Silo Pharma, Inc. - Quarter Report: 2013 September (Form 10-Q)

f10q0913_pointcapital.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarter ended September 30, 2013

o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to _____

Commission File Number: 333-173163

POINT CAPITAL, INC.

(Exact name of small business issuer as specified in its charter)

	Delaware		27-3046338
	(State of incorporation)		(IRS Employer ID Number)

285 Grand Avenue

Building 5

Englewood, New Jersey 07631

(Address of principal executive offices)

(201) 408-5126

(Issuer's telephone number)

________________________________________________________________

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

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or 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 o

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 registration was required to submit and post such files). Yes o No x

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

Large accelerated filer o		Accelerated filer o
Non-accelerated filer o		Smaller reporting company o

(Do not check if a smaller reporting company)

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

As of November 14, 2013, 37,731,200 shares of common stock, par value $0.0001 per share, were outstanding.

TABLE OF CONTENTS

	Page
PART I
Item 1. Financial Statements
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3 Quantitative and Qualitative Disclosures About Market Risk	16
Item 4 Controls and Procedures	16

PART II
Item 1. Legal Proceedings	16
Item 1A. Risk Factors	16
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	16
Item 3. Defaults Upon Senior Securities	17
Item 4. Mine Safety Disclosures	17
Item 5. Other Information	17
Item 6. Exhibits	17

PART I

FINANCIAL INFORMATION

Item 1. Financial Statements.

Point Capital, Inc.

(A Development Stage Company)

Financial Statements

September 30, 2013

(Unaudited)

CONTENTS

	Page(s)

Balance Sheets –
September 30, 2013 (unaudited) and December 31, 2012	1

Statements of Operations –
Three and nine months ended September 30, 2013 and 2012, and from
July 13, 2010 (Inception) to September 30, 2013 (unaudited)	2

Statement of Stockholders’ Equity (Deficit) –
Nine months ended September 30, 2013 (unaudited) and from
July 13, 2010 (Inception) to September 30, 2013	3

Statements of Cash Flows –
Nine months ended September 30, 2013 and 2012, from
July 13, 2010 (Inception) to September 30, 2013 (unaudited)	4

Notes to Financial Statements (unaudited)	5 - 12

Point Capital, Inc.

(A Development Stage Company)

Balance Sheets

	September 30, 2013			December 31, 2012
	(Unaudited)
Assets

Current Assets
Cash	$	1,259,100		$	279
Total Current Assets		1,259,100			279

Total Assets	$	1,259,100		$	279

Liabilities and Stockholders' Equity (Deficit)

Current Liabilities
Accounts payable and accrued expenses	$	9,950		$	20,691
Accrued offering costs		10,000			-
Notes payable		20,000			5,000
Interest payable		1,642			-
Common stock payable		673,886			-
Total Current Liabilities		715,478			25,691

Long Term Liabilities
Notes payable		-			15,000
Interest payable		-			782
Total Long Term Liabilities		-			15,782

Total Liabilities		715,478			41,473

Stockholders' Equity (Deficit)
Series A, Convertible Preferred stock, $0.0001 par value, 5,000,000 shares authorized; 4,000 and none issued and outstanding		-			-
Common stock, $0.0001 par value, 100,000,000 shares authorized; 36,231,200 and 30,631,200 shares issued and outstanding		3,623			3,063
Additional paid-in capital		1,858,856			1,123,497
Deficit accumulated during the development stage		(1,218,857	)		(1,167,754	)
Subscription receivable		(100,000	)		-
Total Stockholders' Equity (Deficit)		543,622			(41,194	)

Total Liabilities and Stockholders' Equity (Deficit)	$	1,259,100		$	279

See accompanying notes to financial statements

Point Capital, Inc.

(A Development Stage Company)

Statements of Operations

(Unaudited)

													July 13, 2010
	Three Months ended September 30,						Nine Months ended September 30,						(Inception) to September 30,
	2013			2012			2013			2012			2013

General and administrative expenses	$	5,744		$	8,550		$	51,103		$	27,257		$	1,218,857

Net loss	$	(5,744	)	$	(8,550	)	$	(51,103	)	$	(27,257	)	$	(1,218,857	)

Net loss per common share - basic and diluted	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.04	)

Weighted average number of common shares outstanding during the period - basic and diluted		30,731,200			30,631,200			30,699,332			30,631,200			30,505,209

See accompanying notes to financial statements

Point Capital, Inc.

