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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
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[X]
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ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended October 31, 2010
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[ ]
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TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
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For the transition period from _________ to ________
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Commission file number: 333-148922
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Jumpkicks, Inc.
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(Exact name of registrant as specified in its charter)
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Delaware
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26-0690857
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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632 Marsh Creek Court, Henderson, NV
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89002
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number: 702-752-1515
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Securities registered under Section 12(b) of the Exchange Act:
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Title of each class
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Name of each exchange on which registered
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none
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not applicable
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Securities registered under Section 12(g) of the Exchange Act:
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Title of each class
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Common Stock, par value $0.001
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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 Section 15(d) of the Act. Yes [ ] No [X]
Indicate by checkmark 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 proceeding 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 (§ 229.405 of this chapter) 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. [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [X] No [ ]
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter. Not available
Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date. 10,860,000 as of January 27, 2011.
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PART I
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PART II
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PART III
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PART IV
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PART I
Company Overview
We were incorporated as Jumpkicks, Inc. (“Jumpkicks”) in the State of Delaware on August 3, 2007 to engage in the business of online retailing.
We purchased and further developed a martial arts website (the “Site”). Through the Site, we provide content of interest to martial artists and sell products, such as uniforms, t-shirts, protective equipment, mats, and other equipment and accessories of interest to martial arts practitioners and instructors.
We sought to draw martial arts students and practitioners to our site by positioning ourselves as a source of martial arts knowledge. We anticipated that a certain percentage of visitors to our Site will become retail customers, purchasing the equipment we display in our online catalog. Although we offered discounted retail pricing to individual martial arts practitioners and students, demand for these products has been very limited.
During May of 2008, an unknown third party changed the registration of our domain name, www.jumpkicks.com, so that our Site became inaccessible. We have investigated this change in registration, and we contracted with a third party to negotiate the return of our domain name. However, we have been unable to re-acquire the domain name www.jumpkicks.com.
We have purchased additional domain names, www.jumpkicks.net, www.jumpkicks.org, www.jumpkicks.us, and www.jumpkicks.info. We have uploaded our Site to these domain names, and have pursued our business plan with these alternate sites.
Unfortunately, the domain name www.jumpkicks.com lent significant value to our company. The long history of the Site drew regular repeat traffic. We have attempted to draw traffic to the new domain names, but have been unable to do so successfully. Because we have not been able to generate significant traffic, we have not been able to generate significant revenue from sales to support our operations.
Our offices are located at 632 Marsh Creek Court, Henderson, Nevada 89002, and our telephone number is 702-752-1515. Our Internet Site can be found at www.Jumpkicks.net. Information contained on our Web Site is not part of this periodic report.
Richard Douglas is our President, Secretary, Chief Executive Officer, Chief Financial Officer, and sole director.
Plant and Significant Equipment
We do not intend to purchase or sell any plants or significant equipment in the next twelve months.
Intellectual Property
We have not filed a trademark application to register the name or the URL for our Site. To date, we do not own any other patent, trademark, or legally enforceable claim to proprietary intellectual property.
Employees
We have no significant employees other than our sole officer and director, Richard Douglas.
Research and Development Expenditures
We have not incurred any research or development expenditures since our incorporation.
Government Regulation
Government regulation and compliance with environmental laws do not have a material effect on our business. We are subject to the laws and regulations of those jurisdictions in which we plan to operate and sell our products, which are generally applicable to business operations, such as business licensing requirements, income taxes and payroll taxes. In general, the publishing of our Site and the sale of our products are not subject to special regulatory and/or supervisory requirements.
Subsidiaries
We do not own any subsidiaries.
We do not lease or own any real property. We maintain our corporate office at 632 Marsh Creek Court, Henderson, NV. This office space is being provided free of charge by our president, Richard Douglas. While limited in size, our present corporate office provides facilities suited to our current operations. This arrangement provides us with the office space necessary to process necessary paper work while providing telephone, fax and mailing facilities. As our business operations grow, it may be necessary for us to seek additional office space.
Item 3. Legal Proceedings
We are not a party to any pending legal proceeding. We are not aware of any pending legal proceeding to which any of our officers, directors, or any beneficial holders of 5% or more of our voting securities are adverse to us or have a material interest adverse to us.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of the Company's shareholders during the fiscal year ended October 31, 2010.
PART II
Item 5. Market for Registrant’s Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Information
Our common stock is currently quoted on the OTC Bulletin Board (“OTCBB”), which is sponsored by FINRA. The OTCBB is a network of security dealers who buy and sell stock. The dealers are connected by a computer network that provides information on current "bids" and "asks", as well as volume information. Our shares are quoted on the OTCBB under the symbol “JKIK”
The following table sets forth the range of high and low bid quotations for our common stock for each of the periods indicated as reported by the OTCBB. These quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.
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Fiscal Year Ending October 31, 2010
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Quarter Ended
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High $
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Low $
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October 31, 2010
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N/A
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N/A
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July 31, 2010
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N/A
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N/A
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April 30, 2010
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N/A
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N/A
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January 31, 2009
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N/A
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N/A
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Fiscal Year Ending October 31, 2009
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Quarter Ended
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High $
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Low $
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October 31, 2009
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N/A
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N/A
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July 31, 2009
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N/A
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N/A
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April 30, 2009
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N/A
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N/A
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January 31, 2008
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N/A
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N/A
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Penny Stock
The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a market price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the SEC, that: (a) contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading; (b) contains a description of the broker's or dealer's duties to the customer and of the rights and remedies available to the customer with respect to a violation of such duties or other requirements of the securities laws; (c) contains a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and the significance of the spread between the bid and ask price; (d) contains a toll-free telephone number for inquiries on disciplinary actions; (e) defines significant terms in the disclosure document or in the conduct of trading in penny stocks; and (f) contains such other information and is in such form, including language, type size and format, as the SEC shall require by rule or regulation.
