10K Annual Report out - a few highlights:
As of April 14, 2014, the registrant had 21,856,719 shares of common stock outstanding (compared to 823,610,674 shares (1,098,147 post split) on Nov. 18, 2013) - an increase of 1890%
As of December 31, 2013, the company had 46 convertible debentures in the aggregate principal amount of $1,000,289 with accrued interest payable of $52,209.
During our fourth quarter ended December 31, 2013, the company issued 410,669 shares to the executive officers and directors for services valued at $616,000.
During the fiscal year ended December 31, 2013, the Company did not repurchase any of their securities.
The Company has a working capital deficit of $3,636,148 at December 31, 2013.
The Company had an accumulated deficit of $9,725,808 (up from about $6.9 million for the previous quarter - an increase of about 41%).
Sales of the dolls began in October 2013, and they had total gross sales of $20,549 for the year ended December 31, 2013 (or about 936 dolls at $21.95 each). Cost of sales for the dolls was $16,479 (or about a 20% net margin per doll) - gross profit = $4,070.
G&A expenses increased to over $3.3 million for the year, primarily attributed to contract services ($2.4 million) and advertising ($284k). Or putting it another way, the company paid out $817 in G&A expense for every dollar received in sales.
Interest expense continues to be a drain on resources, totalling $619k for the year.
Net loss increased to $6,848,920 for the year ended December 31, 2013 from $1,258,273 for the year ended December 31, 2012.
The Company states "We do not have sufficient cash on hand at December 31, 2013 to fund future operations."
The company believes that their operating expenses will increase over the next 12 months and estimate that their capital requirements for the next 12 months will be exceed $1.5 million - $300k for capital requirements to grow the business (tooling, warehousing, manufacturing, etc), and the remining $1.2 million on marketing, public relations, G&A).
During 2013, the Company paid executive officers (Melton, Gauger, and McBride-Irby) $670k, Directors (Delaney and Robert Hines - former CEO of SEC suspended EVSO) $238k, Founder (Trent) $261k, and Family of officers/directors another $126k for compensation (salary) expenses.
In addition to the above, the following was paid for "consulting and professional fee" expenses: Founder (Trent) = $204k, plus family of officers and directors = $105k.
Asher Enterprises still shown as a beneficial owner of 7.12% of the stock.
Subsequent events after Dec. 31:
The Company incurred additional indebtedness totaling $281,000, consisting of convertible promissory notes totaling $201,000 and short-term promissory notes and advances totaling $80,000
The Company repaid indebtedness totaling $98,726.
The Company issued a total of 20,632,129 shares of their common stock: 39,668 shares for unissued common shares; 388 shares for rounding of reverse split shares; 16,200,000 shares to their founder, officers and directors for services valued at $972,000; 340,000 shares for consulting services valued at $20,400; and 4,052,073 shares for debt conversion of $60,529 (nice bonus!!)
An investor exercised a contractual right to reset the conversion price of a December 2013 debt conversion, resulting in the principal amount of the related convertible debt increasing from $30,000 to $47,455
