Washington, D.C. 20549

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FORM 10-K

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[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

ACT OF 1934

For the fiscal year ended September 30, 2014

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

ACT OF 1934

For the transition period from ____________ to____________

Commission File Number: 333-171488

CITY MEDIA, INC.

(Exact Name of Registrant as specified in its charter)

4685 S. Highland Drive, Suite 202, Salt Lake City, UT  84117

(Address of Principal Executive Office)

(801) 278-9424

(Registrant’s Telephone Number, including Area Code)

Securities Registered Pursuant to Section 12(b) of the Act: None

Securities Registered Pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [  ] No [X]

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. Yes [  ]   No [X]

Indicate by check mark if the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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.  

(1) Yes [X] No [  ]     (2) Yes [X] No [  ]

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

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or 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]

State the aggregate market value of the voting and non-voting common stock held by non-affiliates computed by reference to the price at which the common stock was last sold, or the average bid and asked price of such common stock, as of the last business day of the Registrant’s most recently completed second quarter: Not applicable.

Applicable only to Registrants involved in Bankruptcy Proceedings during the preceding Five Years

Not applicable.

Outstanding Shares

As of November 7, 2014, the Registrant had 8,968,000 shares of common stock outstanding.

Documents Incorporated by Reference

See Part IV, Item 15.

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TABLE OF CONTENTS

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FORWARD LOOKING STATEMENTS

In this Annual Report, references to “City Media,” “City,” “Charta” (as defined below), the “Company,” “we,” “us,” “our” and words of similar import) refer to City Media, Inc., the Registrant.

This Annual Report contains certain forward-looking statements and for this purpose any statements contained in this Annual Report that are not statements of historical fact may be deemed to be forward-looking statements.  Without limiting the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate” or “continue” or comparable terminology are intended to identify forward-looking statements.  These statements by their nature involve substantial risks and uncertainties, and actual results may differ materially depending on a variety of factors, many of which are not within our control.  These factors include but are not limited to economic conditions generally and in the endeavors in which we may participate, competition within our chosen industry, technological advances and failure by us to successfully develop business relationships, among others.

PART I

ITEM 1.  BUSINESS

Business Development

City Media, Inc. (the “Company”) was incorporated in the state of Utah in April, 2005.  On or about September 24, 2010, the Company acquired Charta Systems, Inc. (“Charta”) for five million two hundred fifty thousand (5,250,000) shares of the Company’s common stock.  Following the acquisition of the shares, Charta became a wholly owned subsidiary of the Company operating under the name Charta Systems, Inc.  The historical financial information presented is that of Charta, the accounting acquirer.  

The Company’s operations at inception were in the outdoor mobile advertising market primary focusing on mobile advertising on the sides and backs of commercial trucks. The company attempted to procure additional clientele through offering washing services to such target market and other high customer traffic areas for small and medium sized businesses. The vehicle and mobile wash equipment was subsequently rented to a former officer, Craig Miller, at a rate of $500 per month following the Charta acquisition.  In September of 2010, the Company acquired Charta Systems, Inc. Charta Systems has owned and operated non-financial institution cash dispensing only ATMs (automatic teller machines) since May of 2008. The machines are placed in hotels, stores, bowling alleys, and other high customer traffic areas for small and medium sized businesses. The Company charges transaction fees on each ATM cash dispensing transaction at various rates as determined by location. The Company currently has nine ATMs in operation.  Outdoor mobile advertising and mobile washing services are no longer a part of our business plan.

Description of Business

City Media focuses on placing ATMs that we own and operate in third-party owned high-traffic commercial areas. We maintain all basic level maintenance and serviceability requirements.  We primarily operate along the Wasatch Front in Salt Lake City, Utah.  

Principal Products or Services and Their Markets

Markets

City Media services and operates retail location ATMs along the Wasatch Front in Salt Lake City, Utah.  We believe the deployment of quality ATMs presented in an appealing manner, along with dependability for the repeat customer, are simple but effective tools.  Ultimately, ATMs provide a simple utilitarian function of dispensing cash to customers.  Prominently displayed signage and machines, convenient hours and easy access in areas not congested with independent competitors or financial intuitions are ideal.

When securing a retail location for an ATM, the proprietor is typically concerned with space utilization and how to increase sales and reduce credit-card fees.

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Products

We are an independent owner operator of non-financial institution cash-dispensing only ATMs at third-party owned retail and commercial locations for the benefit of the proprietor and customers seeking access to their cash through credit and debit cards.  We generate revenue through transaction or surcharge fees along with collecting interchange fees from processors.  Transaction or surcharge fees are determined by us in cooperation with the proprietor of the location and may or may not be split.  Interchange fees paid by the issuing card company may be paid to the processor and split with us, though this is not a guaranteed revenue stream like the surcharge fee.

Objectives

We service and operate nine retail location ATMs in Salt Lake City and Heber City, Utah.  We will be looking to find new locations for machines to make sure our machines are deployed in locations with the best traffic flow which would encourage or require potential customers to access cash.  Our product focus is on the ability of potential customers that need cash for an immediate purchase.  As we look to locate ATMs, we will focus on those locations that have the need for quick cash.  Generally, these are locations where credit and debit cards are not readily taken or where cash only lines offer convenience for the consumer.

Distribution Methods of the Products or Services

Our services are distributed through our nine cash machines at various locations primarily at small business locations around the Salt Lake City and Heber Utah areas.

Competitive Business Conditions and Smaller Reporting Company’s Competitive Position in the Industry and Methods of Competition

The ATM industry is highly competitive and fragmented whereby 50% to 66% of ATMs are owned by independent operators.  Although banks and financial institutions have a large portion of the market, since we focus on smaller areas, we do not compete as directly with financial institutions as we do with other independent operators.  Most financial institutions maintain their machines only at very high traffic areas or on the site of their existing branches. Within the Salt Lake area we are a very small operator and do not have the name recognition of approximately these established competitors.