The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with (a) bid and offer quotations for the penny stock; (b) the compensation of the broker-dealer and its salesperson in the transaction; (c) the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and (d) a monthly account statement showing the market value of each penny stock held in the customer's account.
In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written acknowledgment of the receipt of a risk disclosure statement, a written agreement as to transactions involving penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements may have the effect of reducing the trading activity for our common stock. Therefore, stockholders may have difficulty selling our securities.
Holders of Our Common Stock
As of October 31, 2010, we had 10,860,000 shares of our common stock issued and outstanding, held by 35 shareholders of record.
Dividends
We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future.
In the event that a dividend is declared, common stockholders on the record date are entitled to share ratably in any dividends that may be declared from time to time on the common stock by our board of directors from funds legally available.
There are no restrictions in our Certificate of Incorporation or bylaws that restrict us from declaring dividends. The Delaware General Corporation Law provides that a corporation may pay dividends out of surplus, out the corporation's net profits for the preceding fiscal year, or both provided that there remains in the stated capital account an amount equal to the par value represented by all shares of the corporation's stock raving a distribution preference.
Securities Authorized for Issuance under Equity Compensation Plans
We do not have any equity compensation plans.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements
Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. We intend such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of complying with those safe-harbor provisions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse affect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Further information concerning our business, including additional factors that could materially affect our financial results, is included herein and in our other filings with the SEC.
Plan of Operation in the Next Twelve Months
URL
During May of 2008, an unknown third party changed the registration of our domain name, www.jumpkicks.com, so that our Site became inaccessible. We have investigated this change in registration, and we contracted with a third party to negotiate the return of our domain name. However, we have been unable to re-acquire the domain name www.jumpkicks.com.
We have purchased additional domain names, www.jumpkicks.net, www.jumpkicks.org, www.jumpkicks.us, and www.jumpkicks.info. We have uploaded our Site to these domain names, so that we will remain operational while we work to regain control of our original domain name.
Unfortunately, the domain name www.jumpkicks.com lent significant value to our company. The long history of the Site drew regular repeat traffic. We are now attempting to draw traffic to the new domain names, but we have thus far been unable to do so successfully. If we are not able to generate significant traffic, we will not be able to generate significant revenue to support our operations.
Site Development
Our site is currently operational and publicly available in a beta format. We have not, thus far, been able to generate sufficient revenue to finance the proposed redevelopment of the Site. The redeveloped site would contain at least two new sections. The first is a Tournaments section. This will include a schedule of martial arts tournaments around the country. We had hoped that martial artists would come to our Site to find information on local and national tournaments. After a tournament, we intended to include photos from the tournament, so that participants could log on to our Site to view and download photos of themselves and other competitors. We felt that this strategy would draw a large number of viewers to our Web Site.
The final section we hoped to include in the redeveloped Web Site was our Online Catalog. We have already added a section to our Site containing a small list of products, which we have been offering for sale to our Site visitors. However, we intended to overwrite this temporary page with a permanent Online Catalog that would necessarily be developed by a contracted Site developer. Our only current source and our only planned source of revenue is the retail sales generated through our Online Catalog. The other sections of the Site are intended to draw traffic to the Site. We have worked under the assumption that a certain percentage of visitors to our Site will become retail customers, purchasing the equipment we display in our online catalog. Unfortunately, our inability to draw customers to the new URL has thus hampered our ability to generate revenue through sales.
We have approached a large wholesale martial arts supplier and proposed a partnership whereby our customers could order from their site, which we would display as a section of our Site. They could they bill and ship directly to the customers. While we have made proposals, they have not been met with much enthusiasm by the wholesalers, and we are doubtful that a deal will be reached.
At this point in time, we do not have the financial resources to pay a web site designer to redevelop our Site. If we are able to acquire additional capital through debt or equity financing, we will then seek to contract with a web site designer. However, we currently do not have a viable plan to raise the capital necessary for a Site redesign.
Increase Product Offerings
We currently offer fewer than twenty unique products for sale through our Online Catalog. If we are able to increase our online orders, we intend to increase our inventory level to reduce turnaround time for customers and to offer a greater number of products for sale. By offering a greater selection to the online shopping public, we hope to increase the volume of our sales and thereby increase our revenue and net income. Our suppliers offer thousands of products, and we have worked with them to determine the most popular items, so we could incorporate them sooner than others and achieve a high level of efficiency in our business operations.
Marketing
Our plan has been to draw martial arts students and practitioners to our site by positioning ourselves as a source of martial arts knowledge. While our previous domain name had been used as a resource for martial artists around the world since 1996, we have had to start over to generate interest in our new domain names and have had very limited success in doing so. If we are able to raise funds through financing, we hope to position the Site as a vital resource for instructors and students alike by engaging in the following:
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Updating the most popular section of the Web Site regularly. A new Move of the Week will bring back repeat users each week to learn a new technique for themselves or their students;
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Working with tournament promoters to cross promote our Web Site, providing t-shirts and other door prizes with our logo and Site URL on them, as well as promoting their tournaments on our Site;
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Posting photos of tournaments on our Web Site, drawing competitors, fans, and promoters to our Site to view, save, and print the photos;
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Working with our Site developer to include meta tags and other design elements in a fashion that will result in our Web Site being listed at or near the top of search engine listings for phrases such as martial arts, karate, self-defense techniques, martial arts supplies, rape prevention, karate tournaments, etc.
