VIZCONNECT, INC. - Quarter Report: 2014 March (Form 10-Q)

vizc_10q.htm

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 March 31, 2014

o	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: 001-35484

VIZCONNECT, INC.

(Exact name of registrant as specified in its charter)

Nevada		27-3687123
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1350 Main Street, Suite 1407

Springfield, Massachusetts 01103

(Address of principal executive offices (Zip Code)

(855) 849-2666

(Registrant’s telephone number, including area code)

N/A

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

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.

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	x
(do not check if smaller reporting company)

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

As of May 20, 2014, there were 60,605,000 shares of common stock, $0.001 par value per share, issued and outstanding.

VIZCONNECT, INC.

TABLE OF CONTENTS

FORM 10-Q REPORT

March 31, 2014

		Page Number
PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements.	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	23
Item 4.	Controls and Procedures.	23

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings.	25
Item 1A.	Risk Factors.	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	25
Item 3.	Defaults Upon Senior Securities.	25
Item 4.	Mine Safety Disclosures	25
Item 5.	Other Information.	25
Item 6.	Exhibits.	26

SIGNATURES		27

CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION

This Quarterly Report on Form 10-Q (this “Report”) contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements discuss matters that are not historical facts. Because they discuss future events or conditions, forward-looking statements may include words such as “anticipate,” “believe,” “estimate,” “intend,” “could,” “should,” “would,” “may,” “seek,” “plan,” “might,” “will,” “expect,” “predict,” “project,” “forecast,” “potential,” “continue” negatives thereof or similar expressions. Forward-looking statements speak only as of the date they are made, are based on various underlying assumptions and current expectations about the future and are not guarantees. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, level of activity, performance or achievement to be materially different from the results of operations or plans expressed or implied by such forward-looking statements.

We cannot predict all of the risks and uncertainties. Accordingly, such information should not be regarded as representations that the results or conditions described in such statements or that our objectives and plans will be achieved and we do not assume any responsibility for the accuracy or completeness of any of these forward-looking statements. These forward-looking statements are found at various places throughout this Report and include information concerning possible or assumed future results of our operations, including statements about potential acquisition or merger targets; business strategies; future cash flows; financing plans; plans and objectives of management, any other statements regarding future acquisitions, future cash needs, future operations, business plans and future financial results, and any other statements that are not historical facts.

These forward-looking statements represent our intentions, plans, expectations, assumptions and beliefs about future events and are subject to risks, uncertainties and other factors. Many of those factors are outside of our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Report. All subsequent written and oral forward-looking statements concerning other matters addressed in this Report and attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this Report.

Except to the extent required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise.

CERTAIN TERMS USED IN THIS REPORT

When this report uses the words “we,” “us,” “our,” and the “Company,” they refer to the combined business of VizConnect, Inc. and its subsidiary, VizConnect LLC. “SEC” refers to the Securities and Exchange Commission.

Except as otherwise indicated, the information presented in this 10-Q reflects our 4-for-1 forward stock split, which became effective as of February 25, 2013.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

VIZCONNECT, INC. AND SUBSIDARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

	As of March 31, 2014			As of December 31, 2013
	(unaudited)
ASSETS
CURRENT ASSETS
Cash	$	76,678		$	34,904
Prepaid expenses and other current assets		17,941			14,654
TOTAL CURRENT ASSETS		94,619			49,558

Property, plant and equipment - net		1,829			1,937

TOTAL ASSETS	$	96,448		$	51,495

LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
Current portion of convertible notes payable, net of discount of $81,480 and $85,583 at March 31, 2014 and December 31, 2013, respectively	$	274,020		$	32,167
Accounts payable		286,067			237,705
Accrued expenses		107,316			97,088
Deferred revenues		44,227			52,356
Notes payable- related party		24,842			22,500
Notes payable		42,011			72,000
Derivative liability		256,236			203,850
TOTAL CURRENT LIABILITIES		1,034,719			717,666

Convertible notes payable net of discount of $306,871 and $325,130 at March 31, 2014 and December 31, 2013, respectively		55,629			37,370
TOTAL LIABILITIES		1,090,348			755,036

COMMITMENTS AND CONTINGENCIES (See Note 10)

STOCKHOLDERS' DEFICIT
Preferred Stock: $0.001 par value, 5,000,000 shares authorized, 0 shares issued and outstanding as of March 31, 2014 and December 31, 2013		-			-
Common Stock: $0.001 par value, 250,000,000 shares authorized, 58,855,000 shares issued and outstanding as of March 31, 2014, and 40,680,000 shares issued and outstanding as of December 31, 2013		58,855			40,680
Additional paid in capital		1,332,593			132,752
Accumulated deficit		(2,463,753	)		(960,993	)
VizConnect, Inc. stockholders' deficit		(1,072,305	)		(787,561	)

