Kingfish Holding Corp - Quarter Report: 2015 March (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2015

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 000-52375

(941) 870-2986

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ¨ No x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§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 x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes x No ¨

As of May 13, 2015, the number of issued and outstanding shares of common stock of the registrant was 116,712,987.

KINGFISH HOLDING CORPORATION

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

KINGFISH HOLDING CORPORATION

BALANCE SHEETS

MARCH 31, 2015 AND SEPTEMBER 30, 2014

The accompanying notes are an integral part of the financial statements

KINGFISH HOLDING CORPORATION

STATEMENTS OF OPERATIONS - UNAUDITED

FOR THE THREE AND SIX MONTHS ENDED MARCH 31, 2015 AND 2014

The accompanying notes are an integral part of the financial statements.

KINGFISH HOLDING CORPORATION

STATEMENTS OF CASH FLOWS - UNAUDITED

FOR THE SIX MONTHS ENDED MARCH 31, 2015 AND 2014

The accompanying notes are an integral part of the financial statements.

KINGFISH HOLDING CORPORATION

NOTES TO FINANCIAL STATEMENTS

March 31, 2015

(unaudited)

1.      Business:

Our Business:

Kingfish Holding Corporation (the “Company”) was incorporated in the State of Delaware on April 11, 2006 as Offline Consulting, Inc. It became Kesselring Holding Corporation on June 8, 2007 and on November 25, 2014 it changed its name to Kingfish Holding Corporation. The Company was engaged in (i) restoration services, principally to commercial property owners, (ii) the manufacture and sale of cabinetry and remodeling products, principally to contractors and (iii) multifamily and commercial remodeling and building services on customer owned properties.

The Company discontinued operations in 2009, sold our last subsidiary in May 2010 and effected a change in management and control at the same time. As part of this transition, old management took possession of the majority of the accounting and corporate records. The Company’s last annual report Form 10-KSB for the year ended September 30, 2008 was filed with the Securities and Exchange Commission (SEC) on December 29, 2008 and the Company’s last quarterly report Form 10-Q for the period ended June 30, 2009 was filed with the SEC on August 19, 2009.

On December 17, 2014, the Company reactivated its suspended reporting obligations under Section 15(d) of the Exchange Act by filing a Form 10-K for the fiscal year ended September 30, 2013 and Forms 10-Q for the quarters ended December 31, 2013, March 31, 2014 and June 30, 2014. The Company's activities are subject to significant risks and uncertainties, including failing to secure additional funding to reorganize and finding a suitable candidate to participate in its renewable energy initiatives.

2.      Summary of Significant Accounting Policies: 

Basis of presentation:

The accompanying financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and reflect all adjustments, consisting solely of normal recurring adjustments, needed to fairly present the financial results for these periods. The financial statements and notes are presented as permitted by Form 10-Q. Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance U.S. GAAP have been omitted.

The accompanying financial statements should be read in conjunction with the financial statements for the fiscal years ended September 30, 2014 and 2013 and notes thereto in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2014. Operating results for the three and six months ended March 31, 2015 and 2014 are not necessarily indicative of the results that may be expected for the entire year. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of (a) the results of operations for the three and six month periods ended March 31, 2015 and 2014, (b) the financial position at March 31, 2015, and (c) cash flows for the six month periods ended March 31, 2015 and 2014, have been made.

KINGFISH HOLDING CORPORATION

NOTES TO FINANCIAL STATEMENTS

March 31, 2015

(unaudited)

2.      Summary of Significant Accounting Policies (continued):

The preparation of financial statements in accordance with Accounting Principles Generally Accepted in the United States of America contemplates that the Company will continue as a going concern, for a reasonable period. As reflected in the Company’s financial statements, the Company has a retained deficit of $6,558,496 on March 31, 2015. The Company used cash of ($110,081) and ($24,123) in operating activities during the six months ended March 31, 2015 and 2014, respectively. The Company has a working capital deficiency of ($1,959,420) at March 31, 2015 that is insufficient in management‘s view to sustain current levels of operations for a reasonable period without additional financing. These trends and conditions continue to raise substantial doubt surrounding the Company’s ability to continue as a going concern for a reasonable period. Ultimately, the Company’s ability to continue as a going concern is dependent upon management’s ability to continue to curtail current operating expense and obtain additional financing to augment working capital requirements and support acquisition plans. There can be no assurance that management will be successful in achieving these objectives or obtain financing under terms and conditions that are suitable. The accompanying financial statements do not include any adjustments associated with these uncertainties.

