Filed Pursuant to Rule 424(b)(1)
Registration No. 333-172010
PROSPECTUS
DATAMILL MEDIA CORP.
SHARES OF COMMON STOCK
1,000,000 SHARES MINIMUM - 5,000,000 SHARES MAXIMUM
Our common stock is not presently quoted on the Over the Counter Bulletin
Board or traded in any market. In the event that we sell at least the minimum
number of shares in this offering, of which there is no assurance, we intend to
have our shares of common stock quoted on the Over the Counter Bulletin Board
operated by the Financial Industry Regulatory Authority ("FINRA"). However,
there is no assurance that our shares will ever be quoted on the Over the
Counter Bulletin Board.
We are offering a minimum of 1,000,000 up to a maximum of 5,000,000 shares
of our common stock in a direct public offering on a best efforts basis, without
any involvement of underwriters or broker-dealers. The offering price is $0.02
per share. In the event that 1,000,000 shares are not sold within 270 days, all
money received by us will be promptly returned to you without interest or
deduction of any kind. In the event that the maximum of 5,000,000 shares of our
common stock are sold prior to 270 days after the date of our prospectus, we
will terminate this offering. The maximum time during which shares may be sold
pursuant to this offering is 270 days from the date of our prospectus. We will
not extend this offering beyond such 270 day period.
If at least 1,000,000 shares are sold within 270 days, all money received
will be retained by us and there will be no refund. Funds will be held in a
separate bank account at Chase Bank. Sold securities are deemed securities which
have been paid for with collected funds prior to expiration of this offering.
Collected funds are deemed funds that have been paid by the drawee bank. The
foregoing account is not an escrow, trust or similar account. It is merely a
separate account under our control where we have segregated your funds. As a
result, creditors could attach the funds.
There is no minimum purchase requirement and there are no arrangements to
place the funds in an escrow, trust, or similar account.
Our common stock will be sold on our behalf by Vincent Beatty and Thomas
Hagan, our sole officers and directors. Neither of our officers or directors
will receive any commissions or proceeds from the offering for selling shares on
our behalf.
INVESTING IN OUR COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS" STARTING
AT PAGE 7.
Offering
Price Expenses Proceeds to Us
----- -------- --------------
Per Share - Minimum $ 0.02 $ $
Per Share - Maximum $ 0.02 $ $
Minimum $ 20,000 $ 5,000 $15,000
Maximum $100,000 $10,000 $90,000
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is May 12, 2011.
TABLE OF CONTENTS
Page No.
--------
Summary of Prospectus 3
Risk Factors 7
Use of Proceeds 10
Determination of Offering Price 11
Dilution of the Price You Pay for Your Shares 11
Plan of Distribution; Terms of the Offering 12
Management's Discussion and Analysis of Financial Condition and
Plan of Development Stage Activities 15
Business 18
Management 22
Executive Compensation 24
Principal Stockholders 24
Description of Securities 25
Certain Transactions 27
Litigation 27
Experts 27
Legal Matters 27
Financial Statements 27
2
SUMMARY OF OUR OFFERING
OUR BUSINESS
We had been originally incorporated under the laws of Canada on January 15,
1990, under the name "Creemore Star Printing, Inc." We changed our name on June
15, 2003 to "Smitten Press: Local Lore and Legends, Inc." We domesticated in the
State of Nevada by filing Articles of Incorporation in Nevada on May 8, 2007,
and we were incorporated in the State of Nevada on May 8, 2007, as Smitten
Press: Local Lore and Legends, Inc. On April 30, 2010, our Board of Directors
approved a change in our name to DataMill Media Corp. ("Company"), effective at
the close of business on June 30, 2010. On April 30, 2010, our Board of
Directors approved a reverse-split of our Common Stock on the basis of one new
share of Common Stock for each one hundred shares of Common Stock held of record
at the close of business on June 30, 2010. These corporate actions were ratified
on April 30, 2010 by holders of a majority of the shares of Common Stock of the
Company acting on written consent. We are a development stage company. We are a
"shell company" as defined in Rule 405 of the Securities Act of 1933, as
amended.
We are a management consulting firm that plans to educate and assist small
businesses to improve their management, corporate governance, regulatory
compliance and other business processes, with a focus on capital market
participation. We intend to generate revenues, with our two or possibly three
employees, by providing consulting and educational services to primarily private
companies seeking to become publicly traded companies.
We have limited business operations and have achieved losses since
inception. For the year ended December 31, 2010, we had no revenue and incurred
losses from operations of $67,747. As of December 31, 2010, our assets consisted
of $370 in cash. We have been issued a going concern opinion by our independent
registered public accounting firm and rely upon the sale of our securities and
loans from our officers and directors to fund operations.
On January 5, 2011, an unaffiliated entity loaned us $25,000 in exchange
for a promissory note for such sum. The promissory note bears interest at the
rate of 5% per year and will be due and payable on July 5, 2011. The promissory
note requires the Company to issue 75,000 shares of restricted common stock to
the lender in lieu of accrued interest on the note when the note is paid. In
addition, Vincent Beatty, our President, personally guaranteed payment and
performance of the note and pledged 201,000 shares of Datamill restricted common
stock owned by Mr. Beatty as collateral to secure this $25,000 loan and to
secure his guaranty of the loan.
Our monthly "burn rate," the amount of expenses we expect to incur on a
monthly basis, is approximately $2,000 for a total of $18,000 for the maximum of
270 days during which this offering will be made. We have relied, and will
continue to rely, on loans from our officers and directors to fund operations.
However, we do not have any written agreements with our officers and directors
to fund our operating expenses during the 270 days during which this offering
will be made.
In order to complete our plan of operation, we estimate that $90,000 in
funds will be required. The source of such funds is anticipated to be the net
proceeds from this offering. If we fail to generate $90,000 from this offering,
we may not be able to fully carry out our plan of operations.
Assuming we raise the minimum amount of $20,000 in this offering, we
believe we can satisfy our cash requirements during the next 12 months and begin
to implement our business plan at a slower pace than if we raise the maximum
amount in this offering. The minimum amount raised will allow us to develop our
website to an operational extent, conduct sufficient marketing, purchase a
minimal amount of inventory (electronic and hard copies of instruction manuals,
3
instruction booklets and example templates relating to the consulting and
educational services we intend to provide) and computer equipment to implement
our business plan and begin offering and selling our products on a smaller scale
than if we raise the maximum amount in this offering. In addition, if we only
raise the minimum amount in this offering, we will not be able to offer any
consulting services and we will not have the additional employee required to
implement our business plan as quickly as possible.
We cannot assure you that we will be able to raise the maximum $100,000 in
offering proceeds in this offering. If we do not raise the maximum $100,000 in
this offering, then we will not be able to provide our consulting services.
Assuming we raise the maximum amount of $100,000 in this offering, we believe we
can fully implement our business plan, finalize our product research and
development, purchase the required computer equipment and stock our inventory
with the electronic and hard copies of the instruction manuals, instruction
booklets and example templates relating to the consulting and educational
services we intend to provide, including, but not limited to corporate
management, corporate governance, regulatory compliance and various business
processes. Further, we do not expect significant changes in the number of
employees. If we cannot generate sufficient revenues to continue operations, we
will suspend or cease operations. Upon completion of our public offering, our
goal is to expand and market our operations.
We believe that the following steps can be accomplished if we only raise
the minimum of $20,000 in this offering:
Website Development $ 3,000
Computer Purchase $ 1,000
Inventory Purchase $ 2,000
Marketing and Advertising $ 1,000
We believe the above steps will be accomplished within 30 days of our
receipt of proceeds equal to the minimum of $20,000 from this offering.
We believe that the following additional steps can only be accomplished if
we raise the maximum of $100,000 in this offering:
Enhancement of our Website $ 2,500
Additional Computer Purchases $ 8,000
Additional Inventory Purchases $40,000
Hire one additional employee $10,000
Hire second additional employee $10,000
We believe the proceeds from the offering will allow us to operate for
twelve months, whether the minimum or maximum is raised. However, the extent of
our operations will be less if we only raise the minimum.
DUE TO FINANCIAL CONSTRAINTS, THERE ARE MATERIAL WEAKNESSES IN OUR INTERNAL
CONTROLS AND DISCLOSURE CONTROLS AND PROCEDURES.
As of December 31, 2010, we carried out an evaluation required by Rule
13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934 ("Exchange Act")
under the supervision and with the participation of our management, including
our Principal Executive Officer and Principal Financial Officer, of the
effectiveness of the design and operation of our disclosure controls and
procedures.
Disclosure controls and procedures are designed with the objective of
ensuring that (i) information required to be disclosed in an issuer's reports
filed under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the SEC rules and forms and (ii)
information is accumulated and communicated to management, including our
Principal Executive Officer and Principal Financial Officer, as appropriate to
allow timely decisions regarding required disclosures.
The evaluation of our disclosure controls and procedures included a review
of our objectives and processes and effect on the information generated for use
in this Report. This type of evaluation is done quarterly so that the
conclusions concerning the effectiveness of these controls can be reported in
our periodic reports filed with the SEC. We intend to maintain these controls as
processes that may be appropriately modified as circumstances warrant.
4
Based upon such evaluation, our Chief Executive Officer and Chief Financial
Officer concluded that as of such date, our disclosure controls and procedures
were not effective at the reasonable assurance level because, due to financial
constraints, the Company does not maintain a sufficient complement of personnel
with an appropriate level of technical accounting knowledge, experience and
training in the application of generally accepted accounting principles
commensurate with our financial accounting and reporting requirements. There
have been no changes in our internal control over financial reporting identified
in connection with the evaluation that occurred during our last fiscal quarter
that have materially affected, or that are reasonably likely to materially
affect, our internal control over financial reporting. In the event that we
receive sufficient funds for internal operational purposes, we plan to retain
the services of additional internal management staff to provide assistance to
our current management in monitoring and maintaining our internal controls and
procedures.
Our business office is located at 1205 Hillsboro Mile, Suite 203, Hillsboro
Beach, FL 33062, and our telephone number is (954) 876-1181. Our website is
www.datamillmedia.com. Our fiscal year end is December 31.
Management or affiliates of our Company will not purchase shares in this
offering in order to reach the minimum.
THE OFFERING
Following is a brief summary of this offering:
Securities being offered A minimum of 1,000,000 shares of common stock
and a maximum of 5,000,000 shares of common
stock, par value $0.001.
Offering price per share $0.02
Offering period Our shares are being offered for a period not
to exceed 270 days.
Net proceeds to us Approximately $15,000 assuming the minimum
number of shares are sold. Approximately
$90,000 assuming the maximum number of shares
is sold.
Use of proceeds We will use the proceeds to pay for offering
expenses, the implementation of our business
plan, and for working capital.
Number of shares outstanding
before the offering 10,325,000
Number of shares outstanding
after the offering if all of
the shares are sold 15,325,000
5
SUMMARY FINANCIAL DATA
The summary statements of operations data for the years ended December 31,
2010 and 2009 and the summary balance sheet data as of December 31, 2010 and
2009 are derived from our audited financial statements included elsewhere in
this prospectus.
You should read the summary financial data below together with
"Management's Discussion and Analysis of Financial Condition and Plan of
Development Stage Activities" and our financial statements and the related notes
included elsewhere in this prospectus.
STATEMENTS OF OPERATIONS DATA
For the Period
From June 1, 2003
(Inception) to
Year Ended December 31, December 31, 2010
2010 2009 (Unaudited)
----------- ----------- -----------
Revenue $ -- $ -- $ --
Operating loss (67,747) (538) (1,133,616)
Other Expense -- -- (3,677)
Net loss $ (67,747) $ (538) $(1,137,293)
NET LOSS PER SHARE
Basic and diluted $ (0.02) $ (0.00) $ (1.55)
WEIGHTED-AVERAGE SHARES:
Basic and diluted 3,914,041 325,000 738,564
BALANCE SHEET DATA
December 31,
2010 2009
----------- -----------
Total assets $ 370 $ --
Total current liabilities $ 151,517 $ 93,400
Total stockholders'deficit $ (151,147) $ (93,400)
6
RISK FACTORS
Please consider the following risk factors before deciding to invest in our
common stock.
RISKS ASSOCIATED WITH OUR COMPANY
BECAUSE OUR AUDITORS HAVE ISSUED A GOING CONCERN OPINION, THERE IS
SUBSTANTIAL UNCERTAINTY THAT WE WILL CONTINUE OPERATIONS IN WHICH CASE YOU COULD
LOSE YOUR INVESTMENT.
Our auditors have issued a going concern opinion. This means that there is
substantial doubt that we can continue as an ongoing business for the next
twelve months. The financial statements do not include any adjustments that
might result from the uncertainty about our ability to continue in business. As
such we may have to cease operations and you could lose your investment.
WE LACK AN OPERATING HISTORY AND HAVE LOSSES THAT WE EXPECT TO CONTINUE
INTO THE FUTURE. THERE IS NO ASSURANCE OUR FUTURE OPERATIONS WILL RESULT IN
PROFITABLE REVENUES. IF WE CANNOT GENERATE SUFFICIENT REVENUES TO OPERATE
PROFITABLY, WE WILL CEASE OPERATIONS AND YOU WILL LOSE YOUR INVESTMENT.
We were incorporated in Nevada on May 8, 2007, and we have recently started
our business operations. We have no operating history upon which an evaluation
of our future success or failure can be made. Our net loss since inception is
$1,137,293 of which $92,510 is for general and administrative expenses, $200,609
is for professional fees, $840,427 is for officer compensation, and $3,677 is
for loss on foreign currency exchange. Our ability to achieve and maintain
profitability and positive cash flow is dependent, among other things, upon:
* completion of this offering;
* our ability to attract customers who will buy our services from us;
and
* our ability to generate revenues through the sale of our services.
