U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q/A
Amendment No. 1
Mark One
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 2010
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ______ to _______
Commission File No. 333-152551
SYNC2 NETWORKS CORP
(Name of small business issuer in its charter)
Nevada 26-1754034
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
5836 South Pecos Road, Suite 112
Las Vegas, NV 89120
(Address of principal executive offices)
1-702-315-0521
(Issuer's telephone number)
Securities registered pursuant to Name of each exchange on which
Section 12(b) of the Act: registered:
------------------------- -----------
None N/A
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $0.001 each par value
(Title of Class)
Indicate by checkmark whether the issuer: (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months
(or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days. Yes [X] No[ ]
Indicate by check mark whether the registrant is a large accelerated filed, an
accelerated filer, a non-accelerated filer, or a smaller reporting company.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by checkmark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [ ] No [X]
Applicable Only to Issuer Involved in Bankruptcy Proceedings During the
Preceding Five Years. N/A
Indicate by checkmark whether the issuer has filed all documents and reports
required to be filed by Section 12, 13 and 15(d) of the Securities Exchange Act
of 1934 after the distribution of securities under a plan confirmed by a court.
Yes [ ] No[ ]
Applicable Only to Corporate Registrants
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the most practicable date:
Class Outstanding as of March 31, 2010
----- --------------------------------
Common Stock, $0.001 85,850,000
PART I - FINANCIAL INFORMATION
The accompanying interim unaudited financial statements of Sync2 Networks Corp.
(a Nevada corporation) for the nine months ended March 31,2010 are condensed
and, therefore, do not include all disclosures normally required by accounting
principles generally accepted in the United States of America. These statements
should be read in conjunction with the Company's most recent annual financial
statements for the year ended June 30, 2009 included in a Form 10-K filed with
the U.S. Securities and Exchange Commission ("SEC") on September 28, 2009. In
the opinion of management, all adjustments necessary for a fair presentation
have been included in the accompanying interim financial statements and consist
of only normal recurring adjustments.The results of operations presented in the
accompanying interim financial statements for the nine months ended March 31,
2010 are not necessarily indicative of the operating results that may be
expected for the full year ending June 30, 2010.
2
Sync2 Networks Corp
(A Development Stage Company)
Balance Sheets
March 31, June 30,
2010 2009
------------ ------------
Unaudited
ASSETS
CURRENT ASSETS
Cash $ 13,334 $ 17,702
Accounts receivable 34,267 51,114
Work in process -- 17,650
------------ ------------
TOTAL CURRENT ASSETS 47,601 86,466
Fixed Assets 122,315 162,492
Goodwill -- 459,706
------------ ------------
TOTAL ASSETS $ 169,916 $ 708,664
============ ============
LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)
CURRENT LIABILITES
Accounts payable $ 566,169 $ 159,628
Deferred revenue -- 7,684
Due to related parties 1,096,862 763,355
------------ ------------
TOTAL CURRENT LIABILITIES 1,663,031 930,667
------------ ------------
TOTAL LIABILITIES 1,663,031 930,667
------------ ------------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock
Authorized: 150,000,000: par value $0.001 per share
Issued: 85,850,000 as of Mar 31, 2010 85,850 85,850
85,850,000 as of June 30,2009
Additional paid-in capital (deficiency) (61,350) (61,350)
Other comprehensive (debits) credits (36,646) --
Deficit accumulated during exploration stage (1,480,969) (246,503)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (1,493,115) (222,003)
------------ ------------
TOTAL LIABILTIES AND STOCKHOLDERS' EQUITY $ 169,916 $ 708,664
============ ============
The accompanying notes are an integral part of these financial statements
3
Sync2 Networks Corp
(A Development Stage Company)
Statements of Operations for the Nine Months Ended March 31,2010 and 2009