(A Development Stage Company)

Statement of Stockholders' Equity (Deficit)

Nine months ended September 30, 2013 (unaudited) and From July 13, 2010 (Inception) to September 30, 2013

												Deficit
	Series A, Convertible											Accumulated
	Preferred Stock, $0.0001 Par Value				Common Stock, $0.0001 Par Value				Additional Paid In			Development during			Subscription			Total Stockholder's
	Shares		Amount		Shares		Amount		Capital			Stage			Receivable			Equity (Deficit)

Stock issued for services - related parties ($0.05/share)		-	$	-		21,500,000	$	2,150	$	1,072,850		$	-		$	-		$	1,075,000

Stock issued for cash ($0.005 - $0.05/share)		-		-		9,131,200		913		50,647			-			(575	)		50,985

Net loss - from July 13, 2010 (inception) to December 31, 2010		-		-		-		-		-			(1,078,505	)		-			(1,078,505	)

Balance - December 31, 2010		-		-		30,631,200		3,063		1,123,497			(1,078,505	)		(575	)		47,480

Receipt of subscription receivable		-		-		-		-		-			-			575			575

Net loss - year ended December 31, 2011		-		-		-		-		-			(49,803	)		-			(49,803	)

Balance - December 31, 2011		-		-		30,631,200		3,063		1,123,497			(1,128,308	)		-			(1,748	)

Net loss - year ended December 31, 2012		-		-		-		-		-			(39,446	)		-			(39,446	)

Balance - December 31, 2012		-		-		30,631,200		3,063		1,123,497			(1,167,754	)		-			(41,194	)

Preferred stock issued for cash ($100/Share)		4,000		-						400,000			-			-			400,000

Common stock issued for cash ($0.20/share)		-		-		5,600,000		560		1,119,440			-			(100,000	)		1,020,000

Direct offering costs - cash		-		-		-		-		(110,195	)		-			-			(110,195	)

Direct offering costs - stock		-		-		-		-		(673,886	)		-			-			(673,886	)

Net loss - for nine months ended September 30, 2013		-		-		-		-		-			(51,103	)		-			(51,103	)

Balance - September 30, 2013 (unaudited)		4,000	$	-		36,231,200	$	3,623	$	1,858,856		$	(1,218,857	)	$	(100,000	)	$	543,622

See accompanying notes to financial statements

Point Capital, Inc.

(A Development Stage Company)

Statements of Cash Flows

(Unaudited)

	Nine Months Ended September 30,						July 13, 2010 (Inception) to September 30,
CASH FLOWS FROM OPERATING ACTIVITIES:	2013			2012			2013
Net loss	$	(51,103	)	$	(27,257	)	$	(1,218,857	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock issued for services - related parties		-			-			1,075,000
Increase (decrease) in accounts payable and accrued expenses		(9,881	)		10,784			11,592
Net Cash Used In Operating Activities		(60,984	)		(16,473	)		(132,265	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes payable		-			15,000			20,000
Proceeds from issuance of Series A, Convertible Preferred Stock		400,000			-			400,000
Proceeds from issuance of common stock		1,020,000			-			1,071,560
Payment of direct offering costs		(100,195	)		-			(100,195	)
Net Cash Provided By Financing Activities		1,319,805			15,000			1,391,365

Net Increase (Decrease) in Cash		1,258,821			(1,473	)		1,259,100

Cash - Beginning of Period		279			1,752			-

Cash - End of Period	$	1,259,100		$	279		$	1,259,100

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Payment of taxes	$	-		$	-		$	-
Payment of interest	$	-		$	-		$	-

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Payment of direct offering costs - common stock	$	(673,886	)	$	-		$	(673,886	)
Subscriptions receivable	$	(100,000	)	$	-		$	(100,000	)
Accrued direct offering costs (to be paid in cash)	$	(10,000	)	$	-		$	(10,000	)

See accompanying notes to financial statements

Point Capital, Inc.

(A Development Stage Company)

Notes to Financial Statements

September 30, 2013

(Unaudited)

Note 1 Nature of Operations

Nature of Operations

Gold Swap Inc. (the “Company”), was incorporated in the State of New York on July 13, 2010.