Sources and Availability of Raw Materials and Names of Principal Suppliers

We conduct standard operations with financial institutions and processing companies that have no unique characteristics that could not easily be obtained.

Dependence on One or a Few Major Customers

We have deployed our ATMs to nine different ATM locations that are privately owned and independent of one another so we are not dependent on any one location.

Patents, Trademarks, Licenses, Franchises, Concessions, Royalty Agreements or Labor Contracts, including Duration

We do not have or foresee any patents, trademarks, licenses, franchises or labor contracts.

Though we do not have royalty agreements the Company does have contracts to share transaction fees with some of its locations in exchange for having ATMs on their premises and others are simple non-binding month to month agreements that can be cancelled whereby our machines are removed at the discretion of the location.  Such agreements may be considered a royalty payment.

Additionally, the Company has a processing agreement with National Link Inc. of San Dimas, CA to process the transactions on all the machines along with processing support from RBS Worldpay. National Link is paid an

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interchange fee from national and international banks and financial institutions that pay them for processing the transactions of their individual customers through the Company’s machines. This agreement can be terminated at any time by National Link with or without cause at their discretion; however there are numerous other processing companies the Company could easily engage to process its transactions.

Need for any Governmental Approval of Principal Products or Services

Non-bank owned ATMs are primarily regulated at the State level and Federal EFT (Electronic Fund Transfer) Law and more specifically Federal Regulation E, which was promulgated pursuant to the Federal EFT.  The regulatory requirements dictate basic disclosures such as clear markings including contact information, fee amounts, proper lighting, etc.  Registration of the ATMs is complied with by assistance from the processing company.  Management believes that we are in full compliance with all state and federal regulations in this regard and have never had any violations.

We are also subject to changes in banking laws and rules and regulations of governmental agencies that oversee the financial industry.  These changes could have a material adverse effect on our business.  We are also subject to regulations already in effect, or those that may be enacted in the future, which create additional requirements on our ability to deploy ATM machines or limit the fee amounts that ATM operators can charge customers.  

Effect of Existing or Probable Governmental Regulations on the Business

The Company does not anticipate that government regulations will have a material effect on the business at this time.

Research and Development Costs During the Last Two Fiscal Years

We are not currently engaged in any research and development.

Cost and Effects of Compliance with Environmental Laws

We have no known costs, and none are anticipated, from environmental laws, rules and regulations.

Number of Total Employees and Number of Full Time Employees

As of September 30, 2014, we employed no employees, except our executive officers that receive no salaries.  Also, the Chief Operations Officer of our wholly-owned subsidiary, Calvin Jones, is the principal of Wasatch ATM, LLC that we currently have an ATM servicing contract with and pay $900 per month.

Additional Information

You may read and copy any materials that we file with the Securities Exchange Commission at its Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549.  You may also find all of the reports or registration statements that we have previously filed electronically with the Securities Exchange Commission at its Internet site at www.sec.gov.  Please call the Securities Exchange Commission at 1-202-551-8090 for further information on this or other Public Reference Rooms.  Our filed reports and registration statements are also available from commercial document retrieval services, such as CCH Washington Service Bureau, whose telephone number is 1-800-955-5219.

ITEM 1A.  RISK FACTORS

We are a start-up company with limited operating history, limited revenue and have to rely on our ability to raise capital to fund operations and there can be no assurance we will ever reach profitability or be able to continue to raise capital to fund operations.

Our current operations have not proven profitable and we currently need additional funds to cover ongoing expenses. Accordingly, City Media’s business strategy may not be successful. Failure to implement the business strategy could materially adversely affect our business, financial condition and results of operations. Through

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September 30, 2014, City Media’s business has not shown a profit in operations and has generated limited revenue. Additionally, we have very limited resources and we continue to lose money.  There can be no assurance we will achieve or attain profitability or be able to raise sufficient capital to stay in business. If we cannot achieve operating profitability or raise capital, we may not be able to meet our working capital requirements, which could have a material adverse effect on our business operating results and financial condition resulting in the loss of an investors’ entire investment in us.  At this time without additional capital, we will not be able to remain in operation.

Our auditors have indicated in their audit opinion that there is a substantial doubt about our ability to continue as a going concern which will affect our ability to raise capital or borrow money.

Our auditors have issued an audit opinion indicating that there is a substantial doubt about our ability to remain as a going concern.  As such, any potential investor or lender is unlikely to be willing to provide additional capital or loans to us.   Without additional capital, we will not be able to remain in business or execute on our business plan.  Even if we are able to obtain additional capital, given the “going concern” modification, it is likely investors would suffer substantial dilution to their investment.

We need substantial additional capital to grow and fund our planned business and business strategy and the failure to raise such capital will have a material adverse effect on our business and growth opportunities.

Without significant funding, we may not be able to execute on our business plan and if operational or unexpected expenses arise we may be forced to cease operations.  At this time, there can be no assurance we will be able to obtain the funding we need to expand and even if we obtain such funding that it will be on terms and conditions favorable to us and our existing stockholders.  Without funding we will not be able to proceed with planned expansion and our long term success will be doubtful.

We could lose all or some of our locations where we maintain machines which would have a material adverse effect on our business.

The duration and enforceability of contracts with individual locations varies and is subject to a high rate of turnover in their respective management and/or ownership that could affect us adversely. Most location contracts are expensive and difficult to enforce even when they are in place.  Currently, we have nine locations and are searching for additional locations to deploy ATM machines.  The completion for the best locations or those locations with heavy foot traffic is very competitive and the loss of any of our current locations would be difficult to replace.  Given we are not profitable having any ATMs not deployed hurts our ability to stay in business and further reduces our limited capital creating serious questions ability our ability to remain in operations.

We have signed an agreement to sell 3,003,600 shares of our common stock which will dilute the ownership of current investors, and as part of this agreement, new management will be appointed without the approval of current shareholders.