and for the period from January 16, 2008 (date of inception) to
March 31, 2010 Cumulative
Results of
Operations From
Three months Three months Nine months Nine months the date of
ended ended ended ended inception to
March 31, March 31, March 31, March 31, March 31,
2010 2009 2010 2009 2010
------------ ------------ ------------ ------------ ------------
REVENUES $ -- $ -- $ 151,608 $ -- $ 354,191
------------ ------------ ------------ ------------ ------------
Salaries and benefits -- -- 353,812 -- 523,494
Rent -- -- 86,081 -- 142,851
Marketing -- -- 17,211 -- 31,831
Foreign exchange -- -- 5,570 -- 11,478
Amortization 39,268 -- 104,886 -- 161,184
Transfer agent fees -- -- 1,808 1,808
Professional fees -- 1,780 37,000 3,480 52,180
Management fees -- -- 77,647 -- 133,822
Administration fees 82,083 -- 182,083 -- 182,083
Financial consulting -- -- 17,694 -- 33,572
Travel/Meals and Lodging -- -- 1,164 -- 5,806
General and Administration -- 2,269 34,798 19,847 86,923
------------ ------------ ------------ ------------ ------------
TOTAL OPERATING COSTS 121,351 4,049 917,946 25,135 1,367,032
------------ ------------ ------------ ------------ ------------
Loss from operations before
taxes and other (121,351) (4,049) (766,338) (25,135) (1,012,841)
OTHER
Write off of goodwill -- -- (468,128) -- (468,128)
------------ ------------ ------------ ------------ ------------
(121,351) (4,049) (1,234,466) (25,135) (1,480,969)
Income tax expense -- -- -- -- --
------------ ------------ ------------ ------------ ------------
NET LOSS FOR THE PERIOD $ (121,351) $ (4,049) $ (1,234,466) (25,135) $ (1,480,969)
------------ ------------ ------------ ------------ ------------
BASIC AND DILUTED EARNINGS
(LOSS) PER SHARE $ (0.00) $ (0.00) $ (0.01) $ (0.00)
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 85,850,000 5,050,000 85,850,000 5,050,000
The accompanying notes are an integral part of these financial statements
4
Sync2 Networks Corp
(A Development Stage Company)
Statements of Cash Flows for the Nine Months Ended March 31, 2010 and 2009
and for the period from January 16, 2008 (date of inception) to March 31, 2010
Cumulative
Results of
Operations From
Nine months Nine months the date of
ended ended inception to
March 31, March 31, March 31,
2010 2009 2010
------------ ------------ ------------
OPERATING ACTIVITIES
Net loss
Adjustments to reconcile net loss to net cash
used in operating activities: $ (1,234,466) $ (21,086) $ (1,480,969)
Non cash expense - Amortization 104,886 -- 161,184
- Foreign exchange 5,570 -- 11,478
- Write off of goodwill 459,706 -- 459,706
Increase (decrease) in deferred revenue (7,684) -- --
(Increase) in accounts receivable (16,847) -- (34,267)
(Increase) decrease in work in process 17,650 -- --
Increase (decrease) in accounts payable 406,541 200 566,169
------------ ------------ ------------
NET CASH USED IN OPERATING ACTIVITIES (230,950) (20,886) (316,699)
------------ ------------ ------------
INVESTING ACTIVITIES
Fixed assets (40,589) -- (219,392)
Goodwill -- -- (501,497)
------------ ------------ ------------
NET CASH USED IN INVESTING ACTIVITIES (40,589) -- (720,889)
------------ ------------ ------------
FINANCING ACTIVITIES
Proceeds from sale of common stock -- -- 24,500
Increase in due to related parties 333,507 -- 1,096,862
------------ ------------ ------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 333,507 -- 1,121,362
------------ ------------ ------------
EFFECT OF FOREIGN EXCHANGE ON CASH (66,336) -- (70,440)
------------ ------------ ------------
NET INCREASE (DECREASE) IN CASH (4,368) (20,886) 13,334
CASH, BEGINNING OF PERIOD 17,702 24,207 --
------------ ------------ ------------
CASH, END OF PERIOD $ 13,334 $ 3,321 $ 13,334
============ ============ ============
SUPPLEMENTAL CASH FLOW INFORMATION AND
NONCASH FINANCING ACTIVITIES:
Interest paid $ -- $ -- $ --
Income taxes paid $ -- $ -- $ --
Common stock issued for services $ -- $ -- $ --
The accompanying notes are an integral part of these financial statements
5
Sync2 Networks Corp
(A Development Stage Company)
Notes to the Financial Statements
March 31, 2010
(Unaudited)
1. BASIS OF PRESENTATION, NATURE OF BUSINESS AND ORGANIZATION
Sync2 Networks Corp (the "Company") was formed on January 16, 2008 in the State
of Nevada under the name Plethora Resources, Inc. as a development stage
company.