Based upon current plans, we expect to incur operating losses in future
periods since we will be incurring expenses and not generating revenues. We
cannot guarantee that we will be successful in generating revenues in the
future. Failure to generate revenues will cause you to lose your investment.
We are solely dependent upon the funds to be raised in this offering to
operate our business, the proceeds of which may be insufficient to achieve our
business plan. If we need additional funds and are unable to raise them we will
have to terminate our operations.
We have recently started our business operations. We need the proceeds from
this offering to continue our operations. If the minimum of $20,000 is raised,
this amount will enable us, after paying the expenses of this offering, to
operate for one year. If we need additional funds and are unable to raise the
money, we will have to cease operations.
IF WE DO NOT MAKE A PROFIT, WE MAY HAVE TO SUSPEND OR CEASE OPERATIONS.
Since we are small company and do not have much capital, we must limit
marketing our services. The sale of services is how we will initially generate
revenues. Because we will be limiting our marketing activities, we may not be
able to attract enough customers to operate profitably. If we cannot operate
profitably, we may have to suspend or cease operations.
AS A RESULT OF OUR INTENSELY COMPETITIVE INDUSTRY, WE MAY NOT GAIN ENOUGH
MARKET SHARE TO BE PROFITABLE.
The consulting business is intensely competitive and due to our small size
and limited resources, we may be at a competitive disadvantage, especially as a
public company. There are numerous firms offering consulting services similar to
ours. Many of our competitors have proven track records, and substantial human
7
and financial resources, as opposed to our Company who has limited human
resources and little cash. Also, the financial burden of being a public company,
which will cost us between $35,000 and $50,000 per year in auditing fees and
legal fees to comply with our reporting obligations under the Securities
Exchange Act of 1934 and compliance with the Sarbanes-Oxley Act of 2002 will
strain our finances and stretch our human resources to the extent that we may
have to price our consulting services higher than our competitors just to cover
the costs of being a public company.
WE ARE VULNERABLE TO THE CURRENT ECONOMIC CRISIS WHICH MAY NEGATIVELY
AFFECT OUR PROFITABILITY AND ABILITY TO CARRY OUT OUR BUSINESS PLAN.
We are currently in a severe worldwide economic recession. Runaway deficit
spending by the United States government and other countries further exacerbates
the United States and worldwide economic climate and may delay or possibly
deepen the current recession. Currently, a lot of economic indicators such as
rising gasoline and commodity prices, suggest higher inflation, dwindling
consumer confidence and substantially higher taxes. Demand for the services we
offer tends to decline during recessionary periods when disposable revenue is
lower and may impact sales of our services. In addition, sudden disruptions in
business conditions as a result of a terrorist attack similar to the events of
September 11, 2001, including further attacks, retaliation and the threat of
further attacks or retaliation, war, civil unrest in the Middle East, adverse
weather conditions or other natural disasters, such as Hurricane Katrina,
pandemic situations or large scale power outages can have a short term or,
sometimes, long term impact on spending. The worldwide recession is placing
severe constraints on the ability of all companies, particularly smaller ones,
to raise capital, borrow money, operate effectively and profitably and to plan
for the future.
BECAUSE OUR TWO OFFICERS AND DIRECTORS WILL ONLY BE DEVOTING LIMITED TIME
TO OUR OPERATIONS, OUR OPERATIONS MAY BE SPORADIC WHICH MAY RESULT IN PERIODIC
INTERRUPTIONS OR SUSPENSIONS OF OPERATIONS. THIS ACTIVITY COULD PREVENT US FROM
ATTRACTING CUSTOMERS AND RESULT IN A LACK OF REVENUES THAT MAY CAUSE US TO
SUSPEND OR CEASE OPERATIONS.
Our two officers and directors will only be devoting limited time to our
operations. Because they will only be devoting limited time to our operations,
our operations may be sporadic and occur at times which are convenient to them.
As a result, operations may be periodically interrupted or suspended which could
result in a lack of revenues and a possible cessation of operations.
DUE TO FINANCIAL CONSTRAINTS, THERE ARE MATERIAL WEAKNESSES IN OUR INTERNAL
CONTROLS AND DISCLOSURE CONTROLS AND PROCEDURES.
As of December 31, 2010, we carried out an evaluation required by Rule
13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934 (the "Exchange
Act") under the supervision and with the participation of our management,
including our Principal Executive Officer and Principal Financial Officer, of
the effectiveness of the design and operation of our disclosure controls and
procedures.
Disclosure controls and procedures are designed with the objective of
ensuring that (i) information required to be disclosed in an issuer's reports
filed under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the SEC rules and forms and (ii)
information is accumulated and communicated to management, including our
Principal Executive Officer and Principal Financial Officer, as appropriate to
allow timely decisions regarding required disclosures.
The evaluation of our disclosure controls and procedures included a review
of our objectives and processes and effect on the information generated for use
in this Report. This type of evaluation is done quarterly so that the
conclusions concerning the effectiveness of these controls can be reported in
our periodic reports filed with the SEC. We intend to maintain these controls as
processes that may be appropriately modified as circumstances warrant.
8
Based upon such evaluation, such person concluded that as of such date, our
disclosure controls and procedures were not effective at the reasonable
assurance level because, due to financial constraints, the Company does not
maintain a sufficient complement of personnel with an appropriate level of
technical accounting knowledge, experience and training in the application of
generally accepted accounting principles commensurate with our financial
accounting and reporting requirements. There have been no changes in our
internal control over financial reporting identified in connection with the
evaluation that occurred during our last fiscal quarter that have materially
affected, or that are reasonably likely to materially affect, our internal
control over financial reporting. In the event that we receive sufficient funds
for internal operational purposes, we plan to retain the services of additional
internal management staff to provide assistance to our current management in
monitoring and maintaining our internal controls and procedures.
RISKS ASSOCIATED WITH THIS OFFERING:
BECAUSE WE DO NOT HAVE AN ESCROW OR TRUST ACCOUNT FOR YOUR SUBSCRIPTION, IF
WE FILE FOR BANKRUPTCY PROTECTION OR ARE FORCED INTO BANKRUPTCY, OR A CREDITOR
OBTAINS A JUDGMENT AGAINST US AND ATTACHES YOUR SUBSCRIPTION, YOU WILL LOSE YOUR
INVESTMENT.
Your funds will not be placed in an escrow or trust account. Accordingly,
if we file for bankruptcy protection or a petition for involuntary bankruptcy is
filed by creditors against us, your funds will become part of the bankruptcy
estate and administered according to bankruptcy laws. If a creditor sues us and
obtains a judgment against us, the creditor could garnish the bank account and
take possession of the subscriptions. As such, if the minimum conditions of this
offering are not satisfied, it is possible that a creditor could attach your
subscription which could preclude or delay the return of money to you. If that
happens, you will lose your investment and your funds will be used to pay
creditors.
BECAUSE VINCENT BEATTY, OUR PRESIDENT, WILL OWN 90.1% OF OUR TOTAL
OUTSTANDING COMMON STOCK IF THE MINIMUM AMOUNT OF THE OFFERING IS SOLD AND 66.6%
OF OUR TOTAL OUTSTANDING COMMON STOCK IF THE MAXIMUM AMOUNT OF THE OFFERING IS
SOLD, MR. BEATTY WILL RETAIN CONTROL OF US AND WILL BE ABLE TO DECIDE WHO WILL
BE DIRECTORS AND YOU MAY NOT BE ABLE TO ELECT ANY DIRECTORS WHICH COULD DECREASE
THE PRICE AND MARKETABILITY OF OUR SHARES.
Even if we sell all 5,000,000 shares of common stock in this offering,
Vincent Beatty, our President, will own 66.6% of the total outstanding common
stock; if the minimum amount of the offering is sold he will own 90.1% of the
total outstanding common stock. As a result, after completion of this offering,
regardless of the number of shares we sell, Vincent Beatty, our President, will
own the vast majority of the shares of our Common Stock and will be able to
elect all of our directors and control our operations, which could decrease the
price and marketability of our shares.
OUR SHAREHOLDERS MAY BE DILUTED SIGNIFICANTLY THROUGH OUR EFFORTS TO OBTAIN
FINANCING, FUND OUR OPERATIONS AND SATISFY OUR OBLIGATIONS THROUGH ISSUANCE OF
ADDITIONAL SHARES OF OUR COMMON STOCK.
We have no committed source of financing. We will likely have to issue
additional shares of our Common Stock to fund our operations and to implement
our plan of operation. Wherever possible, our board of directors will attempt to
use non-cash consideration to satisfy obligations. In many instances, we believe
that the non-cash consideration will consist of restricted shares of our common
stock. Our board of directors has authority, without action or vote of the
shareholders, to issue all or part of the 139,675,000 authorized, but unissued,
shares of our common stock. Future issuances of shares of our common stock will
result in dilution of the ownership interests of existing shareholders, may
further dilute common stock book value and that dilution may be material.
BECAUSE THERE IS NO PUBLIC TRADING MARKET FOR OUR COMMON STOCK, YOU MAY NOT
BE ABLE TO RESELL YOUR STOCK.
Our Common Stock is not presently quoted on the Over the Counter Bulletin
Board or traded in any market. Therefore, you may not be able to resell your
stock.
9
BECAUSE THE SEC IMPOSES ADDITIONAL SALES PRACTICE REQUIREMENTS ON BROKERS
WHO DEAL IN OUR SHARES THAT ARE PENNY STOCKS, SOME BROKERS MAY BE UNWILLING TO
TRADE THEM. THIS MEANS THAT YOU MAY HAVE DIFFICULTY RESELLING YOUR SHARES AND
THIS MAY CAUSE THE PRICE OF OUR SHARES TO DECLINE.
Our shares would be classified as penny stocks and are covered by Section
15(g) of the Securities Exchange Act of 1934 and the rules promulgated
thereunder which impose additional sales practice requirements on
brokers/dealers who sell our securities in this offering or in the aftermarket.
For sales of our securities, the broker/dealer must make a special suitability
determination and receive from you a written agreement prior to making a sale
for you. Because of the imposition of the foregoing additional sales practices,
it is possible that brokers will not want to make a market in our shares. This
could prevent you from reselling your shares and may cause the price of our
shares to decline.
FINRA SALES PRACTICE REQUIREMENTS MAY LIMIT A STOCKHOLDER'S ABILITY TO BUY
AND SELL OUR STOCK.
The FINRA has adopted rules that require that in recommending an investment
to a customer, a broker-dealer must have reasonable grounds for believing that
the investment is suitable for that customer. Prior to recommending speculative
low priced securities to their non-institutional customers, broker-dealers must
make reasonable efforts to obtain information about the customer's financial
status, tax status, investment objectives and other information. Under
interpretations of these rules, FINRA believes that there is a high probability
that speculative low priced securities will not be suitable for at least some
customers. FINRA requirements make it more difficult for broker-dealers to
recommend that their customers buy our common stock, which may have the effect
of reducing the level of trading activity and liquidity of our common stock.
Further, many brokers charge higher transactional fees for penny stock
transactions. As a result, fewer broker-dealers may be willing to make a market
in our common stock, which may limit your ability to buy and sell our stock.
USE OF PROCEEDS
Our offering is being made in a direct public offering, without any
involvement of underwriters or broker-dealers, on a 1,000,000 common shares
minimum, 5,000,000 common shares maximum basis. The table below sets forth the
use of proceeds if 1,000,000 or 5,000,000 common shares of the offering are
sold.
Minimum Maximum
---------- ----------
Number of common shares 1,000,000 5,000,000
---------- ----------
Gross proceeds $ 20,000 $ 100,000
Offering expenses 5,000 10,000
Net proceeds 15,000 90,000
The net proceeds will be used as follows:
Website development 3,000 3,000
Website enhancement -- 2,500
Marketing and advertising 1,000 3,000
Product Inventory 2,000 42,000
Computer Equipment 1,000 9,000
Hiring one additional employee -- 10,000
Hire a second additional employee -- 10,000
Audit, accounting and filing fees 5,500 5,500
Other expenses 2,500 5,000
---------- ----------
TOTAL $ 15,000 $ 90,000
========== ==========
Total offering expenses of $5,000 (minimum) and $10,000 (maximum) to be
paid from the proceeds of the offering are for legal fees and auditing fees, and
printing costs related to this offering. No other expenses of the offering will
be paid from the proceeds. Approximately $24,000 of expenses associated with
this offering have been paid from loans received by the Company.
10
We believe we can develop our basic website for $3,000 and enhance the
website for an additional $2,500. We estimate that our initial basic product
inventory requirements will cost $2,000. Product inventory will consist of
electronic and hard copies of the instruction manuals, instruction booklets and
example templates relating to the consulting and educational services we intend
to provide, including, but not limited to corporate management, corporate
governance, regulatory compliance and various business processes. However, we
will not be able to offer our consulting services unless we raise the maximum
$100,000 in offering proceeds in this offering.
We estimate that our initial basic computer equipment requirements will
cost $1,000.
We intend to hire one additional employee to handle administrative duties
and one additional employee to perform marketing, provided we raise the maximum
amount of the offering.
We estimate our auditing and accounting fees to be $5,500 during the next
twelve months.
We have allocated between $2,500 and $5,000 for additional unforeseen
expenses which may arise as a result of initiating our operations.
