 shares of the Company's common stock. In connection
with the acquisition:
o Isaac Roberts received 11,795,000 shares in exchange for his shares of
4gDeals, Inc.;
o Ravikumar Nandagopalan received 3,499,125 shares in exchange for his
shares of 4gDeals;
o Jeffrey Collins resigned as the Company's sole officer and director;
o Isaac Roberts was appointed the Company's President and as a director;
o Ravikumar Nandagopalan was appointed the Company's Secretary and
Treasurer and as a director; and
o Jeffrey Collins sold 4,500,000 shares of the Company's common stock to
Isaac Roberts for a nominal price;
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
--------------------------------------
John Kinross-Kennedy audited the Company's financial statements for the
years ended December 31, 2008 and 2007. The following table shows the aggregate
fees billed to the Company during the years ended December 31, 2008 and 2007 by
Mr. Kinross-Kennedy.
2008 2007
---- ----
Audit Fees $2,000 $2,800
Audit-Related Fees $ 900 --
Financial Information Systems -- --
Design and Implementation Fees -- --
Tax Fees -- --
All Other Fees -- --
12
Audit fees represent amounts billed for professional services rendered for
the audit of The Company's annual financial statements and the review of the
Company's interim financial statements. Before Mr. Kinross-Kennedy was engaged
by the Company to render these services, the engagement was approved by the
Company's Directors.
ITEM 15. EXHIBITS
--------
Exhibit
Number Exhibit Name
- ------- ------------
3.1 Articles of Incorporation *
3.2 Bylaws *
10.1 Mining Lease *
31 Rule 13a-14(a) Certifications
32 Section 1350 Certifications
* Incorporated by reference to the same exhibit filed with the Company's
registration statement on Form SB-2 (File # 333-145951).
13
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To: the Board of Directors and Shareholders
Cyprium Resources Inc.
I have audited the accompanying balance sheet of Cyprium Resources Inc. as of
December 31, 2008 and 2007, and the related statements of operations, and of
cash flows for the years ended 2008 and 2007 and the period of inception
(December 22, 2006) to December 31, 2008. These financial statements are the
responsibility of the Company's management. My responsibility is to express an
opinion on these financial statements based on my audit.
I conducted my audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that I plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. I believe that my audit provide a reasonable
basis for my opinion.
In my opinion, based on my audit, the financial statements referred to above
present fairly, in all material respects, the financial position of Cyprium
Resources Inc. as of December 31, 2008 and 2007 and the results of its
operations, and its cash flows for the years ended December 31, 2008 and 2007
and the period of inception (December 22, 2006) to December 31, 2008 in
conformity with United States generally accepted accounting principles.
The Company's financial statements are prepared using accounting principles
generally accepted in the United States of America applicable to a going
concern, which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. The Company has not yet
established an ongoing source of revenues sufficient to cover its operating
costs and to allow it to continue as a going concern. In addition, the Company
has a deficit accumulated in the development stage of $59,316 as of December 31,
2008. These factors raise substantial doubt concerning the Company's ability to
continue as a going concern. The ability of the Company to continue as a going
concern is dependent on the Company obtaining adequate capital to fund operating
losses until it becomes profitable. However, management cannot provide any
assurances that the Company will be successful in accomplishing any of its
plans. If the Company is unable to obtain adequate capital, it could be forced
to cease development of operations. The accompanying financial statements do not
include any adjustments that might be necessary if the Company is unable to
continue as a going concern.
The Company has determined that it is not required to have, nor was I engaged to
perform, an audit of the effectiveness of its documented internal controls over
financial reporting.
John Kinross-Kennedy
Certified Public Accountant
Irvine, California
April 8, 2009
F-1
CYPRIUM RESOURCES, INC.
