New You, Inc. - Quarter Report: 2014 May (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

  Washington, D.C. 20549

FORM 10-Q

(Mark One) 

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

For the quarterly period ended May 31, 2014

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

For the transition period from __________ to __________

COMMISSION FILE NUMBER 333-136663

THE RADIANT CREATIONS GROUP, INC. 

(Exact name of registrant as specified in its charter)

(561) 420-0380

(Registrant's telephone number, including area code)

1313 S. Killian Drive, Suite B

Lake Park, Florida 33403

(Former name, former address and former fiscal year, if changed since last report)

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 [ 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 (§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, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [ ] No [ X]

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: As of May 31, 2014, the Issuer had 54,271,336 shares of common stock issued and outstanding.

ITEM 1. FINANCIAL INFORMATION

The accompanying notes are an integral part of these unaudited consolidated financial statements  

THE RADIANT CREATIONS GROUP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS 

 (Unaudited)

The accompanying notes are an integral part of these unaudited consolidated financial statements

THE RADIANT CREATIONS GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1 – Organization and Significant Accounting Policies

Nature of Business

On June 20, 2013, following a change of control and subsequent acquisition of an exclusive license agreement, certain assets and processes to innovative technologies in skin protection and enhancement, which consist of various proprietary products including an anti-aging and revitalizing skin cream generally under the "Radiant Creations" label, the Company changed its principal business to the development and marketing of unique and proprietary scientific technologies and cosmetic and over-the-counter personal enhancement products and devices.

Basis of Presentation

The accompanying unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s most recent Annual Financial Statements filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim period presented have been reflected herein. The results of operations for the interim period are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosures contained in the audited financial statements for the most recent fiscal period, as reported in the Form 10-K, have been omitted

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its controlled subsidiaries. Intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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.

Fair Value of Financial Instruments

Pursuant to ASC 820, Fair Value Measurements and Disclosures, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The following table sets forth by level within the fair value hierarchy the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as May 31, 2014:

Recently issued accounting pronouncements

We do not expect the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.

NOTE 2 – Going Concern

The accompanying financial statements have been prepared on the basis of accounting principles applicable to a “going concern”, which assume that the Company will continue in operation for at least one year and will be able to realize its assets and discharge its liabilities in the normal course of operations.

Several conditions and events cast substantial doubt about the Company’s ability to continue as a going concern. The Company has incurred net losses since inception. Until the current year, we had no revenues and required additional financing in order to finance its business activities on an ongoing basis. The Company’s future capital requirements will depend on numerous factors including, but not limited to, executing its marketing and business plans and the pursuit of business opportunities. The Company is actively pursuing alternative financing and has had discussions with various third parties, although no firm commitments have been obtained. In the interim, shareholders of the Company have committed to meeting its operating expenses. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.

These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

NOTE 3 - Short-Term Notes

Notes payable – third parties

The Company had two notes with outstanding balances as of May 31, 2014 of $75,000 and $15,000 which are subject to annual interest of 15% and mature on November 29, 2014 and January 31, 2015, respectively. Principal payments on these notes during the three months ended May 31, 2014 amounted to $5,000.

Notes payable - related parties

As of February 28, 2014 the Company had advances from corporate officers of $15,650. The advances are non-interest bearing and have no maturity date. These advances were fully paid as of May 31, 2014.

The Company had a note payable to a related party with an outstanding balance as of May 31, 2014 of $38,250. The note is subject to annual interest of 15% and matures on August 31, 2014. Principal payments on this note during the three months ended May 31, 2014 amounted to $11,750.

Convertible notes payable

On November 19, 2013, the Company signed a convertible note agreement with Asher Enterprises (“Asher”), in which Asher loaned $78,500 subject to annual interest of 8%. The note is convertible into the Company’s common stock after 180 days from the date of issuance at 58% of the average lowest three-day price of the common stock during the ten days preceding the date of conversion. On May 18, 2014, the note became convertible and the embedded conversion option required derivative accounting owing to variable conversion rate. On May 18, 2014, a derivative liability of $64,146 was recorded as a debt discount and amortized over the term of the note. The derivative treatment on the embedded conversion option of the Asher note also tainted the outstanding convertible notes- see below and Note 4.

The Company also entered into Asher convertible note agreements on December 16, 2013 and January 27, 2014. The notes are convertible after 180 days and bear similar terms to the note above. As of May 31, 2014, these notes had not reached 180 days and do not qualify for derivative treatment.