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We currently have forecasted the expenditure of approximately $20,000 during the next twelve months in order to pursue our business plan and remain in compliance with the reporting requirements of the Securities Exchange Act of 1934. The completion of our business plan for the next 12 months is contingent upon us obtaining additional financing. If we are unable to obtain additional financing, our business plan will be significantly impaired. We do not have any formal commitments or arrangements for the sales of stock or the advancement or loan of funds. Without the necessary cash flow, we will not be able to pursue our plan of operations until such time as the necessary funds are raised in the equity securities market.
We do not anticipate purchasing any real property or significant equipment during the next 12 months.
At the present time we have no employees other than our sole officer and director, Mr. Richard Douglas. We do not anticipate hiring any employees until such time as we are able to acquire any additional businesses.
Results of Operations for the year ended October 31, 2010 and 2009 and for the period from August 3, 2007 (Date of Inception) until October 31, 2010
We generated revenue from sales of $0 for the year ended October 31, 2010. Our Operating Expenses equaled $58,563, and Cost of Goods Sold was $0 during the year ended October 31, 2010. The primary components of our Operating Expenses were Bad Debt Expense of $150, General and Administrative Expenses of $390, Depreciation Expense of $1,212, and Professional Fees of $56,811. Thus, our Net Loss for the year ended October 31, 2010, was $58,563.
We generated revenue from sales of $1,015 for the year ended October 31, 2009. Our Operating Expenses equaled $16,700, and Cost of Goods Sold was $1,165 during the year ended October 31, 2009. The primary components of our Operating Expenses were General and Administrative Expenses of $581, Depreciation Expense of $1,212, and Professional Fees of $14,907. Thus, our Net Loss for the year ended October 31, 2009, was $16,850.
We generated revenue from sales of $1,226 for the period from Inception (August 3, 2007) through October 31, 2010. Our Cost of Goods Sold was $1,614 for the period. Our Operating Expenses for the period from Inception (August 3, 2007) through October 31, 2010 equaled $101,786. The primary components of our Operating Expenses were Bad Debt Expense of $150, General and Administrative Expenses of $6,289, Depreciation Expense of $3,737, and Professional Fees of $91,610. After considering interest income of $118, our Net Loss for the period from Inception (August 3, 2007) through October 31, 2010, was $102,056.
We anticipate our operating expenses will increase as we more fully implement our business plan. The increase will be attributable to expenses to operating our business, and the professional fees to be incurred in connection with our reporting obligations as a public company as our business activity increases.
Liquidity and Capital Resources
As of October 31, 2010, we had total current assets of $892. We had $78,057 in current liabilities as of October 31, 2010. Thus, we had a working capital deficit of $77,165 as of October 31, 2010.
For the years ended October 31, 2010 and October 31, 2009, and for the period from Inception (August 3, 2007) through October 31, 2010, operating activities have used Net Cash of $390, $14,588 and $32,762, respectively. The primary factors in this negative operational cash flow were our net losses of $58,563, $16,850, and $102,056, respectively, offset primarily by changes in accounts payable.
We generated $1,000 in cash from financing activities during the year ended October 31, 2010, due to loans from shareholder of the same amount, $11,500 in cash from financing activities during the year ended October 31, 2009, due to loans from shareholder of the same amount and we generated $39,700 in cash from financing activities during the period from Inception (August 3, 2007) through October 31, 2010, due to an equity offering of $27,200 and the aforementioned loans from shareholder of $12,500.
There was no positive or negative cash flow due to investing activities during the years ended October 31, 2010 or October 31, 2009. Investing Activities used $6,046 in cash for the period from Inception (August 3, 2007) through October 31, 2010.
We expect that we will need to spend approximately $20,000 to further develop and market our Site, and to pay the professional fees associated with our business over the next twelve (12) months. As of October 31, 2010, we have insufficient cash to operate our business at the current level for the next twelve months and insufficient cash to achieve our business goals. The success of our business plan during the next 12 months and beyond is contingent upon us obtaining additional financing. We hope to obtain business capital through the use of private equity fundraising or shareholders loans. We do not have any formal commitments or arrangements for the sales of stock or the advancement or loan of funds at this time. There can be no assurance that such additional financing will be available to us on acceptable terms, or at all.
Going Concern
The accompanying financial statements have been prepared in conformity with generally accepted accounting principle, which contemplate continuation of the Company as a going concern. However, we have an accumulated deficit of $102,056 as of October 31, 2010. We currently have negative liquidity, and have not completed our efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time, which according to our auditors, raises substantial doubt about our ability to continue as a going concern.
Management anticipates that we will be dependent, for the near future, on additional investment capital to fund operating expenses. We intend to position ourselves so that may be able to raise additional funds through the capital markets. In light of management’s efforts, our auditors have expressed doubt that we will be successful in this or any of our endeavors or become financially viable and continue as a going concern.
Off Balance Sheet Arrangements
As of October 31, 2010, there were no off balance sheet arrangements.
Critical Accounting Policies
In December 2001, the SEC requested that all registrants list their most “critical accounting polices” in the Management Discussion and Analysis. The SEC indicated that a “critical accounting policy” is one which is both important to the portrayal of a company’s financial condition and results, and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. Our “critical accounting polices” are listed in the notes attached to our consolidated financial statements.
Recently Issued Accounting Pronouncements
Recently issued accounting pronouncements are addressed in the notes attached to our consolidated financial statements.
