UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

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

 

For the quarterly period ended June 30, 2012

 

☐ 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: 333-174240

 

Development Capital Group, Inc.

(Exact name of Registrant as specified in its charter)

Florida		27-3746561
(State of incorporation)		(IRS Employer ID Number)

6029 Paseo Acampo Carlsbad, California 92009

(Address of principal executive offices)

 

(760) 840-9409

(Registrant’s telephone number)

Not Applicable

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

 

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☑ No ☐

 

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	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☑
(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 ☐ No ☑

 

As of June 30, 2012 there were 12,328,000 shares of common stock, par value $0.001 per share outstanding.

 

 

 

 

TABLE OF CONTENTS

 

	Page
PART I
Item 1. Financial Statements Unaudited June 30, 2012 and Audited March 31, 2012	F-1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	3
Item 3. Quantitative and Qualitative Disclosures About Market Risk	4
Item 4(T). Controls and Procedures	4

 

 

	PART II
Item 1.	Legal Proceedings			5
Item 1A.	Risk Factors			5
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds			5
Item 3.	Defaults Upon Senior Securities			5
Item 4.	Submission of Matters to a Vote of Security Holders			5
Item 5.	Other Information			5
Item 6.	Exhibits			5
	Signatures			6

 

 

 

 

 

PART I

 

FINANCIAL INFORMATION

 

Item 1. Financial Statements.

 

TABLE OF CONTENTS

 

 

Financial Statements: PAGE

 

 

Balance Sheets for the three month periods ended June 30, 2012 (unaudited) and March 31, 2012 (audited) …… F3

 

Statements of Operations for the Three Months period ended June 30, 2012 and June 30, 2011 ……….. F4

 

Statements of Stockholders’ Equity from September 27, 2010 (Inception) to June 30, 2012 …………….. F5

 

Condensed Statements of Cash Flows for the Three Months ended June 30, 2012 and June 30, 2011…..F6

 

 

Notes to Financial Statements………………………….…………………………………………………………….. F7-F8

 

 

 

DEVELOPMENT CAPITAL GROUP, INC. (A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
AT MARCH 31, 2012 AND JUNE 30, 2012
ASSETS
		March 31, 2012				June 30,2012
Current assets:
Cash and cash equivalents		$	17,537			$	688
Deposits			—			$	—
Total assets		$	17,537			$	688
LIABILITIES AND STOCKHOLDERS' EQUITY
Commitments and contingencies
Stockholders' equity:
Common stock, $0.001 par value; 490,000,000 shares
authorized; 12,328,000 shares issued and outstanding		$	11,328				12,328
Additional paid in capital		$	44,880				44,880
Deficit accumulated during the development stage		$	(38,671	)		$	(56,520	)
Total stockholders' equity		$	17,537				688
Total liabilities and stockholders' equity		$	17,537				688

 

 

 

 

 

 

DEVELOPMENT CAPITAL GROUP, INC. (A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE  30, 2012
AND  JUNE 30, 2011
		Three month ended   June 30, 2012				Tree month Ended June 30,2011
Commissions revenue			38,000				26,043
Operating expenses:
Compensation expense			48,700				—
Professional fees			2,443				8,250
General and administrative include bank fee			4,706				3,391
Total operating expenses			55,849				11,641
Net income (loss) from operations before income taxes			(17,849	)			14,402
Share-based compensation			1,000				—
Income tax			—				—
Net income (loss)			(16,849	)			14,402
Loss per common share			0				0
Weights average of shares outstanding			12,328,000				11,228,000

 

 

 

 

 

 

 

 

 

 

 

DEVELOPMENT CAPITAL GROUP, INC. (A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF STOCKHOLDERS' EQUITY
FROM SEPTEMBER 27, 2010 (INCEPTION) TO JUNE 30, 2012
									Deficit Accumulated During the Development Stage
							Additional Paid in Capital				Total Stockholders'  Equity
			Common Stock
			Shares		Amount
Balance, September 27, 2010 (Inception)		$	-	$	-	$	-	$	-	$
	Sale of common stock		10,208,000		10,200		10,000	$	-	$	20,208
	Share-based compensation		-		-		30,800	$	-	$	30,800
	Issuance of common stock for services		1,020,000		1,020		4,080	$	-	$	5,100
	Net loss		-		-		-	$	(39,170)	$	(39,170)
Balance, March 31, 2011			11,228,000		11,228		44,880	$	(39,170)	$	16,938
	Share-based compensation		100,000		100					$	100
	Net income							$	507	$	507
	Balance, March 31, 2012	$	11,328,000	$	11,328		44,880	$	(38,663)	$	17,545
	Share-based compensation		1,000,000		1,000					$	1,000
	Net loss								(17,857)		(17,857)
	Balance,June 30,2012		12,328,000		12,328		44,880		(56,520)		688

 

 

 

 

 

 

 

 

 

