Attached files

file filename
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR14.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR18.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR20.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR11.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR16.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR10.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR2.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR1.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR4.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR3.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR7.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR6.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR8.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR5.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR21.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR13.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR15.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR19.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR12.htm
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR17.htm
EXCEL - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCFinancial_Report.xls
XML - IDEA: XBRL DOCUMENT - REAL HIP-HOP NETWORK, INCR9.htm
EX-32.1 - EXHIBIT 32.1 - REAL HIP-HOP NETWORK, INCex32.htm
EX-31.2 - EXHIBIT 31.2 - REAL HIP-HOP NETWORK, INCex31_2.htm
EX-31.1 - EXHIBIT 31.1 - REAL HIP-HOP NETWORK, INCex31.htm
 
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-K

(Mark One)

x ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 31, 2014

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

For the transition period from ______________ to ______________

Commission File Number 000-54062

 REAL HIP-HOP NETWORK, INC.
(Exact name of registrant as specified in its charter)
Accelerated Acquisitions XII, Inc.
(Former name of registrant as specified in its charter)
 
Delaware
27-2787118
(State or other jurisdiction of
(I.R.S. Employer
incorporation or organization)
Identification No.)
 
1455 Pennsylvania Avenue NW, Suite 400,Washington, DC 20004
(Address of principal executive offices)
 
(202) 379-3115
(Registrant’s telephone number, including area code)

                                                                                     
Former Address of Principal Executive Offices

 
 Securities registered under Section 12(b) of the Exchange Act:
None.
 
Securities registered under Section 12(g) of the Exchange Act:

Common Stock, $0.0001 par value per share
 (Title of Class)
 
Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes  ¨  No  x
 
Indicate by check mark whether the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes  ¨  No  x
 
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  No 
 
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  x
 
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 a smaller reporting company)
 
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes    No  x
 
The aggregate market value of the voting stock held by non-affiliates of the registrant was $0 as of March 31, 2014 because there was no trading market for the registrant’s securities and all outstanding stock was owned by an affiliate.
 
On June 30, 2014 there were 29,150,000 shares of the registrant’s common stock outstanding.
 
 
1

 

 
TABLE OF CONTENTS
 
PART I
     
ITEM 1.
BUSINESS
3
ITEM 1A.
RISK FACTORS
  15
ITEM 1B.
UNRESOLVED STAFF COMMENTS
15
ITEM 2.
PROPERTIES
  15
ITEM 3.
LEGAL PROCEEDINGS
15
     
PART II
     
ITEM 5.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
  15
ITEM 6.
SELECTED FINANCIAL DATA
  18
ITEM 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION
18
ITEM 7A.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
25
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
26
ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  39
ITEM 9A.
CONTROLS AND PROCEDURES
  39
ITEM 9B.
OTHER INFORMATION
  39
     
PART III
     
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
  40
ITEM 11.
EXECUTIVE COMPENSATION
  41
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
  42
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
  43
ITEM 14
PRINCIPAL ACCOUNTANT FEES AND SERVICES
  43
     
PART IV
     
ITEM 15.
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
  44
     
SIGNATURES
 
  45

 

 
 
 
2

 
 
 
ITEM 1.  BUSINESS
 
This report contains forward-looking statements. In some cases, these statements may be identified by terminology such as “anticipates,” “believes,” “continue,” “estimates,” “expects,” “may,” “plans,” “potential,” “predicts,” “should,” “will,” and other comparable terminology. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements were based on various factors and were derived utilizing numerous assumptions and other factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, our ability to develop our operations, our ability to satisfy our obligations, our ability to raise capital as necessary, our ability to generate revenues and pay our operating expenses, our ability to consummate the acquisition of additional assets, economic, political and market conditions and fluctuations, government and industry regulation, U.S. and global competition, and other factors.  Most of these factors are difficult to predict accurately and are generally beyond our control.  You should consider the areas of risk described in connection with any forward-looking statements that may be made herein.  Readers are cautioned not to place undue reliance on these forward-looking statements and readers should carefully review this report in its entirety, including the risks described in Item 1A - "Risk Factors" as well as the risk factors described in our other filings with the Securities and Exchange Commission.  Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to update any of our forward-looking statements. These forward-looking statements speak only as of the date of this report, and you should not rely on these statements without also considering the risks and uncertainties associated with these statements and our business. “RHN” The Real Hip-Hop Network” “We,” “us,” “our,” the “Company,” and “Accelerated Acquisitions XII, Inc., a Delaware corporation..

None of the Company’s securities are registered for resale with the Securities and Exchange Commission. The outstanding shares of common stock may only be resold through registration under the Securities Act of 1933, or under an applicable exemption from registration.

Organization within the Last Five Years

From inception May 4, 2010, The Real Hip-Hop Network, Inc. (formally known as Accelerated Acquisitions XII, Inc.) was organized as a vehicle to investigate and, if such investigation warrants, acquire a target company or business seeking the perceived advantages of being a publicly held corporation. Our principal business objectives were to achieve long-term growth potential through a combination with a business rather than immediate, short-term earnings. The Company did not restrict our potential candidate target companies to any specific business, industry or geographical location and, thus, may acquire any type of business.
 
On May 4, 2010, the Registrant sold 5,000,000 shares of Common Stock to Accelerated Venture Partners, LLC for an aggregate investment of $2,000.00.  The Registrant sold these shares of Common Stock under the exemption from registration provided by Section 4(2) of the Securities Act.

On July 16, 2011, SSM Media Ventures, Inc. (“Purchaser”) agreed to acquire 22,350,000 shares of the Company’s common stock par value $0.0001 for a price of $0.0001 per share. At the same time, Accelerated Venture Partners, LLC agreed to tender 3,500,000 of their 5,000,000 shares of the Company’s common stock par value $0.0001 for cancellation. Following these transactions, SSM Media Ventures owned approximately 94% of the Company’s 23,850,000 issued and outstanding shares of common stock par value $0.0001 and the interest of Accelerated Venture Partners, LLC was reduced to approximately 6% of the total issued and outstanding shares. Simultaneously with the share purchase, Timothy Neher resigned from the Company’s Board of Directors and Atonn Muhammad was simultaneously appointed to the Company’s Board of Directors. Such action represents a change of control of the Company.

The Purchaser used their working capital to acquire the Shares. The Purchaser did not borrow any funds to acquire the Shares. Prior to the purchase of the shares, the Purchaser was not affiliated with the Company. However, the Purchaser will be deemed an affiliate of the Company after the share purchase as a result of their stock ownership interest in the Company. The purchase of the shares by the Purchaser was completed pursuant to written Subscription Agreements with the Company.  The purchase was not subject to any other terms and conditions other than the sale of the shares in exchange for the cash payment. The Company filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of Delaware in order to change its name to “The Real Hip-Hop Network, Inc.” on May 10, 2013.
 
Consulting Agreement:  On July 18, 2011, the Company entered into a one year Consulting Services Agreement with Accelerated Venture Partners LLC (“AVP”) (See Exhibit 10.3), a company controlled by Timothy J. Neher.  The agreement requires AVP to provide the  Company  with certain advisory services that include reviewing the Company’s business plan, identifying and introducing prospective financial and business partners, and providing general business advice regarding the Company’s operations and business strategy in consideration of (a) an option granted by the Company to AVP to purchase 1,500,000 shares of the Company’s common stock at a price of $0.0001 per share (the “AVP Option”) (which was immediately exercised by the holder) subject to a repurchase option granted to the Company to repurchase the shares at a price of $0.0001 per share in the event the Company fails to complete funding as detailed in the agreement subject to the following milestones:
 
 
 
 
3

 
 
 

Milestone 1 -
Company’s right of repurchase will lapse with respect to 60% of the shares upon securing $10 million in available cash from funding;
Milestone 2 -
Company’s right of repurchase will lapse with respect to 20% of the Shares upon securing $20 million in available cash (inclusive of any amounts attributable to Milestone 1);
Milestone 3 -
Company’s right of repurchase will lapse with respect to 20% of the Shares upon securing $30 million in available cash (inclusive of any amounts attributable to Milestone 2);
and (b) cash compensation at a rate of $66,667 per month. The payment of such compensation is subject to Company’s achievement of certain designated milestones, specifically, cash compensation of $800,000 is due consultant upon the achievement of Milestone 1, $800,000 upon the achievement of Milestone 2 and $800,000 upon the achievement of Milestone 3. Upon achieving each Milestone, the cash compensation is to be paid to consultant in the amount then due at the rate of $66,667 per month. The total cash compensation to be received by the consultant is not to exceed $2,400,000 unless the Company receives an amount of funding in excess of the amount specified in Milestone 3. If the Company receives equity or debt financing that is an amount less than Milestone 1, in between any of the above Milestones or greater than the above Milestones, the cash compensation earned by the Consultant under this Agreement will be prorated according to the above Milestones. The Company also has the option to make a lump sum payment to AVP in lieu of all amounts payable thereunder.

On June 7, 2012,  the Company elected to relinquish its rights to repurchase 1,500,000 million shares on common stock issues to Accelerated Venture Partners (AVP) in the July 18, 2011 Consulting Services Agreement. Additionally,  issued  AVP 3,800,000 million shares of common stock for continued consulting services unrelated to the aforementioned agreement and for the continued financing of general business expenses including legal, accounting, auditing and financing the required SEC filing obligations until the Company completes the financing described in this prospectus.
 
On August 14, 2013 the Company amended the July 18, 2011 Consulting Services Agreement with Accelerated Venture Partners LLC (“AVP”) (See Exhibit 10.6), a company controlled by Timothy J. Neher.  The amended AVP Agreement is for twelve months and requires AVP to provide the Company with certain advisory services that include reviewing the Company’s business plan, identifying and introducing prospective financial and business partners, and providing general business advice regarding the Company’s operations and business strategy in consideration of cash compensation at a rate of $66,667 per month.  The payment of such compensation is subject to Company’s achievement of certain designated milestones, specifically, cash compensation of $800,000 is due consultant upon the achievement of Milestone 1 (securing $10 million in available cash from funding), $800,000 upon the achievement of Milestone 2 (securing $20 million in available cash inclusive of any amounts attributable to Milestone 1) and $800,000 upon the achievement of Milestone 3 (securing $30 million in available cash inclusive of any amounts attributable to Milestone 2). Upon achieving each Milestone, the cash compensation is to be paid to consultant in the amount then due at the rate of $66,667 per month. The total cash compensation to be received by the consultant is not to exceed $2,400,000 unless the Company receives an amount of funding in excess of the amount specified in Milestone 3. If the Company receives equity or debt financing that is an amount less than Milestone 1, in between any of the above Milestones or greater than the above Milestones, the cash compensation earned by the Consultant under this Agreement will be prorated according to the above Milestones. The Company also has the option to make a lump sum payment to AVP in lieu of all amounts payable thereunder.
 
License Agreement:  On August 15, 2011, the Company entered into a Licensing Agreement (“Licensing Agreement”) (See Exhibit 10.4), with Real Hip-Hop Network Broadcast Corporation (“Licensor”) (The Licensor is controlled by a SSM Media Ventures Inc., a major shareholder in the Company- Voting and/or investment power for SSM Media Ventures Inc. is held by Atonn Muhammad , the CEO of the Company), pursuant to which the Company was granted an exclusive, non-transferrable worldwide license for certain first run movies, live concerts, break-dance battles, rhyme competitions, documentaries, news, DJ competitions and interviews (“media content”), distribution platforms, patents, intellectual property, know-how, trade secret information (“technology”) to provide, family-appropriate Hip-Hop content to a multi-racial/multi-generational demographic. Pursuant to the Licensing Agreement the Company is required raise at least Five Hundred Thousand Dollars ($500,000) for its future development before August 15, 2013, raise at least Five Hundred Thousand Dollars ($500,000) for its future deployment before August 15, 2014, and raise at least One Million Dollars ($1,000,000) for its future deployment before August 15, 2015 equaling the minimum funding requirement of Two Million Dollars ($2,000,000) for the deployment of its content distribution over the next three years or we will lose our rights to the media content and distribution platforms. Additionally, the Company will shall pay Licensor a royalty of one quarter of one percent (.25%) of all gross revenues resulting from the use of the Technology by Licensee and if the technology is sub-licensed form the Company, the Company shall pay Licensor a one percent (1%) royalty except as otherwise modified in writing. Although, the Company did not raise the required $.05 million by the August 15, 2012 date it had a verbal agreement to extend the required financing dates by twelve months. The agreements are intended to allow the Company to launch commercially to a viewership of an estimated 32 million subscribers. The Company has started testing the content feed to both DirecTV and DISH Network and it is estimated that the testing will be completed by the end January, 2014 with no cost to the Company.
 
 
4

 
 
Upon completion of testing with DirecTV, the Company agreed to pay a non-refundable deposit to DirecTV of $522,000 and $261,000 per week the first year, $371,000 per week the second year and $391,000 per week the third year for services (all weekly payments are due two weeks in advance of content distribution). The services consist of a national feed to an estimated 18,411,000 million households of the programming service currently known as the “Real Hip-Hop Network” and/or “RHN”, which shall consist exclusively of the type of programming described herein, presented on a 24-hour per day, 7 days a week schedule to reach all DirecTV subscribers in the United States on an exclusive designated channel determined by DirecTV. Upon completion of testing with Dish Network, the Company agreed to pay a non-refundable deposit to Dish Network of $1,500,000 and $1,166,000 per month for services (all monthly payments are due in advance of content distribution). The services consist of a national feed to an estimated 14,000,000 million households of the programming service currently known as the “Real Hip-Hop Network” and/or “RHN”, which shall consist exclusively of the type of programming described herein, presented on a 24-hour per day, 7 days a week schedule to reach all Dish Network subscribers in the United States on an exclusive designated channel determined by Dish Network.

The company is operating independently of SSM Media the majority stockholder and The Real Hip-Hop Network, Broadcast Corp, the Licensor.

Except for the rights granted under the License Agreement, Licensor retains all rights, title and interest to the content and any additions thereto—although the License includes the Company’s right to utilize such additions.

The term of the License commences on the date of the Licensing Agreement and continues for thirty (30) years, provided that the Licensee is not in breach or default of any of the terms or conditions contained in this Agreement. In addition to other requirements, the continuation of the License is conditioned on the Company generating net revenues in the normal course of operations or the funding by the Company of specified amounts for qualifying distribution and commercialization expenses related to the media content. In addition, the Company is required to fund certain specified expenses related to the distribution of the media content as specified in the License Agreement. The license is terminated upon the occurrence of events of default specified in the License Agreement and outlined as followed: If any of the Parties are in breach or default of the terms or conditions contained in this Agreement and do not rectify or remedy that breach or default within 90 days from the date of receipt of notice by the other party requiring that default or breach to be remedied, then the other party may give to the party in default a notice in writing terminating this Agreement.

Licensee may, at its option, terminate this Agreement at anytime by doing the following: By ceasing to use the media content and distribution platforms facilitated by any Licensed Products. Giving sixty (60) days prior written notice to Licensor of such cessation and of Licensee’s intent to terminate, and upon receipt of such notice, Licensor may immediately begin negotiations with other potential licensees and all other obligations of Licensee under this Agreement will continue to be in effect until the date of termination. By tendering payment of all accrued royalties and other payments due to Licensor as of the date of the notice of termination and evidencing to the Licensor that provision has been made for any prospective royalties and other payments to which Licensor may be entitled after the date of termination.

