Attached files

file filename
EXCEL - IDEA: XBRL DOCUMENT - GENERAL CANNABIS CORPFinancial_Report.xls
EX-32 - EXHIBIT 32.1 - GENERAL CANNABIS CORPf4exhibit321.htm
EX-31 - EXHIBIT 31.1 - GENERAL CANNABIS CORPf2exhibit311.htm
EX-31 - EXHIBIT 31.2 - GENERAL CANNABIS CORPf3exhibit312.htm
EX-32 - EXHIBIT 32.2 - GENERAL CANNABIS CORPf5exhibit322.htm

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 June 30, 2013


¨   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. 000-54457


PROMAP CORPORATION

(Name of registrant in its charter)


Colorado

  

20-8096131

(State or other jurisdiction of incorporation or formation)

   

(I.R.S. employer identification number)


6855 South Havana Street, Suite 400, Centennial, CO 80112

(Address of principal executive offices)

 

(720) 889-0510

(Registrant’s telephone number, including area code) 


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.  x  Yes   ¨  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).  x  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 the definitions 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    ¨

(Do not check if a smaller reporting company)

 

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   x  No


Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.  On July 16, 2013, there were 9,724,200 shares of Common Stock issued and outstanding.





PROMAP CORPORATION

FORM 10-Q


TABLE OF CONTENTS


PART I.  FINANCIAL INFORMATION

 

Page

 

 

 

 

Item 1.

Financial Statements

 

3

 

 

 

 

 

  Balance sheets

 

3

 

  Statements of operations

 

4

 

  Statements of cash flows

 

5

 

  Notes to unaudited consolidated financial statements

 

6-7

 

 

 

 

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

 

8

 

 

 

 

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

 

9

 

 

 

 

Item 4.

Controls and Procedures

 

9

 

 

 

 

PART II.  OTHER INFORMATION

 

10

 

 

 

 

Item 1.

Legal Proceedings

 

10

 

 

 

 

Item 1A.

Risk Factors

 

10

 

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

 

10

 

 

 

 

Item 3.

Defaults Upon Senior Securities

 

10

 

 

 

 

Item 4.

Mine Safety Disclosures

 

10

 

 

 

 

Item 5.

Other Information

 

10

 

 

 

 

Item 6.

Exhibits

 

10

 

 

 

 

 

Signatures

 

11






2



PART I—FINANCIAL INFORMATION


Item 1.  Financial Statements.


PROMAP CORPORATION

BALANCE SHEETS


 

 

December 31,

2012

 

 

June 30,

2013

 

 

 

 

 

 

(Unaudited)

 

  

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

  

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash

 

$

14,981

 

 

$

2,373

 

Accounts receivable (net of allowance for doubtful accounts)

 

 

-

 

 

 

18,576

 

Total current assets

 

 

14,981

 

 

 

20,949

 

  

 

 

 

 

 

 

 

 

Total Assets

 

$

14,981

 

 

$

20,949

 

  

 

 

 

 

 

 

 

 

LIABILITIES & STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accrued payables

 

482

 

 

$

12,305

 

Total current liabilities

 

 

482

 

 

 

12,305

 

  

 

 

 

 

 

 

 

 

Total Liabilities

 

 

482

 

 

 

12,305

 

  

 

 

 

 

 

 

 

 

Stockholders' Equity

 

 

 

 

 

 

 

 

Preferred stock, no par value; 5,000,000 shares authorized; No shares issued & outstanding

 

 

-

 

 

 

-

 

Common stock, no par value;100,000,000 shares authorized; 9,724,200 shares issued and outstanding

 

 

76,050

 

 

 

76,050

 

Additional paid in capital

 

 

24,000

 

 

 

24,000

 

Retained earnings

 

 

(85,551

)

 

 

(91,406

)

  

 

 

 

 

 

 

 

 

Total Stockholders' Equity

 

 

14,499

 

 

 

8,644

 

  

 

 

 

 

 

 

 

 

Total Liabilities and Stockholders' Equity

 

$

14,981

 

 

$

20,949

 


The accompanying notes are an integral part of the financial statements.




3






PROMAP CORPORATION

STATEMENTS OF OPERATIONS

(Unaudited)


 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30,

 

 

June 30,

 

 

 

2012

 

 

2013

 

 

2012

 

 

2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales (net of returns) - related party

 

$

16,393

 

 

$

2,007

 

 

$

19,864

 

 

$

17,779

 

Sales (net of returns)

 

 

-

 

 

 

2,147

 

 

 

1,145

 

 

 

3,732

 

Reserve recovery

 

 

-

 

 

 

-

 

 

 

40,860

 

 

 

-

 

Cost of goods sold

 

 

12,167

 

 

 

7,560

 

 

 

12,484

 

 

 

12,145

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

4,226

 

 

 

(3,406

)

 

 

49,385

 

 

 

9,366

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

 

9,170

 