Noncontrolling interest		78,405			84,020
Total stockholders' deficit		(993,900	)		(703,541	)

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	96,448		$	51,495

See accompanying notes to the unaudited condensed consolidated financial statements

VIZCONNECT, INC. AND SUBSIDARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

	For the three month period ended
	March 31, 2014			March 31, 2013

REVENUE
Revenue	$	64,223		$	52,683

Total Revenue		64,223			52,683

OPERATING EXPENSES
Programming, Hosting & Technology Expense		22,038			14,833
Professional Fees		411,448			61,893
General and Administrative		871,489			24,289
Selling Expense		35,828			24,809
Total Operating Expenses		1,340,803			125,824

Loss From Operations		(1,276,580	)		(73,141	)

Loss on change in fair value of derivative liability		(75,102	)
Interest Expense		(156,693	)		(7,558	)

NET LOSS BEFORE INCOME TAX		(1,508,375	)		(80,699	)

Provision for income taxes		-			-

NET LOSS	$	(1,508,375	)	$	(80,699	)

Basic and diluted loss per common share	$	(0.03	)	$	(0.00	)

Basic and diluted weighted average shares outstanding		50,484,444			33,014,222

See accompanying notes to the unaudited condensed consolidated financial statements

VIZCONNECT, INC. AND SUBSIDARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

	For the three month period ended			For the three month period ended
	March 31, 2014			March 31, 2013
CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss	$	(1,502,760	)	$	(80,699	)
Adjustments to Reconcile Net Loss To Net Cash Used in Operating Activities:
Net loss attributable to noncontrolling interest		(5,615	)		-
Depreciation Expense		108			-
Amortization of debt discount		109,372			-
Loss on change in fair value of derivative liability		75,102			-
Stock issued for services		1,137,300			-
Changes in Operating Assets and Liabilities:
Prepaid Expenses		(3,287	)		(1,261	)
Accounts Payable		48,363			42,192
Accrued Expenses		15,070			23,420
Deferred Revenue		(8,129	)		14,194
Net Cash Used In Operating Activities		(134,476	)		(2,154	)

CASH FLOWS FROM INVESTING ACTIVITIES:		-			-

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes payable - related party		-			2,500
Repayment of notes payable - related party		(2,500	)		-
Proceeds from notes payable		313,000			-
Repayment of notes payable		(134,250	)		-
Equity grants - consultants		-			15,000
Net Cash Provided by Financing Activities		176,250			17,500

NET INCREASE IN CASH		41,774			15,346

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		34,904			19,842

CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	76,678		$	35,188

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash Paid for Interest	$	63,542		$	-
Cash Paid for Taxes	$	-		$	-

SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:

During the three months ended March 31, 2014 the Company converted $4,842 of interest to principal on notes payable - related party

During the three months ended March 31, 2014 the Company reclassified $80,716 of derivative liability into additional paid in capital upon the repayment of the note

See accompanying notes to the unaudited condensed consolidated financial statements

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

(A) Basis of Presentation

The accompanying unaudited condensed consolidated 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 Securities and Exchange Commission for interim financial information. Accordingly, they do not include all the information necessary for comprehensive presentation of financial position and results of operations.

VizConnect, Inc. (the "Company") was setup as a corporation under the laws of the State of Nevada on October 15, 2010. The Company, through its wholly-owned subsidiary, VizConnect LLC, a Massachusetts limited liability company, provides cloud based marketing services using a combination of mobile video marketing, video storage, and cloud computing in one easy to access system for a monthly fee. The Company’s year-end is December 31.

On February 13, 2013, VizConnect, Inc. consummated a share exchange with VizConnect LLC. Under the terms of the share exchange, the members of VizConnect LLC received 25,000,000 shares of the common stock of VizConnect, Inc. for 100% of the issued and outstanding member’s interest of VizConnect LLC. As a result of the transaction, the members of VizConnect LLC became the majority owners of VizConnect, Inc. and VizConnect LLC became a wholly-owned subsidiary.

The reverse merger is deemed a capital transaction and the net assets of VizConnect LLC (the accounting acquirer) are carried forward to the VizConnect, Inc. (the legal acquirer and the reporting entity) at their carrying value before the combination. The acquisition process utilizes the capital structure of VizConnect, Inc. and the assets and liabilities of VizConnect LLC, which are recorded at historical cost. The equity of VizConnect, Inc. is the historical equity of VizConnect LLC retroactively restated to reflect the number of shares issued by the Company in the transaction.

In connection with this transaction, the historical shareholders of VizConnect, Inc. were deemed to have been issued 15,680,000 shares of common stock upon completion of the reverse merger.

On February 23, 2013, VizConnect, Inc. concluded a 4-for-1 stock split, following which there were 40,680,000 shares of common stock issued and outstanding.