The Company intended to purchase precious metals and second-hand jewelry for refining and resale. The Company was unable to execute its intended business plan.

On January 24, 2013, the merger of Point Capital, Inc., an inactive Delaware corporation, with Gold Swap, Inc., a New York corporation, became effective. As a result, (a) Gold Swap’s state of incorporation changed from New York to Delaware and (b) the name of the company changed from “Gold Swap Inc.” to “Point Capital, Inc.”

Change in Business

On October 4, 2013, the Company filed a Form N-54A and elected to become a Business Development Company (“BDC”) subject to the Investment Company Act of 1940.

Note 2 Basis of Presentation

The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the United States Securities and Exchange Commission for interim financial information.

The financial information as of December 31, 2012 is derived from the audited financial statements presented in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. The unaudited interim financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K, which contains the audited financial statements and notes thereto, together with the Plan of Operations for the period from July 13, 2010 (Inception) to December 31, 2012.

Certain information or footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, or cash flows. It is management's opinion, however, that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement presentation. The interim results for the nine months ended September 30, 2013 are not necessarily indicative of results for the full fiscal year.

Point Capital, Inc.

(A Development Stage Company)

Notes to Financial Statements

September 30, 2013

(Unaudited)

Note 3 Summary of Significant Accounting Policies

Development Stage

The Company's unaudited interim financial statements are presented as those of a development stage enterprise. Activities during the development stage primarily include equity based financing and further implementation of the business plan. The Company has not generated any revenues since inception. On October 4, 2013, in connection with becoming a BDC, the Company entered a new development stage.

Risks and Uncertainties

The Company's operations will be subject to significant risk and uncertainties including financial, operational, technological, regulatory and other risks associated with a development stage company, including the potential risk of business failure. Also, see Note 4 regarding liquidity.

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 periods.

The most significant estimates were as follows:

●	estimated fair value of share based payments; and
●	estimated 100% valuation allowance for deferred tax assets, due to continuing and expected future losses

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from estimates.

Cash

The Company considers all highly liquid instruments purchased with a maturity of three months or less and money market accounts to be cash equivalents. The Company had no cash equivalents at September 30, 2013 and December 31, 2012, respectively.

On September 30, 2013, the cash balance exceeded the federally insured limit by $1,009,100.

Point Capital, Inc.

(A Development Stage Company)

Notes to Financial Statements

September 30, 2013

(Unaudited)

Derivative Liabilities and Beneficial Conversion Feature

The Company evaluates its convertible debt, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with Paragraph 815-10-05-4 of the Codification and Paragraph 815-40-25 of the Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the consolidated statements of operations as other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity.

In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument.

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected within 12 months of the balance sheet date.

Share Based Payments

Generally, all forms of share-based payments, including stock option grants, warrants and restricted stock grants are measured at their fair value on the awards’ grant date, and based on the estimated number of awards that are ultimately expected to vest. Share-based payment awards issued to non-employees for services rendered are recorded at either the fair value of the services rendered or the fair value of the share-based payment, whichever is more readily determinable. The expense resulting from share-based payments are recorded as a component of general and administrative expense.

Earnings per Share

In accordance with accounting guidance now codified as FASB ASC Topic 260, “Earnings per Share,” basic earnings (loss) per share is computed by dividing net income (loss) by weighted average number of shares of common stock outstanding during each period. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period.

Point Capital, Inc.

(A Development Stage Company)

Notes to Financial Statements

September 30, 2013

(Unaudited)

The Company currently has 4,000 shares of Series A, convertible preferred stock issued and outstanding, which is convertible into 2,000,000 shares (computed by taking the stated value per share of $100 and dividing by $0.20/share, then multiplying by the number of Series A, convertible preferred shares issued) of common stock. See Note 7 for Conversion Terms.

Since the Company reflected a net loss, the effect of considering any common stock equivalents, if outstanding, would have been anti-dilutive. A separate computation of diluted earnings (loss) per share is not presented.

Recent Accounting Pronouncements

There are no recent accounting pronouncements that are expected to have an effect on the Company’s financial statements.

