Attached files
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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x
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QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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FOR THE QUARTERLY PERIOD ENDED March 31, 2010
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from ________to________
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Commission File Number: 000-52979
Swinging Pig Productions, Inc.
(Exact name of small business issuer as specified in its charter)
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Florida
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75-3160134
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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18 W. 21st Street, 5th floor New York, NY 10010
(Address of principal executive offices)
(646) 727-9272
(Issuer’s Telephone Number)
Indicate by check mark whether the registrant (1) has 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. x Yes o No
Indicate by check mark whether the registrant is a large accelerated file, 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.
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Large accelerated filer
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o
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Accelerated filer
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o
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Non-accelerated filer
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o (Do not check if a smaller reporting company)
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Smaller reporting company
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x
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). x Yes o No
State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practical date. As of May 17, 2010, the issuer the following classes of its stock issued and outstanding: Class: Common Stock, $0.001 Par Value: 2,168,000 shares outstanding.
1
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
TABLE OF CONTENTS
Page
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Consolidated Balance Sheets (Unaudited)
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3 |
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Consolidated Statements of Operations (Unaudited)
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4 |
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Consolidated Statements of Changes in Stockholders’ Deficit (Unaudited)
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5 |
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Consolidated Statements of Cash Flows (Unaudited)
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7 |
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Notes to Financial Statements (Unaudited)
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8 |
2
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
MARCH 31, 2010 AND DECEMBER 31, 2009
ASSETS
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2010
(Unaudited)
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2009
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Current assets
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Cash
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$ | 93 | $ | 386 | ||||
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Total current assets
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93 | 386 | ||||||
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Total assets
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$ | 93 | $ | 386 | ||||
LIABILITIES AND STOCKHOLDERS’ DEFICIT
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Current liabilities
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Accounts payable and accrued expenses
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$ | 2,208 | $ | 2,111 | ||||
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Related party payables
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130,352 | 124,352 | ||||||
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Total current liabilities
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132,560 | 126,463 | ||||||
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Stockholders’ deficit
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Common stock, $.001 par value;
50,000,000 shares authorized,
2,168,000 shares issued and outstanding
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2,168 | 2,168 | ||||||
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Additional paid-in capital
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241,032 | 241,032 | ||||||
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Deficit accumulated during the development stage
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(375,667 | ) | (369,277 | ) | ||||
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Total stockholders’ deficit
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(132,467 | ) | (126,077 | ) | ||||
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Total liabilities and stockholders’ deficit
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$ | 93 | $ | 386 | ||||
See Notes to Financial Statements.
3
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
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For the Three
Months Ended
March 31,
2010
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For the Three
Months Ended
March 31,
2009
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For the Period
from Inception
(June 25, 2004) through
March 31,
2010
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Net revenue
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$ | - | $ | - | $ | - | ||||||
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Operating expenses
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Production costs
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222 | 222 | 142,207 | |||||||||
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Management fees
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6,000 | - | 138,000 | |||||||||
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Legal and professional
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- | - | 28,477 | |||||||||
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General and administrative
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168 | 603 | 66,983 | |||||||||
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Total operating expenses
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6,390 | 825 | 375,667 | |||||||||
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Loss from operations
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(6,390 | ) | (825 | ) | (375,667 | ) | ||||||
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Other income (expense), net
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- | - | - | |||||||||
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Loss before income taxes
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(6,390 | ) | (825 | ) | (375,667 | ) | ||||||
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Provision for income taxes
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- | - | - | |||||||||
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Net loss
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$ | (6,390 | ) | $ | (825 | ) | $ | (375,667 | ) | |||
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Net loss per common share –
basic and diluted
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$ | (0.00 | ) | $ | (0.00 | ) | $ | (0.18 | ) | |||
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Weighted average of common
shares – basic and diluted
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2,168,000 | 2,168,000 | 2,115,550 | |||||||||
See Notes to Financial Statements.