Licensor may terminate the License Agreement if Licensee is in breach or default of the terms or conditions contained in this Agreement and does not rectify or remedy that breach or default within 90 days from the date of receipt of notice by Licensor requiring that default or breach to be remedied, then Licensor, may alter License granted by this Agreement with regards to its exclusivity, its territorial application and restrictions on its application.

Licensor may terminate the License Agreement if Licensee is in breach or default of the terms or conditions contained in this Agreement and does not rectify or remedy that breach or default within 90 days from the date of receipt of notice by Licensor requiring that default or breach to be remedied, then Licensor, may alter License granted by this Agreement with regards to its exclusivity, its territorial application and restrictions on its application.
 
 
 
 
5

 
 

On August 14, 2013, the Company entered into an amended Licensing Agreement (See Exhibit 10.5) with Real Hip-Hop Network Broadcast Corporation (Licensor of the Company’s media and technology). Pursuant to which the required financing dates outlined above in the August 15, 2011 Licensing Agreement were extended.  The Company is now required to raise at least Five Hundred Thousand Dollars ($500,000) for its future development before August 15, 2014, raise at least Five Hundred Thousand Dollars ($500,000) for its future deployment before August 15, 2015, and raise at least One Million Dollars ($1,000,000) for its future deployment before August 15, 2016 equaling the minimum funding requirement of Two Million Dollars ($2,000,000) for the deployment of its content distribution over the next three years or we will lose our rights to the media content and distribution platforms. Additionally, under the same terms as the August 15, 2011 Licensing Agreement the Company will shall pay Licensor a royalty of one quarter of one percent (.25%) of all gross revenues resulting from the use of the Technology by Licensee and if the technology is sub-licensed form the Company, the Company shall pay Licensor a one percent (1%) royalty except as otherwise modified in writing. Through the License Agreement the Company was assigned binding and enforceable contract with DirecTV, the term of the agreement is for the period commencing on May 8, 2013 and ending on the first anniversary of the Service Commencement Date, which is anticipated to be December of 2014 (the “Term”). DirecTVshall have the option to extend the Agreement for one (1) additional year upon notice to the Company at least sixty (60) days prior to the scheduled expiration of the Term (and the “Term” shall be deemed to include any such extension period). The “Service Commencement Date” means the date on which DirecTV commences distribution of the Service via the DirecTV Distribution System for revenue-generating purposes, which date shall be on or about December 1, 2013. Furthermore, the Company was assigned binding and enforceable contract with DISH Network that began May 1, 2013 and expires February 28, 2015. Pursuant to the agreements there are customary subscriber fees, deposits and customary representations and warranties of each of the parties and can be terminate by either party with thirty days written notice. The agreements are intended to allow the Company to launch commercially to a viewership of an estimated 32 million subscribers. The Company has started testing the content feed to both DirecTV and DISH Network and it is estimated that the testing will be completed by the end January, 2014 with no cost to the Company.

Through the License Agreement the Company was assigned binding and enforceable contract with DirecTV, the term of the agreement is for the period commencing on May 8, 2013 and ending on the first anniversary of the Service Commencement Date, which is anticipated to be December of 2014 (the “Term”). DirecTVshall have the option to extend the Agreement for one (1) additional year upon notice to the Company at least sixty (60) days prior to the scheduled expiration of the Term (and the “Term” shall be deemed to include any such extension period). The “Service Commencement Date” means the date on which DirecTV commences distribution of the Service via the DirecTV Distribution System for revenue-generating purposes, which date shall be on or about December 1, 2013. Furthermore, the Company was assigned binding and enforceable contract with DISH Network that began May 1, 2013 and expires February 28, 2015. The contracts with DirecTV and DISH Network are intended allow the Company to launch commercially to a viewership of an estimated 32 million subscribers. The Company has started testing the content feed to both DirecTV and DISH Network and it is estimated that the testing will be completed by the end January, 2014 with no cost to the Company.

Upon completion of testing with DirecTV, the Company agreed to pay a non-refundable deposit to DirecTV of $522,000 and $261,000 per week the first year, $371,000 per week the second year and $391,000 per week the third year for services (all weekly payments are due two weeks in advance of content distribution). The services consist of a national feed to an estimated 18,411,000 million households of the programming service currently known as the “Real Hip-Hop Network” and/or “RHN”, which shall consist exclusively of the type of programming described herein, presented on a 24-hour per day, 7 days a week schedule to reach all DirecTV subscribers in the United States on an exclusive designated channel determined by DirecTV. Upon completion of testing with Dish Network, the Company agreed to pay a non-refundable deposit to Dish Network of $1,500,000 and $1,166,000 per month for services (all monthly payments are due in advance of content distribution). The services consist of a national feed to an estimated 14,000,000 million households of the programming service currently known as the “Real Hip-Hop Network” and/or “RHN”, which shall consist exclusively of the type of programming described herein, presented on a 24-hour per day, 7 days a week schedule to reach all Dish Network subscribers in the United States on an exclusive designated channel determined by Dish Network. The Company began testing with the networks in August, 2013 and anticipated completion in November of 2013 and has been delay do to testing until the end of January 2014. The Company will not be able to launch it content on either network until the aforementioned deposits and monthly fees can be paid.  The Company currently has no cash or ability to pay the network fees and is relying on the primary offering in this prospectus to meet the obligations. Pursuant to the agreements there are customary representations and warranties of each of the parties and can be terminate by either party with thirty days written notice.

The company is operating independently of SSM Media the majority stockholder and The Real Hip-Hop Network, Broadcast Corp, the Licensor.

 
6

 

Business Overview
 
The Real Hip-Hop Network (“RHN”) is an emerging growth company that intends to provide family-appropriate (family-appropriate “meaning it is considered suitable for all members of the average family”) Hip-Hop content to a multi-racial/multi-generational demographic through multiple distribution platforms that will initially include cable/satellite television, and through the Company’s website at RHN.TV.  The Company also intends to utilize broadband, digital and wireless platforms to deliver music, gaming and steaming video to mobile devices and in home gaming systems.  RHN currently has exclusive rights to approximately 30,000 hours of content, which is equivalent to 3.4 years.  ). The Company intends to launch commercially through national subscription TV, estimated within the second quarter of 2014.  The Company has beta tested the delivery of live streaming version of its video content on the Company’s website RHN.TV.   
 
The Company intends to provide a mix of approximately 45% music video-based entertainment, approximately 55% of RHN’s lineup includes original programming revolving around the Hip-Hop lifestyle, culture and pro-social programs, such as first run movies, live concerts, break-dance battles, rhyme competitions, documentaries, news, DJ competitions, interviews and exciting original content. We are currently evaluating all our options to commercialize our licensed content and platforms. The Company’s concept and content has been beta tested and has not been deployed for commercial sale anywhere in the world. Although the Company’s technology and platform in ready for deployment each country have different requirements for deployment, so the commercialization process is likely to be lengthy and complex. The Company may employ different strategies in different areas of the world, such as sublicensing deployment and commercialization rights for some territories while retaining rights for other territories.
 
Revenue: Our primary sources of revenue is intended to come from affiliate fees and advertising. The Company anticipates the first one to three years of revenues will be generated by advertising as we will be paying the providers for the distribution of our content and for the third year and beyond after the Company establishes rating scores the Company intends on generating Affiliate revenues.   Affiliate revenues are derived from long-term distribution agreements with cable, satellite and telecommunications operators who pay us a monthly fee for each subscriber household that receives RHN content.
 
 Need for Additional Capital:  The Company will not be able to commercialize either its media content or distribution platforms without additional capital, if we do not raise at least Five Hundred Thousand Dollars ($500,000) for its future development before August 15, 2014, raise at least Five Hundred Thousand Dollars ($500,000) for its future deployment before August 15, 2015, and raise at least One Million Dollars ($1,000,000) for its future deployment before August 15, 2016 equaling the minimum funding requirement of Two Million Dollars ($2,000,000) for the deployment of its content distribution over the next three years or we will lose our rights to the media content and distribution platforms. Additionally, the Company will shall pay Licensor a royalty of one quarter of one percent (.25%) of all gross revenues resulting from the use of the Technology by Licensee and if the technology is sub-licensed form the Company, the Company shall pay Licensor a one percent (1%) royalty except as otherwise modified in writing. The Company will require significant additional financing in order to meet the milestones and requirements of its Business Plan and avoid discontinuation of the License.  Funding would be required for staffing, marketing, public relations and the necessary distribution to expanding the scope of its offering to include the global market. The Company intends to seek at an aggregate of $25,000,000 in 2014 through the sale of equity or convertible debt securities, the issuance of these securities could dilute existing shareholders. The Company’s funding plans include selling additional capital stock and/or borrowing to fund the aforementioned expenses. The Company intends to approach Hedge Funds, Venture Capital Groups, Private Investment Groups and other Institutional Investment Groups in its efforts to achieve future funding. It is estimated that $2,755,548 will be used for sales and marketing, $12,930,077 will be used for the TV network fees, an estimated $2,049,325 will be spent on management, legal, accounting, rent, financing fees and other payables, $ 16,889 will be spent on this offering and $3,589,520 will be spent on production and programming leaving $3,658,641 in reserve for increased working capital.

There is no guarantee that the Company will be able to raise this or any amount of additional capital and a failure to do so would have a significant adverse effect on the Company’s ability, or would cause significant delays in its ability to address the market for the distribution of media content and achieve its Business Plan, it estimated the minimum amount of capital the company needs to raise over the ne twelve months is $2 million to continue operations. Neither the Company nor any of its advisors or consultants has significant experience in raising funds similar to the $25,000,000 estimated to be required.

 
 
 
7

 
 
 
Industry Background
 
We believe that the way in which young adults consume media and engage with news, information and lifestyle content are undergoing changes. We believe the dynamic preferences and consumption patterns of young adults are not being adequately addressed by traditional media outlets. At the same time, technology is transforming the way media is created, expanding the universe of content creators, altering the cost structure of content production and distribution, and enabling delivery across multiple platforms. The packaging and programming of content is also evolving, enabling new means of distribution capable of rapidly adapting to changing consumer preferences. As the way young adults engage with news, information and lifestyle content changes, it presents new challenges to networks and advertisers who target the 18-34 year-old audience demographic. The Company believes these challenges could include:
 
·
Evolution in the media preferences and consumption patterns of young adults. Young adults want to engage with programming related to news, information and lifestyle, but their consumption patterns have evolved faster than traditional television programming, leaving their needs underserved.
 
·
Changes in media programming and production. Digital media tools enable scalable production with relatively low overhead, open systems and small teams, which has changed the way content can be processed, organized and delivered.

·
Evolution in content creation. Changes in the means and cost structure of content production and distribution have significantly expanded the universe of potential content creators. As a result, programming can be a conversation between viewers and a network, offering freedom from one-way communication and resulting in unprecedented engagement and participation.
 
·
Changes in advertising models that drive the media industry. Advertisers devote the largest portion of their media spending to television. However, the traditional TV advertising model is becoming less effective with young adults, who are changing their viewing patterns.
 
Market Opportunity
 
We believe there is a market opportunity to develop an integrated media platform capable of cost-effectively engaging young adults around news, information and lifestyle entertainment, and to build a brand premised on communicating what is going on in the lives of this young-adult generation. We believe there is demand from both young adults and the advertisers who target them for a media platform that engages 18-34 year-olds in pop culture, politics, careers and relationships.
 
Our media platform is intended to motivate its audiences to make a difference in their lives and communities with a broad and impactful pro-social agenda. In addition, providing a mix of approximately 45% music video-based entertainment, approximately 55% of  RHN’s lineup includes original programming revolving around the Hip-Hop lifestyle, culture and pro-social programs, such as first run movies, live concerts, break-dance battles, rhyme competitions, documentaries, news, DJ competitions, interviews and exciting original content provides a compelling way to capture this opportunity.
 
Hip-Hop Market
 
Originating an estimated 30 years ago as an “underground” urban music genre popular in a few large U.S. cities, Hip-Hop has evolved and expanded into a broadly popular global entertainment and cultural medium.  Business Week reported as early as 2005 that there were an estimated 100 million Hip-Hop fans worldwide, including 50 million in the U.S. The following discussion highlights what the Company believes is distinctive appeal of the Hip-Hop market, focusing on the characteristics that make it ideally suited to support the Company’s dedicated programming network.  Specifically:
 
 
 
 
8

 
 
 
·
While it has grown far beyond its music roots, Hip-Hop is fundamentally a media-based industry targeting a media-centric audience. It is estimated that Hip-Hop is the second largest selling music category, trailing only Country (for which, by comparison, there are already three dedicated cable networks). There are at least two Hip-Hop radio stations ranked among the top 10 (based on listenership) in nine of the ten largest U.S. markets.

·
Hip-Hop music and culture have broad appeal to a large cross-section of the U.S. teen and young adult population (i.e., individuals aged 12-34). While Hip-Hop retains its popularity and cultural draw in the urban market, the majority of Hip-Hop consumers are Caucasian suburbanites – reflecting the significant (and growing) urban influence on suburban culture. Hip-Hop’s broad appeal has made the genre extremely important and attractive to major advertisers seeking to connect with this difficult to reach young audience.

·
Leading Hip-Hop entertainers have emerged as “One Man Brands,” achieving enormous success in marketing apparel, footwear, video games, etc. – as well as endorsing products and “crossing over” into television and film acting careers.

·
Finally, entertainment and “reality” television programming with Hip-Hop themes is increasingly prevalent and popular, while Hip-Hop videos are estimated to be the most popular genre in the MTV Network’s music menu as well as the most popular programming category on the Black Entertainment Television (“BET”)

The entrepreneurial spirit and savvy of leading Hip-Hop artists initially transformed the marketing landscape by establishing the “One Man Brand.”  More recently, Hip-Hop entrepreneurs have increasingly intertwined their own initiatives with the activities of major advertisers and Fortune 500 companies.

Programming Strategy
 
Programming is anticipated to be the company’s fundamental strength and the factor that most distinguishes the network from competitors. The Company intends to devote time to current and past Hip-Hop “stars,” but will also devote time to emerging artists in the field.  In addition, the number of hours of programming the company will devote to news, magazine, lifestyle and reality shows about and/or featuring Hip-Hop artists will be extremely difficult to duplicate by other networks because our network will initially be built with essentially “no cost” music videos which will form the basis of much of its programming schedule, RHN’s programming strategy allows for greater ability to manage investment, as the business scales.
 
Programming Themes and Concepts
 
The Company intends to be flexible with its programming mix and content to respond to its target market.  However, the network’s plan is to establish a programming schedule consisting of approximately 45% (11 hours per day) of music video-based entertainment, and about 55% (13 hours per day) of original programming revolving around the Hip-Hop lifestyle and culture.  The original programming is expected to be studio-based shows, magazine shows and documentaries/reality shows produced by the Company (e.g., generally modest cost, hosted shows with interviews and some live performances), while the Company will initially utilize the content it currently owns or has right to use, future  programming is expected to be acquired and/or bartered from independent producers.
 
A broad sampling of the specific programming themes and concepts that the network intends to feature include
 
 
 
 
9

 
 
 
·
Live Concert Series. We intend to air up to six original Hip-Hop concerts per year, featuring artists ranging from the well-established to the up-and-coming and these concerts will be repeated throughout the calendar year.