We believe the proceeds from the offering will allow us to operate for
twelve months, whether the minimum or maximum amount is raised. We believe the
proceeds of this offering will last twelve months, including filing reports with
the Securities and Exchange Commission, as well as the business activities
contemplated by our business plan.
DETERMINATION OF OFFERING PRICE
The price of the shares we are offering was arbitrarily determined in order
for us to raise a minimum of $20,000 and a maximum of $100,000 in this offering.
The offering price bears no relationship to our assets, earnings, book value or
other criteria of value. Among the factors we considered were:
* our lack of operating history;
* the proceeds to be raised by the offering;
* the amount of capital to be contributed by purchasers in this offering
in proportion to the amount of stock to be retained by our existing
stockholder; and,
* our relative cash requirements.
DILUTION OF THE PRICE YOU PAY FOR YOUR SHARES
Dilution represents the difference between the offering price and the net
tangible book value per share immediately after completion of this offering. Net
tangible book value is the amount that results from subtracting total
liabilities and intangible assets from total assets. Dilution arises mainly as a
result of our arbitrary determination of the offering price of our shares being
offered. Dilution of the value of our shares you purchase is also a result of
the lower book value of our shares held by our existing stockholders.
As of December 31, 2010, the net tangible book value of our shares of
common stock was ($151,147) or approximately ($0.01) per share based upon
10,325,000 shares outstanding.
IF THE MAXIMUM NUMBER OF THE SHARES ARE SOLD:
Upon completion of this offering, in the event all 5,000,000 of our shares
are sold, the net tangible book value of the 15,325,000 shares to be outstanding
will be ($61,147) or approximately $0.00 per share. The net tangible book value
of our shares held by our existing stockholder will be increased by $0.01 per
share without any additional investment on their part. You will incur an
immediate dilution from $0.02 per share to $0.00 per share
After completion of this offering, if 5,000,000 shares are sold, investors
in this offering will collectively own 32.6% of the total number of outstanding
shares for which they will have made an aggregate cash investment of $100,000,
or $0.02 per share. Our existing stockholders will own 67.4% of the total number
of outstanding shares for which they have made cash contributions totaling
$10,000 or approximately $0.001 per share.
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IF THE MINIMUM NUMBER OF THE SHARES ARE SOLD:
Upon completion of this offering, in the event 1,000,000 of the shares are
sold, the net tangible book value of the 11,325,000 shares then outstanding will
be ($136,147), or approximately ($0.01) per share. The net tangible book value
of our shares held by our existing stockholders will be increased by $0.00 per
share without any additional investment on their part. Persons who invest in
this offering will incur an immediate dilution from $0.02 per share to ($0.01)
per share.
After completion of this offering, if 1,000,000 shares are sold, investors
in this offering will collectively own approximately 8.8% of the total number of
outstanding shares for which they will have made an aggregate cash investment of
$20,000, or $0.02 per share. Our existing stockholders will own approximately
91.2% of the total number of outstanding shares for which they have made cash
contributions totaling $10,000 or approximately $0.001 per share.
PLAN OF DISTRIBUTION; TERMS OF THE OFFERING
We are offering up to 5,000,000 shares of common stock on a best efforts
basis, 1,000,000 shares minimum, 5,000,000 shares maximum. The offering price is
$0.02 per share. Funds from this offering will be placed in a separate bank
account at Chase Bank. The funds will be maintained in a separate bank until we
receive a minimum of $20,000 at which time we will remove those funds and use
the same as set forth in the Use of Proceeds section of this Prospectus. This
account is not an escrow, trust or similar account. Your subscription will only
be deposited in a separate bank account under our name. As a result, if we are
sued for any reason and a judgment is rendered against us, your subscription
could be seized in a garnishment proceeding and you could lose your investment,
even if we fail to raise the minimum amount in this offering. As a result, there
is no assurance that your funds will be returned to you if the minimum offering
is not reached. Any funds received by us thereafter will be immediately used by
us. If we do not receive the minimum amount of $20,000 within 270 days of the
effective date of our registration statement, all funds will be promptly
returned to you without a deduction of any kind. During the 270 day period, no
funds will be returned to you. You will only receive a refund of your
subscription if we do not raise a minimum of $20,000 within the 270 day period
referred to above. There are no broker-dealers or finders involved in our
distribution. Officers, directors, affiliates or anyone involved in marketing
our shares will not be allowed to purchase shares in the offering. You will not
have the right to withdraw your funds during the offering. You will only have
the right to have your funds returned if we do not raise the minimum amount of
the offering or if there is a material change in the terms of the offering. The
following bullet points contain some, but not all, of the material changes that
would entitle you to a refund of your money:
* a change in the offering price;
* a change in the minimum sales requirement;
* a change to allow sales to affiliates in order to meet the minimum
sales requirement; or
* a change in the amount of proceeds necessary to release the funds held
in the separate bank account.
If any material changes to this offering occur, such changes will be
reflected in a post-effective amendment.
We will sell the shares in this offering through our two officers and
directors, who will receive no commission from the sale of any shares. They will
not register as a broker-dealer under section 15 of the Securities Exchange Act
of 1934 in reliance upon Rule 3a4-1. Rule 3a4-1 sets forth those conditions
under which a person associated with an issuer may participate in the offering
of the issuer's securities and not be deemed to be a broker-dealer. The
conditions are that:
1. The person is not statutorily disqualified, as that term is defined in
Section 3(a)(39) of the Act, at the time of his or her participation; and,
2. The person is not compensated in connection with his or her
participation by the payment of commissions or other remuneration based either
directly or indirectly on transactions in securities;
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3. The person is not at the time of his or her participation, an associated
person of a broker-dealer; and,
4. The person meets the conditions of Paragraph (a)(4)(ii) of Rule 3a4-1 of
the Exchange Act, in that he or she (A) primarily performs, or is intended
primarily to perform at the end of the offering, substantial duties for or on
behalf of the issuer otherwise than in connection with transactions in
securities; and (B) is not a broker or dealer, or an associated person of a
broker or dealer, within the preceding twelve months; and (C) does not
participate in selling and offering of securities for any issuer more than once
every twelve months other than in reliance on Paragraphs (a)(4)(i) or
(a)(4)(iii).
Our two officers and directors are not statutorily disqualified, are not
being compensated, and are not associated with a broker-dealer. They are and
will continue to be our sole officers and directors at the end of the offering
and have not been during the last twelve months and are not currently a
broker-dealer or associated with a broker-dealer. They will not participate in
selling and offering securities for any issuer more than once every twelve
months.
Only after our registration statement is declared effective by the SEC, do
we intend to advertise, through tombstones, and hold investment meetings in
various states where the offering will be registered. We will not utilize the
Internet to advertise our offering. Our officers and directors will also
distribute the prospectus to potential investors at meetings, to business
associates and to their friends and relatives who are interested in a possible
investment in the offering. No shares purchased in this offering will be subject
to any kind of lock-up agreement.
Management and affiliates thereof will not purchase shares in this offering
to reach the minimum.
We do not have any agreements with underwriters with respect to the sale of
shares in this offering. In the event the Company sells all or part of the
shares offered in this prospectus to or through an underwriter, the maximum
compensation paid to any such underwriter shall be 8%.
SECTION 15(G) OF THE EXCHANGE ACT - PENNY STOCK RULES
The SEC has adopted rules that regulate broker-dealer practices in
connection with transactions in penny stocks. Penny stocks are generally equity
securities with a price of less than $5.00 other than securities registered on
certain national securities exchanges or quoted on the OTC Bulletin Board
system, provided that current price and volume information with respect to
transactions in such securities is provided by the exchange or system. However,
even stocks quoted on the OTC Bulletin Board system can still qualify as penny
stocks. Our Common Stock will more than likely be considered a penny stock.
The penny stock rules require a broker-dealer, prior to a transaction in a
penny stock not otherwise exempt from those rules, deliver a standardized risk
disclosure document prepared by the SEC, which:
* contains a description of the nature and level of risk in the market
for penny stocks in both public offerings and secondary trading;
* contains a description of the broker's or dealer's duties to the
customer and of the rights and remedies available to the customer with
respect to a violation to such duties or other requirements;
* contains a brief, clear, narrative description of a dealer market,
including "BID" and "ASK" prices for penny stocks and the significance
of the spread between the bid and ask price;
* contains a toll-free telephone number for inquiries on disciplinary
actions;
* defines significant terms in the disclosure document or in the conduct
of trading penny stocks; and
* contains such other information and is in such form (including
language, type, size, and format) as the SEC shall require by rule or
regulation.
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The broker-dealer also must provide, prior to effecting any transaction in
a penny stock, the customer:
* with bid and offer quotations for the penny stock;
* the compensation of the broker-dealer and its salesperson in the
transaction;
* the number of shares to which such bid and ask prices apply, or other
comparable information relating to the depth and liquidity of the
market for such stock; and
* monthly account statements showing the market value of each penny
stock held in the customer's account.
In addition, the penny stock rules require that prior to a transaction in a
penny stock not otherwise exempt from those rules; the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser's written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements will have the effect of reducing the trading
activity in the secondary market for our securities because it will be subject
to these penny stock rules. Therefore, security holders may have difficulty
selling those securities.
REGULATION M
Our officers and directors, who will sell the shares, are aware that they
are required to comply with the provisions of Regulation M, promulgated under
the Securities and Exchange Act of 1934, as amended. With certain exceptions,
Regulation M precludes officers and/or directors, sales agents, any
broker-dealers or other person who participate in the distribution of shares in
this offering from bidding for or purchasing, or attempting to induce any person
to bid for or purchase any security which is the subject of the distribution
until the entire distribution is complete.
OFFERING PERIOD AND EXPIRATION DATE
This offering will start on the date that our registration statement is
declared effective by the SEC and continue for a period of 270 days, unless
sooner completed or otherwise terminated by us. We will not accept any money
until our registration statement is declared effective by the SEC.
PROCEDURES FOR SUBSCRIBING
We will not accept any money until our registration statement is declared
effective by the SEC. Once the registration statement is declared effective by
the SEC, if you decide to subscribe for any shares in this offering, you must:
1. Execute and deliver a subscription agreement, a copy of which is
included with the prospectus; and
2. Deliver a check, wire transfer, bank draft or money order to us for
acceptance or rejection.
All checks for subscriptions must be made payable to "DATAMILL MEDIA CORP."
RIGHT TO REJECT SUBSCRIPTIONS
We have the right to accept or reject subscriptions in whole or in part,
for any reason or for no reason. All monies from rejected subscriptions will be
returned immediately by us to the subscriber, without interest or deductions.
Subscriptions for securities will be accepted or rejected within 48 hours after
we receive them.
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND PLAN OF DEVELOPMENT STAGE ACTIVITIES
This section of the prospectus includes a number of forward-looking
statements that reflect our current views with respect to future events and
financial performance. Forward-looking statements are often identified by words
like: believe, expect, estimate, anticipate, intend, project and similar
expressions, or words which, by their nature, refer to future events. You should
not place undue certainty on these forward-looking statements, which apply only
as of the date of this prospectus. These forward-looking statements are subject
to certain risks and uncertainties that could cause actual results to differ
materially from historical results or our predictions.
We are a development stage corporation and have recently started our
business operations, and have not yet generated or realized any revenues.
Our auditors have issued a going concern opinion. This means that our
auditors believe there is substantial doubt that we can continue as an on-going
business for the next twelve months unless we obtain additional capital to pay
our bills. It is our belief that if we only raise the $20,000 minimum in this
offering, such monies will last twelve months. The difference between the
minimum and maximum amount relates to the website development; marketing and
advertising; product inventory; computer equipment; and hiring one employee. In
each case, if we raise the maximum amount, we will devote more funds to the same
in order to enhance the quality of the website and promote our business plan to
potential customers.
PLAN OF DEVELOPMENT STAGE ACTIVITIES
Assuming we raise the minimum amount in this offering, we believe we can
satisfy our cash requirements during the next 12 months months and begin to
implement our business plan at a slower pace than if we raise the maximum amount
in this offering. The minimum amount raised will allow us to develop our website
to an operational extent, conduct sufficient marketing, purchase a minimal
amount of inventory and computer equipment to implement our business plan and
begin offering and selling our products on a smaller scale than if we raise the
maximum amount in this offering. In addition, if we only raise the minimum
amount in this offering, we will not be able to offer any consulting services
and we will not have the additional employee required to implement our business
plan as quickly as possible.
We cannot assure you that we will be able to raise the maximum $100,000 in
offering proceeds in this offering. If we do not raise the maximum $100,000,
then we will not be able to provide our consulting services. Assuming we raise
the maximum amount in this offering, we believe we can fully implement our
business plan, finalize our product research and development, purchase the
required computer equipment and stock our inventory with the electronic and hard
copies of the instruction manuals, instruction booklets and example templates
relating to the consulting and educational services we intend to provide,
including, but not limited to corporate management, corporate governance,
regulatory compliance and various business processes. Further, we do not expect
significant changes in the number of employees. If we cannot generate sufficient
revenues to continue operations, we will suspend or cease operations. Upon
completion of our public offering, our goal is to expand and market our
operations.
We believe that the following steps can be accomplished if we only raise
the minimum of $20,000 in this offering:
Website Development $ 3,000
Computer Purchase $ 1,000
Inventory Purchase $ 2,000
Marketing and Advertising $ 1,000
We believe the above steps will be accomplished within 30 days of our
receipt of proceeds equal to the minimum of $20,000 from this offering.