4
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT
FOR THE PERIOD FROM INCEPTION (JUNE 25, 2004) THROUGH MARCH 31, 2010
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Deficit
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Common Stock
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Accumulated
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Number of
Shares
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Amount
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Additional Paid-In
Capital
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During
Development Stage
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Total Stockholders’ Equity (Deficit)
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Balance, June 25, 2004
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- | $ | - | $ | - | $ | - | $ | - | |||||||||||
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Issuance of founders’ common stock, June 26, 2004
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1,200,000 | 1,200 | - | - | 1,200 | |||||||||||||||
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Issuance of common stock for cash, October 5, 2004
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894,000 | 894 | 222,606 | 223,500 | ||||||||||||||||
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Net loss
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- | - | - | (124,238 | ) | (124,238 | ) | |||||||||||||
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Balance, December 31, 2004
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2,094,000 | 2,094 | 222,606 | (124,238 | ) | 100,462 | ||||||||||||||
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Issuance of common stock for cash, March 11, 2005
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74,000 | 74 | 18,426 | 18,500 | ||||||||||||||||
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Net loss
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- | - | - | (98,365 | ) | (98,365 | ) | |||||||||||||
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Balance, December 31, 2005
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2,168,000 | 2,168 | 241,032 | (222,603 | ) | 20,597 | ||||||||||||||
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Net loss
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- | - | - | (37,385 | ) | (37,385 | ) | |||||||||||||
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Balance, December 31, 2006
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2,168,000 | 2,168 | 241,032 | (259,988 | ) | (16,788 | ) | |||||||||||||
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Net loss
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- | - | - | (32,757 | ) | (32,757 | ) | |||||||||||||
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Balance, December 31, 2007
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2,168,000 | 2,168 | 241,032 | (292,745 | ) | (49,545 | ) | |||||||||||||
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Net loss
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- | - | - | (38,751 | ) | (38,751 | ) | |||||||||||||
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Balance, December 31, 2008
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2,168,000 | 2,168 | 241,032 | (331,496 | ) | (88,296 | ) | |||||||||||||
See Notes to Financial Statements.
5
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT
FOR THE PERIOD FROM INCEPTION (JUNE 25, 2004) THROUGH MARCH 31, 2010
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Deficit
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Common Stock
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Accumulated
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Number of
Shares
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Amount
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Additional Paid-In
Capital
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During
Development Stage
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Total Stockholders’ Equity (Deficit)
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Balance, December 31, 2008
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2,168,000 | 2,168 | 241,032 | (331,496 | ) | (88,296 | ) | |||||||||||||
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Net loss
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- | - | - | (37,781 | ) | (37,781 | ) | |||||||||||||
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Balance, December 31, 2009
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2,168,000 | 2,168 | 241,032 | (369,277 | ) | (126,077 | ) | |||||||||||||
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Net loss
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- | - | - | (6,390 | ) | (6,390 | ) | |||||||||||||
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Balance, March 31, 2010 (Unaudited)
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2,168,000 | $ | 2,168 | $ | 241,032 | $ | (375,667 | ) | $ | (132,467 | ) | |||||||||
See Notes to Financial Statements.
6
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
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For the Three
Months Ended
March 31, 2010
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For the Three
Months Ended
March 31, 2009
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For the Period from Inception
(June 25, 2004) through
March 31, 2010
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Cash flows from operating activities
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Net loss
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$ | (6,390 | ) | $ | (825 | ) | $ | (375,667 | ) | |||
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Adjustments to reconcile net loss to net cash used in operating activities
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Changes in operating assets and liabilities
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Increase (decrease) in accounts payable
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97 | (574 | ) | 2,208 | ||||||||
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Increase in related party payables
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6,000 | - | 130,352 | |||||||||
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Net cash used in operating activities
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(293 | ) | (1,399 | ) | (243,107 | ) | ||||||
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Cash flows from investing activities
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||||||||||||
| - | - | - | ||||||||||
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Net cash used by investing activities
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- | - | - | |||||||||
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Cash flows from financing activities
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||||||||||||
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Proceeds from issuance of common stock
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- | - | 243,200 | |||||||||
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Net cash provided by financing activities
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- | - | 243,200 | |||||||||
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Net increase in cash
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(293 | ) | (1,399 | ) | 93 | |||||||
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Cash, beginning of period
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386 | 1,902 | - | |||||||||
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Cash, end of period
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$ | 93 | $ | 503 | $ | 93 | ||||||
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Supplemental disclosure of cash flow
information
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Income taxes paid
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$ | - | $ | - | $ | - | ||||||
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Interest paid
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$ | - | $ | - | $ | - | ||||||
See Notes to Financial Statements
7
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2010 AND 2009
(Unaudited)
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1.