We have entered into an agreement to sell 3,003,600 shares of our common stock to Weed Growth Fund, Inc. for total proceeds of approximately $100,000.  The proceeds of this sale will be used to pay off existing obligations, including our notes payable.  Our existing obligations will require the entire amount of the proceeds and no additional funds will be available for ongoing operations.  Accordingly, we will have to raise additional capital which will most likely further dilute current shareholders.  Furthermore, as part of the agreement, new management will be appointed, including new officers and directors.  Current shareholders will not have a say in their appointment.  For these reasons, current shareholders will not only suffer dilution on the sale, but likely further dilution from future fund raising and will have no say in the management of the Corporation or the direction the new management pursues. There can be no assurance the agreement with Weed Growth Fund, Inc. will close and that we will receive the proposed proceeds from such stock sale.

ITEM 2:  PROPERTIES

We presently utilize the office space of our President, Thomas Howells, and Travis Jenson, a director, at no cost, located at 4685 S. Highland Drive #202, Salt Lake City, Utah 84117.  The cost for the use of the office space and telephone is minimal.  Pursuant to our agreement with Wasatch ATM, LLC, we utilize, at no costs, space provided

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by Calvin Jones, a stockholder and an officer of Charta for non-deployed ATMs.  The cost for the use of this space is minimal.

ITEM 3:  LEGAL PROCEEDINGS

We are not a party to any pending legal proceeding. To the knowledge of our management, no federal, state or local governmental agency is presently contemplating any proceeding against us. No director, executive officer or affiliate of ours or owner of record or beneficially of more than 5% of our common stock is a party adverse to us or has a material interest adverse to us in any proceeding.

ITEM 4:  MINE SAFETY DISCLOSURE

None; not applicable.

PART II

ITEM 5:  MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

Our common stock was listed on the OTC Bulletin Board on August 21, 2012, under the symbol “CTYM”.  We have had nominal trading and there is no established trading market in our stock.  No assurance can be given that any viable market for our common stock will develop or be maintained or that shareholders will receive any liquidity capabilities.

For any market that develops for our common stock, the sale of “restricted securities” (common stock) pursuant to Rule 144 of the SEC by members of management or any other person to whom any such securities may be issued in the future may have a substantial adverse impact on any such public market.  For information regarding the requirements of resales under Rule 144, see the heading “Rule 144” below.

The following table sets forth, for the periods indicated over the last two years, the high and low closing bid quotations, as reported by the OTC Bulletin Board, and represents prices between dealers, does not include retail markups, markdowns or commissions, and may not represent actual transactions:

Holders

As of November 7, 2014, we had approximately 65 shareholders of record.

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Dividends

We have not declared any cash dividends with respect to our common stock and do not intend to declare dividends in the foreseeable future. There are no material restrictions limiting, or that are likely to limit, our ability to pay dividends on our securities.

Securities Authorized for Issuance Under Equity Compensation Plans

We have no equity compensation or similar plans.

Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities

Recent Sales

We did not issue any unregistered securities during the fiscal years ended September 30, 2014, and 2013.

Use of Proceeds of Registered Securities

There were no proceeds received during the calendar year ended September 30, 2014, from the sale of registered securities.

Purchases of Equity Securities by Us and Affiliated Purchasers

We have not made any purchases of our outstanding equity securities; nor have any purchases of our equity securities been made by any person who may be deemed to have been one of our “affiliates.”

ITEM 6:  SELECTED FINANCIAL DATA

For the year ended September 30, 2014, the Company had current assets of $2,391 and working capital deficit of $3,593.  At September 30, 2013, the Company had current assets of $2,320 and working capital deficit of $922.

The following table shows selected summarized financial data for the Company.  The data should be read in conjunction with the financial statements and notes included in this annual report.

STATEMENT OF OPERATIONS DATA:

City Media, Inc.:

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ITEM 7:  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

When used in this Annual Report, the words “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “project,” “intend,” and similar expressions are intended to identify forward-looking statements within the meaning of Section 27a of the Securities Act and Section 21e of the Exchange Act regarding events, conditions, and financial trends that may affect Guide’s future plans of operations, business strategy, operating results, and financial position.  Persons reviewing this Annual Report are cautioned that any forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties and actual results may differ materially from those included within the forward-looking statements as a result of various factors.  Such factors are discussed further below under “Trends and Uncertainties,” and also include general economic factors and conditions that may directly or indirectly impact our financial condition or results of operations.

Plan of Operation

Our primary focus for 2013-2014 was the placement and servicing of ATM machines for public use along the Wasatch Front in the State of Utah.  During the fiscal year ended September 30, 2014, we had a total of nine machines in operation.   Given our current lack of liquidity and difficulty in obtaining debt from traditional banking sources, we will focus future fund raising on the sale of our equity securities.  There can be no assurance that we will be successful at raising additional capital and without additional capital, we will not be able to expand operations and reach long term profitability. To this end we have entered into a contract with Weed Growth Fund, Inc. to sell 3,003,600 shares of our common stock for proceeds of approximately $100,000 to pay off existing obligations, including accounts payable and outstanding notes.  As part of the proposed equity investment, Weed Growth Fund, Inc. will be looking at replacing existing managers with new management that have access to additional capital, potential new locations for our ATMs and potential additional business opportunities which would help provide value to the Company and its shareholders.  Under the terms of the proposed transaction, the Company would sell 3,003,600 shares of its common stock to the investor for $100,000.  The funds received would be targeted at paying off existing obligations, including the outstanding notes which are primarily owed to current management and major shareholders.  Additionally, it is anticipated, current management will sell a majority of their shares to the investor.  As part of the proposed transaction the new investor, which would control a majority of our outstanding stock, would nominate additional management to help run the Company.  This management would be appointed to our board of directors and also take over the roles of CEO and CFO.  It is anticipated if the transaction closed, the current management would resign in favor of the investors proposed slate of officers and directors.  The proposed new management has indicated they will continue the focus on the ATM business though the geographical locations may expand outside of the state of Utah.  Additionally the new management may seek to expand the operations of the Company into additional areas they believe would be profitable for the Company and benefit its shareholders.  Although we have entered into a stock purchase agreement, there can be no assurance the Company will be able to close this stock sale.  If we are unable to close the potential equity investment, management will have to look to other potential investors or see if they are able to renegotiate the existing outstanding notes to delay payment or possibly increase the amount of the loan under the notes to help fund ongoing operations.  Presently, the Company does not have sufficient funds, without additional equity or debt financing to support operations for the next fiscal year.  There is presently no commitment to provide any further funding to the Company if the proposed funding does not occur.  Even if the Company does close the proposed funding, the funds raised will already be allocated to pay off existing debt and there will be not be additional funds to cover ongoing operations or expand existing operations.  

