U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
[X] Quarterly Report under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended May 31, 2009
[_] Transition Report under Section 13 or 15(d) of the Exchange Act for the
Transition Period from ________ to ___________
Commission File Number: 333-123611
FUTURA PICTURES, INC.
(Exact name of small business issuer as specified in its charter)
Delaware 56-2495218
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
17337 Ventura Boulevard, Suite 208
Encino, California 91316
Issuer's Telephone Number: (818) 784-0040
(Address and phone number of principal executive offices)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or 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 has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (ss.232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files).
Yes [_] No [_]
Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See definitions of "large accelerated filer," "accelerated filer," and
"smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer [_] Accelerated filer [_]
Non-accelerated filer [_] Smaller reporting company [X]
Check whether the issuer is a "shell company" as defined in Rule 12b-2
of the Securities Exchange Act of 1934. Yes [_] No [X]
The Registrant has 1,599,750 shares of Common stock, par value $.0001
per share issued and outstanding as of June 30, 2009.
INDEX TO QUARTERLY REPORT
ON FORM 10-Q
PART I FINANCIAL INFORMATION
PAGE
----
Item 1. Financial Statements (Unaudited) 3
Condensed Balance Sheets
May 31, 2009 (Unaudited) and February 28, 2009 4
Condensed Statements of Operations
For the Three Months Ended
May 31, 2009 and 2008 5
Condensed Statements of Shareholders' Deficit
From March 1, 2009
to May 31, 2009 (Unaudited) 6
Condensed Statements of Cash Flows
For the Three Months Ended
May 31, 2009 and 2008 7
Notes to Financial Statements (Unaudited) 9
Item 2. Management's Discussion and Analysis or Plan of Operation 13
Item 3. Quantitative and Qualitative Disclosures About Market Risk 17
Item 4. Controls and Procedures 17
PART II OTHER INFORMATION
Item 1. Legal Proceedings 17
Item 2. Unregistered Sale of Equity and Use of Proceeds 17
Item 3. Defaults upon Senior Securities 17
Item 4. Submission of Matters to a Vote of Security Holders 17
Item 5. Other Information 17
Item 6. Exhibits 17
Signatures 18
2
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
(Financial Statements Commence on Following Page)
3
FUTURA PICTURES, INC.
CONDENSED BALANCE SHEETS
MAY 31, 2009 FEBRUARY 28,
(UNAUDITED) 2009
------------ ------------
ASSETS
Cash .................................................... $ 182 $ 2,672
Prepaid expenses ........................................ 235 --
Inventories ............................................. 4,975 5,000
------------ ------------
TOTAL ASSETS ....................................... $ 5,392 $ 7,672
============ ============
LIABILITIES
Accrued expenses ........................................ $ 9,442 $ 47,188
Accrued interest - related party ........................ 1,426 281
Loan payable - related party ............................ 66,457 19,457
------------ ------------
TOTAL LIABILITIES .................................. 77,325 66,926
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, par value $0.0001 per share
Authorized - 100,000,000 shares
Issued and outstanding - 1,599,750 shares .......... 160 160
Additional paid-in capital .............................. 265,540 255,140
Retained Deficit ........................................ (337,633) (314,554)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) ............... (71,933) (59,254)
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 5,392 $ 7,672
============ ============
The accompanying notes are an integral part of these financial statements.
4
FUTURA PICTURES, INC.
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
FOR THE THREE
FOR THE THREE MONTHS ENDED
MONTHS ENDED MAY 31, 2008
MAY 31, 2009 (as restated)
------------- -------------
REVENUE .................................... $ 4,460 $ --
COST OF REVENUE ............................ 671 --
------------- -------------
GROSS PROFIT ............................... 3,789 --
OPERATING EXPENSES
Selling, general and administrative ..... 25,723 24,348
------------- -------------
TOTAL OPERATING EXPENSES ............ 25,723 24,348
(LOSS) FROM OPERATIONS ..................... (21,934) (24,348)
------------- -------------
INTEREST EXPENSE ........................... 1,145 19
(LOSS) BEFORE INCOME TAXES ................. (23,079) (24,367)
Income tax expense ...................... -- 800
------------- -------------
NET (LOSS) ................................. $ (23,079) $ (25,167)
============= =============
NET (LOSS) PER COMMON SHARE
Basic and diluted ....................... $ (0.01) $ (0.02)
============= =============
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING
Basic and diluted ....................... 1,599,750 1,591,924
============= =============
The accompanying notes are an integral part of these financial statements.