Use of estimates:

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets, if any at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Cash:

Cash is maintained at a financial institution and, at times, balance may exceed federally insured limits. We have never experienced any losses related to the balance. Currently, the FDIC provides insurance coverage up to $250,000 per depositor at each financial institution and our cash balance did not exceed such coverage on March 31, 2015.

For purpose our statements of cash flows, the Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash.

Prepaid expense:

Prepaid expense consisted of payments to professional for services to be rendered at a later date.

Income Taxes:

Deferred taxes are provided on the asset and liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Future tax benefits for net operating loss carry forwards are recognized to the extent that realization of these benefits is considered more likely than not. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

KINGFISH HOLDING CORPORATION

NOTES TO FINANCIAL STATEMENTS

March 31, 2015

(unaudited)

2.      Summary of Significant Accounting Policies (continued):

The Company follows the provisions of FASB ASC 740-10 “Uncertainty in Income Taxes” (ASC 740-10). A reconciliation of the beginning and ending amount of unrecognized tax benefits has not been provided since there are no unrecognized benefits for all periods presented. The Company has not recognized interest expense or penalties as a result of the implementation of ASC 740-10. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefit in interest expense and penalties in operating expenses.

Net income (loss) per share:

Basic income (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of outstanding common shares during the period of computation. Diluted loss per share gives effect to potentially dilutive common shares outstanding. The Company gives effect to these dilutive securities using the Treasury Stock Method. Potentially dilutive securities include convertible financial instruments. The Company gives effect to these dilutive securities using the If-Converted-Method. At March 31, 2015, convertible notes payable to related party of $210,000 can potentially convert into 21,000,000 shares of common stock. These shares have been excluded from the diluted net loss per share calculations because the effect of including them would be anti-dilutive.

3.      Accounts Payable and Accrued Expenses:

Accounts payable and accrued expenses are comprised of the followings:

As a result of the lack of documentation of payments or settlement agreements for reason described in Note 1, the Company was not able to definitively determine that approximately $1,972,000 and $1,997,000 these liabilities at March 31, 2015 and September 30, 2014, respectively, were settled with our vendors. Therefore, these liabilities will remain on the Company’s books until the statute of limitation expires which the Company estimates to be approximately 2015.

KINGFISH HOLDING CORPORATION

NOTES TO FINANCIAL STATEMENTS

March 31, 2015

(unaudited)

4.      Notes Payable:

Notes payable consisted of the following at March 31, 2015 and September 30, 2014:

The above notes were entered into with various financial institutions when the Company was an operating company. However, due to the lack of documentation of payments or settlement agreements for reason described in Note 1, the Company was not able to definitively determine that these notes were settled even though it appeared that the financial institutions repossessed the underlying collaterals. Therefore, these notes will remain on our books until the statute of limitation expires which we estimate to be between 2015 and 2017.

5.      Convertible Notes Payable to Related Party:

On February 20, 2013, the Company entered into a convertible note with a director for $5,000. The note bears interest rate at 3% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 15, 2013. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price which is the average of the mean of the bid and ask prices for the ninety consecutive full trading days in which the shares were traded ending at the close of trading on the fifth business day preceding the conversion date. As a result of the variable feature associated with the conversion option, pursuant to ASC Topic 815, the Company bifurcated the conversion option, to determine the fair value of the conversion option. At the issuance date and thereafter, the Company concluded that the derivative liability and the debt discount were not material to the financial statements.

