Attached files
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EX-31.1 - INTERNET INFINITY, INC. | ex31-1.htm |
EX-31.2 - INTERNET INFINITY, INC. | ex31-2.htm |
EX-32.2 - INTERNET INFINITY, INC. | ex32-2.htm |
EX-32.1 - INTERNET INFINITY, INC. | ex32-1.htm |
EXCEL - IDEA: XBRL DOCUMENT - INTERNET INFINITY, INC. | Financial_Report.xls |
U.S. 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
OR
[ ] 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. 0-27633
INTERNET INFINITY, INC.
(Exact name of registrant as specified in its charter)
State of Incorporation: Nevada
IRS Employer I.D. Number: 95-4679342
220 Nice Lane #108
Newport Beach, California 92663
Telephone 310-493-2244
(Address and telephone number of registrant’s principal
executive offices and principal place of business)
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 twelve 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 is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
Large accelerated filer | [ ] | Accelerated filer | [ ] | Non-accelerated filer | [ ] | Smaller reporting company | [X] |
As of February 5, 2013, there were 28,718,780 shares of the Registrant’s Common Stock, par value $0.001 per share, outstanding.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes [ ] No [X]
Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]
TABLE OF CONTENTS
2 |
PART I – FINANCIAL INFORMATION
INTERNET INFINITY INC. |
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Balance Sheet |
as at December 31, 2012 (unaudited) and March 31, 2012 |
December 31, 2012 | March 31, 2012 | |||||||
(Unaudited) | ||||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 825 | $ | 4,188 | ||||
Accounts Receivable | 3,000 | 2,500 | ||||||
Total Current Assets | 3,825 | 6,688 | ||||||
TOTAL ASSETS | 3,825 | 6,688 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
Liabilities | ||||||||
Current Liabilities | ||||||||
Accounts Payable and Accrued Expenses | $ | 7,851 | $ | 7,851 | ||||
Notes Payable - Related Parties | 59,575 | 659,982 | ||||||
Due to Officer | 680,119 | 367,561 | ||||||
Total Current Liabilities | 747,545 | 1,035,394 | ||||||
Stockholders’ Equity (Deficit) | ||||||||
Preferred Stock, $0.001 par value, 30,000,000 shares authorized, none issued and outstanding at March 31, 2012 and December 31,2012 | - | - | ||||||
Common Stock, $0.001 par value, 100,000,000 shares authorized, 33,718,780 shares issued and outstanding as at December 31, 2012 28,718,780 shares issued and outstanding as at March 31, 2012 | 33,719 | 28,719 | ||||||
Additional Paid-in Capital | 1,459,743 | 1,161,140 | ||||||
Accumulated Deficit | (2,237,182 | ) | (2,218,565 | ) | ||||
Total Stockholders’ Equity (Deficit) | (743,720 | ) | (1,028,706 | ) | ||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | $ | 3,825 | $ | 6,688 |
F-1 |
INTERNET INFINITY INC. |
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Statement of Operations |
for the Three and Nine Month Periods Ended December 31, 2012 and 2011 |
(Unaudited) |
For the 3 months ended December 31 | For the 9 months ended December 31, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Revenue | $ | 4,250 | $ | - | $ | 10,750 | $ | 5,000 | ||||||||
Cost of Revenue | - | - | - | - | ||||||||||||
Gross Profit | 4,250 | - | 10,750 | 5,000 | ||||||||||||
Operating Expenses: | ||||||||||||||||
Professional Fees | 400 | 150 | 4,747 | 4,509 | ||||||||||||
Consulting | 645 | |||||||||||||||
Other | 333 | 411 | 866 | 888 | ||||||||||||
Total Operating Expenses | 733 | 561 | 5,613 | 6,042 | ||||||||||||
Loss from operations | 3,517 | (561 | ) | 5,137 | (1,042 | ) | ||||||||||
Non-operating income (expense) | ||||||||||||||||
Interest expense | (4,147 | ) | (11,378 | ) | (23,754 | ) | (31,992 | ) | ||||||||
Total other expense | (4,147 | ) | (11,378 | ) | (23,754 | ) | (31,992 | ) | ||||||||