On June 25, 2009 the Company purchased the assets and business of Sync2
International Ltd. in exchange for the assumption of all outstanding debts of
Sync2 Agency Ltd. ("Agency"). Agency is a wholly owned subsidiary of Sync2
International Ltd., a web development and web property management company.
Effective May 14, 2009 the Company changed its name to Sync2 Networks Corp.
The Company's business plan is to be an interactive marketing firm that designs,
builds, implements and optimizes strategic interactive web networks and internet
marketing programs that acquire, convert and retain customers for clients.
The Company is considered to be in the development stage as defined in Statement
of Financial Accounting Standards (SFAS) No. 7, "ACCOUNTING AND REPORTING BY
DEVELOPMENT STAGE ENTERPRISES". The Company has devoted substantially all of its
efforts to business planning and development, as well as allocating a
substantial portion of its time and investment in bringing product(s)/services
to the market, and the raising of capital.
For the period from inception, January 16, 2008 through March 31, 2010 the
Company has accumulated losses of $1,480,969.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a)Basis of Presentation
The financial statements of the Company have been prepared in accordance with
accounting principles generally accepted in the United States of America and are
presented in US dollars.
b) Going Concern
The financial statements have been prepared on a going concern basis which
assumes the Company will be able to realize its assets and discharge its
liabilities in the normal course of business for the foreseeable future. The
Company has incurred losses since inception resulting in an accumulated deficit
of $1,480,969 as of March 31,2010 and further losses are anticipated in the
development of its business raising substantial doubt about the Company's
ability to continue as a going concern.
6
Sync2 Networks Corp
(A Development Stage Company)
Notes to the Financial Statements
March 31, 2010
(Unaudited)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The ability to continue as a going concern is dependent upon the Company
generating profitable operations in the future and/or to obtain the necessary
financing to meet its obligations and repay its liabilities arising from normal
business operations when they come due. Management intends to finance operating
costs over the next twelve months with existing cash on hand and loans from
directors and shareholders and or private placement of common stock.
c) Cash and Cash Equivalents
The Company considers all highly liquid instruments with a maturity of three
months or less at the time of issuance to be cash equivalents.
d) Use of Estimates and Assumptions
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ
from those estimates.
e) Foreign Currency Translation
The Company's functional currency is Canadian dollars and its reporting currency
is the United States dollar.
f) Financial Instruments
The carrying value of the Company's financial instruments approximates their
fair value because of the short maturity of these instruments.
g) Stock-based Compensation
Stock-based compensation is accounted for at fair value in accordance with SFAS
No's. 123 and 123(R). To date, the Company has not adopted a stock option plan
and has not granted any stock options.
h) Income Taxes
Income taxes are accounted for under the assets and liability method. Deferred
tax assets and liabilities are recognized for the estimated future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases and operating loss and tax credit carry forwards.
7
Sync2 Networks Corp
(A Development Stage Company)
Notes to the Financial Statements
March 31, 2010
(Unaudited)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Deferred tax assets and liabilities are measured using enacted tax rates in
effect for the year in which those temporary differences are expected to be
recovered or settled.
i) Basic and Diluted Net Loss per Share
The Company computes net loss per share in accordance with SFAS No.
128,"Earnings per Share". SFAS No. 128 requires presentation of both basic and
diluted earnings per share (EPS) on the face of the income statement. Basic EPS
is computed by dividing net loss available to common shareholders (numerator) by
the weighted average number of shares outstanding (denominator) during the
period. Diluted EPS gives effect to all potentially dilutive common shares
outstanding during the period. Diluted EPS excludes all potentially dilutive
shares if their effect is anti-dilutive.
j) Fiscal Periods
The Company's fiscal year end is June 30.
k) Recent Accounting Pronouncements
There are no recent accounting pronouncements known to the Company which, if
applied, would affect the disclosure in these financial statements. Please also
refer to the Company's year end June 30, 2009 notes to financial statements.