Liquidity and Capital Resources

We had $2,391 in current assets as of September 30, 2014. During the year ended September 30, 2011, we received $17,001 from certain shareholders to cover expenses during the year.  As of September 30, 2013, the Company had issued $81,000 in convertible promissory notes with various shareholders.  The Company had borrowed a total of $56,901 in principal against these notes.  On January 28, 2014, the Company signed additional convertible promissory notes with certain shareholders that provided for additional liquidity resources in the amount of $15,000, with $15,000 available to be used at the Company’s discretion.  Of these notes, $90,000 in face value convertible promissory notes were consolidated into aggregate convertible promissory notes on February 7, 2014, in the aggregate principal amount of $90,000, with accrued and unpaid interest thereon in the amount of $7,767, as of

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January 31, 2014.  The Company and the holders of such notes agreed to modify the Notes by: (i) issuing new notes dated as of February 7, 2014 in which the accrued and unpaid interest for each note through January 31, 2014 has been included in the principal balance of the new notes; (ii) extending the due date for the notes to December 31, 2015; (iii) providing that the Notes shall be convertible into shares of the Company's common stock at the option of the Company as previously set forth in the notes or at the holder’s option as set forth in the notes.  All Company notes, with a total face value of $96,000, are now payable on December 31, 2015, accrue interest at a rate of 8.5% per annum, and are convertible at the option of the Company for a conversion price of $0.10 per share.

During the years ending September 30, 2014 and 2013, the Company borrowed additional funds of $20,800 and $20,901, respectively, on these notes.  As of September 30, 2014, the principal outstanding on the consolidated convertible promissory notes was $77,701.

Accrued interest on all loans from shareholders at September 30, 2014 was $12,480, with $7,767 of this amount being applied to a reduction of the available principal amount as a result of the aggregation though reflected as accrued related party interest.  Total interest expense from these notes for the years ended September 30, 2014 and 2013 was $6,625 and $4,252, respectively.

The Company has accumulated operating losses of $140,858, as of September 30, 2014.  The Company has entered into a stock purchase agreement for the sale of 3,003,600 shares of our common stock for proceeds of $100,000 to help pay off the prior notes along with all existing payables.  Management believes by removing the debt from the balance sheet, it will be easier to raise additional equity capital.    There can be no assurance that the Company will be able to complete the raise of any equity capital or by paying off existing debt any further funds can be raised. Even if the Company does close on the proposed funding, once existing obligations are paid, there would be no additional funds to cover ongoing operations.  Management would have to look to further funding to cover future expenses of the business.

Results of Operations

Revenue for the fiscal years ended September 30, 2014, and 2013, were $19,034 and $21,640. The decrease in revenue was a result of relocating one machine out of its location for an extended period of time while a new location was located, as well as the result of one “cash-only” location accepting credit cards.

During the year ended September 30, 2014, we had a net loss of $30,697.  During the period ending September 30, 2013, we had a net loss of $23,837. The increase in our net loss was primarily a result of increased legal expenses and increased interest charges along with the decrease in revenue.

Off-Balance Sheet Arrangements

We had no Off-Balance Sheet arrangements during the fiscal year ended September 30, 2014.

ITEM 7A:  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a “smaller reporting company,” we are not required to provide this information under Regulation S-K.

ITEM 8:  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The Company’s financial statements are presented immediately following the signature page to this Form 10-K.

ITEM 9:  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

On November 7, 2014, we changed our auditors when our former auditor informed us they would not be standing for reelection due to their internal business decisions and not related to any disputes with the Company.

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ITEM 9A:  CONTROLS AND PROCEDURES

Our management, with the participation of our principal executive and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Annual Report. Based on that evaluation, our President and Secretary/Treasurer concluded that our disclosure controls and procedures as of the end of the period covered by the Annual Report were effective such that the information required to be disclosed by us in reports filed under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our President and Secretary/Treasurer, as appropriate to allow timely decisions regarding disclosure. A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

Management’s Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes of accounting principles generally accepted in the United States.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.

Our management, with the participation of the President and Secretary/Treasurer, evaluated the effectiveness of our internal control over financial reporting as of September 30, 2014.  In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control - Integrated Framework.  Based on this evaluation, our management, with the participation of the President and Secretary/Treasurer, concluded that, as of September 30, 2014, our internal control over financial reporting was effective.

This Annual Report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting.  Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to the rules of the Security and Exchange Commission that permit the Company to provide only management’s report in this Annual Report.

Changes in Internal Control Over Financial Reporting

There have been no changes in internal control over financial reporting during the last fiscal quarter of our fiscal year ended September 30, 2014.

ITEM 9B:  OTHER INFORMATION

The Company is negotiating a stock purchase agreement for the sale of 3,003,600 shares of the Company’s common stock for proceeds of $100,000.  The funds received from the sale of the shares are to be used to pay existing payables along with all outstanding notes and interest on such notes, including the notes owed to related parties.  It is contemplated as part of the equity raise, a new management team will be put in place with the ability to advance the Company’s business operations and raise additional capital.  There can be no assurance this transaction will close or lead to a definitive agreement.

