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 December 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.
00-51638
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:
February 8, 2010
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 December 31, 2009
and September 30, 2009
12/31/2009 9/30/2009
----------------- -----------------
(Unaudited) (Audited)
ASSETS
Assets
Current Assets
Cash $ - $ -
Prepaid Expenses - 700
----------------- -----------------
Total Current Assets - 700
Property & Equipment (net) - -
----------------- -----------------
Total Assets $ - $ 700
================= =================
LIABILITIES AND STOCKHOLDERS' DEFICIT
Liabilities
Current Liabilities
Accounts Payable $ 6,665 $ 5,384
Accrued Liabilities 786 786
Related-Party Payable - Note 3 10,092 9,905
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Total Current Liabilities 17,543 16,075
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Long Term Liabilities
Loans from Shareholders - Note 3 30,816 30,816
Accrued Interest Payable - Shareholders - Note 3 5,973 5,197
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Total Long Term Liabilities 36,789 36,013
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Total Liabilities $ 54,332 $ 52,088
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 (90,569) (87,625)
----------------- -----------------
Total Stockholders' Deficit (54,332) (51,388)
----------------- -----------------
Total Liabilities and Stockholders' Deficit $ - $ 700
================= =================
See accompanying notes to condensed financial statements
2
Plan A Promotions, Inc.
[A Development Stage Company]
Condensed Statements of Operations
For the Three Month Period Ended December 31, 2009 and 2008
and For the Period from Inception through December 31, 2009
For the For the Since Inception
Three Months Three Months [12/12/03]
Ended Ended through
12/31/2009 12/31/2008 12/31/2009
---------------- ----------------- -----------------
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
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Total Cost of Sales - - 10,495
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Gross Profit - - 1,545
General & Administrative Expenses 1,981 5,078 82,484
---------------- ----------------- -----------------
Net Loss from Operations (1,981) (5,078) (80,939)
Other Income/(Expenses):
Interest Expense (963) (817) (9,030)
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Net Loss Before Income Taxes (2,944) (5,895) (89,969)
Provision for Income Taxes - - (600)
---------------- ----------------- -----------------
Net Loss (2,944) (5,895) (90,569)
================ ================= =================
Loss Per Share $ (0.01) $ (0.01) $ (0.08)
================ ================= =================
Weighted Average Shares Outstanding 1,200,000 1,200,000 1,195,135
================ ================= =================
See accompanying notes to condensed financial statements
3
Plan A Promotions, Inc.
[A Development Stage Company]
Condensed Statements of Cash Flows
For the Three Month Period Ended December 31, 2009 and 2008
and For the Period from Inception through December 31, 2009
For the For the Since Inception
Three Months Three Months [12/12/03]
Ended Ended through
12/31/2009 12/31/2008 12/31/2009
------------ ------------ ------------
Net Loss $(2,944) $(5,895) $(90,569)
Adjustments to reconcile net income/(loss) to net cash
From Operating Activities:
Depreciation - - 8,906
Changes in operating assets and liabilities:
(Increase)/Decrease in Prepaid Expenses 700 - -
Increase/(Decrease) in Current/Accrued Liabilities 1,281 4,699 15,527
Accrued Interest and Related Party Payable 963 817 7,989
------------ ------------ ------------
Net Cash From Operating Activities - (379) (58,147)
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 - - 30,816
------------ ------------ ------------
Net Cash From Financing Activities - - 65,553
Net Increase/(Decrease) in cash - (379) -
Beginning Cash Balance - 3,750 -
------------ ------------ ------------
Ending Cash Balance $ - $ 3,371 $ -
============ ============ ============
Supplemental Schedule of Cash Flow Activities
Cash paid for income taxes $ - $ 100 $ 600
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, 2009. 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 ($2,944) for the three months
ended December 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 payable at December 31, 2009 was $10,092, including
accrued interest. During the quarter ended December 31, 2009, the
Company accrued interest associated with the Salaries payable of $186.
The balance is unsecured and payable upon demand.
During the years ended September 30, 2007, 2008 and 2009 a shareholder
loaned the Company a combined $23,525 on an unsecured debenture. The
Notes accrue interest at 10% per annum and matures on December 31,
2011. As of December 31, 2009, the Company has accrued interest of
$4,474 on these notes. During the quarter ended December 31, 2009, the
Company accrued interest associated with these Notes of $593.