·
News, Magazine Shows, and Daily Talk Show. The Company will produce and acquire a number of topical news and magazine shows that detail relevant news and information about the Hip-Hop community. For example, One Nation Hip-Hop will be an “Entertainment Tonight”-style program providing information about the latest TV shows, movies and sitcoms featuring the biggest and hottest Hip-Hop celebrities. It will also feature current album releases and concert tour information. Analyze This will feature celebrity guests from diverse backgrounds discussing the issues and controversies behind rap lyrics, and Hip-Hop Insider will be a news show featuring politics, news and sports, hosted by RHN VJs. Mogol is a Hip-Hop business show featuring segments on record industry economics, news on the latest deals of superstar Hip-Hop recording artists, and lifestyle segments with showcases of homes, cars and travel destinations of the Hip-Hop elite. Rap Sheet is a Hip-Hop news and commentary show featuring writers from Hip-Hop’s greatest magazines, including Source, Vibe and XXL. Finally, management has plans for a nightly talk show called Hip-Hop Late Nite featuring live guests.

·
Documentary and “Competition” Programming. We will seek to assemble a stable of documentaries and artist profiles/features programs. Legend will chronicle the greatest Hip-Hop legends, while Behind the Platinum will showcase the backstage, behind the scenes scandals, shady deals, violence and murder that exist in the dark corners of the music industry. Dollar and Dream will document the rise of Hip-Hop’s greatest artists. In addition, Unsigned Heat will profile the hottest unsigned MC’s in the business. Competition style programming will include Technics World, a DJ competition, and Rap Wars, a nationwide MC freestyle battle competition. Rap Superstar will be an American Idol-style Rap show with celebrity guest judges. In addition, the Company has acquired and will “re-version” extensive footage and pre-produced segments that have been developed by Pseudo Entertainment and others. Much of this content is of high quality and is readily adaptable for television using low cost post-production techniques. This approach mirrors that often used by The History Channel, Biography and others, to develop quality documentary and reality programming at a modest cost.

·
Entertainment Programming. The Company intends to round out its programming schedule with a number of entertaining shows designed to appeal to segments of its target audience. These shows include:

§  
Kissed or Dissed – a dating show chronicling the dates of Hip-Hop singles culminating in whether their partners will be kissed or dissed.
 
§  
Beneath the World Order – a Company original animated series.

§  
Flip Side – a reality show where two people from different worlds switch places.
 
§  
Chrome – a program dedicated to Hip-Hop’s love affair with cars.

§  
Street Skillz: Street Ball Tournament – hosted by popular former MTV hosts Ed Lover and Dr. Dre, this show offers the winner of a street basketball tournament a workout with NBA scouts.
 
§  
Couture with Toni – a fashion show based on Hip-Hop fashion hosted by the Company’s personalities.

§  
Every Woman has a Story – a show on women and their struggles.
 
§  
Serve it Up – this show features Raz B, a former member of pop super group B2K and an actor in the movie about Hip-Hop dance “You Got Served.” The show will have top Hip-Hop dance troops compete for cash and prizes in front of celebrity judges.
 
§  
The Deal – featuring The Outlawz, this show takes a behind-the-scenes look at their lives both on and off stage, as they struggle to make their own way outside the legacy of legendary artist Tupac Shakur.
 
In the event distribution and revenue proceed at a different pace than projected, the Company has the flexibility to adopt a different programming mix (e.g., exhibit more “no cost” music videos) and thereby contain costs.
 
 
10

 
 
Key elements of the Company’s programming model include:

·
Acquired entertainment programming/partnerships with existing niche producers. We believe that much of the acquired entertainment programming can be obtained at a modest cost. In addition, by partnering with existing niche producers for the development of certain ongoing original programming, The Company anticipates to be able to obtain distribution rights to a significant amount of content at no cash cost (i.e., on a barter basis). Our production staff will support the creation of an expanded number of programs by these partners and ensure an on-air look consistent with the network’s overall format.

·
Acquired and re-versioned documentary programming. By employing a combination of acquired documentary programming and utilization of post-production resources to enhance and package footage and segments obtained at little or no cost from sources we will be able to offer an appealing array of documentary-style content at a very feasible total cost.

·
Original studio production. A significant percentage of our original programming will be studio-based. Most shows (whether news, magazine, talk shows or hosted music video segments) will be hosted by staff VJs and will feature interviews and live performances from Hip-Hop artists looking to promote their latest work. Costs for this programming can be carefully managed. Hosted music video programs will feature wrap-around introductions and commentary produced efficiently in the studio as well.

·
Opportunity for multiple airings. Much of the Company’s programming can be aired on multiple occasions, providing viewers with additional opportunities for viewing the content, while also minimizing costs. Given the network’s reliance on music videos, most of our annual programming needs will be constantly refreshed at little or no cost, as music labels/record companies will provide new releases of music videos on a continual basis. This is expected to account for about 3,600 hours of the approximate 8,000 hours of annual programming needed by the Company. The remaining programming hours will be filled with modest-cost acquired programming and no-cost bartered programming, as well as original Company productions. Acquired programming is expected to be repeated as many as ten times and original Company productions are expected to be repeated on average as many as six times.

DISTRIBUTION AND MARKETING STRATEGY

The strategy is to provide content to its audience across all available media outlets: Broadcast TV, Broadcast Radio, Cable/Satellite, Broadband Internet, Print, mobile video, and gaming systems. The Company currently has binding and enforceable contracts with DirecTV and DISH Network, which will allow the Company to launch commercially to a viewership of an estimated 32 million subscribers. The aforementioned contracts were assigned to the Company on August 14, 2013 through a license agreement as described in the “Description of Business” section.
 
Management believes that the network’s programming will attract viewership and that the network’s concept will engender strong grass roots support from Hip-Hop fans.  As such, the network’s overall distribution and consumer marketing strategy is focused on the following:

·
Exposure. Marketing our network with key strategic partners, such as Fortune 500 companies, which are now recognizing the enormous size of the Hip-Hop Community. We will appoint a sales team to utilize approach on large and multiple opportunity advertisers.

·
Grass roots support. RHN recently completed the production of a major Hip-Hop concert event, and will continue to pursue grass roots marketing campaigns and develop launch and other promotional events that will attract Hip-Hop fans. These activities will not only contribute to the buzz and success of market-specific launches, they will also create broadened awareness of and interest in the network among Hip-Hop fans throughout the country. These fans will then be actively encouraged to support the network’s distribution efforts through follow-up targeted marketing campaigns.

·
Sponsorship: Promoting our services at television media industry shows as well as Hip-Hop events across the country and early stage advertising, in areas of potential viewership.

 
11

 
 
·
Source magazine promotion. The Company will also consistently promote the Hip-Hop Network and encourage grass roots support through its widely read partners and influential Source and Vibe magazines. Source and Vibe reaches the core of the Hip-Hop fan base – and provides a very effective means for stimulating “word-of-mouth” about the Real Hip-Hop Network.

Radio

The Company intends to acquire Local Marketing Agreements with broadcasters in strategic markets in the United States. Broadcast affiliates have already been identified. This strategy will create a radio presence for the Real Hip-Hop Network Brand with cross promotion capability with its broadcast foot print starting in New York City, NY, Los Angeles, CA, Chicago, IL and Washington, DC.
 
Digital Content Delivery
 
The Company intends to have broad distribution through digital platforms to cross promote our brands and sell digital content subscriptions through our web and TV properties. Ringtones, Wallpaper, and Music Video Downloads may be made available for a monthly subscription fee. The Company also intends to leverage its television viewing audience to create a mobile text community. The network has a short code that will be used to get gain revenue through fee-based music video or contest voting like other television shows.

Smart Phone Media Distribution

According to CTIA-The Wireless Association® an international nonprofit membership organization that has represented the wireless communications industry since 1984 states that the cell phone universe has over 300 million mobile subscribers, and the number of smart phone users will exceed 70 million in the U.S. in 2011. The Company intends to have mobile applications platforms and use existing platforms to make available a mobile version of its channel to be streamed live to all smart phones.

Broadband

RHN.TV intends to create a virtual audience build out from the channels national fan base. The network will stream its channel to the site live 24 hours a day and post popular shows on the site to be viewed on-demand.  Free RHN.TV e-mail addresses will be made available to the public as well as social networking and video file sharing like youtube.com. Premium digital content will be bought and sold online. RHN.TV will use existing popular social networking platforms to create and maintain an active and growing network of RHN fans and supporters.

Web-Based Marketing

Critical to producing visibility and traffic is the use of the Web for advertising.  We intend to have a  campaign which will increase traffic and contribute to "brand  recognition" and "brand loyalty" through a combination of search engine listings with meta-tags that produce search results in the top 10 on listings for Hip-Hop information. With the advent of WebTV, we believe that the prospect of entering more homes as a menu option delivered by a portal site like AOL or Google could enhance media exposure and visitation. The advent of broadband Internet services will be important but will not reduce our primary presence on “standard” television.

Affiliate Sales Strategy
 
The Company understands that opportunities for new networks to secure analog and even digital basic distribution are extremely limited and often require significant launch incentive payments that substantially increase the investment associated with the network.  Further, we are aware that its core audience is both highly coveted by advertisers and intensely interested in the network’s subject matter. For these reasons, the Company believes it can succeed as a service distributed via digital tiers and plans to seek inclusion in reasonably priced digital programming tiers that target a young adult audience.
 
 
12

 
 
In addition to positioning the network for tiered distribution, management intends to aggressively pursue early stage distribution by alternative video providers, most notably the major telephone companies.  It is believed that securing distribution via these outlets will significantly enhance prospects for carriage among the more established cable and satellite distributors.  Specifically, both Verizon and SBC have publicly announced plans to offer a range of programming choices that far exceeds anything currently available to consumers.  Further, because these companies are collectively building their fiber-based distribution networks in nearly every major market in the country, widespread carriage of RHN may place pressure on cable and satellite distributors on essentially a nationwide basis with a particular emphasis on the markets where the Hip-Hop’s appeal is likely to be greatest.
 
The Company intends to focus its distribution and consumer marketing efforts on major urban markets with significant African-American population concentrations and where Hip-Hop-formatted radio stations are consistently among the leading local radio outlets.

Advertising Sales Strategy

The Company’s advertising sales strategy centers on leveraging three primary strengths: (1) the appeal of its target audience; (2) unique cross-media packaging opportunities; and (3) the network’s expected major market concentration. The Company’s ability to capitalize on these key strengths is anticipated to be supported by strategic alliance within young adult marketing organizations.
 
Our advertising sales attributes are outlined in additional detail below:

ü                      Attractive audience demographics and strong appeal to major advertisers. We believe the Hip-Hop audience is concentrated in the hard-to-reach 12-34 demographic and major advertisers are aligning with Hip-Hop personalities as a means for reaching this demographic with extraordinary results.
 
ü                      Niche appeal to selected key brands/product categories. We believe that in addition to Hip-Hop’s appeal to major advertisers, the culture/lifestyle is closely aligned with certain brands and product categories, including clothing and footwear lines designed by or for Hip-Hop artists, as well as selected other products in the automotive, beverage and retail category. The Company intends to provide a natural vehicle for these advertisers to reach a loyal and lucrative customer base.
 
ü                      Magazine partnership.  We intend to partner with Hip-Hop magazines that will enable the Company to advertise in proven print media outlets that hold strong appeal and have an established market position in the Hip-Hop segment.
 
ü                      Concentration in major markets. It is anticipated that the Company’s initial distribution will be concentrated in the country’s largest television markets but the exact locations not been finalized.  These indemnified markets will have the highest priority for major advertisers and  the Company may be able to interest larger advertisers even in its early stages of development.
 
COMPETITIVE ENVIROMENT

Competitors to what the Company is offering include, but are not limited to:

·
MTV Networks. Following its launch as the first video music network in 1981, Viacom subsidiary Music Television (MTV) changed the television landscape and ultimately the music industry. In 2009, MTV was among the most widely distributed cable networks, available to over 98 million homes. While still effectively targeting the 12-34 demographic, MTV has substantially changed its programming format in recent years to feature reality programming such as The Real World and other series’ such as the popular Pimp My Ride.

·
BET Networks. Black Entertainment Television (BET) launched in 1980. In 2009, BET was available to 90 million homes worldwide. BET provides a range of programming intended to reflect African-American culture, including educational programs, sports, public affairs and music content. Further, the popularity of BET’s music programming led the organization to develop BET Jazz – which is available to approximately over 11 million homes and features jazz videos, films and documentaries.

 
13

 
 
·
TV One. TV One targets African American adults (i.e., the 25-54 demographic) with a mix of lifestyle programming, classic series, movies, fashion and music content. With ownership including Radio One, Comcast and DIRECTV, TV One is estimated to have attained distribution to 18 million homes in its first year of operation, and is current available to 48 million households. This network reflects the subscription TV industry’s growing interest in enhancing its appeal to the African American market.

·
VH1 Networks. Also owned by Viacom, the VH1 family of networks provides a range of music video and music-centered programming – geared primarily to the 25-54 demographic. In 2009, VH1 was available to 97 million households.

·
FUSE. Owned by Rainbow Media, FUSE promoted itself as the “only all-music, viewer-influenced television network.” FUSE programming includes music videos, artist interviews, live concerts and specials that emphasize “alternative” rock. In certain respects, FUSE is suggestive of the potential for RHN – as a truly music-centered alternative to the MTV family, with a concentrated emphasis on the 12-34 demographic and a particular, popular music-based lifestyle.
 
The Company intends to differentiate itself through a full-time focus on Hip-Hop content, the range of its coverage of the Hip-Hop culture, its unique understanding of the Hip-Hop lifestyle that emanates from direct involvement in the industry, and its focus on delivering higher-quality, family-appropriate Hip-Hop content to a multi-generational demographic.

GOVERNMENT REGULATIONS

The scope of communications regulations to which we or our distributors are subject varies from country to country. Typically, video programming regulation in each of the countries in which we or our distributors operate or plan to operate requires that domestic broadcasters and platform providers secure certain licenses from the domestic communications authority. Additionally, most nations have communications legislation and regulations that set standards regarding program content and the content and scheduling of television advertisements. Most nations also have legislation and regulations that provide that a certain portion of programming carried by broadcasters or multi-channel video programming distributors be produced domestically and to some degree be sourced from domestic production companies that are independent of the distributor. Some jurisdictions in which we plan to operate have strict censorship of content, and prohibited content may vary substantially over time.

In most countries, communications regulations are generally subject to periodic and ongoing governmental review and legislative initiatives that may affect the nature of programming we are able to offer and the means by which it is distributed. For example, the U.S. Federal Communications Commission, or FCC, is considering expansion of the exclusivity ban on programmers affiliated with cable operators to programmers affiliated with satellite networks. Any such restrictions, if adopted, could adversely affect our ability to negotiate with satellite programming distributors should we become subject to any such rules. In addition, some policymakers maintain that cable and satellite operators should be required to offer programming to subscribers on a network-by-network, or б la carte, basis or to provide "family friendly" program tiers. The unbundling or tiering of program services could result in reduced subscriber households and advertising revenues and increased marketing expenses. The timing, scope or outcome of these reviews and initiatives could be unfavorable to us, and any changes to current communications legislation or regulations could require adjustments to our operations.

The laws relating to the liability of providers of online services are currently unsettled both within the U.S. and abroad. Claims against other companies with online businesses similar to ours have been threatened and filed under both U.S. and foreign law for defamation, libel, invasion of privacy and other data protection, tort, unlawful activity, copyright or trademark infringement or other theories based on ads posted on a website and content generated by a website's users. Compliance with these laws is complex and may impose significant additional costs on us and restrictions on our business. Any failure to comply with these laws could subject us to significant liability.
 