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We believe that the following additional steps can only be accomplished if
we raise the maximum of $100,000 in this offering:
Enhancement of our Website $ 2,500
Additional Computer Purchases $ 8,000
Additional Inventory Purchases $40,000
Hire one additional employee $10,000
Hire second additional employee $10,000
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
Our financial statements and accompanying notes are prepared in accordance
with generally accepted accounting principles in the United States. Preparing
financial statements requires management to make estimates and assumptions that
affect the reported amounts of assets, liabilities, revenue and expenses. These
estimates and assumptions are affected by management's applications of
accounting policies. Significant estimates in 2010 and 2009 include an estimate
of the deferred tax asset valuation allowance, valuation of stock based
payments, and valuation of contributed services.
In May 2009, the Financial Accounting Standards Board ("FASB") issued an
accounting standard that became part of ASC Topic 855, "Subsequent Events". ASC
Topic 855 establishes general standards of accounting for and disclosure of
events that occur after the balance sheet date but before financial statements
are issued or are available to be issued. ASC Topic 855 sets forth (1) the
period after the balance sheet date during which management of a reporting
entity should evaluate events or transactions that may occur for potential
recognition or disclosure in the financial statements, (2) the circumstances
under which an entity should recognize events or transactions occurring after
the balance sheet date in its financial statements and (3) the disclosures that
an entity should make about events or transactions that occurred after the
balance sheet date. ASC Topic 855 is effective for interim or annual financial
periods ending after June 15, 2009. The adoption of ASC Topic 855 did not have a
material effect on the Company's financial statements.
In June 2009, the FASB issued an accounting standard whereby the FASB
Accounting Standards Codification ("Codification") will be the single source of
authoritative non-governmental United States of America generally accepted
accounting principles ("GAAP"). Rules and interpretive releases of the United
States of America Securities and Exchange Commission ("SEC") under authority of
federal securities laws are also sources of authoritative GAAP for SEC
registrants. ASC Topic 105 is effective for interim and annual periods ending
after September 15, 2009. All existing accounting standards are superseded as
described in ASC Topic 105. All other accounting literature not included in the
Codification is non-authoritative. The Codification has not had a significant
impact on the Company's financial statements.
Other accounting standards that have been issued or proposed by the FASB or
other standards-setting bodies that do not require adoption until a future date
are not expected to have a material impact on the financial statements upon
adoption.
LIMITED OPERATING HISTORY; NEED FOR ADDITIONAL CAPITAL
There is no historical financial information about us upon which to base an
evaluation of our performance. We are in development stage operations and have
not yet generated any revenues from our operations. We cannot guarantee we will
be successful in our business operations. Our business is subject to risks
inherent in the establishment of a new business enterprise, including limited
capital resources and possible cost overruns.
In addition to this offering and although we have no current plans to do
so, we may seek additional equity financing at some future time in order to
obtain the capital required to implement a substantially expanded business plan
which would include an increase in the current services we intend to offer and
expand our customer base to include clients on a global scale.
We have no assurance that future financing will be available to us on
acceptable terms. If financing is not available to us on satisfactory terms, we
may be unable to continue, develop or expand our operations. Equity financing
could result in additional dilution to our existing shareholders.
16
RESULTS OF OPERATIONS FOR ANNUAL PERIODS
YEAR ENDED DECEMBER 31, 2010 COMPARED TO YEAR ENDED DECEMBER 31, 2009
The Company has not had any revenue since its inception on June 1, 2003.
As reflected in the accompanying financial statements, the Company had a
net loss from operations of $67,747 ($0.02 per share) and $538 ($0.00 per
share), respectively, for the years ended December 31, 2010 and 2009.
Operating expenses consist of professional fees, general and administrative
expenses and officer compensation. For the year ended December 31, 2010,
operating expenses of $67,747 consisted 1) professional fees of $41,372 made up
audit fees of $23,916 and legal fees of $17,456, 2) general and administrative
expenses of $16,375 made up of consulting fees of $12,500, filing fees of $3,450
and transfer agency fees of $425. For the year ended December 31, 2009,
operating expenses of $538 consisted of transfer agency fees. The dramatic
increase in operating expenses for the year ended December 31, 2010, as compared
with the year ended December 31, 2009, is a result of the Company's effort to
become current in its reporting requirements. An outside accountant was hired as
a consultant to bring the Company's financial statements current from 2008 and
to prepare the necessary schedules and filings for the audit firm and attorney.
The attorney prepared the necessary filings and reviewed the Company's filings
that required his consent.
LIQUIDITY AND CAPITAL RESOURCES
As reflected in the accompanying financial statements, the Company had a
net loss and net cash used in operations of $67,747 and $51,316, respectively,
for the year ended December 31, 2010, compared to a net loss of $538 and $0 for
the year ended December 31, 2009. The $51,316 of net cash used in operations was
offset by stock based compensation of $10,000 issued to the CEO and an increase
of $6,431 in accounts payable for the year ended December 31, 2010.
The Company had net cash provided by financing activities of $51,686 for
the year ended December 31, 2010, compared to no activity for the year ended
December 31, 2009. The $51,686 of net cash provided by financing activities for
the year ended December 31, 2010 consists of a net amount of $31,686 of loans to
the Company by the CEO, a total of $10,000 loaned to the Company by two note
holders and the sum of $10,000 advanced to the Company by an individual that had
advanced funds previously.
There was no cash used in investing activities for the years ended December
31, 2010 and 2009.
In April 2008, the Company issued 2,500 shares of common stock for
services. The value of the shares issued was not material.
During the years ended December 31, 2007 and 2008, an affiliated company
related to the Company's former chief executive officer through common
ownership, advanced funds of $17,199 and $61,477, respectively, to the Company
for working capital purposes. These advances, totaling $78,676, are reflected as
due to related party on the accompanying December 31, 2010 and 2009 balance
sheets, are non-interest bearing and are payable on demand.
On August 23, 2010, the Company issued 10,000,000 restricted shares of its
common stock to its Chief Executive Officer, Vincent Beatty, for services
rendered. The shares were valued at $0.001 per share, a nominal value as there
was no evidence of fair value, or $10,000 in total and expensed immediately as
compensation.
During the year ended December 31, 2010, the Company received proceeds
totaling $36,686 from the Company's current Chief Executive Officer for general
and administrative expenses and repaid $5,000 of the amount during the same
period. The net amount of $31,686 is reflected as due to related party-officer
on the accompanying December 31, 2010 balance sheet. The Company did not issue a
promissory note to Mr. Beatty for these advances and the Company and Mr. Beatty
have not determined the interest rate or maturity date for paying the loan back.
In September 2010, an individual advanced $10,000 to the Company. The
advance is non-interest bearing and due on demand. This amount is reflected as
advances payable on the accompanying December 31, 2010 balance sheet. The
Company did not issue a note on this transaction and the advance was paid in
full.
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As of December 31, 2010, the Company had two Notes Payable with unrelated
parties. On October 20, 2010, two individuals each loaned the Company $5,000 in
exchange for Promissory Notes for the amounts loaned. The notes, with a term of
one year, are due on October 19, 2011, and in lieu of interest, restricted
shares of the Company's common stock will be issued to the note holders. Upon
maturity, the principal amount loaned of $5,000 is due to each note holder and
an aggregate amount of 30,000 restricted common stock shares will be issued to
the note holders, pursuant to the terms of the notes. The terms of first note
state that 10,000 shares of restricted common stock will be issued to the first
note holder and the terms of the second note state that 20,000 shares of
restricted common stock will be issued to the second note holder. The Company
paid off both the $5,000 notes on March 4, 2011. The Company has not yet issued
the 30,000 shares of restricted stock due to the two lenders.
On January 5, 2011, an unaffiliated entity loaned us $25,000 in exchange
for a promissory note for such sum. The promissory note bears interest at the
rate of 5% per year and will be due and payable on July 5, 2011. The promissory
note requires the Company to issue 75,000 shares of restricted common stock to
the lender in lieu of accrued interest on the note when the note is paid. In
addition, Vincent Beatty, our President, personally guaranteed payment and
performance of the note and pledged 201,000 of his Datamill restricted common
stock owned by Mr. Beatty as collateral to secure this $25,000 loan and to
secure his guaranty of the loan.
During March 2011, Vincent Beatty, our President, loaned $40,000 to the
Company for operating funds to pay on-going expenses, including the repayment of
certain notes payable and advances. The Company did not issue a promissory note
on this transaction and the Company and Mr. Beatty have not determined the
interest rate or maturity date for paying back this loan.
In addition, the Company had an accumulated deficit during development
stage of $1,137,293 and stockholders' deficit of $151,147 at December 31, 2010
and an accumulated deficit during development stage of $1,069,546 and
stockholders' deficit of $93,400 at December 31, 2009.
To meet our need for cash we are attempting to raise money from this
offering. We believe that we will be able to raise enough money through this
offering to begin operations, but we cannot guarantee that once we begin
operations we will stay in business after operations have commenced. If we are
unable to successfully attract customers to utilize our services, we may use up
the proceeds from this offering and will need to find alternative sources, like
a second public offering, a private placement of securities, or loans from our
officers or others in order for us to continue our operations. At present, we
have not made any arrangements to raise additional capital, other than through
this offering.
Although we do not have any written agreements with our officers and
directors to loan us money, Vincent Beatty has verbally expressed his
willingness to loan us money for our operations until this offering has been
completed or until the offering period has expired. If we need additional
capital and cannot raise it we will either have to suspend operations until we
do raise the capital or cease operations entirely. It is our belief that the
amount raised in this offering will last twelve months. Other than as described
in this paragraph, we have no other financing plans.
As of the date of this prospectus, we have yet to generate any revenues
from our business operations.
As of December 31, 2010, our total assets were $370, comprised of cash, and
our total liabilities were $151,517.
BUSINESS
GENERAL
We had been originally incorporated under the laws of Canada on January 15,
1990, under the name "Creemore Star Printing, Inc." We changed our name on June
15, 2003 to "Smitten Press: Local Lore and Legends, Inc." We domesticated in the
State of Nevada by filing Articles of Domestication in Nevada on May 8, 2007,
and we were incorporated in the State of Nevada on May 8, 2007 as Smitten Press:
Local Lore and Legends, Inc. On April 30, 2010, our Board of Directors approved
a change in our name to DataMill Media Corp. effective at the close of business
on June 30, 2010. On April 30, 2010, our Board of Directors approved a
reverse-split of our Common Stock on the basis of one new share of Common Stock
for each one hundred shares of Common Stock held of record at the close of
business on June 30, 2010. These corporate actions were ratified on April 30,
2010 by holders of a majority of the shares of Common Stock of the Company
acting on written consent. The Amendment was filed with the State of Nevada on
May 7, 2010, with the actions to take effect on June 30, 2010.
18
We have had limited operations to date. Our business office is located at
1205 Hillsboro Mile, Suite 203, Hillsboro Beach, FL 33062 in premises provided
to us on a month-to-month basis by the Company's President, Vincent Beatty, with
an immaterial value. We are not obligated to pay rent, nor do we pay rent, for
the use of our business office. Our email address is www.datamillmedia.com.
On January 5, 2011, an individual loaned the Company $25,000 in exchange
for a Promissory Note bearing interest at 5%. The note is due on July 4, 2011
and in lieu of the cash interest payment, restricted shares of the Company's
common stock will be issued to the note holder. Upon maturity, the principal
amount loaned of $25,000 is due to the note holder and 75,000 shares of
restricted common stock will be issued to the note holder. In addition, Vincent
Beatty, the CEO of the Company, has personally guaranteed the obligations and
payment of the note and pledged 201,000 shares of Datamill restricted common
stock owned by Mr. Beatty as collateral to secure this $25,000 loan and to
secure his guaranty of the loan.
We are a management consulting firm that plans to educate and assist small
businesses to improve their management, corporate governance, regulatory
compliance and other business processes, with a focus on capital market
participation. We intend to generate revenues, with our two or possibly three
employees, by providing consulting and educational services to primarily private
companies seeking to become publicly traded companies. We have not yet begun
operations and will not begin operations until we have completed this offering.
Our plan of operation is forward looking and there is no assurance that we will
ever begin operations.
We have not conducted any market research into the likelihood of success of
our operations or the acceptance of our products or advisory services by the
public. However, we have had discussions with five potential clients, but we
have advised these potential clients that we cannot help them until we raise the
maximum of $100,000 in offering proceeds in this offering.
BUSINESS OVERVIEW
We cannot assure you that we will be able to raise the maximum $100,000 in
offering proceeds in this offering. If we do not raise the maximum $100,000 in
this offering, then we will not be able to provide our consulting services.
Assuming we have raised the maximum $100,000 in offering proceeds in this
offering, we plan to provide a broad range of value-added management consulting
services designed to improve corporate structures, business practices and
procedures, record keeping, accounting and corporate governance in order for
small private companies to advance and sustain themselves in the public capital
marketplace. We believe that we can begin offering these services within 30 days
of our receipt of the minimum proceeds in this offering; however, we will be
limited personnel-wise and time wise to providing these services to only a few
clients. In the event that we raise the maximum offering proceeds, then we will
have a larger staff and the money to aggressively market our company in an
effort to generate revenues. Initially, and until we have sufficient business
and revenues, we will contract with legal, accounting, marketing and other
professionals on a flat fee or hourly fee basis to assist us in providing our
planned consulting services and will not employ such professionals. We have
never engaged in the type of consulting services we will be offering and cannot
assure you that we will ever achieve profitability.