On October 29, 2013, the Company formed a majority owned subsidiary to conduct business solely in Canada. The majority owned subsidiary is included in the consolidated financial statements of the Company at its formation. The non-controlling interest investors have contibuted $100,000 into the subsidiary, which represents 20% ownership. The Company owns the remaining 80% of the subsidiaries.

It is management’s opinion that all material adjustments (consisting of normal reoccurring adjustments) have been made, which are necessary for a fair financial statement presentation. The results for the interim period are not necessarily indicative of the results expected for the year.

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

(B) Principal of Consolidation

The accompanying 2014 and 2013 unaudited condensed consolidated financial statements include the accounts of VizConnect, Inc., VizConnect LLC and its 80% owned-subsidiary, VizConnect Canada from the date of incorporation (October 29, 2013).

In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates include the calculation of deferred revenue during the period and determinations of fair values of certain financial instruments

(D) Cash and Cash Equivalents

The Company considers all highly liquid temporary cash investments with an original maturity of three months or less to be cash equivalents. At March 31, 2014 and December 31, 2013, the Company had no cash equivalents.

(E) Income Taxes

The Company accounts for income taxes in accordance with FASB ASC 740 "Accounting for Income Taxes". Under this approach, deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and their liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized.

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

(F) Software Development Costs

We expense software development costs to be marketed to external users, before technological feasibility of such products is reached. We have determined that technological feasibility is reached shortly before the release of those products and as a result, the development costs incurred after the establishment of technological feasibility and before the release of those products were not material, and accordingly, were expensed as incurred. Software development costs totaled $22,038 and $14,833 for the three-months periods ended March 31, 2014 and 2013, respectively.

(G) Business Segments

The Company operates in one segment and therefore segment information is not presented.

(H) Revenue Recognition

The Company will recognize revenue on arrangements in accordance with FASB ASC No. 605, “Revenue Recognition”. In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.

The Company recognizes revenue from monthly subscriptions fees in the month in which services are provided.

The Company recognizes revenue from set up fees at the time the initial set up is complete and the fees are earned.

The Company recognizes revenue from distributor membership fees monthly over the one year membership period. Any fees collected in which the services are not provided are recorded as deferred revenue.

(I) Selling Expenses

The Company incurs selling expenses under a “multi-level” compensation plan, which includes commissions for subscription sales made and bonuses for assisting associated distributors in closing initial subscription sales. Commissions are earned from direct sales as well as the sales made through the sales network they have developed. Accrued commissions payable was $49,458 and $42,057 as of March 31, 2014 and December 31, 2013, respectively.

(J) Concentrations

As of March 31, 2014 and 2013, respectively, the Company has no customers whose sales account for more than 10% of total sales.

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

(K) Property and Equipment

Property and equipment is recorded at cost. Additions and betterments are capitalized; maintenance and repairs are expensed as incurred. Depreciation is calculated using the straight-line method over the asset’s estimated useful life, which is 5 years for furniture. Gains and losses on disposal are charged to operations.

(L) Fair Value Measurements

The Company’s capital structure includes the use of convertible debt features that are classified as derivative financial instruments. Derivative financial instruments are recognized as either assets or liabilities and are measured at fair value in accordance with FASB ASC 815 “Derivatives and Hedging”. ASC 815 requires that changes in fair value of derivative financial instruments with no hedging designation be recognized as gains (losses) in the earnings statement. Fair value measurement and disclosures are determined in accordance with FASB ASC 820 “Fair Value Measurements and Disclosures”.

FASB ASC 820 establishes a framework for measuring fair value by creating a hierarchy for observable independent market inputs and unobservable market assumptions and expands disclosures about fair value measurements. Considerable judgment may be required in interpreting market data used to develop the estimates of fair value. Accordingly, the estimates present herein are not necessarily indicative of the amounts that could be realized in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value.

The following inputs are used in the valuation of the financial assets and liabilities.

Level 1 - Inputs represent unadjusted quoted prices for identical assets and liabilities exchanged in active markets.

Level 2 - Inputs include directly or indirectly observable inputs other than Level 1 inputs such as quoted prices for similar assets or liabilities exchanged in active or inactive markets; quoted prices for identical assets or liabilities exchanged in inactive markets; other inputs that are considered in fair value determinations of the assets or liabilities, such as interest rates or yield curves that are observable at commonly quoted intervals, volatilities, repayment speeds, loss severities, credit risks and default rates; and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3 - Inputs include unobservable inputs used in the measurement of assets and liabilities. Management is required to use its own assumptions regarding unobservable inputs, because there is little, if any, market activity in the assets or liabilities or related observable inputs that can be corroborated at the measurement date. Measurements of non-exchange traded derivative contract assets and liabilities are primarily based on valuation models, discounted cash flow models or other valuation techniques that are believed to be used by market participants. Unobservable inputs require management to make certain projections and assumptions about the information that would be used by market participants in pricing assets and liabilities.