(A Development Stage Company)
Balance Sheet
for the year ended December 31,
2008 2007
---------- ----------
ASSETS
Current Assets
Cash $ 3,409 $ 21,537
---------- ----------
Total Current Assets 3,409 21,537
---------- ----------
Total Assets $ 3,409 $ 21,537
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts Payable 225 $ 100
---------- ----------
$ 225 $ 100
---------- ----------
Non Current Assets
Loans from Officer $ - $ -
---------- ----------
Total Non Current Assets $ - $ -
---------- ----------
Total Liabilities $ 225 $ 100
---------- ----------
Shareholders' Equity
Common Stock, $0.001 par value;
authorized 75,000,000 shares; issued
and outstanding
3,625,000 shares as at December 31, 2007;
3,625,000 shares as at December 31, 2008 $ 3,625 $ 3,625
Additional Paid-In Capital 58,875 53,875
Deficit accumulated during the development
stage (59,316) (36,063)
---------- ----------
Total Shareholders' Equity $ 3,184 $ 21,437
---------- ----------
Total Liabilities and Shareholders'
Equity $ 3,409 $ 21,537
========== ==========
The accompanying notes are an integral part of these financial statements.
F-2
CYPRIUM RESOURCES, INC.
(A Development Stage Company)
Statement of Operations
For the For the Period
December 31, of Inception
Year Ended Dec. 22, 2006)
-------------------- to Dec. 31,
2008 2007 2008
-------------------- ---------------
Revenue $ - $ - $ -
Cost of Sales - - -
-------- -------- --------
Operating Income - - -
General and Administrative Expenses:
Mining Leases 6,650 9,000 15,650
Consulting 11,119 425 33,602
Professional Fees 3,525 22,483 6,475
Licenses & Permits 325 2,950 750
Other Administrative Expenses 1,634 1,205 2,839
-------- -------- --------
Total General and Administrative
Expenses 23,253 36,063 59,316
-------- -------- --------
Net Loss $(23,253) $(36,063) $(59,316)
========= ========= =========
Loss Per Common Share:
Basic and Diluted $ (0.006) $ (0.013)
========= =========
Weighted Average Shares
Outstanding, Basic and Diluted: 3,625,000 2,723,973
========= =========
The accompanying notes are an integral part of these financial statements.
F-3
CYPRIUM RESOURCES, INC.
(A Development Stage Company)
Statement of Cash Flows
For the
Year ended For the Period
December 31, of Inception
------------------- (Dec. 22, 2006)
2008 2007 to Dec. 31, 2008
---- ---- ----------------
Cash flows from operating
activities:
Net loss $ (23,253) $ (36,063) $ (59,316)
--------- --------- -----------
Adjustments to reconcile
net loss to net cash used
by operating activities:
Change in operating assets
and liabilities:
Increase in accounts payable
and accrued liabilities 125 100 225
--------- --------- -----------
Net cash (used by) operating
activities (23,128) (35,963) (59,091)
--------- --------- -----------
Cash flows from investing
activities - - -
--------- --------- -----------
Net cash (used by) investing
activities - - -
--------- --------- -----------
Cash flows from financing
activities:
Common stock issued for cash - 57,500 57,500
Contributed Capital 5,000 - 5,000
Due to related parties - - -
--------- --------- -----------
Net cash (used) provided by
financing activities 5,000 57,500 62,500
--------- --------- -----------
Net increase (decrease) in cash (18,128) 21,537 3,409
Cash, beginning of the period 21,537 - -
--------- --------- -----------
Cash, end of the period $ 3,409 $ 21,537 $ 3,409
========= ========= ===========
Supplemental cash flow
disclosure:
Interest paid $ - $ - $ -
========= ========= ===========
Taxes paid $ - $ - $ -
========= ========= ===========
The accompanying notes are an integral part of these financial statements.
F-4
CYPRIUM RESOURCES, INC.