Note 4 Liquidity

As reflected in the accompanying unaudited interim financial statements, the Company has a net loss of $51,103 and net cash used in operations of $60,984 for the nine months ended September 30, 2013. The Company had working capital of $543,622 and stockholders’ equity of $543,622 at September 30, 2013. The Company is in the development stage and has not generated any revenues since inception.

Cash obtained through all financing activities for the nine months ended September 30, 2013 was $1,319,805, net of direct offering costs. See Note 7.

The Company believes its existing available cash will enable the Company to meet the working capital requirements for at least 12 months. The estimated working capital requirement for the next 12 months is $95,000. The Company intends to commence operations as a BDC while trying to lower costs.

Note 5 Fair Value

Fair value is the price that would be received from m selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact business and considers assumptions that marketplace participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

Point Capital, Inc.

(A Development Stage Company)

Notes to Financial Statements

September 30, 2013

(Unaudited)

The guidance also establishes a fair value hierarchy for measurements of fair value as follows:

●	Level 1 – quoted market prices in active markets for identical assets or liabilities.

●	Level 2 - inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

●	Level 3 – unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company's financial instruments consisted primarily of accounts payable, accrued expenses and notes payable. The carrying amounts of the Company’s financial instruments generally approximate their fair value due to the relatively short period to maturity for these instruments.

Note 6 Notes Payable

During February 2012, the Company executed notes payable for $15,000. The notes bear interest at 6%, default interest at 12% and are unsecured. The notes were amended in April 2012 to provide that all the notes are due and payable February 2014. These notes are classified as current liabilities.

During December 2012, the Company executed notes payable for $5,000. The notes bear interest at 5% and are unsecured. The notes are due and payable December 2013. These notes are classified as current liabilities.

Note 7 Stockholders’ Equity (Deficit) and Common Stock Payable

From July 13, 2010 (Inception) to December 31, 2010, the Company issued the following shares:

Type	Quantity		Valuation		Value per share
Cash		9,131,200	$	51,560	$	0.005 - $0.05
Services - related parties		21,500,000		1,075,000	$	0.05
Total		30,631,200	$	1,126,560

In connection with stock issued for services, the Company determined fair value based upon recent cash offerings with third parties at that time, which was the most readily available evidence.

Point Capital, Inc.

(A Development Stage Company)

Notes to Financial Statements

September 30, 2013

(Unaudited)

From January 1, 2013 to September, 2013, the Company issued the following shares:

Cash - Series A, Convertible Preferred	4,000	$	400,000	$	100.00
Cash - Common Stock	5,600,000	$	1,120,000	$	0.20
Total	5,604,000		1,520,000

The Company had paid direct offering costs to a third party placement agent associated with capital raising activities with gross proceeds of $1,100,000 for the nine months ended September 30, 2013 as follows:

Direct Offering Costs	September 30, 2013
Amount paid in cash	$	100,195
Accrued offering costs (1)		10,000
Amounts paid in shares (1)		673,886
	$	784,081

(1)

The placement agent associated with capital raising activities of the $1,100,000 in gross proceeds is entitled to a maximum of 6,126,240 shares of the Company’s common stock. The placement agent was engaged to assist with a financing of up to $2,000,000.

During the nine months ended September 30, 2013, the placement agent raised $1,100,000 (or 55% of the maximum offering), and therefore was entitled to receive 3,369,432 shares of the company’s common stock at September 30, 2013. These shares had a fair value of $673,886, based upon the recent third party cash offering price of $0.20/share, which represented the best evidence of fair value.

These shares are included in common stock payable at September 30, 2013 since the shares while due, are not required to be issued until a final closing occurs. Of the 5,500,000 shares issued for $1,100,000, 500,000 shares having a fair value of $100,000 ($0.20/share) was a subscription receivable as of September 30, 2013. The subscription was collected in October 2013.

In connection with the subscription receivable for $100,000, the Company accrued $10,000 in direct offering costs, which were paid in October 2013.

Amounts paid in cash to the placement agent are based upon a 7% fixed amount related to gross proceeds raised. The placement agent is also entitled to receive an additional amount up to 3% in a non-accountable expense allowance.

See Note 8.

Series A, Convertible Preferred Stock

The Company has determined that the embedded conversion option is clearly and closely related to the host instrument. Therefore, no derivative liability exists.

