Attached files
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
Mark One
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended October 31, 2010
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ____________ to _____________
Commission File No. 333-161869
LOGAN SOUND, INC.
(Exact name of registrant as specified in its charter)
Nevada 3600 Pending
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification Number)
1 Hunter Street East, Suite G100
Hamilton, Ontario, L81 3W1
(Address of principal executive offices)
905-777-8002
(Issuer's telephone number)
Indicate by checkmark whether the issuer: (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. Yes [ ] No [X]
Indicate by check mark whether the registrant is a large accelerated filed, an
accelerated filer, a non-accelerated filer, or a smaller reporting company.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by checkmark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [X] No [ ]
Applicable Only to Issuer Involved in Bankruptcy Proceedings During the
Preceding Five Years.
N/A
Indicate by checkmark whether the issuer has filed all documents and reports
required to be filed by Section 12, 13 and 15(d) of the Securities Exchange Act
of 1934 after the distribution of securities under a plan confirmed by a court.
Yes[ ] No[ ]
Applicable Only to Corporate Registrants
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the most practicable date:
Class of Shares Outstanding as of June 20, 2012
--------------- -------------------------------
Common Stock, $0.001 6,200,000
INDEX
PART I FINANCIAL INFORMATION Page
----
Item 1. Financial Statements (unaudited) 3
BALANCE SHEETS as of October 31, 2010 and April 30, 2010 3
CONSOLIDATED STATEMENTS OF OPERATIONS for the Three Months and
Six Months Ended October 31, 2010 and 2009, and for the period
since inception 4
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY for the period
since inception 5
CONSOLIDATED STATEMENTS OF CASH FLOWS for the Six Months Ended
October 31, 2010 and 2009, and for the period since inception 6
NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS 7
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 12
Item 3 Quantitative and Qualitative Disclosures About Market Risk 13
Item 4. Controls and Procedures 13
PART II OTHER INFORMATION
Item 1. Legal Proceedings 14
Item 1A. Risk Factors 14
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 14
Item 3. Defaults Upon Senior Securities 14
Item 4 Mine Safety Disclosures 14
Item 5. Other Information 14
Item 6. Exhibits 15
SIGNATURES
2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
LOGAN SOUND INC.
(An Exploration Stage Company)
Balance Sheets
--------------------------------------------------------------------------------
October 31, April 30,
2010 2010
-------- --------
ASSETS
CURRENT ASSETS
Cash $ 2,406 $ 1,683
Wah-anti-wah guitar effects pedal -- --
-------- --------
TOTAL ASSETS $ 2,406 $ 1,683
======== ========
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ -- $ --
Loans from related parties 50,200 32,000
-------- --------
TOTAL CURRENT LIABILITIES 50,200 32,000
-------- --------
STOCKHOLDERS' EQUITY
Capital stock
Authorized:
75,000,000 common shares with a par value of $0.001
Issued and outstanding:
5,600,000 common shares 5,600 5,600
Additional paid-in-capital 22,400 22,400
Deficit accumulated during the exploration stage (75,794) (58,317)
-------- --------
TOTAL STOCKHOLDERS' EQUITY (47,794) (30,317)
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,406 $ 1,683
======== ========
Nature and continuance of operations (Note 1)
See Accompanying Notes
3
LOGAN SOUND INC.
(An Exploration Stage Company)
Statements of Operations
(Unaudited)
--------------------------------------------------------------------------------
Cumulative from
Three Months Three Months Six Months Six Months January 30, 2007
Ended Ended Ended Ended (Inception) to
October 31, October 31, October 31, October 31, October 31,
2010 2009 2010 2009 2010
------------ ------------ ------------ ------------ ------------
Bank charges $ 55 $ 100 $ 77 $ 121 $ 268
Management fees 6,900 -- 13,800 -- 43,700
Office expenses -- 578 -- 578 578
Professional fees 3,600 11,748 3,600 19,648 11,248
Guitar effects pedal -- -- -- -- 20,000
------------ ------------ ------------ ------------ ------------
Net loss $ (10,555) $ (12,426) $ (17,477) $ (20,347) $ (75,794)
------------ ------------ ------------ ------------ ------------
LOSS PER SHARE - BASIC AND DILUTED $ (0.00) $ (0.00) $ (0.00) $ (0.00)
============ ============ ============ ============
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 5,600,000 10,000,000 5,600,000 1,600,000
============ ============ ============ ============
See Accompanying Notes
4
LOGAN SOUND INC.
