Some excerps from the 10KSB
Revenues:
For the year ended July 31, 2008, our revenues decreased by 70.4%, or $36,182, to $15,208 as compared to $51,390 for the fiscal year ended July 31, 2007. The decrease in revenues was primarily the result of our not having enough sales people selling our child care products, which resulted in fewer sales to existing customers. In addition, as a result of the foreign currency exchange, we were less competitive to customers located in the United States.
LIQUIDITY AND CAPITAL RESOURCES
As of July 31, 2008, we had total current assets of $2,802 and total current liabilities of $2,155,893, resulting in a working capital deficit of $2,153,091. As of that date, we had cash of $2,802. Our cash flow from operating activities for the year ended July 31, 2008 resulted in a deficit of $4,772 which was primarily the result of a reduction in overall sales, which thereby decreased our ability to generate cash flow from our operations.
As of July 31, 2008, we had a $1,766,210 note payable and a $292,083 advance to Metro One Development, Inc., payable on demand. We do not know when Metro One Development, Inc. will demand payment on this advance. However, should Metro One Development, Inc. demand payment, we would need additional capital to repay this obligation.
As part of our acquisition of assets from Metro One Development, Inc. (formerly On The Go Healthcare, Inc.), we agreed to issue $250,000 worth of our common stock and two promissory notes in the aggregate amount of $1,005,000. On February 23, 2006, we replaced the original promissory notes and issued to Metro One Development, Inc. two Secured Promissory Notes with a face value of $1,206,000. The increase from $1,005,000 to $1,206,000 represents a full year of accrued interest. Although a full year of interest had not yet accrued, we agreed to include interest of $201,000 as opposed to $128,860 as consideration for replacing the original note. We must repay the Secured Promissory Notes one year from March 11, 2008, the date our registration statement was declared effective by the Securities and Exchange Commission. Until that time, on July 3, 2006 and each anniversary thereafter, the face value of the Secured Promissory Notes will increase by 20% until such time as the Secured Promissory Notes are paid in full. The Secured Promissory Notes pay 20% simple annual interest. We may prepay the Secured Promissory Notes at any time, with accrued interest and without penalty. At the year ended July 31, 2007, the Secured Promissory Notes had a principal balance of $1,447,200.
Until such a time when we are able to generate positive cash flows from operations in an amount sufficient to cover our current liabilities and debt obligations as they become due, we will remain reliant on borrowing funds or selling equity.
We intend to raise funds through the issuance of debt or equity. Raising funds in this manner typically requires significant time and effort to find accredited investors, and the terms of such an investment must be negotiated for each investment made. We cannot guarantee that we will be able to raise sufficient funds to meet our obligations. If we do not raise sufficient funds, our operations will be curtailed or will cease entirely and you may lose all of your investment
I would have included some of the positives if I could have found any.