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

The fair values of financial instruments that include cash and amounts due to related parties were estimated to approximate their carrying values due to the immediate or relatively short maturity of these instruments.

The Company’s operations and financing activities are conducted primarily in United States dollars, and as a result are not subject to significant exposure to market risks from changes in foreign currency rates. Management has determined that the Company is not exposed to significant credit risk.

The following is a summary of liabilities measured at fair value on a recurring basis at March 31, 2014:

Description	Total Fair Value		Level 1	Level 2	Level 3
Derivatives:
Conversion Feature Liability	$	256,236			$	256,236
Total derivatives	$	256,236			$	256,236

The following is a summary of liabilities measured at fair value on a recurring basis at December 31, 2013:

Description	Total Fair Value		Level 1	Level 2	Level 3
Derivatives:
Conversion Feature Liability	$	203,850			$	203,850
Total derivatives	$	203,850			$	203,850

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

The changes in derivatives measured at fair value for which, the Company has used Level 3 inputs to determine fair value at March 31, 2014 are as follows:

		Q1 2014
Beginning of the year	$	203,850
Additional loans		58,000
Loss on change in fair value		75,102
Settlements		(80,716	)
End of the quarter	$	256,236

The following is a description of the valuation methodology used for liabilities measured at fair value.

Conversion feature liability – The fair value of the derivative instrument was estimated using the Black Scholes option pricing model. (See Note 7)

(M) Re-classifications

Certain amounts from prior periods have been reclassified to conform to the current period presentation. These reclassifications had no impact on the Company’s net loss or cash flows.

(N) Loss per Share

The Company computes net loss per share in accordance with FASB ASC 260 “Earnings per Share”. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including stock options, using the treasury stock method, and convertible preferred stock, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential common shares if their effect is anti-dilutive.

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

The following summarizes potential anti-dilutive shares:

	March 31, 2014		March 31, 2013
(number of shares)
Convertible notes		8,302,887		-
Total		8,302,887		-

(O) Recent Account Pronouncements

Recent accounting pronouncements issued by the Financial Accounting Standards Board (FASB) (including its Emerging Issues Task Force), the AICPA, and the SEC, did not, or are not believed by management, to have a material impact on the Company’s present or future financial statements.

NOTE 2 GOING CONCERN

The Company had a net loss of $1,508,375 for the three months ended March 31, 2014, a Stockholders’ deficit of $993,900 and a working capital deficit of $940,100 as of March 31, 2014. This raises substantial doubt about its ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital through member contributions and implement its business plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Management believes that actions presently being taken to obtain additional funding through implementing its strategic plans, multilevel marketing strategy and sales incentives to expand operations and will provide the opportunity for the Company to continue as a going concern.

NOTE 3 NOTES PAYABLE-RELATED PARTY

During 2011, the Company entered into two notes payable for a total of $22,500. The Notes have an interest rate of 10%, are unsecured, and due March 15, 2012. On February 14, 2014, these notes plus accrued interest were converted into a new note due on November 14, 2014 with an interest rate of 15%. During the three month ended March 31, 2014, $2,500 was repaid. The Company also converted $4,842 of interest to principal on the notes. As of March 31, 2014 and December 31, 2013, the total amount outstanding is $24,842 and $22,500 respectively. Accrued interest totaled $459 and $5,171 as of March 31, 2014 and December 31, 2013, respectively.

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

NOTE 4 NOTES PAYABLE

During 2011, The Company entered into a note payable for $15,000. The Note has an interest rate of 2% monthly, is unsecured, and due on demand. As of March 31, 2014 and December 31, 2013, the total amount outstanding is $13,000. Accrued interest totaled $8,489 and $7,720 as of March 31, 2014 and December 31, 2013, respectively.

On February 4, 2014, the Company received $35,000 in exchange for accounts receivable of $47,915. The amount is repayable on a daily basis whereby the Company pays $300 per day. As of March 31, 2014, $29,011 was owed under this agreement.

NOTE 5 CONVERTIBLE NOTES PAYABLE

During 2013, the Company received various unsecured convertible loans totaling $215,250 and converted loans payable in the amount of $310,000 to convertible notes payable (See Note 6). During 2013, the Company repaid one convertible note payable in the amount of $42,500. During the first quarter of 2014, the Company repaid loans of $42,500, $59,000 and $32,750. The remaining convertible loans have interest rates of $8% and 15% per year and mature at various dates through March 2018.

NOTE 6 LOANS PAYABLE-RELATED PARTY

During 2012 the Company received various unsecured loans totaling $310,000. The loans have an interest rate of 7% per year and mature at various days through November 2017. During 2013, the loans were converted into convertible notes payable (See Note 5).