Loss before income taxes | (630 | ) | (11,939 | ) | (18,617 | ) | (33,034 | ) | ||||||||
Provision for income taxes | - | - | - | - | ||||||||||||
Net Loss | $ | (630 | ) | $ | (11,939 | ) | $ | (18,617 | ) | $ | (33,034 | ) | ||||
Basic and diluted net loss per common share | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | ||||
Basic and diluted weighted average number of common shares outstanding | 33,718,780 | 28,718,780 | 33,718,780 | 28,718,780 |
F-2 |
INTERNET INFINITY INC. |
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Statement of Cash Flows |
for the nine months ended December 31, 2012 and 2011 |
(Unaudited) |
2012 | 2011 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (18,617 | ) | $ | (33,034 | ) | ||
Adjustments to reconcile net loss to net cash used by operating activities: | - | - | ||||||
Change in operating assets and liabilities: | ||||||||
Accounts Receivable | (500 | ) | (5,000 | ) | ||||
Accounts payable | 5,244 | |||||||
Accrued Interest | 23,754 | |||||||
Net cash (used by) operating activities | 4,637 | (32,790 | ) | |||||
Cash flows from investing activities | ||||||||
Net cash (used by) investing activities | - | - | ||||||
Cash flows from financing activities: | ||||||||
Increase (decrease) in due to related party | 25,133 | |||||||
Increase (decrease) in due to officer | (8,000 | ) | 8,174 | |||||
Net cash provided by financing activities | (8,000 | ) | 33,307 | |||||
Net increase (decrease) in cash | (3,363 | ) | 517 | |||||
Cash, beginning of the period | 4,188 | 432 | ||||||
Cash, end of the period | $ | 825 | $ | 949 | ||||
Supplemental cash flow disclosure: | ||||||||
Interest paid during the year | $ | - | $ | - | ||||
Taxes paid during the year | $ | - | $ | - | ||||
Non Cash Investing and Financing Activities: | ||||||||
Debt contributed, cancelled | 53,603 | - | ||||||
Stock issued in cancellation of debt | 250,000 | - | ||||||
303,603 | - |
F-3 |
INTERNET INFINITY, INC.
NOTES TO FINANCIAL STATEMENTS
December 30, 2012
NOTE 1 | ORGANIZATION |
Internet Infinity, Inc. (III or “the Company”) was incorporated in the State of Delaware on October 27, 1995. III was in the business of distribution of electronic media duplication services and electronic blank media. The Company was re-incorporated in Nevada on December 17, 2004. The Company chose March 31 as its fiscal year end. The Company is currently seeking an acquisition or merger to redirect the structure and management to new profitable activities.
NOTE 2 | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Unaudited Interim Financial Statements
The accompanying unaudited financial statements have been prepared by the Company, pursuant to the rules and regulations of the Securities Exchange commission (the “SEC”) as applicable to smaller reporting companies, and generally accepted accounting principles for interim accounting reporting. The information furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments) which are, in the opinion of management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures normally presented in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been omitted pursuant to such rules and regulations. These unaudited condensed financial statements should be read in conjunction with the audited financial statements and footnotes included in the Company’s Annual Report on Form 10-K. The results of the nine month period ended December 31, 2012 are not necessarily indicative of the results to be expected for the full year ending March 31, 2013.
Cash and cash equivalents
The Company considers all liquid investments with a maturity of six months or less from the date of purchase that are readily convertible into cash to be 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 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 reporting period. Actual results could differ from those estimates.