5
FUTURA PICTURES, INC.
CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE PERIOD FROM DECEMBER 10, 2003
(DATE OF INCEPTION) TO MAY 31, 2009
(UNAUDITED)
TOTAL
COMMON STOCK ADDITIONAL STOCKHOLDERS'
----------------------- PAID-IN RETAINED EQUITY
SHARES AMOUNT CAPITAL DEFICIT (DEFICIT)
---------- ---------- ---------- ---------- ----------
Balance, March 1, 2009 ........ 1,599,750 $ 160 $ 255,140 $ (314,554) $ (59,254)
Contributed services .......... -- -- 10,400 -- 10,400
Net (loss) for the three months
ended May 31, 2009 ......... -- -- -- (23,079) (23,079)
---------- ---------- ---------- ---------- ----------
Balance, May 31, 2009 ......... 1,599,750 $ 160 $ 265,540 $ (337,633) $ (71,933)
========== ========== ========== ========== ==========
The accompanying notes are an integral part of these financial statements.
6
FUTURA PICTURES, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
FOR THE THREE
FOR THE THREE MONTHS ENDED
MONTHS ENDED MAY 31, 2008
MAY 31, 2009 (as restated)
------------ ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) .......................................... $ (23,079) $ (25,167)
Adjustments to reconcile net (loss) to net cash
(used) by operating activities:
Contributed services .......................... 10,400 5,150
Changes in operating assets and liabilities:
Prepaid expenses ......................... (235) 1,000
Inventories .............................. 25 --
Accrued expenses ......................... (36,601) 8,842
------------ ------------
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES .. (49,490) (10,175)
------------ ------------
CASH FLOWS (USED) BY INVESTING ACTIVITIES:
Production in progress .............................. -- (2,000)
------------ ------------
NET CASH (USED) BY INVESTING ACTIVITIES ........... -- (2,000)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from loan payable - related party .......... 47,000 --
Proceeds from sale of common stock .................. -- 12,200
------------ ------------
NET CASH PROVIDED BY FINANCING ACTIVITIES ......... 47,000 12,200
------------ ------------
NET INCREASE (DECREASE) IN CASH ........................ (2,490) 25
CASH AT THE BEGINNING OF THE YEAR ...................... 2,672 20,823
------------ ------------
CASH AT THE END OF THE YEAR ............................ $ 182 $ 20,848
============ ============
The accompanying notes are an integral part of these financial statements.
7
FUTURA PICTURES, INC.
CONDENSED STATEMENTS OF CASH FLOWS (CONTINUED)
(UNAUDITED)
FOR THE THREE FOR THE THREE
MONTHS ENDED MONTHS ENDED
MAY 31, 2009 MAY 31, 2008
------------ ------------
SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION
Interest paid ....................................... $ -- $ --
Taxes paid .......................................... $ -- $ --
The accompanying notes are an integral part of these financial statements.
8
FUTURA PICTURES, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION AND NATURE OF BUSINESS
Futura Pictures, Inc. (the "Company") was incorporated under the laws
of the state of Delaware on December 10, 2003. The Company was formed
to engage in the production and the co-financing of films,
documentaries and similar products produced solely for the distribution
directly to the domestic and international home video markets.
PRESENTATION
The interim financial statements of the Company are condensed and do
not include some of the information necessary to obtain a complete
understanding of the financial data. Management believes that all
adjustments (consisting of only normal recurring adjustments, unless
otherwise noted) necessary for a fair presentation of results have been
included in the unaudited financial statements for the interim period
presented. Operating results for the three months ended May 31, 2009
are not necessarily indicative of the results that may be expected for
the year ended February 28, 2010. Accordingly, your attention is
directed to footnote disclosures found in the February 28, 2009 Annual
Report and particularly to Note 1, which includes a summary of
significant accounting policies.