During the year ended September 30, 2007 a shareholder loaned the
Company $5,000 on an unsecured debenture. During the year ended
September 30, 2009 a shareholder loaned the Company $2,291 on an
unsecured debenture. The Notes accrue interest at 10% per annum and
mature on December 31, 2011. As of December 31, 2009, the Company has
accrued interest of $1,499 on these notes. During the quarter ended
December 31, 2009, the Company accrued interest associated with these
Notes of $184.
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"), which was
primarily codified into Topic 820 "Fair Value" in the ASC. 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 was 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 adopted SFAS 157 on
October 1, 2009 for non-recurring non-financial assets and liabilities
that are recognized of disclosed at fair value with no impact on its
financial statements.
In December 2007, the FASB issued SFAS No. 141 (revised 2007),
Business Combinations ("SFAS 141R"), which was primarily codified into
Topic 805 "Business Combinations" in the ASC, and SFAS No. 160,
Noncontrolling Interests in Consolidated Financial Statements, an
amendment of Accounting Research Bulletin No. 51("SFAS 160"), which
was primarily codified into Topic 810 "Consolidations" in the ASC.
SFAS 141R will change how businessacquisitions 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 characterized as noncontrolling
interests and classified as a component of equity. SFAS 141R and SFAS
160 was effective for the Company beginning October 1, 2009. Early
adoption is not permitted, with no impact on its financial statements.
In October 2009, the FASB issued Accounting Standards Update No.
2009-13 for Revenue Recognition - Multiple Deliverable Revenue
Arrangements (Subtopic 605-25) "Subtopic". This accounting standard
update establishes the accounting and reporting guidance for
arrangements under which the vendor will perform multiple revenue
generating activities. Vendors often provide multiple products or
services to their customers. Those deliverables often are provided at
different points in time or over different time periods. Specifically,
this Subtopic addresses how to separate deliverables and how to
measure and allocate arrangement consideration to one or more units of
accounting. The amendments in this guidance will affect the accounting
and reporting for all vendors that enter into multiple-deliverable
arrangements with their customers when those arrangements are within
the scope of this Subtopic. This Statement is effective for fiscal
years beginning on or after June 15, 2010. Earlier adoption is
permitted. If a vendor elects early adoption and the period of
adoption is not the beginning of the entity's fiscal year, the entity
will apply the amendments under this Subtopic retrospectively from the
beginning of the entity's fiscal year. The presentation and disclosure
requirements shall be applied retrospectively for all periods
presented. Currently, Management believes this Statement will have no
impact on the financial statements of the Company once adopted.
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.
NOTE 5 - SUBSEQUENT EVENTS
The Company has evaluated subsequent events through February 8, 2010,
the date the financial statements were issued, and has concluded that
no recognized or nonrecognized subsequent events have occurred since
the quarter ended December 31, 2009.
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 December 31, 2009, resulted in a net loss of
$2,944. The Basic Loss per Share for the three month period ended December 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 December 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 December 31, 2009 or 2008.
OPERATING RESULTS - OPERATING EXPENSES
Operating expense for the three month period ended December 31, 2009, was
$1,981. For the quarter ended December 31, 2009, the Company's operating
expenses were entirely related to accounting expenses and legal fees.
- The Company's accounting expenses decreased $2,962 for the three month
period ended December 31, 2009 compared to the same three month period
ended December 31, 2008. The Company incurred $1,343 in accounting fees in
the three month period ended December 31, 2009, and incurred $4,305 in the
three month period December 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 same
period in the prior year.
- The Company's legal fees were $638 for the three month period ended
December 31, 2009 and $639 for the three month period ended December 31,
2008.
7
OPERATING RESULTS - INTEREST EXPENSES
The Company incurred $963 in interest expense in the three month period
ended December 31, 2009. In the three month period ended December 31, 2008, the
Company incurred $817 in interest expense. The increase in interest expense is
due to higher notes payable balances from loans obtained from the Company's
shareholders.
LIQUIDITY
As of December 31, 2009, the Company had $17,543 in current liabilities and
$36,789 in long-term debt.
The Company has a zero cash balance as of December 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 December 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:02/08/10 /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:02/08/10 /S/SHARLENE DOOLIN
Sharlene Doolin, Principal Financial Officer,
Secretary and Director
9