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NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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Nature of Operations
Swinging Pig Productions, Inc. (the Company) is currently a development stage company under the provisions of the FASB Accounting Standards Codification (ASC) No. 915, “Development Stage Entities”, and was incorporated under the laws of the State of Florida on June 25, 2004. Since inception, the Company has produced minimal revenues and will continue to report as a development stage company until significant revenues are produced.
The Company is in the business of developing independent feature film motion pictures.
On August 11, 2004, the Company formed Chronicles of a Skater Girl, LLC in Florida, for the purpose of producing the Company first independent feature film. The Company owns 100% of Chronicles of a Skater Girl, LLC.
The Company has evaluated subsequent events through May 23, 2010, the date these financial statements were issued.
Principles of Consolidation
The consolidated financial statements include the accounts of Swinging Pig Productions, Inc. and it’s wholly owned subsidiary, Chronicles of a Skater Girl, LLC. All inter-company accounts and transactions have been eliminated in consolidation.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make 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 reported periods. Actual results could materially differ from those estimates.
Cash and Cash Equivalents
For purposes of the balance sheet and statement of cash flows, the Company considers all highly liquid debt instruments purchased with maturity of three months or less to be cash equivalents.
8
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2010 AND 2009
(Unaudited)
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1.
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NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
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Revenue Recognition
Revenue is to be recognized, in accordance with ASC No. 926-605-25, “Entertainment – Films, Revenue Recognition”, from a sale or licensing arrangement of a film when (a) persuasive evidence of a sale or licensing arrangement with a customer exists, (b) the film is complete and has been delivered or is available for immediate delivery, (c) the license period has begun and the customer can begin its exhibition or sale, (d) fee is fixed or determinable, and (e) collection of the fee is reasonably assured.
Income Taxes
The Company accounts for income taxes under ASC No. 740, “Accounting for Income Taxes”. Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and 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. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.
Comprehensive Income
The Company applies ASC No. 220, “Comprehensive Income” (ASC 220). ASC 220 establishes standards for the reporting and display of comprehensive income or loss, requiring its components to be reported in a financial statement that is displayed with the same prominence as other financial statements. From inception (June 25, 2004) through March 31, 2010, the Company had no other components of comprehensive loss other than net loss as reported on the statement of operations.
9
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2010 AND 2009
(Unaudited)
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1.
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NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
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Basic and Diluted Income (Loss) Per Share
In accordance with ASC No. 260, “Earnings Per Share”, basic income (loss) per common share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding. Diluted income (loss) per common share is computed similar to basic income per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. As of December 31, 2009, the Company did not have any equity or debt instruments outstanding that could be converted into common stock.
Recent Accounting Pronouncements
In June 2009, the Financial Accounting Standards Board (FASB) issued ASC Statement No. 105, the FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles (ASC 105). ASC 105 will become the single source authoritative nongovernmental U.S. generally accepted accounting principles (GAAP), superseding existing FASB, American Institute of Certified Public Accountants, Emerging Issues Task Force, and related accounting literature. ASC 105 reorganized the thousands of GAAP pronouncements into roughly 90 accounting topics and displays them using a consistent structure. Also included is relevant SEC guidance organized using the same topical structure in separate sections. The Company adopted ASC 105 on July 1, 2009. The adoption of ASC 105 did not have an impact on the Company’s financial position or results of operations.
On April 1, 2009, the Company adopted ASC 825-10-65, Financial Instruments – Overall – Transition and Open Effective Date Information (ASC 825-10-65). ASC 825-10-65 amends ASC 825-10 to require disclosures about fair value of financial instruments in interim financial statements as well as in annual financial statements and also amends ASC 270-10 to require those disclosures in all interim financial statements. The adoption of ASC 825-10-65 did not have a material impact on the Company’s results of operations or financial condition.
10
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2010 AND 2009
(Unaudited)
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1.
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NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
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Recent Accounting Pronouncements (continued)
On April 1, 2009, the Company adopted ASC 855, Subsequent Events (ASC 855). ASC 855 establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. It requires the disclosure of the date through which an entity has evaluated subsequent events and the basis for that date – that is, whether that date represents the date the financial statements were issued or were available to be issued. This disclosure should alert all users of financial statements that an entity has not evaluated subsequent events after that date in the set of financial statements being presented. The adoption of ASC 855 did not have a material impact on the Company’s results of operations or financial condition.