 
14

 

EMPLOYEES

At present, we have four full time employees; they do not have employment agreements with us. We presently do not have pension, health, annuity, insurance, profit sharing or similar benefit plans; however, we may adopt such plans in the future. There are presently no personal benefits available to any employee. None of our employees are represented by a labor union and we consider our relationships with our employees to be good.

The company is currently working to implement employments agreements for our four employees and if, as and when a public market for the Company’s shares is established share from our incentive stock option plan may be issues to the employees.

Item 1A.    RISK FACTORS.

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

Item 1B.    UNRESOLVED STAFF COMMENTS.

None.
 
 ITEM 2.  PROPERTIES

We were incorporated in the State of Delaware on May 4, 2010, and established an end of March fiscal year end. Our corporate headquarters is located at 1455 Pennsylvania Avenue NW, Suite 400, Washington, DC 20004 and our telephone number is (202) 379-3115 our website is RHN.TV.
 
ITEM 3.  LEGAL PROCEEDINGS
 
There are no pending legal proceedings to which the Company is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of voting securities of the Company, or security holder is a party adverse to the Company or has a material interest adverse to the Company.
 
ITEM 4.   Reserved
 

PART II
 
ITEM 5.  MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
 
We intend to have our common stock be quoted on the OTC Bulletin Board or other US trading exchange. If our securities are not quoted on the OTC Bulletin Board or other US trading exchange, a security holder may find it more difficult to dispose of, or to obtain accurate quotations as to the market value of our securities. The OTC Bulletin Board differs from national and regional stock exchanges in that it:
 
(1) is not situated in a single location but operates through communication of bids, offers and confirmations between broker-dealers, and
 
(2) securities admitted to quotation are offered by one or more Broker-dealers rather than the “specialist” common to stock exchanges.
 
 
15

 
 
To qualify for quotation on the OTC Bulletin Board, an equity security must have one registered broker-dealer, known as the market maker, willing to list bid or sale quotations and to sponsor the company listing. We do not yet have an agreement with a registered broker-dealer, as the market maker, willing to list bid or sale quotations and to sponsor the Company listing. If the Company meets the qualifications for trading securities on the OTC Bulletin Board our securities will trade on the OTC Bulletin Board until a future time, if at all, that we apply and qualify for admission to quotation on the NASDAQ Capital Market. We may not now and it may never qualify for quotation on the OTC Bulletin Board or be accepted for listing of our securities on the NASDAQ Capital Market.

As of January 13, 2014, we had 29,150,000 shares of common stock outstanding and no shares issuable upon exercise of our employee stock options. All shares sold in this offering will be freely tradable without restriction or further registration under the Securities Act, except for, 2,376,050 shares (the “Lock-up Shares”) as described in the “Selling Stockholder Section” above and unless they are purchased by our “affiliates,” as that term is defined in Rule 144 promulgated under the Securities Act.
 
The outstanding shares of our common stock not included in this prospectus will be available for sale in the public market as follows:
 
Public Float
 
Of our outstanding shares, as of March 31, 2014, approximately 25,973.950 shares are beneficially owned by executive officers, directors and affiliates (there are no shares of our common stock which may be acquired upon exercise of stock options and employee options or currently exercisable or which become exercisable within 60 days of March 31, 2014).
 
Rule 144
 
In general, under Rule 144 as currently in effect, once we have been subject to public company reporting requirements for 90 days, a person (or persons whose shares are aggregated) who is not deemed to have been an affiliate of ours at any time during the three months preceding a sale, and who has beneficially owned restricted securities within the meaning of Rule 144 for a least six months (including any period of consecutive ownership of preceding non-affiliated holders) would be entitled to sell those shares, subject only to the availability of current public information about us. A non-affiliated person who has beneficially owned restricted securities within the meaning of Rule 144 for at least one year would be entitled to sell those shares without regard to the provisions of Rule 144.
 
In general, under Rule 144 as currently in effect, once we have been subject to public company reporting requirements for 90 days, our affiliates or persons selling shares on behalf of our affiliates who own shares that were acquired from us or an affiliate of ours at least six months prior to the proposed sale are entitled to sell upon expiration of the lock-up agreements described above, within any three-month period beginning 90 days after the date of this prospectus, a number of shares that does not exceed the greater of:
 
1% of the number of shares of common stock then outstanding, which will equal approximately shares immediately after this offering; or
 
the average weekly trading volume of the common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to such sale.
 
Sales under Rule 144 by our affiliates or persons selling shares on behalf of our affiliates are also subject to certain manner of sale provisions and notice requirements and to the availability of current public information about us.
 
TRANSFER AGENT
 
The intended stock transfer agent for our securities is Island Stock Transfer. St. Petersburg, FL.  Their address is 100 2nd Avenue South, 300N, St, Petersburg, Florida 33701. Their phone number is (727) 289-0010.
 
 
16

 
 
SHAREHOLDERS
 
As of January 13, 2014 the Company had 29,150,000 shares of our common stock issued and outstanding held by 51 holders of record. The selling stockholders are selling a total of 3,176,050 shares representing (10.89%) of the 29,150,000 issued and outstanding shares of common stock. The selling stockholders marked with an asterisk (*) in the selling shareholder table on page 25 hold 2,376,050 shares (the “Lock-up Shares”) of the 3,176,050 held by the selling stockholders, the 2,376,050 shares are subject to lock-up agreements.  These shares are subject to lock-up agreements that are scheduled to expire at various times during the next 15 months.  Under the terms of the lock-up agreements, the Lock-up Shares cannot be sold or transferred for a period of six (6) months (the “Lock-up Period”) from the date that the Securities and Exchange Commission  (SEC) declares this prospectus of the Company effective (the “Effective Date”).  On the date of expiration of the Lock-up Period and for each of the three (3) consecutive three-month periods after the date of expiration of the Lock-up Period, the aggregate number of Lock-Up Shares that may be sold or transferred in the three-month period after the date of expiration of the Lock-up Period and in any such three-month period shall not exceed (i) that number of Lock-up Shares equal to 25% of the Stockholder’s Lock-up Shares held on the Effective Date (the “25% Limit”), for any Stockholder who is not an affiliate of the Company and (ii) the maximum amount permitted under applicable law or regulation for any Stockholder who is an “affiliate” in any 90-day period, provided that such maximum amount does not exceed the 25% Limit. The release dates, number of shares being released, and corresponding percentages of our 29,150,000 outstanding shares, are 594,012.5 shares (2.02%) 180 days after the Lock-up Period and 594,012.5 shares (2.02%) for each of the three (3) consecutive three-month periods after the date of expiration of the Lock-up Period.
 
SECURITIES AUTHORIZED UNDER EQUITY COMPENSATION PLANS
 
1.   ESTABLISHMENT AND PURPOSE
 
The Company’s  Employee, Director and Consultant Stock Plan (“The Plan’) was established in June of 2011 by the Company to attract and retain persons eligible to participate in the Plan, motivate Participants to achieve long-term Company goals, and further align Participants’ interests with those of the Company’s other stockholders. The Plan is adopted as of the Effective Time, subject to approval by the Company’s stockholders within 12 months before or after such adoption date. Unless the Plan is discontinued earlier by the Board as provided herein, no Award shall be granted hereunder on or after the date 10 years after the effective date.
 
2.  ADMINISTRATION; ELIGIBILITY
 
The Plan shall be administered by the Administrator; provided, however, that, if at any time no Committee shall be in office, the Plan shall be administered by the Board. The Plan may be administered by different Committees with respect to different groups of Eligible Individuals.
 
The Administrator shall have plenary authority to grant Awards pursuant to the terms of the Plan to Eligible Individuals; provided, however, that each Eligible Individual must be an officer, employee, director or consultant of the Company or of an Affiliate at the time the Award is granted. Notwithstanding the foregoing, the Administrator may authorize the grant of an Award to a person not then an officer, employee, director or consultant of the Company or of an Affiliate; provided, however, that the actual grant of such Award shall be conditioned upon such person becoming an Eligible Individual at or prior to the time the Award is granted. Participation shall be limited to such persons as are selected by the Administrator. The granting of any Award to any individual shall neither entitle that individual to, nor disqualify such individual from, participation in any other Awards.

3.  STOCK SUBJECT TO PLAN
 
Subject to adjustment as provided in this Section 4, the aggregate number of shares of Stock which may be delivered under the Plan shall not exceed a number equal to 25% of the total number of shares of Stock outstanding immediately following the Effective Time, assuming for this purpose the conversion into Stock of all outstanding securities that are convertible by their terms (directly or indirectly) into Stock; provided, however, that, as of January 1 of each calendar year, commencing with the year 2013, the maximum number of shares of Stock which may be delivered under the Plan shall automatically increase by a number sufficient to cause the number of shares of Stock covered by the Plan to equal 25% of the total number of shares of Stock then outstanding, assuming for this purpose the conversion into Stock of all outstanding securities that are convertible by their terms (directly or indirectly) into Stock.
 
 
17

 
 
To the extent any shares of Stock covered by an Award are not delivered to a Participant or beneficiary thereof because the Award expires, is forfeited, canceled or otherwise terminated, or the shares of Stock are not delivered because the Award is settled in cash or used to satisfy the applicable tax withholding obligation, such shares shall not be deemed to have been delivered for purposes of determining the maximum number of shares of Stock available for delivery under the Plan.
 
In the event of any Company stock dividend, stock split, combination or exchange of shares, recapitalization or other change in the capital structure of the Company, corporate separation or division of the Company (including, but not limited to, a split-up, spin-off, split-off or distribution to Company stockholders other than a normal cash dividend), sale by the Company of all or a substantial portion of its assets (measured on either a stand-alone or consolidated basis), reorganization, rights offering, partial or complete liquidation, or any other corporate transaction, Company share offering or other event involving the Company and having an effect similar to any of the foregoing, the Administrator may make such substitution or adjustments in the (A) number and kind of shares that may be delivered under the Plan, (B) additional maximums imposed in the immediately preceding paragraph, (C) number and kind of shares subject to outstanding Awards, (D) exercise price of outstanding Stock Options and Stock Appreciation Rights and (E) other characteristics or terms of the Awards as it may determine appropriate in its sole discretion to equitably reflect such corporate transaction, share offering or other event; provided, however, that the number of shares subject to any Award shall always be a whole number.
 
4.   STOCK OPTIONS
 
Stock Options may be granted alone or in addition to other Awards granted under the Plan and may be of two types: Incentive Stock Options and Non-Qualified Stock Options. Any Stock Option granted under the Plan shall be in such form as the Administrator may from time to time approve.
 
The Administrator shall have the authority to grant any Participant Incentive Stock Options, Non-Qualified Stock Options or both types of Stock Options (in each case with or without Stock Appreciation Rights). Incentive Stock Options may be granted only to employees of the Company and its Subsidiaries. To the extent that any Stock Option is not designated as an Incentive Stock Option or, even if so designated, does not qualify as an Incentive Stock Option, it shall constitute a Non-Qualified Stock Option. Incentive Stock Options may be granted only within 10 years from the date the Plan is adopted, or the date the Plan is approved by the Company’s stockholders, whichever is earlier.
 
Stock Options shall be evidenced by option agreements, each in a form approved by the Administrator. An option agreement shall indicate on its face whether it is intended to be an agreement for an Incentive Stock Option or a Non-Qualified Stock Option. The grant of a Stock Option shall occur as of the date the Administrator determines.
 
Anything in the Plan to the contrary notwithstanding, no term of the Plan relating to Incentive Stock Options shall be interpreted, amended or altered, nor shall any discretion or authority granted under the Plan be exercised, so as to disqualify the Plan under Section 422 of the Code or, without the consent of the Optionee affected, to disqualify any Incentive Stock Option under Section 422 of the Code.
 
5. STOCK APPRECIATION RIGHTS
 
Stock Appreciation Rights may be granted either on a stand-alone basis or in conjunction with all or part of any Stock Option granted under the Plan. In the case of a Non-Qualified Stock Option, such rights may be granted either at or after the time of grant of such Stock Option. In the case of an Incentive Stock Option, such rights may be granted only at the time of grant of such Stock Option. A Stock Appreciation Right shall terminate and no longer be exercisable as determined by the Administrator, or, if granted in conjunction with all or part of any Stock Option, upon the termination or exercise of the related Stock Option.
 
A Stock Appreciation Right may be exercised by a Participant as determined by the Administrator in accordance with this Section 6, and, if granted in conjunction with all or part of any Stock Option, by surrendering the applicable portion of the related Stock Option in accordance with procedures established by the Administrator. Upon such exercise and surrender, the Participant shall be entitled to receive an amount determined in the manner prescribed in this Section 6. Stock Options which have been so surrendered, if any, shall no longer be exercisable to the extent the related Stock Appreciation Rights have been exercised.
 
 
18

 
 
6. STOCK AWARDS OTHER THAN OPTIONS
 
Stock Awards may be directly issued under the Plan (without any intervening options), subject to such terms, conditions, performance requirements, restrictions, forfeiture provisions, contingencies and limitations as the Administrator shall determine. Stock Awards may be issued which are fully and immediately vested upon issuance or which vest in one or more installments over the Participant’s period of employment or other service to the Company or upon the attainment of specified performance objectives, or the Company may issue Stock Awards which entitle the Participant to receive a specified number of vested shares of Stock or cash, as determined by the Administrator, upon the attainment of one or more performance goals or service requirements established by the Administrator.
 
7. CHANGE IN CONTROL PROVISIONS
 
(a)
Impact of Event. Notwithstanding any other provision of the Plan to the contrary, in the event of a Change in Control:
 
 
(i)
Any Stock Options and Stock Appreciation Rights outstanding as of the date such Change in Control is determined to have occurred and not then exercisable and vested shall become fully exercisable and vested to the full extent of the original grant;
 
 
(ii)
The restrictions applicable to any outstanding Stock Award shall lapse, and the Stock relating to such Award shall become free of all restrictions and become fully vested and transferable to the full extent of the original grant;
 
 
(iii)
All outstanding repurchase rights of the Company with respect to any outstanding Awards shall terminate; and
 
 
(iv)
Outstanding Awards shall be subject to any agreement of merger or reorganization that effects such Change in Control, which agreement shall provide for:
 
 
(A)
The continuation of the outstanding Awards by the Company, if the Company is a surviving corporation,
 
 
(B)
The assumption of the outstanding awards by the surviving corporation or its parent or subsidiary;
 
 
(C)
The substitution by the surviving corporation or its parent or subsidiary of equivalent awards for the outstanding Awards; or
 
 
(D)
Settlement of each share of Stock subject to an outstanding Award for the Change in Control Price (less, to the extent applicable, the per share exercise price).
 
 
(v)
In the absence of any agreement of merger or reorganization effecting such Change in Control, each share of Stock subject to an outstanding Award shall be settled for the Change in Control Price (less, to the extent applicable, the per share exercise price), or, if the per share exercise price equals or exceeds the Change in Control Price, the outstanding Award shall terminate and be canceled.
 
 8. MISCELLANEOUS
 
(a)
Amendment. The Board may amend or alter the Plan or any Award, but no amendment or alteration shall be made which would adversely affect the rights of a Participant under an Award theretofore granted without the Participant’s consent, except such an amendment (i) made to avoid an expense charge to the Company or an Affiliate, or (ii) made to permit the Company or an Affiliate to claim a deduction under, or otherwise comply with, the Code (including, but not limited to, Section 409A of the Code). No such amendment shall be made without the approval of the Company’s stockholders to the extent such approval is required by law, agreement or the rules of any stock exchange or market on which the Stock is listed.
 
 
 
19

 
 
ITEM 6.  SELECTED FINANCIAL DATA
 
Not applicable.  

