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EX-32 - SECTION 1350 CERTIFICATION - Rx Technologies Corp.ex_32-1.htm
EX-31 - RULE 13A-14(A)/15D-14(A) CERTIFICATION - Rx Technologies Corp.ex_31-2.htm
EX-32 - SECTION 1350 CERTIFICATION - Rx Technologies Corp.ex_32-2.htm
EX-31 - RULE 13A-14(A)/15D-14(A) CERTIFICATION - Rx Technologies Corp.ex_31-1.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-Q


þ

 

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


For the quarterly period ended March 31, 2011


OR


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 333-156942

 

Rx Technologies Corp.

(Exact name of registrant as specified in its charter)


Florida

 

26-3891952

(State or other jurisdiction of incorporation or organization)

  

(I.R.S. Employer Identification Number)


7076 Spyglass Avenue, Parkland, FL

 

33076

(Address of principal executive offices)

  

(Zip Code)


(954) 599-3672

(Issuer’s telephone number, including area code)


Not Applicable

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


Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes þ     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 o     No þ


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


           Large accelerated filer        o                                                                             Accelerated filer                             o

           Non-accelerated filer          o                                                                             Smaller reporting company           x

(Do not check if a smaller reporting company)


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


Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.


Class

  

Outstanding at April 25, 2011

Common Stock, $0.001

  

64,321,850 shares




RX TECHNOLOGIES CORP.

 

TABLE OF CONTENTS


 

PAGE

 

 

Part I Financial Information

3

 

 

Item 1. Financial Statements

3

 

 

Condensed Balance Sheets at March 31, 2011 (unaudited) and December 31, 2010 (audited)

3

 

 

Condensed Statements of Operations for the three months ended March 31, 2011 and

     the cumulative period from November 15, 2008 (inception) through March 31, 2011

4

 

 

Condensed Statements of Cash Flows at March 31, 2011

5

 

 

Notes to Condensed Financial Statements

6

 

 

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

12

 

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

15

 

 

Item 4T. Controls and Procedures.

15

 

 

Part II Other Information

16

 

 

Item 1. Legal Proceeding.

16

 

 

Item 1A. Risk Factors.

16

 

 

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

16

 

 

Item 3. Defaults Upon Senior Securities.

16

 

 

Item 4. (Removed and Reserved).

16

 

 

Item 5. Other Information.

16

 

 

Item 6. Exhibits.

16

 

 

Signatures

16


2



PART I FINANCIAL INFORMATION


Item 1.  Financial Statements


RX TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEETS


ASSETS

 

 

March 31, 2011

 

December 31, 2010

 

 

 

(unaudited)

 

(audited)

 

CURRENT ASSETS:

 

 

 

 

 

 

 

Cash and equivalents

 

$

 

$

 

Inventory

 

 

 

 

 

Total Current Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER ASSETS:

 

 

 

 

 

 

 

Intellectual Property

 

 

 

 

 

 

 

Gift Card Digest Website, net

 

 

 

 

1,834

 

RxTC Solutions

 

 

37,222

 

 

37,222

 

Medipayments

 

 

25,000

 

 

 

Total Other Assets

 

 

62,222

 

 

39,056

 

Total Assets

 

$

62,222

 

$

39,056

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

 

 

Accounts Payable

 

 

 

 

 

Accrued Expenses

 

 

5,900

 

 

7,400

 

Advances from Related Parties

 

 

1,500

 

 

 

Total Current Liabilities

 

 

7,400

 

 

7,400

 

Long-term Liabilities

 

 

 

 

 

 

 

Total Long-term Liabilities

 

 

 

 

 

Total Liabilities

 

 

7,400

 

 

7,400

 

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY/(DEFICIT):

 

 

 

 

 

 

 

Preferred Stock, par value $.001; 10,000,000 shares authorized;
0 issued and outstanding at March 31, 2011 and December 31, 2010

 

 

 

 

 

Common stock, par value $.001; 500,000,000 shares authorized;
64,321,850 shares issued and outstanding at March 31, 2011
55,821,850 shares issued and outstanding at December 31, 2010;

 

 

64,322

 

 

55,822

 

Additional paid in capital

 

 

77,400

 

 

43,400

 

Deficit accumulated during the development stage

 

 

(86,900

)

 

(67,566

)

Total Stockholders' Equity

 

 

54,822

 

 

31,656

 

 

 

 

 

 

 

 

 

Total Liabilites and Stockholder's Equity (Deficit)

 

$

62,222

 

$

39,056

 


The accompanying notes are an integral part of these statements.