Item 8. Financial Statements and Supplementary Data
Index to Financial Statements Required by Article 8 of Regulation S-X:
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Audited Financial Statements:
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Phone (248) 203-0080
Fax (248) 281-0940
30600 Telegraph Road, Suite 2175
Bingham Farms, MI 48025-4586
www.sucpas.com
Report of Independent Registered Public Accounting Firm
To the Board of Directors of
Jumpkicks, Inc.
Henderson, Nevada
We have audited the accompanying balance sheets of Jumpkicks, Inc. (the “Company”) as of October 31, 2010 and 2009, and the related statements of operations, stockholders’ deficit, and cash flows for the years then ended and for the period from August 3, 2007 (inception) through October 31, 2010. 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, 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 Jumpkicks, Inc. as of October 31, 2010 and 2009 and the results of its operations and its cash flows for the years then ended and the period from August 3, 2007 (inception) through October 31, 2010 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 negative working capital, has limited revenue from sales of products or services, and has incurred losses from operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans with regard to these matters are described in Note 2. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Silberstein Ungar, PLLC
Bingham Farms, Michigan
January 26, 2011
(A Development Stage Company)
As of October 31, 2010 and 2009
| ASSETS |
October 31, 2010
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October 31, 2009
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CURRENT ASSETS
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Cash
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$ |
892 |
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$ |
282 |
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Accounts receivable
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- |
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150 |
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Total Current Assets
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892 |
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432 |
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PROPERTY AND EQUIPMENT, net
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2,309 |
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3,521 |
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TOTAL ASSETS
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$ |
3,201 |
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$ |
3,953 |
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LIABILITIES AND STOCKHOLDERS' DEFICIT
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CURRENT LIABILITIES
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Accrued expenses
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$ |
65,557 |
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$ |
8,746 |
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Shareholder loan
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12,500 |
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11,500 |
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Total Liabilities
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78,057 |
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20,246 |
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STOCKHOLDERS' DEFICIT
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Preferred stock - $0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding
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- |
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- |
Common stock - $0.001 par value; 90,000,000 shares authorized; 10,860,000 shares issued and outstanding
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10,860 |
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10,860 |
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Additional paid in capital
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16,340 |
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16,340 |
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Deficit accumulated during the development stage
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(102,056) |
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(43,493) |
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Total Stockholders' Deficit
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(74,856) |
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(16,293) |
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TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT
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$ |
3,201 |
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$ |
3,953 |
The accompanying notes are an integral part of these financial statements.
(A Development Stage Company)
Statements of Operations
For the Years Ended October 31, 2010 and 2009
For the Period from August 3, 2007 (Inception) through October 31, 2010
| |
For the Year Ended October 31, 2010
|
|
For the Year Ended October 31, 2009
|
|
For the Period from August 3, 2007 (Inception) through October 31, 2010
|
| |
|
|
|
|
|
|
REVENUES
|
$ |
- |
|
$ |
1,015 |
|
$ |
1,226 |
|
COST OF GOODS SOLD
|
|
- |
|
|
1,165 |
|
|
1,614 |
|
GROSS PROFIT
|
|
- |
|
|
(150 |
|
|
(388) |
| |
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
|
Depreciation expense
|
|
1,212 |
|
|
1,212 |
|
|
3,737 |
|
Professional fees
|
|
56,811 |
|
|
14,907 |
|
|
91,610 |
|
Bad debt expense
|
|
150 |
|
|
- |
|
|
150 |
|
General and administrative
|
|
390 |
|
|
581 |
|
|
6,289 |
| |
|
|
|
|
|
|
|
|
|
TOTAL OPERATING EXPENSES
|
|
58,563 |
|
|
16,700 |
|
|
101,786 |
| |
|
|
|
|
|
|
|
|
|
LOSS FROM OPERATIONS
|
|
(58,563) |
|
|
(16,850) |
|
|
(102,174) |
| |
|
|
|
|
|
|
|
|
|
OTHER INCOME
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
- |
|
|
- |
|
|
118 |
| |
|
|
|
|
|
|
|
|
|
TOTAL OTHER INCOME
|
|
- |
|
|
- |
|
|
118 |
| |
|
|
|
|
|
|
|
|
|
LOSS BEFORE INCOME TAXES
|
|
(58,563) |
|
|
(16,850) |
|
|
(102,056) |
|
INCOME TAX EXPENSE
|
|
- |
|
|
- |
|
|
- |
| |
|
|
|
|
|
|
|
|
|
NET LOSS
|
$ |
(58,563) |
|
$ |
(16,850) |
|
$ |
(102,056) |
| |
|
|
|
|
|
|
|
|
|
NET LOSS PER SHARE: BASIC AND DILUTED
|
$ |
(0.01) |
|
$ |
(0.00) |
|
|
|
| |
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED
|
|
10,860,000 |
|
|
10,860,000 |
|
|
|
The accompanying notes are an integral part of these financial statements.