(An Exploration Stage Company)
Statement of Changes in Stockholders' Equity
(Unaudited)
--------------------------------------------------------------------------------
Deficit
Accumulated
Number of Additional During the
Common Par Paid-in Exploration
Shares Value Capital Stage Total
------ ----- ------- ----- -----
Balance, January 30, 2007 -- $ -- $ -- $ -- $ --
April 28, 2009
Issued for cash at $0.005 1,600,000 1,600 6,400 8,000
April 29, 2009
Issued for intangible asset at $0.005 4,000,000 4,000 16,000 20,000
Net loss (22,325) (22,325)
--------- ------- -------- -------- --------
Balance, April 30, 2009 5,600,000 5,600 22,400 (22,325) 5,675
Net loss (35,992) (35,992)
--------- ------- -------- -------- --------
Balance, April 30, 2010 5,600,000 5,600 22,400 (58,317) (30,317)
Net loss (17,477) (17,477)
--------- ------- -------- -------- --------
Balance, October 31, 2010 5,600,000 $ 5,600 $ 22,400 $(75,794) $(47,794)
========= ======= ======== ======== ========
See Accompanying Notes
5
LOGAN SOUND INC.
(An Exploration Stage Company)
Statements of Cash Flows
(Unaudited)
--------------------------------------------------------------------------------
Cumulative from
Six Months Six Months January 30, 2007
Ended Ended (Inception) to
October 31, October 31, October 31,
2010 2009 2010
-------- -------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(17,477) $(20,347) $(75,794)
Guitar effects pedal -- -- 20,000
Adjustments to reconcile net loss to net cash
Accounts payable and accrued liabilities -- -- --
-------- -------- --------
Net cash used in operating activities (17,477) (20,347) (55,794)
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Loans from related parties 18,200 20,000 50,200
Shares subscribed for cash -- -- 8,000
-------- -------- --------
Net cash provided by financing activities 18,200 -- 58,200
-------- -------- --------
Net increase (decrease) in cash 723 (347) 2,406
Cash beginning 1,683 5,675 --
-------- -------- --------
Cash ending $ 2,406 $ 5,328 $ 2,406
======== ======== ========
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for:
Interest $ -- $ -- $ --
======== ======== ========
Taxes $ -- $ -- $ --
======== ======== ========
See Accompanying Notes
6
LOGAN SOUND INC.
(An Exploration Stage Company)
Notes to the Financial Statements
October 31, 2010
(Unaudited)
--------------------------------------------------------------------------------
1. NATURE AND CONTINUANCE OF OPERATIONS
Logan Sound Inc. ("the Company") was incorporated under the laws of State
of Nevada, U.S. on January 30, 2007, with an authorized capital of
75,000,000 common shares with a par value of $0.001. The Company's year end
is the end of April. During the year ended April 30, 2009, the Company
commenced operations by issuing shares to acquire a 100% right, title and
interest in and to all the property, assets and intellectual property
necessary for the development, manufacture and marketing of the
wah-anti-wah guitar effects pedal.
These financial statements have been prepared on a going concern basis
which assumes the Company will be able to realize its assets and discharge
its liabilities in the normal course of business for the foreseeable
future. The Company has incurred losses since inception resulting in an
accumulated deficit of $75,794 as at October 31, 2010 and further losses
are anticipated in the development of its business raising substantial
doubt about the Company's ability to continue as a going concern. The
ability to continue as a going concern is dependent upon the Company
generating profitable operations in the future and/or to obtain the
necessary financing to meet its obligations and repay its liabilities
arising from normal business operations when they come due. Management
intends to finance operating costs over the next twelve months with
existing cash on hand and loans from directors and/or private placement of
common stock.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The financial statements of the Company have been prepared in accordance
with generally accepted accounting principles in the United States of
America and are presented in US dollars.
Exploration Stage Company
The Company complies with the Financial Accounting Standards Board
Statement No. 7, its characterization of the Company as an exploration
stage enterprise.
Use of Estimates and Assumptions
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the period. Actual results could differ from those estimates.
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LOGAN SOUND INC.