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

The following is a summary of the unsecured convertible loans:

Origination date	Maturity Date	Interest Rate			Principal, March 31, 2014			Current Portion			Long-term
February 2013	February 2018		8	%	$	312,500		$	-0-		$	312,500
May 2013	March 2018		12	%	$	20,000		$	-0-		$	20,000
June 2013	March 2018		12	%	$	30,000		$	-0-		$	30,000
November 2013	August 2014		8	%	$	42,500		$	42,500		$	-0-
December 2013	September 2014		8	%	$	58,000		$	58,000		$	-0-
January 2014	January 2015		15	%	$	10,000		$	10,000		$	-0-
January 2014	January 2015		15	%	$	10,000		$	10,000		$	-0-
February 2014	February 2015		15	%	$	10,000		$	10,000		$	-0-
March 2014	May 2014		6.67	%	$	60,000		$	60,000		$	-0-
March 2014	June 2014		10	%	$	90,000		$	90,000		$	-0-
March 2014	June 2014		173	%	$	75,000		$	75,000		$	-0-
Discount Notes payable					$	(388,351	)	$	(81,480	)	$	(306,871	)
Total					$	329,649		$	274,020		$	55,629

Interest recognized for the three month periods ended March 31, 2014 and March 31, 2013 were $156,693 and $7,558 respectively.

NOTE 7 DERIVATIVES

The company has entered into convertible notes of $718,000 with certain investors. The notes can be converted following a holding period provided in the promissory note agreement, and at a set price per share, subject to certain re-set provision. This includes price protection terms, which would reset the per-share purchase price if the Company were obligated to convert other convertible liabilities at a lower per share purchase price.

The derivative liability is recorded at fair value on the Company’s financial statements, and any changes in their fair value are included in the consolidated statement of operations as a non-cash item.

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

The derivative liability is revalued and reported at fair value of $256,236 and $203,850 as of March 31, 2014 and December 31, 2013 respectively. (See Note 11).

The fair value of the convertible notes was estimated using the Black Scholes option pricing model with the following assumptions for the three months ended March 31, 2014.

Risk free interest rate		.05% and 1.32% based on expected life

Dividend yield		0%

Expected volatility		278%

Expected life (range in years)		.22 to 3.92

NOTE 8 STOCKHOLDERS’ EQUITY

On August 10, 2013, the Company entered into a six month consulting agreements for 5,000,000 shares of common stock. The Company expensed the fair value of $321,800 related to the portion earned during the three months ended, March 31, 2014.

On January 1, 2014, the Company entered into a six month consulting agreements for 1,000,000 shares of common stock. The Company expensed the fair value of $25,000 related to the portion earned through March 31, 2014.

On February 11, 2014, the Company granted 13,175,000 shares of common stock to its board of directors. The Company expensed the fair value of $790,500 related to the portion earned through March 31, 2014.

NOTE 9 RELATED PARTY TRANSACTIONS

During 2011, the Company entered into two notes payable for a total of $22,500. On February 14, 2014, these notes plus accrued interest were converted into a new note due on November 14, 2014 with an interest rate of 15%. As of March 31, 2014 and December 31, 2013, the total amount outstanding is $24,842 and $22,500 respectively. Accrued interest totaled $459 and $5,171 as of March 31, 2014 and December 31, 2013, respectively.

During 2012, the Company received various unsecured loans from a related party totaling $310,000. The loans have an interest rate of 8% per year and mature at various days through November 2017. During 2013, the loans were converted into convertible notes payable (See Notes 5 and 6).

During the year ending December 31, 2013, the Company incurred software development expenses totaling $9,800 from a company owned by an officer. As of March 31, 2014, the total amount owed to the related vendor is $42,500 and is recorded in accounts payable.

VIZCONNECT, INC. AND SUBSIDARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF MARCH 31, 2014

(UNAUDITED)

NOTE 10 SUBSEQUENT EVENTS

The Company entered into a consulting agreement with TOGI Capital Corp dated May 9 2014. The payment is in the form of restricted shares (250,000).

On May 16, 2014, the Company has repaid one of its current convertible notes in the amount of $42,500.

On May 15, 2014, the Company entered into a $100,000 promissory note with an interest rate of 10% and term of 2 months.

On May 14, 2014, the Company entered into an agreement with Allen Simon to serve on the Company’s Advisory Board for one year. He will receive 500,000 shares of common stock over his service term.

During April 2014, one of the long term convertible notes of $93,575 was converted into common stock. This note was part of the financing associated with the corporate restructuring associated with the VB Clothing Shell.

The convertible note of $60,000 due May 21, 2014 has been extended to June 21, 2014 with an additional $3,000 of accrued interest due at maturity.

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

The following discussion provides information which management believes is relevant to an assessment and understanding of our results of operations and financial condition. The discussion should be read along with our financial statements and notes thereto contained elsewhere in this Report. The following discussion and analysis contains forward-looking statements, which involve risks and uncertainties. Our actual results may differ significantly from the results, expectations and plans discussed in these forward-looking statements.