On February 20, 2013, the Company entered into a convertible note with a director for $30,000. The note bears interest rate at 3% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 15, 2013. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price which is the average of the mean of the bid and ask prices for the ninety consecutive full trading days in which the shares were traded ending at the close of trading on the fifth business day preceding the conversion date. As a result of the variable feature associated with the conversion option, pursuant to ASC Topic 815, the Company bifurcated the conversion option, to determine the fair value of the conversion option. At the issuance date and thereafter, the Company concluded that the derivative liability and the debt discount were not material to the financial statements.

KINGFISH HOLDING CORPORATION

NOTES TO FINANCIAL STATEMENTS

March 31, 2015

(unaudited)

5.      Convertible Notes Payable to Related Party (continued):

On July 2, 2013, the director elected to convert the above two notes into the Company’s common stock. The conversion price was determined to be $0.0029, resulting in the issuance of 11,999,999 shares of common stock to the director.

On August 22, 2013, the Company entered into a convertible note with a director for $50,000. The note bears interest rate at 4% per annum and all unpaid principle and interest were due on demand by the director but no earlier than August 30, 2013. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price which is the average of the closing prices for the ninety consecutive full trading days in which the shares were traded ending at the close of trading on the fifth business day preceding the conversion date. As a result of the variable feature associated with the conversion option, pursuant to ASC Topic 815, the Company bifurcated the conversion option, to determine the fair value of the conversion option. At the issuance date and thereafter, the Company concluded that the derivative liability and the debt discount were not material to the financial statements.

On August 31, 2013, the director elected to convert the above note into the Company’s common stock. The conversion price was determined to be $0.00075, resulting in the conversion into 66,666,667 shares of common stock to the director. These shares were issued to the director subsequent to September 30, 2013, therefore, the Company recorded a common stock payable for $50,000 at September 30, 2013.

On October 21, 2013, the Company entered into a convertible note with a director for $10,000. The note bears interest rate at 3.5% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 1, 2015 or 30 calendar days after the recommencement of the public company status as defined in the note agreement. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price of $0.01 per share.

On November 13, 2013, the Company entered into a convertible note with a director for $10,000. The note bears interest rate at 3.5% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 1, 2015 or 30 calendar days after the recommencement of the public company status as defined in the note agreement. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price of $0.01 per share.

On January 13, 2014, the Company entered into a convertible note with a director for $10,000. The note bears interest rate at 3.5% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 1, 2015 or 30 calendar days after the recommencement of the public company status as defined in the note agreement. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price of $0.01 per share.

On April 24, 2014, the Company entered into a convertible note with a director for $20,000. The note bears interest rate at 3.5% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 1, 2015 or 30 calendar days after the recommencement of the public company status as defined in the note agreement. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price of $0.01 per share.

KINGFISH HOLDING CORPORATION

NOTES TO FINANCIAL STATEMENTS

March 31, 2015

(unaudited)

5.     Convertible Notes Payable to Related Party (continued):

On May 22, 2014, the Company entered into a convertible note with a director for $20,000. The note bears interest rate at 3.5% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 1, 2015 or 30 calendar days after the recommencement of the public company status as defined in the note agreement. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price of $0.01 per share.

On September 17, 2014, the Company entered into a convertible note with a director for $20,000. The note bears interest rate at 3.5% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 1, 2015 or 30 calendar days after the recommencement of public company status as defined in the note agreement. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price of $0.01 per share.

On February 10, 2015, the Company entered into a convertible note with a director for $60,000 advanced during the quarter ended December 31, 2014. The note bears interest rate at 3.5% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 1, 2015 or 30 calendar days after the recommencement of public company status as defined in the note agreement. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at a fixed price of $.01 per share.

On May 13, 2015, the Company entered into a convertible note with a director for $20,000 advanced during the quarter ended March 31, 2015. The note bears interest rate at 3.5% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 1, 2015 or 30 calendar days after the recommencement of the public company status as defined in the note agreement. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price of $0.01 per share.