(A Development Stage Company)
Statement of Shareholders' Equity
Common Stock Deficit
----------------- Accumulated Total
Number Additional during the Shareholders'
of Paid-In Development Equity
Shares Amount Capital Stage (Deficit)
------ ------- ---------- ----------- -------------
Inception, January 1, 2006 - $ - $ - $ - $ -
Common stock issued for cash,
December 22, 2007 @ $0.01 per
share 1,500,000 1,500 13,500 15,000
Common stock issued for cash,
May, 2007 @ $0.02 per share 1,325,000 1,325 25,175 26,500
Common stock issued for cash,
June, 2007 @ $0.02 per share 800,000 800 15,200 16,000
Net loss for the year ended
December 31, 2007 (36,063) (36,063)
----------- -------- --------- --------- ---------
Balances, December 31, 2007 3,625,000 $ 3,625 $ 53,875 $(36,063) $ 21,437
Capital contributed
November 26, 2008 5,000 5,000
Net loss for the year ended
December 31, 2008 (23,253) (23,253)
----------- -------- --------- --------- ---------
Balances, December 31, 2008 3,625,000 $ 3,625 $ 58,875 $(59,316) $ 3,184
=========== ======== ========= ========= =========
The accompanying notes are an integral part of these financial statements.
F-5
Cyprium Resources, Inc.
(A Developmental Stage Company)
Notes to Financial Statements
December 31, 2008
1. Corporate Overview
Organization
Cyprium Resources, Inc. (the "Company") was incorporated under the laws of
the State of Nevada December 22, 2006. The Company was formed for mineral
exploration in the United States.
Current Business of the Corporation
On January 15, 2007 the Company entered into a 20 year lease agreement with
the owner of 10 mining claims situated in Utah, known as the King claims.
The lease was maintained current through September 30, 2008, however mining
activities were limited. The Company has terminated the lease.
Change in Officers and Directors
On September 9, 2008, John Sutherland resigned as President, Chief
Financial Officer and Secretary of the Company. By Board resolution on the
same date, Stephen H. Cleven was appointed to these offices. He resigned
September 24. On that date Robert Shea, a resident of the state of
Massachusetts, was appointed President, Chief Financial Officer, Treasurer
and Secretary. Mr. Shea purchased Mr. Sutherland's interest in the Company.
Change in Corporation Offices
In September, 2008 the Company moved its offices to Beijing in anticipation
of business operations in China. The decision was made subsequently to
return the corporate office to the United States.
2. Summary of Significant Accounting Policies
Basis of Presentation
---------------------
The financial statements of the Company have been prepared using the
accrual basis of accounting in accordance with generally accepted
accounting principles in the United States. Because a precise determination
of many assets and liabilities is dependent upon future events, the
preparation of financial statements for a period necessarily involves the
use of estimates which have been made using careful judgment.
F-6
Use of Estimates
----------------
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make certain estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the financial
statements, and reported amounts of revenue and expenses during the
reporting period. Actual results could differ materially from those
estimates. Significant estimates made by management are, among others,
realizability of long-lived assets, deferred taxes and stock option
valuation.
The financial statements have, in management's opinion, been properly
prepared within the reasonable limits of materiality and within the
framework of the significant accounting.
Income Taxes
------------
The Company utilizes SFAS No. 109, "Accounting for Income Taxes," which
requires the recognition of deferred tax assets and liabilities for the
expected future tax consequences of events that have been included in the
financial statements or tax returns. Under this method, deferred tax assets
and liabilities are determined based on the difference between the tax basis
of assets and liabilities and their financial reporting amounts based on
enacted tax laws and statutory tax rates applicable to the periods in which
the differences are expected to affect taxable income. Valuation allowances
are established, when necessary, to reduce deferred tax assets to the amount
expected to be realized. The Company generated a deferred tax credit through
net operating loss carryforward. However, a valuation allowance of 100% has
been established, as the realization of the deferred tax credits is not
reasonably certain, based on going concern considerations outlined as
follows.
Going Concern
-------------
The Company's financial statements are prepared using accounting principles
generally accepted in the United States of America applicable to a going
concern, which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. The Company has not yet
established an ongoing source of revenues sufficient to cover its operating
costs and to allow it to continue as a going concern. The ability of the
Company to continue as a going concern is dependent on the Company obtaining
adequate capital to fund operating losses until it becomes profitable. If
the Company is unable to obtain adequate capital, it could be forced to
cease development of operations.