3



RX TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF OPERATIONS


 

 

 

 

 

 

 

 

Cumulative from

 

 

 

For the three

 

For the three

 

November 15, 2008

 

 

 

months ended

 

months ended

 

(Inception) through

 

 

 

March 31, 2011

 

March 31, 2010

 

March 31, 2011

 

 

 

 

 

 

 

 

 

 

 

 

Net Sales

 

$

 

$

 

$

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Profit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

General & Administrative

 

 

1,500

 

 

500

 

 

12,275

 

Legal and Accounting

 

 

1,000

 

 

1,500

 

 

26,625

 

Fees to Directors

 

 

 

 

 

 

15,000

 

Consulting, Marketing and Advertising

 

 

15,000

 

 

 

 

27,000

 

Amortization

 

 

1,834

 

 

500

 

 

6,000

 

 

 

 

 

 

 

 

 

 

 

 

Total Expenses

 

 

19,334

 

 

2,500

 

 

86,900

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) before Income Taxes

 

 

(19,334

)

 

(2,500

)

 

(86,900

)

 

 

 

 

 

 

 

 

 

 

 

Provision for Income Taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss)

 

$

(19,334

)

$

(2,500

)

$

(86,900

)

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net loss per common share

 

 

**

 

 

**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding

 

59,260,438

 

 

10,000,000

 

 

 

 


** Less than $0.01 per share


The accompanying notes are an integral part of these statements.


4



RX TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

CONDENSED STATEMENTS OF CASH FLOWS

For the Period November 15, 2008 (inception) through March 31, 2011


 

 

 

 

 

 

 

 

Cumulative from

 

 

 

For the three

 

For the three

 

November 15, 2008

 

 

 

months ended

 

months ended

 

(Inception) through

 

 

 

March 31, 2011

 

March 31, 2010

 

March 31, 2011

 

OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

 (19,334

)

$

 (2,500

)

$

 (86,900

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

 

 

Increase in amortization

 

 

1,834

 

 

500

 

 

6,000

 

Stock issued for services

 

 

10,000

 

 

 

 

35,000

 

Conversion of shareholder loan to equity

 

 

7,500

 

 

 

 

7,500

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

Acquisition of intellectual property

 

 

 

 

 

 

(6,000

)

Increase/(Decrease) in accounts payable and accrued expenses

 

 

(1,500

)

 

(500

)

 

7,400

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in operating activities

 

 

(1,500

)

 

(2,500

)

 

(37,000

)

 

 

 

 

 

 

 

 

 

 

 

FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

 

 

Increase in due to related parties

 

 

1,500

 

 

2,500

 

 

24,000

 

Increase in notes payable

 

 

 

 

 

 

(6,000

)

Proceeds from issuance of common stock

 

 

 

 

 

 

19,000

 

 

 

 

 

 

 

 

 

 

 

 

Net cash provided by (used in) financing activities

 

 

1,500

 

 

2,500

 

 

37,000

 

 

 

 

 

 

 

 

 

 

 

 

NET INCREASE (DECREASE) IN CASH

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CASH BEGINNING BALANCE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CASH ENDING BALANCE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

 

 

 

 

 

 

 

 

 

 

Taxes paid

 

$

 

$

 

$

 

Interest paid

 

$

 

$

 

$

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NON-CASH TRANSACTIONS AFFECTING OPERATING, INVESTING AND FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

 

 

Issuance of common stock for acquisition of intellectual property

 

$

25,000

 

$

 

 

 

 

Issuance of notes payable for acquisition of intellectual property

 

$

 

$

 

 

 

 


The accompanying notes are an integral part of these statements.