F-4 |
Fair value of financial instruments
The Financial Accounting Standards Board issued ASC (Accounting Standards Codification) 820-10 (SFAS No. 157), “Fair Value
Measurements and Disclosures” for financial assets and liabilities. ASC 820-10 provides a framework for measuring fair value
and requires expanded disclosures regarding fair value measurements. FASB ASC 820-10 defines fair value as the price that would
be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market
in an orderly transaction between market participants on the measurement date. FASB ASC 820-10 also establishes a fair value hierarchy
which requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels
of inputs required by the standard that the Company uses to measure fair value:
● | Level 1: Quoted prices in active markets for identical assets or liabilities. |
● | Level 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities. |
● | Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. |
The carrying amounts of the Company’s financial instruments as of December 31, 2012, reflect:
● | Cash: Level One measurement based on bank reporting. |
● | Notes payable to Officers and related parties: Level 2 based on observable inputs. |
Income taxes
The Company utilizes FASB ACS 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.
The Company generated a deferred tax credit through net operating loss carry-forward. However, a valuation allowance of 100% has been established. Net operating loss of approximately $2,237,000 is available through the year 2032, unless first utilized.
Interest and penalties on tax deficiencies recognized in accordance with ASC accounting standards are classified as income taxes in accordance with ASC Topic 740-10-50-19.
Basic and Diluted Earnings Per Share
Net loss per share is calculated in accordance with FASB ASC 260, Earnings Per Share, for the period presented. Basic net loss per share is based upon the weighted average number of common shares outstanding. Diluted net loss per share is based on the assumption that all dilative convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period.
The Company has no potentially dilutive securities outstanding as of December 31, 2012.
F-5 |
Recent Accounting Pronouncements
A variety of proposed or otherwise potential accounting standards are currently under study by standard setting organizations and various regulatory agencies. Due to the tentative and preliminary nature of those proposed standards, the Company’s management has not determined whether implementation of such standards would be material to its financial statements.
Going Concern
The Company’s financial statements are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has incurred significant losses and has an accumulated deficit of $2,237,182 and its total liability exceeds its assets by $743,720. The Company incurred net losses of $(18,617) and $(33,034) for the nine months ended December 31, 2012 and 2011, respectively.
In view of the matters described above, recoverability of a major portion of the recorded asset amounts shown in the accompanying balance sheets is dependent upon continued operations of the Company, which in turn is dependent upon the Company’s ability to raise additional capital, obtain financing and to succeed in its future operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Management has taken the following steps to revise its operating and financial requirements, which it believes are sufficient to provide the Company with the ability to continue as a going concern. The Company is actively pursuing additional funding and potential merger or acquisition candidates to redirect the structure and management to new profitable activities. The Company is also seeking strategic partners, which would enhance stockholders’ investment. Management believes that the above actions will allow the Company to continue operations through the next fiscal year.
NOTE 3 | RELATED PARTIES TRANSACTIONS |
Company President
George Morris is President, Chief Financial Officer, Vice President, the Chairman of the Board of directors of the Company and the controlling shareholder of the Company and its related parties through his beneficial ownership of the following percentages of the outstanding voting shares of the related parties:
Morris Business Development Company (the Company). | 94.8 | % | |
Apple Realty, Inc. | 100.00 | % | |
Internet Infinity Inc. | 85.06 | % | |
L&M Media | 100.00 | % |
F-6 |
Stock Issued to Related Party
On June 30, 2012, 5,000,000 shares of common stock were issued to the President, George Morris, in payment for a reduction in officer loan of $250,000.
