RegalWorks Media, Inc. - FORM 10-Q

Attached files

file	filename
EXCEL - IDEA: XBRL DOCUMENT - RegalWorks Media, Inc.	Financial_Report.xls
EX-31.1 - CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER - RegalWorks Media, Inc.	exhibit_31-1.htm
EX-32.1 - CERTIFICATION PURSUANT TO 18 U.S.C. 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 - RegalWorks Media, Inc.	exhibit_32-1.htm

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

[mark one]

x QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the quarterly period ended: March 31, 2013

o TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the transition period from ___________ to ____________

Commission File Number: 000-52846

AMERELITE SOLUTIONS, INC.

(Name of small business issuer in its Charter)

Nevada	76-0766174
(State or other jurisdiction of	(I.R.S. Employer
Incorporation or organization)	Identification No.)

3122 W. Clarendon Ave. Phoenix, AZ 85017

(Address of Principal Executive Offices)

602-233-0540

(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.

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

Large Accelerated filer	o	Accelerated Filer	o

Non-accelerated filer	o	Smaller Reporting Company	x
(Do not check if smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2) of the Exchange Act.

Yes o No x

As of May 1, 2013 the registrant had 22,821,688 shares of its common stock, $0.001 par value, issued and outstanding.

AmerElite Solutions, Inc.

(A Development Stage Company)

Table of Contents

		Page

Part I - Financial Information

Item 1.	Financial Statements	3

	Balance Sheets as of March 31, 2013 (Unaudited) and December 31, 2012 (Audited)	3

	Statements of Operations (Unaudited) for the Three Months Ended March 31, 2013 and 2012, and for the period July 26, 1994 (Inception) through March 31, 2013 (Unaudited)	4

	Statements of Cash Flows (Unaudited) for the Three Months Ended March 31, 2013 and 2012, and for the period July 26, 1994 (Inception) through March 31, 2013 (Unaudited)	5

	Notes to Financial Statements (Unaudited)	6

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	9

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	12

Item 4.	Controls and Procedures	12

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.	Submission of Matters to a Vote of Security Holders	14

Item 5.	Other Information	14

Item 6.	Exhibits	14

Signatures		14

Part I – Financial Statements

ITEM 1. FINANCIAL INFORMATION

AmerElite Solutions, Inc.

(A Development Stage Company)

Balance Sheets


	March 31			December 31,
	2013			2012
	(Unaudited)			Audited
ASSETS

Current Assets:
Cash and Cash Equivalents	$	2,837		$	561

Total Current Assets		2,837			561

Other Assets:
Deposits		-			1,135

Total Assets	$	2,837		$	1,696

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
Accounts Payable	$	52,400		$	37,491
Accrued Interest Payable		5,246			4,015
Notes Payable (Note 4)		256,775			249,775

Total Current Liabilities		314,420			291,281

Total Liabilities		314,420			291,281

Stockholders' Equity/(Deficit): (Note 5)



Preferred Stock, Par Value $0.001 per share; authorized
10,000,000 issued and outstanding -0-		-0-			0



Common Stock, Par Value $0.001 per share		22,929			22,929
authorized 100,000,000
issued and outstanding 22,928,688

Additional Paid-in Capital		2,980,069			2,980,069
Accumulated Deficit during Development Stage		(3,314,582	)		(3,292,583	)

Total Stockholders' Equity/(Deficit)		(311,584	)		(289,585	)

Total Liabilities and Stockholders' Equity	$	2,837		$	1,696


The accompanying notes are an integral part of these statements

AmerElite Solutions, Inc.