5



RX TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2011


NOTE 1 - BASIS OF PRESENTATION


The accompanying unaudited interim financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission for the presentation of interim financial information, but do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements.  The audited financial statements for the period November 15, 2008 (Inception) through December 31, 2010 and the year ended December 31, 2009 were filed on February 24, 2011 with the Securities and Exchange Commission and are hereby referenced.  In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included.  Operating results for the three months ended March 31, 2011 and for the period November 15, 2008 (Inception) through March 31, 2011 are not necessarily indicative of the results that may be expected for the year ended December 31, 2011.


NOTE 2 - DESCRIPTION OF BUSINESS AND DEVELOPMENT STAGE RISK


Description of Business


RX TECHNOLOGIES CORP. (“THE COMPANY”) is a development stage company, incorporated in the State of Florida on November 15, 2008. The company is focusing in the development of two (2) databases, at March 31, 2011, as follows:


RxTC  Database


The RxTC database is for prescription drug databases. The RxTC Solutions is a secure, easy-to-use and minimum cost service for confronting prescription drug abuse and diversion.  The RxTC solution is a comprehensive secure validation, monitoring and reporting procedure integrated with a visual identification verification system.  The process immediately prevents “doctor shopping,” individuals going to more than one physician at a time to obtain prescription drugs.  By deploying the RxTC solution, patient’s identities can be verified and validated.  Physicians and pharmacists will immediately have live, real-time data available for scrutiny and could receive important alerts and valid dispensing histories.  Secondary verification at the point of dispensing could further eliminate the potential for fraud and other more serious crimes.


Medipayment Database


The Medipayment process includes a system whereby merchants that utilize the process have additional identifying features of the consumer to enhance correct identification on presentation and process of the facility. Additionally, Medipayments is developing vending dispensaries and tech messaging services in the related fields of technology.


We commenced our initial public offering on May 21, 2009, pursuant to that certain Registration Statement on Form S-1 (Commission File No. 333-156942), which was  declared effective by the Securities and Exchange Commission on that date.  We registered 3,000,000 shares of Common Stock for sale by the Company for an aggregate offering price of $30,000.  We sold 1,000,000 shares of Common Stock in the offering. The offering provided proceeds to us in the amount of $10,000.


On April 28, 2010, we filed Amended and Restated Articles of Incorporation with the Secretary of State of Florida which:


 

·

changed the name of the corporation to Rx Technologies Corp.,

 

 

 

 

·

increased the number of authorized shares of common stock from 100,000,000 shares to 500,000,000 shares and fixed a par value of $0.001 per share,

 

 

 

 

·

authorized a class of 10,000,000 shares of blank check preferred stock, par value $0.001 per share, and

 

 

 

 

·

included indemnification provisions customary under Florida law, as well as election not to be governed by the provisions of the Florida Business Corporation Act governing affiliated transactions and an election to be governed by the provisions related to control share acquisitions.


6



RX TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2011


On April 30, 2010, we entered into an Intellectual Property Agreement with Mr. Evan Brovenick, the developer and owner of the RxTC database processes for prescription drug databases. Pursuant to this agreement, the Company acquired solely the intellectual property and related rights. The total consideration for the intellectual property purchased was the issuance of 37,221,850 common shares of our company. The issued common shares were allocated, in part, to certain other associates involved with facilitating the development of the intellectual property as defined in the Intellectual Property Agreement.


On February 25, 2011, we entered into an Intellectual Property Agreement with Medipayments, Inc., the developer and owner of the Medipayment’s process for merchant services including trade secrets and intellectual property rights.  The Medipayment process includes a system whereby merchants that utilize the process have additional identifying features of the consumer to enhance correct identification on presentation and process of the facility. Additionally, Medipayments is developing vending dispensaries and tech messaging services in the related fields of technology.


As of March 31, 2011, we had an accumulated deficit of ($86,900).  Our auditors have raised substantial doubt as to our ability to continue as a going concern.  Our ability to continue as a going concern is dependent upon our ability to generate profitable operations in the future and/or to obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due.  There can be no assurance that we will operate at a profit or such additional financing will be available, or if available, can be obtained on satisfactory terms.