Notes Payable to Related Parties
The Company has notes payable to related parties on December 31, 2012 as follows:
Due to Related Parties | 7,209 | |||
The Company has payables to Morris Business Development Company and Morris & Associates, Inc., two parties related through a common controlling shareholder. The amounts are interest free, unsecured and due on demand. | ||||
L&M Media, Inc. (related through a common controlling shareholder) – Accounts payable for purchases, converted into a note. The note is due on demand, unsecured and interest accrues at 6% per annum. | $ | 29,466 | ||
Accumulated interest thereon | 22,900 | |||
Total Notes Payable – Related Parties | 59,575 |
Due to Officer
The Company has notes payable to the President of the Company on December 31, 2012 as follows:
George Morris. The note payable to Anna Moras (mother of George Morris) of $400,000 was transferred to the President, George Morris, on June 30, 2012. The interest rate was reduced from 6% to 0% and $150,000 of accrued interest payable was transferred to George Morris. Transferred Note Payable | $ | 400,000 | ||
Due to Officer The amount is interest free, unsecured and due on demand. | 190.352 | |||
Interest thereon | 99,767 | |||
Total Due to Officer | 680,119 |
F-7 |
During the nine months ended December 31, 2012, the Company’s officers and directors did not charge for their services.
The Company utilizes office space, telephone and utilities provided by Apple Realty, Inc., a company owned by the President, at estimated fair market values, as follows:
Monthly | Annually | |||||||
Rent | $ | 100 | $ | 1,200 | ||||
Telephone | 100 | 1,200 | ||||||
Utilities | 100 | 1,200 | ||||||
Office Expense | 100 | 1,200 | ||||||
Total | $ | 400 | $ | 4,800 |
The Company has a month-to-month agreements with Apple Realty, Inc. for a total monthly fee of $400 for the above expenses. The charges are currently in abeyance.
NOTE 4 | INCOME TAXES |
No provision was made for federal income tax for the nine months ended December 31 2012, since the Company had significant net operating loss. The net operating loss carry-forward may be used to reduce taxable income through the year 2032. The availability of the Company’s net operating loss carry-forwards are subject to limitation if there is a 50% or more positive change in the ownership of the Company’s stock. The provision for income taxes consists of the state minimum tax imposed on corporations.
NOTE 5 | STOCK OPTIONS |
The Company’s 1996 stock option plan provides that incentive stock options and nonqualified stock options to purchase common stock may be granted to directors, officers, key employees, consultants, and subsidiaries with an exercise price of up to 110% of market price at the date of grant. Generally, options are exercisable one or two years from the date of grant and expire three to ten years from the date of grant.
For the nine months ended December 31, 2012, the Company granted no options. As at December 31, 2012 there are no options outstanding.
NOTE 6 | CAPITAL |
During the nine months ended December 31, 2012, the Company issued stock as follows:
On June 30, 2012, 5,000,000 restricted common shares in return for a $250,000 reduction of officer loan.
As of December 31, 2012 the Company had authorized 30,000,000 preferred shares of par value $0.001, of which none were issued and outstanding. The Company had authorized 100,000,000 shares of common stock of par value $0.001, of which 33,718,780 shares were issued and outstanding.
F-8 |
Item 2. Management’s Discussion and Analysis or Plan of Operation
The following discussion and analysis should be read in conjunction with the financial statements and the accompanying notes thereto for the three-month period ended December 31, 2012 and is qualified in its entirety by the foregoing and by more detailed financial information appearing elsewhere. See “Item 1. Financial Statements.” The discussion includes management’s expectations for the future.
Results of Operations – Third Quarter (“Q3”) Fiscal 2012 Compared to Third Quarter (“Q3”) Fiscal 2011.
Revenue
Internet Infinity revenues for Q3 2012 were $4,250 as compared with revenues of $0 in Q3 2011.
Cost of Sales - Gross Margin
Our cost of sales was $0 for Q3 2012, as compared to $0 for Q3 2011
Operating Expenses
Operating expenses for Q3 2012 increased to $733 from $561 for Q3 2011. This increase in operating expenses is primarily due to higher accounting and government reporting costs.
Net Income (Loss)
The company had a net income of $3,517 from operations in Q3 2012, as compared with a net loss of $561 from operations for Q3 2011. Our main expense was interest expense of $4,147 paid for Q3 2012 compared to $11,378 for Q3 of 2011.