(An Exploration Stage Company)
Notes to the Financial Statements
October 31, 2010
(Unaudited)
--------------------------------------------------------------------------------
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Foreign Currency Translation
The financial statements are presented in United States dollars. In
accordance with Statement of Financial Accounting Standards No. 52,
"Foreign Currency Translation", foreign denominated monetary assets and
liabilities are translated into their United States dollar equivalents
using foreign exchange rates which prevailed at the balance sheet date. Non
monetary assets and liabilities are translated at the exchange rates
prevailing on the transaction date. Revenue and expenses are translated at
average rates of exchange during the year. Gains or losses resulting from
foreign currency transactions are included in results of operations.
Fair Value of Financial Instruments
The carrying value of cash and accounts payable and accrued liabilities
approximates their fair value because of the short maturity of these
instruments. Unless otherwise noted, it is management's opinion the Company
is not exposed to significant interest, currency or credit risks arising
from these financial instruments.
Environmental Costs
Environmental expenditures that relate to current operations are expensed
or capitalized as appropriate. Expenditures that relate to an existing
condition caused by past operations, and which do not contribute to current
or future revenue generation, are expensed. Liabilities are recorded when
environmental assessments and/or remedial efforts are probable, and the
cost can be reasonably estimated. Generally, the timing of these accruals
coincides with the earlier of completion of a feasibility study or the
Company's commitments to plan of action based on the then known facts.
Income Taxes
The Company follows the assets and liability method of accounting for
income taxes. Under this method, deferred income tax assets and liabilities
are recognized for the estimated tax consequences attributable to
differences between the financial statement carrying values and their
respective income tax basis (temporary differences). The effect on deferred
income tax assets and liabilities of a change in tax rates is recognized in
income in the period that includes the enactment date.
At October 31, 2010, a full deferred tax asset valuation allowance has been
provided and no deferred tax asset has been recorded.
Basic and Diluted Loss Per Share
The Company computes loss per share in accordance with SFAS No. 128,
"Earnings per Share" which requires presentation of both basic and diluted
earnings per share on the face of the statement of operations. Basic loss
per share is computed by dividing net loss available to common shareholders
by the weighted average number of outstanding common shares during the
period. Diluted loss per share gives effect to all dilutive potential
common shares outstanding during the period. Dilutive loss per share
excludes all potential common shares if their effect is anti-dilutive.
The Company has no potential dilutive instruments and accordingly basic
loss and diluted loss per share are equal.
8
LOGAN SOUND INC.
(An Exploration Stage Company)
Notes to the Financial Statements
October 31, 2010
(Unaudited)
--------------------------------------------------------------------------------
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Stock-based Compensation
In December 2004, the FASB issued SFAS No. 123R, "Share-Based Payment",
which replaced SFAS No. 123, "Accounting for Stock-Based Compensation" and
superseded APB Opinion No. 25, "Accounting for Stock Issued to Employees".
In January 2005, the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin ("SAB") No. 107, "Share-Based Payment", which
provides supplemental implementation guidance for SFAS No. 123R. SFAS No.
123R requires all share-based payments to employees, including grants of
employee stock options, to be recognized in the financial statements based
on the grant date fair value of the award. SFAS No. 123R was to be
effective for interim or annual reporting periods beginning on or after
June 15, 2005, but in April 2005 the SEC issued a rule that will permit
most registrants to implement SFAS No. 123R at the beginning of their next
fiscal year, instead of the next reporting period as required by SFAS No.
123R. The pro-forma disclosures previously permitted under SFAS No. 123 no
longer will be an alternative to financial statement recognition. Under
SFAS No. 123R, the Company must determine the appropriate fair value model
to be used for valuing share-based payments, the amortization method for
compensation cost and the transition method to be used at date of adoption.
The transition methods include prospective and retroactive adoption
options. Under the retroactive options, prior periods may be restated
either as of the beginning of the year of adoption or for all periods
presented. The prospective method requires that compensation expense be
recorded for all unvested stock options and restricted stock at the
beginning of the first quarter of adoption of SFAS No. 123R, while the
retroactive methods would record compensation expense for all unvested
stock options and restricted stock beginning with the first period
restated. The Company adopted the modified prospective approach of SFAS No.
123R for the year ended April 30, 2009. The Company did not record any
compensation expense for the period ended October 31, 2010 because there
were no stock options outstanding prior to the adoption or at October 31,
2010.