As of May 31, 2014, the Company owed convertible notes totaling $370,000 to third parties including accrued interest of another $4,041. Interest is 10% annually and is to be paid currently. The notes may be converted at the option of the Holder at a fixed rate of $0.075 per share. As disclosed above, these notes were deemed tainted on the date that the Asher note became convertible on May 18, 2014. A derivative liability of $148,771 was recorded as a debt discount and amortized over the terms of the notes.

Amortization expense on the debt discount for the three months ended May 31, 2014 amounted to $8,230.

NOTE 4 – Long-Term Convertible Note Payable

In 2013, the Company issued a convertible note to a third party amounting to $730,448 which is subject to annual interest of 10%. The note is convertible at a fixed rate of $0.075 per share and mature on September 20, 2015. Principal payments on this note during the three months ended May 31, 2014 amounted to $27,912. As disclosed above, these notes were deemed tainted on the date that the Asher note became convertible on May 18, 2014. A derivative liability of $252,313 was recorded as a debt discount and amortized over the term of the note.

Amortization expense on the debt discount for the three months ended May 31, 2014 amounted to $6,876.

NOTE 5 – Fair Value Measurement and Derivative Liability

The Company records the fair value of the of the conversion price of the convertible notes disclosed in Notes 3 and 4 in accordance with ASC 815, Derivatives and Hedging. The fair value of the derivative liability was calculated using a multi-nominal lattice model performed by an independent qualified business valuator. The fair value of the derivative liability is revalued on each balance sheet date with corresponding gains and losses recorded in the consolidated statements of operations. During the three months ended May 31, 2014, the Company recorded a loss on the change in fair value of derivative liability of $64,040.

The following table summarizes the changes in the derivative liability during the three months ended May 31, 2014:

The fair value of the instruments was determined using multinomial lattice model based on the following assumptions:

NOTE 6 - Equity

During the three months ended May 31, 2014, the Company granted 30,550,000 options to employees with a term of 5 years and are exercisable at prices ranging from $0.098 to $0.127 per share. 10,000,000 options vested immediately while the remaining 20,550,000 options vest at a rate of 33% on the grant date, 33% one year from the grant date and the remaining 33% two years from the grant date. The fair value of the options was determined using a Black Scholes model. The total value of the options amounted to $2,934,897 of which $1,839,026 was recorded as stock compensation expense during the three months ended May 31, 2014.

During the three months ended May 31, 2014, the Company granted 300,000 warrants with a term of 5 years and an exercise price of $0.05 per share to a third party for services. 100,000 warrants vested immediately at the grant date while 100,000 will vest one year from the grant date and the remaining 100,000 warrants will vest two years from the grant date. The first tranche of the vested warrants was valued at $10,353 using the Black Scholes model and fully recognized as stock compensation expense during the three months ended May 31, 2014.

The assumptions used in the Black Scholes valuations include:

The following tables summarize the Company’s stock options and warrants activity during the three months ended May 31, 2014:

 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operation

Cautionary Statement Regarding Forward-Looking Statements

Certain statements contained in this Quarterly Report constitute "forward-looking statements." These statements, identified by words such as "plan," "anticipate," "believe," "estimate," "should," "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. These statements reflect the current views of management with respect to future events and are subject to risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from those described in the forward-looking statements. Such risks and uncertainties include those set forth under the caption "Part II - Item 1A. Risk Factors" and elsewhere in this Quarterly Report. We do not intend to update the forward-looking information to reflect actual results or changes in the factors affecting such forward-looking information. We advise you to carefully review the reports and documents, particularly our Annual Reports, Quarterly Reports and our Current Reports, we file from time to time with the Securities and Exchange Commission (the "SEC").

As used in this Quarterly Report, the terms "we," "us," "our," "Radiant," and the "Company" refer to The Radiant Creations Group, Inc. unless otherwise indicated. All dollar amounts in this Quarterly Report are expressed in U.S. dollars, unless otherwise indicated.

Introduction

Effective May 21, 2012, a change of control took place and Clarent Services Corp. acquired from Half Moon Bay Holdings, LLC, 25,000,000 shares of common stock of the Registrant, representing all of Half Moon Bay’s holdings of the Registrant.  The shares constitute in the approximately 83.33% of the thirty million (30,000,000) issued and outstanding shares of common stock of the Company. There are no arrangements or understandings among members of the former and new control groups and their associates with respect to election of directors or other matters.