On May 13, 2015, the Company entered into a convertible note with a director for $40,000 advanced during the quarter ended March 31, 2015. The note bears interest rate at 3.5% per annum and all unpaid principle and interest were due on demand by the director but no earlier than June 1, 2015 or 30 calendar days after the recommencement of the public company status as defined in the note agreement. The outstanding principle balance of the note is convertible into the Company’s shares of common stock at the conversion price of $0.01 per share.

6.      Preferred Stock

The Company is authorized to issue up to 20,000,000 shares of Preferred Stock with designations, rights and preferences determined from time to time by our Board of Directors. Accordingly, our Board of Directors is empowered, without shareholder approval, to issue Preferred Stock with dividend, liquidation, conversion, voting or other rights that could adversely affect the voting power or other rights of the holders of our Common Stock. The terms of the preferred stock have not been approved. As of March 31, 2015 and September 30, 2014, there was no Preferred Stock issued and outstanding, respectively.

KINGFISH HOLDING CORPORATION

NOTES TO FINANCIAL STATEMENTS

March 31, 2015

(unaudited)

7.      Rescission Liability:

On November 20, 2009, the Company issued 2,000,000 shares of its common stock to pay for services valued at $20,000. The issuance of these shares was declared invalid by the court since they were issued by prior management who did not have the authority to do so since they were validly removed on November 16, 2009. These shares remained outstanding at March 31, 2015 and will be returned to the Company’s transfer agent upon locating the holder of these shares.

8.      Recent Accounting Pronouncement

In August 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-15, “Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). ASU 2014-15 is intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Management is currently assessing the impact the adoption of ASU 2014-15 will have on our financial statements.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this quarterly report. Historical results and trends which might appear should not be taken as indicative of future operations. Our results of operations and financial condition, as reflected in the accompanying statements and related notes, are subject to management’s evaluation and interpretations of business conditions, changing market conditions and other factors.

A NOTE ABOUT FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (including the exhibits hereto) contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, such as statements relating to our financial condition, results of operations, plans, objectives, future performance or expectations, and business operations. These statements relate to expectations concerning matters that are not historical fact. Accordingly, statements that are based on management’s projections, estimates, assumptions, and judgments constitute forward-looking statements. These forward-looking statements are typically identified by words or phrases such as “believe,” “expect,” “anticipate,” “plan,” “estimate,” “approximately,” “intend,” “objective,” “goal,” “project,” and other similar words and expressions, or future or conditional verbs such as “will,” “should,” “would,” “could,” and “may.” These forward-looking statements are based largely on information currently available to our management and on our current expectations, assumptions, plans, estimates, judgments and projections about our business and our industry, and such statements involve inherent risks and uncertainties. Although we believe our expectations are based on reasonable estimates and assumptions, they are not guarantees of performance and there are a number of known and unknown risks, uncertainties, contingencies, and other factors (many of which are outside our control) which may cause actual results, performance, or achievements to differ materially from those expressed or implied by such forward-looking statements. Accordingly, there is no assurance that our expectations will in fact occur or that our estimates or assumptions will be correct, and we caution investors and all others not to place undue reliance on such forward-looking statements.

These potential risks and uncertainties include, but are not limited to, our ability to identify, secure and obtain suitable and sufficient financing to continue as a going concern; our ability to identify, enter into and close an appropriate a merger, acquisition, or other combination transaction with a business prospect; economic, political and market conditions; the general scrutiny and limitations placed on “blank check” and “shell” companies under applicable governmental regulatory oversight; interest rate risk; government and industry regulation that might affect future operations; potential change of control transactions resulting from merger, acquisition, or combination with a business prospect; the potential dilution in our equity (both economically and in voting power) that might result from future financing or from merger, acquisition, or combination activities; and other factors.