Although we have not decided on the subject matter or extent of the
materials, we also plan to prepare and publish educational white papers to help
businesspeople make decisions for their companies when accessing the capital
markets. We are currently working on a list of topics for our educational white
papers and intend to have at least two white papers ready for publication by
June 1, 2011. We will be able to finish these two white papers regardless of
whether we raise any money in this offering. Conducting a securities offering or
being a publicly traded company involves a complex myriad of federal and state
laws, rules and regulations, as well as customary best practices and procedures,
any of which easily can be misunderstood, misinterpreted or misapplied. We
believe that the more management teams know and understand about these endeavors
and the issues that they will face, the better able they are to make informed
decisions.
We are a management consulting firm that plans to educate and assist small
businesses to improve their management, corporate governance, regulatory
compliance and other business processes, with a focus on capital market
participation. We will provide solutions to clients at various stages of the
business lifecycle:
* Educational products to improve business processes or explore entering
the capital markets;
* Startup consulting to early-stage companies planning for growth;
* Management consulting to companies seeking to enter the capital
markets via self-underwriting or direct public offering or to move
from one capital market to another; and
* Compliance services to fully reporting, publicly traded companies.
19
We plan to help companies to understand and prepare to meet the obligations
incumbent upon public reporting companies, to access the public capital markets
primarily through the companies' self underwriting or direct public offerings of
their securities. We also plan to guide and assist them in maintaining their
periodic reporting compliance process. We plan to focus on the small business
market, which we believe is underserved by larger management consulting services
firms. We are a fully reporting, small business issuer.
We are initially targeting clients throughout the United States. Once our
website is fully developed (which we anticipate being done by July 1, 2011), we
will begin marketing our services via emails, direct mailing and telephone
calls. We have identified five companies and are talking with others regarding
our proposed consulting services. We have advised these five companies that we
will not be able to provide our consulting services unless we raise the maximum
$100,000 in offering proceeds in this offering. We are hopeful that we can raise
the maximum $100,000 in offering proceeds in this offering and enter into
consulting services agreements with some of these companies in order to generate
revenues beginning June 15, 2011; however, we can not assure you that any of
these potential clients will enter into consulting services agreements with us.
We are also prospecting for other potential clients.
We plan to generate revenue primarily from consulting services that we
provide to private company clients seeking to become fully reporting, publicly
traded companies. We also plan to generate revenue from regulatory compliance
services that we plan to provide to public company clients that are required to
file periodic and other reports with the United States Securities and Exchange
Commission ("SEC"). The regulatory compliance services consist of assistance
with the preparation of financial statements, work papers, schedules and SEC
filings for review by a client's audit firm and securities attorney, assistance
with the EDGARization of SEC filings referring clients to auditors, attorneys
and transfer agents that have a proven track record with their clients. We plan
to offer these services for a flat-fee consisting of cash and restricted shares
of our clients' common stock. We also plan to generate revenue from sales of our
database of educational white papers, instruction manuals, instruction booklets
and example templates to the public and open line consultations with potential
clients regarding their prospects of becoming public companies. As of the date
of this prospectus, we have not determined the amount of fees that we will
charge for our services.
Our monthly "burn rate," the amount of expenses we expect to incur on a
monthly basis, is approximately $2,000 for a total of $18,000 for the maximum of
270 days during which this offering will be made. We have relied, and will
continue to rely, on loans from our officers and directors to fund operations.
However, we do not have any written agreements with our officers and directors
to fund our operating expenses during the 270 days during which this offering
will be made.
In order to complete our plan of operation, we estimate that $90,000 in
funds will be required. The source of such funds is anticipated to be the net
proceeds from this offering. If we fail to generate $90,000 from this offering,
we may not be able to fully carry out our plan of operations.
Assuming we raise the minimum amount of $20,000 in this offering, we
believe we can satisfy our cash requirements during the next 12 months and begin
to implement our business plan at a slower pace than if we raise the maximum
amount in this offering. The minimum amount raised will allow us to develop our
website to an operational extent within 30 days of receipt of the minimum
amount, conduct sufficient marketing within 30 of receipt of the minimum amount,
purchase a minimal amount of inventory (electronic and hard copies of
instruction manuals, instruction booklets and example templates relating to the
consulting and educational services we intend to provide) within 30 days of
receipt of the minimum amount and purchase one computer within three days of
receipt of the minimum amount. Once we receive the $20,000 minimum proceeds, we
will be in a better position to implement our business plan and begin offering
and selling our products on a smaller scale than if we raise the maximum amount
in this offering. In addition, if we only raise the minimum amount in this
offering, we will not be able to offer any consulting services and we will not
have the additional employee required to implement our business plan as quickly
as possible.
20
We cannot assure you that we will be able to raise the maximum $100,000 in
offering proceeds in this offering. If we do not raise the maximum $100,000 in
this offering, we will not be able to provide our consulting services. Assuming
we raise the maximum amount of $100,000 in this offering, we believe we can
fully implement our business plan within 60 days of receipt of the maximum
proceeds, finalize our product research and development within 30 days of
receipt of the maximum proceeds, purchase the required computer equipment within
three days of receipt of the maximum proceeds, and stock our inventory with the
electronic and hard copies of the instruction manuals, instruction booklets and
example templates relating to the consulting and educational services we intend
to provide within 30 days of receipt of the maximum proceeds, including, but not
limited to corporate management, corporate governance, regulatory compliance and
various business processes. Further, we do not expect significant changes in the
number of employees. If we cannot generate sufficient revenues to continue
operations, we will suspend or cease operations. Upon completion of our public
offering, our goal is to expand and market our operations.
We believe that the following steps can be accomplished if we only raise
the minimum of $20,000 in this offering:
Website Development $ 3,000
Computer Purchase $ 1,000
Inventory Purchase $ 2,000
Marketing and Advertising $ 1,000
We believe the above steps will be accomplished within 30 days of our
receipt of proceeds equal to the minimum of $20,000 from this offering.
We believe that the following additional steps can only be accomplished
within 30 days of receipt of proceeds equal to the maximum of $100,000 in this
offering:
Enhancement of our Website $ 2,500
Additional Computer Purchases $ 8,000
Additional Inventory Purchases $40,000
Hire one additional employee $10,000
Hire second additional employee $10,000
We believe the proceeds from the offering will allow us to operate for
twelve months, whether the minimum or maximum is raised. However, the extent of
our operations will be less if we only raise the minimum.
REGULATORY REQUIREMENTS
We are not required to obtain any special licenses, nor meet any special
regulatory requirements before establishing our business, other than a simple
business license. If new government regulations, laws, or licensing requirements
are passed that would restrict or eliminate delivery of any of our intended
products, then our business may suffer. Presently, to the best of our knowledge,
no such regulations, laws, or licensing requirements exist or are likely to be
implemented in the near future that would reasonably be expected to have a
material impact on or sales, revenues, or income from our business operations.
We are not a broker-dealer or Investment Advisor.
MARKETING AND REVENUES
Initially, our business will be promoted by our two officers and directors.
We also anticipate utilizing other marketing avenues in the future in our
attempt to make our products known to the general public and attract potential
customers. These marketing activities will be designed to inform potential
customers about the benefits of using our services and may include the
following: development and distribution of marketing literature; direct mail and
email advertising; television infomercials; and promotion of our web site.
EMPLOYEES; IDENTIFICATION OF CERTAIN SIGNIFICANT EMPLOYEES
We are a development stage company and currently have no employees, other
than our two officers and directors, who will not receive any compensation until
we commence business operations. There are no employment agreements or other
compensation agreements in effect nor are any such agreements anticipated in the
near future. We intend to hire additional employees when they are needed.
21
COMPETITION
We face intense competition in every aspect of our business, and
particularly from other firms which offer management, compliance and other
consulting services to private and public companies. We would prefer to accept a
relatively low cash component as our fee for management consulting and
regulatory compliance services and take a greater portion of our fee in the form
of restricted shares of our private clients' common stock. We also face
competition from a large number of consulting firms, investment banks, venture
capitalists, merchant banks, financial advisors and other management consulting
and regulatory compliance services firms similar to ours. Many of our
competitors have greater financial and management resources and some have
greater market recognition than we do.
MANAGEMENT
OFFICERS AND DIRECTORS
Our two directors will serve until her successor is elected and qualified.
Our officers are elected by the board of directors to a term of one year and
serve until their successor is duly elected and qualified, or until they are
removed from office. Our board of directors has no nominating, auditing or
compensation committees.
The name, address, age and position of our officers and directors are forth
below:
Name and Address Age Positions
---------------- --- ---------
Vincent Beatty 48 Chief Executive Officer, President, Chief Financial
Officer and Director
Thomas Hagan 68 Secretary and Director
The persons named above are expected to hold their offices/positions until
the next annual meeting of our stockholders.
VINCENT BEATTY
Mr. Beatty has been the President/CEO and Chairman of the Board of
Directors of the Company since January, 2010. In 1986, Mr. Beatty became a
retail stockbroker where he worked for First New England Securities and Greenway
Capital Corp. During his tenure with these firms Mr. Beatty helped to syndicate
new public offerings and raised capital for these new issuers. In 1995, Mr.
Beatty opened his own consulting firm, Devken Inc., and has owned and operated
it to the present day. At Devken, Mr. Beatty has transacted several reverse
mergers as well as guided several start-ups in completing their own Direct
Public Offerings. Devken does not offer services similar or competitive to ours.
From 1980-1983 Mr. Beatty attended Western Illinois University where he
studied Business and Finance.
THOMAS J. HAGAN
Mr. Hagan has been appointed as Secretary and a Director of the Company
effective January 15, 2011, and brings to the Company a strong background in
marketing and general management. He will be responsible for working with
management to develop a comprehensive plan for the Company's business
operations.
22
Mr. Hagan served as President of The Dorette Company, a manufacturer of
point of purchase advertising products, from January 1987 until October 2002,
and was responsible for a ten-fold increase in sales at that company during his
tenure. From October 2002 to the present time Mr. Hagan has been an independent
management consultant. His prior business experience includes management
positions at General Electric Company in Cleveland, Philadelphia and Schenectady
from 1960 to 1970. As a management consultant at McKinsey & Company from 1970 to
1973, he developed and managed marketing programs for numerous sales
representative organizations, trade shows, key accounts and national accounts.
Mr. Hagan is a graduate of Boston College School of Management, and
received his Masters in Business Administration Degree from Case Western
University. He has also served as a Captain in the U.S. Army Corps of Engineers.
DIRECTOR QUALIFICATIONS
We do not have a formal policy regarding director qualifications. In the
opinion of Vincent Beatty, our President and majority shareholder, both Mr.
Hagan and himself have sufficient business experience and integrity to carry out
the Company's plan of operations.
ABSENCE OF INDEPENDENT DIRECTORS
We do not have any independent directors and are unlikely to be able to
recruit and retain any independent directors due to our small size and limited
financial resources.
AUDIT COMMITTEE FINANCIAL EXPERT
Although we have not established an Audit Committee. The functions of the
Audit Committee are currently carried out by our Board of Directors.
CONFLICTS OF INTEREST
Both of our officers and directors devote approximately 20 hours per week
to our Company. The only conflict that exists is that our officers and directors
devote time to other projects or business interests, none of which conflict with
our business activities.
Our President, Vincent Beatty, owns Devken Inc., a company that
historically was in a business similar the ours. However, Devken Inc. has
conducted no business during the past two years. Mr. Beatty has committed to the
Company that he will not conduct any business through Devken Inc, or allow
Devken Inc. to conduct any business that is similar to or competitive with the
Company so long as Mr. Beatty is an officer or director of the Company.
Thomas Hagan, our Secretary and Director, has been a management consultant
for several years. Mr. Hagan has committed to the Company that he is not
currently active in any management consulting roles other than his work for the
Company and that he will not engage in any other management consulting roles
while he is working for the Company.
23
EXECUTIVE COMPENSATION
The following table sets forth the aggregate compensation paid by the Company to
our executive officers and directors of the Company for services rendered during
the periods indicated. The Company did not compensate any of its officers or
directors during the fiscal year ended December 31, 2009.
SUMMARY COMPENSATION TABLE
Name and Stock All Other
Principal Position Year(1) Salary($) Bonus($) Awards($) Compensation($) Total($)
------------------ ------- --------- -------- --------- --------------- --------
Vincent Beatty: 2010 $ 0 $ 0 $10,000(1) $ 0 $10,000
Chief Executive Officer, 2009 $ 0 $ 0 $ 0 $ 0 $ 0
President, Chief Financial
Officer and Director
----------
(1) The Company issued 10,000,000 restricted shares of its common stock for
services rendered. The shares were valued at $0.001 per share or $10,000.
We do not have any employment agreements with any of our officers. We do
not contemplate entering into any employment agreements until such time as we
begin to attain profitable operations.
The compensation discussed herein addresses all compensation awarded to,
earned by, or paid to our named executive officer.
STOCK OPTION AND OTHER COMPENSATION PLANS
The Company currently does not have a stock option or any other
compensation plan and we do not have any plans to adopt one in the near future.
COMPENSATION OF DIRECTORS
Our two directors do not receive any compensation for serving as a member
of our board of directors.
INDEMNIFICATION
Under our Articles of Incorporation and Bylaws, we may indemnify an officer
or director who is made a party to any proceeding, including a lawsuit, because
of her position, if she acted in good faith and in a manner she reasonably
believed to be in our best interest. We may advance expenses incurred in
defending a proceeding. To the extent that the officer or director is successful
on the merits in a proceeding as to which she is to be indemnified, we must
indemnify her against all expenses incurred, including attorney's fees. With
respect to a derivative action, indemnity may be made only for expenses actually
and reasonably incurred in defending the proceeding, and if the officer or
director is judged liable, only by a court order. The indemnification is
intended to be to the fullest extent permitted by the laws of the State of
Nevada.