Intangible assets
In accordance with Statement of Financial Accounting Standards ("SFAS") No.
142, "Goodwill and Other Intangible Assets", the Company recorded
Wah-Anti-Wah Guitar Effects Pedal at cost and those with finite lives are
amortized over the estimated periods of benefit. Wah-Anti-Wah Guitar
Effects Pedal would be amortized over 10 years.
Impairments
The Company's management evaluates its tangible and definite-lived
intangible assets for impairment under Statement of Financial Accounting
Standards No. 144 Accounting for the Impairment or Disposal of Long-Lived
Assets (SFAS 144) annually or in the presence of circumstances or trends
that may be indicators of impairment. Our evaluation is a two step process.
The first step is to compare our undiscounted cash flows, as projected over
the remaining useful lives of the assets, to their respective carrying
values. In the event that the carrying values are not recovered by future
undiscounted cash flows, as a second step, we compare the carrying values
to the related fair values and, if lower, record an impairment adjustment.
For purposes of fair value, we generally use replacement costs for tangible
fixed assets and discounted cash flows, using risk-adjusted discount rates,
for intangible assets. During the years ended October 31, 2010, we recorded
impairment charges of $0 related to intangible assets.
9
LOGAN SOUND INC.
(An Exploration Stage Company)
Notes to the Financial Statements
October 31, 2010
(Unaudited)
--------------------------------------------------------------------------------
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
RECENT ACCOUNTING PRONOUNCEMENTS
In September 2006, the FASB issued Statement No. 157, "Fair Value
Measurements" ("SFAS 157"). SFAS 157 defines fair value, establishes a
framework and gives guidance regarding the methods used for measuring fair
value, and expands disclosures about fair value measurements. SFAS 157 is
effective for financial statements issued for fiscal years beginning after
November 15, 2007, and interim periods within those fiscal years. Our
adoption of SFAS No. 157 is not expected to materially impact our financial
position and results of operations. In February 2007, the FASB issued
Statement No. 159, "The Fair Value Option for Financial Assets and
Financial Liabilities" ("SFAS 159") which permits entities to choose to
measure many financial instruments and certain other items at fair value
that are not currently required to be measured at fair value. SFAS 159 is
effective for fiscal years beginning after November 15, 2007. Our adoption
of SFAS No. 159 is not expected to materially impact our financial position
and results of operations.
In December 2007, the FASB issued Statement No. 141(R), "Business
Combinations" ("SFAS 141(R)") which expands the definition of transactions
and events that qualify as business combinations; requires that the
acquired assets and liabilities, including contingencies, be recorded at
the fair value determined on the acquisition date and changes thereafter
reflected in earnings, not goodwill; changes the recognition timing for
restructuring costs; and requires acquisition costs to be expensed as
incurred. In addition, acquired in-process research and development (IPR&D)
is capitalized as an intangible asset and amortized over its estimated
useful life. Adoption of SFAS 141(R) is required for combinations after
December 15, 2008. Early adoption and retroactive application of SFAS
141(R) to fiscal years preceding the effective date are not permitted. We
believe that there is no impact of SFAS 141(R) on our financial position
and results of operations.
In December 2007, the FASB issued Statement No. 160, "NONCONTROLLING
INTEREST IN CONSOLIDATED FINANCIAL STATEMENTS" ("SFAS 160") which
re-characterizes minority interests in consolidated subsidiaries as
non-controlling interests and requires the classification of minority
interests as a component of equity. Under SFAS 160, a change in control
will be measured at fair value, with any gain or loss recognized in
earnings. The effective date for SFAS 160 is for annual periods beginning
on or after December 15, 2008. Early adoption and retroactive application
of SFAS 160 to fiscal years preceding the effective date are not permitted.
We believe that there is no impact of SFAS 160 on our financial position
and results of operations.
3. COMMON STOCK
The total number of common shares authorized that may be issued by the
Company is 75,000,000 shares with a par value of one tenth of one cent
($0.001) per share and no other class of shares is authorized.
During the year ended April 30, 2009, the Company issued 1,600,000 shares
of common stock for total cash proceeds of $8,000.
As of April 29, 2009, the Company entered into an Asset Purchase Agreement
with Ken Logan. Ken Logan agreed to sell his 100% interest in all the
property, assets and intellectual property necessary for the development,
manufacture and marketing of the wah-anti-wah guitar effects pedal for
4,000,000 common shares.
