Attached files

file filename
EXCEL - IDEA: XBRL DOCUMENT - City Media, Inc.Financial_Report.xls
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R6.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R1.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R4.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R8.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R2.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R3.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R5.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R9.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R7.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R12.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R11.htm
EX-32 - CITY MEDIA, INC. - 10Q 12-31-12 EX. 32 - City Media, Inc.citymedia10q123112ex32.htm
EX-31 - CITY MEDIA, INC. - 10Q 12-31-12 EX. 31 - City Media, Inc.citymedia10q123112ex31.htm
XML - IDEA: XBRL DOCUMENT - City Media, Inc.R10.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
______________
 
 
FORM 10-Q
 
______________
 

 
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended December 31, 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: 333-171488

CITY MEDIA, INC.
(Exact Name of Registrant as specified in its charter)


Utah
 
26-1805170
(State or other jurisdiction of incorporation)
 
(I.R.S. Employer I.D. No.)


4685 S. Highland Drive, Suite 202
Salt Lake City, UT  84117
(Address of Principal Executive Office)

(801) 278-9424
(Registrant’s Telephone Number, including Area Code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]

Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).  Yes [X]   No [  ]  (The Registrant does not maintain a website.)

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 definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 
 
 
 



Large accelerated filer [  ]
Accelerated filer [  ]
Non-accelerated filer [  ]
Smaller reporting company [X]

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] No [X]

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

The number of shares outstanding of each of the Registrant’s classes of common equity, as of the latest practicable date:

     
     
Class
 
Outstanding as of February 5, 2013
Common Capital Voting Stock, $0.001 par value per share
 
8,968,000 shares

FORWARD LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, Financial Statements and Notes to Financial Statements contains forward-looking statements that discuss, among other things, future expectations and projections regarding future developments, operations and financial conditions. All forward-looking statements are based on management’s existing beliefs about present and future events outside of management’s control and on assumptions that may prove to be incorrect. If any underlying assumptions prove incorrect, our actual results may vary materially from those anticipated, estimated, projected or intended.

PART I - FINANCIAL STATEMENTS

Item 1. Financial Statements.

December 31, 2012
C O N T E N T S

Condensed Consolidated Balance Sheets
3
Condensed Consolidated Statements of Operations
4
Condensed Consolidated Statements of Cash Flows
5
Notes to Condensed Consolidated Financial Statements
6






 
2
 
 


CITY MEDIA, INC.
Condensed Consolidated Balance Sheets
December 31, 2012 and September 30, 2012
(Unaudited)

   
12/31/2012
   
9/30/2012
 
             
ASSETS
           
             
Current Assets:
           
Cash
  $ 4,641     $ 2,309  
Accounts Receivable
    1,910       2,028  
Total Current Assets
    6,551       4,337  
Property plant & equipment net of accumulated depreciation
               
of $8,726 and $8,423, respectively
    13,428       13,731  
Intangible Assets
    33,677       33,677  
                 
TOTAL ASSETS
  $ 53,656     $ 51,745  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
               
                 
Current Liabilities:
               
Related Party Accounts Payable
  $ 1,400     $ 1,400  
Accounts Payable
    11,466       963  
Current portion of long term debt - Related Party
    4,438       5,261  
Total Current Liabilities
    17,304       7,624  
Long Term Liabilities:
               
Accrued Interest Related Party
    2,408       1,602  
Notes Payable to Related Parties
    39,000       36,000  
Total Long Term Liabilities
    41,408       37,602  
Total Liabilities
    58,712       45,226  
                 
Stockholders' Equity (Deficit)
               
Preferred Stock 10,000,000 shares authorized having a
               
par value of $0.001 per share; with no shares issued and
               
outstanding as of December 31, 2012 and September 30, 2012,
               
respectively
    -       -  
Common Stock 90,000,000 shares authorized having a
               
par value of $0.001 per share; 8,968,000 shares issued and
               
outstanding as of December 31, 2012 and September 30, 2012,
               
respectively
    8,968       8,968  
Additional Paid-in Capital
    83,875       83,875  
Accumulated Deficit
    (97,899 )     (86,324 )
Total Stockholders' Equity (Deficit)
    (5,056 )     6,519  
                 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
  $ 53,656     $ 51,745  


The accompanying notes are an integral part of these condensed consolidated financial statements.