(A Development Stage Company)

Statements of Operations

								July 26, 1994
		Three Months Ended			Three Months Ended			(Inception)
		March 31			March 31			to March 31,
		2013			2012			2013


Revenue			0			0			21,759

	Total Revenue		0			0			21,759

Cost of Goods Sold			0			0			5,320

Gross Profit			0			0			16,439

Operating Expenses
	Salaries and Wages								1,059,698
	General and Administrative		3,356			635			841,639
	Professional and Consulting		17,361			5,260			620,789
	Product Development								84,851
	Marketing								289,551
	Investor Relations								465,672

			20,717			5,895			3,362,200

(Loss) from Operations			(20,717	)		(5,895	)		(3,345,761	)

Other Income/(Expense)
	Other Income								4,519
	Interest Income								45,173
	Interest Expense		1,231						(18,463	)

	Total Other Income/(Expense)		-						31,229

Net Income/(Loss) Before Income Taxes			(21,948	)		(5,895	)		(3,314,532	)
	Income Tax Expense		(50	)					(50	)

Net Income(Loss)			(21,998	)		(5,895	)		(3,314,582	)

Basic (Loss) per Share			(0.001127	)		(0.000398	)

Weighted Average Number of Common Shares			19,521,379			14,810,088



	The accompanying notes are an integral part of these statements

AmerElite Solutions, Inc.

(A Development Stage Company)

Statements of Cash Flows

								July 26, 1994
		Three Months Ended			Three Months Ended			(Inception)
		March 31			March 31			to March 31
		2013			2012			2013
Operating Activities
	Net Loss		(21,998	)		(5,895	)		(3,314,582	)
	Adjustments to reconcile Net Loss:
	Stock Issued for Services		-			0			1,598,593
	Depreciation and Amortization					-			20,441
	Changes in Operating Assets and Liabilities
	(Increase)/Decrease in Deposits		1,135			-			-
	Increase/(Decrease) in Accounts Payable		14,908			(2,058	)		1,067,366
	Increase/(Decrease) in Accrued Liabilities		1,231			0			75,245
	Write Offs		0			0			353,248

	Net Cash (Used) by Operating Activities		(4,724	)		(7,953	)		(199,688	)

Investment Activities
	Investment in Trademarks and Trade Names		0			0			(13,729	)
	Purchase of Equipment		0			0			(20,441	)

	Net Cash (Used) by Investment Activities								(34,170	)

Financing Activities
	Pre-Paid Expenses
	Proceeds from Loans		7,000			8,275			342,386
	(Repayment) of Loans		0			0			(366,563	)
	Proceeds from the Sale of Stock		0			0			260,872

	Net Cash Provided by Financing Activities		7,000			8,275			236,695

Net Increase / (Decrease) in Cash			2,276			322			2,837

Cash, Beginning of Period			561			610			-

Cash, End of Period			2,837			932			2,837

Supplemental Information:
	Interest Paid		0			0			13,217
	Income Taxes Paid		0			0			0

Significant Non-Cash Transactions:
	Stock issued to Convert Debt								616,132
	Paid in Capital - Debt Relief								82,031
	Stock Issued to Acquire Assets					0			400,000
	Stock Issued for Services					0			3,006
	Notes Issued for Accounts Payable					0			230,000


	The accompanying notes are an integral part of these statements

AMERELITE SOLUTIONS, INC.

(A Development Stage Company)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

March 31, 2013

NOTE 1 GENERAL ORGANIZATION AND BUSINESS

AmerElite Solutions, Inc. (the Company) was incorporated in the state of Nevada July 26, 1994 as ABC Home Care Specialists, Inc., and on May 18, 2005 changed its name to AmerElite Solutions, Inc. The Company is in the business of marketing and distributing skin care products.

NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Use of Estimates and Assumptions

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 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.

Financial Instruments

The carrying values of the Company’s financial instruments as reported in the accompanying balance sheets, approximates fair value.

Accounting Basis

These financial statements are prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents.

Earnings (loss) per share

The net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of shares of common outstanding. Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any), are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share.

Furniture and equipment

The cost of furniture, equipment and computer hardware and software is depreciated over the estimated useful lives of the related assets. The Company’s furniture and equipment as of March 31, 2013 has been fully depreciated and has no value and has not been shown on the Balance Sheet.

AMERELITE SOLUTIONS, INC.

(A Development Stage Company)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

March 31, 2013

NOTE 2. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

Long Lived Assets

In accordance with ASC350, the Company regularly reviews the carrying value of intangible and other long-lived assets for the existence of facts or circumstances, both internally and externally, that may suggest impairment. If impairment testing indicates a lack of recoverability, an impairment loss is recognized by the Company, if the carrying amount of a long-lived asset exceeds its fair value.