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PART III

ITEM 10:  DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

Identification of Directors and Executive Officers

Our executive officers and directors and their respective ages, positions and biographical information are set forth below.

Background and Business Experience

Thomas J. Howells - Mr. Howells is 42 years of age. He graduated from Westminster College of Salt Lake City, Utah, with a Bachelor’s degree in Business in 1994 and a Master of Business Administration in 2004. Mr. Howells has been an employee and the Secretary/Treasurer of Jenson Services, Inc. for 15 years, a consulting firm focusing primarily on general business consulting. Mr. Howells has served as an Officer and Director of a number of public companies and was the President and CEO of LipidViro Tech, Inc. until it became NAC Global Technologies, Inc. (“NACG”) in June of 2014.  Mr. Howells is a principal in Plattform Building Systems, Inc., a privately held company in the construction business specializing in precast composite structural floor systems.

Kelly Trimble - Mr. Trimble is 56 years old.  Mr. Trimble has been self-employed for the past 26 years during which time has been involved in personal investments in primarily development stage companies.  Mr. Trimble also provides consulting services to companies, and is a principal in Plattform Building Systems, Inc., a privately held company in the construction business specializing in precast composite structural floor systems.

Travis T. Jenson - Mr. Jenson graduated with honors from Westminster College in 1995 with a B.S. degree.  Since January of 1996, Mr. Jenson, was the President and a director of Jenson Services, Inc., a Utah corporation consulting firm focusing primarily on general business consulting until January of 2014.  Additionally, Mr. Jenson has served on the board of a number of public companies.  On June 25, 2013, Mr. Jenson resigned as the Principal Executive Officer and a director of TC X Calibur, Inc. (OTCBBB: TCXB), a Nevada corporation.

Significant Employees

We do not employ any non-officers who are expected to make a significant contribution to our business.

Family Relationships

There are no family relationships between any of the directors or executive officers of City Media.

Involvement in Other Public Companies

None of our officers and directors are involved in any other public companies except as noted above in Item 10: Directors, Executive Officers, and Corporate Governance; sub-paragraph “Background and Business Experience.”

Involvement in Certain Legal Proceedings

During the past 10 years, none of our present or former directors, executive officers or persons nominated to become directors or executive officers (or those in similar positions with us) has been the subject of any of the following:

(1) A petition under the federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was a general partner at or within two (2) years before the time of such filing, or any

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corporation or business association of which he was an executive officer at or within two (2) years before the time of such filing;

(2) Such person was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);

(3) Such person was the subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him or her from, or otherwise limiting, the following activities:

(i) Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;

(ii) Engaging in any type of business practice; or

(iii) Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities laws or Federal commodities laws;

(4) Such person was the subject of any order, judgment or decree, not subsequently reversed,

suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than sixty (60) days the right of such person to engage in any activity described in paragraph (f)(3)(i) of this section, or to be associated with persons engaged in any such activity;

(5) Such person was found by a court of competent jurisdiction in a civil action or by the SEC to have violated any federal or state securities law, and the judgment in such civil action or finding by the SEC has not been subsequently reversed, suspended, or vacated;

(6) Such person was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;

(7) Such person was the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:

(i) Any federal or state securities or commodities law or regulation; or

(ii) Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or

(iii) Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

(8) Such person was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

Code of Ethics

We have not adopted a Code of Ethics for our principal executive and financial officers, primarily because we believe one is not necessary based upon our current operations and the relationships between our current directors

14

and executive officers and the fact that we have no employees.  

Corporate Governance

Nominating Committee

We have not established a Nominating Committee because, due to our limited operations and the fact that we presently have only three directors and two executive officers, we believe that we are able to effectively manage the issues normally considered by a Nominating Committee.  

If we do establish a Nominating Committee, we will disclose this change to our procedures in recommending nominees to our Board of Directors.

Audit Committee

We have not established an Audit Committee because, due to our limited operations and the fact that we presently have only three directors and two executive officers, we believe that we are able to effectively manage the issues normally considered by an Audit Committee.

ITEM 11:  EXECUTIVE COMPENSATION

All Compensation

The following table sets forth the aggregate compensation paid by us for services rendered during the periods indicated:

SUMMARY COMPENSATION TABLE

ITEM 13:  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTORS INDEPENDENCE

Transactions with Related Persons

The Company has a Service Agreement with Wasatch ATM, a Utah limited liability corporation owned and managed by a Company stockholder.  The agreement provides for Wasatch to provide all maintenance, repair and service work along with provision of vault cash.  Wasatch is compensated at a set rate of $1,400 per month.  The owner of Wasatch ATM, LLC, Calvin K. Jones, is a stockholder of the Company and COO of Charta Systems, our wholly-owned subsidiary. As of September 30, 2014 and 2013, $900 and $1,400, respectively, was due to Wasatch under the contract.

Other Related Party

As of September 30, 2013, the Company had issued $81,000 in convertible promissory notes with various shareholders.  The Company had borrowed a total of $56,901 in principal against these notes.  On January 28, 2014, the Company signed additional convertible promissory notes with certain shareholders that provided for additional liquidity resources in the amount of $15,000, with $15,000 available to be used at the Company’s discretion.  Of these notes, $90,000 in face value convertible promissory notes were consolidated into aggregate convertible promissory notes on February 7, 2014, in the aggregate principal amount of $90,000, with accrued and unpaid interest thereon in the amount of $7,767, as of January 31, 2014.  The Company and the holders of such notes agreed to modify the Notes by: (i) issuing new notes dated as of February 7, 2014 in which the accrued and unpaid interest for each note through January 31, 2014 has been included in the principal balance of the new notes; (ii) extending the due date for the notes to December 31, 2015; (iii) providing that the Notes shall be convertible into shares of the Company's common stock at the option of the Company as previously set forth in the notes or at the holder’s option as set forth in the notes.  All Company notes, with a total face value of $96,000, are now payable on December 31, 2015, accrue interest at a rate of 8.5% per annum, and are convertible at the option of the Company for a conversion price of $0.10 per share.