At October 31, 2010, there were no outstanding stock options or warrants.
10
LOGAN SOUND INC.
(An Exploration Stage Company)
Notes to the Financial Statements
October 31, 2010
(Unaudited)
--------------------------------------------------------------------------------
4. INCOME TAXES
As of October 31, 2010, the Company had net operating loss carry forwards
of approximately $75,794 that may be available this Agreement to reduce
future years' taxable income through 2029. Future tax benefits which may
arise as a result of these losses have not been recognized in these
financial statements, as their realization is determined not likely to
occur and accordingly, the Company has recorded a valuation allowance for
the deferred tax asset relating to these tax loss carry-forwards.
5. MANAGEMENT AGREEMENT
As of April 29, 2009, the Company entered into a management agreement with
Ken Logan and agrees to pay $2,300 per month for his services.
6. RELATED PARTY TRANSACTIONS
The sole officer and director of the Company may, in the future, become
involved in other business opportunities as they available, he may face a
conflict in selecting between the Company and his other business
opportunities. The Company has not formulated a policy for the resolution
of such conflict.
Kent Logan, the sole officer and director of the Company, will not be paid
for any underwriting services that he performs on behalf of the Company
with respect to the Company's upcoming offering. He will also not receive
any interest on any funds that he advances to the Company for offering
period prior to the offering being closed which will be repaid from the
procedures of the offering.
While the Company is seeking additional capital, Mr. Logan has advanced
funds to the Company to pay any costs incurred by it. These funds are
interest free. The balance due Mr. Logan was $50,200 on October 31, 2010.
11
FORWARD LOOKING STATEMENTS
Statements made in this Form 10-Q that are not historical or current facts are
"forward-looking statements" made pursuant to the safe harbor provisions of
Section 27A of the Securities Act of 1933 (the "Act") and Section 21E of the
Securities Exchange Act of 1934. These statements often can be identified by the
use of terms such as "may," "will," "expect," "believe," "anticipate,"
"estimate," "approximate" or "continue," or the negative thereof. We intend that
such forward-looking statements be subject to the safe harbors for such
statements. We wish to caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made. Any
forward-looking statements represent management's best judgment as to what may
occur in the future. However, forward-looking statements are subject to risks,
uncertainties and important factors beyond our control that could cause actual
results and events to differ materially from historical results of operations
and events and those presently anticipated or projected. We disclaim any
obligation subsequently to revise any forward-looking statements to reflect
events or circumstances after the date of such statement or to reflect the
occurrence of anticipated or unanticipated events.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATION
GENERAL
We intend to commence business operations by developing, manufacturing,
marketing and selling electric guitar effects pedals. We were incorporated in
the State of Nevada on January 30, 2007, but were essentially dormant until
April 29, 2009 when we entered into an agreement with our president, Ken Logan,
to acquire all the property, assets and intellectual property necessary for the
development, manufacture and marketing of the wah anti wah guitar effects pedal.
In consideration of the purchase of these assets, we issued 4,000,000 shares of
our common stock to Mr. Logan.
Mr. Logan commenced developing and manufacturing the wah anti wah guitar effects
pedal in December 2006. Prior to selling his interest in the pedal to us, Mr.
Logan sold approximately 40 wah anti wah pedals at prices ranging from $149 to
$199. He also developed a website promoting the features of the wah anti wah
pedal at www.logansoundinc.com.
PLAN OF OPERATION
Our plan of operation for the next twelve months is to expand our business
operations by acquiring additional guitar pedal components, hiring additional
labor, marketing and advertising our guitar effects pedal, and potentially
designing a new guitar effects pedal. We intend to allocate approximately $5,000
from our cash on hand to purchase guitar pedal components that will allow us to
manufacture approximately 125 pedals. We will rely upon the proceeds that we
receive from the sale of the 125 guitar pedals and loans from our president in
order to cover general and administrative expenses, as well as marketing and
advertising costs.
We anticipate that revenue from the sale of our pedals will be $214 per unit,
including charges for shipping and handling. However, there is no guarantee that
we will be able to successfully sell our guitar effects pedals at a sufficient
sales volume at this price level. The expansion of our operations in the period
subsequent to the next 12 months will depend on our success in generating
revenue to that point, as well as raising further funding. As well, we
anticipate spending an additional $16,000 on administrative costs such as
accounting and auditing fees, legal fees and fees payable in connection with
reporting obligations.