All written or oral forward-looking statements that are made or attributable to us are expressly qualified in their entirety by this cautionary notice. The forward-looking statements included herein are only made as of the date of this Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2015 (this “Form 10-Q”). We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

Operations. Historically, we were engaged in the business of homebuilding and restoration operations in central Florida and in the manufacture of building products from operations located in the State of Washington. During the fiscal year ended September 30, 2010, the Company defaulted on its loan agreements with AMI Holdings, Inc. ("AMI") and on May 24, 2010 AMI foreclosed on and took possession of all of the Company’s then-existing operating entities. Following the foreclosure, the Company has not engaged in any business activities and has conducted only minimal operations.

During the fiscal year ended September 30, 2012, our management concluded that it may be feasible to acquire a target company or business seeking the perceived advantages of being a publicly held corporation and ,as a result, our management determined that it should explore opportunities to acquire other assets or business operations that will maximize shareholder value. However, it was determined that prior to undertaking a search for any such acquisition opportunities, the Company should take the steps necessary to (a) reconstitute a full board of directors, (b) update and complete its corporate records and corporate governance documents, including the payment of any franchise fees and taxes owed to the State of Delaware, (c) satisfy all its obligations owed to its transfer agent, (e) obtain an audit of its financial statements by independent registered public accountants, and (f) reactivate its suspended reporting obligations under Section 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) (collectively, “Preparatory Actions”).

Following that determination, as an initial step, the Company made arrangements to take the Preparatory Actions and, as a result, the operations of the Company through December 17, 2014 were focused on preparing the Company for reactivation of its suspended reporting obligations under Section 15(d) of the Exchange Act. On December 17, 2014, the Company re-activated its filing obligations under the Exchange Act by filing a Form 10-K for the fiscal year ended September 30, 2013 and Quarterly Report on Forms 10-Q for the quarters ended December 31, 2013, March 31, 2014, and June 30, 2014 (the “Reactivation Date”).

Our plan is to seek a business venture in which to participate. The selection of a business opportunity in which to participate is complex and extremely risky and will be made by management in the exercise of its business judgment. No assurance can be given that we will be able to identify a suitable target or, if identified, that we will be able to successfully negotiate and agree upon terms acceptable to the Company or to successfully complete and close the proposed acquisition or business combination. No specific assets or businesses have yet been identified and there is no certainty that any such assets or business will be identified or any transactions will be consummated.

We expect to pursue our search for a business opportunity primarily through our officers and directors, although other sources, such as professional advisors, securities broker-dealers, venture capitalists, members of the financial community, and others, may present unsolicited proposals. Our activities are subject to several significant risks that arise primarily as a result of the fact that we have no specific target company or business and may acquire or participate in a business opportunity based on the decision of management which will, in all probability, act without the consent, vote, or approval of our shareholders. For a more detailed discussion of the manner in which we will pursue the search for and participation in a business venture, please see “Item 1: Business” of our Form 10-K filed the fiscal year ended September 30, 2014.

Financial Condition. We have not recorded revenues from operations during the fiscal quarter covered by our financial statements included in this Form 10-Q and are not currently engaged in any business activities that provide cash flows. We do not expect to generate any revenues during the current fiscal year. Our principal business objective for the current fiscal year and beyond such time will be to achieve long-term growth potential through a combination with a business. We will not restrict our potential candidate target companies to any specific business, industry or geographical location and, thus, may acquire any type of business. During the remainder of this fiscal year and the next fiscal year we anticipate incurring costs related to: (i) investigating and analyzing potential business combination transactions; (ii) the preparation and filing of Exchange Act reports, and (iii) consummating an acquisition, if any. We believe we will be able to meet these costs through use of funds in our treasury and additional amounts, as necessary, to be loaned by or invested in us by our shareholders, management or other investors.

We have no specific plans, understandings or agreements with respect to the raising of such funds, and we may seek to raise the required capital by the issuance of equity or debt securities or by other means. Since we have no such arrangements or plans currently in effect, our inability to raise funds for the consummation of an acquisition may have a severe negative impact on our ability to become a viable company.