UNCLASSIFIED BALANCE SHEET
In accordance with the provisions of AICPA Statement of Position 00-2,
"ACCOUNTING BY PRODUCERS OR DISTRIBUTORS OF FILMS", the Company has
elected to present an unclassified balance sheet.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make certain estimates and assumptions that affect the
reported amounts and timing of revenues and expenses, the reported
amounts and classification of assets and liabilities, and the
disclosure of contingent assets and liabilities. These estimates and
assumptions are based on the Company's historical results as well as
management's future expectations. The Company's actual results could
vary materially from management's estimates and assumptions.
9
DISCLOSURE ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company estimates that the fair value of all financial instruments
at May 31, 2009 as defined in FASB 107 does not differ materially from
the aggregate carrying values of its financial instruments recorded in
the accompanying balance sheet. The estimated fair value amounts have
been determined by the Company using available market information and
appropriate valuation methodologies. Considerable judgment is required
in interpreting market data to develop the estimates of fair value, and
accordingly, the estimates are not necessarily indicative of the
amounts that the Company could realize in a current market exchange.
REVENUE RECOGNITION
Sales are recognized upon shipment of videos to the customer or upon
website download by the customer. The Company's products may not be
returned by the customer. Accordingly, the Company has made no
provision for returns.
INVENTORIES
Inventories represent finished DVDs of the program, "The 5
Communication Secrets That Swept Obama to the Presidency", that are
available for sale. They are valued at the lower of cost or market
using the First-In-First-Out method of accounting.
PRODUCTION COSTS
The Company expenses production costs as incurred when the costs are
related to videos where there is no historical revenue to aid the
Company in accurately forecasting revenues to be earned on the related
videos.
RECENT PRONOUNCEMENTS
In February 2007, the Financial Accounting Standards Board (the "FASB")
issued Statements of Financial Accounting Standards ("SFAS") NO. 159,
"The Fair Value Option for Financial Assets and Financial
Liabilities--Including an amendment of FASB Statement No. 115" (SFAS
159"). SFAS 159 permits entities to choose to measure many financial
instruments and certain other items at fair value. The objective is to
improve financial reporting by providing entities with the opportunity
to mitigate volatility in reported earnings caused by measuring related
assets and liabilities differently without having to apply complex
hedge accounting provisions. This Statement is expected to expand the
use of fair value measurement, which is consistent with the Board's
long-term measurement objectives for accounting for financial
instruments. This Statement is effective as of the beginning of an
entity's first fiscal year that begins after November 15, 2007. Early
adoption is permitted as of the beginning of a fiscal year that begins
on or before November 15, 2007, provided the entity also elects to
apply the provisions of FASB Statement No. 157, FAIR VALUE
MEASUREMENTS. The Company adopted SFAS No. 159 on March 1, 2008 and did
not elect the fair value option for any existing eligible items.
10
In April 2009, FASB issued FSP No. 115-2 and FAS 124-2, RECOGNITION AND
PRESENTATION OF OTHER-THAN-TEMPORARY IMPAIRMENTS This FSP amends the
other-than-temporary impairment guidance in U.S. GAAP for debt
securities to make the guidance more operational and to improve the
presentation and disclosure of the other-than-temporary impairments on
debt and equity securities in the financial statements. The FSP is
effective for interim and annual reporting periods ending after June
15, 2009. The Company is currently analyzing the impact this FSP will
have on its financial statements.
In May 2009, the FASB issued Statement No. 165, SUBSEQUENT EVENTS
("SFAS 165"). SFAS 165 requires entities to disclose the date through
which they have evaluated subsequent events and whether the date
corresponds with the release of their financial statements. Effective
for interim and annual periods ending after June 15, 2009, SFAS 165
will become effective in the next reporting quarter. SFAS 165 should
not have an impact on our financial condition, results of operations or
cash flows.
In June 2009, the FASB issued Statement No. 168, THE FASB ACCOUNTING
STANDARDS CODIFICATION AND THE HIERARCHY OF GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES ("SFAS 168"). SFAS 168 will become the single
source of authoritative nongovernmental U.S. generally accepted
accounting principles ("GAAP"), superseding existing FASB, American
Institute of Certified Public Accountants ("AICPA"), Emerging Issues
Task Force ("EITF"), and related accounting literature. SFAS 168
reorganizes the thousands of GAAP pronouncements into roughly 90
accounting topics and displays them using a consistent structure. Also
included is relevant Securities and Exchange Commission guidance
organized using the same topical structure in separate sections. SFAS
168 will be effective for financial statements issued for reporting
periods that end after September 15, 2009. This will have an impact on
the Company's financial statements since all future references to
authoritative accounting literature will be references in accordance
with SFAS 168.