Effective May 21, 2012, Mr. Duncan Bain resigned as our President, Chief Executive Officer, and Chief Financial Officer and was appointed as our Vice President. There were no disagreements between Mr. Bain and us regarding any matter relating to our operations, policies or practices. Mr. Carmen Joseph Carbona was appointed as President, Chief Executive Officer, and Chief Financial Officer in place of Mr. Bain.

Recent Corporate Developments

On June 20, 2013, a change of control of the Company occurred when Biodynamic Molecular Technologies, LLC a privately held company organized in the State of Florida acquired from Clarent Services Corp. the former majority stockholder of the Company in a private transaction 25,000,000 restricted shares of common stock, par value $0.00001 per share of the Company.

The Company is not aware of any arrangements, including any pledge of securities of the Company, the operation of which may at a subsequent date result in a change of control of the Company.

Departure of Directors or Principal Officers

On June 20, 2013, Mr. Carmen J. Carbona presented to the Board of the Company a letter of resignation whereby he resigned from his positions as President, Chief Executive Officer and Chief Financial Officer of the Company and as the sole member of the Board and all other positions to which he has been assigned, regardless of whether Mr. Carbona served in such capacity, of the Company, effective on June 20, 2013.  Mr. Carbona’s resignation was not the result of any disagreements with the Company on any matters relating to the Company’s operations, policies or practices.

Appointment of New Board Members

On June 20, 2013, the stockholders of the Company holding a majority in interest of the Company’s voting equity, approved by written consent and the members of the board of directors (the “Board”) of the Company approved by unanimous written consent, (i) the acceptance of resignation of Mr. Carnen J. Carbona from his positions as an officer and director of the Company, and (ii) the appointment of Mr. Gary R. Smith, Mr. Manpreet Singh Thaper and Mr. Gary D. Alexander to the Board of Directors.

Appointment of New Corporate Officers

On June 20, 2013 the new Board of Directors of the Company elected Mr. Gary R. Smith as its Chairman and appointed him as the Company's new Chief Executive Officer.  The Board further appointed Mr. Manpreet Singh Thaper, a member of the Board as its President and Chief Operating Officer, appointed Mr. Gary D. Alexander, a member of the Board as its Chief Financial Officer and Corporate Secretary and appointed Michael S. Alexander as its Vice President of Corporate Finance.  The Board moved the corporate offices from Marcellus, New York to 1320 South Killian Drive, in Lake Park, Florida. On December 1, 2013, the corporate offices was moved to Harbour Financial Cernter, 2401 PGA Boulevard, Suite 280-B, Palm Beach Gardens, FL 33410.

Mr. Gary R. Smith CEO of The Radiant Creations Group, Inc. is a corporate leader, manager, and consultant with extensive business experience in top management positions. He has more than three decades of operational experience as manager and CEO for leading automotive and auto finance organizations. In 2008 Mr. Smith purchased Superglass Windshield Repair franchises in the State of Florida which is still oversees. Mr. Smith joined The Renewable Corporation in March of 2012 where he serves as President and CEO.

Mr. Manpreet Singh Thaper began his career after he earned a BS in Accounting from Arizona State University, W.P. Carey School of Business. Upon his graduation from Arizona State, He worked in the mining and metals industry for several years, which is where he gained valuable experience and knowledge in the fields of public company accounting and SEC reporting.  His experiences also include holding the key position of Financial Controller in the healthcare and consumer financial world and later moving on to become the leading professional working as the CFO and Principal of Long Island Casino, Inc. Mr. Singh joined the executive team at The Renewable Corporation in May 2012 and has been a valuable member of the team until his resignation in January 2013 in anticipation of this transaction. He brings his ability to apply tenacious improvements and development of new technologies, procedures and policies to maximize on the success of Company. 

Mr. Gary D. Alexander, a founder and chairman of Technology River Investment, LLC a Florida based investment firm. He has more than 30 years of experience in the fields of accounting and investments. His knowledge and skills include initiating public and private offerings for small companies, professional accounting services with “go-public” transactions, private placement syndications, mergers, and acquisitions. He has extensive experience in forensic and reconstructive accounting and litigation matters. He has appeared with counsel in mediation and/or with a special master representing NASD broker-dealers as an auditor and consultant. He has also led and participated in projects in other fields, including the aviation industry, automotive, petroleum, internet services, telephone and VoIP industries, medical facilities, cosmetic and the entertainment, music and film industries.