ITEM 7.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 
OVERVIEW
 
Management’s Discussion and Analysis of Financial Condition and Results of Operations

Our discussion includes forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements made which are not purely historical are forward-looking, and are based upon current expectations that involve risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated or implied in these forward-looking statements as a result of a number of factors, including those set forth In Item 1A -“Risk Factors” of this Annual Report on Form 10-K.  We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions to identify forward-looking statements.
 
PLAN OF OPERATION

Overview

The Real Hip-Hop Network (“RHN”) is an emerging growth company that provides family-appropriate (family-appropriate “meaning it is considered suitable for all members of the average family”) Hip-Hop content to a multi-racial/multi-generational demographic through multiple distribution platforms that initially include cable television, and the Company’s website RHN.TV that is designed to be the Internet destination for the Company’s target audiences. The Company also intends to utilize broadband, digital and wireless platforms to deliver music, gaming and steaming video to mobile devices and in home gaming systems within the next twelve months. RHN currently has exclusive rights to approximately 30,000 hours of content (3.4 years) and the Company has beta tested the delivery of live streaming version of its video content on the Company’s website RHN.TV. The Company intends to launch commercially through national subscription TV that is estimated to be the second quarter of 2014. The Company currently has contracts with DirecTV and DISH Network, which will allow the Company to launch commercially to a viewership of an estimated 32 million subscribers. The Company has started testing the content feed to both DirecTV and DISH Network and it is estimated that the testing will be completed by the end April, 2014 with no cost to the Company.

Through the License Agreement the Company was assigned binding and enforceable contract with DirecTV, the term of the agreement is for the period commencing on May 8, 2013 and ending on the first anniversary of the Service Commencement Date, which is anticipated to be April of 2014 (the “Term”). DirecTVshall have the option to extend the Agreement for one (1) additional year upon notice to the Company at least sixty (60) days prior to the scheduled expiration of the Term (and the “Term” shall be deemed to include any such extension period). The “Service Commencement Date” means the date on which DirecTV commences distribution of the Service via the DirecTV Distribution System for revenue-generating purposes, which date shall be on or about December 1, 2013. Furthermore, the Company was assigned binding and enforceable contract with DISH Network that began May 1, 2013 and expires February 28, 2015. The contracts with DirecTV and DISH Network are intended allow the Company to launch commercially to a viewership of an estimated 32 million subscribers. The Company has started testing the content feed to both DirecTV and DISH Network and it is estimated that the testing will be completed by the end April, 2014 with no cost to the Company.

Upon completion of testing with DirecTV, the Company agreed to pay a non-refundable deposit to DirecTV of $522,000 and $261,000 per week the first year, $371,000 per week the second year and $391,000 per week the third year for services (all weekly payments are due two weeks in advance of content distribution). The services consist of a national feed to an estimated 18,411,000 million households of the programming service currently known as the “Real Hip-Hop Network” and/or “RHN”, which shall consist exclusively of the type of programming described herein, presented on a 24-hour per day, 7 days a week schedule to reach all DirecTV subscribers in the United States on an exclusive designated channel determined by DirecTV. Upon completion of testing with Dish Network, the Company agreed to pay a non-refundable deposit to Dish Network of $1,500,000 and $1,166,000 per month for services (all monthly payments are due in advance of content distribution). The services consist of a national feed to an estimated 14,000,000 million households of the programming service currently known as the “Real Hip-Hop Network” and/or “RHN”, which shall consist exclusively of the type of programming described herein, presented on a 24-hour per day, 7 days a week schedule to reach all Dish Network subscribers in the United States on an exclusive designated channel determined by Dish Network. The Company began testing with the networks in August, 2013 and anticipated completion in November of 2013 and has been delay do to testing until the end of April 2014. The Company will not be able to launch it content on either network until the aforementioned deposits and monthly fees can be paid.  The Company currently has no cash or ability to pay the network fees and is relying on the primary offering in this prospectus to meet the obligations. Pursuant to the agreements there are customary representations and warranties of each of the parties and can be terminate by either party with thirty days written notice.

The company is operating independently of SSM Media the majority stockholder and The Real Hip-Hop Network, Broadcast Corp, the Licensor.
 
 
20

 

The Company intends to provide a mix of approximately 45% music video-based entertainment, approximately 55% of RHN’s lineup includes original programming revolving around the Hip-Hop lifestyle, culture and pro-social programs, such as first run movies, live concerts, break-dance battles, rhyme competitions, documentaries, news, DJ competitions, interviews and exciting original content. We are currently evaluating all our options to commercialize our licensed content and platforms. The Company’s concept and content has been beta tested and has not been deployed for commercial sale anywhere in the world. Although the Company’s technology and platform in ready for deployment each country have different requirements for deployment, so the commercialization process is likely to be lengthy and complex. The Company may employ different strategies in different areas of the world, such as sublicensing deployment and commercialization rights for some territories while retaining rights for other territories.
 
Our primary sources of revenue is intended to come from affiliate fees and advertising. The Company anticipates the first one to three years of revenues will be generated by advertising as we will be paying the providers for the distribution of our content and for the third year and beyond after the Company establishes rating scores the Company intends on generating Affiliate revenues.   Affiliate revenues are derived from long-term distribution agreements with cable, satellite and telecommunications operators who pay us a monthly fee for each subscriber household that receives RHN content. 

On August 15, 2011, the Company entered into a Licensing Agreement (“Licensing Agreement”) that was amended on August 14, 2013 with The Real Hip-Hop Network, Broadcast Corp (“Licensor”) pursuant to which the Company was granted an exclusive, non-transferrable worldwide license for certain first run movies, live concerts, break-dance battles, rhyme competitions, documentaries, news, DJ competitions and interviews (“media content”), distribution platforms, patents, intellectual property, know-how, trade secret information to provide intelligent, family-appropriate Hip-Hop content to a multi-racial/multi-generational demographic.
 
Except for the rights granted under the License Agreement, Licensor retains all rights, title and interest to the content and any additions thereto—although the License includes the Company’s right to utilize such additions. The term of the License commences on the date of the Licensing Agreement and continues for thirty (30) years, provided that the Licensee is not in breach or default of any of the terms or conditions contained in this Agreement.  In addition to other requirements, the continuation of the License is conditioned on the Company generating net revenues in the normal course of operations or the funding by the Company of specified amounts for qualifying distribution and commercialization expenses related to the media content. In addition, the Company is required to fund certain specified expenses related to the distribution of the media content as specified in the License Agreement. The license is terminated upon the occurrence of events of default specified in the License Agreement and outlined as followed: If any of the Parties are in breach or default of the terms or conditions contained in this Agreement and do not rectify or remedy that breach or default within 90 days from the date of receipt of notice by the other party requiring that default or breach to be remedied, then the other party may give to the party in default a notice in writing terminating this Agreement.

The Company will not be able to commercialize either its media content or distribution platforms without additional capital, if we do not raise at least Five Hundred Thousand Dollars ($500,000) for its future development before August 15, 2014, raise at least Five Hundred Thousand Dollars ($500,000) for its future deployment before August 15, 2015, and raise at least One Million Dollars ($1,000,000) for its future deployment before August 15, 2016 equaling the minimum funding requirement of Two Million Dollars ($2,000,000) for the deployment of its content distribution over the next three years or we will lose our rights to the media content and distribution platforms. Additionally, the Company will shall pay Licensor a royalty of one quarter of one percent (.25%) of all gross revenues resulting from the use of the Technology by Licensee and if the technology is sub-licensed form the Company, the Company shall pay Licensor a one percent (1%) royalty except as otherwise modified in writing. The Company will require significant additional financing in order to meet the milestones and requirements of its Business Plan and avoid discontinuation of the License.  Funding would be required for staffing, marketing, public relations and the necessary distribution to expanding the scope of its offering to include the global market. The Company intends to seek at an aggregate of $25,000,000 in 2014 through the sale of equity or convertible debt securities, the issuance of these securities could dilute existing shareholders. The Company’s funding plans include selling additional capital stock and/or borrowing to fund the aforementioned expenses. The Company intends to approach Hedge Funds, Venture Capital Groups, Private Investment Groups and other Institutional Investment Groups in its efforts to achieve future funding.
 
 
21

 
 
It is estimated that $2,755,548 will be used for sales and marketing, $12,930,077 will be used for the TV network fees, an estimated $2,049,325 will be spent on management, legal, accounting, rent, financing fees and other payables, $ 16,889 will be spent on this offering and $3,589,520 will be spent on production and programming leaving $3,658,641 in reserve for increased working capital.
  
There is no guarantee that the Company will be able to raise this or any amount of additional capital and a failure to do so would have a significant adverse effect on the Company’s ability, or would cause significant delays in its ability to address the market for the distribution of media content and achieve its Business Plan, it estimated the minimum amount of capital the company needs to raise over the ne twelve months is $2 million to continue operations. Neither the Company nor any of its advisors or consultants has significant experience in raising funds similar to the $25,000,000 estimated to be required.
 
Going Concern

We have incurred net losses of approximately $140,391 since inception through March 31, 2014. At March 31, 2014 we had no cash and no other assets and our total liabilities were approximately $135,626. The report of our independent registered public accounting firm on our financial statements from inception through March 31, 2014 contains an explanatory paragraph regarding our ability to continue as a going concern based upon recurring operating losses and our need to obtain additional financing to sustain operations. Our ability to continue as a going concern is dependent upon our ability to obtain the necessary financing to meet our obligations and repay our liabilities when they become due and to generate sufficient revenues from our operations to pay our operating expenses. There are no assurances that we will continue as a going concern.

Results of Operations

The following is a summary of the Company’s operation results for the years ended March 31, 2014 and 2013:

   
2014
   
2013
 
             
Total operating expenses
 
$
26,000
   
$
37,880
 
Total other income (expense)
   
        ---
     
   --
 
Net loss
 
$
(26,000)
   
$
(37,880)
 

The Company has conducted minimal operations since inception. No revenue has been generated by the Company from May 4, 2010 (Inception) to March 31, 2014.

Net loss decreased by $11,880 from 2012 to 2013 was due to the decrease general and administrative expenses, respectively.
General and administrative expenses were lower in 2014 compared 2013 because we had fewer organizational expenses for company for the fiscal 2014 periods, We incurred travel costs as we seek to secure funding for the deployment and commercialization of our products and we incurred lower costs to prepare and file our current and periodic reports with the SEC in the fiscal 2014 periods.
 
 
22

 

The following is a summary of the Company’s operation results for the year ended March 31, 2014 and 2013:

   
Year ended March 31,
   
$
 
   
2014
   
2013
   
Variance
 
General and administrative
 
$
26,000  
   
$
37,880
   
$
11,880
 
Net Loss
 
$
(26,000)
   
$
(37,880)
         

The Company is still in development stage, and no revenue has been generated since the inception of the Company on May 4, 2010.

During the three months ended March 31, 2014, which was the fourth quarter of our fiscal year ending March 31, 2014, we had no revenue and incurred general and administrative expenses of $0. Our net loss was $0.

For the year ended March 31, 2014, we had no revenue and incurred general and administrative expenses of $26,000. Our net loss was $26,000, due to general and administrative expenses. General and administrative expenses for the year ended of fiscal 2014 consisted of $26,000 for travel and administrative support, which mostly consisted of document preparation and EDGAR filing with the SEC.

For the period from inception (May 4, 2010) through March 31, 2014, the Company had no activities that produced revenues from operations and had a net loss of $(140,391), consisted of legal, accounting, audits and other professional service fees incurred in relation to the formation of the Company and the filing of the Company’s Registration Statement on Form 10 filed in May 2010, our Form S-1 filed in August of 2013 and other SEC-related compliance matters.
 
For the year ended March 31, 2014, the Company did not enter into any stock-based agreements and for the year ended March 31, 2013, the Company entered into an agreement under which it agreed to grant stock-based compensation to Accelerated Venture Partners (AVP) for extending consulting services to the Company. Pursuant to the terms of the agreement, the Company agreed to grant AVP 3,800,000 shares of common stock at an exercise price of $.0001 per share.
 
The Company has estimated the value of common stock into which the stock was granted to AVP at $.0001 per share for financial reporting purposes. This amount was determined based management’s estimate of fair value of stock options granted in the current and prior year as approximating par value. The stock based compensation expense is an estimate and significant judgment was involved in attempting to determine the value of common stock.

The Company’s common stock has never traded publicly, and no stock has traded in private markets either, except for privately negotiated sales to investors, the founder of the Company and the founder of the technology from which the Company subsequently licensed rights. No common stock has been sold in any transactions since the Company emerged from its shell-company status. The Company does not have any offers for purchase of its common stock in any stage, and no stock is registered for resale with the Securities and Exchange Commission.
 
The Company believes the only material estimate used in estimating the fair value stock options was the estimated fair value of the common stock, and that assumed volatility, term, interest rate and dividend of yield changes would be not result in material differences in stock option valuations. Based on the assumed value of common stock, the grant-date fair value of stock granted during the year ended March 31, 2013 was $380. The Company recognized stock-based compensation expense of $380 during the six months ended September 30, 2012, respectively, which was all included in general and administrative expenses. General and administrative expenses were lower for the six month period ended in September 30, 2013 compared to September 30, 2012 due to lower professional fees. We expect that, if we are successful in securing additional capital, future general and administrative expenses will increase significantly as compared to the six month period ended September 30, 2012. In addition, we expect to incur development expenses as we seek to advance our products.
 
Liquidity and Capital Resources

As of March 31, 2014, we had a cash balance of only $0. There were no other assets, and accrued expenses were $135,626, all due to AVP, a related party. We had a stockholders’ deficit of approximately $135,626 and no means to pay the liabilities in excess of our assets. AVP has agreed to fund certain administrative operating expenses of RHN until the Company succeeds in raising additional funds, at which point the administrative operating expenses will be due. However, AVP may seek to force earlier payment of the amounts which we owe, or AVP may decide in the future not to continue funding costs on behalf of RHN, although we are not aware of any plans for them to do so. If we are not successful in raising additional capital, we may not be able to pay our liabilities and may have to cease operations.
 
 
23

 
 
Funding would be required for staffing, marketing, public relations and the necessary distribution to expanding the scope of its offering to include the global market. The Company intends to seek an aggregate of $25,000,000 in 2014 through the sale of equity or convertible debt securities, the issuance of these securities could dilute existing shareholders. The Company’s funding plans include selling additional capital stock and/or borrowing to fund the aforementioned expenses. The Company intends to approach Hedge Funds, Venture Capital Groups, Private Investment Groups and other Institutional Investment Groups in its efforts to achieve future funding. It estimated the minimum amount of capital the Company needs to raise over the next twelve months is $2 million to continue operations. There is no guarantee that the Company will be able to raise this or any amount of additional capital and a failure to do so would have a significant adverse effect on the Company’s ability, or would cause significant delays in its ability to address the market and achieve its Business Plan. Neither the Company nor any of its advisors or consultants has significant experience in raising funds similar to the $25,000,000 estimated to be required.

We have a consulting agreement with AVP under which AVP has agreed to provide us with certain advisory services that include reviewing our business plan, identifying and introducing prospective financial and business partners, and providing general business advice regarding our operations and business strategy. Under the consulting agreement, cash compensation of $800,000 is due to AVP upon our securing $10 million in available cash from funding, and an additional $800,000 is due upon our securing $20 million in available cash from funding (inclusive of the first $10 million). The cash compensation is to be paid to AVP at the rate of $66,667 per month. The total cash compensation to be received by AVP under the consulting agreement is not to exceed $2,400,000 unless we receive an amount of funding in excess of $30 million. If we receive equity or debt financing that is an amount less than $10 million, in between $10 million and $30 million, or greater than $30 million, the cash compensation earned by the AVP under its consulting services agreement will be prorated. We have the option to make a lump sum payment to AVP in lieu of the monthly cash payments.