Additionally, there are no recently issued accounting standards with
pending adoptions that the Company's management currently anticipates
will have any material impact upon its financial statements.
11
NOTE 2 SIGNIFICANT UNCERTAINTY REGARDING THE COMPANY'S ABILITY TO CONTINUE AS
A GOING CONCERN AND MANAGEMENT PLANS
The accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. The
Company's current financial resources are not considered adequate to
fund its planned operations. This condition raises substantial doubt
about its ability to continue as a going concern. The accompanying
financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the
amounts and classification of liabilities that might be necessary
should the Company be unable to continue as a going concern.
The Company's continuation as a going concern currently is dependent
upon timely procuring significant external debt and/or equity financing
to fund its immediate and near-term operations, and subsequently
realizing operating cash flows from sales of its film products
sufficient to sustain its longer-term operations and growth
initiatives, including its desired marketing and new potential film
screenplays.
NOTE 3 DEVELOPMENT STAGE OPERATIONS
During the quarter ended May 31, 2009, the Company began sales of its
DVD, "The 5 Communication Secrets That Swept Obama to the Presidency".
Accordingly, the Company is no longer considered to be in the
Development Stage.
NOTE 4 RELATED PARTY TRANSACTION
LOAN COMMITMENT
The Company's President, Buddy Young, agreed to lend up to $100,000 to
the Company to fund any cash shortfalls through February 28, 2010. The
note bears interest at 8% and is due upon demand, no later than June
30, 2010. The outstanding balance was $66,457 as of May 31, 2009.
NOTE 5 STOCKHOLDERS' DEFICIT
For the three months ended May 31, 2009 and 2008, the Company's
President devoted time to the development process of the Company.
Compensation expense totaling $10,400 has been recorded in each period.
Of this amount, the President was paid $-0- and $5,250 during the three
months ended May 31, 2009 and 2008, respectively. The President has
waived reimbursement of $10,400 and $5,150 during the three months
ended May 31, 2009 and 2008, respectively, and, accordingly, the
amounts have been recorded as a contribution to capital.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
You should read this section together with our financial statements and
related notes thereto included elsewhere in this report. In addition to the
historical information contained herein, this report contains forward-looking
statements that are subject to risks and uncertainties. Forward-looking
statements are not based on historical information but relate to future
operations, strategies, financial results or other developments. Forward-looking
statements are necessarily based upon estimates and assumptions that are
inherently subject to significant business, economic and competitive
uncertainties and contingencies, many of which are beyond our control and many
of which, with respect to future business decisions, are subject to change.
Certain statements contained in this Form 10, including, without limitation,
statements containing the words "believe," "anticipate," "estimate," "expect,"
"are of the opinion that" and words of similar import, constitute
"forward-looking statements." You should not place any undue reliance on these
forward-looking statements.
You should be aware that our results from operations could materially
be effected by a number of factors, which include, but are not limited to the
following: economic and business conditions specific to the motion picture,
television, and home video industries; competition from other producers of home
video content; and television documentaries, our ability to control costs and
expenses, access to capital, and our ability to meet contractual obligations.
There may be other factors not mentioned above or included elsewhere in this
report that may cause actual results to differ materially from any
forward-looking information.
CRITICAL ACCOUNTING POLICIES
Our discussion and analysis of our financial condition and results of
operations are based upon our statements, which have been prepared in accordance
with accounting principles generally accepted in the United States. The
preparation of these financial statements requires us to make estimates and
judgments that affect the reported amounts of assets, liabilities, revenues and
expenses. In consultation with our Board of Directors, we have identified two
accounting policies that we believe are key to an understanding of our financial
statements. These are important accounting policies that require management's
most difficult, subjective judgment.
GOING CONCERN. The accompanying financial statements have been prepared
on a going concern basis, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. The Company's
current financial resources are not considered adequate to fund its planned
operations. This condition raises substantial doubt about its ability to
continue as a going concern. The accompanying financial statements do not
include any adjustments relating to the recoverability and classification of
recorded asset amounts or the amounts and classification of liabilities that
might be necessary should the Company be unable to continue as a going concern.