Previously, Mr. Alexander was chairman of Treasure Coast Private Equity, a Florida based private equity firm that specializes in providing debt and equity resources for privately owned business seeking expansion capital. In December 2011, the Company was combined with Technology River Investments. In January 2013, he was appointed as officer and member of the board of directors of Brick Top Productions, Inc. a Florida base film production company (BTOP). On January 6, 2014 Mr. Alexander resigned from Brick Top Productions to expand on other existing opportunities.In June 2013 he became director, chief financial officer and corporate secretary of The Radiant Creations Group, Inc. a/k/a Nova Mining Corporation (NVMN). Through an asset acquisition, the company is designed to capitalize on innovative patented DNA based technologies to be used in the cosmetic and medical industries.

In December 2011, Mr. Alexander was appointed director, chief financial officer, corporate secretary and treasurer of The Renewable Corporation (RNWB), a state of Washington Corporation doing business in Florida. The company is a manufacturer and distributor of innovative and proprietary surface coatings and nano-bonding products. In November 2007, Mr. Alexander was appointed outside/independent director of FirstPlus Financial Group, Inc. (FPFX) a former member of the New York Stock Exchange, was a diversified company providing commercial loans, consumer lending, residential and commercial restoration, facility maintenance services, insurance adjusting services, construction management services and a facilities and restoration franchise business. In early 2008, following a managerial restructuring, he was appointed “acting CFO” and designated corporate officer for SEC interface. From November 2006 to April 2007, Mr. Alexander was acting chief financial officer of Air Rutter International, LLC and Airspace, LLC located in Long Beach, California.  Air Rutter and Airspace were engaged in the business of private jet charter and aircraft management. From November 2005 to March 2006, Mr. Alexander was acting chief financial officer for Jet First, Inc. located in West Palm Beach, Florida.  Jet First was a private jet charter company.

In December 1977, Mr. Alexander earned a Bachelor of Business Administration (Accounting) degree from Florida Atlantic University, Boca Raton, FL. He owned and operated a successful CPA practice from April 1982 through December 2006. Throughout his career, he has served as a member and chair of numerous charitable organizations to help provide needed services in his local community.

Mr. Michael S. Alexander, Vice President of Corporate Finance of The Radiant Creations Group, began his career as Manager of Treasure Coast Private Equity, with a focus on technology and the development of start-up companies with patented or prototype products. He participated in equity market trading, including small cap, micro cap and options, and assisted with the acquisition and advancement of existing technologies. During his time there he was invited to become a Board Member for Greenwood Gold Mining, a small public company.  In December, 2011, Mr. Alexander became the CEO and President of Technology River Investments the predecessor to Treasure Coast Private Equity where Mr. Alexander was incremental in the acquisition and management of numerous portfolio investments on behalf of Technology River. Currently, Mr. Alexander serves as the VP of Corporate Finance at The Renewable Corporation (RNWB).  Mr. Alexander is a graduate of the University of North Florida, and holds a Bachelor of Science degree in Business Administration (Finance). He has been an active volunteer with a number of local philanthropic organizations, including The United Way of Martin County in Stuart, Florida.

Involvement in Certain Legal Proceedings

During the past five years no director or executive officer of the company (i) has been involved as a general partner or executive officer of any business which has filed a bankruptcy petition; (ii) has been convicted in any criminal proceeding nor is subject to any pending criminal proceeding; (iii) has been subjected to any order, judgment or decree of any court permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and (iv) has been found by a court, the Commission or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law.

Family Relationships

Mr. Gary R. Smith directly owns fifty percent, Mr. Gary D. Alexander owns twenty five percent, Mr. Michael S. Alexander owns twenty five percent and Mr. Manpreet Singh Thaper has no direct or indirect financial interest in Biodynamic Molecular Technologies, LLC, the majority shareholder of the Company.

Entry into a Material Definitive Agreement

On July 10, 2013 the Original Agreement was amended to whereby the purchase price was reduced to One Million Thirty Thousand ($1,030,000) US Dollars payable with 7,545,788 newly issued shares of the Company based on the seven (7) day average closing price of Sellers’s common shares from Monday the 17th day of June to Tuesday the 25th day of June, 2013 with a thirty five (35%) percent discount.

The license purchased is with Dr. Yin-Xiong Li, MD, Ph.D. to his patent in Enhanced Broad-Spectrum UV Radiation Filters and Methods as disclosed and claimed in U.S. Patent No. US Patent # 6,117,846 - Nucleic acid filters and US Patent Application # 20080233626 - Enhanced broad-spectrum UV radiation filters and methods, and the following international filings European Application # 07811023.6, and Australian Application # 2007281485 and as trade secrets associate with the above listed intellectual property and trade secrets and potential patent applications for an anti-aging skin rejuvenation cream, an acne OTC treatment, a wrinkle reduction cream, BioSalt redistribution technology using supplements.  The License Agreement, as of June 25, 2013 has added an addendum to it allowing Renewable to transfer the license agreement to The Radiant Creations Group.