(A Development Stage Company)
Statement of Stockholders' Deficit
As of October 31, 2010
| |
Common Stock
|
|
Additional
Paid-in
|
|
Deficit
Accumulated
during the
Development
|
|
|
| |
Shares
|
|
Amount
|
|
Capital
|
|
Stage
|
|
Total
|
| |
|
|
|
|
|
|
|
|
|
|
Balance August 3, 2007
|
|
- |
|
$ |
- |
|
$ |
- |
|
$ |
- |
|
$ |
- |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock issued for cash at $0.001 per share
|
|
10,000,000 |
|
|
10,000 |
|
|
- |
|
|
- |
|
|
10,000 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock issued for cash at $0.02 per share
|
|
860,000 |
|
|
860 |
|
|
16,340 |
|
|
- |
|
|
17,200 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the period ended October 31, 2007
|
|
- |
|
|
- |
|
|
- |
|
|
(3,767) |
|
|
(3,767) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, October 31, 2007
|
|
10,860,000 |
|
|
10,860 |
|
|
16,340 |
|
|
(3,767) |
|
|
23,433 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the year ended October 31, 2008 (restated)
|
|
- |
|
|
- |
|
|
- |
|
|
(22,876) |
|
|
(22,876) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, October 31, 2008 (restated)
|
|
10,860,000 |
|
|
10,860 |
|
|
16,340 |
|
|
(26,643) |
|
|
557 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the year ended October 31, 2009
|
|
- |
|
|
- |
|
|
- |
|
|
(16,850) |
|
|
(16,850) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, October 31, 2009
|
|
10,860,000 |
|
|
10,860 |
|
|
16,340 |
|
|
(43,493) |
|
|
(16,293) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the year ended October 31, 2010
|
|
- |
|
|
- |
|
|
- |
|
|
(58,563) |
|
|
(58,563) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, October 31, 2010
|
|
10,860,000 |
|
$ |
10,860 |
|
$ |
16,340 |
|
$ |
(102,056) |
|
$ |
(74,856) |
The accompanying notes are an integral part of these financial statements.
(A Development Stage Company)
Statements of Cash Flows
For the Years Ended October 31, 2010 and 2009
For the Period from August 3, 2007 (Inception) through October 31, 2010
| |
For the Year Ended October 31, 2010
|
|
For the Year Ended October 31, 2009
|
|
For the Period from August 3, 2007 (Inception) through October 31, 2010
|
|
OPERATING ACTIVITIES
|
|
|
|
|
|
|
Net loss for the period
|
$ |
(58,563) |
|
$ |
(16,850) |
|
$ |
(102,056) |
|
Adjustments to reconcile net loss to net cash used by operating activities:
|
|
|
|
|
|
|
|
|
|
Depreciation expense
|
|
1,212 |
|
|
1,212 |
|
|
3,737 |
|
Bad debt expense
|
|
150 |
|
|
- |
|
|
150 |
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
Changes in inventory
|
|
- |
|
|
- |
|
|
- |
|
Changes in accounts receivable
|
|
- |
|
|
(150) |
|
|
(150) |
|
Changes in accrued expenses
|
|
56,811 |
|
|
1,200 |
|
|
65,557 |
| |
|
|
|
|
|
|
|
|
|
Net Cash Used in Operating Activities
|
|
(390) |
|
|
(14,588) |
|
|
(32,762) |
| |
|
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Purchase of property and equipment
|
|
- |
|
|
- |
|
|
(6,046) |
| |
|
|
|
|
|
|
|
|
|
Net Cash Used in Investing Activities
|
|
- |
|
|
- |
|
|
(6,046) |
| |
|
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Loans from shareholder
|
|
1,000 |
|
|
11,500 |
|
|
12,500 |
|
Proceeds from common stock issued
|
|
- |
|
|
- |
|
|
27,200 |
| |
|
|
|
|
|
|
|
|
|
Net Cash Provided by Financing Activities
|
|
1,000 |
|
|
11,500 |
|
|
39,700 |
| |
|
|
|
|
|
|
|
|
|
NET INCREASE (DECREASE) IN CASH
|
|
610 |
|
|
(3,088) |
|
|
892 |
| |
|
|
|
|
|
|
|
|
|
CASH AT BEGINNING OF PERIOD
|
|
282 |
|
|
3,370 |
|
|
- |
| |
|
|
|
|
|
|
|
|
|
CASH AT END OF PERIOD
|
$ |
892 |
|
$ |
282 |
|
$ |
892 |
| |
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
|
|
|
|
|
|
|
|
|
|
Cash paid for interest
|
$ |
- |
|
$ |
- |
|
$ |
- |
|
Cash paid for income taxes
|
$ |
- |
|
$ |
- |
|
$ |
- |
The accompanying notes are an integral part of these financial statements.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
OCTOBER 31, 2010
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Business
Jumpkicks, Inc. “the Company” was incorporated in the State of Delaware on August 3, 2007. The Company is engaged in retail sales of martial arts related equipment and services.
Development Stage Company
The accompanying financial statements have been prepared in accordance with generally accepted accounting principles related to development-stage companies. A development-stage company is one in which planned principal operations have not commenced or if its operations have commenced, there has been no significant revenues there from.
Basis of Presentation
The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.
Accounting Basis
The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting). The Company has adopted an October 31 fiscal year end.
Cash and Cash Equivalents
For purposes of the Statement of Cash Flows, the Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes.
The Company's bank accounts are deposited in insured institutions. The funds are insured up to $250,000. At October 31, 2010 and 2009 the Company's bank deposits did not exceed the insured amounts.
Fair Value of Financial Instruments
The Company’s financial instruments consist of cash and cash equivalents, accrued expenses and shareholder loans. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.
Use of 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 the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
JUMPKICKS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
OCTOBER 31, 2010
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Revenue Recognition
The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.
Basic Income (Loss) Per Share
Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of October 31, 2010.
Stock-Based Compensation
Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.
Dividends
The Company has not adopted any policy regarding payment of dividends. No dividends have been paid during any of the periods shown.
Income Taxes
The Company provides for income taxes using an asset and liability approach. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse. The Company’s predecessor operated as entity exempt from Federal and State income taxes.
Deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.
Advertising Costs
The Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred advertising expense of $-0- during the years ended October 31, 2010 and 2009.
Recent Accounting Pronouncements
Jumpkicks does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s results of operations, financial position or cash flow.
JUMPKICKS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
OCTOBER 31, 2010
NOTE 2 – GOING CONCERN
The accompanying financial statements have been prepared in conformity with generally accepted accounting principle, which contemplate continuation of the Company as a going concern. However, the Company has accumulated deficit of $102,056 as of October 31, 2010. The Company currently has negative liquidity, and has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time which raises substantial doubt about its ability to continue as a going concern.
Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses The Company plans to position itself so that it may be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.
NOTE 3 – PROPERTY AND EQUIPMENT
The Company purchased property and equipment totaling $6,046 during the period ended October 31, 2007. The equipment is being depreciated over 5 years. Depreciation expense was $1,212 for the years ended October 31, 2010 and 2009, respectively.
| |
2010
|
|
2009
|
|
Office equipment
|
$ |
431 |
|
$ |
431 |
|
Computer equipment
|
|
5,615 |
|
|
5,615 |
|
Accumulated depreciation
|
|
(3,737) |
|
|
(2,525) |
|
Property and equipment, net
|
$ |
2,309 |
|
$ |
3,521 |
NOTE 4 – ACCRUED EXPENSES
Accrued expenses consisted of the following as of October 31, 2010 and 2009:
| |
2010
|
|
2009
|
|
Accrued accounting
|
$ |
3,895 |
|
$ |
3,795 |
|
Accrued legal
|
|
61,662 |
|
|
4,951 |
|
Accrued regulatory
|
|
0 |
|
|
0 |
|
Total Accrued Expenses
|
$ |
65,557 |
|
$ |
8,746 |
NOTE 5 – SHAREHOLDER LOAN
During the years ended October 31, 2010 and 2009, a shareholder of the Company loaned $1,000 and $11,500 to the Company to cover certain operating expenses and fund the bank account. The loans are unsecured, interest free and due on demand. The total due to the shareholder was $12,500 as of October 31, 2010.
JUMPKICKS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
OCTOBER 31, 2010
NOTE 6 – COMMON STOCK
During 2007, the Company received $10,000 from its founders for 10,000,000 shares of its common stock. The Company also received $17,200 in a private placement of its shares at $0.02 per share for 860,000 shares.
The Company did not issue any additional stock during the years ended October 31, 2010 and 2009
There were 10,860,000 shares of common stock issued and outstanding as of October 31, 2010 and 2009.
NOTE 7 – INCOME TAXES
As of October 31, 2010, the Company had net operating loss carry forwards of approximately $102,000 that may be available to reduce future years’ taxable income through 2030. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.
The provision for Federal income tax consists of the following at October 31, 2010 and 2009:
| |
2010
|
|
2009
|
|
Federal income tax attributable to:
|
|
|
|
|
Current Operations
|
$ |
19,911 |
|
$ |
5,729 |
|
Less: valuation allowance
|
|
(19,911) |
|
|
(5,729) |
|
Net provision for Federal income taxes
|
$ |
- |
|
$ |
- |
The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows at October 31, 2010 and 2009:
| |
2010
|
|
2009
|
|
Deferred tax asset attributable to:
|
|
|
|
|
Net operating loss carryover
|
$ |
34,699 |
|
$ |
14,788 |
|
Less: valuation allowance
|
|
(34,699) |
|
|
(14,788) |
|
Net deferred tax asset
|
$ |
- |
|
$ |
- |
Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of $102,056 for federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur net operating loss carry forwards may be limited as to use in future years.
JUMPKICKS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
OCTOBER 31, 2010
NOTE 8 – COMMITMENTS
The Company neither owns nor leases any real or personal property. An officer has provided office services without charge. There is no obligation for the officer to continue this arrangement. Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future.
NOTE 9 – SUBSEQUENT EVENTS
Management has evaluated subsequent events through January 26, 2011, the date these financial statements were issued, and has determined it does not have any material subsequent events to disclose.
Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
On August 6, 2009, Moore & Associates Chartered (the “Former Accountant”) resigned as the Company’s accountant.
The Former Accountant’s audit reports on the financial statements of the Company for the past two years, including for the fiscal year ended October 31, 2008, and for the period ended October 31, 2007, contained no adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles, except that the audit reports on the financial statements of the Company for the fiscal year ended October 31, 2008, and for the period ended October 31, 2007, contained an uncertainty about the Company’s ability to continue as a going concern.
During the two most recent fiscal years and any subsequent interim period through the date of resignation, including the period ended October 31, 2007, the year ended October 31, 2008, and through the interim periods ended January 31, 2009, April 30, 2009, and August 6, 2009 , there were no “disagreements” (as such term is defined in Item 304 of Regulation S-K) with the Former Accountant on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements if not resolved to the satisfaction of the Former Accountant would have caused them to make reference thereto in their reports on the financial statements for such periods.
During the two most recent fiscal years and any subsequent interim period through the date of resignation, including the period ended October 31, 2007, the year ended October 31, 2008, and through the interim periods ended January 31, 2009, April 30, 2009, and August 6, 2009, there were no “reportable events” (as such term is defined in Item 304 of Regulation S-K).
On September 15, 2009, the Company provided the Former Accountant with its disclosures in a Current Report on Form 8-K/A disclosing the resignation of the Former Accountant and requested in writing that the Former Accountant furnish the Company with a letter addressed to the Securities and Exchange Commission stating whether or not they agree with such disclosures. The Former Accountant’s response was filed as an exhibit to the Current Report on Form 8 -K/A, dated September 18, 2009.