We have negative working capital, negative shareholders’ equity and have not earned any revenues from operations since the fiscal year ended September 30, 2014. James K. Toomey, the Company’s principal stockholder and a director (“Mr. Toomey”), has loaned the Company monies in the past to cover our operations and Preparatory Actions. However, we have no formal commitment that he will continue to provide the Company with working capital sufficient until we consummate a merger or other business combination with a target company or business operation. We are currently devoting our efforts to locating such targets. Our ability to continue as a going concern is dependent upon our ability to develop additional sources of capital, locate and complete a merger with another company, and ultimately, achieve profitable operations. Our historical operating results disclosed in this Form 10-Q are not meaningful to our future results.

Going Concern Issues

In its report dated December 29, 2014, our auditors, Warren Averett, LLC expressed an opinion that there is substantial doubt about our ability to continue as a going concern. Our financial statements do not include any adjustments that may result from the outcome of this uncertainty. We have generated no operating revenues for the fiscal year ended September 30, 2014 or during the six-months ended March 31, 2015, and we had an accumulated deficit of $2,436,879 as of March 31, 2015. Furthermore, at March 31, 2015, we had a retained deficit of $6,558,496 and a working capital deficit of $1,959,420. As a result of our working capital deficit and anticipated operating costs for the next 12 months, we do not have sufficient funds available to sustain our operations for a reasonable period without additional financing. Our continuation as a going concern is dependent upon future events, including our ability to raise additional capital and to generate positive cash flows.

Results of Operations

Comparison of Three Months Ended March 31, 2015 and 2014

Revenues. Because we currently do not have any business operations, we have not had any revenues during the three months ended March 31, 2015 and March 31, 2014.

General and Administrative Expenses. We had operating expenses of $17,609 and $26,403 for the three months ended March 31, 2015 and March 31, 2014, respectively. These expenses consisted of general and administrative expenses which were primarily comprised of professional fees associated with various corporate and accounting matters. The decrease in such expenses for the three months ended March 31, 2015 as compared to the same period ended March 31, 2014 last year was due to the increased level of activities taken in 2014 to complete the Preparatory Actions and make all of the required filings with the SEC to reactivate the Company’s suspended reporting obligations under Section 15(d) of the Exchange Act. Following completion of these activities in the quarter ended December 31, 2014, our general and administrative expenses have decreased and are anticipated to remain relatively low until such time as we effect a merger or other business combination with an operating business, if at all.

Net Income (Loss). We incurred net losses for the three months ended March 31, 2015 and March 31, 2014 of $17,609 and $26,403, respectively. The decrease in net loss was directly attributable to a redirection of general and administrative expenses following the Reactivation Date.

Comparison of Six Months Ended March 31, 2015 and 2014

Revenues. Because we currently do not have any business operations, we have not had any revenues during the six months ended March 31, 2015 and March 31, 2014.

General and Administrative Expenses. We had operating expenses of $115,877 and $34,164 for the six months ended March 31, 2015 and March 31, 2014, respectively. These expenses consisted of general and administrative expenses which were primarily comprised of professional fees associated with various corporate and accounting matters. The increase in such expenses for the six months ended March 31, 2015 as compared to the same period ended March 31, 2014 was due to the increased level of activities taken in the quarter ended December 31, 2014 to complete the Preparatory Actions and make all of the required filings with the SEC to reactivate the Company’s suspended reporting obligations under Section 15(d) of the Exchange Act. Following the Reactivation Date our general and administrative expenses have decreased and are anticipated to remain relatively low until such time as we effect a merger or other business combination with an operating business, if at all.

Other Income. During the quarter ended December 31, 2014, we were able to obtain documentation to substantiate that certain notes payable were previously settled in full. Therefore, we recorded a gain on extinguishment of debt in the amount of $24,435 during the first quarter of the six month period ended March 31, 2015.

Net Income (Loss). We incurred net losses for the six months ended March 31, 2015 and March 31, 2014 of $91,442 and $34,164, respectively. The increase in net loss was directly attributable to an increase in general and administrative expenses in connection with the Preparatory Actions taken prior to the Reactivation Date.