 

 

6,446

 

 

 

18,692

 

 

 

15,233

 

 

 

 

9,170

 

 

 

6,446

 

 

 

18,692

 

 

 

15,233

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations

 

 

(4,944

)

 

 

(9,852

)

 

 

30,693

 

 

 

(5,867

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

4

 

 

 

-

 

 

 

10

 

 

 

2

 

Other income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

10

 

 

 

 

4

 

 

 

-

 

 

 

10

 

 

 

12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before provision for income taxes

 

 

(4,940

)

 

 

(9,852

)

 

 

30,703

 

 

 

(5,855

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for income tax

 

 

(988

)

 

 

-

 

 

 

6,141

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

(3,952

)

 

$

(9,852

)

 

$

24,562

 

 

$

(5,855

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Basic and fully diluted)

 

$

(0.00

 

$

(0.00

)

 

$

0.00

 

 

$

(0.00

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding

 

 

9,724,200

 

 

 

9,724,200

 

 

 

9,724,200

 

 

 

9,724,200

 


The accompanying notes are an integral part of the financial statements.




4






PROMAP CORPORATION

STATEMENTS OF CASH FLOWS

(Unaudited)


 

 

Six Months Ended

 

 

 

June 30,

 

 

 

2012

 

 

2013

 

  

 

 

 

 

 

 

Cash Flows From Operating Activities:

 

 

 

 

 

 

Net income (loss)

 

$

24,562

 

 

$

(5,855

)

  

 

 

 

 

 

 

 

 

Adjustments to reconcile net loss to net cash provided by (used for)operating activities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(8,225

)

 

 

(18,576

)

Taxes payable

 

 

6,141

 

 

 

-

 

Accrued payables

 

 

7

 

 

 

11,823

 

Net cash provided by (used for)operating activities

 

 

22,485

 

 

 

(12,608

)

  

 

 

 

 

 

 

 

 

Cash Flows From Investing Activities:

 

 

 

 

 

 

 

 

  

 

 

-

 

 

 

-

 

Net cash provided by (used for)investing activities

 

 

-

 

 

 

-

 

  

 

 

 

 

 

 

 

 

Cash Flows From Financing Activities:

 

 

 

 

 

 

 

 

Sales of common stock

 

 

-

 

 

 

-

 

Net cash provided by (used for)financing activities

 

 

-

 

 

 

-

 

  

 

 

 

 

 

 

 

 

Net Increase (Decrease) In Cash

 

 

22,485

 

 

 

(12,608

)

  

 

 

 

 

 

 

 

 

Cash At The Beginning Of The Period

 

 

28,951

 

 

 

14,981

 

  

 

 

 

 

 

 

 

 

Cash At The End Of The Period

 

$

51,436

 

 

$

2,373

 

  

 

 

 

 

 

 

 

 

Schedule Of Non-Cash Investing And Financing Activities

 

 

 

 

 

 

 

 

None

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

 

Supplemental Disclosure

 

 

 

 

 

 

 

 

Cash paid for interest

 

$

-

 

 

$

-

 

Cash paid for income taxes

 

$

-

 

 

$

-

 



The accompanying notes are an integral part of the financial statements.



5



PROMAP CORPORATION

NOTES TO FINANCIAL STATEMENTS

(UNAUDITED)



NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Promap Corporation (the “Company”), was incorporated in the State of Colorado on November 12, 1989. The Company sells oil and gas maps to oil and gas industry businesses.


Basis of Presentation


The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and disclosures required by generally accepted accounting principles for complete financial statements. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of operations for a full year.


Use of Estimates


The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect 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.


Cash and cash equivalents


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


Accounts Receivable


The Company reviews accounts receivable periodically for collectability and establishes an allowance for doubtful accounts and records bad debt expense when deemed necessary.


Property and equipment


Property and equipment are recorded at cost and depreciated under accelerated or straight line methods over each item's estimated useful life.



6



PROMAP CORPORATION

NOTES TO FINANCIAL STATEMENTS

(UNAUDITED)



NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):


Revenue Recognition


Revenue is recognized on an accrual basis as earned under contract terms. Specifically, revenue from product sales is recognized subsequent to a customer ordering a product at an agreed upon price, delivery has occurred, and collectability is reasonably assured.


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 carryforwards 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.


Net income (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.


Financial Instruments


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


Long-Lived Assets


In accordance with ASC 350, 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 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.





7





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


The following discussion and analysis should be read in conjunction with the Financial Statements (unaudited) and Notes to Financial Statements (unaudited) filed herein.


BUSINESS OVERVIEW


Promap Corporation was incorporated in the State of Colorado on November 12, 1987. We are an independent GIS and custom draft energy mapping company for the oil and gas industry in the United States and Canada.  We provide hard copy and digital format oil and gas production maps which cover various geologic basins in numerous areas including:  Denver Basin, Powder River Basin, Michigan Basin, Williston Basin, Arkoma Basin, Illinois Basin, Cincinnati Arch, Uintah - Piceance Basins and The Nevada Basin.  We also provide maps of the North American Coal Basin and Coal Bed Methane Activity and North American Devonian - Mississippian Shale Map with detailed pipeline locations.