On September 13, 2009, the company’s board of directors appointed Maddox Ungar Silberstein, PLLC, currently known as Silberstein Ungar, PLLC, as the company’s auditor and independent accountant.
During the registrant's two most recent fiscal years, and the subsequent interim periods prior to engaging Maddox Ungar Silberstein, PLLC, including the period ended October 31, 2007, the year ended October 31, 2008, and through the interim periods ended January 31, 2009, April 30, 2009, and August 6, 2009, the company did not consult Maddox Ungar Silberstein, PLLC regarding either the application of accounting principles to a specified transaction, either completed or proposed; or the type of audit opinion that might be rendered on the company's financial statements, or any matter that was either the subject of a disagreement or a reportable event.
The registrant has requested that Moore and Associates, Chartered furnish it with an additional letter addressed to the Securities and Exchange Commission stating whether it agrees with the above statements. Moore and Associates informed the registrant that, upon the advice of counsel, Moore and Associates would not be providing an additional letter in connection with this Amended Current Report.
No other events occurred requiring disclosure under Item 304(b) of Regulation S-K during the fiscal years ending October 31, 2010 or October 31, 2009.
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
As required by Rule 13a-15(b) under the Securities Exchange Act of 1934 (the “1934 Act”), as of October 31, 2010, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) or Rule 15d-15(e) under the Exchange Act). This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer (our principal executive officer) and our Chief Financial Officer (our principal financial officer), who concluded, that because of the material weakness in our internal control over financial reporting described below, our disclosure controls and procedures were not effective as of October 31, 2010.
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.
Management’s Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. This rule defines internal control over financial reporting as a process designed by, or under the supervision of, the Company’s Chief Executive Officer and Chief Financial Officer, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP. Our internal control over financial reporting includes those policies and procedures that:
| |
•
|
|
Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect our transactions and dispositions;
|
| |
•
|
|
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of management and directors of the Company; and
|
| |
•
|
|
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements.
|
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
With the participation of the Chief Executive Officer and the Chief Financial Officer, our management conducted an evaluation of the effectiveness of our internal control over financial reporting. Based on this evaluation, our management has concluded that our internal control over financial reporting was not effective as of October 31, 2010, as the result of a material weakness. The material weakness results from significant deficiencies in internal control that collectively constitute a material weakness.
A significant deficiency is a deficiency, or combination of deficiencies, in internal control over financial reporting that is less severe than a material weakness, yet important enough to merit attention by those responsible for oversight of the registrant’s financial reporting. We had the following significant deficiencies at October 31, 2010:
|
|
We have only one employee to oversee bank reconciliations, posting payables, and so forth, so there are no checks and balances on internal controls.
|
This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to an exemption for non-accelerated filers set forth in Section 989G of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Remediation of Material Weakness
We are unable to remedy the material weakness in our internal controls until we are able to hire additional employees, so that we may then introduce checks and balances on internal controls.
Limitations on the Effectiveness of Internal Controls
Our management, including our Chief Executive Officer and our Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal control over financial reporting are or will be capable of preventing or detecting all errors or all fraud. Any control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements, due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns may occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risk.
This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report.
During the most recently completed fiscal quarter, there has been no change in our internal control over financial reporting that has materially affected or is reasonably likely to materially affect, our internal control over financial reporting.
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The following information sets forth the name of our sole executive officer and directors, his age as of October 31, 2010 and his present position.
|
Name
|
Age
|
Position Held with the Company
|
|
Richard Douglas
632 Marsh Creek Court
Henderson, NV 89002
|
44
|
President, Secretary, CEO, CFO, Director
|
Set forth below is a brief description of the background and business experience of our sole executive officer and director.
Richard Douglas is our sole officer and director Mr. Douglas has been involved in martial arts for over thirty years as both a student and instructor. He has held the rank of Black Belt in three different national martial arts governing bodies: the United Fighting Arts Federation; the National Tang Soo Do Congress; and the Western Tang Soo Do Federation.
Mr. Douglas holds a Bachelor of Science degree in accounting and graduated in 2004 from the University of Nevada Las Vegas with a Masters of Accountancy Degree with an emphasis in tax. He is licensed to practice in Nevada as a Certified Public Accountant. From 2000 to 2004, Mr. Douglas worked in the hotel services industry, focusing on guest services. From 2004 through the end of 2010, Mr. Douglas worked as a tax associate at a large public accounting firm, where he performed bookkeeping services and prepared individual, partnership and corporate tax returns. As an auditing senior associate, he planned and performed compilation, review and auditing services for a variety of not-for-profit entities, large governmental entities, small and large hotels and casinos, and construction companies. As an accountant, Mr. Douglas has specialized in assurance services, focusing on internal audit functions, audits and compliance services, and brings that experience and perspective to Jumpkicks. Beginning in 2011, Mr. Douglas co-founded an accounting firm Barlow Douglas. He is and will be performing the same auditing and accounting services he performed at his prior firm.
Directors
Our bylaws authorize no less than one (1) and more than ten (10) directors. We currently have one Director.
Term of Office
Our Directors are appointed for a one-year term to hold office until the next annual general meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board.
Family Relationships
There are no family relationships between or among the directors, executive officers or persons nominated or chosen by us to become directors or executive officers.
Involvement in Certain Legal Proceedings
To the best of our knowledge, during the past five years, none of the following occurred with respect to a present or former director, executive officer, or employee: (1) any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; (2) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his or her involvement in any type of business, securities or banking activities; and (4) being found by a court of competent jurisdiction (in a civil action), the SEC or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.