Overview

The Company was incorporated in the State of Nevada on October 15, 2010. We assist companies across a wide array of industries in utilizing mobile devices and technologies to create targeted branding and advertising campaigns. Our proprietary video marketing platform (the “Platform”) allows companies to integrate traditional print media with mobile Text-to-Video messages, activate and optimize their web portals, and build mobile marketing databases. Our Platform utilizes unique keyword-activated campaigns that engage mobile users with video and automated call-to-action prompts. This dynamic, cloud-based marketing tool has small business applications, enterprise solutions for large companies, and white-label opportunities for marketing and communications firms.

On February 13, 2013 (the “Closing Date”), we entered into a Share Exchange Agreement (the “Exchange Agreement”) with (i) VizConnect LLC (“VizConnect”), (ii) all of the members of VizConnect (the “Members”) and (iv) our former principal shareholder pursuant to which we acquired all of the outstanding units of VizConnect in exchange for the issuance of 25,000,000 shares of our common stock to the Members (the “Share Exchange”). The shares issued to the Members in the Share Exchange constituted approximately 61.46% of our issued and outstanding shares of common stock as of and immediately after the consummation of the Share Exchange. In connection with the closing, 40,000,000 shares of our common stock held by our former principal shareholder have been cancelled. As a result of the Share Exchange, VizConnect became our wholly owned subsidiary.

The acquisition is being accounted for as a “reverse merger,” and VizConnect is deemed to be the accounting acquirer in the reverse merger. Consequently, the assets and liabilities and the historical operations that will be reflected in the financial statements prior to the acquisition will be those of VizConnect and will be recorded at the historical cost, and the consolidated financial statements after completion of the acquisition will include the assets, liabilities and operation of the Company and VizConnect from the closing date of the acquisition. As a result of the issuance of the shares of common stock pursuant to the Exchange Agreement, a change in control of occurred as a result of the acquisition.

In connection with the closing of the Exchange Agreement, Mr. Anthony Pasquale, the Company’s principal shareholder, agreed to cancel his 10,000,000 pre-split (or 40,000,000 post-split) shares of common stock that he owned in the Company and we issued 6,250,000 pre-split (or 25,000,000 post-split) shares to members of VizConnect. Additionally, the existing officers and directors from the Company resigned from its board of directors and all officer positions effective immediately after the closing of the reverse merger. Accordingly, our Board of Directors appointed Mr. Paul Cooleen as our President, Mr. Brian Dee as our Secretary, and Mr. James Henderson as our Treasurer, effective upon the closing of the Share Exchange.

The Company’s directors approved the Exchange Agreement and the transactions contemplated thereby. Simultaneously, the Members of VizConnect also approved the Exchange Agreement and the transactions contemplated thereby.

As a result of the Exchange Agreement, the Company ceased its prior business and acquired 100% of the mobile marketing operations of VizConnect, the business and operations of which now constitutes its primary business and operations. Specifically, as a result of the Exchange Agreement on February 13, 2013:

	●	The Company acquired and now owns 100% of the issued and outstanding units of VizConnect LLC, a Massachusetts limited liability company and their mobile marketing business; and
	●	The Company issued 25,000,000 shares of common stock to the Members of VizConnect, constituting approximately 61.46% of the issued and outstanding common stock.

As a result of the Company’s reverse acquisition of VizConnect, the Company has assumed the business and operations of VizConnect with its principal activities engaged in the mobile marketing platform business.

We effected a 4-for-1 forward stock split, which became effective as of February 25, 2013.

On or about April 13, 2013, the Company received written consents in lieu of a meeting of Stockholders from stockholders holding 50.86% of the outstanding shares of the Company’s common stock. This written consent authorized the Company to amend its Articles of Incorporation to change the name of the Company from “VB Clothing, Inc.” to “VizConnect, Inc.” and to increase the number of authorized shares of common stock, par value $0.001, from 70,000,000 to 250,000,000. The Certificate of Amendment, referencing these amendments, was recorded with the State of Nevada on May 10, 2013.

Three Months Ended March 31, 2014 Compared with Three Months Ended March 31, 2013

Revenue:

Revenues for the three-month period ending March 31, 2014 were $64,223, compared with $ 52,683 for the three month period ending March 31, 2013, reflecting an increase of 22%. The increase in revenues during the periods was primarily attributable to the growth of the network marketing sales model.

Operating Expenses:

Operating expenses for the three-month period ending March 31, 2014 were $1,340,803 compared with $125,824 for the three month period ending March 31, 2013, reflecting an increase of 965%. The increase in operating expenses was primarily attributable to building our infrastructure /sales model, large professional fees, stock issuance of common restricted stock to the board directors and the payment to vendors.