The ability of the Company to continue as a going concern is dependent upon
its ability to successfully accomplish its plans to exploit or lease its
mining claim described in the initial paragraph, or engage a working
interest partner, in order to eventually secure other sources of financing
and attain profitable operations. The accompanying financial statements do
not include any adjustments relating to the recoverability and
classification of recorded asset amounts or the amount and classifications
or liabilities or other adjustments that might be necessary should the
Company be unable to continue as a going concern.
F-7
Development-Stage Company
-------------------------
The Company is considered a development-stage company, with limited
operating revenues during the periods presented, as defined by Statement of
Financial Accounting Standards ("SFAS") No. 7. SFAS. No. 7 requires
companies to report their operations, shareholders deficit and cash flows
since inception through the date that revenues are generated from
management's intended operations, among other things. Management has defined
inception as January 1, 2007. Since inception, the Company has incurred an
operating loss of $59,316 The Company's working capital has been generated
through the sales of common stock. Management has provided financial data
since January 1, 2007, "Inception" in the financial statements, as a means
to provide readers of the Company's financial information to make informed
investment decisions.
Basic and Diluted Net Loss Per Share
------------------------------------
Net loss per share is calculated in accordance with SFAS 128, Earnings Per
Share for the period presented. Basic net loss per share is based upon the
weighted average number of common shares outstanding. Diluted net loss per
share is based on the assumption that all dilative convertible shares and
stock options were converted or exercised. Dilution is computed by applying
the treasury stock method. Under this method, options and warrants are
assumed exercised at the beginning of the period (or at the time of
issuance, if later), and as if funds obtained thereby we used to purchase
common stock at the average market price during the period.
The Company has no potentially dilutive securities outstanding as of
December 31, 2008.
The following is a reconciliation of the numerator and denominator of the
basic and diluted earnings per share computations for the year ended
December 31,
2008 2007
---- ----
Numerator:
----------
Basic and diluted net loss per share:
Net Loss $ (23,253) $ (36,063)
Denominator
-----------
Basic and diluted weighted average
number of shares outstanding 3,625,000 2,723,973
Basic and Diluted Net Loss Per Share $ (0.006) $ (0.013)
------------------------------------
F-8
3. Capital Structure
During the period from inception through December 31, 2008, the Company
entered into the following equity transactions:
January 10, 2007: Sold 1,500,000 shares of common stock at
$.01 per share for $15,000.
During May, 2007: Sold 1,325,000 shares of common stock at $.02 per
share for $26,500.
During June, 2007: Sold 800,000 shares of common stock at $0.02 per
share, realizing $16,000
Capital contributed November 26, 2008: $5,000
As of December 31, 2008, the Company has authorized, 75,000,000 of $0.001
par common stock, of which 3,625,000 shares were issued and outstanding.
4. Commitments
On January 15, 2007 the Company paid $4,500 and entered into a 20 year lease
agreement with the owner of 10 mining claims situated in Utah, known as the
King claims. The agreement was rescinded in the third quarter of 2008.
6. Contingencies, Litigation
There were no loss contingencies or legal proceedings against the Company
with respect to matters arising in the ordinary course of business. Neither
the Company nor any of its officers or directors is involved in any other
litigation either as plaintiffs or defendants, and have no knowledge of any
threatened or pending litigation against them or any of the officers or
directors.
F-9
SIGNATURES
In accordance with Section 13 or 15(a) of the Exchange Act, the Registrant
has caused this Report to be signed on its behalf by the undersigned, thereunto
duly authorized on the 22nd day of January 2010.
DIGITAL DEVELOPMENT PARTNERS, INC.
By /s/ Isaac Roberts
------------------------------------
Isaac Roberts, President and Principal
Executive, Financial and Accounting
Officer
Pursuant to the requirements of the Securities Act of l934, this Report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.
Title Date
/s/ Isaac Roberts
- ------------------------------
Isaac Roberts Director January 22, 2010
/s/ Ravikumar Nandagopalan
- ------------------------------
Ravikumar Nandagopalan Director January 22, 2010
/s/ James R. McMahon
James R. McMahon Director January 22, 2010
DIGITAL DEVELOPMENT PARTNERS, INC.
REPORT ON FORM 10-K/A
EXHIBITS