DEVELOPMENT CAPITAL GROUP, INC. (A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
for the three month ended June 30, 2012
AND JUNE 30, 2011
		Three months ended                        June  30, 2012				Three month ended                         June  30, 2011
Cash flows from operating activities:
Net income (loss)		$	(17,849	)		$	14,402
Adjustments to reconcile net income (loss) to
net cash provided by (used in) operating activities
Issuance of stock for services			1,000				—
Share-based compensation
Increase in deposits			—				(9,200	)
Net cash provided by operating activities			(16,849	)			5,202
Cash flows from investing activities:			—				—
Cash flows from financing activities:
Proceeds from sale of common stock			—				—
Net cash provided by financing activities			—				—
Net increase in cash and cash equivalents			(16,849	)			5,202
Cash and cash equivalents, beginning of period			17,537				16,930
Cash and cash equivalents, end of period		$	688			$	22,132
Supplemental disclosure of cash flow information:
Cash paid for interest		$	—			$	—
Cash paid for taxes		$	—			$	—

 

 

 

 

 

 

 

F6

 

 

 

 

DEVELOPMENT CAPITAL GROUP, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS 

 

 

NOTE 1 – DESCRIPTION OF BUSINESS 

 

 

Development Capital Group, Inc. (the "Company") was incorporated under the laws of the State of Florida on September 27, 2010. The Company provides transportation and logistics services for a wide range of manufacturing, industrial and retail customers. The Company is a development-stage enterprise company and its planned principal activities are to provide freight, logistics, truckload and other services for investors and truck owners.

 

 

 

As a development-stage enterprise, the Company had limited operating revenues of $314,505 through June 30, 2012. Recorded revenues were generated from commissions earned through contracted freight services. The Company is currently devoting substantially all of its present efforts to securing and establishing a new business.

 

 

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

  

 

Use of estimates

 

The preparation of the 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 these estimates.

 

Revenue recognition

 

The Company recognizes revenue when it is realized or realizable and earned. Revenue is considered realized and earned when persuasive evidence of an arrangement exists; delivery has occurred or services have been rendered; fees to the customer are fixed or determinable; and collection of the resulting receivable is reasonably assured.

 

Cash equivalents

 

The Company considers all highly liquid instruments purchased with maturity of three months or less from the time of purchase to be cash equivalents.

 

Income Taxes

 

Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related primarily to differences between the recorded book basis and tax basis of assets and liabilities for financial and income tax reporting. The deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settle. Deferred taxes are also recognized for operating losses that are available to offset future taxable income and tax credits that are available to offset future federal income taxes.

 

Long-Lived Assets

 

The Company will review its long-lived assets and certain identifiable intangibles held and used for possible impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In evaluating the fair value and future benefits of its intangible assets, management will perform an analysis of the anticipated undiscounted future net cash flow of the individual assets over the remaining amortization period. The Company will recognize an impairment loss if the carrying value of the asset exceeds the expected future cash flows.

 

Revenues

Revenue from inception to June 30, 2012 is $314,505.

 

 

 

F7

 

 

 

 

 

DEVELOPMENT CAPITAL GROUP, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

 

 

NOTE 3 – FAIR VALUE OF FINANCIAL INSTRUMENTS

 

The carrying amounts of cash and cash equivalents approximate their fair values due to their short-term nature.

 

NOTE 4 – CONCENTRATION OF CREDIT RISK

 

The Company maintains cash balances at a financial institution in Florida. The balance, at any given time, may exceed Federal Deposit Insurance Corporation (“FDIC”) insurance limits of $250,000 per institution. The Company’s cash balances at June 30, 2012 were within FDIC insured limits.

 

NOTE 5 – COMMITMENTS AND CONTINGENCIES

 

From time to time, the Company may become subject to legal proceedings, claims and litigation arising in the ordinary course of its business. The Company is not currently a party to any material legal proceedings, nor is the Company aware of any other pending or threatened litigation that would have a material adverse effect on the Company’s business, operating results, cash flows or financial condition should such litigation be resolved unfavorably.

 

NOTE 6 – STOCKHOLDERS’ EQUITY

From the Company’s inception on September 27, 2010 through June 30, 2012, the Company has issued 12,328,000 shares of common stock with a $0.001 par value, inclusive of 9,000,000 shares issued to the Company founders and 1,120,000 shares issued to third parties for services. The Company is authorized to issue 1,000,000 shares of common stock with a par value of $0.001 for Andriy Korobkin for services he rendered to the Corporation as the Chief Executive Officer at April 24, 2012. Shares were issued and outstanding. The financial statements include a non-cash compensation charge of $31,900, representing the difference between the market price of the shares and the price paid by the founders.

  

  

 

 

F8

 

 

 

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

 

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

 

Forward-Looking Statements

 

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

For a description of such risks and uncertainties, refer to Registration Statement on Form S-1 filed with the Securities and Exchange Commission on August 29, 2011, and declared effective on

September 2, 2011. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein.

Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

 

Business Overview

 

We are a liaison between our customers who are in need of transportation services for their cargo and transportation needs and providers who will deliver our customers’ cargo. We match our customers

with transportation providers who provide shipping by truckload and less than truckload within the United States based upon delivery requirements, transportation routes, type of shipment, equipment

requirements, shipment size and price. Our prices are determined on a shipment-by-shipment basis to accommodate our customers’ needs based on the transportation provider selection, size and type of

shipment, distance and route. We do not own transportation vehicles or equipment used to transport freight, including trucks and trailers.

 

Results of Operations For the three months ending June 30, 2012 compared to the three months ending June 30, 2011.

 

Revenues

Since our September 27, 2010 inception through June 30, 2012, we generated revenues of $ 314,505. We generated revenues for the three month period ending June 30, 2012 of $38,000 and $26,043 for the three-month periods ending June 30, 2011.

 

 

3

 

 

Total operating expenses

During the three month periods ending June 30, 2012 and June 30, 2011, total operating expenses were $55,849 and $11,641. From our September 27, 2010 inception through June 30, 2012, our operating expenses were $371,024 include share-based compensation $31,900. We increased the general and administrative expenses between the periods March 31, 2012 and June 30, 2012 to $4,706. In a previous year 2011 for the same period these expenses were $3,391. Also we increased our compensation expense from $ 0 for the first quarter 2011 to $ 48,700 in the first quarter 2012 . Since our inception through June 30, 2012 our compensation expense was $299,980.

 

Net Profit/Loss

During the three-month periods ending June 30, 2012 we had a loss $17,849 and June 30, 2011 we had profit $14,402.

 

Going Concern Consideration

Our auditor's report in March 31, 2012 consolidated financial statements for fiscal year ending March 31, 2012 expressed an opinion that our capital resources were insufficient to sustain operations. Our last three months reflect net loss and our capital resources are reduced.

 

Liquidity and Capital Resources

As of June 30, 2012 and June 30, 2011, we had cash of $688 and $22,132 respectively. Cash provided by financing activities for the three-month periods ending June 30, 2012 and June 30, 2011.

 

Off Balance Sheet Arrangements

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.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

A smaller reporting company, as defined by Item 10 of Regulation S-K, is not required to provide the information required by this item.

 

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures.

As of the end of the period covered by this Report, we conducted an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the 1934 Act). Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our

disclosure controls and procedures are not effective to ensure that information required to be disclosed by us in reports that we file or submit under the 1934 Act is recorded, processed, summarized and

reported within the time periods specified in the Securities and Exchange Commission rules and forms.

 

Changes in Internal Control Over Financial Reporting.

There have been no changes in the Company’s internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Rule 240.15d-15 that occurred during

the Company’s last fiscal quarter that has materially affected, or is reasonable likely to materially

affect, the Company internal control over financial reporting., affect, the Company internal control over financial reporting., affect, the Company internal control over financial reporting.,

 

 

4

 

 

 

PART II

 

OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

There are no pending legal proceedings in which we are a party or in which any of our directors, officers or affiliates, any owner of record or beneficiary of more than 5% of any class of our voting securities is a party adverse to us or has a material interest adverse to us. Our property is not the subject of any pending legal proceedings.

 

Item 1A. Risk Factors

 

Because we are classified as a Smaller Reporting Company under the federal securities laws, we are not required to include risk factors in this Form 10-Q; however, please note risk factors included in our S-1 Registration Statement.

 

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

We did not issue unregistered securities during the quarter ending June 30, 2012.

 

Purchases of equity securities by the issuer and affiliated purchasers

During the quarter ending June 30, 2012, there were no purchases of equity securities by us or affiliated purchasers.

 

Use of Proceeds

 

None

 

Item 3. Defaults Upon Senior Securities.

 

We have no senior securities outstanding.

 

Item 4. Submission of Matters to a Vote of Security Holders.

 

We did not submit any matters to a vote of our security holders during the quarter ending June 30, 2012.

 

Item 5. Other Information.

 

None.

 

Item 6. Exhibits

 

Exhibit No.		Description
1.4		Rule 13a-14(a)/15d14(a) Certifications of Andriy Korobkin, the President, Chief Executive Officer and Director (attached hereto)
1.5		Rule 13a-14(a)/15d14(a) Certifications of Viktoriya Korobkin, the Chief Financial Officer (attached hereto)
1.6		Section 1350 Certifications of Andriy Korobkin, the President, Chief Executive Officer and Director(attached hereto)
1.7		Section 1350 Certifications of Vikoriya Korobkin Chief Financial Officer, (attached hereto)

 

 

 

5

 

 

 

 

 

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.

 

 

 

	Development Capital Group, Inc.
Dated: August 17, 2012	By:
		Andriy Korobkin, President, CEO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6