The various patented skin products acquired include all the patented technologies that strips out the four nucleotide code molecules from DNA strands and uses them in a system that can provide up to 99% protection from DNA damage, which is the cause of aging and skin cancer. A second technology is the delivery system to house the nucleotides, and also, a hydration agent that is time released to infuse uniform hydration into the skin for up to 10 hours.  The resulting products are a DNA based SPF-30 day cream; an anti-aging and rejuvenating night cream featuring the hydration system, Chinese herbs, and aloe; a medical radiation protection and healing cream for use by dermatologists in radiation therapy for skin cancer and a rejuvenating DNA protection cream for the tanning bed industry for DNA damage protection.

Amendment to Articles of Incorporation

On July 16, 2013, the Company changed its name officially to The Radiant Creations Group, Inc. by filing a Certificate of Amendment to its Articles of Incorporation, pursuant to Nevada Revised Statutes 78.385 and 78.390 with the office of the Secretary of State for the State of Nevada.

Other Regulatory Disclosure (FINRA)

On July 24, 2013, the Company received confirmation from FINRA that effective at the opening of business on Friday, July 26, 2013, we will be trading as The Radiant Creations Group, Inc. under the symbol OTCBB: RCGP.

Concurrently with the change of our President, we moved our principal executive offices to:

1313 South Killian Drive, Suite B

Lake Park, FL 33403

Subsequently, we moved our principal executive offices to:

Harbour Executive Center

2401 PGA Boulevard, Suite 280-B

Palm Beach Gardens, FL 33410

Our new telephone number is: (561) 420-0380

This location is the office of our new President, Mr. Gary R. Smith.

Plan of Operation

On June 20, 2013, following a change of control and subsequent acquisition of an exclusive license agreement, certain assets and processes to innovative technologies in skin protection and enhancement, which consist of various proprietary products including an anti-aging and revitalizing skin cream generally under the "Radiant Creations" label, the Company changed its principal business to the development and marketing of unique and proprietary scientific technologies and cosmetic and over-the-counter personal enhancement products and devices. 

As of May 31, 2014, we had cash assets of $40,161 and a working capital deficit of $(770,541) and an accumulated deficit of $(6,718,020). As such, we anticipate that we will require substantial financing in the near future in order to meet our current obligations and to continue our operations. In addition, in the event that we are successful in identifying suitable alternative business opportunities, of which there is no assurance, we anticipate that we will need to obtain additional financing in order to pursue those opportunities.

Currently, we do not have any financing arrangements in place and there are no assurances that we will be able to obtain sufficient financing on terms acceptable to us, if at all. Due to the lack of our operating history and our present inability to generate significant revenues, our auditors have stated in their audit report included in our audited financial statements for the year ended February 28, 2014 that there currently exists substantial doubt about our ability to continue as a going concern.

Off-Balance Sheet Arrangements

None.

Financing Requirements

From December 29, 2005 (Inception) to May 31, 2014, we have suffered cumulative losses of $(6,718,020). We expect to continue to incur substantial losses as we continue the growth of our business. Since our inception, we have funded operations through common stock issuances, related party loans, and the support of creditors in order to meet our strategic objectives.

Our management believes that sufficient funding will be available to meet our business objectives, including anticipated cash needs for working capital, and are currently evaluating several financing options, including a public offering of securities. However, we do not have any financing arrangements currently in place and there can be no assurance that we will be able to obtain sufficient financing when needed. As a result of the foregoing, our independent auditors believe there exists substantial doubt about our ability to continue as a going concern.

There is no assurance that we will be able to obtain additional financing if and when required. We anticipate that additional financing may come in the form of sales of additional shares of our common stock which may result in dilution to our current shareholders.

Going Concern Qualification

Several conditions and events cast substantial doubt about the Company’s ability to continue as a going concern.  The Company has incurred net losses of $(6,718,020) for the period from December 29, 2005 to May 31, 2014; we have revenues of $1,214,763 (from August 26 through May 31, 2014) and requires additional financing in order to finance its business activities on an ongoing basis.  The Company’s future capital requirements will depend on numerous factors including, but not limited to, executing the company’s marketing and business plans and the pursuit of other business opportunities. The Company is actively pursuing alternative financing and has had discussions with various third parties, although no firm commitments have been obtained.  In the interim, shareholders of the Company have committed to meeting its operating expenses.  Management believes that actions presently being taken to revise the Company’s operating and financial requirements provide them with the opportunity to continue as a going concern. 