In so far as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to our directors, officers and controlling persons
pursuant to Nevada law or otherwise, we have been advised that, in the opinion
of the Securities and Exchange Commission, such indemnification is against
public policy, as expressed in the Act and is, therefore, unenforceable.
PRINCIPAL STOCKHOLDERS
The following table sets forth, as of the date of this prospectus, the
total number of shares owned beneficially by our directors, officers and key
employees, individually and as a group, and the present owners of 5% or more of
our total outstanding shares. The table also reflects their ownership assuming
24
the sale of all of the shares in this offering. The stockholders listed below
have direct ownership of their shares and possesses sole voting and dispositive
power with respect to the shares.
Number of Percentage of
Shares Ownership
Name and Address Before the Before the
Beneficial Owner Offering Offering
---------------- -------- --------
Vincent Beatty (1) 10,201,350 98.8%
----------
[1] The person named above may be deemed to be a "parent" and "promoter" of our
company, within the meaning of such terms under the Securities Act of 1933,
as amended, by virtue of their direct stock holdings. His business address
is 1205 Hillsboro Mile, Suite 203, Hillsboro Beach, FL 33062.
FUTURE SALES BY EXISTING STOCKHOLDERS
A total of 10,325,000 shares of common stock are held by our present
shareholders. Of this, a total of 10,201,350 shares are beneficially owned by
our President and Chairman, all of which are restricted securities, as defined
in Rule 144 promulgated under the Securities Act of 1933.
Since we are a shell company, Rule 144 is not currently available for the
resale of our restricted securities and will not be available for the resale of
our restricted securities until such time as (i) we cease being a "shell
company" as defined in Rule 405 of the Securities Act of 1933, as amended; (ii)
we file current "Form 10" information with the Securities and Exchange
Commission; (iii) we are subject to the reporting requirements of Section 13 or
15(d) of the Securities Exchange Act of 1934, as amended ("Exchange Act"); (iv)
we have filed all reports and other materials required to be filed by Section 13
or 15(d) of the Exchange Act , other than Form 8-K reports for the preceding 12
months; and (v) one year has elapsed from the date that we filed "Form 10
information" with the Securities and Exchange Commission.
Shares purchased in this offering, which will be immediately resalable, and
sales of all of our other shares if and when applicable restrictions against
resale expire, could have a depressive effect on the market price, if any, of
our common stock and the shares we are offering.
DESCRIPTION OF SECURITIES
COMMON STOCK
Our authorized capital stock consists of 150,000,000 shares of common
stock, par value $0.001 per share. The holders of our common stock:
* have equal ratable rights to dividends from funds legally available if
and when declared by our board of directors;
* are entitled to share ratably in all of our assets available for
distribution to holders of common stock upon liquidation, dissolution
or winding up of our affairs;
* do not have preemptive, subscription or conversion rights and there
are no redemption or sinking fund provisions or rights; and
* are entitled to one non-cumulative vote per share on all matters on
which stockholders may vote.
NON-CUMULATIVE VOTING
Holders of shares of our common stock do not have cumulative voting rights,
which means that the holders of more than 50% of the outstanding shares, voting
for the election of directors, can elect all of the directors to be elected, if
they so choose, and, in that event, the holders of the remaining shares will not
be able to elect any of our directors. After this offering is completed,
assuming the sale of all of our shares of common stock, present stockholders
will own approximately 50% of our outstanding shares.
25
PROMISSORY NOTES AND LOANS
On January 5, 2011, an unaffiliated entity loaned us $25,000 in exchange
for a promissory note for such sum. The promissory note bears interest at the
rate of 5% per year and will be due and payable on July 5, 2011. The promissory
note requires the Company to issue 75,000 shares of restricted common stock to
the lender in lieu of accrued interest on the note when the note is paid. In
addition, Vincent Beatty, our President, personally guaranteed payment and
performance of the note.
During March 2011, Vincent Beatty, our CEO, loaned $40,000 to the Company
for operating funds to pay on-going expenses, including the re-payment of
certain notes payable and advances. The Company did not issue a promissory note
on this transaction and the Company and Mr. Beatty have not determined the
interest rate or maturity date for paying back the loan.
As of December 31, 2010, the Company had two Notes Payable with unrelated
parties. On October 20, 2010, two individuals each loaned the Company $5,000 in
exchange for Promissory Notes for the amounts loaned. The notes, with a term of
one year, are due on October 19, 2011, and in lieu of interest, restricted
shares of the Company's common stock will be issued to the note holders. Upon
maturity, the principal amount loaned of $5,000 is due to each note holder and
an aggregate amount of 30,000 restricted common stock shares will be issued to
the note holders, pursuant to the terms of the notes. The terms of first note
state that 10,000 shares of restricted common stock will be issued to the first
note holder and the terms of the second note state that 20,000 shares of
restricted common stock will be issued to the second note holder.
CASH DIVIDENDS
As of the date of this prospectus, we have not paid any cash dividends to
stockholders. The declaration of any future cash dividend will be at the
discretion of our board of directors and will depend upon our earnings, if any,
our capital requirements and financial position and our general economic
condition. It is our intention not to pay any cash dividends in the foreseeable
future, but rather to reinvest earnings, if any, in our business operations.
ANTI-TAKEOVER PROVISIONS
There are no Nevada anti-takeover provisions that our Board of Directors
has adopted which may have the affect of delaying or preventing a change in
control.
REPORTS
After we complete this offering, we will not be required to furnish you
with an annual report. Further, we will not voluntarily send you an annual
report. We will be required to file reports with the SEC under section 15(d) of
the Securities Act and the reports will be filed electronically. The reports we
will be required to file are Forms 10-K, 10-Q, and 8-K. You may read copies of
any materials we file with the SEC at the SEC's Public Reference Room at 100 F
Street, N.E., Room 1580, Washington D.C. 20549. You may obtain information on
the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.
The SEC also maintains an Internet site that will contain copies of the reports
we file electronically. The address for the Internet site is www.sec.gov.
STOCK TRANSFER AGENT
Our stock transfer agent is Interwest Stock Transfer Co., Salt Lake City,
UT.
CERTAIN TRANSACTIONS
In August, 2010, we issued a total of 10,000,000 shares of restricted
common stock to Vincent Beatty, our President and Chairman, in lieu of cash
compensation for services rendered valued at $10,000. We utilize office space in
Mr. Beatty's home for which we pay no rent.
26
On January 5, 2011, an unaffiliated entity loaned us $25,000 in exchange
for a promissory note for such sum. The promissory note bears interest at the
rate of 5% per year and will be due and payable on July 5, 2011. The promissory
note requires the Company to issue 75,000 shares of restricted common stock to
the lender in lieu of accrued interest on the note when the note is paid. In
addition, Vincent Beatty, our President, personally guaranteed payment and
performance of the note and pledged 201,000 shares of Datamill restricted common
stock owned by Mr. Beatty as collateral to secure this $25,000 loan and to
secure his guaranty of the loan.
During the year ended December 31, 2010, Vincent Beatty, our Chief
Executive Officer, loaned $36,686 to the Company for general and administrative
purposes. The Company repaid $5,000 of the loan during 2010. The net loan of
$31,686 is reflected "as due to related party-officer in our balance sheet as at
December 31, 2010. The Company did not issue a promissory note for these
advances and the Company and Mr. Beatty have not determined the interest rate or
maturity date for paying the loan back.
During March 2011, Vincent Beatty, our CEO, loaned $40,000 to the Company
for operating funds to pay on-going expenses, including the re-payment of
certain notes payable and advances. The Company did not issue a promissory note
on this transaction and the Company and Mr. Beatty have not determined the
interest rate or maturity date for paying the loan back.
LEGAL PROCEEDINGS
On December 22, 2010, the Company received a Demand Letter from Cort
Poyner, an individual, for payment in the amount of $78,676 which is a liability
disclosed in the financial statements, but payable to Simply Fit Holdings Group,
Inc., a defunct company. The Company believes the claim by Mr. Poyner is without
merit. The Company has been informed by counsel for Mr. Poyner that he intends
to commence litigation against the Company with respect to his claim.
During February 2011, both the Company and Mr. Poyner decided not to
litigate the claim, but to agree on terms to satisfy the claim within the next
six months.
EXPERTS
Our financial statements for the years ended December 31, 2010 and 2009 and
for the period from June 1, 2003 (inception) to December 31, 2010, included in
this prospectus have been audited by Salberg & Company, P.A., an independent
registered public accounting firm as set forth in their report included in this
prospectus. Their report is given upon their authority as experts in accounting
and auditing.
LEGAL MATTERS
The validity of the securities offered hereby have been passed upon for us
by of the Law Offices of David E. Wise, Attorney At Law, San Antonio, Texas
78230.
FINANCIAL STATEMENTS
Our fiscal year end is December 31. We will provide audited financial
statements to our stockholders on an annual basis; the statements will be
prepared by management and audited by our independent registered public
accounting firm.
27
INDEX TO FINANCIAL STATEMENTS
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
CONTENTS
Page
----
Report of Independent Registered Public Accounting Firm F-2
Balance Sheets at December 31, 2010 and 2009 F-3
Statements of Operations for the Years Ended December 31, 2010 and 2009,
and for the Period from June 1, 2003 (Inception) to December 31, 2010 F-4
Statement of Changes in Stockholders' Deficit for the Years ended
December 31, 2010 and 2009 and for the Period from June 1, 2003
(Inception) to December 31, 2010 F-5
Statements of Cash Flows for the Years Ended December 31, 2010 and 2009,
and for the Period from June 1, 2003 (Inception) to December 31, 2010 F-6
Notes to Financial Statements F-7
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors of:
DataMill Media Corp. (f/k/a Smitten Press: Local Lore and Legends, Inc.)
We have audited the accompanying balance sheets of DataMill Media Corp.
(f/k/a Smitten Press: Local Lore and Legends, Inc.) (a development stage
company) as of December 31, 2010 and 2009 and the related statements of
operations, changes in stockholders' deficit and cash flows for each of the two
years in the period ended December 31, 2010 and for the period from June 1, 2003
(Inception) to December 31, 2010. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audits 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. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of DataMill Media Corp. (f/k/a
Smitten Press: Local Lore and Legends, Inc.) (a development stage company) as of
December 31, 2010 and 2009, and the results of its operations, and its cash
flows for each of the two years in the period ended December 31, 2010 and for
the period from June 1, 2003 (Inception) to December 31, 2010, in conformity
with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 6 in the
accompanying financial statements, the Company had a net loss and net cash used
in operating activities of $67,747 and $51,316, respectively and had minimal
activity or operations in 2010 and had a deficit accumulated during development
stage of $1,137,293, a working capital deficit of $151,147 and stockholders'
deficit of $151,147 at December 31, 2010 and is a development stage company with
no revenues. These matters raise substantial doubt about the Company's ability
to continue as a going concern. Management's plan in regards to these matters is
also described in Note 6. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
/s/ Salberg & Company, P.A.
------------------------------------
SALBERG & COMPANY, P.A.