Income tax

The Company accounts for income taxes pursuant to ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

At March 31, 2013 the Company had net operating loss carry-forwards of approximately $3,396,402 which begin to expire in 2014. The deferred tax asset of approximately $1,188,741 created by the net operating losses have been offset by a 100% valuation allowance.

Revenue and Cost Recognition

The Company recognizes revenue from product sales upon shipment, which is the point in time when risk of loss is transferred to the customer, net of estimated returns and allowances.

Stock Based Compensation

The Company accounts for employee and non-employee stock awards under ASC 718, whereby equity instruments issued to employees for services are recorded based on the fair value of the instrument issued and those issued to non-employees are recorded based on the value of the consideration received or the fair value of the equity instrument, whichever is more reliably measurable.

Advertising

The Company follows the policy of charging the costs of advertising to expense as incurred. The Company incurred no advertising costs during the three months ending March 31, 2013

NOTE 3. GOING CONCERN

The Company has suffered recurring losses from operations and has a working capital deficit and stockholders’ deficit and in all likelihood will be required to make significant future expenses in connection with continuing marketing efforts along with general administrative expenses. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The Company may raise additional capital through the sale of its equity securities, through an offering of debt securities, or through borrowing from financial institutions. By doing so, the Company hopes through increased marketing efforts to generate greater revenues from sales of its skin care products. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern.

AMERELITE SOLUTIONS, INC.

(A Development Stage Company)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

March 31, 2013

NOTE 4. NOTES PAYABLE

The following is a summary of Notes Payable at March 31, 2013:

2% Notes Payable to unaffiliated third parties, due on demand, with interest payable quarterly	$	256,775

	$	256,775

Accrued interest payable in the amount of $5,245is recorded at March 31, 2013 with interest expense attributable of $1,232 for the three months ending March 31, 2013.

In July 2012 the Directors authorized the Company and in September 2012 the Company converted $230,000 in accounts payable due to the Officers and Directors into two demand notes payable. The Company recognized no beneficial conversion feature expense on the notes. Also in September 2012, the notes were acquired by an unaffiliated third party and consolidated into one note, with the holder having the right for twelve months to convert the note into common stock at $.005, or 46,000,000 total common shares, which was considered to be the Company’s current fair market value. As of March 31, 2013 the holder has not exercised the conversion of the note.

NOTE 5. STOCKHOLDERS’ EQUITY

NOTE 6. SUBSEQUENT EVENTS:

On April 2, 2013 the Company received $10,000 from RWMI to extend the binding Letter of Intent (LOI) referred to in Note 5 until April 30, 2013. The LOI also states, if by such date the Closing has not occurred, the Parties may mutually extend the Closing date for an additional 15 days for an additional fee of $25,000 to be paid to the Company.

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

The following discussion is a discussion and analysis of our financial condition and results of operations for the three months ended March 31, 2013 and significant factors that could affect our prospective financial condition and results of operations. Historical results may not be indicative of future performance.

This report on Form 10-Q contains forward-looking statements within the meaning of and which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to be materially different from historical results or from any results expressed or implied by such forward-looking statements. Forward-looking statements generally are accompanied by words such as “anticipates”, “believes”, “estimates”, “expects”, “intends”, “plans” and similar statements and should be considered uncertain and forward-looking. Any forward-looking statements speak only as of the date on which such statement is made, are not guarantees of future performance and involve certain risks, uncertainties, and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements, whether as a result of new information, future events or otherwise.

Factors that could cause such results to differ materially from the results discussed in such forward looking statements include, without limitation; uncertain continued ability to meet our operational needs in view of continued severe ongoing working capital constraints; need for substantial additional capital to fully implement our plan of operations; no assurances of and uncertainty of profitability; no assurances of the Company’s ability to effect sufficient product sales so as to maintain exclusivity in certain territorial markets, the result of which could materially adversely affect the Company’s results of operations; need for additional management, sales and marketing personnel, which is contingent upon our receipt of additional capital; competition from companies having substantially greater financial, marketing and other resources than the Company, including name and brand recognition; the impact of competitive services and pricing; changing consumer tastes and trends; and the legal, auditing and administrative cost of compliance associated the Sarbanes Oxley Act.