Our principal executive office is located at 7076 Spyglass Avenue, Parkland, FL  33076.  Our telephone number is (954) 599-3672.  Our fiscal year ends on December 31.


Basis of Presentation


The accompanying condensed financial statements have been prepared by the Company. The Company’s financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).


Going Concern


The Company’s financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable.  If the Company is unable to obtain adequate capital, it could be forced to cease operations.  The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.


Management’s Plan to Continue as a Going Concern


The Company has met its historical working capital requirements from the sale of its capital shares and loans from officers, directors and stockholders.  In order to continue as a going concern, the Company will need, among other things, additional capital resources. 


Management’s plans to obtain such resources for the Company include obtaining capital from the sale of shares of common stock of the Company and/or financing from independent third parties. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.


Development Stage Risk


Since its inception, the Company has been dependent upon the receipt of capital investment to fund its continuing activities. In addition to the normal risks associated with a new business venture, there can be no assurance that the Company's business plan will be successfully executed. Our ability to execute our business plan will depend on our ability to obtain additional financing and achieve a profitable level of operations. There can be no assurance that sufficient financing will be obtained.  Further, we cannot give any assurance that we will generate substantial revenues or that our business operations will prove to be profitable.


7



RX TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2011


NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Cash and Cash Equivalents


The Company considers all highly liquid debt instruments with original maturities of three months or less to be cash equivalents. The Company has no cash equivalents.


Use of Estimates


The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.


Inventories


Inventories are valued at the lower of cost or market on a first-in, first-out (FIFO) basis, and include finished goods. Inventories consist of various gift cards having various denominations at cost.


Intellectual Properties


The company accounts for its two (2) primary intellectual properties at lower cost to market value and amortize over the useful life of the asset. The company’s two (2) primary intellectual properties are under development and have not been placed in service at March 31, 2011.


The Company evaluates the recoverability of identifiable intangible assets whenever events or changes in circumstances indicate that an intangible asset's carrying amount may not be recoverable. There was an impairment for the period ended March 31, 2011 of $1,834 as the company determined the intangible asset was not recoverable.


Revenue Recognition


The Company recognizes revenue when:


 

·

Persuasive evidence of an arrangement exists;

 

·

Shipment has occurred;

 

·

Price is fixed or determinable; and

 

·

Collectability is reasonably assured.


The Company closely follows the provisions of Accounting Standards Codification (“ASC”) 605, Revenue Recognition, which includes the guidelines of Staff Accounting Bulletin No. 104 as described above. For the period from November 15, 2008 (inception) to March 31, 2011, the Company recognized no revenues.


Earnings (Loss) Per Share


The Company computes earnings per share in accordance with ASC 260 “Earnings per Share” which was previously Statement of Accounting Standards No. 128, “Earnings per Share” (“SFAS No. 128”). Under the provisions of SFAS No. 128, basic earnings per share is computed by dividing the net income (loss) for the period by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing the net income (loss) for the period by the weighted average number of common and potentially dilutive common shares outstanding during the period.  There were no potentially dilutive common shares outstanding during the period.


8



RX TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2011


Income Taxes


The Company accounts for income taxes in accordance with ASC 740, Income Taxes, which was previously Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes.” Under the asset and liability method of Statement 109, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.


Fair Value of Financial Instruments


The Company considers that the carrying amount of financial instruments, including accounts payable, approximates fair value because of the short maturity of these instruments.


Share Based Payments

(included in ASC 718 “Compensation-Stock Compensation”)


In December 2004, the FASB issued SFAS No. 123(R), “Share-Based Payment,” which replaces SFAS No. 123 and supersedes APB Opinion No. 25. Under SFAS No. 123(R), companies are required to measure the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs in the financial statements over the period during which employees or independent contractors are required to provide services. Share-based compensation arrangements include stock options and warrants, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans. In March 2005, the SEC issued Staff Accounting Bulletin No. 107, or “SAB 107”. SAB 107 expresses views of the staff regarding the interaction between SFAS No. 123(R) and certain SEC rules and regulations and provides the staff's views regarding the valuation of share-based payment arrangements for public companies. SFAS No. 123(R) permits public companies to adopt its requirements using one of two methods. On April 14, 2005, the SEC adopted a new rule amending the compliance dates for SFAS 123(R). Companies may elect to apply this statement either prospectively, or on a modified version of retrospective application under which financial statements for prior periods are adjusted on a basis consistent with the pro forma disclosures required for those periods under SFAS 123.