13
The Company's continuation as a going concern currently is dependent
upon timely procuring significant external debt and/or equity financing to fund
its immediate and near-term operations, and subsequently realizing operating
cash flows from sales of its film products sufficient to sustain its longer-term
operations and growth initiatives, including its desired marketing and new
potential film screenplays.
NON-CASH EQUITY ISSUANCES. We periodically issue shares of our common
stock in exchange for, or in settlement of, services. Our management values the
shares issued in such transactions at either the then market value of our common
stock, as determined by the Board of Directors and after taking into
consideration factors such as the volume of shares issued or trading
restrictions, or the value of the services received, whichever is more readily
determinable.
SELECT FINANCIAL INFORMATION
FOR THE THREE MONTHS ENDED
------------------------------------
MAY 31, 2008
MAY 31, 2009 (UNAUDITED-
(UNAUDITED) -AS RESTATED)
--------------- ---------------
Statement of Operations Data
Total revenue ........................ $ 4,460 $ --
Operating loss ....................... $ (23,079) $ (24,367)
Net loss after taxes ................. $ (23,079) $ (25,167)
Net loss per share ................... $ (0.01) $ (0.02)
Balance Sheet Data
Total assets ......................... $ 5,392 $ 33,848
Total liabilities .................... $ 77,325 $ 38,548
Stockholder's equity (deficit) ....... $ (71,933) $ (4,700)
THREE-MONTH PERIOD ENDED MAY 31, 2009 COMPARED TO THREE-MONTH PERIOD ENDED MAY
31, 2008
GENERAL
In November 2008, the Company commenced production on a 47 minute
"self-improvement" DVD entitled, "THE 5 SECRETS OF COMMUNICATION THAT SWEPT
OBAMA TO THE PRESIDENCY." During the three months ended May 31, 2009, the
Company began sales of the DVD.
The DVD uses video examples of President Barack Obama's most memorable
speeches to illustrate five essential secrets of effective public and personal
communication. International communication analyst and coach Richard Greene
hosts the DVD and instructs in the system of communication techniques he
created. The DVD was completed in February 2009, and is being sold via the
internet and through distributors specializing in the sale of product to the
educational market, i.e. libraries, universities etc.
14
REVENUES
Our revenues for the three months ended May 31, 2009 were $4,460. These
revenues were a result of the initial sales of "THE 5 SECRETS OF COMMUNICATION
THAT SWEPT OBAMA TO THE PRESIDENCY" DVD. There were no revenues during the three
months ended May 31, 2008.
The cost of revenues during the three months ended May 31, 2009, was
$671. As there were no revenues during the three months ended May 31, 2008, no
costs were incurred.
EXPENSES
Selling, general and administrative expenses were $25,723 during the
three months ended May 31, 2009 as compared to $24,348 during the three months
ended May 31, 2008.
Selling and marketing expenses were $8,123 for the three months ended
May 31, 2009 as compared to $ 0 for the three months ended May 31, 2008. These
costs are mainly related to the marketing of "THE 5 SECRETS OF COMMUNICATION
THAT SWEPT OBAMA TO THE PRESIDENCY" DVD.
During the three month period ended May 31, 2009, we incurred a total
of $17,600 in general and administrative expenses. This consisted primarily of
$10,400 of contributed services by our CEO, Buddy Young, and $5,325 of
professional fees incurred for our audited financial statements and related
filings. We valued the contributed services from Buddy Young at $100 per hour.
During the same period in 2008, we incurred a total of $24,348 general and
administrative expenses. This consisted primarily of $5,150 of contributed
services by our CEO, Buddy Young, $5,250 of compensation expense paid to our
CEO, Buddy Young, and $9,198 of professional fees incurred for our audited
financial statements and related filings.
We incurred $1,145 and $19 in interest expense during the three months
ended May 31, 2009 and 2008, respectively. This is related to the interest
charges we incur on our loan from Buddy Young.
While we cannot guarantee the level of our expenses in the future, we
anticipate them to increase as we develop new educational/self improvement DVDs.