At May 31, 2014, we had $40,161 in cash assets, $1,521,655 in liabilities, and an accumulated deficit of $(6,718,020).  See “Liquidity and Capital Resources.”

Liquidity and Capital Resources

It is the intent of our management, stockholders, and specifically the majority Shareholder, BioDynamic Molecular Technologies, LLC and our Chief Executive Officer, Gary R. Smith, our Chief Financial Officer, Gary D. Alexander and Our Chief Operating Officer, Manpreet Singh Thaper to provide sufficient working capital necessary to support and preserve the integrity of our Company as a corporate entity.  However, there is no legal obligation for either the majority Shareholder(s) or Officer(s) to provide additional future funding. If our management ceases to provide us the needed financing and we fail to identify any alternative sources of funding, there will be substantial doubt about our ability to continue as a “going concern”.

We have no current plans, proposals, arrangements or understandings with respect to the sale or issuance of additional securities.  As a result, there can be no assurance that sufficient funds will be available to us to enable us to pay the expenses related to such activities.

Regardless of whether or not our cash assets prove to be adequate to meet our operational needs, we may have to compensate providers of services by issuances of our common stock in lieu of cash.

At May 31, 2014, we had $40,161 in cash, $1,521,655 in liabilities, and an accumulated deficit of $(6,718,020). Our primary source of liquidity has been from loans from a majority shareholder(s) and loans from outside parties.  As of May 31, 2014, the Company owed $1,515,729 in notes and accrued interest.

Net cash used in operating activities was $(18,635) during the quarter ended May 31, 2014.  

Cash used in investing activities was $(1,767) during the quarter ended May 31, 2014.

Cash used in financing activities was $(60,312) during the quarter ended May 31, 2014.  

Our expenses to date are largely due to professional fees that include accounting and legal fees.

To date, we have revenues of $1,214,763 (from August 26 through May 31, 2014) and require additional financing in order to finance our business activities on an ongoing basis.  Our future capital requirements will depend on numerous factors, including, but not limited to, executing our marketing and business plans and the ability to pursue other business opportunities. We are actively pursuing alternative financing and have had discussions with various third parties, although no firm commitments have been obtained to date.  In the interim, shareholders of the Company have agreed to meet our operating expenses.  We believe that actions presently being taken to revise our operating and financial requirements provide the Company with the opportunity to continue as a “going concern,” although no assurances can be given.

Net Loss from Operations

The Company had a net loss of $(6,718,020) for the period from inception through May 31, 2014. The Company had a net loss of $(1,897,131) for the three months ended May 31, 2014 as compared to a net loss of $(35,795) for the three months ended May 31, 2013.

Cash Flow

Our primary source of liquidity has been cash from shareholder loans, loans from outside parties and advances.

Working Capital

As of May 31, 2014, the Company had total current assets of $294,015 and total current liabilities of $1,064,556 resulting in a working capital deficit of $(770,541). As of February 28, 2014, the Company had total current assets of $317,213 and total current liabilities of $765,336, resulting in a working capital deficit of $(448,123).

Lack of Revenues

We have had limited operations since our inception on December 29, 2005 to May 31, 2014.  We have generated revenues of $1,214,763 beginning on August 26, 2013.  As of May 31, 2014, we have an accumulated deficit of $6,718,020. Our financial statements contain an additional explanatory paragraph in Note 1, which identifies issues that raise substantial doubt about our ability to continue as a going concern.  Our financial statements do not include any adjustment that might result from the outcome of this uncertainty.

Net Loss

We incurred a net loss of $1,897,131 for the three months ended May 31, 2014, compared to a net loss of $35,795 for the three months ended May 31, 2013.  From inception on December 29, 2005 to May 31, 2014, we have incurred a net loss of $6,718,020.  Our basic and diluted loss per share was $(0.03) for the three months ended May 31, 2014, and $(0.00) for the three months ended May 31, 2013. 

Operating and Administration Expenses

Operating expenses increased by $2,311,552 from $7,817 in the three months ended May 31, 2013, to $2,319,369 in the three months ended May 31, 2014.  Operating expenses for the three months comparison primarily consist of office administration, professional and regulatory compliance, investor relations and marketing and advertising.