Liquidity and Capital Resources

At March 31, 2015, we had a working capital deficit of $1,959,420 compared to a working capital deficit of $1,963,543 at September 30, 2014. Current liabilities decreased to $1,982,716 at March 31, 2015 from $1,986,920 at September 30, 2014 due to a decrease in accounts payable. Total assets decreased from $23,377 at September 30, 3014 to $23,296 at March 31, 2015 due to a decreased in prepaid expenses of $10,000, particularly offset by a $9,919 increase in cash.

We had no material commitments for capital expenditures as of March 31, 2015. However, if we are able to execute our business plan as anticipated in the future, we would likely incur substantial capital expenditures and require additional financing to fund such expenditures.

During six months ended March 31, 2015, we received the following financings:

•   on December 19, 2014, Mr. Toomey advanced $60,000 to the Company;

•   on March 5, 2015, Mr. Toomey advanced $20,000 to the Company; and

•   on March 16, 2015, Mr. Toomey advanced $40,000 to the Company.

These funds were used by the Company to pay for the Company’s ongoing business operations, consisting primarily of professional fees, and to pay the costs associated with certain of its the Preparatory Actions through the Reactivation Date.

The funds advanced on December 19, 2014, were acknowledged and formalized by the parties pursuant to a Convertible Promissory Note Purchase Agreement, effective as of February 10, 2015 (the “February 2015 Note Agreement”), by and between the Company and Mr. Toomey, and issuing a convertible promissory note in favor of Mr. Toomey in aggregate principal amount of $60,000 bearing interest at a fixed rate of 3.5% per annum, payable from December 19, 2014, the date of that the actual loan was provided to the Company (the “February 2015 Promissory Note”). The February 2015 Promissory Note is due upon demand, but no earlier than June 1, 2015, and is convertible into shares of our common stock Company by Mr. Toomey at a fixed conversion price equal to $0.01 per share (subject to anti-dilution adjustments).

The funds advanced in March 2015 were acknowledged and formalized by the parties pursuant to a Convertible Promissory Note Purchase Agreement, effective as of May 13, 2015 (the “May 2015 Note Agreement”), by and between the Company and Mr. Toomey. Each of the advances made in March 2015 by Mr. Toomey in the amounts of $20,000 and $40,000 are evidenced by convertible promissory notes in favor of Mr. Toomey for the principal amount thereof, bearing fixed interest rates of 3.5% per annum, payable from the date of the actual advance (the “May 2015 Promissory Notes”). The May 2015 Promissory Notes are due upon demand, but no earlier than June 1, 2015, and are convertible into shares of our common stock Company by Mr. Toomey at a fixed conversion price equal to $0.01 per share (subject to anti-dilution adjustments).

Mr. Toomey has not yet executed his conversion rights under the February 2015 Promissory Note or any of the May 2015 Promissory Notes and there is no assurance that he will exercise such rights.

Because we do not have any revenues from operations, absent a merger or other business combination with an operating company or a public or private sale of our equity or debt securities, the occurrence of either of which cannot be assured, we will continue to be dependent upon future loans or equity investments from our present shareholders or management to fund operating shortfalls and do not foresee a change in this situation in the immediate future. We will attempt to raise capital for our current operational needs through loans from related parties, debt financing, equity financing or a combination of financing options. However, there are no existing understandings, commitments or agreements for extension of outstanding notes or an infusion of capital, and there are no assurances to that effect. Further, our need for capital may change dramatically if unknown claims or debts surface or if we acquire an interest in a business opportunity. There can be no assurances that any additional financings will be available to us on satisfactory terms and conditions, if at all. Unless we can obtain additional financing, our ability to continue as a going concern is doubtful. Although Mr. Toomey has provided the necessary funds for the Company in the past, there is no existing commitment to provide additional capital and he is unlikely to fund the Company to pay for any claims made against the Company for substantial debts or other obligations. In such situation, there can be no assurance that we shall be able to receive additional financing, and if we are unable to receive sufficient additional financing upon acceptable terms, it is likely that our business would cease operations or, at the very least, cease to be a reporting Company under the Exchange Act.