PLAN OF OPERATION
During the past twelve months we worked on producing a television
documentary under the terms of the agreement signed in December 2007 with the
Hathaway Group. As a result of the termination of that agreement in February
2009, all worked ceased on the documentary. Given our inability to date to raise
the necessary capital to implement our business plan of producing and
co-financing low budget motion pictures, and the current difficulty in raising
15
capital caused by general market conditions, management has decided to put that
element of the plan on hold, and to focus its efforts during the next 12 months
on producing educational/self-improvement DVDs whose production budgets range
between fifty and one hundred thousand dollars. Additionally, we will work to
maximize the revenue potential of the DVD that we completed during the first
quarter of fiscal 2009, entitled "THE FIVE SECRETS OF COMMUNICATION THAT SWEPT
OBAMA TO THE PRESIDENCY." There can be no assurance that we will ever be able to
raise sufficient fund to permit us to produce or co-finance low budget motion
pictures.
"THE FIVE SECRETS OF COMMUNICATION THAT SWEPT OBAMA TO THE PRESIDENCY,"
has generated $4,460 in revenue during the first three months of fiscal 2010. We
anticipate that cash resulting from the further sales and licensing of "THE FIVE
SECRETS OF COMMUNICATION THAT SWEPT OBAMA TO THE PRESIDENCY." or funds provided
to us by our president and principal shareholder, under a promissory note dated
February 16, 2005, as amended, will be sufficient to fund our cash requirements
to continue our efforts through February 2010.
If during the next twelve months our revenue is insufficient to
continue operations, and we are unable to raise funds through the sale of
additional equity, or from traditional borrowing sources, we may be required to
scale back our planned operations, or be forced to totally abandon our business
plan and seek other business opportunities in a related or unrelated industry.
Such opportunities may include a reverse merger with a privately held company.
The result of which could cause the existing shareholders to be severely
diluted.
EMPLOYEES
Due to our very limited financial resources, the Company's President,
Buddy Young, along with Joseph Adelman, and Mel Powell, our Director of
acquisitions, work on a part-time basis. Other than Mr. Young, no employee has
received cash compensation from the Company. We have no other full-time or
part-time employees. Additionally, we regularly utilize the services of
independent firms to handle our accounting and certain administrative matters.
If and when our capital resource permits, we will hire full-time professional
and administrative employees.
LIQUIDITY AND CAPITAL RESOURCES
We had a cash balance of $182 on May 31, 2009. Other than funds
received from the sale of "THE FIVE SECRETS OF COMMUNICATION THAT SWEPT OBAMA TO
THE PRESIDENCY,", at this time, our only other known cash resource comes from an
agreement with our President and majority shareholder to fund any shortfall in
cash flow up to $100,000 at 8% interest through February 28, 2010. As of May 31,
2009 the balance owing on this agreement is $66,457. Payment of principal and
interest is due on this loan on June 30, 2010.
We believe that revenue derived from the sale of the above mentioned
DVD, and further borrowings from our President will be sufficient to satisfy our
budgeted cash requirements through February 28, 2010.
16
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Based on the nature of our current operations, we have not identified
any issues of market risk at this time.
ITEM 4. CONTROLS AND PROCEDURES
The principal executive officer and principal financial officer of the
Company, who are the same person ("the Certifying Officer") with the assistance
of advisors, evaluated the effectiveness of the design and operation of the
Company's disclosure controls and procedures (as defined in section
240.13a-14(c) and 240.15d-14(c) under the Exchange Act) within 90 days prior to
the filing of this report. Based upon the evaluation, the Certifying Officer
concludes that the Company's disclosure controls and procedures are effective in
timely alerting management to material information relative to the Company which
is required to be disclosed in its periodic filings with the SEC.
There were no significant changes in the Company's internal controls or
in other factors that could significantly affect these controls subsequent to
the date of their evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the quarter ended May 31, 2009, no matters were submitted to the
Company's security holders.
ITEM 5. OTHER INFORMATION None.
ITEM 6. EXHIBITS
31.1 Certification of CEO Pursuant to Securities Exchange Act Rules
13a-14 and 15d-14, as Adopted Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
32.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
17
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.
FUTURA PICTURES, INC.
(Registrant)
Dated: July 15, 2009 /S/ BUDDY YOUNG
------------------------------------
Buddy Young, President and Chief
Executive Officer
18