Other Expenses 

Other expenses increased by $86,319 from $27,978 in the three months ended May 31, 2013, to $114,297 in the three months ended May 31, 2014.  Other expenses for the three months comparison primarily consist of interest expense, depreciation and derivative related costs.

Common and Preferred Stock

We are authorized by our Amended and Restated Articles of Incorporation and our Additional Articles of Incorporation to issue an aggregate of 200,000,000 shares of capital stock, of which 100,000,000 are shares of common stock, par value $0.00001 per share (the “Common Stock”) and 100,000,000 are shares of preferred stock (the “Preferred Stock”), par value $0.00001 per share.  As of May 31, 2014, 54,271,336 shares of Common Stock were issued and outstanding and there were 77 shareholders of our Common Stock and 0 shares of Preferred Stock were issued and outstanding.

On October 27, 2011 the Company declared a stock dividend of five common shares for each common share on record. The total number of shares to be distributed is 24,000,000. Since the total number of shares to be issued exceed 25% of the common shares outstanding, the transaction is recorded as a stock split and offset to additional paid in capital at par value and the effect of the issuance is applied retroactively to all periods presented.

All outstanding shares of Common Stock are of the same class and have equal rights and attributes. The holders of Common Stock are entitled to one vote per share on all matters submitted to a vote of stockholders of the Company. All stockholders are entitled to share equally in dividends, if any, as may be declared from time to time by our Board of Directors out of funds legally available. In the event of liquidation, the holders of our Common Stock are entitled to share ratably in all assets remaining after payment of all liabilities. The stockholders do not have cumulative or preemptive rights. We have not paid any dividends to date, and have no plans to do so in the near future.

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

Not Applicable.

ITEM 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

For purposes of this Item 4., the term disclosure controls and procedures means controls and other procedures of the Company (i) that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act of 1934, as amended (15 U.S.C. 78a  et seq. and hereinafter the “Exchange Act”) is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the Securities and Exchange Commission (the “Commission”), and (ii)  include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our disclosure controls and procedures do not comply with the requirements in (i) and (ii) above and is not effective.  

On May 31, 2014, our President, Gary R. Smith, has reviewed the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) as of the end of the period covered by the report and has concluded that (i) the Company’s disclosure controls and procedures are not effective to ensure that material information relating to the Company is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the Commission, and (ii) the Company’s controls and procedures have not been designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.  

The material weakness identified relates to the lack of proper segregation of duties. The Company believes that the lack of proper segregation of duties is due to the Company’s limited resources.

Changes in Internal Controls over Financial Reporting

There were no changes in our internal control over financial reporting identified in connection with our evaluation of these controls as of the first fiscal quarter ended May 31, 2014 as covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

The Company's management does not expect that its disclosure controls or its internal control over financial reporting will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system's objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

ITEM 1. Legal Proceedings

None.

PART II - OTHER INFORMATION

ITEM 1A. Risk Factors

The following are some of the important factors that could affect our financial performance or could cause actual results to differ materially from estimates contained in our forward-looking statements. We may encounter risks in addition to those described below. Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial, may also impair or adversely affect our business, financial condition or results of operation.

WE HAVE LIMITED BUSINESS OPERATIONS AND ONE PRODUCT AVAILABLE FOR SALE. WE HAVE NOT IDENTIFIED ANY ALTERNATIVE BUSINESS OPPORTUNITIES. OUR PLAN OF OPERATION FOR THE NEXT TWELVE MONTHS WILL CONSIST OF EXECUTING OUR MARKETING AND BUSINESS PLANS AND RESEARCHING NEW OPPORTUNITIES.

Our assets consists of an exclusive license purchased from Dr. Yin-Xiong Li, MD, Ph.D. to his patent in Enhanced Broad-Spectrum UV Radiation Filters and Methods as disclosed and claimed in U.S. Patent No. US Patent # 6,117,846 - Nucleic acid filters and US Patent Application # 20080233626 - Enhanced broad-spectrum UV radiation filters and methods, and the following international filings European Application # 07811023.6, and Australian Application # 2007281485 and as trade secrets associate with the above listed intellectual property and trade secrets and potential patent applications for an anti-aging skin rejuvenation cream, an acne OTC treatment, a wrinkle reduction cream, BioSalt redistribution technology using supplements.  The License Agreement, as of June 25, 2013 has added an addendum to it allowing Renewable to transfer the license agreement to The Radiant Creations Group.

In the event the Company is unable to maintain compliance with the terms of the exclusive license agreement the grantor could elect to limit or terminate the agreement which would have a material impact on our financial condition.