We plan to measure our future liquidity primarily by the cash and working capital available to fund our operations, if do not have enough capital available to fund our operations, as stated above. We will not be able to commercialize our products without additional capital. We are evaluating various means of raising our initial capital, including through the sale of equity securities, licensing agreements or other means. We expect to incur losses for at least several years into the future as we develop our products and we are unable to estimate when, if ever, we will receive revenue or have a positive cash flow.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors. 

Seasonality
 
Our operating results are not affected by seasonality.

Inflation

Our business and operating results are not affected in any material way by inflation.

Critical Accounting Policies

Basis of Presentation

The financial statements of the Corporation have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars. The Corporation's year end is March.
 
 
24

 
 
Cash and Cash Equivalents

The Corporation considers all highly liquid investments with original maturity of three months or less to be cash equivalents.

Use of Estimates and Assumptions

The preparation of our financial statements is in conformity with generally accepted accounting principles which 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 period. Actual results could differ from those estimates.

Foreign Currency Translations

The financial statements are presented in United States dollars. In accordance with Statement of Financial Accounting Standards No. 52, “Foreign Currency Translation”, foreign denominated monetary assets and liabilities are translated into their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date. Revenue and expenses are translated at average rates of exchange during the year. Gains or losses resulting from foreign currency transactions are included in results of operations.

Fair Value of Financial Instruments

Our financial instruments consist of cash and accounts payable. Unless otherwise noted, it is management's opinion the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments. Because of the short maturity of such assets and liabilities the fair value of these financial instruments approximate their carrying values, unless otherwise noted.

Income Taxes

Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. We have adopted ASC Topic “Accounting for Income Taxes” (SFAS No. 109) as of its inception. Pursuant to SFAS No. 109 the Corporation is required to compute tax asset benefits for net operating losses carried forward.

Basic and Diluted Net Income (Loss) Per Share

The Corporation computes net income (loss) per share in accordance with ASC Topic 128, “Earnings per Share” (SFAS 128). ASC Topic 128 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of common shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including stock options, using the treasury stock method, and convertible preferred stock, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential common shares if their effect is anti-dilutive.

Recent Accounting Pronouncements

The Corporation does not expect the adoption of recently issued accounting pronouncements to have a significant impact on its results of operations, financial position or cash flow.
 

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 
Not applicable.


 
25

 
 
 
ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA



THE REAL HIP-HOP NETWORK, INC.

- INDEX TO FINANCIAL STATEMENTS -
 
 
Page(s)
   
Report of Independent Registered Public Accounting Firm
  F-2
   
Balance Sheets as of March 31, 2014 and March 31, 2013
  F-3
   
Statement of Operations for the year ended March 31, 2014, and March 31, 2013 and from inception (May 4, 2010) through March 31, 2014
  F-4
   
Statement of Stockholders’ Deficit for the period from inception (May 4, 2010) through March 31, 2014
  F-5
   
Statement of Cash Flows for the year ended March 31, 2014, and March 31, 2013 and from inception (May 4, 2010) through March 31, 2014
  F-6
   
Notes to Financial Statements
  F-7
   
 

 
 
 
26

 
 

 

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders
The Real Hip-Hop Network, Inc.
(Formally known as Accelerated Acquisition XII, Inc.)
 (A Development Stage Company)

We have audited the accompanying balance sheets of The Real Hip-Hop Network, Inc.(a development stage company) as of March 31, 2014 and 2013, and the related statements of operations, stockholder's deficit and cash flows for the years then ended and for the period from inception (May 4, 2010) to March 31, 2014. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as, evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of The Real Hip-Hop Network, Inc. (a development stage company) as of March 31, 2014 and 2013 and the results of its operations and its cash flows for the years then ended and for the period from inception (May 4, 2010) to March 31, 2014 in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has incurred a loss since inception, has a net accumulated deficit and may be unable to raise further equity. These factors raise substantial doubt about its ability to continue as a going concern. Management’s plans regarding those matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

/s/ Anton & Chia LLP

Newport Beach, CA
June 30, 2014

 
 
 
27

 
 
 
THE REAL HIP-HOP NETWORK, INC
 
(Formerly known as Accelerated Acquisitions XII, Inc.)
 
(A Development Stage Company)
 
BALANCE SHEETS
 
   
 
March 31,
 
March 31,
 
 
2014
 
2013
 
         
ASSETS
           
        Current assets:
           
        Cash
 
$
-
   
$
-
 
                 
   
$
-
   
$
-
 
LIABILITIES AND STOCKHOLDERS’ DEFICIT
               
        Current liabilities:
               
                 
        Due to related party
 
$
135,626
   
$
109,626
 
                 
        Total liabilities
   
135,626
     
109,626
 
                 
        Stockholders’ deficit:
               
        Preferred stock, $0.0001 par value, 10,000,000 shares authorized;
               
        none issued or outstanding
   
-
     
-
 
        Common stock, $0.0001 par value, 100,000,000 shares authorized, 29,150,000
        shares issued and outstanding as of March 31, 2014 and 2013
   
2,915
     
2,915
 
        Additional paid-in capital
   
1,850
     
1,850
 
        Accumulated deficit
   
(140,391
)
   
(114,391
)
                 
        Total stockholders’ deficit
   
(135,626
)
   
(109,626
)
                 
   
$
-
   
$
-
 
                 
The accompanying notes are an integral part of these financial statements.
 
 
 
28

 
 
THE REAL HIP-HOP NETWORK, INC.
(Formerly known as Accelerated Acquisitions XII, Inc.)
(A Development Stage Company)
STATEMENTS OF OPERATIONS
 
               
Inception
 
   
Year Ended
 March 31,
   
Year Ended
 March 31,
   
(May 4, 2010) through
 
 
2014
   
2013
   
March 31, 2014
 
                   
Revenues
 
$
-
   
$
-
   
$
-
 
                         
Operating expenses
   
-
     
-
     
-
 
                         
General and administrative
   
26,000
     
37,880
     
140,391
 
                         
Total operating expenses
   
26,000
     
37,880
     
140,391
 
                         
Net loss
 
$
(26,000
)
 
$
(37,880
)
 
$
(140,391
)
                         
Basic and diluted net loss per share
 
$
-
     
-
     
-
 
                         
Weighted average number of common shares outstanding
   
29,150,000
     
29,150,000
         
                         

The accompanying notes are an integral part of these financial statements.
 
 
29

 
 
THE REAL HIP-HOP NETWORK, INC.
 
(Formerly known as Accelerated Acquisitions XII, Inc.)
 
(A Development Stage Company)
 
CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT
 
 
                               
                               
                           
Total
 
   
Common stock
   
Additional
   
Accumulated
   
Stockholders'
 
   
Shares
   
Amount
   
Paid-In Capital
   
Deficit
   
Deficit
 
                                         
Balance at inception
 
$
-
   
$
-
   
$
-
   
$
-
   
$
-
 
                                         
Issuance of common stock
                                       
to founder for cash, May 4, 2010
                                       
at $ .0004 per share
   
5,000,000
     
500
     
1,500
     
-
     
2,000
 
                                         
Net loss
                           
(1,800
)
   
(1,800
)
                                         
Balances at March 31, 2011
   
5,000,000
     
500
     
1,500
     
(1,800
)
   
200
 
                                         
Tender of shares by founder, July 16, 2011
                                       
at $ .0001 per share
   
(3,500,000
)
   
(350
)
   
350
     
-
     
-
 
                                         
Issuance of common stock under stock
                                       
option granted to founder for consulting
                                       
services
   
1,500,000
     
150
     
-
     
-
     
150
 
                                         
Issuance of common stock under stock
                                       
option granted to founder for consulting
                                       
services, July 16, 2011 at $ .0001 per share
   
22,350,000
     
2,235
     
-
     
-
     
2,235
 
                                         
Net loss
   
-
     
-
     
-
     
(74,711
)
   
(74,711
)
                                         
Balances at March 31, 2012
   
25,350,000
     
2,535
     
1,850
     
(76,511
)
   
(72,126
)
                                         
Issuance of common stock under stock
                                       
option granted to founder for consulting
                                       
services, June 20, 2012 at $.0001 per share
   
3,800,000
     
380
     
-
     
-
     
380
 
                                         
Net loss 
   
-
     
-
     
-
     
(37,880
)
   
(37,880
)
                                         
Balances at March 31, 2013
   
29,150,000
   
$
2,915
   
$
1,850
   
$
(114,391
)
 
$
(109,626
)
                                         
Net loss 
   
 -
     
 -
     
 -
     
(26,000
   
(26,000
                                         
Balances at March 31, 2014
   
29,150,000
   
$
2,915
   
$
1,850
   
$
(140,391
)
 
$
(135,626
)
 
The accompanying notes are an integral part of these financial statements.
 
 
 
 
30

 
 
 
THE REAL HIP-HOP NETWORK, INC.
 
(A Development Stage Company)
 
STATEMENTS OF CASH FLOWS
 
 
         
Cumulative since
 
         
May 4, 2010
 
   
Year Ended
   
( inception) to
 
   
March 31,
2014
   
March 31,
2013
   
March 31,
2014
 
Operating Activities
                 
                   
Net loss
  $ (26,000 )   $ (37,880 )   $ (140,391 )
Due to Shareholder
          37,476        
Stock-based compensation
    -       380       380  
Increase in accrued expenses due to founder
    26,000       -       135,626  
Net cash used in operations
    -       (24 )     (4,385 )
                         
Financing Activities
                       
                         
Proceeds from the issuance of common stock
    -       -       4,385  
                         
Net decrease in cash and cash equivalents
    -       (24     -  
Cash at the beginning of the period:
  -     24     -  
Cash at the end of the period
  -     -     -  
 
The accompanying notes are an integral part of these financial statements.
 
 
 
 
31

 
 


 THE REAL HIP-HOP NETWORK, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2014
 
 
1. Basis of Presentation and Summary of Significant Accounting Policies
 
(a)       Company Description
 
The Real Hip-Hop Network (“RHN”, or the “Company”) is an emerging growth company that intends to provide family-appropriate (family-appropriate “meaning it is considered suitable for all members of the average family”) Hip-Hop content to a multi-racial/multi-generational demographic through multiple distribution platforms that will initially include cable/satellite television, and through the Company’s website at RHN.TV.  The Company also intends to utilize broadband, digital and wireless platforms to deliver music, gaming and streaming video to mobile devices and in home gaming systems.  RHN currently has exclusive rights to approximately 30,000 hours of content, which is equivalent to 3.4 years. The Company intends to launch commercially through national subscription TV, estimated within the second quarter of 2014.  The Company has beta tested the delivery of live streaming version of its video content on the Company’s website RHN.TV.   
 
The Company intends to provide a mix of approximately 45% music video-based entertainment, approximately 55% of RHN’s lineup includes original programming revolving around the Hip-Hop lifestyle, culture and pro-social programs, such as first run movies, live concerts, break-dance battles, rhyme competitions, documentaries, news, DJ competitions, interviews and exciting original content. We are currently evaluating all our options to commercialize our licensed content and platforms. The Company’s concept and content has been beta tested and has not been deployed for commercial sale anywhere in the world. Although the Company’s technology and platform is ready for deployment each country has different requirements for deployment, so the commercialization process is likely to be lengthy and complex. The Company may employ different strategies in different areas of the world, such as sublicensing deployment and commercialization rights for some territories while retaining rights for other territories.

Our primary sources of revenue are affiliate fees and advertising. Affiliate fees are derived from long-term distribution agreements with cable, satellite and telecommunications operators who pay us a monthly fee for each subscriber household that receives RHN content. We have not generated revenues since our inception.

(b)
Basis of Presentation
The accompanying financial statements have been prepared in accordance with United States generally accepted accounting principles ("U.S. GAAP").
 
 (c)
Use of Estimates:
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
 
 (d)
Emerging Growth Company
We are an “emerging growth company,” as defined in the Jumpstart our Business Startups Act of 2012, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden
parachute payments not previously approved.

Under the Jumpstart Our Business Startups Act, “emerging growth companies” can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected not to avail ourselves to this exemption from new or revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not “emerging growth companies.”

(e)
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.  The Company did not have cash equivalents as of March 31, 2014 and March 31, 2013.
 
 
32

 
 
THE REAL HIP-HOP NETWORK, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2014

 
(f)
Loss per Common Share
Basic loss per share is calculated using the weighted-average number of common shares outstanding during each reporting period. Diluted per share includes potentially dilutive securities such as outstanding options and warrants, using various methods such as the treasury stock or modified treasury stock method in the determination of dilutive shares outstanding during each reporting period.  The Company has incurred a loss during the current period, therefore any potentially dilutive shares are excluded, as they would be anti-dilutive. The Company does not have any potentially dilutive instruments for this reporting period.
 
(g)
Fair Value of Financial Instruments
The Company follows guidance for accounting for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Additionally, the Company adopted guidance for fair value measurement related to nonfinancial items that are recognized and disclosed at fair value in the financial statements on a nonrecurring basis. The guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:
 
•  Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
 
•  Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
 
•  Level 3 inputs are unobservable inputs for the asset or liability.
 
The carrying amounts of financial assets such as cash approximate their fair values because of the short maturity of these instruments.

(h)
Recent Accounting Pronouncements
 
Adopted
 
Effective January 2013, we adopted FASB ASU No. 2011-11, Balance Sheet (Topic 210):  Disclosures about Offsetting Assets and Liabilities (ASU 2011-11).  The amendments in ASU 2011-11 require the disclosure of information on offsetting and related arrangements for financial and derivative instruments to enable users of its financial statements to understand the effect of those arrangements on its financial position.  Amendments under ASU 2011-11 will be applied retrospectively for fiscal years, and interim periods within those years, beginning after January 1, 2013.  The adoption of this update did not have a material impact on the financial statements.
 
Effective January 2013, we adopted FASB ASU No. 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (ASU 2013-02).  This guidance is the culmination of the FASB’s deliberation on reporting reclassification adjustments from accumulated other comprehensive income (AOCI).  The amendments in ASU 2013-02 do not change the current requirements for reporting net income or other comprehensive income.  However, the amendments require disclosure of amounts reclassified out of AOCI in its entirety, by component, on the face of the statement of operations or in the notes thereto.  Amounts that are not required to be reclassified in their entirety to net income must be cross-referenced to other disclosures that provide additional detail.  This standard is effective prospectively for annual and interim reporting periods beginning after December 15, 2012.  The adoption of this update did not have a material impact on the financial statements.
 
 
 
 
33

 
 


THE REAL HIP-HOP NETWORK, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2014

 
Not Adopted
 
In February 2013, the FASB issued ASU No. 2013-04, Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date. The amendments in ASU 2013-04 provide guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this Update is fixed at the reporting date, except for obligations addressed within existing guidance in U.S. GAAP. The guidance requires an entity to measure those obligations as the  sum of the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors and any additional amount the reporting entity expects to pay on behalf of its co-obligors. The guidance in this Update also requires an entity to disclose the nature and amount of the obligation as well as other information about those obligations. The amendments in this standard are effective retrospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013. We are evaluating the effect, if any, adoption of ASU No. 2013-04 will have on our financial statements.
 