RESULTS OF OPERATION FOR THE THREE MONTHS ENDED JUNE 30, 2013 AS COMPARED TO THE THREE MONTHS ENDED JUNE 30, 2012.


Revenues for the three months ended June 30, 2013 were $4,147 as compared to the revenues of $16,393 for the three months ended June 30, 2012.  The revenues decreased significantly due to a decrease in the oil and gas drilling activities of the Company’s clients.   


The only operating expenses during these periods consisted of general and administrative expenses which were $6,446 in the three months ended June 30, 2013 as compared to $9,170 for the three months ended June 30, 2012.  The $2,724 decrease was due to the reduced level of business activity.


The net loss for the three months ended June 30, 2013 was ($9,852) as compared to a net loss of ($4,944) for the three months ended June 30, 2012.  The primary reason for the increased loss in the second quarter of 2013 was due to the decline in revenue.


RESULTS OF OPERATION FOR THE SIX MONTHS ENDED JUNE 30, 2013 AS COMPARED TO THE SIX MONTHS ENDED JUNE 30, 2012.


Revenues for the six months ended June 30, 2013 were $21,511 as compared to the revenues of $21,009 for the six months ended June 30, 2012.  The revenues were fairly steady for the complete 6 month periods although they declined in the last 3 months of the latest period.


The only operating expenses during these periods consisted of general and administrative expenses which were $15,233 in the six months ended June 30, 2013 as compared to $18,692 for the six months ended June 30, 2012.  The $3,459 decrease was due to a general slowdown in the Company’s business activity during the last three months.


The net loss for the six months ended June 30, 2013 was ($5,855) as compared to a net income of $24,562 for the six months ended June 30, 2012.  The primary reason for the change from a small income in 2012 to a small loss in 2013 was the reduction in the Company’s business primarily in the last three months.


 LIQUIDITY AND CAPITAL RESOURCES


As of June 30, 2013, we had $8,644 of working capital compared to $14,499 of working capital as of December 31, 2012.


Net cash used for operating activities during the six months ended June 30, 2013 was $12,608 as compared to net cash provided by operating activities in the six months ended June 30, 2012 of $22,485.  The primary reason for the poor performance was due to the $5,855 loss in the most recent period compared to net income of $24,562 in the prior year period.




8





Net cash provided by financing activities during the six months ended June 30, 2013 was zero as compared to zero provided by financing activities in the six months ended June 30, 2012.  


CONTRACTUAL OBLIGATIONS


None.


OFF-BALANCE SHEET ARRANGEMENTS


We do not have any off-balance sheet arrangements (as that term is defined in Item 303 of Regulation S-K) that are reasonably likely to have a current or future material effect on our financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources.


Item 3.  Quantitative and Qualitative Disclosures About Market Risk. 


Not applicable.


Item 4.  Controls and Procedures.


(a)  Evaluation of Disclosure Controls and Procedures.


Our Chief Executive Officer and Principal Financial Officer have evaluated the effectiveness of the design and operations of our disclosure controls and procedures as of the end of the period covered by this quarterly report, and have concluded that our disclosure controls and procedures are adequate.


(b)  Changes in Internal Control over Financial Reporting.


No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.



9





PART II – OTHER INFORMATION


Item 1.    Legal Proceedings.


None.


Item 1A.  Risk Factors.


Not applicable.


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


None.


Item 3.    Defaults Upon Senior Securities.


Not applicable.


Item 4.    Mine Safety Disclosures.


Not applicable.


Item 5.    Other Information.


Not applicable.


Item 6.    Exhibits.


(a)  Exhibits required by Item 601 of Regulation S-K.

 

Exhibit

 

Description

 

 

 

31.1

 

Certification of CEO and Principal Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) - Filed herewith electronically

 

 

 

31.2

 

Certification of CFO and Principal Financial and Accounting Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) - Filed herewith electronically

 

 

 

32.1

 

Certification of CEO and Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Filed herewith electronically

 

 

 

32.2

 

Certification of CFO and Principal Financial and Accounting Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Filed herewith electronically




  



10





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.


 

 

PROMAP CORPORATION

 

 

 

 

 

 

 

 

 

 

 

 

Date:  July 19, 2013

By:

/s/ Steven A. Tedesco

 

 

 

 

Steven A. Tedesco, President and CEO

(Principal Executive Officer)

 

 

 

 

 

 

 

 

 

 

 

 

Date:  July 19, 2013

By:

/s/ Robert W. Carington, Jr.

 

 

 

 

Robert W. Carington, Jr., CFO

(Principal Financial Officer and Principal Accounting Officer)

 





11