U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 2009
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from to
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Commission File No.
0-51638
Plan A Promotions, Inc.
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(Name of Small Business Issuer as specified in its charter)
UTAH 16-1689008
---- -----------
(State or other jurisdiction of (Employer I.D. No.)
organization)
3010 Lost Wood Drive
Sandy, Utah 84092
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(Address of Principal Executive Office)
Issuer's Telephone Number, including Area Code: (801) 231-1121
(Former Name or Former Address, if changed since last Report)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Sections 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.
(1) Yes X No (2) Yes X 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. (as
defined in Rule 12b-2 of the Exchange Act).
Large accelerated filer [_] Accelerated filer [_]
Non-accelerated filer [_] Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes |X| No |_|
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS
None, Not Applicable;
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by court. Yes |_| No |X|
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding
of each of the Registrant's classes of common stock, as of the latest
practicable date:
May 13, 2009
1,200,000
1
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The Financial Statements of the Registrant required to be filed with this
10-Q Quarterly Report were prepared by management and commence on the following
page, together with related Notes. In the opinion of management, the Financial
Statements fairly present the financial condition of the Registrant. The
Financial Statements are on file with the Company's Auditor.
Plan A Promotions, Inc.
[A Development Stage Company]
Condensed Balance Sheets
As of March 31, 2009
and September 30, 2008
3/31/2009 9/30/2008
----------------- -----------------
[Unaudited] [Audited]
ASSETS
Assets
Current Assets
Cash $ - $ 3,750
----------------- -----------------
Total Current Assets - 3,750
Property & Equipment (net) $ - $ -
----------------- -----------------
Total Assets $ - $ 3,750
================= =================
LIABILITIES AND STOCKHOLDERS' DEFICIT
Liabilities
Current Liabilities
Accounts Payable $ 8,909 $ 6,407
Accrued Liabilities 686 786
Related-Party Payable - Note 3 9,532 9,159
----------------- -----------------
Total Current Liabilities 19,127 16,352
Long Term Liabilities
Loans from Shareholders - Note 3 25,000 25,000
Accrued Interest Payable - Shareholders - Note 3 3,748 2,497
----------------- -----------------
Total Long Term Liabilities 28,748 27,497
----------------- -----------------
Total Liabilities $ 47,875 $ 43,849
Stockholders' Deficit
Preferred Stock; par value ($0.01); - -
Authorized 5,000,000 shares
none issued or outstanding
Common Stock; par value ($0.01);
Authorized 50,000,000 shares; issued
and outstanding 1,200,000 12,000 12,000
Paid-in Capital 24,237 24,237
Deficit Accumulated during the development stage (84,112) (76,336)
----------------- -----------------
Total Stockholders' Deficit (47,875) (40,099)
----------------- -----------------
Total Liabilities and Stockholders' Deficit $ - $ 3,750
================= =================
See accompanying notes to condensed financial statements
2
Plan A Promotions, Inc.
[A Development Stage Company]
Condensed Statements of Operations
For the Three and Six Month Periods Ended March 31, 2009 and 2008
and For the Period from Inception through March 31, 2009
For the For the For the For the Since Inception
Three Months Three Months Six Months Six Months [12/12/03]
Ended Ended Ended Ended through
3/31/2009 3/31/2008 3/31/2009 3/31/2008 3/31/2009
------------- ------------- ------------- ------------- ------------
Revenues $ - $ - $ - $ - $ 9,694
Revenues from Related Parties $ - $ - $ - $ - $ 2,346
------------- ------------- ------------- ------------ ------------
Total Revenue $ - $ - $ - $ - $ 12,040
Cost of Sales $ - $ - $ - $ - $ 8,394
Cost of Sales to Related Parties $ - $ - $ - $ - $ 2,101
------------- ------------- ------------- ------------- ------------
Total Cost of Sales $ - $ - $ - $ - $ 10,495
------------- ------------- ------------- ---------------------------
Gross Profit $ - $ - $ - $ - $ 1,545
General & Administrative Expenses 1,074 4,195 6,152 12,205 78,911
------------- ------------- ------------- ------------- ------------
Net Loss from Operations (1,074) (4,195) (6,152) (12,205) (77,366)
Other Income/(Expenses):
Interest Expense (807) (436) (1,624) (876) (6,246)
------------- ------------- ------------- ------------- ------------
Net Loss Before Income Taxes (1,881) (4,631) (7,776) (13,081) (83,612)
Provision for Income Taxes - - - - (500)
------------- ------------- ------------- ------------- ------------
Net Loss (1,881) (4,631) (7,776) (13,081) (84,112)
============= ============= ============= ============= ============
Loss Per Share $ (0.01) $ (0.01) $ (0.01) $ (0.01) $ (0.07)
============= ============= ============= ============= ============
Weighted Average Shares Outstanding 1,200,000 1,200,000 1,200,000 1,200,000 1,194,447
============= ============= ============= ============= ============
See accompanying notes to condensed financial statements
3
Plan A Promotions, Inc.