Many of such factors are beyond our control. New factors emerge from time to time and it is not possible for management to predict all of such factors, nor can it assess the impact of each factor on our business or the extent to which any factor, or combination of factors may cause actual results to differ materially from those contained in any forward looking statements. In light of these risks and uncertainties, there can be no assurance that the results anticipated in these forward-looking statements in this report will in fact occur. All forward-looking statements wherever they may appear are expressly qualified in their entirety by the cautionary statements in this section. We undertake no obligation to update any such forward-looking statements.

Overview

AmerElite Solutions, Inc. is a development stage company with limited operations and revenues to date, limited financial backing and its assets are predominately intangible. The current stage of our Business Plan is to establish ourselves as a company that has developed and manufactured and is attempting to obtain financing so that it can market and sell the Collesense™ Premium Skin Care Collection. Distribution will initially be based on direct response and Internet based advertising campaign. As a follow up, we plan to introduce Collesense™ on a kiosk program in high traffic, regional shopping centers across the country. We are planning to target the rapidly growing baby boomers generation offering a full spectrum of skin care products designed to naturally improve skin wellness and provide anti-aging properties. These markets continue to expand with double-digit annual growth.

As of March 31, 2013, the Company’s outstanding Notes Payable balance was $256,775 along with Accrued Interest of $5,246. The Company’s Accounts Payable balance as of March 31, 2013 was $52,400. Currently, the Company has an average of $2,500 per month in cash expenditures that it cannot accrue or pay in the form of equity. The Company’s President has made arrangements to borrow these funds on an interim basis until the Company can obtain funds to capitalize itself.

During the first stages of AmerElite’s growth, our officers and directors will provide the majority of all the labor required to execute our business plan. The officers, directors and a key consultant have agreed to take the company’s restricted common stock in lieu of any monetary compensation. Since we intend to operate with very limited administrative support, the officers and directors have decided to work with industry experts in order to produce and market our direct-response advertisements and Internet sales sites. In order to fully execute the business management will need to hire 2-3 part time workers to handle order confirmation, customer support and accounting.

During the first year of operations, we will rely on third party’s to properly analyze and select the necessary time slots, channels and regions in which to air our short and long form advertising. In addition, we will contract with an outside expert to develop a comprehensive Internet eStrategy to capitalize of one of the fastest growing channels for cosmetic products. At present, we have no plans to market our products outside of the United States.

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

In May 2005 AmerElite Solutions, Inc. purchased our intellectual property – the anti-aging ingredient we have named Collamin_G®. This ingredient became the basis for our first product Serum_G®. We conducted two separate studies to determine the efficacy of our anti-aging serum. Over half of the participants volunteered to have before and after photos taken over the test period. Participants in each of the studies were asked to fill out a subjective questionnaire daily in which they answered questions and were encouraged to write additional comments regarding the effects that resulted from using Serum_G® twice a day.

After the first two test groups completed their test period and the results were analyzed we contracted with a manufacturing firm based in Phoenix, AZ to produce a full line of skin care products. An initial set of samples was produced in order to obtain feedback on the quality of each product. We commissioned several focus groups comprised of cosmetologists, aestheticians and consumers. Each of the individuals was presented product samples and then asked to evaluate and respond to the following:

Absorption

Fragrance

Texture

Color

The results of both the Serum_G® test and of the focus groups were valuable and overwhelmingly positive. The study of the absorption of Serum_G® and the instant and lasting effect of Serum_G® on the appearance of fine lines and wrinkles showed encouraging results. These positive responses have had a direct effect on the message that we are conveying to our target market. The before and after photos that were taken are not retouched and show a significant improvement in the skin around the eyes. These photos have also been used in our marketing materials, and promotional videos. Several participants have given testimonials as to the results of using Serum_G® and have signed affidavits verifying the validity of such statements.

In January of 2007 we manufactured 6 products for our Collesense™ Premium Skin Care Collection. In February of 2007 we opened a kiosk in a local regional shopping center to run a market test and gain additional feedback regarding the products and price points. In March of 2007 we contracted with a local company to run short features on Saturday mornings on a local TV station. We ran four different offers featuring various combinations of Collesense™ products at four different price points.