Effective commencing on the year ended December 31, 2008; the Company has fully adopted the provisions of SFAS No. 123(R) and related interpretations as provided by SAB 107. As such, compensation cost is measured on the date of grant as the fair value of the share-based payments. Such compensation amounts, if any, are amortized over the respective vesting periods of the option grant.


Recent Accounting Pronouncements


The company has adopted all recently issued accounting pronouncements.  The adoption of the accounting pronouncements, including those not yet effective, is not anticipated to have a material effect on the financial position or results of operations of the Company.


Subsequent Events


We evaluated subsequent events through the date and time our financial statements were available on April 30, 2011.


NOTE 4 - EQUITY TRANSACTIONS


On November 15, 2008, the Company issued 9,000,000 shares of common stock to Tammi Shnider, the sole officer and director on that date for $9,000 at $0.001.


On October 18, 2009, the Company issued 1,000,000 shares of common stock to 39 investors in accordance with Form S-1 (commission file #333-156942) for cash and consideration of $10,000.


9



RX TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2011


On April 28, 2010, we filed Amended and Restated Articles of Incorporation with the Secretary of State of Florida which:


 

·

changed the name of the corporation to Rx Technologies Corp.,

 

 

 

 

·

increased the number of authorized shares of common stock from 100,000,000 shares to 500,000,000 shares and fixed a par value of $0.001 per share,

 

 

 

 

·

authorized a class of 10,000,000 shares of blank check preferred stock, par value $0.001 per share.


On April 30, 2010, we entered into an Intellectual Property Agreement with the inventor, developer and owner of the RxTC database processes for prescription drug databases and issued 37,221,850 common shares of our company. The issued common shares were allocated, in part, to certain other associates involved with facilitating the development of the intellectual property as defined in the Intellectual Property Agreement.


On December 15, 2010, the Company issued a total of 8,600,000 common shares to directors (3,000,000 shares), payment of obligation to related party (3,600,000 shares) and payment to consultants (2,000,000 shares).


On February 25, 2011, we acquired the Intellectual Property Agreement with Medipayments, Inc., the developer and owner of the Medipayments processes for merchant services and issued 5,000,000 common shares as defined in the Intellectual Property Agreement. Additionally, we issued 2,000,000 common shares to consultants of the Medipayments, Inc. transaction.


On March 31, 2011, the Company issued 1,500,000 shares of common stock to Steven Adelstein, for payment of loans from related parties and authorized the issuance of additional 4,000,000 common shares pursuant to a private placement memorandum.


The company has no outstanding options and warrants.


NOTE 5 - CONCENTRATION OF CREDIT RISK


Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash deposits. Accounts at each institution are insured by the Federal Deposit Insurance Corporation (“FDIC”). At March 31, 2011, the Company had no amounts in excess of the FDIC insured limit.


NOTE 6 - RELATED PARTY TRANSACTIONS


From time to time, the company borrows from its officers, directors and stockholders. At March 31, 2011, the company owed $1,500 to Steven Adelstein, the father of Tammi Shnider and present stockholder and at December 31, 2010, the company owed $0. There are no signed or executed agreements between the parties and the company and therefore there are no assurances that said related parties will advance funds in the future.


The Company does not lease or rent any property. Office space and services are provided without charge by Steven Adelstein, stockholder, our sole officer and director. Such costs are immaterial to the financial statements and, accordingly, have not been reflected therein.


The officers and directors of the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interests. The Company has not formulated a policy for the resolution of such conflicts.


On December 15, 2010, the officers and directors received compensation of $15,000 with the issuance of 3,000,000 common shares. For the period ended March 31, 2011, no compensation, including issuance of common shares, was authorized by the board of directors.