SOURCES AND USES OF CASH
At October 31, 2010, our current assets consisted of $2,406 in cash. Subsequent
to the period, we raised $30,000 pursuant to our registration statement on Form
S-1 that was declared effective by the Securities & Exchange Commission on
October 27, 2010. In addition to the funds raised during our offering, we will
have to raise additional funds in the next twelve months in order to sustain and
expand our operations. We currently do not have a specific plan of how we will
12
obtain such funding. We will seek to obtain short-term loans from our director,
although we do not have any agreements with our director concerning future
loans. We do not have any arrangements in place for any future equity financing
other than through this offering.
EVENTS, TRENDS AND UNCERTAINTIES
The continuing development of our business will depend upon our ability to
attract customers for the wah anti wah guitar effects pedal. Our ability to
generate sales may be affected by events and trends such as general economic
conditions, guitar pedal pricing and competing products from our manufacturers.
RESULTS OF OPERATIONS
We have not earned any revenue from our incorporation on January 30, 2007 to
October 31, 2010. We incurred operating expenses in the amount of $75,794 during
this period. These operating expenses were comprised of management fees that
were paid or accrued to our president, Ken Logan, of $43,700, professional fees
of $11,248, office expenses of $578, bank fees of $268 and $20,000 representing
the recorded value of the common stock that we issued to our president in
consideration for the acquisition of the guitar pedal assets.
We have not attained profitable operations and are dependent upon obtaining
financing to complete our proposed business plan. For these reasons our auditors
believe that there is substantial doubt that we will be able to continue as a
going concern.
OFF-BALANCE SHEET ARRANGEMENTS
As of the date of this report, we do not have any 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.
GOING CONCERN
The independent auditors' report accompanying our April 30, 2010 financial
statements contained an explanatory paragraph expressing substantial doubt about
our ability to continue as a going concern. The financial statements have been
prepared "assuming that we will continue as a going concern," which contemplates
that we will realize our assets and satisfy our liabilities and commitments in
the ordinary course of business.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
No report required.
ITEM 4. CONTROLS AND PROCEDURES
Our management is responsible for establishing and maintaining a system of
disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e)
under the Exchange Act) that is designed to ensure that information required to
be disclosed by us in the reports that we file or submit under the Exchange Act
is recorded, processed, summarized and reported, within the time periods
specified in the Commission's rules and forms. Disclosure controls and
procedures include, without limitation, controls and procedures designed to
ensure that information required to be disclosed by an issuer in the reports
that it files or submits under the Exchange Act is accumulated and communicated
to the issuer's management, including its principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, as appropriate to allow timely decisions regarding required
disclosure.
13
An evaluation was conducted under the supervision and with the participation of
our management of the effectiveness of the design and operation of our
disclosure controls and procedures as of October 31, 2010. Based on that
evaluation, our management concluded that our disclosure controls and procedures
were not effective as of such date to ensure that information required to be
disclosed in the reports that we file or submit under the Exchange Act, is
recorded, processed, summarized and reported within the time periods specified
in SEC rules and forms. Such officer also confirmed that there was no change in
our internal control over financial reporting during the six-month period ended
October 31, 2010 that has materially affected, or is reasonably likely to
materially affect, our internal control over financial reporting.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Management is not aware of any legal proceedings contemplated by any
governmental authority or any other party involving us or our properties. As of
the date of this report, no director, officer or affiliate is (i) a party
adverse to us in any legal proceeding, or (ii) has an adverse interest to us in
any legal proceedings. Management is not aware of any other legal proceedings
pending or that have been threatened against us or our properties.
ITEM 1A. RISK FACTORS
No report required.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
No report required.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
No report required.
ITEM 4. MINE SAFETY DISCLOSURES
No report required.
ITEM 5. OTHER INFORMATION
No report required.
ITEM 6. EXHIBITS
31.1 Certification of Chief Executive Officer and Chief Financial Officer
pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
32.1 Certifications pursuant to Securities Exchange Act of 1934 Rule 13a-14(b)
or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes- Oxley Act of 2002.
14
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
LOGAN SOUND INC.
Dated: June 20, 2012 By: /s/ Ken Logan
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Ken Logan, President and Chief Executive Officer
and Chief Financial Officer
1