Based on the previous sale price of the Series A, preferred stock to a third party, the fair value of the stock is $0.20/share, which represents the best evidence of fair value. The conversion price of the Series A, Convertible Preferred is $0.20/share. Since the market price and exercise price are equivalent, no additional accounting for a BCF is required.

Point Capital, Inc.

(A Development Stage Company)

Notes to Financial Statements

September 30, 2013

(Unaudited)

The Series A, Convertible Preferred Stock has the following provisions.

·	No Voting Rights
·	No Registration Rights
·	Each share is convertible into 500 shares of common stock
·	$100/share liquidation value
·	No Dividend Rate
·	Rights to dividends on as-converted basis if dividends are paid on Junior Securities stock or if Company is in default.
·	Redeemable upon “triggering events.” In case of a triggering event, the holder has the right to impose of a dividend rate on all of the outstanding Preferred Stock at 6% per annum thereafter. A triggering event occurs if the Company
	i)	fails to deliver certificates representing conversion shares;
	ii)	fails to pay the amount due pursuant to a Buy-In;
	iii)	fails to have available a sufficient number of authorized shares;
	iv)	fails to observe any covenant in the Certificate of Designation unless cured within 30 calendar days;
	v)	shall be party to a Change in Control Transaction;
	vi)	sustains a bankruptcy event;
	vii)	fails to list or quote its common stock for more than 20 trading days in a twelve month period;
	viii)	sustains any monetary judgment, writ or similar final process filed against the Company for more than $100,000 and such judgment writ or similar final process shall remain unvacated, unbonded or unstayed for a period of 45 calendar days;
	ix)	fails to comply with the Asset Coverage requirement.

·	Forced Conversion Rights – The Company may force the conversion of the Preferred Stock if the following conditions have been met:
	(i)	there is an effective and current registration statement which includes for resale all of the Common Stock underlying the Preferred Stock or such Common Stock is freely resalable pursuant to Rule 144 without any volume or manner of sale restrictions,
	(ii)	the VWAP for each of any 20 trading days during any 30 consecutive Trading Day period, which 30 consecutive Trading Day period shall not include any days prior to the execution date of the Purchase Agreement (“Threshold Period”), exceeds 200% of the Conversion Price each day during the Threshold Period (subject to adjustment for reverse and forward stock splits and the like), and
	(iii)	the average daily dollar volume of the Corporation’s Common Stock during such 30 day period exceeds $25,000 per day.

Point Capital, Inc.

(A Development Stage Company)

Notes to Financial Statements

September 30, 2013

(Unaudited)

Note 8 Stockholders’ Equity (Deficit) and Common Stock Payable

On October 31, 2013, the Company closed on a private placement and issued the following shares:

Cash - Common Stock			1,500,000			$	300,000			$	0.20
Total			1,500,000				300,000

The Company had paid direct offering costs to a third party placement agent associated with this capital raising activity with gross proceeds of $300,000 as follows:

Direct Offering Costs	October 31, 2013
Amount paid in cash	$	30,135
Amounts paid in shares (1)		183,787
	$	213,922

(1)	The placement agent associated with the capital raising activity is entitled to a maximum of 6,126,240 shares of the Company’s common stock based on total equity raised. The placement agent was engaged to assist with a financing of up to $2,000,000.

	During October 2013, the placement agent raised $300,000 (or 15% of the maximum offering), and therefore was entitled to receive 918,936 shares of the company’s common stock. These shares had a fair value of $183,787, based upon the recent cash offering price of $0.20/share, which represented the best evidence of fair value.

During 2013, the agent raised an aggregate $1,400,000 (or 70% of the maximum offering), and therefore was entitled to receive 4,288,368 shares of the company’s common stock at October 31, 2013. These shares had a fair value of $857,673, based upon the recent cash offering price of $0.20/share, which represented the best evidence of fair value. These shares while due, are not required to be issued until a final closing occurs.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

As used in this Form 10-Q, references to “Point Capital,” Company,” “we,” “our” or “us” refer to Point Capital, Inc. unless the context otherwise indicates.