3. GOING CONCERN
As shown in the accompanying financial statements, the Company incurred
substantial net losses since incorporation and has insufficient revenue stream
to support itself. This raises doubt about the Company's ability to continue as
a going concern.
The Company's future success is dependent upon its ability to raise additional
capital to fund its business plan and ultimately to attain profitable
operations. There is no guarantee that the Company will be able to raise enough
capital or generate sufficient revenues to sustain its operations. Management
believes they can raise the appropriate funds needed to support their business
plan.
The financial statements do not include any adjustments relating to the
recoverability or classification of recorded assets and liabilities that might
result should the Company be unable to continue as a going concern.
8
Sync2 Networks Corp
(A Development Stage Company)
Notes to the Financial Statements
March 31, 2010
(Unaudited)
4. FIXED ASSETS
Accumulated
2010 Cost Amortization Net
---- ---- ------------ ---
Computer equipment $ 58,782 $ 14,773 $ 44,009
Leasehold improvements 160,328 42,754 117,574
-------- -------- --------
$219,110 $ 57,527 $161,583
======== ======== ========
Accumulated
2009 Cost Amortization Net
---- ---- ------------ ---
Computer equipment $ -- $ -- $ --
Leasehold improvements -- -- --
-------- -------- --------
$ -- $ -- $ --
======== ======== ========
RATES OF AMORTIZATION - Computer equipment 20% per annum declining balance
- Leasehold improvements Straight line over five years
INTANGIBLE ASSET - GOODWILL
Effective February 1, 2009 the Company acquired the equipment and business of
eDevlin Architects at a cost of $643,585. Identifiable assets were valued at
their book value of $142,088 resulting in an excess cost over book value of
$501,497 recorded as goodwill with amortization of $66,866 claimed to March 31,
2010 . The goodwill is amortized over five years and is tested for impairment
annually. The Company recorded amortization of $26,570 during the nine months
ended March 31, 2010 and wrote goodwill to Nil at December 31, 2009 to reflect
the uncertainty of recovering its value over its remaining life..
5. COMMON STOCK
The authorized capital of the Company is 150,000,000 common shares with a par
value of $ 0.001 per share.
In April 2008, the Company issued 51,000,000 shares of common stock at a price
of $0.00006 per share for total cash proceeds of $3,000.
In April 2008, the Company also issued 22,100,000 shares of common stock at a
price of $0.0003 per share for total cash proceeds of $6,500.
9
Sync2 Networks Corp
(A Development Stage Company)
Notes to the Financial Statements
March 31, 2010
(Unaudited)
5. COMMON STOCK (CONTINUED)
In May 2008, the Company issued 12,750,000 shares of common stock at a price of
$0.001 per share for total cash proceeds of $15,000
Effective May 14, 2009 the Company forward split its issued shares of common
stock on the basis of seventeen new shares for one old share (17:1). All share
issuances referred to in these financial statements are post forward split.
6. INCOME TAXES
As of March 31, 2010 the Company had net operating loss carry forwards of
approximately $1,480,969 that may be available to reduce future years' taxable
income through 2029. Future tax benefits which may arise as a result of these
losses have not been recognized in these financial statements, as their
realization is determined not likely to occur and accordingly, the Company has
recorded a valuation allowance for the deferred tax asset relating to these tax
loss carry-forwards.
7. RELATED PARTY TRANSACTONS
The Company owes $846,529 to a company with a shareholder who is also a
shareholder of the Company. The loan is unsecured, does not bear interest and
has no fixed terms of repayment.
The Company owes $250,333 to a company controlled by a former officer of the
Company. The outstanding amount bears interest at 5% per annum secured by a
General Security Agreement and is due in two equal instalments September 30,
2009 and December 31, 2009.