Boca Raton, Florida
March 15, 2011
F-2
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
December 31,
-----------------------------------
2010 2009
------------ ------------
ASSETS
CURRENT ASSETS
Cash $ 370 $ --
------------ ------------
TOTAL CURRENT ASSETS 370 --
------------ ------------
TOTAL ASSETS $ 370 $ --
============ ============
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 21,155 $ 14,724
Due to related party-officer 31,686 --
Due to related party -- 78,676
Due to former related party 78,676 --
Advances payable 10,000 --
Notes payable 10,000 --
------------ ------------
TOTAL CURRENT LIABILITIES 151,517 93,400
------------ ------------
TOTAL LIABILITIES 151,517 93,400
------------ ------------
STOCKHOLDERS' DEFICIT
Common stock, $0.001 par value, 150,000,000 shares authorized,
10,325,000 and 325,000 issued and outstanding at December 31,
2010 and 2009, respectively 10,325 325
Additional paid-in capital 1,078,341 1,078,341
Accumulated deficit (102,520) (102,520)
Deficit accumulated during development stage (1,137,293) (1,069,546)
------------ ------------
TOTAL STOCKHOLDERS' DEFICIT (151,147) (93,400)
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 370 $ --
============ ============
See notes to financial statements
F-3
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
For the Period
from June 1, 2003
For the Years Ended December 31, (Inception) to
----------------------------------- December 31,
2010 2009 2010
------------ ------------ ------------
Revenues $ -- $ -- $ --
------------ ------------ ------------
OPERATING EXPENSES
Professional fees 41,372 -- 200,609
General and administrative 16,375 538 92,510
Compensation - officer 10,000 -- 840,427
------------ ------------ ------------
Total Operating Expenses 67,747 538 1,133,616
------------ ------------ ------------
Loss from Operations (67,747) (538) (1,133,616)
OTHER EXPENSE
Loss on foreign currency exchange -- -- (3,677)
------------ ------------ ------------
Net Loss $ (67,747) $ (538) $ (1,137,293)
============ ============ ============
Net Loss per share - Basic and diluted $ (0.02) $ (0.00) $ (1.54)
============ ============ ============
Weighted Average Shares Outstanding -
Basic and diluted 3,914,041 325,000 738,564
============ ============ ============
See notes to financial statements
F-4
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT
For the years ended December 31, 2010 and 2009
and for the period from June 1, 2003 (Inception) to December 31, 2010
Deficit
Accumulated
Common Stock Additional During Total
-------------------- Paid-in Accumulated Development Stockholders'
Shares Par Value Capital Deficit Stage Deficit
------ --------- ------- ------- ----- -------
Balance, June 1, 2003 (Inception) 120,000 $ 120 $ 120,400 $(102,520) $ -- $ --
Common stock issued for book rights 102,500 103 (103) -- -- --
---------- ------- ---------- --------- ----------- ---------
Balance, December 31, 2003 222,500 223 102,297 (102,520) -- --
Contributed officer services -- -- 100,000 -- -- 100,000
Contributed legal services -- -- 2,500 -- -- 2,500
Net loss for the year -- -- -- -- (106,211) (106,211)
---------- ------- ---------- --------- ----------- ---------
Balance, December 31, 2004 222,500 223 204,797 (102,520) (106,211) (3,711)
Contributed legal services -- -- 7,500 -- -- 7,500
Net loss for the year -- -- -- -- (245,365) (245,365)
---------- ------- ---------- --------- ----------- ---------
Balance, December 31, 2005 222,500 223 212,297 (102,520) (351,576) (241,576)
Contributed legal services -- -- 7,500 -- -- 7,500
Net loss for the year -- -- -- -- (162,106) (162,106)
---------- ------- ---------- --------- ----------- ---------
Balance, December 31, 2006 222,500 223 219,797 (102,520) (513,682) (396,182)
Common stock issued for services 100,000 100 392,827 -- -- 392,927
Contributed legal services -- -- 5,000 -- -- 5,000
Contributed capital -- -- 445,719 -- -- 445,719
Net loss for the year -- -- -- -- (470,860) (470,860)
---------- ------- ---------- --------- ----------- ---------
Balance, December 31, 2007 322,500 323 1,063,343 (102,520) (984,542) (23,396)
Contributed officer services -- -- 15,000 -- -- 15,000
Common stock issued for services 2,500 2 (2) -- -- --
Net loss for the year -- -- -- -- (84,466) (84,466)
---------- ------- ---------- --------- ----------- ---------
Balance, December 31, 2008 325,000 325 1,078,341 (102,520) (1,069,008) (92,862)
Net loss for the year -- -- -- -- (538) (538)
---------- ------- ---------- --------- ----------- ---------
Balance, December 31, 2009 325,000 325 1,078,341 (102,520) (1,069,546) (93,400)
Common stock issued for
officer compensation 10,000,000 10,000 -- -- -- 10,000
Net loss for the year -- -- -- -- (67,747) (67,747)
---------- ------- ---------- --------- ----------- ---------
Balance, December 31, 2010 10,325,000 $10,325 $1,078,341 $(102,520) $(1,137,293) $(151,147)
========== ======= ========== ========= =========== =========
See notes to financial statements
F-5
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
For the Period
from June 1, 2003
For the Years Ended December 31, (Inception) to
-------------------------------- December 31,
2010 2009 2010
----------- ---------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (67,747) $ (538) $(1,137,293)
Adjustments to reconcile net loss from operations to
net cash used in operating activities:
Contributed services -- -- 115,000
Contributed legal services -- -- 22,500
Stock-based compensation 10,000 -- 402,927
Changes in assets and liabilities:
Accounts payable and accrued expenses 6,431 538 94,536
Accrued compensation - officer -- -- 322,500
----------- ---------- -----------
NET CASH USED IN OPERATING ACTIVITIES (51,316) -- (179,830)
----------- ---------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from related party - officer 36,686 -- 165,200
Repayment to related party - officer (5,000) -- (5,000)
Proceeds from notes payable 10,000 -- 10,000
Proceeds from advances payable 10,000 -- 10,000
----------- ---------- -----------
NET CASH PROVIDED BY FINANCING ACTIVITIES 51,686 -- 180,200
----------- ---------- -----------
NET CHANGE IN CASH 370 -- 370
CASH - beginning of period -- -- --
----------- ---------- -----------
CASH - end of period $ 370 $ -- $ 370
=========== ========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for:
Interest $ -- $ -- $ --
=========== ========== ===========
Income taxes $ -- $ -- $ --
=========== ========== ===========
NON-CASH INVESTING AND FINANCING ACTIVITIES
Reduction of liabilities reflected as
contributed capital $ -- $ -- $ 445,719
=========== ========== ===========
See notes to financial statements
F-6
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010 and 2009
NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(A) DESCRIPTION OF BUSINESS
Smitten Press: Local Lore and Legends, Inc. (the "Company") was
incorporated under the laws of Canada on January 15, 1990 under the name
Creemore Star Printing, Inc. The name was changed to Smitten Press: Local Lore
and Legends, Inc. on July 15, 2003. The Company was inactive until June 1, 2003
when it entered the development stage. The Company had planned to offer
magazines and books for sale. Given the continued delay in recovery in New
Orleans due to Hurricane Katrina and the death of the Company's founder and
president Mr. Richard Smitten in September 2006, the Company had determined that
proceeding with its initial business plan will not be viable. It began seeking
other alternatives to preserve stockholder value, including selling a
controlling interest to a third party who would subsequently merge an operating
business into the company. On August 30, 2007 a change in control occurred (see
below). Activities during the development stage include development of a
business plan, obtaining and developing necessary rights to sell our products,
developing a website, and seeking a merger candidate.
On August 30, 2007, the Company's controlling shareholder, the Estate of
Richard Smitten, through its executor, Kelley Smitten, sold 152,700 restricted
shares of the Company's common stock held by the estate, which represented 68%
of the then outstanding common stock, in a private transaction, to Robert L. Cox
in exchange for cash consideration of $600,000 (the "Transaction"). As a result,
Robert L. Cox became the Company's controlling shareholder and new CEO. Robert
L. Cox did not engage in any loan transactions in connection with the
Transaction, and utilized his personal funds.
On September 14, 2009, the Company's then controlling shareholder, Carl
Feldman (who obtained his controlling interest from Robert Cox in June of 2008
in a private transaction), sold 202,700 restricted shares of the Company's
common stock held in the name of Mr. Feldman, which represented 62% of the then
outstanding common stock, in a private transaction, to Vincent Beatty in
exchange for cash consideration of $10,000 (the "Transaction"). As a result,
Vincent Beatty became the Company's controlling shareholder. Mr. Beatty engaged
in a loan transaction in connection with the above mentioned stock purchase.
On April 30, 2010, the holders of a majority of the shares of Common Stock
of the Registrant acting on written consent elected Vincent Beatty as Director
and President of the Company, and Robert Kwiecinski as Director and Secretary of
the Company, to serve in said positions until the next Meeting of Shareholders.
On April 30, 2010, our Board of Directors approved a change in name of the
Registrant to DataMill Media Corp., a reverse-split of our Common Stock on the
basis of one new share of Common Stock for each one hundred shares of Common
Stock held of record at the close of business on June 30, 2010 and an increase
in the number of authorized common stock from 50,000,000 shares to 150,000,000
shares. These corporate actions were ratified on April 30, 2010 by holders of a
majority of the shares of Common Stock of the Registrant acting on written
consent and the Amendment was filed with the State of Nevada on May 7, 2010. The
Registrant was notified by Financial Industry Regulatory Authority ("FINRA")
that the name and new symbol change of DATAMILL MEDIA CORP. "SPLID" became
effective on August 23, 2010. All share and per share data has been adjusted to
reflect the effect of the reverse-split.
(B) BASIS OF PRESENTATION AND FOREIGN CURRENCY
Gains and losses resulting from foreign currency transactions are
recognized in operations in the accompanying financial statements and footnotes
in the period incurred.
F-7
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010 and 2009
NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
(C) USE OF ESTIMATES
In preparing financial statements, management is required to make estimates
and assumptions that effect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and revenues and expenses during the periods presented. Actual
results may differ from these estimates.
Significant estimates in 2010 and 2009 include an estimate of the deferred
tax asset valuation allowance, valuation of shares issued for services, and
valuation of contributed services.
(D) CASH EQUIVALENTS
For the purpose of the cash flow statement, the Company considers all
highly liquid investments with original maturities of three months or less at
the time of purchase to be cash equivalents.
(E) WEBSITE DEVELOPMENT COSTS
In accordance with ASC 350-50, formerly EITF Issue No. 00-2, the Company
accounts for its website in accordance with ASC 350-40, formerly Statement of
Position No. 98-1 "Accounting for the Costs of Computer Software Developed or
Obtained for Internal Use" "SOP 98-1".
ASC 350-40 requires the expensing of all costs of the preliminary project
stage and the training and application maintenance stage and the capitalization
of all internal or external direct costs incurred during the application
development stage. The Company amortizes the capitalized cost of software
developed or obtained for internal use over an estimated life of three years.
(F) STOCK-BASED COMPENSATION
The Company follows the provisions of ASC 718-20-10 Compensation - Stock
Compensation which establishes standards surrounding the accounting for
transactions in which an entity exchanges its equity instruments for goods or
services. ASC 718-20-10 focuses primarily on accounting for transactions in
which an entity obtains employee services in share-based payment transactions.
ASC 718-20-10 provides for, and the Company has elected to adopt the modified
prospective application under which compensation cost is recognized on or after
the required effective date for the fair value of all future share based award
grants and the portion of outstanding awards at the date of adoption of this
statement for which the requisite service has not been rendered, based on the
grant-date fair value of those awards calculated under ASC 718-20-10 pro forma
disclosures.
(G) PROMOTER CONTRIBUTION AND CONTRIBUTED SERVICES
The Company accounts for assets provided to the Company by promoters in
exchange for capital stock at the promoter's original cost basis. The value of
services provided to the Company by its officer was $115,000 for the period from
June 1, 2003 (Inception)to December 31, 2010 which was recorded as contributed
services.
(H) REVENUE RECOGNITION
The Company intends on recognizing revenues in accordance with ASC 605-10.
Revenue will be recognized when persuasive evidence of an arrangement exists, as
services are provided or when product is delivered, and when collection of the
fixed or determinable selling price is reasonably assured.
F-8
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010 and 2009
NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
(I) INCOME TAXES
The Company accounts for income taxes under ASC 740, formerly Financial
Accounting Standards No. 109 "Accounting for Income Taxes". Under ASC 740,
deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The effect on deferred tax
assets and liabilities of a change in tax rates is recognized in income in the
period, which includes the enactment date.
In June 2006, the Financial Accounting Standards Board issued FASB
Interpretation No. 48 (FIN-48), Accounting for Uncertainty in Income Taxes--An
interpretation of FASB Statement No. 109 and codified into ASC 740. FIN-48
clarifies the accounting for uncertainty in income taxes recognized in an
entity's financial statements in accordance with Statement of Financial
Accounting Standards No.109, Accounting for Income Taxes. This Interpretation
prescribed a recognition threshold and measurement attribute for the financial
statement recognition and measurement of a tax position taken or expected to be
taken in a tax return. In addition, FIN-48 provides guidance on de-recognition,
classification, interest and penalties, accounting in interim periods,
disclosure, and transition. The Company adopted the provisions of FIN-48 and
they had no impact on its financial position, results of operations, and cash
flows.
Based on its evaluation, the Company has concluded that there are no
significant uncertain tax positions requiring recognition in its financial
statements. The Company's evaluation was performed for the tax years ended
December 31, 2004 through December 31, 2010 for U.S. Federal Income Tax, for the
tax years ended December 31, 2004 through December 31, 2010 for the State of
Florida Corporate Income Tax, the years which remain subject to examination by
major tax jurisdictions as of December 31, 2010.
(J) COMPREHENSIVE INCOME (LOSS)
Comprehensive income (loss) includes net loss as currently reported by the
Company adjusted for other comprehensive income, net of comprehensive losses.
Other comprehensive income for the Company consists of unrealized gains and
losses related to the Company's foreign currency cumulative translation
adjustment. The comprehensive loss for the periods presented in the accompanying
financial statements was not material.
F-9
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010 and 2009
NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
(K) FAIR VALUE OF FINANCIAL INSTRUMENTS
ASC 825-10, formerly Statement of Financial Accounting Standards No. 107,
"Disclosures about Fair Value of Financial Instruments," requires disclosures of
information about the fair value of certain financial instruments for which it
is practicable to estimate the value. For purpose of this disclosure, the fair
value of a financial instrument is the amount at which the instrument could be
exchanged in a current transaction between willing parties, other than in a
forced sale or liquidation.
At December 31, 2010 the fair value of current liabilities approximated
book value.
(L) NEW ACCOUNTING PRONOUNCEMENTS
RECENTLY ISSUED ACCOUNTING STANDARDS
In May 2009, the Financial Accounting Standards Board ("FASB") issued an
accounting standard that became part of ASC Topic 855, "Subsequent Events". ASC
Topic 855 establishes general standards of accounting for and disclosure of
events that occur after the balance sheet date but before financial statements
are issued or are available to be issued. ASC Topic 855 sets forth (1) the
period after the balance sheet date during which management of a reporting
entity should evaluate events or transactions that may occur for potential
recognition or disclosure in the financial statements, (2) the circumstances
under which an entity should recognize events or transactions occurring after
the balance sheet date in its financial statements and (3) the disclosures that
an entity should make about events or transactions that occurred after the
balance sheet date. ASC Topic 855 is effective for interim or annual financial
periods ending after June 15, 2009. The adoption of ASC Topic 855 did not have a
material effect on the Company's financial statements.
In June 2009, the FASB issued an accounting standard whereby the FASB
Accounting Standards Codification ("Codification") will be the single source of
authoritative non-governmental United States of America generally accepted
accounting principles ("GAAP"). Rules and interpretive releases of the United
States of America Securities and Exchange Commission ("SEC") under authority of
federal securities laws are also sources of authoritative GAAP for SEC
registrants. ASC Topic 105 is effective for interim and annual periods ending
after September 15, 2009. All existing accounting standards are superseded as
described in ASC Topic 105. All other accounting literature not included in the
Codification is non-authoritative. The Codification has not had a significant
impact on the Company's financial statements.