Forward-Looking Statements

The following discussion should be read in conjunction with our financial statements, which are included elsewhere in this Form 10-Q (the “Report”). This Report contains forward-looking statements which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties, and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Overview

We were initially formed to focus on the business of direct-from-consumer, procurement and aggregation of precious metals to be recycled. On October 4, 2013 the Company filed to become a business development company regulated pursuant to the Investment Company Act of 1940. Through the structure of a business development company, the Company will essentially be an investment and management consulting company. The Company intends to invest in growth businesses and to provide management expertise, corporate finance capabilities and leadership to the companies which will become its portfolio companies.

Results of Operations

Comparison of Three Months Ended September 30, 2013 and 2012

Revenues

The Company is in the development stage and did not generate any revenues during the period from July 13, 2010 (inception) through September 30, 2013.

Total operating expenses

For the three months ended September 30, 2013 and the three months ended September 30, 2012, general and administrative expenses were $5,744 and $8,550, respectively. General and administrative expenses consist mainly of professional fees. The reason for the decrease of $2,806 in expenses, or approximately 33%, was a decreased need for professionals in the quarter.

Net loss

Net loss for the three-month period ended September 30, 2013 was $5,744 as compared to the net loss for the three-month period ended September 30, 2012 of $8,550. The decrease in the net loss was primarily due to decreased general and administrative fees during the quarter.

Comparison of Nine Months Ended September 30, 2013 and 2012

Revenues

The Company is in its development stage and did not generate any revenues during the period from July 13, 2010 (inception) through September 30, 2013.

Total operating expenses

For the nine months ended September 30, 2013 and the nine months ended September 30, 2012, general and administrative expenses were $51,103 and $27,257, respectively. General and administrative expenses consist mainly of professional fees. The reason for the increase of $23,846 in expenses, or approximately 87%, was an increased need for professionals, primarily due to the investment by Alpha Capital Anstalt in the Company in April 2013 and the merger of the Company from New York to Delaware and name change from Gold Swap, Inc. to the current name in the first quarter of 2013.

Net loss

Net loss for the nine-month period ended September 30, 2013 was $51,103 as compared to the net loss for the nine-month period ended September 30, 2012 of $27,257. The increase in the net loss was due to professional fees associated with the Company’s activities during the period.

Liquidity and Capital Resources

As of September 30, 2013, the Company had $1,259,100 in cash, primarily generated from the sale of 5,500,000 common shares at $0.20 per share for a total gross offering price of $1,100,000 and 4,000 shares of Series A Convertible Preferred Stock sold in April 2013 to Alpha Capital Anstalt for total gross proceeds of $400,000.

There can be no assurance that additional capital will be available to the Company if it is determined that the Company needs additional funds for its operations and proposed business. The Company has no agreements or arrangements to raise capital other than the placement agency agreement with Network 1 Financial Services Inc. to offer and sell up to $2,000,000 of common shares (of which $1,100,000 has been closed upon on September 30th, 2013 and a total of $1,400,000 has been closed upon as of the date of this filing). Total direct offering costs paid in cash were $140,330 (includes $10,000 which was accrued for at September 30, 2013, then paid in October 2013). The placement agent is also entitled to 4,288,368 shares of the company’s common stock as of the date of this filing. These shares had a fair value of $857,674, based upon the recent cash offering price of $0.20/share, which represented the best evidence of fair value. These shares while due, are not required to be issued until a final closing occurs.

We currently have no commitments with any person for any capital expenditures.

The Company believes that our existing available cash will enable the Company to meet the working capital requirements for at least 12 months. The estimated working capital requirement for the next 12 months is $95,000 with an estimated burn rate of $8,000 per month. The Company continues to explore potential expansion opportunities as a business development company in order to boost sales while leveraging distribution systems to consolidate lower costs.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Critical Accounting Policies

The Company’s discussion and analysis of its financial condition and results of operations are based upon the Company’s financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. In making those critical accounting estimates, we are required to make assumptions about matters that may be highly uncertain at the time of the estimate. Different estimates we could reasonably have used, or changes in the assumptions that could occur, could have a material effect on our financial condition or results of operations.

Derivative liabilities and Beneficial Conversion Feature

Earnings per share

Recent Accounting Pronouncements

There are no recent accounting pronouncements that are expected to have an effect on the Company’s financial statements.