10
FORWARD LOOKING STATEMENTS
Statements made in this Form 10-Q that are not historical or current facts are
"forward-looking statements" made pursuant to the safe harbour provisions of
Section 27A of the Securities Act of 1933 (the "Act") and Section 21E of the
Securities Exchange Act of 1934. These statements often can be identified by the
use of terms such as "may," "will," "expect," "believe," "anticipate,"
"estimate," "approximate" or "continue," or the negative thereof. We intend that
such forward-looking statements be subject to the safe harbours for such
statements. We wish to caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made. Any
forward-looking statements represent management's best judgment as to what may
occur in the future. However, forward-looking statements are subject to risks,
uncertainties and important factors beyond our control that could cause actual
results and events to differ materially from historical results of operations
and events and those presently anticipated or projected. We disclaim any
obligation subsequently to revise any forward-looking statements to reflect
events or circumstances after the date of such statement or to reflect the
occurrence of anticipated or unanticipated events.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATION
GENERAL
Sync2 Networks Corp. was incorporated under the laws of the State of Nevada on
January 16, 2008. Our registration statement was filed with the Securities and
Exchange Commission on July 25, 2008 and declared effective on August 12, 2008.
Please note that throughout this Quarterly Report, and unless otherwise noted,
the words "we," "our," "us," the "Company," "Sync2," or "Sync2 Networks" refers
to Sync2 Networks Corp.
CURRENT BUSINESS OPERATIONS
The Company engages in the business of acquiring and developing internet
marketing and web site development entities and/or their individual software
programs to assist third-party clients in marketing their products and in
maximizing the use of the internet to achieve those third-party clients'
ultimate business objectives. During the quarter ended December 31, 2009 we
shifted the direction of SYNC2 to providing support services to the gaming world
and laid off our Vancouver staff as a cost cutting measure. The Company intends
to subcontract any required professional and other services.
Over the course of the next twelve months Sync2 intends to continue with its
plan of business development and operations to assist companies, organizations
and individuals (collectively the "clients") in establishing, building,
maintaining and marketing the clients' online businesses.
11
If the Company is unable to meet its needs for cash it will be unable to
continue, develop, or expand its operations.
While the officers and directors have generally indicated a willingness to
provide services and financial contributions if necessary, there are presently
no agreements, arrangements, commitments, or specific understandings, either
verbally or in writing, between the officers and directors and Sync2.
If we are unable to pay for our expenses because we do not have enough money, we
may be forced to cease active operations until we are able to secure additional
financing. If we cannot or do not secure additional financing we may be forced
to cease active business operations.
Our auditors have issued a going concern qualification in their opinion on our
financial statements. This means that there is substantial doubt that we can
continue as an on-going business for the next twelve months unless we obtain
additional capital or other financing to pay for our expenses. The Company's
actual results could differ materially from those discussed here.
RESULTS OF OPERATION
Our financial statements have been prepared assuming that we will continue as a
going concern and, accordingly, do not include adjustments relating to the
recoverability and realization of assets and classification of liabilities that
might be necessary should we be unable to continue in operation.
We expect we will require additional capital to meet our long term operating
requirements. We expect to raise additional capital through, among other things,
the sale of equity or debt securities.
Our net loss from operations during the nine-month period ended March 31, 2010
was ($459,960) or ($0.01) per share compared to a net loss of ($4,302) or
($0.00) per share during the comparative period to March 31, 2009. The weighted
average number of shares outstanding was 85,850,000 for both periods.
During the nine-month period ended \March 31, 2010 we incurred general and
administrative expenses of approximately $10,584 compared to $794 incurred
during the comparative period to March 31, 2009. General and administrative
expenses incurred during the three-month periods were generally related to
corporate overhead and financial and administrative contracted services. During
the current period we wrote off goodwill in the amount of $468,126 because we do
not expect to recover the value.
Our net loss from operations during the nine- month period ended March 31, 2010
was ($645,325) or ($0.00) per share compared to a net loss of ($21,086) or
($0.00) per share during the comparative period to March 31,2009. The weighted
average number of shares outstanding was 85,850,000 for both periods..
12
LIQUIDITY AND CAPITAL RESOURCES
NINE MONTHS ENDED MARCH 31, 2010
As at March 31, 2010 our current assets were $47,601 and our total current
liabilities were $1,323,199 which resulted in a working capital deficit of
$(1,275,598) compared to a working capital surplus of $2,131 at March 31, 2009.
Stockholders' equity increased from a deficit of $(222,003) at the fiscal year
end June 30, 2009 to a deficit of $(1,493,115) at the nine month period ended
March 31, 2010
CASH FLOWS FROM OPERATING ACTIVITIES
We have not generated positive cash flows from operating activities. For the
nine month period ended March 31,2010 net cash flow used in operating activities
was ($178,862) consisting primarily of a net loss. Net cash flows used in
operating activities was ($20,886) for the comparative period to March 31, 2009
and consisted primarily of a net loss of ($21,086).