10



RX TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2011


NOTE 7 - INTELLECTUAL PROPERTY


The Company has capitalized costs in acquiring intellectual properties which consisted of the following at March 31, 2011:


 

March 31, 2011

 

 

 

 

 

Web site costs (www.giftcarddigest.com)

$

6,000

 

Accumulated Amortization

 

(6,000

)

Web site costs, Net

 

0

 

Intellectual Property – RxTC Database

 

37,222

 

                                     – Medipayments Database

 

25,000

 

Total

$

62,222

 


The Company begins amortizing intellectual property costs, using the straight-line method over the estimated useful life of 3 years, once it was put into service. At March 31, 2011, RxTC and Medipayment Databases were not put in service and therefore amortization has not commenced.


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


The following discussion and analysis should be read in conjunction with our consolidated financial statements, including the notes thereto, appearing in this Form 10-Q and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2010 filed on February 24, 2011 with the Securities and Exchange Commission and are hereby referenced.


The statements in this report include forward-looking statements.  These forward-looking statements are based on our management’s current expectations and beliefs and involve numerous risks and uncertainties that could cause actual results to differ materially from expectations.  You should not rely upon these forward-looking statements as predictions of future events because we cannot assure you that the events or circumstances reflected in these statements will be achieved or will occur.  You can identify a forward-looking statement by the use of the forward-terminology, including words such as “may”, “will”, “believes”, “anticipates”, “estimates”, “expects”, “continues”, “should”, “seeks”, “intends”, “plans”, and/or words of similar import, or the negative of these words and phrases or other variations of these words and phrases or comparable terminology.  These forward-looking statements relate to, among other things: our sales, results of operations and anticipated cash flows; capital expenditures; depreciation and amortization expenses; sales, general and administrative expenses; our ability to maintain and develop relationship with our existing and potential future customers;  and, our ability to maintain a level of investment that is required to remain competitive.  Many factors could cause our actual results to differ materially from those projected in these forward-looking statements, including, but not limited to: variability of our revenues and financial performance; risks associated with technological changes; the acceptance of our products in the marketplace by existing and potential customers; disruption of operations or increases in expenses due to our involvement with litigation or caused by civil or political unrest or other catastrophic events; general economic conditions, government mandates and conditions in the gaming/entertainment industry in particular; and, the continued employment of our key personnel and other risks associated with competition.


For a discussion of the factors that could cause actual results to differ materially from the forward-looking statements see the “Liquidity and Capital Resources” section under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this item of this report and the other risks and uncertainties that are set forth elsewhere in this report or detailed in our other Securities and Exchange Commission reports and filings.  We believe it is important to communicate our expectations. However, our management disclaims any obligation to update any forward-looking statements whether as a result of new information, future events or otherwise.


Overview


Rx Technologies Corp. (“The Company”) is a development stage company, incorporated in the State of Florida on November 15, 2008. The company is currently concentrating on and developing in two (2) primary areas as follows:


1.    RxTC Database Processes


The RxTC database (once developed, beta tested and completed) is for prescription drug databases. The RxTC Solution is a secure, easy-to-use and minimum cost service for confronting prescription drug abuse and diversion. The RxTC Solution is a comprehensive secure validation, monitoring and reporting procedure integrated with a visual identification verification system. The process immediately prevents “doctor shopping,” individuals going to more than one physician at a time to obtain prescription drugs. By deploying the RxTC Solution, patient's identities can be verified and validated. Physicians and pharmacists will immediately have live, real-time data available for scrutiny and could receive important alerts and valid dispensing histories. Secondary verification at the point of dispensing could further eliminate the potential for fraud and other more serious crimes.


2.   Medipayments


The Medipayment system (once developed, beta tested and completed) is for payment for prescription drugs and other payments that are required as settlement via a debit card. The Medipayments card will include a back office solution that the consumer can utilize to review payment as made. Additionally, the card shall include data that the merchant can utilize to validate prescription issuance and authorization while maintaining the requirements of both state and federal regulators.