Based on input from industry professionals, management continues to review several alternative names for a product line that will consist of the same 6 products that made up the Collesense™ Premium Skin Care Collection. This new product line will be manufactured and packaged for both the domestic and international markets with labeling consistent with the domestic and international market that it is intended for.

During the quarter ended September 30, 2012 we have continued to implement the following steps of our business plan:

Conducted research on new products and packaging

Explored opportunities with other companies to distribute our product through a private label program

Met with public relation firms

Meeting with representatives of e-commerce firms in order to market our product

We are a startup business engaged in the development, manufacturing and marketing of a premium skin care collection designed to provide a full spectrum of skin care products that naturally improve skin wellness and provide anti-aging properties to a rapidly expanding health and wellness market.

We have earned no revenues in 2012 from our business operations. Accordingly, we may be required to raise cash from sources other than our operations in order to continue our business plan. We may raise this additional capital either through debt or equity. No assurance can be given that such efforts will be successful. We have no specific plans at present for raising additional capital.

Since our inception, we have been engaged in business planning activities, including the launch of our product line, product research with professional focus groups, production of an infomercial, launch of a e-commerce website, developing our economic models and financial forecasts.

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

Results of Operations:

Three Months Ended March 31, 2013 and March 31, 2012

During the three months ended March 31, 2013 we generated $0 in revenue compared to revenues of $0 for the same period ended March 31, 2012. Net loss for the three months ended March 31, 2013 was $20,717 compared to a net loss of $5,895 for the same period ended March 31, 2012. , This loss for the three months ended March 31, 2013 was primarily attributable to continued administrative expenses, professional and consulting fees related to our efforts to the continued pursuit of our business plan.

For the three months ended March 31, 2013 we had no retail sales of our Collesense™ Premium Skin Care Collection. The Company needs working capital/financing in order to restart the manufacture of its product. Total Operating Expenses for the three months ended March 31, 2013 was 20,717. The increase in Operating Expenses for the three months ended March 31, 2013 was attributable to an increase in consulting fees and expenses incurred. With Gross Profit of $0 and Operating Expenses totaling $20,717, the Company had a loss from operations for the three months ended March 31, 2013 of $20,717.

Liquidity and Capital Resources:

At March 31, 2013, the Company’s current assets of $2,837, exceeded by current liabilities of $314,420 created negative working capital of $311,584. The Company at March 31, 2013 had cash on hand of $2,837.

On March 15, 2013 the Company executed a binding Letter of Intent to acquire RegalWorks Media, Inc. (RWMI). The Company, upon completion of the acquisition, will change its name to RegalWorks Media, Inc. RWMI is building an integrated media holding company for today’s media entertainment environment. The Letter of Intent requires the issuer to tender all outstanding obligations prior to closing, and affect a reverse stock split of the Company’s common stock at a ratio of 25 to 1 or such other ratio as deemed suitable by both parties. The Company may have as many as 70,000,000 shares of common stock issued and outstanding prior to the reverse stock split. The transaction will take the form of a “reverse acquisition” with the owners of RWMI initially controlling 80% of the outstanding stock of the Company in a tax free exchange and with RWMI’s executive team replacing the Company’s officers and directors. The Company is selling shares of its common stock and preferred stock in exchange for 100%of the RWMI issued and outstanding common stock. The number of shares to be issued to RWMI is 11,200,000 shares of common stock and 5,600,000 of preferred stock. The 5,600,000 shares of convertible preferred stock issued will be held in escrow until satisfaction of certain post-closing conditions on goals of performance by the new RWMI executive team are achieved. As consideration for the issued shares as payment for the company shares, buyers shall deposit with escrow agent the sum of $105,000 as payment towards the purchase price for the purchase and reorganization of the Company. The escrowed funds will primarily be used to extinguish sellers accounts payable and notes payable. On April 30, 2013 the parties agreed to extend a no-shop deadline to May 15, 2013. RWMI will pay a non-refundable payment of $25,000 to the Company. The transaction is subject to a number of conditions precedent, including satisfactory completion of due diligence, completion and execution of definitive documentation, and approval of the Company’s shareholders and Board of Directors and other conditions. There can be no assurance that all conditions will be satisfied or that, if satisfied the transaction will close.