CASH FLOWS FROM FINANCING ACTIVITIES
We have financed our operations primarily from either advancements from related
parties or the issuance of equity and debt instruments. For the nine month
period ended March 31, 2010 we generated net cash from financing activities of
$281,300. For the period from inception (January 16, 2008) to net cash provided
by financing activities was $25,490 received from sale of common stock and a
loan from a Director.
We expect that working capital requirements will continue to be funded through a
combination of our existing funds, loans and further issuances of securities.
Our working capital requirements are expected to increase in line with the
growth of our business.
PLAN OF OPERATION AND FUNDING
Existing working capital, further loan advances and debt instruments, and
anticipated cash flow are expected to be adequate to fund our operations over
the next six months. We have no lines of credit or other bank financing
arrangements. Generally, we have financed operations to date through the
proceeds of the private placement of equity and debt instruments. In connection
with our business plan, management anticipates additional increases in operating
expenses and capital expenditures relating to: (i) acquisition of inventory;
(ii) developmental expenses associated with a start-up business; (iii)
administration costs; and (iv) marketing expenses.
We intend to finance these expenses with further issuances of securities and
debt issuances. Thereafter, we expect we will need to raise additional capital
and generate revenues to meet long-term operating requirements. Additional
issuances of equity or convertible debt securities will result in dilution to
our current shareholders. Further, such securities might have rights,
13
preferences or privileges senior to our common stock. Additional financing may
not be available upon acceptable terms, or at all. If adequate funds are not
available or are not available on acceptable terms, we may not be able to take
advantage of prospective new business endeavours or opportunities, which could
significantly and materially restrict our business operations.
MATERIAL COMMITMENTS
As of the date of this Quarterly Report, we do not have any material
commitments.
PURCHASE OF SIGNIFICANT EQUIPMENT
We do not intend to purchase any significant equipment during the next twelve
months.
OFF-BALANCE SHEET ARRANGEMENTS
As of the date of this Quarterly Report, we do not have any off-balance sheet
arrangements that have or are reasonably likely to have a current or future
effect on our financial condition, changes in financial condition, revenues or
expenses, results of operations, liquidity, capital expenditures or capital
resources that are material to investors.
GOING CONCERN
The independent auditors' report accompanying our June 30, 2009 financial
statements contained an explanatory paragraph expressing substantial doubt about
our ability to continue as a going concern. The financial statements have been
prepared "assuming that we will continue as a going concern," which contemplates
that we will realize our assets and satisfy our liabilities and commitments in
the ordinary course of business.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Market risk represents the risk of loss that may impact our financial position,
results of operations or cash flows due to adverse change in foreign currency
and interest rates.
EXCHANGE RATE
Our reporting currency is United States dollars ("USD"). Our operations are in
Canadian dollars ("Cdn$"). The fluctuation of exchange rates for the Cdn$ may
have positive or negative impacts on our results of operations.
ITEM 4. CONTROLS AND PROCEDURES
Our management is responsible for establishing and maintaining a system of
disclosure controls and procedures [as defined in Rule 13a-15(e) and 15d-15(e)
under the Exchange Act] that is designed to ensure that information required to
be disclosed by us in the reports that we file or submit under the Exchange Act
is recorded, processed, summarized and reported, within the time periods
14
specified in the Commission's rules and forms. Disclosure controls and
procedures include, without limitation, controls and procedures designed to
ensure that information required to be disclosed by an issuer in the reports
that it files or submits under the Exchange Act is accumulated and communicated
to the issuer's management, including its principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, as appropriate to allow timely decisions regarding required
disclosure.