On July 1, 2009, the Company adopted ASU No. 2009-05, Fair Value Measurements and Disclosures (Topic 820) (ASU 2009-05). ASU 2009-05 provided amendments to ASC 820-10, Fair Value Measurements and Disclosures – Overall, for the fair value measurement of liabilities. ASU 2009-05 provides clarification that in circumstances in which a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using certain techniques. ASU 2009-05 also clarifies that when estimating the fair value of a liability, a reporting entity is not required to include a separate input or adjustment to other inputs relating to the existence of a restriction that prevents the transfer of a liability. ASU 2009-05 also clarifies that both a quoted price in an active market for the identical liability at the measurement date and the quoted price for the identical liability when traded as an asset in an active market when no adjustments to the quoted price of the asset are required are Level 1 fair value measurements. The adoption of ASU 2009-05 did not have a material impact on the Company’s results of operations or financial condition.
In October 2009, the FASB issued ASU 2009-13, Multiple-Deliverable Revenue Arrangements, (amendments to ASC 605, Revenue Recognition) (ASU 2009-13). ASU 2009-13 requires entities to allocate revenue in an arrangement using estimated selling prices of the delivered goods and services based on a selling price hierarchy. The amendments eliminate the residual method of revenue allocation and require revenue to be allocated using the relative selling price method. ASU 2009-13 should be applied on a prospective basis for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010, with early adoption permitted.
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SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2010 AND 2009
(Unaudited)
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1.
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NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
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Recent Accounting Pronouncements (continued)
The Company does not expect adoption of ASU 2009-13 to have a material impact on the Company’s results of operations or financial condition.
2. GOING CONCERN
As shown in the accompanying financial statements, the Company has incurred a net operating loss of $(375,667) from inception (June 25, 2004) through March 31, 2010. The Company is subject to those risks associated with development stage companies. The Company has sustained losses since inception and additional debt and equity financing will be required by the Company to fund its development activities and to support operations. However, there is no assurance that the Company will be able to obtain additional financing. Furthermore, there is no assurance that professional service contracts with actors, changing customer needs and evolving industry standards will enable the Company to introduce new films on a continual and timely basis so that profitable operations can be attained.
3. FAIR VALUE MEASUREMENTS
On January 1, 2008, the Company adopted FASB Accounting Standards Codification No. 820 (ASC 820), Fair Value Measurements. ASC 820 relates to financial assets and financial liabilities.
Fair Value of Financial Instruments
Pursuant to ASC No. 825, “Financial Instruments”, the Company is required to estimate the fair value of all financial instruments included on its balance sheet. The carrying value of cash, accounts payable and accrued expenses and related party payables approximate their fair value due to the short period to maturity of these instruments.
Determination of Fair Value
At March 31, 2010, the Company calculated the fair value of its assets and liabilities for disclosure purposes only.
12
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2010 AND 2009
(Unaudited)
3. FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)
Fair Value Measurements (continued)
Valuation Hierarchy
ASC 820 establishes a three-level valuation hierarchy for the use of fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date:
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•
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Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
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•
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Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.
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•
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Level 3 - Inputs that are both significant to the fair value measurement and unobservable. These inputs rely on management's own assumptions about the assumptions that market participants would use in pricing the asset or liability. (The unobservable inputs are developed based on the best information available in the circumstances and may include the Company's own data.)
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4. ACCRUED EXPENSES
Accrued Wages and Compensated Absences
The Company currently does not have any employees. The majority of development costs and services have been provided to the Company by the founders and outside, third-party vendors. As such, there is no accrual for wages or compensated absences as of March 31, 2010.
13
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2010 AND 2009
(Unaudited)
5. RELATED PARTY PAYABLES AND TRANSACTIONS
The Company periodically receives advances from a stockholder when necessary to be used for working capital purposes. These advances are non-interest bearing, due on demand and are to be repaid as cash becomes available. The amount due to the stockholder at March 31, 2010 was $11,152.
The Company is provided with office space and management services by a stockholder through his wholly owned company, an affiliate. Management fees paid or accrued for the three months ended March 31, 2010 were $6,000. The amount due to the related party at March 31, 2010 was $119,200.
6. COMMON STOCK
On June 26, 2004, the Company issued 1,200,000 shares of its common stock to its officers for services in the amount of $1,200 which was considered a reasonable estimate of fair value at that date.