In March 2013, the FASB issued ASU No. 2013-05, Foreign Currency Matters (Topic 830): Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. The amendments in ASU No. 2013-05 resolve the diversity in practice about whether Subtopic 810-10, Consolidation—Overall, or Subtopic 830-30, Foreign Currency Matters—Translation of Financial Statements, applies to the release of the cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business (other than a sale of in substance real estate or conveyance of oil and gas mineral rights) within a foreign entity. In addition, the amendments in this Update resolve the diversity in practice for the treatment of business combinations achieved in stages (sometimes also referred to as step acquisitions) involving a foreign entity. The amendments in this standard are effective prospectively for fiscal years, and interim reporting periods within those years, beginning December 15, 2013. We are evaluating the effect, if any, adoption of ASU No. 2013-05 will have on our financial statements.
 
In April 2013, the FASB issued ASU No. 2013-07, Presentation of Financial Statements (Top 205): Liquidation Basis of Accounting. The objective of ASU No. 2013-07 is to clarify when an entity should apply the liquidation basis of accounting and to provide principles for the measurement of assets and liabilities under the liquidation basis of accounting, as well as any required disclosures. The amendments in this standard is effective prospectively for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein. We are evaluating the effect, if any, adoption of ASU No. 2013-07 will have on our financial statements.
 
Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), and the United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company's present or future financial statements.
 
NOTE 2 - GOING CONCERN
 
The accompanying financial statements have been prepared on a going concern basis, which assumes the Company will realize its assets and discharge its liabilities in the normal course of business. As reflected in the accompanying financial statements, the Company has a deficit accumulated during the development stage of $140,391, due to shareholder of $135,626 and had $0 cash as of March 31, 2014. The Company’s ability to continue as a going concern is dependent upon its ability to obtain financing necessary for it to meet its obligations, develop the products that it has licensed, and ultimately generate revenues from the sale of these products. The Company’s founder has agreed to fund certain administrative operating expenses of the Company until the Company succeeds in raising additional funds. Management’s plans include raising additional funds through an equity financing or licensing transaction in order to meet the Company’s obligations and develop its product candidates, but funding may not be available and the Company may be unsuccessful in raising additional capital of any type. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might arise as a result of this uncertainty.

 
 
 
34

 
 
 
THE REAL HIP-HOP NETWORK, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2014

 
NOTE 3 - STOCK-BASED COMPENSATION

The Company recognizes stock-based compensation expense in its statement of operations based on estimates of the fair value of employee stock option and stock grant awards as measured on the grant date. During the year ended March 31, 2014, the Company entered into an agreement under which it agreed to grant stock-based compensation to Accelerated Venture Partners (AVP) for extending consulting services to the Company. Pursuant to the terms of the agreement the Company agreed to grant AVP 3,800,000 shares of common stock at a purchase price of $.0001 per share. The Company recognized stock-based compensation expense of $380 for the year ended March 31, 2013, respectively, which was all included in general and administrative expenses.  Stock options and other stock-based awards granted to employees, directors and/or consultants will be accounted for using an estimate of the fair value of the stock award on the date it is granted. The estimated fair value of the award on the grant date will be recognized the consolidated statement of operations on a straight-line basis over the vesting period of the underlying stock award.

NOTE 4 - STOCK AND STOCK TRANSACTIONS

Preferred Stock

The Company has authorized 10,000,000 shares of preferred stock, with a par value of $0.0001 per share. The Company’s Board of Directors has the ability to determine the rights and preferences of any series of preferred stock issued. There are no shares of preferred stock currently issued or outstanding.
Common Stock

The Company has authorized 100,000,000 shares of common stock, with a par value of $0.0001 per share.

At inception (May 4, 2010), the Company issued 5,000,000 shares of common stock to Accelerated Venture Partners, LLC (“AVP”) for $2,000.

On July 16, 2011, SSM Media Ventures, Inc. (“Purchaser”) agreed to acquire 22,350,000 shares of the Company’s common stock par value $0.0001 for a price of $0.0001 per share. At the same time, Accelerated Venture Partners, LLC agreed to tender 3,500,000 of their 5,000,000 shares of the Company’s common stock par value $0.0001 for cancellation. Following these transactions, SSM Media Ventures owned approximately 94% of the Company’s 23,850,000 issued and outstanding shares of common stock par value $0.0001 and the interest of Accelerated Venture Partners, LLC was reduced to approximately 6% of the total issued and outstanding shares. Simultaneously with the share purchase, Timothy Neher resigned from the Company’s Board of Directors and Atonn Muhammad was simultaneously appointed to the Company’s Board of Directors. Such action represents a change of control of the Company.

The Purchaser used its working capital to acquire the Shares. The Purchaser did not borrow any funds to acquire the Shares. Prior to the purchase of the shares, the Purchaser was not affiliated with the Company. However, the Purchaser will be deemed an affiliate of the Company after the share purchase as a result of its stock ownership interest in the Company. The purchase of the shares by the Purchaser was completed pursuant to written Subscription Agreements with the Company. The purchase was not subject to any other terms and conditions other than the sale of the shares in exchange for the cash payment. The Company intends to file a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of Delaware in order to change its name to “Real Hip-Hop Network, Inc.”.

On July 18, 2011, the Company entered into a Consulting Services Agreement with Accelerated Venture Partners LLC (“AVP”), a company controlled by Timothy J. Neher. The agreement requires AVP to provide the Company with certain advisory services that include reviewing the Company’s business plan, identifying and introducing prospective financial and business partners, and providing general business advice regarding the Company’s operations and business strategy in consideration of (a) an option granted by the Company to AVP to purchase 1,500,000 shares of the Company’s common stock at a price of $0.0001 per share (the “AVP Option”) (which was immediately exercised by the holder) subject to a repurchase option granted to the Company to repurchase the shares at a price of $0.0001 per share in the event the Company fails to complete funding as detailed in the agreement subject to the following milestones:
.
 
 
 
35

 
 
 
THE REAL HIP-HOP NETWORK, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2014


Milestone 1 -
Company’s right of repurchase will lapse with respect to 60% of the shares upon securing $10 million in available cash from funding;
Milestone 2 -
Company’s right of repurchase will lapse with respect to 20% of the Shares upon securing $20 million in available cash (inclusive of any amounts attributable to Milestone 1);
Milestone 3 -
Company’s right of repurchase will lapse with respect to 20% of the Shares upon securing $30 million in available cash (inclusive of any amounts attributable to Milestone 2);

On June 6, 2012 the Company fully vested 1,500,000 shares of common stock issued to AVP on July 18, 2011, when the Company entered into a Consulting Services Agreement with AVP.  The agreement requires AVP to provide the Company with certain advisory services that include reviewing the Company’s business plan, identifying and introducing prospective financial and business partners, and providing general business advice regarding the Company’s operations and business strategy. Furthermore, the Company issued AVP 3,800,000 shares of common stock at a par value of .0001 per share to AVP as an incentive to continued services.

As of March 31, 2014, there were 29,150,000 shares issued and outstanding and 5,962,500 shares of common stock were reserved for issuance under the Company’s Stock Option Plan. There were 64,887,500 shares of common stock available for future issuance.

NOTE 5. INCOME TAXES
 
The Company has incurred net operating losses since inception. The Company has not reflected any benefit of such net operating loss carry forward in the financial statements.  

In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income.

Based on the level of historical taxable losses and projections of future taxable income (losses) over the periods in which the deferred tax assets can be realized, management currently believes that it is more likely than not that the Company will not realize the benefits of these deductible differences. Accordingly, the Company has provided a valuation allowance against the gross deferred tax assets as follows:
 
   
March 31, 2014
   
March 31, 2013
 
Gross deferred tax assets 
 
$
140,391
   
$
114,391
 
Valuation allowance 
   
(140,391
)
   
(114,391
)
Net deferred tax asset 
 
$
   
$
 
 
As of March 31, 2014 and 2013, the Company had a net operating loss carryforward of approximately $140,391 and $114,391, which will begin to expire in the tax year 2028.

Federal tax laws impose significant restrictions on the utilization of net operating loss carryforwards and research and development credits in the event of a change in ownership of the Company, as defined by the Internal Revenue Code Section 382. The Company’s net operating loss carryforwards and research and development credits may be subject to the above limitations.
 
The relevant FASB standard resulted in no adjustments to the Company’s liability for unrecognized tax benefits. As of the date of adoption and as of March 31, 2014, there were no unrecognizable tax benefits. Accordingly, a tabular reconciliation from beginning to ending periods is not provided. The Company will classify any future interest and penalties as a component of income tax expense if incurred. To date, there have been no interest or penalties charged or accrued in relation to unrecognized tax benefits.  The Company is subject to federal and state examinations for the year 2010 forward. There are no tax examinations currently in progress.
 
 
 
 
36

 
 

THE REAL HIP-HOP NETWORK, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2014


 
NOTE 6 - LICENSE AGREEMENT

On August 15, 2011, Accelerated Acquisitions XII (now known as The Real Hip-Hop Network) entered into a Licensing Agreement (“Licensing Agreement”) that was amended on August 14, 2013  with The Real Hip-Hop Network, Broadcast Corp (“Licensor”) (The Licensor is controlled by a SSM Media Ventures Inc., a major shareholder in the Company- Voting and/or investment power for SSM Media Ventures Inc. is held by Atonn Muhammad , the CEO of the Company), pursuant to which the Company was granted an exclusive, non-transferrable worldwide license for certain first run movies, live concerts, break-dance battles, rhyme competitions, documentaries, news, DJ competitions and interviews (“media content”), distribution platforms, patents, intellectual property, know-how, trade secret information to provide intelligent, family-appropriate Hip-Hop content to a multi-racial/multi-generational demographic.    Except for the rights granted under the License Agreement, Licensor retains all rights, title and interest to the content and any additions thereto—although the License includes the Company’s right to utilize such additions. The term of the License commences on the date of the Licensing Agreement and continues for thirty (30) years, provided that the Licensee is not in breach or default of any of the terms or conditions contained in this Agreement.  In addition to other requirements, the continuation of the License is conditioned on the Company generating net revenues in the normal course of operations or the funding by the Company of specified amounts for qualifying distribution and commercialization expenses related to the media content. In addition, the Company is required to fund certain specified expenses related to the distribution of the media content as specified in the License Agreement. The license is terminated upon the occurrence of events of default specified in the License Agreement and outlined as followed: If any of the Parties are in breach or default of the terms or conditions contained in this Agreement and do not rectify or remedy that breach or default within 90 days from the date of receipt of notice by the other party requiring that default or breach to be remedied, then the other party may give to the party in default a notice in writing terminating this Agreement.  Through the License Agreement the Company was assigned binding and enforceable three years contracts with DirecTV and DISH Network that began in May of 2013. Pursuant to the agreements there are customary subscriber fees, deposits and customary representations and warranties of each of the parties and can be terminate by either party with thirty days written notice. The agreements are intended to allow the Company to launch commercially to a viewership of an estimated 32 million subscribers operating independently of SSM Media the majority stockholder and The Real Hip-Hop Network, Broadcast Corp, the Licensor.

NOTE 7 - RELATED PARTY TRANSACTIONS

The Company acquired the media content and distribution platform rights from the Real Hip-Hop Network Broadcast Corporation, a company based in Washington D.C. that will continue its business of media content development and be a third party media content supplier to the Company, Atonn Muhammad is the founder and President of from the Real Hip-Hop Network Broadcast Corporation and has been President, Chief Executive Officer (CEO) and director of the Company since July 16, 2011. Mr. Muhammad is also the President and CEO and shareholder of SSM Media Ventures, Inc. that owns 22,350,000 shares of the Company’s outstanding common stock, representing an 88.2% ownership interest in the Company. SSM Media Ventures purchased its shares in the Company on July 16, 2011 as disclosed in a Form 8-K filed on July 19, 2011. There were no other agreements between the Company and SSM Media Ventures prior to the Share Purchase Agreement entered into on July 16, 2011.

The Managing Partner of AVP is Timothy Neher, a former director of the Company and the only officer of the Company prior to March 7, 2011. From inception through March 31, 2014, the Company paid $1,800 cash to AVP and accrued $135,626 for expenses due to AVP. See Note 2 for a description of the stock transactions involving AVP. See Note 7 for a description of commitments to AVP.

NOTE 8 - COMMITMENTS AND CONTINGENCIES

Under the terms of the Licensing Agreement, the Company has agreed to pay the Licensor one percent (1%) of any royalties received if the Company grants any third parties royalty-bearing licenses to the content or distribution platforms. In addition, the Company has agreed to pay Licensor a royalty of one quarter of one percent (0.25%) of all gross revenue resulting from use of the content or distribution platforms by the Company. In order to retain its rights, the Company must receive revenues or fund a minimum of $2 million in qualified content distribution and commercialization expenses before the third anniversary of the Licensing Agreement (at least $0.5 million of which must be before the first anniversary of the Licensing Agreement and at least $1 million of which must be before the second anniversary of the Licensing Agreement).

On July 18, 2011, the Company entered into a Consulting Services Agreement with AVP.  The agreement requires AVP to provide the Company with certain advisory services that include reviewing the Company’s business plan, identifying and introducing prospective financial and business partners, and providing general business advice regarding the Company’s operations and business strategy. Cash compensation of $800,000 is due consultant upon the achievement of Milestone 1, $800,000 upon the achievement of Milestone 2 and $800,000 upon the achievement of Milestone 3. Upon achieving each Milestone, the cash compensation is to be paid to consultant in the amount then due at the rate of $66,667 per month. The total cash compensation to be received by the consultant is not to exceed $2,400,000 unless the Company receives an amount of funding in excess of the amount specified in Milestone 3. If the Company receives equity or debt financing that is an amount less than Milestone 1, in between any of the above Milestones or greater than the above Milestones, the cash compensation earned by the Consultant under this Agreement will be prorated according to the above Milestones. The Company also has the option to make a lump sum payment to AVP in lieu of all amounts payable thereunder. As of March 31, 2014, the Company has not achieved any of the Milestones.
 
 
 
 
37

 
 

THE REAL HIP-HOP NETWORK, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2014


As permitted under Delaware law and in accordance with its Bylaws, the Company indemnifies its officers and directors for certain expenses incurred from legal or other proceedings that arise as a result of the director or officer’s service to the Company. There is no limitation on the term of the indemnification and the maximum amount of potential future indemnification is unlimited. The Company currently does not have a directors and officers insurance policy that could limit its exposure and enable it to recover a portion of any future amounts paid. The Company believes the fair value of these officer and director indemnification agreements is minimal, and, accordingly, has not recorded any liabilities for these agreements as of March 31, 2012.

From time to time, the Company may be involved in claims and other legal matters arising in the ordinary course of business. Management is not currently aware of any matters that it believes are likely to have a material adverse effect on its financial position or results of operations.
 
 
 
 
38

 
 


ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
 
There are not and have not been any disagreements between the Company and its accountants on any matter of accounting principles, practices or financial statement disclosure. On December 17, 2012 the Board of Directors dismissed Peter Messineo, CPA, as our registered public accountants.  The Board elected Anton & Chia, LLP, Newport Beach CA. as our auditor. Prior to Board approval, we had not consulted with Anton & Chia, LLP on any accounting or audit matters.
 
Item 9A(T). Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

The Company’s management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms.  Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

In accordance with Exchange Act Rules 13a-15 and 15d-15, an evaluation was completed under the supervision and with the participation of the Company’s management, including the Company’s President, Principal Financial Officer and Secretary, 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 Annual Report.  Based on that evaluation, the Company’s management including the President, Principal Financial Officer and Secretary, concluded that the Company’s disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K, were effective in providing reasonable assurance that information required to be disclosed in the Company’s reports filed or submitted under the Exchange Act was recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms.