An evaluation was conducted under the supervision and with the participation of
our management of the effectiveness of the design and operation of our
disclosure controls and procedures as of March 31,2010 Based on that evaluation,
our management concluded that our disclosure controls and procedures were
effective as of such date to ensure that information required to be disclosed in
the reports that we file or submit under the Exchange Act, is recorded,
processed, summarized and reported within the time periods specified in SEC
rules and forms. Such officer also confirmed that there was no change in our
internal control over financial reporting during the three-month period ended
December 31, 2009 that has materially affected, or is reasonably likely to
materially affect, our internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Management is not aware of any legal proceedings contemplated by any
governmental authority or any other party involving us or our properties. As of
the date of this Quarterly Report, no director, officer or affiliate is (i) a
party adverse to us in any legal proceeding, or (ii) has an adverse interest to
us in any legal proceedings. Management is not aware of any other legal
proceedings pending or that have been threatened against us or our properties.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
No report required.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
No report required.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No report required.
15
ITEM 5. OTHER INFORMATION
DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT
OF PRINCIPAL OFFICERS.
Effective October 6, 2009 the Company appointed John Moore as Director of the
Company and accepted the resignation of Helen Siwak as Director of the Company.
Mr. Moore has more than 35 years of experience in finance and business
management, and has owned and operated several businesses. Since 1983, Mr. Moore
has been the owner and operator of John Moore Financial Management Solutions,
Inc. Additionally, Mr. Moore has served as the CFO and a Director of Royal Crown
Capital Corporation (2008) and as CFO and Director of CND Baer Technologies Ltd,
Dba Lazy Bath since 2007. During 2007, he also served as CFO and Director of The
Great Canadian Karaoke Challenge Ltd and as CFO and Director of Real American
Show Down, Inc. / USA Karaoke Championships, Inc. From 2003 through 2006, Mr.
Moore served as CFO and Director of Flameret, Inc. During 2003, Mr. Moore served
as CFO and Director of Rim Bra Brake Systems, Inc. From 1997 to 2000, Mr. Moore
served as CFO and Director of Image Power, Inc.
Effective January 15, 2010 the Company appointed Ron Houle as Director of the
Company
Mr. Houle has over 20 years of experience in marketing & business development.
In 1990 Mr. Houle became VP of Technology for Intermediate Inc. where he
developed, implemented and managed the Development of a "plasma driven
Teleprompter" as well as a Computer and Electronics Service Department that
developed Cinevision editing system for the broadcast industry. Mr. Houle
started his Internet consulting business in 1995. In 1997 Mr. Houle bought
Greater Regional Technical Institute and then merged a technical training
College with a successful Internet access company. In 1997 Mr. Houle founded The
Ocean Arts & Entertainment Magazine where he held the Position of President &
Publisher. He successfully developed a readership of 150,000 plus subscribers.
In 1998 Mr. Houle sold his Interests in his Internet Consulting Company &
Greater Regional Technical Institute to Core Networking SA, and he accepted the
position of Vice President of Business Development. In 1998 Ron Houle founded
Metronome Internet Technologies (MIT) Services, Inc. Mr. Houle is now
Construction coordinator & Vice President of Metronome Canada in Toronto; he
sits on the board of directors of the Foundation and continues to contribute his
organizational and liaison skills to bring this project, the world's first music
city, to fruition. In 1998 Mr. Houle also became Vice President of Tectane Corp,
a G.E.F Partner corporation, having environmental technologies that address the
United Nations Environmental Treaty to reduce Co2 emissions worldwide.
Currently Mr. Houle is President of AMPSC Consulting Group LLC. He also sits on
the advisory board of Tectane Corp (International); Mr. Houle also represents
the International Parliament Foundation for Canada at the UN level and
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throughout Latin America. Mr. Houle has founded AMPSC Consulting Group LLC to
facilitate marketing Environmental Energy Technologies worldwide through AMPCS
network of agents.
ITEM 6. EXHIBITS
31.1 Certification of Chief Executive Officer pursuant to Securities
Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
31.2 Certification of Chief Financial Officer pursuant to Securities
Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
32.1 Certifications pursuant to Securities Exchange Act of 1934 Rule
13a-14(b) or 15d- 14(b) and 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes- Oxley Act of 2002.
32.2 Certification of Chief Financial Officer pursuant to Securities
Exchange Act of 1934 Rule 13a-14(b) or 15d- 14(b) and 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of
2002.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
SYNC2 NETWORKS CORP
Dated: November 2, 2012
By: /s/ John Moore
-----------------------------------
John Moore, President and
Chief Executive Officer
Dated: November 2, 2012
By: /s/ John Moore
-----------------------------------
John Moore, Chief Financial Officer
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