On October 5, 2004, the Company issued 894,000 shares of its common stock to unrelated investors for cash of $223,500 pursuant to the Company’s unregistered private offering under Rule 506 of Regulation D of the Securities Act of 1933, as amended.
On March 11, 2005, the Company issued 74,000 shares of its common stock to unrelated investors for cash of $18,500 pursuant to the Company’s unregistered private offering under Rule 506 of Regulation D of the Securities Act of 1933, as amended.
7. PROVISION FOR INCOME TAXES
As of March 31, 2010, the Company had federal net operating loss carryforwards of approximately $(375,667), which can be used to offset future federal income tax. The federal and state net operating loss carryforwards expire at various dates through 2029. Deferred tax assets resulting from the net operating losses are reduced by a valuation allowance, when, in the opinion of management, utilization is not reasonably assured.
Deferred income taxes are reported using the liability method. Deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases.
14
SWINGING PIG PRODUCTIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2010 AND 2009
(Unaudited)
7. PROVISION FOR INCOME TAXES (Continued)
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
A summary of the Company’s deferred tax assets as of March 31, 2010 and December 31, 2009 are as follows:
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2010
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2009
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Federal net operating loss, at effective rate of 34%
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$
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127,700
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$
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125,500
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Less: valuation allowance
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(127,700
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)
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(125,500
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)
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|||||
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Net deferred tax asset
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$
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---
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$
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---
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|||||
The valuation allowance increased $2,200 for the three months ended March 31, 2010.
15
Item 2. Plan of Operation
This following information specifies certain forward-looking statements of management of the company. Forward-looking statements are statements that estimate the happening of future events and are not based on historical fact. Forward-looking statements may be identified by the use of forward-looking terminology, such as “may”, “shall”, “could”, “expect”, “estimate”, “anticipate”, “predict”, “probable”, “possible”, “should”, “continue”, or similar terms, variations of those terms or the negative of those terms. The forward-looking statements specified in the following information have been compiled by our management on the basis of assumptions made by management and considered by management to be reasonable. Our future operating results, however, are impossible to predict and no representation, guaranty, or warranty is to be inferred from those forward-looking statements.
The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry, and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements. We cannot guarantee that any of the assumptions relating to the forward-looking statements specified in the following information are accurate, and we assume no obligation to update any such forward-looking statements.
Critical Accounting Policy and Estimates. Our Management's Discussion and Analysis of Financial Condition and Results of Operations section discusses our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments, including those related to revenue recognition, accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The most significant accounting estimates inherent in the preparation of our financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources. These accounting policies are described at relevant sections in this discussion and analysis and in the notes to the consolidated financial statements included in our Annual Report as of December 31, 2009 filed on Form 10-K.
Our Business. Swinging Pig Productions, Inc. (“we” or the “Company), is a development stage Florida Corporation formed on June 25, 2004 to develop a low-budget film concept that appeals to a broad audience. Our corporate purpose is to develop, produce and market feature-length motion pictures. Our first production is tentatively titled “Chronicles of a Skater Girl,” (“Skater Girl”). Chronicles of a Skater Girl, LLC, is our wholly-owned subsidiary. From inception through the current date, our business operations have primarily been focused on developing Skater Girl. We conducted a private offering to raise funds to produce and distribute Skater Girl, and to finance our general corporate expenses. Otherwise, our operations have been funded by our management who also hold approximately 55% of our outstanding shares of common stock. We anticipate that our future revenues will be generated through both distribution and commercial licensing of Skater Girl’s distribution rights. We have not had any operating revenue from operations as we have not yet commercially marketed Skater Girl or any other production.
For the three months ended March 31, 2010, as compared to the three months ended March 31, 2009.
Results of Operations. As of March 31, 2010, we have not yet generated or realized any revenues and will not do so until and unless we complete Skater Girl and enter into a distribution agreement.
Revenues. We have no revenues and have only achieved losses since inception. For the period from our inception on June 25, 2004 to the period ended March 31, 2010, we generated no revenues from our operations. We will be unable to generate revenues until we are able to complete Skater Girl and then enter into a distribution agreement for Skater Girl.
Operating Expenses. For the three months ended March 31, 2010, our total expenses were $6,390, which were represented by $6,000 for management fees, $168 for general and administrative expenses and $222 for production expenses. Our loss from operations and net loss was also $6,390 for the three months ended March 31, 2010. This is in comparison to the three months ended March 31, 2009, where our total expenses were $825, which were represented by $603 for general and administrative expenses, and $222 for production expenses. Our loss from operations and net loss was also $825 for the three months ended March 31, 2009. We expect to incur considerable expenses as we continue to finish production of Skater Girl and seek a distribution agreement.