 
3
 
 



CITY MEDIA, INC.
Condensed Consolidated Statements of Operations
For the Three Months Ended December 31, 2012 and 2011
(Unaudited)


   
For the
   
For the
 
   
Three Months
   
Three Months
 
   
Ended
   
Ended
 
   
December 31,
   
December 31,
 
   
2012
   
2011
 
Revenues
           
Revenues from transaction fees
  $ 6,303     $ 8,382  
Total Revenues
    6,303       8,382  
                 
Operating Expenses
               
General and Administrative
    12,569       12,228  
Depreciation
    303       404  
Loss on Sale of Equipment
    -       4,749  
Service, related party
    4,200       4,200  
Total Operating Expense
    17,072       21,581  
Operating Loss
    (10,769 )     (13,199 )
Interest Expense, related party
    806       99  
Net Loss
  $ (11,575 )   $ (13,298 )
Loss per Common Share - Basic & Diluted
  $ (0.01 )   $ (0.01 )
Weighted Average Shares Outstanding -  Basic & Diluted
    8,968,000       8,968,000  



The accompanying notes are an integral part of these condensed consolidated financial statements.



 
4
 
 


CITY MEDIA, INC.
Condensed Consolidated Statements of Cash Flows
For the Three Months Ended December 31, 2012 and 2011
(Unaudited)

   
For the
   
For the
 
   
Three Months
   
Three Months
 
   
Ended
   
Ended
 
   
December 31,
   
December 31,
 
   
2012
   
2011
 
             
Cash Flows From Operating Activities
           
Net Loss
  $ (11,575 )   $ (13,298 )
Adjustments to reconcile net loss to net cash
               
from operating activities:
               
Depreciation
    303       404  
Loss on sale of equipment
    -       4,749  
(Increase)/Decrease in accounts receivable
    118       (3,499 )
Increase/(Decrease) in accounts payable
    10,503       6,446  
Accrued interest on related party loan
    806       99  
Net Cash from Operating Activities
    155       (5,099 )
                 
Cash Flows from Investing Activities
               
Proceeds from sale of equipment
    -       3,000  
Net Cash from Investing Activities
    -       3,000  
                 
Cash Flows from Financing Activities
               
Principal payments on Notes Payable
    (823 )     -  
Proceeds from notes payable to related parties
    3,000       -  
Net Cash from Investing Activities
    2,177       -  
                 
Net Increase/(Decrease) in Cash
    2,332       (2,099 )
Beginning Cash Balance
    2,309       4,123  
Ending Cash Balance
  $ 4,641     $ 2,024  
                 
Supplemental Disclosure of Cash Flow Information
               
Cash paid during the period for interest
  $ 125     $ -  
Cash paid during the period for taxes
  $ 200     $ -  
Assets acquired in exchange for related party debt
  $ -     $ -  


The accompanying notes are an integral part of these condensed consolidated financial statements.

 
5
 
 


CITY MEDIA, INC.
Notes to Condensed Consolidated Financial Statements
December 31, 2012

NOTE 1 - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The accompanying financial statements have been prepared by the Company without audit.  In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at December 31, 2012, and for all periods presented herein, have been made.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted.  It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended September 30, 2012.  The results of operations for the three month period ended December 31, 2012 are not necessarily indicative of the operating results for the full year.

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Recent Accounting Pronouncements

The Company has reviewed all recently issued, but not yet adopted, accounting standards in order to determine their effects, if any, on its consolidated results of operation, financial position or cash flows.  Based on that review, the Company believes that none of these pronouncements will have a significant effect on its condensed consolidated financial statements.

NOTE 3 – RELATED PARTY TRANSACTIONS / SERVICE AGREEMENT

The Company has a Service Agreement with Wasatch ATM (“Wasatch”), a Utah limited liability corporation owned and managed by a Company stockholder.  The agreement provides for Wasatch to provide all maintenance, repair and service work along with distribution of vault cash.  Wasatch is compensated at a set rate of $1,400 per month. The agreement is for thirty-six months and provides for an additional one-time $500 payable upon the placement of each additional ATM and an allowance of $500 per quarter for expenses.

As of December 31, 2012 and 2011, $1,400 and $1,400, respectively, was due to Wasatch, which is included in the “Related Party Accounts Payable” line item.