During the years ending September 30, 2014 and 2013, the Company borrowed additional funds of $20,800 and $20,901, respectively, on these notes.  As of September 30, 2014, the principal outstanding on the consolidated convertible promissory notes was $77,701.

Accrued interest on all loans from shareholders at September 30, 2014 was $12,480, with $7,767 of this amount being applied to a reduction of the available principal amount as a result of the aggregation though reflected as accrued related party interest.  Total interest expense from these notes for the years ended September 30, 2014 and 2013 was $6,625 and $4,252, respectively.

18

We presently utilize the office space of our President, Thomas Howells, and Travis Jenson, a director, at no cost, located at 4685 S. Highland Drive #202, Salt Lake City, Utah 84117.  Pursuant to our agreement with Wasatch ATM, LLC, we utilize, at no costs, space provided by Calvin Jones, a stockholder and an officer of Charta for non-deployed ATMs.  

If the Company completes the sale of equity and raises funds, the intent is to pay existing payables and the notes, including all related party notes.

Transactions with Promoters and Control Persons

There have been no transactions, since the beginning of our last fiscal year, nor are there any currently proposed transactions, in which we were or are to be a participant in which the amount involved exceeds $120,000, and in which any related person had or will have a direct or indirect material interest.

Parents of the Issuer

None; not applicable.

Director Independence

We do not have any independent directors serving on our Board of Directors.

ITEM 14:  PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following is a summary of the fees billed to us by our former principal accountants during the fiscal years ended September 30, 2014, and 2013:

Audit Fees - Consists of fees for professional services rendered by our principal accountants for the audit of our annual financial statements and review of the financial statements included in our Forms 10-Q or services that are normally provided by our principal accountants in connection with statutory and regulatory filings or engagements.

Audit-related Fees - Consists of fees for assurance and related services by our principal accountants that are reasonably related to the performance of the audit or review of our financial statements and are not reported under “Audit fees.”

Tax Fees - Consists of fees for professional services rendered by our principal accountants for tax compliance, tax advice and tax planning.

All Other Fees - Consists of fees for products and services provided by our principal accountants, other than the services reported under “Audit fees,” “Audit-related fees,” and “Tax fees” above.

Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors

We have not adopted an Audit Committee; therefore, there is no Audit Committee policy in this regard. However, we do require approval in advance of the performance of professional services to be provided to us by our principal accountant. Additionally, all services rendered by our principal accountant are performed pursuant to a written engagement letter between us and the principal accountant.

19

PART IV

ITEM 15:  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)(1)(2)

Financial Statements.  See the audited financial statements for the fiscal years ended September 30, 2014, and 2013, in Part II, Item 8 which are set forth following the signature pages and include:

Title of Document

Page

Report of Independent Registered Public Accounting Firm

F-1

Balance Sheet

F-2

Statements of Operations

F-3

Statements of Stockholders’ (Deficit)

F-4

Statements of Cash Flows

F-5

Notes to Financial Statements

Financial Statement Schedules – There are no financial statement schedules are included as part of this report

(a)(3)

Exhibits.  The following exhibits are filed as part of this Annual Report:

(1) As filed with our original Registration Statement on Form S-1 filed on December 30, 2010, File No. 333-171488.

(2) Incorporated herein by reference.

* Filed herewith.

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

20

SIGNATURES

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.

CITY MEDIA, INC.

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.

CITY MEDIA, INC.

21

CityMedia, Inc.

Consolidated Financial Statements

September 30, 2014 and 2013

Table of Contents

F-1

John Scrudato CPA

CERTIFIED PUBLIC ACCOUNTING FIRM

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of
City Media Inc.

We have audited the accompanying balance sheet of City Media Inc. as of September 30, 2014 and the related consolidated statements of operations, changes in stockholders’ deficit and cash flows for the year then ended. These financial statements are the responsibility of the Company management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit 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 consolidated 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 consolidated financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit 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 City Media Inc. at September 30, 2014, and the results of their operations and their cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that City Media Inc. will continue as a going concern. As more fully described in Note 6, the Company had an accumulated deficit at September 30, 2014, a net loss and net cash used in operating activities for the fiscal year then ended. These conditions raise substantial doubt about the ability of the Company to continue as a going concern. Management’s plans in regards to these matters are also described in Note 6. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.

/s/ John Scrudato CPA

Califon, New Jersey
November 17, 2014

                                                                                        7 Valley View Drive Califon, New Jersey 07830

                                                                                         Registered Public Company Accounting Oversight Board Firm  

F-2

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders

City Media, Inc.

We have audited the accompanying consolidated balance sheet of City Media, Inc. and subsidiary as of September 30, 2013, and the related consolidated statements of operations, stockholders’ equity (deficit), and cash flows for the year then ended. 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 audit.

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

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of City Media, Inc. as of September 30, 2013, and the consolidated results of its operations and cash flows for the year ended September 30, 2013, in conformity with accounting principles generally accepted in the United States of America.

/s/ Mantyla McReynolds, LLC

Mantyla McReynolds, LLC

Salt Lake City, Utah

December 16, 2013

F-3

F-6

F-7

CITY MEDIA, INC.

Notes to Consolidated Financial Statements

September 30, 2014

NOTE 1 - ORGANIZATION

City Media, Inc. (the “Company”) was incorporated in the state of Utah in April, 2005.  On or about September 24, 2010, the Company acquired Charta Systems, Inc. (“Charta”) for five million two hundred fifty thousand (5,250,000) shares of the Company’s common stock.  Following the acquisition of the shares, Charta became a wholly owned subsidiary of the Company.  The acquisition was accounted for as a reverse merger and Charta is considered to be the accounting acquirer due to the following factors: (1) Charta’s stockholders received the larger share of the voting rights in the merger; (2) Charta received the majority of the members of the Board of Directors; and (3) Charta’s senior management prior to the merger dominated the senior management of the combined company.  Therefore, the historical financial information included in the financial statements is that of Charta.  While Charta’s ownership became the majority ownership of the Company, the Company will continue under the name City Media, Inc.  Further, the Company approved an amendment to the Company’s Articles of Incorporation.  In addition to other items set forth in the restated and amended Articles, the Company increased the authorized shares to one hundred million (100,000,000) shares, par value $0.001 per share, with ninety million (90,000,000) shares designated as common stock and ten million (10,000,000) shares designated as preferred stock.  There are no preferred shares issued or outstanding and 8,968,000 shares of common stock are outstanding as of the balance sheet date.