Loss from Operations:

We incurred losses from operations totaling $1,276,580 for the three-month period ending March 31, 2014, compared to losses from operations totaling $ 73,141 for the three -month period ending March 31, 2013, reflecting an increase of 1,645% The increase in losses from operations was primarily attributable to professional fees and sales expenses, stock issuance of common restricted stock to directors.

Other Expense (Income):

The Company had other expenses for the three-month period ending March 31, 2014 in the amount of $231,795. This is comprised of a loss on the change in the market value of a derivative liability of $75,102 and interest expense $156,693, compared with $7,558 of interest expense for the three-month period ending March 31, 2013, reflecting an increase of 2,967%. The company has derivative losses in the first quarter of 2014 associated with the fair market value on the company's stock. The increase in interest expense is primarily associated with the increased cost of borrowing associated with the company’s convertible debt.

Net loss:

We incurred a net loss of $1,508,375 or 2,089% of revenues, for the three-month period ending March 31, 2014, compared to a net loss of $80,699 or 153% of revenues, for the three-month period ending March 31, 2013. The increase in loss is attributable to the stock issuance of common restricted stock to directors, interest on notes, professional fees and the increased cost of borrowing.

Plan of Operations

VizConnect is a cloud-based, video marketing services provider that assists companies across a wide array of industries in utilizing mobile devices and technologies to create targeted branding and advertising campaigns. Our proprietary video marketing platform (the “Platform”) allows companies to integrate traditional print media with mobile Text-to-Video messages, activate and optimize their web portals, and build mobile marketing databases. Our Platform utilizes unique keyword-activated campaigns that engage mobile users with video and automated call-to-action prompts. This dynamic, cloud-based marketing tool has small business applications, enterprise solutions for large companies, and white-label opportunities for marketing and communications firms.

By the end of fiscal year 2014, we plan to begin expanding our customer reach internationally.

Critical Accounting Policies and Estimates

Organization

The Company was incorporated in the State of Nevada on October 15, 2010. The Company provides cloud based marketing services using a combination of mobile video marketing, video storage, and cloud computing in one easy to access system for a monthly fee. The Company’s year-end is December 31.

Use of Estimates

Cash and Cash Equivalents

The company considers all highly liquid temporary cash investments with an original maturity of three months or less to be cash equivalents. At March 31, 2014 and December 31, 2013 the company had no cash equivalents.

Income Taxes

The Company accounts for income taxes under FASB Accounting Standards Codification Topic 740, Income Taxes. Under FASB Accounting Standards Codification Topic 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under FASB Accounting Standards Codification No. 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Advertising Costs

Advertising Costs are expensed in the period when the advertisements have reached their intended users. Advertising expense during the three months ended March 31, 2014 and 2013 were $0 and $0, respectively.

Software Development Costs

We expense software development costs to be marketed to external users, before technological feasibility of such products is reached. We have determined that technological feasibility is reached shortly before the release of those products and as a result, the development costs incurred after the establishment of technological feasibility and before the release of those products were not material, and accordingly, were expensed as incurred. Software development costs totaled $22,037 and $14,833, for the three months ended March 31, 2014 and 2013, respectively.

Business Segments

The Company operates in one segment and therefore segment information is not presented.

Revenue Recognition

The Company will recognize revenue on arrangements in accordance with FASB ASC Topic 605, “Revenue Recognition”. In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured. The Company recognizes revenue from monthly subscriptions fees in the month in which services are used. Because a portion of the fees are earned over a month period, any fees collect in which the services are not provided are recorded as deferred revenue. The Company recognizes revenue from set up fees at the time the initial set up is complete and the fees are earned. The Company recognizes revenue from distributor membership fees monthly over the one year membership period. Any fees collected in which the services are not provided are recorded as deferred revenue.

Concentrations

As of March 31, 2014, the Company has no customers whose sales account for more than 10% of total sales.

Fair Value of Financial Instruments

The carrying amount reported in the balance sheet for accounts payable approximate fair value based on the short-term maturity of these instruments.

Recent Accounting Pronouncements

Liquidity and Capital Resources

Our cash and cash equivalents is $76,678, and we have a working capital deficit of $940,100, as of March 31, 2014. Despite capital contributions and sales, and both related party and third party loan commitments, we may experience cash flow shortages that can slow our expected growth. We have primarily financed our activities from loans from related and third parties. A significant portion of the funds raised from loans from related and third parties have been and will be used to cover working capital needs such as office expenses, software development expenses and various professional fees.

Our cash flow requirements during this period have been met by contributions of capital and debt financing, plus receipts from sales of the Company’s services and from membership fees from the Company’s distributors. We anticipate that financing will be required until such time as we are able to generate adequate cash flow from operations to support both our cash needs for normal operations, and to support the cash needs for our investment into additional resources and assets to support our growth. Currently we cannot determine when either will occur and as such we will need to obtain financing to cover our costs for the foreseeable future. We continue to seek financing sources, such as those described herein below, as well as others, in order to continue funding normal operations. However, no assurance can be given that these sources of financing will continue to be available. If we are unable to generate profits, or unable to obtain additional funds for its working capital needs, we may have to curtail normal operations, or cease operations completely.