We have limited capital resources, as, among other things, we are a startup company with a limited operating history. We have not generated any revenues for 2012 or for the first three months of 2013, and may not be able to generate sufficient revenues to become profitable in the future. The Company does plan to restart its production of the Collesense™ product line which will produce product for sale. Production is predicated on financing or loans from various parties.

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

Our cash reserves are not sufficient to meet our obligations for the next 12-month period. As a result, we will need to seek additional funding in order to pursue our business plan and restart our production. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of short-term loans or in the form of equity financing from the sale of our common stock or preferred stock on a best efforts basis. We do not have any arrangements in place for either of these financing options. On July 11, 2012 pursuant to a vote of the majority of the shareholders of the Company we effected several changes to our authorized capital which includes par value. Par value for our common stock decreased from $0.00125 to $0.001 per share. Our authorized capital increased from 20,000,000 to 100,000,000 for our common stock and 2,000,000 to 10,000,000 for our preferred stock.

We do not anticipate the need to purchase any equipment in the near future.

We do not anticipate the need to hire any employees prior to the completion of the planned merger with RegalWorks Media Inc.. We believe that our operations are currently on a scale and size that are manageable by one individual, our Chief Executive Officer, Mr. Knapp.

Item 3. Quantitative and Qualitative Disclosure About Market Risk.

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Robert Knapp, the Company's Principal Executive Officer and Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report pursuant to Rule 13a-15e and 15d-15e under the Securities Exchange Act of 1934 (the "Exchange Act") as of March 31, 2013. Disclosure controls and procedures are designed to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized, and reported on a timely basis and that such information is accumulated and communicated to management, including the Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, the Company's Principal Executive Officer and Financial Officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were not effective.

Material Weakness

Internal Controls Over Financial Reporting

In connection with the preparation of our financial statements for the quarter ended March 31, 2013, certain significant deficiencies in internal control became evident to management that represented material weaknesses, including:

i. Lack of an audit committee. We did not have an audit committee who would be charged with the purpose of overseeing the accounting and financial reporting processes of the Company.

ii. Insufficient segregation of duties in our accounting functions and limited personnel. During the year, we had limited staff that performed nearly all aspects of our financial reporting process including, but not limited to access to the underlying accounting records and systems, the ability to record journal entries and responsibility for the preparation of financial statements.

This created certain incompatible duties and a lack of review over the financial reporting process that could likely result in a failure to detect errors in spreadsheets, calculations, or assumptions used to compile the financial statements and related disclosures as filed with the SEC. These control deficiencies could result in a material misstatement to our annual or interim consolidated financial statements that would not be prevented or detected in a timely manner. In addition, our Company's accounting personnel does not have sufficient technical accounting knowledge relating to accounting for complex generally accepted accounting principle matters or SEC derived public reporting and disclosure. Management with assistance of outside professionals has corrected any errors prior to the release of our Company's December 31, 2012 and March 31, 2013 financial statements.

CHANGES IN INTERNAL CONTROLS

During the three months ended March 31, 2013, the Company employed an outside accountant proficient in financial reporting and technical accounting on an ad-hoc hourly basis. As this person is interim to the hiring of a full time accounting professional and familiarity with the Company's accounting and financial reporting processes, management does not believe this material weakness is fully remediated as of March 31, 2013. Thus, management believes that there were no changes in the Company's internal controls over financial reporting that occurred during the three months ended March 31, 2013 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Part II – Other Information

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 1(A). 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. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS AND REPORTS

A. EXHIBITS

Exhibit No.	Description
31.1	Certification of Principal Executive Officer and Principal Financial Officer

32.1	Certification Pursuant to 18 U.S.C. 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

B. REPORTS

None

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.

	AMERELITE SOLUTIONS, INC.

Date: May 10, 2013	By:	/s/ Robert L. Knapp
		Principal Executive Officer and
		Principal Financial Officer

RegalWorks Media, Inc. - FORM 10-Q - May 13, 2013

Attached files

RegalWorks Media, Inc. Reports