Now that the Company has reactivated its suspended reporting obligations under the Exchange Act, former shareholders, officers, employees, creditors, or others may approach the Company and allege that there are outstanding claims for which the Company is responsible. In fact, the Company has been contacted by one shareholder suggesting that the Company may owe certain contractual obligations to that shareholder. However, the Company is unclear as to the nature of any such obligation and, in any event, does not believe that any obligations are owed to that shareholder. In view of the Company’s extremely limited resources, any such claims, if formally made, and/or proceedings commenced with respect thereto by such shareholder or any other third party or parties against the Company, would have a material adverse impact on the Company and may cause the Company to cease as a going concern. In such event, it is unlikely that the Company would be able to obtain any future financings from Mr. Toomey or others in order to maintain its current operations and it also would render unlikely that the Company would be able to pursue its business plan or that it will continue to be a reporting company under the Exchange Act.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a “Smaller Reporting Company”, the Company is not required to provide the information required by this Item

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedure

Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.

As of the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of our sole officer and employee of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended). Based on that evaluation, our sole officer and employee concluded that the Company’s disclosure controls and procedures were not effective as of March 31, 2015 as a result of the material weakness in internal control over financial reporting because of inadequate segregation of duties over authorization, review and recording of transactions, as well as the financial reporting of such transactions. Although financial resources are limited, management continues to evaluate opportunities to mitigate the above material weaknesses. Despite the existence of these material weaknesses, we believe the financial information presented herein is materially correct and in accordance with generally accepted accounting principles.

Changes in Internal Control over Financial Reporting

There were no significant changes in our internal controls or in other factors that could significantly affect our disclosure controls and procedures subsequent to the date of the above referenced evaluation. Furthermore, there was no change in our internal control over financial reporting or in other factors during the quarterly period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

ITEM 1. LEGAL PROCEEDINGS

There are presently no pending legal proceedings to which the Company, any of its subsidiaries, any executive officer, any owner of record or beneficially of more than five percent of any class of voting securities is a party or as to which any of its property is subject, and no such proceedings are known to the Company to be threatened or contemplated against it.

ITEM 1A. RISK FACTORS

As a “Smaller Reporting Company”, the Company is not required to provide the information required by this Item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

During the quarter ended March 31, 2015, Mr. Toomey advanced the Company $20,000 on March 5, 2015 and $40,000 on March 16, 2015 in exchange for the March 2015 Promissory Notes, bearing fixed interest rates of 3.5% per annum, payable from the date of the actual advance. Each of the March 2015 Promissory Notes is convertible into the common stock of the Company by Mr. Toomey at a fixed conversion price of $0.01 per share. These funds from the amounts advanced by Mr. Toomey during the quarter ended March 31, 2015, were used by the Company to pay for the Company’s ongoing business operations, consisting primarily of professional fees.

ITEM 3. DEFAULTS ON SECURITIES

Not Applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5. OTHER INFORMATION

Although there are no legal proceedings pending or, to the knowledge of the Company, currently threatened or contemplated against it, now that the Company has reactivated its suspended reporting obligations under the Exchange Act, former shareholders, officers, employees, creditors, or others may allege that there are outstanding claims for which the Company is responsible. In fact, the Company has been contacted by one shareholder suggesting that the Company may owe certain contractual obligations to that shareholder. However, the Company is unclear as to the nature of any such obligation and, in any event, does not believe that any obligations are owed to that shareholder. In the case any such claims are formally made or presented to the Company by any third parties, we will review and analyze such claim on a case by case basis and respond to it as we deem appropriate.

ITEM 6. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

_________

* Exhibit Filed Herewith

SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. 

INDEX TO EXHIBITS

___________

* Exhibit Filed Herewith

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