The Company owns, maintains and places automated teller machines (“ATMs”) at high traffic consumer locations in Salt Lake City, Utah and surrounding cities.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Cash Equivalents

The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

b. Estimates

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

c. Accounts Receivable

The Company records an account receivable for revenue earned but not yet collected.  If the Company determines any account to be uncollectible based on significant delinquency or other factors, it is immediately written off.  The Company has not had to incur any allowance for bad debt as transaction fees are preapproved prior to a transaction.

F-8

CITY MEDIA, INC.

Notes to Consolidated Financial Statements

September 30, 2014

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

d. Equipment

The primary nature of the Company’s equipment is ATMs.  The ATMs are depreciated utilizing a straight line method.  The useful life of each machine is approximately twelve years.  The remaining useful lives on the machines we are currently utilizing ranges from zero to seven years.  The Company has a policy to immediately expense equipment with a cost of less than $400.

We review our long-lived assets for impairment in accordance with the guidance of FASB ASC 360-10, Property, Plant, and Equipment, whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the capitalized costs of the assets to the future undiscounted net cash flows expected to be generated by the assets and the expected cash flows are based on recent historical cash flows. If the Company decides to dispose of a property, it will be moved to property held for sale and actively marketed. Property held for sale is recorded at amounts not in excess of what management currently expects to receive upon sale, less costs of disposal. The Company analyzes market conditions each reporting period and records additional impairments due to declines in market values of like assets. The fair value of the property is determined by observable inputs such as appraisals and prices of comparable properties in active markets for assets like the Company’s.  Gains are not recognized until the properties are sold.  

e. Revenue Recognition

The Company recognizes revenue on a completed transaction basis.  The revenue earned is the net ATM transaction fees consisting of gross processing fees charged at the point of sale location less any portion of such fee payable to the location owner, as negotiated on a per location basis.  All transactions are preauthorized and no allowance for bad debt is required.  

f. Basic and Diluted Income (Loss) Per Common Share

Basic and diluted net loss per common share has been calculated by dividing the net loss for the year by the basic and diluted weighted average number of shares outstanding.  There were 765,010 common stock equivalents as of September 30, 2014 related to the convertible promissory notes. See Note 5. Those potentially dilutive common stock equivalents were excluded from the diluted loss per share calculation as they would be antidilutive due to the net loss.  

F-9

CITY MEDIA, INC.

Notes to Consolidated Financial Statements

September 30, 2014

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

g. Impact of New Accounting and Reporting Standards  

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

Simplified Testing of Impairment – In July 2012 the FASB issued a new accounting standard that simplifies the impairment test for indefinite-lived intangible assets, other than goodwill. The new guidance gives the option to first assess qualitative factors to determine if it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount as a basis for determining whether it is necessary to perform a quantitative valuation test. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning on or after September 15, 2012. The Company adopted this accounting standard in the first quarter of 2013, and adoption did not have a material impact.

In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP.

The standard is effective for annual periods beginning after December 15, 2016, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures).  We are currently evaluating the impact of our pending adoption of ASU 2014-09 on our consolidated financial statements and have not yet determined the method by which we will adopt the standard in 2017.

h. Intangibles

The Company’s intangible assets represent the allocated value of the purchase price paid for the ATMs when the ATMs were purchased in operating locations with written or implied contracts to continue to house the ATMs for an indefinite period of time, thus exposing the ATMs to the same customer base that existed prior to the purchase.  We test intangible assets determined to have indefinite useful lives for impairment annually, or more frequently if events or circumstances indicate that assets might be impaired. The Company uses a variety of methodologies in conducting impairment assessments of indefinite-lived intangible assets, including, but not limited to, discounted cash flows. For indefinite-lived intangible assets, other than goodwill, if the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess. There were no impairment charges for the years ended September 30, 2014 or 2013.  Impairment charges during the year ended September 30, 2012 totaled $9,808.

F-10

CITY MEDIA, INC.

Notes to Consolidated Financial Statements

September 30, 2014

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

i. Income Taxes

The Company applies the provisions of Financial Accounting Standards Board Accounting Standard Codification (“ASC”) 740 Income Taxes.  The Standard requires an asset and liability approach for financial accounting and reporting for income taxes, and the recognition of deferred tax assets and liabilities for the temporary differences between the financial reporting basis and tax basis of the Company’s assets and liabilities at enacted tax rates expected to be in effect when such amounts are realized or settled. Due to a loss from inception, the Company has no tax liability.

The Company classifies tax-related penalties and net interest on income taxes as income tax expense. As of September 30, 2014 and 2013, no income tax expense had been incurred.

j. Consolidation

The financial statements of the Company have been prepared in accordance with U. S. generally accepted accounting principles. The consolidated financial statements of the Company include the accounts of City Media, Inc. and its wholly-owned subsidiary, Charta Systems, Inc. All significant intercompany transactions have been eliminated.

NOTE 3 – INCOME TAXES

On or about September 28, 2010 in relation to the acquisition of Charta Systems, Inc., the Company changed its fiscal year end from December 31 to September 30.  Consequently, the Company filed a short-year return for the 2010 tax year.  Prior to the reverse merger on September 24, 2010, Charta was an S-Corporation and was taxed at the stockholder level.  All income tax activity for the remainder of the short year ended September 30, 2010 was nominal. All prior period net operating losses at the parent level are subject to the Section 382 limitation as a result of the Company undergoing a more than 50% change in ownership.  As a result of the limitation, the Company expects to receive zero or minimal future benefits from prior period net operating losses.