Going Concern


Our financial statements have been prepared on the basis of accounting principles applicable to a going concern. As a result, they do not include adjustments that would be necessary if we were unable to continue as a going concern and would therefore be obligated to realize assets and discharge our liabilities other than in the normal course of operations.  As reflected in the accompanying financial statements, the Company is in the development stage with no revenues, has used cash flows in operations of $(37,000) from inception of November 15, 2008 to March 31, 2011 and has an accumulated deficit of ($86,900) through March 31, 2011.


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This raises substantial doubt about our ability to continue as a going concern, as expressed by our auditors in its opinion on our financial statements included in this report. The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan.


We have not yet established an ongoing source of revenues sufficient to cover our operating costs and allow us to continue as a going concern.  Our ability to continue as a going concern is dependent on us obtaining adequate capital to fund operating losses until we become profitable.  If we are unable to obtain adequate capital, we could be forced to cease operations.  There can be no assurance that we will operate at a profit or additional debt or equity financing will be available, or if available, can be obtained on satisfactory terms.


Critical Accounting Policies


Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis.  The preparation of financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures. On an on-going basis, management evaluates these estimates and assumptions, including but not limited to those related to revenue recognition and the impairment of long-lived assets, goodwill and other intangible assets. Management bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.


Stock Compensation

(included in ASC 718 “Compensation-Stock Compensation”)


The Company adopted SFAS No. 123R, Share-Based Payment (“SFAS 123R”), which requires all stock-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values. The Company accounts for stock-based compensation arrangements with nonemployees in accordance with the Emerging Issues Task Force Abstract No. 96-18, Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling Goods or Services. The Company records the expense of such services to employees and non employees based on the estimated fair value of the equity instrument using the Black-Scholes pricing model.


Revenue Recognition

(included in ASC 605 “Revenue Recognition”)


The Company recognizes revenue on arrangements in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 101, “Revenue Recognition in Financial Statements’ and No. 104, “Revenue Recognition”. In all cases, revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.


Product sales and shipping revenues, net of promotional discounts, rebates, and return allowances, are recorded when the products are shipped and title passes to customers. Retail sales to customers are made pursuant to a sales contract that provides for transfer of both title and risk of loss upon our delivery to the carrier. Return allowances, which reduce product revenue, are estimated using historical experience. Revenue from product sales and services rendered is recorded net of sales taxes. Amounts received in advance for subscription services, are deferred and recognized as revenue over the subscription term.


Outlook


The most important metric by which we judge the Company’s performance now and in the near term is top line sales growth. Our current commitment to develop and deliver quality products means that, for the near future, bottom line profitability will be a poor indicator of our success.


Since investors are certain to be the primary, near term source of liquidity to support our development and marketing efforts, our liquidity will be driven by our ability to attract repeat investments from current shareholders and to find new ones. This in turn may be materially impacted by the general investment climate.


Our primary marketing challenge for the coming 12 months is to achieve market awareness from and through independent distributors to market  our products including CDs, DVDs and web downloads (MP3 format) currently under development and anticipated to be completed for beta testing in the fourth quarter of 2011. Additionally, management is seeking new acquisitions to complement existing products.


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Revenues


These forward-looking statements, pertaining to revenues, are based on our management’s current expectations and beliefs and involve numerous risks and uncertainties that could cause actual results to differ materially from expectations.  You should not rely upon these forward-looking statements as predictions of future events because we cannot assure you that the events or circumstances reflected in these statements will be achieved or will occur.  As our revenues commence, we plan to invest in marketing and sales by increasing the number of direct sales throughout our web portal to build brand awareness. We expect that in the future, marketing and sales expenses will increase in absolute dollars commencing in the fourth quarter of 2011. We do not expect our revenues to increase significantly until fourth quarter of 2011.


General and Administrative Expenses


We expect that general and administrative expenses associated with executive compensation will increase in the future. Although our current president, chief financial officer and sole director have foregone full salary payments during the initial stages of the business, anticipated to commence revenues in the fourth quarter of 2011. In addition, we believe in the 2012 fiscal year that the compensation packages required to attract the senior executives the Company requires to execute against its business plan will increase our total general and administrative expenses.


Summary of Condensed Results of Operations


Any measurement and comparison of revenues and expenses from continuing operations should not be considered necessarily indicative or interpolated as the trend to forecast our future revenues and results of operations.