Liquidity and Capital Resources. As of March 31, 2010, we have $93 cash on hand and in our corporate bank accounts. We have total current liabilities of $132,560, which consists of accounts payable and accrued expenses of $2,208 and loans payable to shareholders of $130,352 as of March 31, 2010.
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To effectuate our business plan during the next twelve months, we complete Skater Girl and arrange for its distribution. Our estimated budget to complete post-production on Skater Girl is:
|
Steps required
|
Estimated
budget
|
|||
|
1) Selection of music for Skater Girl’s soundtrack
|
$
|
n/a
|
||
|
2) Licensing of selected music from recording artists and/or their record labels
|
3,000
|
|||
|
3) Sound design and folly editing for Skater Girl
|
$
|
1,500
|
||
|
4) Final sound mix including movie dialogue, soundtrack music, and folly sound
|
$
|
1,500
|
||
|
5) Color correction of Skater Girl
|
$
|
1,000
|
||
|
6) Mastering of the digital master
|
$
|
1,500
|
||
|
Total
|
$
|
8,500
|
||
Upon completion of Skater Girl, we anticipate that our next steps will be submitting to a select number of film festivals. The specific festivals which the movie will be submitted will be contingent on the combination of the following: the date we complete Skater Girl; which festivals and deadlines coincide with Skater Girl’s completion date; and which of these festivals are appropriate venues for Skater Girl to be seen. Simultaneously, we will market Skater Girl to DVD, television, and online distributors, as well as other ancillary channels of distribution in an effort to secure domestic and foreign distribution for Skater Girl.
We had cash of $93 as of March 31, 2010. We do not have adequate funds to satisfy our working capital requirements for the next twelve months to complete Skater Girl and market it for distribution. Our forecast for the period for which our financial resources will be inadequate to support our operations involves risks and uncertainties and actual results could fail as a result of a number of factors. We will need to raise additional capital to continue our operations. In the event that we experience a shortfall in our capital, which will occur if we are unable to increase our revenues we intend to pursue capital through public or private financing as well as borrowings and other sources, such as our officers and directors. We cannot guaranty that additional funding will be available on favorable terms, if at all. If adequate funds are not available, then our ability to continue our operations may be significantly hindered. If adequate funds are not available, we believe that our officers, directors and majority shareholders will contribute funds to pay for our expenses to achieve our objectives over the next twelve months. Our belief that our majority shareholders will pay our expenses is based on the fact that they own 1,200,000 shares of our common stock, which equals approximately 55.4% of our outstanding common stock. We believe that our majority shareholders will continue to pay our expenses as long as they maintain ownership of our common stock. Therefore, we have not contemplated any plan of liquidation in the event that we do not generate sufficient revenues to support our operations.
We do not anticipate conducting any such activities in the near future. In the event that we change the focus of our operations, then we may need to hire additional employees or independent contractors as well as purchase or lease additional equipment.
Because we have limited operations and assets, we may be considered a shell company as defined in Rule 12b-2 of the Securities Exchange Act of 1934. Accordingly, we have checked the box on the cover page of this report that specifies we are a shell company.
Off-Balance Sheet Arrangements. There are no off balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
Not applicable.
Item 4. Controls and Procedures
Evaluation of disclosure controls and procedures. The Company, under the supervision and with the participation of its management, including the Chief Executive Officer and the Chief Financial Officer, evaluated the effectiveness of the design and operation of the Company’s “disclosure controls and procedures” (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended), as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of March 31, 2010.
Changes in internal controls over financial reporting: There was no change in our internal controls over financial reporting that occurred during the period covered by this report, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.
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PART II — OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 1A. Risk Factors.
Not applicable.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits
31.1 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2. Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32.1
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
32.2
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
18
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Swinging Pig Productions, Inc.
a Florida corporation
|
/s/ Michael Davis
|
May 24, 2010
|
|||
|
Michael Davis
Principal Executive Officer,
President and a Director
|
|
/s/ Daniel Mirman
|
May 24, 2010
|
|||
|
Daniel Mirman
Principal Financial Officer, Treasurer,
Secretary and a Director
|