The provision for income taxes consists of the following:

Below is a summary of deferred tax asset calculations on net operating loss carry forward amounts as of September 30, 2014.  Currently there is no reasonable assurance that the Company will be able to take advantage of a deferred tax asset. Thus, an offsetting allowance has been established for the deferred asset.

F-11

CITY MEDIA, INC.

Notes to Consolidated Financial Statements

September 30, 2014

NOTE 3 – INCOME TAXES (continued)

During the years ended September 30, 2014 and 2013, the valuation allowance increased $6,139 and $3,576, respectively.

The Company has the following operating loss carry forwards available at September 30, 2014:

Reconciliation between income taxes at the statutory tax rate (20%) and the actual income tax provision for continuing operations follows:

Uncertain Tax Positions

The Company has evaluated its uncertain tax positions as required by ASC 740 and determined that any required adjustments would not have a material impact on the Company’s balance sheet, statement of operations, or statement of cash flows.

A reconciliation of our unrecognized tax benefits for 2013 is presented in the table below:

The tax years 2011 through 2014 remain open to examination for federal income tax purposes and by other major taxing jurisdictions to which we are subject.

F-12

CITY MEDIA, INC.

Notes to Consolidated Financial Statements

September 30, 2014

NOTE 4 – RELATED PARTY TRANSACTIONS / SERVICE AGREEMENT

The Company has a Service Agreement with Wasatch ATM (“Wasatch”), a Utah limited liability corporation owned and managed by a Company stockholder.  The agreement provides for Wasatch to provide all maintenance, repair and service work along with distribution of vault cash.  Wasatch is compensated at a set rate of $900 per month, resulting from a reduction on January 1, 2014 from $1,400.  The term of the agreement will be for a period of two (2) years from the date of the agreement, and will automatically renew for additional one (1) year periods, unless either party gives the other written notice of termination thirty (30) days prior to any renewal term, and provides for an additional one-time $500 payable upon the placement of each additional ATM and an allowance of $500 per quarter for expenses.  

As of September 30, 2014 and 2013, $900 and $1,400, respectively, was due to Wasatch, which is included in the “Related Party Accounts Payable” line item.

NOTE 5 - RELATED PARTY TRANSACTIONS / LONG-TERM DEBT

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

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

As of September 30, 2013, the Company had issued $81,000 in convertible promissory notes with various shareholders.  The Company had borrowed a total of $56,901 in principal against these notes.  On January 28, 2014, the Company signed additional convertible promissory notes with certain shareholders that provided for additional liquidity resources in the amount of $15,000, with $15,000 available to be used at the Company’s discretion.  Of these notes, $90,000 in face value convertible promissory notes were consolidated into aggregate convertible promissory notes on February 7, 2014, in the aggregate principal amount of $90,000, with accrued and unpaid interest thereon in the amount of $7,767, as of January 31, 2014.  The Company and the holders of such notes agreed to modify the Notes by: (i) issuing new notes dated as of February 7, 2014 in which the accrued and unpaid interest for each note through January 31, 2014 has been included in the principal balance of the new notes; (ii) extending the due date for the notes to December 31, 2015; (iii) providing that the Notes shall be convertible into shares of the Company's common stock at the option of the Company as previously set forth in the notes or at the holder’s option as set forth in the notes.  All Company notes, with a total face value of $96,000, are now payable on December 31, 2015, accrue interest at a rate of 8.5% per annum, and are convertible at the option of the Company for a conversion price of $0.10 per share.

During the years ending September 30, 2014 and 2013, the Company borrowed additional funds of $20,800 and $20,901, respectively, on these notes.  As of September 30, 2014, the principal outstanding on the consolidated convertible promissory notes was $77,701.

Accrued interest on all loans from shareholders at September 30, 2014 was $12,480, with $7,767 of this amount being applied to a reduction of the available principal amount as a result of the aggregation though reflected asaccrued related party interest.  Total interest expense from these notes for the years ended September 30, 2014 and 2013 was $6,625 and $4,252, respectively.

F-13

CITY MEDIA, INC.

Notes to Consolidated Financial Statements

September 30, 2014

NOTE 5 - RELATED PARTY TRANSACTIONS / LONG-TERM DEBT (continued)

Current available funds pursuant to outstanding promissory notes as of September 30, 2014 is $10,532.

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

NOTE 6 – GOING CONCERN

The Company has minimal working capital, limited sales activity, losses from operations, and negative cash flows from operations.  These factors raise substantial doubt about the Company's ability to continue as a going concern. Management plans include continuing to place, manage and service ATM machines.  In addition, the Company may seek additional debt or equity funding from shareholders.  If additional financing is not provided, the Company may be required to curtail its operations.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

NOTE 7 – STOCKHOLDERS’ EQUITY

On or about September 24, 2010, the Company acquired Charta Systems, Inc. (“Charta”) for five million two hundred fifty thousand (5,250,000) shares of the Company’s common stock.  Following the acquisition of the shares, Charta became a wholly owned subsidiary of the Company.  Accordingly, the Company approved an amendment to the Company’s Articles of Incorporation.  There are no preferred shares issued or outstanding and 8,968,000 shares of common stock are outstanding as of the balance sheet date.

NOTE 8 – SUBSEQUENT EVENT

On November 17, 2014, the Company entered into an agreement to sell 3,003,600 shares of its $0.001 par value common stock to Weed Growth Fund, Inc. for total proceeds of approximately $100,000.  The proceeds of this sale will be used to pay off existing obligations, including our notes payable.  The existing obligations will require the entire amount of the proceeds and no additional funds will be available for ongoing operations.  Additionally, as part of the agreement, new management will be appointed, including new officers and directors.

F-14