Evaluation of Internal Controls and Procedures

This annual report does not include a report of management's assessment regarding internal control over financial reporting or an attestation report of the Company's registered public accounting firm due to a transition period established by rules of the Securities and Exchange Commission for newly public companies.

Changes in Internal Controls over Financial Reporting

There have been no significant changes to the Company’s internal controls over financial reporting that occurred during our last fiscal quarter of the year ended March 31, 2013, that materially affected, or were reasonably likely to materially affect, our internal controls over financial reporting.
 
ITEM 9B.  OTHER INFORMATION
 
In our fiscal fourth quarter which ended March 31, 2014, we had no events that were required to be reported on Form 8-K that were not filed to date.

 
 
 
39

 
 
 
PART III
 
ITEM 10.  DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The following individuals currently serve as our executive officers and directors:

Name
Age
Position
 
       
Atonn F. Muhammad
39
Chief Executive Officer, Chairman
 
Alvin Butler, Jr.
32
Chief Financial Officer, Treasurer
 
Matthew Anderson
29
Chief of Staff, Secretary, Director
 
Aquil Muhammad
61
Chief Security Officer, Vice-Chairman
 
 
Atonn F. Muhammad - Chief Executive Officer, Chairman
Mr. Muhammad is Chief Executive Officer and Chairman of the Company since July 16, 2011 and is a seasoned, successful entrepreneur with strong, deep ties to the television programming and music industries and communities. He continues to hold the position as CEO at Real Hip-Hop Network Broadcast Corporation that he has held since 2003. Mr. Muhammad is also the co-founder and CEO of SSM Media Ventures, Inc, from 2008 to 2011. Prior to the inception of SSM Media Ventures, Inc and Real Hip-Hop Network Broadcast Corporation, Mr. Muhammad was a Financial Advisor with Morgan Stanley from 2000 to 2001. Mr. Muhammad was also the co-founder and CEO of SSM Media and Entertainment Group, Inc, from 2000 to 2003. SSM Media was telecommunications media firm created to provide television programming services to diverse, global markets through satellite and cable distribution. Prior to SSM Media and Entertainment Group, Inc, he was the CEO of RAAMM Enterprises, Inc., a successful concert promotions company that he was with from 1993 to 1998.

Mr. Muhammad has been featured on CNN/CNN Headline News/ BET/ The Hollywood Reporter and Billboard magazine. Mr. Muhammad has been making waves in the industry through his efforts to debunk the commonly held image of Hip-Hop being associated with misogyny, excessive violence, and Pimp culture. He has been on speaking tours with Bill Cosby and has gone all across this country spreading his message. He was educated at the University of Miami and was a running back for the school’s nationally acclaimed football team.

Alvin Butler, Jr. – Chief Financial Officer, Treasurer
Mr. Butler Chief Financial Officer and Treasurer of the Company since July 16, 2011 and has a strong background in financial management. Prior joining the Company Mr. Butler was CFO at SSM Media ventures from 2007 to 2011.to his role was to maintain the financial stability of SSM and all of its properties worldwide. As SSM Media Ventures, Inc. expanded its reach Mr. Butler ensured that funds were allocated and managed appropriately for the success of the companies. Mr. Butler also regularly communicated with shareholders and secured key partnerships with other financial experts and industry specialist to ensure success. Mr. Butler also was the Chief Financial Officer of American Home Investment Group, Inc. from 2000 to 2005 where he led and arranged the funding for several key acquisitions. Mr. Butler has played a key role in many development projects including real estate, media, and global commerce. Mr. Butler has a passion for financial systems and management and business development.

Matthew Anderson - Chief of Staff, Secretary, Director
Mr. Anderson is Chief of Staff and Secretary of the Company since July16, 2011, and is an experienced entrepreneur and business leader. Prior to joining the Company he was Chief of Staff at Real Hip-Hop Network Broadcast Corporation from 2007 to 2011 where he facilitated key partnerships and business opportunities. He was also the former President/CEO of American Home Investment Group, Inc. from 2005 to 2008 which specialized in acquiring and developing commercial and residential real estate projects where the deal sizes ranged from a few million up to eighty million dollars. Prior to American Home Investment Group, Inc Mr. Anderson was an Operations Manager with United Parcel Service from 2000 to 2004.

Aquil Muhammad – Chief Security Officer, Vice Chairman
Mr. Muhammad is Chief Security Officer and Vice Chairman of the Company since July 16, 2011, and has been Chief Security Officer of Real Hip-Hop Network Broadcast Corporation since 2003. Prior to Real Hip-Hop Network Broadcast Corporation Mr. Muhammad founded Star-Brite Security and was CEO from 1997 to 2003, one of Washington D.C.’s largest security companies. Mr. Muhammad was also Founder and CEO of NOI Security from 1991 to 1996. He has advised many large companies and organizations on security, internal controls and compliance. Mr. Muhammad’s role with the Company as Vice Chairman/Chief Security Officer is to advise the CEO on security, compliance, policy and procedures.
 
 
 
40

 
 
 
Timothy J. Neher
Founder, President, Secretary, Treasurer and sole director of the Company from its founding in May 2010 through July 16, 2011 when Mr. Neher resigned his positions. Mr. Neher is the founding partner of Accelerated Venture Partners, LLC, a private venture capital firm based in Foster City, California, and has over 15 years of experience in connection with the provision of debt and equity financing, mergers and public offering transactions. Timothy is the acting Chief Financial Officer, Treasurer and a Director of Mikojo, Inc. a public reporting company since 2009. Mr. Neher is also Director of Pinpointed Solutions Inc. a private company since 2008, Director of Ipaypod Inc., a private company since 2007 and Director of Internet Card Present, Inc., a private company since 2007. He is also the President, Secretary and sole director of following public reporting companies: Accelerated Acquisitions XIII, Inc., Accelerated Acquisitions XIV, Inc. and director of Virolab a public reporting company since May of 2010. Prior to founding Accelerated Venture Partners, Internet Card Present Industries, Pinpointed Solutions and Ipaypod, Timothy was Chairman and Chief Executive Officer of Wherify Wireless, a private to public company from 1999 to 2007. Other past experience includes roles as VP of Marketing & Sales for CTH Consumer Plastics and VP of Operations for Windy City Product Development.

On May 4, 2010, the Registrant sold 5,000,000 shares of Common Stock to Accelerated Venture Partners, LLC controlled by Timothy Neher for an aggregate investment of $2,000.00. The Registrant sold these shares of Common Stock under the exemption from registration provided by Section 4(2) of the Securities Act.

On July 18, 2011 the Company entered into a Consulting Services Agreement with Accelerated Venture Partners, LLC described in the “CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE” section below. Mr. Neher had no prior relationship SSM Media Ventures or Real Hip-Hop Network Broadcast Corporationor any involvement in facilitating the License Agreement between the Company and The Real Hip-Hop Network, LLC.

There are no family relationships between our officers and directors. Each director is elected at our annual meeting of stockholders and holds office until the next annual meeting of stockholders, or until his successor is elected and qualified.
 
Board Committees
 
Due to the small size of our current Board of Directors, the Board has not established any committees and the full Board fulfills the responsibilities traditionally delegated to an audit committee, compensation committee, nominating committee and/or corporate governance committee. As the Board size grows and the Company increases its level of operations, the Board will consider delegating various responsibilities to committees.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
 
Section 16(a) of the Securities Exchange Act of 1934 requires our executive officers and directors, and persons who own more than 10% of a registered class of our equity securities to file reports of beneficial ownership and changes in beneficial ownership with the SEC. Executive officers, directors and greater than 10% stockholders are required by SEC regulations to furnish us with copies of all reports filed under Section 16(a). To the Company’s knowledge, based on information provided to the Company, all executive officers, directors and greater than 10% stockholders were in compliance with all applicable Section 16(a) filing requirements in fiscal 2011.

 ITEM 11.  EXECUTIVE COMPENSATION

The following table summarizes all compensation recorded by us in 2013 for our principal executive officers, each other executive officer serving as such whose annual compensation exceeded $100,000, and up to two additional individuals for whom disclosure would have been made in this table but for the fact that the individual was not serving as an executive officer of our Company at March 31, 2014:

None
 
Outstanding Equity Awards at Fiscal Year-End

The following table provides information concerning unexercised options, stock that has not vested and equity incentive plan awards for each named executive officer outstanding from inception May 4, 2010 through March 31, 2014:

None.
 
 
 
 
41

 
 

Compensation of Directors

We have not established standard compensation arrangements for our directors and the compensation, if any, payable to each individual for their service on our Board will be determined from time to time by our Board of Directors based upon the amount of time expended by each of the directors on our behalf.  None of our directors received any compensation for their services.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth certain information regarding beneficial ownership of the Company's Common Stock as of March 31, 2013, by: (i) each current director; each nominee for director, and executive officer of the Company; (ii) all directors and executive officers as a group; and (iii) each shareholder who owns more than five percent of the outstanding shares of the Company's Common Stock. Except as otherwise indicated, the Company believes each of the persons listed below possesses sole voting and investment power with respect to the shares indicated.  

Name and Address
 
Number of Shares
   
Percentage Owned
 
                 
SSM Media Ventures
   
22,350,000
     
88.8%
 
1020 19th Street, Suite 525
Washington, D.C. 20036 (3)
               
                 
Accelerated Venture Partners, LLC
               
1840 Gateway Drive, Suite 200
               
Foster City CA, 94404 (4)
   
6,800,000
     
23.32%
 
                 
Timothy Neher (5)
   
6,800,000
     
23.32%
 
Matthew Anderson, Chief of Staff, Secretary, Director
   
-
     
-
 
Aquil Muhammad, Vice Chairman
   
-
     
-
 
                 
Directors and Executive Officers as a group
   
29,150,000
     
100%
 
                 
___________

(1) This table is based upon 29,150,000 shares issued and outstanding as March 31, 2014.

(2) Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and includes voting and investment power with respect to the shares. Shares of Common Stock subject to options or warrants currently exercisable or exercisable within 60 days are deemed outstanding for computing the percentage of the person holding such options or warrants, but are not deemed outstanding for computing the percentage of any other person.

(3) Atonn F. Muhammad is founder and Managing Partner of SSM Media Ventures, LLC and holds voting and dispositive power for these shares.

(4) Shares are owned directly by Accelerated Venture Partners, LLC. Timothy Neher, is Managing Partner of Accelerated Venture Partners and holds voting and dispositive power for these shares.

(5) Timothy Neher is founder and Managing Partner of Accelerated Venture Partners, LLC and holds voting and dispositive power for these shares.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
 
Director Independence
 
As of March 31, 2014, the Board consisted of Atonn F. Muhammad, Matthew Anderson and Aquil Muhammad. The Board has determined that none of the members are independent director as defined by the rules of The Nasdaq Stock Market.

 
 
 
42

 
 
 
Related Party Transaction Review and Approval
 
We have entered into indemnification agreement with our director for the indemnification of them to the fullest extent permitted by law. The indemnification agreements also allow advancement of expenses to the directors.
 
Our Board of Directors has not adopted formal policies and procedures for the review and approval of related party transactions. Our Board of Directors has reviewed and approved the material terms of our related party transactions.

ITEM 14.  PRINCIPAL ACCOUNTING FEES AND SERVICES
 
Audit Fees

The aggregate fees billed by Peter Messineo, CPA our prior auditor, for professional services rendered for the audit of our annual financial statement and limited review of financial statements included in our quarterly reports on Form 10-Q or services that are normally provided in connection with statutory and regulatory filings were $2,000 for the period from July 6, 2011 to March 31, 2014.  Anton & Chia LLP was elected as our auditor in December 2012 for our Form 10-K, estimated costs will be $1,250 for our year end,

Audit-Related Fees

There were no fees billed or to be billed by Messineo for assurance and related services that are reasonably related to the performance of the audit or review of the Company’s financial statements for the period from July 6, 2011 to March 31.2014 

Tax Fees

There were no fees billed or to be billed by Messineo for professional services for tax compliance, tax advice, and tax planning or the period from July 6, 2011 to March 31, 2014

All Other Fees

There were no fees billed or to be billed by Messineo for other products and services for the period from July 6, 2011 to March 31, 2014

Audit Committee’s Pre-Approval Process

            The Board of Directors acts as the audit committee of the Company, and accordingly, all services are approved by all the members of the Board of Directors.
   
PART IV
 
 ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES
 
(a)
Financial Statements and Schedules:
 
Financial statements as of March 31, 2014, and for the period then ended, are included in Item 8. All schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.
 

 
 
 
43

 
 
 
(b)
Exhibits:
 
The following exhibits are incorporated by reference or filed as part of this report.
 
     
Incorporated by Reference
 
 
 
Filed Herewith
 
Exhibit
  No.
 
Description
Form
Exhibit Number in form
Date of Filing
 
 
3.1    
  
Certificate of Incorporation
 
10
 
3.1
 
7/26/2010
   
 
3.2    
  
Bylaws of the Company
 
10
 
3.2
 
7/26/2010
   
 
10.1   
  
 
Subscription Agreement for sale of common stock to SSM Media Ventures, dated as of July 16, 2011
 
8-K
 
10.1
 
7/19/2011
   
               
10.2
 
Letter dated July 16, 2010 from Accelerated Venture Partners to Accelerated Acquisitions XII, Inc. regarding the tender of shares for cancellation.
8-K
10.2
7/19/2011
   
10.3
 
Letter of resignation tendered by Timothy Neher on July 16, 2011.
8-K
10.3
7/19/2011
   
10.4
  
 
Consulting Agreement by and among the Company and Accelerated Venture Partners, LLC, dated as of July 18, 2011
 
8-K
 
10.4
 
7/19/2011
   
               
10.5
 
License Agreement by and among the Company and the Real Hip-Hop Network Broadcast Corporation dated August 15, 2011
8-K
10.1
8/15/2011
   
 
10.6   
  
2011 Employee, Director and Consultant Stock Plan *
 
10-K
 
10.6
 
7/14/2011
   
24.1   
  
Powers of Attorney. (Contained on Signature Page)
     
x
 
31.1   
  
Certification of Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
     
 
x
 
31.2   
 
Certification of Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
     
 
x
 
32.1   
  
Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
     
 
x
 
 101
 
XBRL Documents
     
x
 
 
*
This exhibit is a management contract or compensatory plan or arrangement.
 

 
 
 
44

 
 
 

SIGNATURE
 
Pursuant to the requirements of Section 13 or 15(d) 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.
 
       
   
The Real Hip-Hop Network, Inc.
     
   
By:
    / S /    Atonn F. Muhammad
Dated:  June 30, 2014
   
    Atonn F. Muhammad
    Chief Executive Officer
 

POWER OF ATTORNEY AND SIGNATURES
 
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints each of Atonn F. Muhammad as his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments to this report, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent or his substitute may lawfully do or cause to be done by virtue hereof.
 
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
 
         
Signature
  
Title
 
Date
     
/ S /    Atonn F. Muhammad
  
Chief Executive Officer
(Principal Executive Officer)
 
June 30, 2014
Atonn F. Muhammad    
     
/ S /    Atonn F. Muhammad
  
Chief Financial Officer
(Principal Financial and Accounting Officer)
 
June 30, 2014
Atonn F. Muhammad    
     
         
     
         

 
 
 
 
45