Other accounting standards that have been issued or proposed by the FASB or
other standards-setting bodies that do not require adoption until a future date
are not expected to have a material impact on the consolidated financial
statements upon adoption.
NOTE 2 - RELATED PARTIES AND ADVANCES PAYABLE
Office space was and is provided on a month-to-month basis by the Company's
CEO for no charge, however, for all periods presented, the value was not
material.
A promoter contributed certain rights and inventory to the Company for
102,500 common shares in 2003. (See Note 4)
F-10
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010 and 2009
NOTE 2 - RELATED PARTIES AND ADVANCES PAYABLE (CONTINUED)
During each of the years ended December 31, 2004, 2005, 2006 and December
31, 2007, the Company received proceeds totaling $67,037 from the Company's
former officers ($100, $630, $20, $22,573, and $23,734 respectively) for general
and administrative expenses. Additionally, during 2007, a former officer
advanced cash to the company of $8,846. On August 30, 2007, in connection with
the sale of the Company's common stock in a private transaction (See Note 1),
this debt was settled. Accordingly, the Company reduced this debt by $52,149 and
reflected contributed capital of $52,149 by increasing paid-in capital on the
accompanying balance sheet.
Prior to August 30, 2007, the Company reflected accrued compensation -
officers of $322,500 due to the Company's former officers of $310,000 and
$12,500, respectively. In August 2007, in connection with the sale of certain
common shares of Company's common stock held by a majority stockholder, in a
private transaction (See Note 1), this accrued compensation was settled.
Accordingly, the Company reduced accrued compensation - officers by $322,500 and
reflected contributed capital of $322,500 by increasing paid-in capital on the
accompanying balance sheet.
During the years ended December 31, 2004 through 2007, in connection with
legal services provided by a former officer of the Company, the Company valued
these services at their fair market value and recorded compensation expense and
contributed capital totaling $22,500 for the period from June 1, 2003
(Inception) to December 31, 2010.
During the years ended December 31, 2007 and 2008, an affiliated company
related to the Company's former chief executive officer through common
ownership, advanced funds of $17,199 and $61,477, respectively, to the Company
for working capital purposes. These advances, totaling $78,676, are reflected as
due to related party on the accompanying December 31, 2010 and 2009 balance
sheets, are non-interest bearing and are payable on demand.
On August 23, 2010, the Company issued 10,000,000 restricted shares of its
common stock to its chief executive officer, Vincent Beatty, for services
rendered. The shares were valued at $0.001 per share, a nominal value as there
was no evidence of fair value, or $10,000 and expensed immediately as
compensation.
During the year ended December 31, 2010, the Company received proceeds
totaling $36,686 from the Company's current chief executive officer for general
and administrative expenses and repaid $5,000 of the amount during the same
period. The net amount of $31,686 is reflected as due to related party-officer
on the accompanying December 31, 2010 balance sheet.
NOTE 3 - NOTES AND ADVANCES PAYABLE
As of December 31, 2010, the Company had two Notes Payable with unrelated
parties. On October 20, 2010, two individuals each loaned the Company $5,000 in
exchange for Promissory Notes for the amounts loaned. The notes, with a term of
one year, are due on October 19, 2011 and in lieu of interest, restricted shares
of the Company's common stock will be issued to the note holders. Upon maturity,
the principal amount loaned of $5,000 is due to each note holder and an
aggregate amount of 30,000 restricted common stock shares will be issued to the
note holders, pursuant to the terms of the notes. The value of the shares to be
issued was not material.
In September 2010, an individual advanced $10,000 to the Company. The
advance is non-interest bearing and due on demand. This amount is reflected as
advances payable on the accompanying December 31, 2010 balance sheet.
F-11
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010 and 2009
NOTE 4 - STOCKHOLDERS' DEFICIT
In June 2003, the Company issued 102,500 shares to R. L. Smitten who was
considered a promoter for perpetual exclusive rights to market local lore and
legend magazines. There was no net accounting effect of this transaction as the
original cost basis to the promoter was zero.
During 2004, compensation in the amount of $100,000 was recorded to
additional paid-in capital for services provided by the officer.
During 2004, legal expenses in the amount of $2,500 were recorded to
additional paid-in capital for legal services provided.
During 2005, legal expenses in the amount of $7,500 were recorded to
additional paid-in capital for legal services provided.
During 2006, legal expenses in the amount of $7,500 were recorded to
additional paid-in capital for legal services provided.
During 2007, legal expenses in the amount of $5,000 were recorded to
additional paid-in capital for legal services provided.
On May 8, 2007, the Company filed Articles of Domestication and Articles of
Incorporation with the State of Nevada. The Company became a Nevada corporation
and had 50,000,000 shares of $0.001 par value common stock authorized prior to
the 2010 increase to 150,000,000 authorized common shares discussed in Note 1(A)
and elimination of the authorized preferred shares. The effect of the
re-domestication was to reclassify $80,270 to additional paid-in capital from
common stock for the change in par value. All share and per share amounts have
been retroactively reflected for the change.
On August 30, 2007, in connection with the sale of the Company's common
stock in a private transaction (See Note 1), accounts payable amounting to
$73,381 was repaid and the former officer's estate retained the remaining cash
balance of $2,311. Accordingly, the Company reduced accounts payable by $73,381
and reduced cash by $2,311 and reflected a contributed capital of $71,070 by
increasing paid-in capital on the accompanying balance sheet.
On August 30, 2007, in connection with the sale of the Company's common
stock in a private transaction (See Note 1), amounts due to former officers of
the company of $52,149 and accrued compensation - officers of $322,500 was
settled. Accordingly, the Company reflected a contributed capital of $374,649 by
increasing paid-in capital on the accompanying balance sheet.
On September 30, 2007, the Company issued 100,000 shares of its common
stock to its chief executive officer for services rendered. The shares were
valued and expensed at $392,927 or $0.039 per share which was a contemporaneous
sale price in a private transaction where a former officer's estate sold a
portion of his common shares of the Company to the new officer (see Note 1).
During 2008, compensation in the amount of $15,000 was recorded as
additional paid-in capital for services provided by an officer of the Company.
In April 2008, the Company issued 2,500 shares of common stock for
services. The value of the shares issued was not material.
On August 23, 2010, the Company issued 10,000,000 restricted shares of its
common stock to its chief executive officer, Vincent Beatty, for services
rendered. The shares were valued at $0.001 per share, a nominal amount since
there was no other evidence of fair value of the shares, or $10,000 and expensed
immediately as compensation.
F-12
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010 and 2009
NOTE 5 - INCOME TAXES
There was no income tax expense for the years ended December 31, 2010 and
2009 due to the Company's net losses. The Company has established a 100%
valuation allowance against any deferred tax assets which primarily relate to
the Company's net operating loss carry-forwards.
The Company's tax expense differs from the "expected" tax expense for
Federal income tax purposes for the years ended December 31, 2010 and 2009,
(computed by applying an estimated Corporate tax rate of 40% to loss before
taxes), as follows:
Years Ended December 31,
--------------------------
2010 2009
-------- --------
Computed "expected" tax benefit $(27,099) $ (215)
Contributed services -- --
Change in deferred tax asset valuation allowance 27,099 215
-------- --------
$ -- $ --
======== ========
The effects of temporary differences that gave rise to significant portions of
deferred tax assets and liabilities at December 31, 2010 and 2009 are as
follows:
Years Ended December 31,
-----------------------------
2010 2009
--------- ---------
Deferred tax assets:
Operating loss carry-forward $ 440,925 $ 413,826
Total gross deferred tax assets 440,925 413,826
Less valuation allowance (440,925) (413,826)
--------- ---------
Net deferred tax assets $ -- $ --
========= =========
The valuation allowance at December 31, 2010 and 2009 was $440,925 and
$413,826, respectively. The valuation allowance increased by $27,099 during the
year ended December 31, 2010. The Company has net operating losses of
approximately $1,240,000 at December 31, 2010 available to offset future net
income through 2030.
The utilization of the net operating loss carry-forwards is dependent upon
the ability of the Company to generate sufficient taxable income during the
carry-forward period. The Company has had a change of ownership and change in
business as defined by the Internal Revenue Code Section 382. As a result, a
substantial annual limitation may be imposed upon the future utilization of its
net operating loss carry-forwards.
Based on its evaluation, as described in Note 1, the Company has concluded
that there are no significant uncertain tax positions requiring recognition in
its financial statements. The Company's evaluation was performed for the tax
years ended December 31, 2004 through December 31, 2010 for both U.S. Federal
Income Tax and for the State of Florida Corporate Income Tax, the years which
remain subject to examination by the respective tax jurisdictions as of December
31, 2010.
F-13
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010 and 2009
NOTE 6 - GOING CONCERN
As reflected in the accompanying financial statements, the Company had a
net loss and net cash used in operations of $67,747 and $51,316, respectively,
for the year ended December 31, 2010 and a deficit accumulated during
development stage of $1,137,293, a working capital deficit of $151,147 and
stockholders' deficit of $151,147 at December 31, 2010 and is a development
stage company with no revenues. The ability of the Company to continue as a
going concern is dependent on the Company's ability to further implement its
business plan, raise capital, and generate revenues. We are a management
consulting firm that plans to educate and assist small businesses to improve
their management, corporate governance, regulatory compliance and other business
processes, with a focus on capital market participation. We intend to generate
revenues, with our two or possibly three employees, by providing consulting and
educational services to primarily private companies seeking to become publicly
traded companies. Management believes that the actions presently being taken
provide the opportunity for the Company to continue as a going concern. The
financial statements do not include any adjustments that might be necessary if
the Company is unable to continue as a going concern.
NOTE 7 - CONCENTRATIONS
As discussed in Note 1, through the change in ownership of the Company,
from August 2007 through 2008, the Company was funded solely by funds totaling
$78,676, advanced through a commonly controlled affiliate, Simply Fit Holdings
Group, Inc. The amount owed as of December 31, 2010 and 2009 was $78,676.
NOTE 8 - COMMITMENTS AND CONTINGENCIES
The Company was named as a defendant with others in a lawsuit filed June
24, 2008 in the Florida Southern District Court, Case No. 0:2008cv60953. The
plaintiff, a New York individual, alleges a RICO count against all of the
defendants. On September 14, 2009 a settlement agreement was reached with the
plaintiff on behalf of the Company where all claims were settled. There was no
accounting effect on the Company as a result of the settlement.
NOTE 9 - LEGAL MATTERS
On December 22, 2010, the Company received a Demand Letter from an
individual for payment in the amount of $78,676, which is a liability disclosed
in the financial statements, but payable to another entity. The Company believed
the claim by the individual was without merit and the Company was informed by
counsel for the individual that he intends to commence litigation against the
Company with respect to his claim.
During February 2011, the Company and the individual have discussed the
claim and the parties have decided not to litigate the claim, but to agree on
terms to satisfy the claim within the next six months.
F-14
DATAMILL MEDIA CORP.
(f/k/a SMITTEN PRESS: LOCAL LORE AND LEGENDS, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010 and 2009
NOTE 10 - SUBSEQUENT EVENTS
The Company has performed an evaluation of subsequent events in accordance
with ASC Topic 855. Other than the events noted below, the Company is not aware
of any subsequent events which would require recognition or disclosure in the
financial statements.
On January 5, 2011, an individual loaned the Company $25,000 in exchange
for a Promissory Note bearing interest at 5%. The note, with a term of six
months, is due on July 4, 2011 and in lieu of the interest payment, restricted
shares of the Company's common stock will be issued to the note holder. Upon
maturity, the principal amount loaned of $25,000 is due to the note holder and
an aggregate amount of 75,000 restricted common stock shares will be issued to
the note holder, pursuant to the terms of the note. In addition, Vincent Beatty,
the CEO of the Company, has personally guaranteed the obligations and payment of
the note.
During February 2011, both the Company and an individual claiming that the
Company owed him $78,676, have decided not to litigate the claim, but to agree
on terms to satisfy the claim within the next six months.
During March 2011, the Company paid in full notes payable to two
individuals totaling $10,000. An aggregate of 30,000 shares of common stock, per
the agreements, will be issued to these individuals on the anniversary date of
these notes, October 2011.
During March 2011, an officer loaned $40,000 to the Company for operating
funds to pay on-going expenses, including the re-payment of certain notes
payable and advances.
F-15
We have not authorized any dealer, salesperson or other person to provide
any information or make any representations about Datamill Media Corp., except
the information or representations contained in this prospectus. You should not
rely on any additional information or representations if made.
This prospectus does not constitute an offer to sell, or a solicitation of
an offer to buy any securities:
* except the common stock covered by this prospectus
* in any jurisdiction in which the distribution, offer or solicitation
is not authorized
* in any jurisdiction where the dealer or other salesperson is not
qualified to make the offer or solicitation;
* to any person who is not a United States resident or who is outside
the jurisdiction of the United States
The delivery of this prospectus or any accompanying sale does not imply
that:
* there have been no changes in the affairs of Datamill Media Corp.
after the date of this prospectus; or
* the information contained in this prospectus is correct after the date
of this prospectus.
During the 150 days following the date of this prospectus, all dealers
effecting transactions in the registered securities, whether or not
participating in this distribution, may be required to deliver a prospectus.
This is in addition to the obligation of dealers to deliver a prospectus when
acting as underwriters.
PROSPECTUS
5,000,000 SHARES OF COMMON STOCK
DATAMILL MEDIA CORP.
MAY 12, 2011