Balance Sheet Items
Our cash position decreased to $825 at December 31.,2011 from $949 at December 31,2011.
Off-Balance Sheet Arrangements
Our company has not entered into any transaction agreement with an entity unconsolidated with us under which we have obligations beyond the mutual development of the new eCommerce Association for mutual future benefit, or:
● | a retained or contingent interest in assets transferred to the unconsolidated entity or similar arrangement that serves as credit, liquidity or market risk support to such entity for such assets, |
● | any obligation, including a contingent obligation, under a contract that would be accounted for as a derivative instrument, or |
● | any obligation, including a contingent obligation, arising out of a variable interest in an unconsolidated entity that is held by us and material to us where such entity provides financing, liquidity, market risk or credit risk support to, or engages in leasing, hedging or research and development services with us. |
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Item 4. Controls and Procedures
Evaluation of disclosure controls and procedures. The Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective and are designed to provide reasonable assurances of achieving their objectives. Further, the Company’s officers concluded that its disclosure controls and procedures are also effective to ensure that information required to be disclosed in the reports that it files or submits under the Exchange Act is accumulated and communicated to its management, including its chief executive officer and chief financial officer, to allow timely decisions regarding required disclosure. There were no significant changes in the Company’s internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect our internal controls over financial reporting.
We are not, and none of our property is, a party to any pending legal proceedings, and no such proceedings are known to be contemplated.
No director, officer or affiliate of the company, and no owner of record or beneficial owner of more than 5.0% of the securities of the company, or any associate of any such director, officer or security holder is a party adverse to the company or has a material interest adverse to the Company in reference to any litigation.
Change of Director – find the SEC folder
File the 8K also
2.3 | Articles of Merger (Pursuant to NRS 92A.200) which merges Internet Infinity, Inc., a Delaware corporation, with Internet Infinity, Inc., a Nevada corporation, with the Nevada corporation being the surviving entity*** | |
3 | Articles of Incorporation of Internet Infinity, Inc.* | |
3.1 | Amended Certificate of Incorporation of Internet Infinity, Inc.* | |
3.2 | Bylaws of Internet Infinity, Inc.* | |
3.3 | Corporate Charter and Articles of Incorporation of Internet Infinity, Inc., a Nevada corporation*** | |
3.4 | Certificate of Amendment to Articles of Incorporation of Internet Infinity, Inc., a Nevada corporation++ | |
10.1 | Master License and non-exclusive Distribution Agreement between Internet Infinity, Inc. and Lord & Morris Productions, Inc.* | |
10.2 | Master License and Exclusive Distribution Agreement between L&M Media, Inc. and Internet Infinity, Inc.* | |
10.3 | Master License and Exclusive Distribution Agreement between Hollywood Riviera Studios and Internet Infinity, Inc.* | |
10.4 | Fulfillment Supply Agreement between Internet Infinity, Inc. and Ingram Book Company** | |
14 | Code of Ethics for CEO and Senior Financial Officers+ | |
31.1 | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2 | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1 | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
32.2 | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
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 Presentation Linkbase |
*Previously filed with Form 10-SB 10-13-99; Commission File No. 0-27633 incorporated herein.
**Previously filed with Amendment No. 2 to Form 10-SB 02-08-00; Commission File No. 0-27633 incorporated herein.
***Previously filed with Form 8-K Current Report March 14, 2005, Commission File No. 0-27633 incorporated herein.
+Previously filed with Form 10-KSB; Commission File No. 0-27633 incorporated herein.
++Previously filed with Form 8-K Current Report February 17, 2006; Commission File No. 0-27633 incorporated herein.
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Pursuant to the requirements of the Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
INTERNET INFINITY, INC. | ||
Dated: February 11, 2012 | By: | /s/ Geoge Morris |
George Morris, Chief Executive Officer | ||
INTERNET INFINITY, INC. | ||
Dated: February 11, 2012 | By: | /s/ George Morris |
George Morris, Chief Financial Officer |
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