[A Development Stage Company]
Condensed Statements of Cash Flows
For the Six Month Periods Ended March 31, 2009 and 2008
and For the Period from Inception through March 31, 2009
For the For the Since Inception
Six Months Six Months [12/12/03]
Ended Ended through
3/31/2009 3/31/2008 3/31/2009
------------ ------------ ------------
Net Loss (7,776) (13,081) (84,112)
Adjustments to reconcile net income/(loss) to net cash
From Operating Activities:
Depreciation - 1,474 8,906
Changes in operating assets and liabilities:
Increase/(Decrease) in Current/Accrued Liabilities 2,402 3,099 17,671
Accrued Interest 1,624 876 5,204
------------ ------------ ------------
Net Cash From Operating Activities (3,750) (7,632) (52,331)
Cash From Investing Activities
Purchase of equipment - - (7,406)
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Net Cash From Investing Activities - - (7,406)
Cash From Financing Activities
Issued Stock for Cash - - 34,737
Loan from Shareholders - - 25,000
------------ ------------ ------------
Net Cash From Financing Activities - - 59,737
Net Increase/(Decrease) in cash (3,750) (7,632) -
Beginning Cash Balance 3,750 8,056 -
------------ ------------ ------------
Ending Cash Balance $ - $ 424 $ -
============ ============ ============
Supplemental Schedule of Cash Flow Activities
Cash paid for income taxes $ 100 $ - $ 500
Property contributed by shareholder $ - $ - $ 1,500
See accompanying notes to condensed financial statements
4
Plan A Promotions, Inc.
[A Development Stage Company]
Notes to the Condensed Financial Statements
NOTE 1- BASIS OF PRESENTATION
The accompanying unaudited, condensed financial statements of Plan A
Promotions, Inc. (the "Company" or "Plan A Promotions"), have been
prepared in accordance with the rules and regulations of the
Securities and Exchange Commission ("SEC") and disclosures normally
included in the financial statements prepared in accordance with
generally accepted accounting principles have been condensed or
omitted. It is suggested that these condensed financial statements be
read in conjunction with the audited financial statements and notes
thereto contained in the Company's Annual Report on Form 10-K for the
period ended September 30, 2008. In the opinion of management these
interim financial statements contain all adjustments, which consist of
normal recurring adjustments, necessary for a fair presentation of
financial position. The results of operations for the interim period
are not necessarily indicative of the results to be expected for the
full year.
NOTE 2- LIQUIDITY/GOING CONCERN
The Company has accumulated losses since inception, has minimal
assets, and has a net operating loss of ($1,881) for the three months
ended March 31, 2009. These factors raise substantial doubt about the
Company's ability to continue as a going concern.
Management plans include raising capital to further its business
operations, or seeking a well capitalized merger candidate. The
financial statements do not include any adjustments that might result
from the outcome of this uncertainty. If the Company is unable to
develop its operations, the Company may have to cease to exist.
NOTE 3- RELATED PARTY TRANSACTIONS
Salaries to the President of the Company were accruing at a rate of
$250 per month. As of January 1, 2007, the Company suspended all
salaries until the Company's operations generate positive cash flow.
The balance payable accrues interest at a simple interest rate of 10%
annually. Salaries expense was $750 and $3,000 for 2007 and 2006,
respectively. Salaries payable at March 31, 2009 was $9,532, including
accrued interest. During the quarter ended March 31, 2009, the Company
accrued interest associated with the Salaries payable of $186. The
balance is unsecured and payable upon demand.
During the year ended September 30, 2007 and 2008 a shareholder loaned
the Company a combined $20,000 on an unsecured debenture. The Note
accrues interest at 10% per annum and matures on December 31, 2011. As
of March 31, 2009, the Company has accrued interest of $2,702 on this
note. During the quarter ended March 31, 2009, the Company accrued
interest associated with this Note of $494.
During the year ended September 30, 2007 a shareholder loaned the
Company $5,000 on an unsecured debenture. The Note accrues interest at
10% per annum and matures on December 31, 2011. As of March 31, 2009,
the Company has accrued interest of $1,046 on this note. During the
quarter ended March 31, 2009, the Company accrued interest associated
with this Note of $127.
Eight shareholders, excluding the Company's Executive Officers,
control 75.3% of the Company's issued and outstanding common stock. As
a result, these majority shareholders could exercise significant
influence over all matters requiring stockholder approval, including
the election of directors and approval of significant corporate
transactions. Such concentration of ownership may also have the effect
of delaying or preventing a change in control of the Company.