We May Not be Able to Obtain Additional Financing

As of February 28, 2014, we had cash on hand of $120,875 and a working capital deficit of $(448,123).

As of May 31, 2014, we had cash on hand of $40,161 and a working capital deficit of $(770,541).

Currently, our ability to obtain additional financing may be substantially limited. If sufficient financing is not available or obtainable as and when needed, we may not be able to continue as a going concern and investors may lose a substantial portion or all of their investment. We currently do not have any financing arrangements in place and there are no assurances that we will be able to acquire financing on acceptable terms or at all.

We Have Limited Officers and Directors

Because management consists of only three persons, Gary R. Smith, President and CEO, Gary D. Alexander, CFO and Corporate Secretary and Manpreet Singh Thaper, COO will be the only individuals responsible in conducting the day-to-day operations of the Company.  We do not benefit from having access to multiple judgments that a greater number of directors or officers would provide, and we will rely completely on the judgment of our three officers when selecting a target products to market.  Mr. Smith, Mr. Alexander and Mr. Singh Thaper anticipate devoting only a limited amount of time per month to the business of the Company.  Mr. Smith, Mr. Alexander and Mr. Singh Thaper all anticipate executing written employment agreements with the Company in the near future, however we do not anticipate obtaining key man life insurance on  Mr. Smith, Mr. Alexander or Mr. Singh Thaper. The loss of the services of  Mr. Smith, Mr. Alexander or Mr. Singh Thaper would adversely affect development of our business and our likelihood of continuing operations.

We Depend on Management and Management's Participation is Limited

We will be entirely dependent upon the experience of our officers and directors in seeking, investigating, and acquiring new business opportunities and in making decisions regarding our operations.  It is possible that, from time to time, the inability of such persons to devote their full time attention to the Company will cause the Company to lose an opportunity.

We May Conduct Further Offerings in the Future in Which Case Investors' Shareholdings' will be Diluted

We may conduct equity offerings in the future to finance any future business projects that we decide to undertake. If common stock is issued in return for additional funds, the price per share could be lower than that paid by our current stockholders. We anticipate continuing to rely on equity sales of our common stock in order to fund our business operations. If we issue additional stock, investors' percentage interest in us will be diluted. The result of this could reduce the value of their stock.

Because Our Stock is a Penny Stock, Shareholder will be More Limited in Their Ability to Sell Their Stock

The shares of our common stock constitute "penny stocks" under the Exchange Act. The shares will remain classified as a penny stock for the foreseeable future. The classification as a penny stock makes it more difficult for a broker/dealer to sell the stock into a secondary market, which makes it more difficult for a purchaser to liquidate his or her investment. Any broker/dealer engaged by the purchaser for the purpose of selling his or her shares will be subject to rules 15g-1 through 15g-10 of the Exchange Act. Rather than having to comply with these rules, some broker-dealers will refuse to attempt to sell a penny stock.

The "penny stock" rules adopted by the SEC under the Exchange Act subjects the sale of the shares of our common stock to certain regulations which impose sales practice requirements on broker/dealers. For example, brokers/dealers selling such securities must, prior to effecting the transaction, provide their customers with a document that discloses the risks of investing in such securities.

Legal remedies, which may be available to an investor in "penny stocks," are as follows:

(a) if "penny stock" is sold to an investor in violation of his or her rights listed above, or other federal or states securities laws, the investor may be able to cancel his or her purchase and get his or her money back.

(b) if the stocks are sold in a fraudulent manner, the investor may be able to sue the persons and firms that caused the fraud for damages.

(c) if the investor has signed an arbitration agreement, however, he or she may have to pursue his or her claim through arbitration.

If the person purchasing the securities is someone other than an accredited investor or an established customer of the broker/dealer, the broker/dealer must also approve the potential customer's account by obtaining information concerning the customer's financial situation, investment experience and investment objectives. The broker/dealer must also make a determination whether the transaction is suitable for the customer and whether the customer has sufficient knowledge and experience in financial matters to be reasonably expected to be capable of evaluating the risk of transactions in such securities. Accordingly, the SEC's rules may limit the number of potential purchasers of the shares of our common stock.

ITEM 2. Unregistered Sale of Equity Securities and Use of Proceeds

None.

ITEM 3. Defaults on Senior Securities

None.

ITEM 4. Mining Safety Disclosure

Not Applicable.

ITEM 5. Other Information

None.

ITEM 6. Exhibits

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

THE RADIANT CREATIONS GROUP, INC.