 
6
 
 


NOTE 4 - RELATED PARTY TRANSACTIONS / LONG-TERM DEBT

During the year ended September 30, 2011, the Company received $17,001 from certain shareholders to cover expenses during the year.  On December 6, 2011 the Company signed convertible promissory notes with these shareholders resulting in a reclassification of $17,001 from a current liability to long-term notes payable.  During the year ended September 30, 2012, the Company borrowed an additional $18,999 on these notes. The notes are convertible into shares of the Company’s common stock at a conversion price of $0.10 per share at the option of the Company.  As of December 6, 2011 and until the notes are converted or settled, the loan from certain shareholders accrues interest at 8.5% per annum.  Total accrued interest on these loans from shareholders at December 31, 2012 totaled $2,400.  Interest and principal is due on December 6, 2014.

As of September 30, 2012, the Company had depleted its access to the capital pursuant to the promissory notes dated December 6, 2011, while sustaining operations, legal expenses, and more recently, attaining its DTC eligibility.  On September 28, 2012, the Company signed convertible promissory notes with certain shareholders that provided for additional liquidity resources in the amount of $24,000, with $21,000 available at December 31, 2012, to be used at the Company’s discretion.  The notes are convertible into shares of the Company’s common stock at a conversion price of $0.10 per share at the option of the Company.  As of December 20, 2012 and until the notes are converted, the loan from certain shareholders accrues interest on any outstanding amount at a rate of 8.5% per annum.  Total accrued interest on these loans from shareholders at December 31, 2012 totaled $8.  Interest and principal will be due on September 28, 2014.

In conjunction with new ADA compliance regulations that took effect on March 15, 2012, requiring certain costly upgrades be made to all Hantle/Tranax and Hyosung ATM machines, the Company’s Board of Directors gave their unanimous consent on March 1, 2012, to purchase three new ATM machines that comply with the new ADA compliance regulations.  The Board agreed that the new machines should be purchased and financed through our servicing partner, Wasatch ATM.  The balance of $6,800 began accruing interest of 10% APR on April 1, 2012.  Monthly payments of $316 are due on the first of every month, commencing on May 1, 2012, until the loan is paid in full on March 1, 2014.

The Company utilizes office and storage space of its executive officers, for which no incremental costs are incurred.  No monetary value has been placed on this, nor have any accruals or payments been made.  Additionally, the Company has no employees who are not executive officers.  There are no amounts due to or from these parties as of the balance sheet date.

 
 

 
7
 
 


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

Forward-looking Statements

Statements made in this Quarterly Report which are not purely historical are forward-looking statements with respect to the goals, plan objectives, intentions, expectations, financial condition, results of operations, future performance and our business, including, without limitation, (i) our ability to raise capital, and (ii) statements preceded by, followed by or that include the words “may,” “would,” “could,” “should,” “expects,” “projects,” “anticipates,” “believes,” “estimates,” “plans,” “intends,” “targets” or similar expressions.

Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond our control) that could cause actual results to differ materially from those set forth in the forward-looking statements, including the following: general economic or industry conditions, nationally and/or in the communities in which we may conduct business, changes in the interest rate environment, legislation or regulatory requirements, conditions of the securities markets, our ability to raise capital, changes in accounting principles, policies or guidelines, financial or political instability, acts of war or terrorism, other economic, competitive, governmental, regulatory and technical factors affecting our current or potential business and related matters.

Accordingly, results actually achieved may differ materially from expected results in these statements.  Forward-looking statements speak only as of the date they are made.  We do not undertake, and specifically disclaim, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statements.

Plan of Operations

Our primary focus for 2012-2013 is the continued placing, managing, and servicing of ATM machines for public utilization along the Wasatch Front in the State of Utah.

Results of Operations

Three Months Ended December 31, 2012 Compared to Three Months Ended December 31, 2011

During the three months ended December 31, 2012, we recognized $6,303 in revenues.  During the three months ended December 31, 2011, we recognized $8,382 in revenues.  The decrease in revenue for the period ended 2012 over the same period in 2011 can be attributed to new regulations governing surcharge fees and the termination of four of our ATM locations during 2012.

We had a net loss for the three months ended December 31, 2012, of $11,575 and a net loss of $13,298 for the three months ended December 31, 2011.  Part of the loss for 2011 was the result of increased expenses related to SEC reporting obligations.  The loss for 2012 is the result of decreased revenue due to the closure of four of our ATM locations, as well as increased expenses related to complying with new XBRL filing requirements.  As we expand our operations, we are hopeful our revenues should start to increase.  We will need additional capital to expand operations and anticipate seeking equity capital in 2013.