5
Note 4- RECENT ACCOUNTING PRONOUNCEMENTS
In September 2006, the Financial Accounting Standards Board ("FASB")
issued SFAS No. 157, "Fair Value Measurements" ("SFAS 157"). SFAS 157
defines fair value, establishes a framework for measuring fair value,
and requires enhanced disclosures about fair value measurements. SFAS
157 requires companies to disclose the fair value of their financial
instruments according to a fair value hierarchy as defined in the
standard. Additionally, companies are required to provide enhanced
disclosure regarding financial instruments in one of the categories,
including a reconciliation of the beginning and ending balances
separately for each major category of assets and liabilities. In
February 2008, the FASB issued FASB Staff Position (FSP) No. FAS
157-2, which delays by one year the effective date of SFAS No. 157 for
certain types of non-financial assets and non-financial liabilities.
As a result, SFAS 157 will be effective for financial statements
issued for fiscal years beginning after November 15, 2007, or the
Company's fiscal year beginning October 1, 2008, for financial assets
and liabilities carried at fair value on a recurring basis, and on
October 1, 2009, for non-recurring non-financial assets and
liabilities that are recognized or disclosed at fair value. The
Company adopted SFAS No. 157 on October 1, 2008 for financial assets
and liabilities carried at fair value on a recurring basis, with no
material impact on its consolidated financial statements. The Company
is currently determining what impact the application of SFAS 157 on
October 1, 2009 for non-recurring non-financial assets and liabilities
that are recognized or disclosed at fair value will have on its
financial statements.
In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option
for Financial Assets and Financial Liabilities" ("SFAS 159"). This
Statement provides companies with an option to report selected
financial assets and liabilities at fair value. Generally accepted
accounting principles have required different measurement attributes
for different assets and liabilities that can create artificial
volatility in earnings. The Statement's objective is to reduce both
complexity in accounting for financial instruments and the volatility
in earnings caused by measuring related assets and liabilities
differently. The Company adopted SFAS 159 at October 1, 2008 with no
material impact to the Company's financial statements.
In December 2007, the FASB issued SFAS No. 141 (revised 2007) ("SFAS
141R"), "Business Combinations" and SFAS No. 160 ("SFAS 160"),
"Noncontrolling Interests in Consolidated Financial Statements, an
amendment of Accounting Research Bulletin No. 51". SFAS 141R will
change how business acquisitions are accounted for and will impact
financial statements both on the acquisition date and in subsequent
periods. SFAS 160 will change the accounting and reporting for
minority interests, which will be recharacterized as noncontrolling
interests and classified as a component of equity. SFAS 141R and SFAS
160 are effective for the Company beginning October 1, 2009. Early
adoption is not permitted. The Company is evaluating the impact these
statements will have on its financial statements.
In March 2008, the FASB issued SFAS No. 161 "Disclosures about
Derivative Instruments and Hedging Activities" ("SFAS No. 161"), which
will be effective for the Company beginning October 1, 2009. SFAS No.
161 changes the disclosure requirements for derivative instruments and
hedging activities. Entities are required to provide enhanced
disclosures about (i) how and why an entity uses derivative
instruments, (ii) how derivative instruments and related hedging items
are accounted for under SFAS No. 133 "Accounting for Derivative
Instruments and Hedging Activities" and its related interpretations,
and (iii) how derivative instruments and related hedged items affect
an entity's financial position, financial performance, and cash flows.
The Company is evaluating the impact this statement may have on its
financial statements.
The Company has reviewed all other recently issued, but not yet
adopted, accounting standards in order to determine their effects, if
any, on its results of operation, financial position or cash flows.
Based on that review, the Company believes that none of these
pronouncements will have a significant effect on its financial
statements.
6
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
PLAN OF OPERATION
The Company's plan of operation for the next 12 months is to continue with
its current business operations. However, the Company has accumulated losses
since inception and has not been able to generate profits from operations.
Operating capital has been raised through the Company's shareholders.
Furthermore, the Company has not been able to generate positive cash flow from
operations since inception. Management plans include raising capital to further
its business operations, or seeking a well capitalized merger candidate. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty. If the Company is unable to develop its operations,
the Company may have to cease to exist.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATION
OPERATING RESULTS - OVERVIEW
The three month period ended March 31, 2009, resulted in a net loss of
$1,881. The Basic Loss per Share for the three month period ended March 31, 2009
was ($0.01). Details of changes in revenue and expenses can be found below.
OPERATING RESULTS REVENUES
The Company has not generated a profit since inception. The Company did not
generate any revenue in the three month period ended March 31, 2009 or 2008. The
Company's management has been unable to identify a viable market for its product
and service offering, and therefore was unable to generate any revenue in either
period.