Between March 2013 and May 2013, a shareholder contributed $20,000 in capital to the Company for the purpose of paying certain professional fees.

On May 6, 2013, the Company made available to certain investors a private placement memorandum, pursuant to which the Company offered convertible promissory notes, at a purchase price of $10,000 per note. In response to such offer, the Company closed on sales of single notes to five (5) individuals, on May 23, May 30, June 24 and June 30, 2013, resulting in total net proceeds to the Company of $50,000. The notes bear interest at the rate of 12% per annum. All interest and principal must be repaid on March 1, 2018. Each note may be converted, in whole or in part, into common stock of the Company at any time beginning on March 1, 2014 and ending on March 1, 2018. At the time an investor elects to convert a note, such note is convertible into shares of the Company’s common stock at a conversion price of $0.14 per share. The Company used the proceeds therefore for working capital purposes, including software development associated with the Company’s compensation system and new short code texting service.

On June 26, 2013 and September 2013, the Company entered into two Securities Purchase Agreements with Asher Enterprises, Inc. ("Asher"), for the sale of two 8% convertible notes in the principal amounts of $42,500 and $42,500, respectively. The financings closed on July 11, 2013 and September 2013, respectively. The notes bear interest at the rate of 8% per annum. All interest and principal must be repaid on May 28, 2014 and June 2014, respectively. The notes are convertible into common stock, at Asher’s option, at a 42% discount to the average of the three lowest closing bid prices of the common stock during the 10 trading day period prior to conversion.

In September 2013, the Company entered into a Securities Purchase Agreement with Auctus Private Equity Fund, LLC (“Auctus”), for the sale of an 8% convertible note in the principal amount of $32,750. The note bears interest at the rate of 8% per annum. All interest and principal must be repaid by June 24, 2014. The note is convertible into common stock, at Auctus’ option, at a 42% discount to the average of the two lowest closing bid prices of the common stock during the 20 trading day period prior to conversion.

Going Concern

Off-balance Sheet Commitments and Arrangements

We have no off-balance sheet transactions, arrangements, obligations (including contingent obligations), or other relationships with unconsolidated entities or other persons that have, or may have, a material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are a Smaller Reporting Company and are not required to provide the information under this item.

Item 4. Controls and Procedures.

Disclosure of controls and procedures.

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports, filed under the Securities Exchange Act of 1934, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives. In reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. In addition, the design of any system of controls also is based in part upon 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. Over time, a control may become inadequate because of changes in conditions or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

As required by the SEC Rule 13a-15(b), we carried out an evaluation under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective at the reasonable assurance level due to the material weaknesses described below.

In light of the material weaknesses described below, we performed additional analysis and other post-closing procedures to ensure our financial statements were prepared in accordance with generally accepted accounting principles. Accordingly, we believe that the financial statements included in this report fairly present, in all material respects, our financial condition, results of operations and cash flows for the periods presented.

A material weakness is a control deficiency (within the meaning of the Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 2) or combination of control deficiencies that result in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. Management has identified the following two material weaknesses which have caused management to conclude that as of March 31, 2014 our disclosure controls and procedures were not effective at the reasonable assurance level:

We do not have written documentation of our internal control policies and procedures. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act which is applicable to us for the quarter ended March 31, 2014. Management evaluated the impact of our failure to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

To address these material weaknesses, management performed additional analyses and other procedures to ensure that the financial statements included herein fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented.

Changes in internal controls over financial reporting.

There has been no change in our internal control over financial reporting that occurred during the fiscal quarter covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

We are not currently involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

Item 1A. Risk Factors.

We are a Smaller Reporting Company and are not required to provide the information under this item.

Item 2. Unregistered Sales of Equity Securities and 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 Number		Exhibit Title

31.1*		Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1+		Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS**		XBRL Instance Document

101.SCH**		XBRL Taxonomy Schema

101.CAL**		XBRL Taxonomy Calculation Linkbase

101.DEF**		XBRL Taxonomy Definition Linkbase

101.LAB**		XBRL Taxonomy Label Linkbase

101.PRE**		XBRL Taxonomy Presentation Linkbase

__________________

* Filed herewith.

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

+ In accordance with SEC Release 33-8238, Exhibit 32.1 is being furnished and not filed.

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.

	VizConnect, Inc.

Dated: May 20, 2014	By:	/s/ Paul Cooleen
		Paul Cooleen
		President, Chief Executive Officer, and Chief Financial Officer (Principal Executive Officer and Principal Financial and Accounting Officer)