Additionally, as our business operations are only beginning, it is difficult to predict our ability to generate sufficient revenue to generate positive cash flows.  Currently our biggest expenses are related to general and administrative costs which were $12,569 for the three months ended December 31, 2012 and $12,228 for the three months ended December 31, 2011.  Our service fee to maintain ATM cash levels and operating functionality is $1,400 a month.  We anticipate these fees remaining constant during 2013; however, they may rise in the future as we deploy more machines.

 
8
 
 


Liquidity and Capital Requirements

We had $4,641 cash or cash equivalents on hand as of December 31, 2012. During the years ended September 30, 2012 and 2011, we received $36,001 from certain shareholders to cover expenses during those years, for which, on December 6, 2011 the Company signed convertible promissory notes.  Until the notes are converted or settled, the loan from certain shareholders accrues interest at 8.5% per annum.  Accrued interest on these loans from shareholders for the three-month period ended December 31, 2012 totaled $798.  Total accrued interest on these loans from shareholders at December 31, 2012 totaled $2,400.  Interest and principal is due on December 6, 2013.

As of September 30, 2012, the Company had depleted its access to the capital pursuant to the promissory notes dated December 6, 2011, while sustaining operations, legal expenses, and more recently, attaining its DTC eligibility.  On September 28, 2012, the Company signed convertible promissory notes with certain shareholders that provided for additional liquidity resources in the amount of $24,000, with $21,000 available at December 31, 2012, to be used at the Company’s discretion.  The notes are convertible into shares of the Company’s common stock at a conversion price of $0.10 per share at the option of the Company.  As of December 20, 2012 and until the notes are converted, the loan from certain shareholders accrues interest on any outstanding amount at a rate of 8.5% per annum.  Accrued interest on loans from shareholders for the three-month period ended December 31, 2012 totaled $8.  Interest and principal will be due on September 28, 2014.

Total accrued interest on all loans from shareholders at December 31, 2012 totaled $2,408.

The Company has accumulated operating losses of $97,899.  Currently, management’s plans include placing more ATMs in retail locations in order to improve our cash flows.  The Company has an availability of funds sufficient for the next 12 months.

Off-balance Sheet Arrangements

Neither City Media nor its wholly-owned subsidiary have had any off balance sheet arrangements from their respective periods to the date hereof.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

Not required.

Item 4.  Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in rules and forms adopted by the Securities and Exchange Commission, and that such information is accumulated and communicated to management, including the President and Secretary, to allow timely decisions regarding required disclosures.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act).  Based upon that evaluation, our President and Treasurer concluded that, as of the end of the period covered by this Quarterly Report, our disclosure controls and procedures were effective.

 
9
 
 



Changes in Internal Control Over Financial Reporting

During the fiscal quarter covered by this Quarterly Report, there has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

We are not a party to any pending legal proceeding.  To the knowledge of management, no federal, state or local governmental agency is presently contemplating any proceeding against us. No director, executive officer or affiliate of ours or owner of record or beneficially of more than five percent of our common stock is a party adverse to us or has a material interest adverse to us in any proceeding.

Item 1A. Risk Factors

Not required.

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

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosure

We have no mining activities.

Item 5. Other Information

Item 6. Exhibits

Exhibit No.
Identification of Exhibit
8-A12G
Registration of Securities as filed on June 29, 2012.
31
Certification of Thomas J. Howells Pursuant to Section 302 of the Sarbanes-Oxley Act.
32
Certification of Thomas J. Howells pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act.
101.INS
XBRL Instance Document*
101.SCH
XBRL Taxonomy Extension Schema*
101.CAL
XBRL Taxonomy Extension Calculation Linkbase*
101.DEF
XBRL Taxonomy Extension Definition Linkbase*
101.LAB
XBRL Taxonomy Extension Label Linkbase*
101.PRE
XBRL Taxonomy Extension Presentation Linkbase*

 
10
 
 



*Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed “furnished” and not “filed” or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, or deemed “furnished” and not “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, and otherwise is not subject to liability under these sections.

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.

CITY MEDIA, INC.
(Issuer)

Date:
February 5, 2013
 
By:
  /s/ Thomas J. Howells
       
Thomas J. Howells, Director, President and Chief Executive Officer, Principal Financial Officer



11