OPERATING RESULTS - COST OF SALES
The Company did not incur any cost of sales given that it was unable to
generate any revenue in the three months ended March 31, 2009 or 2008.
OPERATING RESULTS - OPERATING EXPENSES
Operating expense for the three month period ended March 31, 2009, was
$1,074. Operating expenses included accounting, legal and depreciation expenses.
- The Company's accounting expenses decreased $1,280 for the three month
period ended March 31, 2009 compared to the same three month period ended
March 31, 2008. The Company incurred $950 in accounting fees in the three
month period ended March 31, 2009, and incurred $2,230 in the three month
period March 31, 2008. The decrease in accounting expense can be attributed
to internal reporting efficiencies in regards to the oversight mandated by
the Sarbanes-Oxley Act of 2002 compared to the prior year comparable
quarter.
- Depreciation for the three month period ended March 31, 2009, was $0,
compared to the $737 in depreciation the Company incurred for the three
month period ended March 31, 2008. The Company has previously depreciated
all property and equipment, therefore the Company did not expense any
additional depreciation in the quarter ended March 31, 2009.
7
OPERATING RESULTS - INTEREST EXPENSES
The Company incurred $807 in interest expense in the three month period
ended March 31, 2009. In the three month period ended March 31, 2008, the
Company incurred $436 in interest expense. The increase in interest expense is
due to higher notes payable balances from loans obtained from the Company's
shareholders in the 2008 fiscal year.
LIQUIDITY
As of March 31, 2009, the Company had $19,127 in current liabilities and
$28,748 in long-term debt.
The Company has a zero cash balance as of March 31, 2009. The Company's
management will advance the Company monies not to exceed $50,000 as loans to the
Company, to meet immediate liquidity requirments over the next twelve months.
The loan will be on terms no less favorable to the Company than would be
available from a commercial lender in an arm's length transaction. If the
Company needs funds in excess of $50,000, it will be up to the Company's
management to raise such monies. These funds may be raised as either debt or
equity, but management does not have any plans or relationships currently in
place to raise such funds. The Company can provide no assurances that if
additional funds are needed that it will be able to obtain financing.
The Company's ability to continue as a going concern is dependent on
management's ability to generate revenue and to manage the Company's expenses.
Management will continue to seek to explore opportunities to enhance the value
of the Company and its profitability.
CRITICAL ACCOUNTING POLICIES - ESTIMATES
Our discussion herein and analysis thereof is based upon our financial
statements in Item 1 above, which have been prepared in accordance with the
rules and regulations of the Securities and Exchange Commission("SEC")for
interim financial reporting. The preparation of these statements requires
management to make estimates and best judgments that affect the reported
amounts.
OFF-BALANCE SHEET ARRANGMENTS
We do not have any off-balance sheet arrangements as of March 31, 2009.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
This item is not applicable to smaller reporting companies.
Item 4(T). Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures (as defined in Rule 13a-15(e) under the
Exchange Act) are designed to ensure that information required to be disclosed
in reports filed or submitted under the Exchange Act is recorded, processed,
summarized, and reported within the time periods specified in rules and forms
adopted by the Securities and Exchange Commission ("SEC"), and that such
information is accumulated and communicated to management, including the
President and Secretary, to allow timely decisions regarding required
disclosures.
Under the supervision and with the participation of our management,
including our President and Secretary, we evaluated the effectiveness of the
design and operation of our disclosure controls and procedures (as defined in
Rule 13a-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act")).
Based upon that evaluation, our President and Secretary concluded that, as of
the end of the period covered by this report, our disclosure controls and
procedures were effective.
Changes in Internal Control Over Financial Reporting
During the most recent fiscal quarter covered by this report, there has
been no change in our internal control over financial reporting (as defined in
Rule 13a-15(f) under the Exchange Act) that has materially affected, or is
reasonably likely to materially affect, our internal control over financial
reporting.
8
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None; not applicable.
Item 1A. Risk Factors
This item is not applicable to smaller reporting companies.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None; not applicable
Item 3. Defaults Upon Senior Securities.
None; not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
None; not applicable
Item 5. Other Information.
None; applicable
Item 6. Exhibits.
(a) Exhibits
31.1 302 Certification of Alycia Anthony
31.2 302 Certification of Sharlene Doolin
32 906 Certification
(b)Reports on Form 8-K.
None; Not Applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
PLAN A PROMOTIONS, INC.
Date:05/13/09 /S/ALYCIA ANTHONY
Alycia Anthony, Principal Executive Officer,
President and Director
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this Report has also been signed below by the following person on
behalf of the Registrant and in the capacities and on the dates indicated.
Date:05/13/09 /S/SHARLENE DOOLIN
Sharlene Doolin, Principal Financial Officer,
Secretary and Director
9