Development Stage

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

As a “smaller reporting company” as defined by Rule 229.10(f)(1) as of September 30, 2013, we are not required to provide the information required by this Item 3.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

Our disclosure controls and procedures are designed to ensure that information required to be disclosed in reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the United States Securities and Exchange Commission. Our principal executive officer and principal financial officer has reviewed the effectiveness of our “disclosure controls and procedures” (as defined in the Securities Exchange Act of 1934 Rules 13(a)-15(e) and 15(d)-15(e)) within the end of the period covered by this Quarterly Report on Form 10-Q and has concluded that the disclosure controls and procedures are effective to ensure that material information relating to the Company is recorded, processed, summarized, and reported in a timely manner.

Changes in Internal Controls over Financial Reporting

There have been no changes in the Company's internal control over financial reporting during the last quarterly period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II

OTHER INFORMATION

Item 1. Legal Proceedings.

There are no pending legal proceedings to which the Company is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of voting securities of the Company, or security holder is a party adverse to the Company or has a material interest adverse to the Company. The Company’s property is not the subject of any pending legal proceedings.

Item 1A. Risk Factors

As a “smaller reporting company” as defined by Rule 229.10(f)(1) as of September 30, 2013, we are not required to provide the information required by this Item 1A.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Unregistered Sales of Equity Securities

On September 30, 2013 the Company closed a private placement of 5,500,000 common shares at $0.20 per share for a total gross offering price of $1,100,000 of which $100,000 was a subscription receivable. The Company offered its stock pursuant to Section 4(a)(2) of the Securities Act of 1933 and Rule 506(b) of Regulation D. The subscription for the shares of stock was evidenced by a purchase agreement, in which the purchaser represented to the Company that the purchaser was an accredited investor (as such term is defined under Rule 501 of Regulation D), and the transaction did not involve any form of general solicitation or advertising. The common shares were offered by Network 1 Financial Services, Inc., a broker-dealer and member of FINRA, which acted as the exclusive placement agent for the Company. The agent received cash compensation of $70,000 and a 3% non-accountable expense allowance and is entitled to 3,063,120 shares of the Company pursuant to the Placement Agency Agreement. We are using the net proceeds of the private offering for our working capital.

On October 31, 2013 the Company closed a private placement of 1,500,000 common shares at $0.20 per share for a total gross offering price of $300,000 and received $100,000 for its September 30, 2013 subscription receivable. The Company offered its stock pursuant to Section 4(a)(2) of the Securities Act of 1933 and Rule 506(b) of Regulation D. The subscription for the shares of stock was evidenced by a purchase agreement, in which the purchaser represented to the Company that the purchaser was an accredited investor (as such term is defined under Rule 501 of Regulation D), and the transaction did not involve any form of general solicitation or advertising. The common shares were offered by Network 1 Financial Services, Inc., a broker-dealer and member of FINRA, which acted as the exclusive placement agent for the Company. The agent received cash compensation of $28,000 and a 3% non-accountable expense allowance and is entitled to 1,225,248 shares of the Company pursuant to the Placement Agency Agreement. We are using the net proceeds of the private offering for our working capital.

Purchases of equity securities by the issuer and affiliated purchasers

None.

Use of Proceeds

None

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None

Item 6. Exhibits

Exhibit No.		Description

31.1		Rule 13a-14(a)/15d14(a) Certifications of Richard A Brand, the Principal Executive Officer*

31.2		Rule 13a-14(a)/15d14(a) Certifications of Vadim Mats, the Principal Financial Officer*

32.1		Section 1350 Certifications of Richard A. Brand, the Principal Executive Officer*

32.2		Section 1350 Certifications of Vadim Mats, the Principal Financial Officer*

101.INS		XBRL Instance Document**
101.SCH		XBRL Taxonomy Extension Schema Document**
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document**
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document**
101.LAB		XBRL Taxonomy Extension Label Linkbase Document**
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document**

*Filed herewith.

**Furnished herewith.

SIGNATURES

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

POINT CAPITAL, INC.

By:	/s/ Richard A. Brand
	Name: Richard A. Brand
	Title: Chairman, Chief Executive Officer and Director (Principal Executive Officer)

Dated: November 14, 2013

By:	/s/ Vadim Mats
	Name: Vadim Mats
	Title: Chief Financial Officer (Principal Financial and Accounting Officer)

Dated: November 14, 2013