Results for the Three Months Ended March 31, 2011


Revenues. The Company’s revenues for the three months ended March 31, 2011 were $0. Additionally, the Company has not had any revenues from inception (November 15, 2008) to March 31, 2011.


Legal and Accounting Expenses. Legal and Accounting expenses for the three months ended March 31, 2011 were $1000. These legal and accounting expenses were a direct result of professional fees associated with the company’s filings required by the Securities and Exchange Commission.


General and Administrative Expenses. General and administrative expenses for the three months ended March 31, 2011 were $1,500.  These expenses are normal and reoccurring for our Company as a development stage entity.


Net Loss. Net loss for the three months ended March 31, 2011 was $19,334_.  The net loss was typical for a development stage company and is recurring in nature until such time as we become more active with the implementation of our business plan.


Impact of Inflation


We believe that the rate of inflation has had negligible effect on our operations.  We believe we can absorb most, if not all, increased non-controlled operating costs by increasing sales prices, whenever deemed necessary and by operating our Company in the most efficient manner possible.


Liquidity and Capital Resources


The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan. Since its inception, the Company has been funded by its related parties and equity sales.


As of March 31, 2011, total current assets were $62,222.


As of March 31, 2011, total current liabilities were $7,400, which consisted of $_5,900 of accrued expenses and $1,500of loans from related parties.  As of December 31, 2010, total current liabilities were $7,400, which consisted of $7,400 of accrued expenses.  We had net working capital deficit of $7,400 as of March 31, 2011 and December 31, 2010.


During the three months ended March 31, 2011, operating activities used cash of $1,500.


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Material Commitments


The Company does not have any material commitments as of March 31, 2011.


Off-Balance Sheet Arrangements


We do not have any off-balance sheet arrangements or any anticipate entering into any off-balance 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.


Recent Accounting Pronouncements


The company has adopted all recently issued accounting pronouncements.  The adoption of the accounting pronouncements, including those not yet effective, is not anticipated to have a material effect on the financial position or results of operations of the Company.


Item 3.  Quantitative and Qualitative Disclosures About Market Risk


We are not subject to risks related to foreign currency exchange rate fluctuations.  Our functional currency is the United States dollar. We do not transact our business in other currencies. As a result, we are not subject to exposure from movements in foreign currency exchange rates. We do not use derivative financial instruments for speculative trading purposes.


Item 4T.  Controls and Procedures


We maintain disclosure controls and procedures that are designed to ensure that the information required to be disclosed in the reports that we file under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our President and Treasurer, as appropriate, to allow timely decisions regarding required disclosures.


In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can only provide reasonable assurance of achieving the desired control objectives, and 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.


As required by SEC Rule 13a-15(b), we carried out an evaluation, under the supervision and with the participation of our management, including our President and Treasurer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of our first fiscal quarter covered by this report. Based on the foregoing, our President and Treasurer concluded that our disclosure controls and procedures were effective at the reasonable assurance level.


There has been no change in our internal controls over financial reporting during our first fiscal quarter that 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 Proceeding.


None.


Item 1A.  Risk Factors.


There have been no material changes from the risk factors disclosed in our Annual Report on Form 10-K for the year ended December 31, 2010.


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


On March 31, 2011, the Company sold 4,000,000 common shares for a total of $20,000 and issued 1,500,000 common shares in settlement of $7,500 of loans to related parties.


Item 3.  Defaults Upon Senior Securities.


None.


Item 4.  (Removed and Reserved).


Item 5.  Other Information.


None.


Item 6.  Exhibits

 

(a)          Exhibits


Exhibit No.

Description

 

 

31.1

Rule 13a-14(a)/15d-14(a) Certification of President and  Principal Executive Officer

31.2

Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer and Principal Accounting Officer

32.1

Section 1350 Certification of President and  Principal Executive Officer

32.2

Section 1350 Certification of Chief Financial Officer and Principal Accounting Officer



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.



 

 

RX TECHNOLOGIES CORP.

 

 

 

DATE:  April 28, 2011

By:

/s/ Michael McManus

 

 

Michael McManus

 

 

President and  Principal Executive Officer


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