Audit Committee
We do not have a separately-designated standing audit committee. The entire Board of Directors performs the functions of an audit committee, but no written charter governs the actions of the Board when performing the functions of what would generally be performed by an audit committee. The Board approves the selection of our independent accountants and meets and interacts with the independent accountants to discuss issues related to financial reporting. In addition, the board of directors reviews the scope and results of the audit with the independent accountants, reviews with management and the independent accountants our annual operating results, considers the adequacy of our internal accounting procedures and considers other auditing and accounting matters including fees to be paid to the independent auditor and the performance of the independent auditor.
We do not have an audit committee financial expert because of the size of our company and our board of directors at this time. We believe that we do not require an audit committee financial expert at this time because we retain outside consultants who possess these attributes.
For the fiscal year ending October 31, 2010, the board of directors:
|
1.
|
Reviewed and discussed the audited financial statements with management, and
|
|
2.
|
Reviewed and discussed the written disclosures and the letter from our independent auditors on the matters relating to the auditor's independence.
|
Based upon the board of directors’ review and discussion of the matters above, the board of directors authorized inclusion of the audited financial statements for the year ended October 31, 2010, to be included in this Annual Report on Form 10-K and filed with the Securities and Exchange Commission.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our directors and executive officers and persons who beneficially own more than ten percent of a registered class of the Company’s equity securities to file with the SEC initial reports of ownership and reports of changes in ownership of common stock and other equity securities of the Company. Officers, directors and greater than ten percent beneficial shareholders are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. To the best of our knowledge based solely on a review of Forms 3, 4, and 5 (and any amendments thereof) received by us during or with respect to the year ended October 31, 2006, the following persons have failed to file, on a timely basis, the identified reports required by Section 16(a) of the Exchange Act during fiscal year ended October 31, 2010:
|
Name and principal position
|
Number of
late reports
|
Transactions not
timely reported
|
Known failures to
file a required form
|
|
Richard Douglas
|
0
|
0
|
0
|
Code of Ethics
As of October 31, 2010, we had not adopted a Code of Ethics for Financial Executives, which would include our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions.
Item 11. Executive Compensation
Summary Compensation Table
The table below summarizes all compensation awarded to, earned by, or paid to both to our officers and to our directors for all services rendered in all capacities to us for our fiscal years ended October 31, 2010 and 2009.
|
SUMMARY COMPENSATION TABLE
|
|
Name and
principal position
|
Year
|
Salary ($)
|
Bonus
($)
|
Stock
Awards
($)
|
Option
Awards
($)
|
Non-Equity
Incentive Plan
Compensation
($)
|
Nonqualified
Deferred
Compensation
Earnings ($)
|
All Other
Compensation
($)
|
Total
($)
|
|
Richard Douglas,President, Chief Executive Officer, Principal Executive Officer,
Chief Financial Officer, Principal Financial Officer, Principal Accounting Officer and Director
|
2010
2009
|
0
0
|
0
0
|
0
0
|
0
0
|
0
0
|
0
0
|
0
0
|
0
0
|
Narrative Disclosure to the Summary Compensation Table
We have not entered into any employment agreement or consulting agreement with our executive officer. There are no arrangements or plans in which we provide pension, retirement or similar benefits for executive officers.
Although we do not currently compensate our officer, we reserve the right to provide compensation at some time in the future. Our decision to compensate officers depends on the availability of our cash resources with respect to the need for cash to further our business purposes.
Outstanding Equity Awards at Fiscal Year-End
The table below summarizes all unexercised options, stock that has not vested, and equity incentive plan awards for each named executive officer as of October 31, 2010.
|
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
|
|
OPTION AWARDS
|
STOCK AWARDS
|
|
Name
|
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
|
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
|
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
Number
of
Shares
or Units
of
Stock That
Have
Not
Vested
(#)
|
Market
Value
of
Shares
or
Units
of
Stock
That
Have
Not
Vested
($)
|
Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units or
Other
Rights
That Have
Not
Vested
(#)
|
Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested
(#)
|
|
Richard Douglas
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Stock Option Grants
We have not granted any stock options to the executive officers or directors since our inception.
Director Compensation
The table below summarizes all compensation awarded to, earned by, or paid to our director for all services rendered in all capacities to us for the period from inception (August 3, 2007) through October 31, 2010.
|
DIRECTOR COMPENSATION
|
|
Name
|
Fees Earned or
Paid in
Cash
($)
|
Stock Awards
($)
|
Option Awards
($)
|
Non-Equity
Incentive
Plan
Compensation
($)
|
Non-Qualified
Deferred
Compensation
Earnings
($)
|
All
Other
Compensation
($)
|
Total
($)
|
|
Richard Douglas
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Narrative Disclosure to the Director Compensation Table
We do not pay any compensation to our directors at this time. However, we reserve the right to compensate our directors in the future with cash, stock, options, or some combination of the above.
We have not reimbursed our directors for expenses incurred in connection with attending board meetings nor have we paid any directors fees or other cash compensation for services rendered as a director in the year ended October 31, 2010.
We have no formal plan for compensating our directors for their services in their capacity as directors. In the future we may grant options to our directors to purchase shares of common stock as determined by our Board of Directors or a compensation committee that may be established. We do have a stock option plan in place at this time although we have not yet issued any options. Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our board of directors. The board of directors may award special remuneration to any director undertaking any special services on behalf of Jumpkicks other than services ordinarily required of a director. No director received and/or accrued any compensation for his or her services as a director, including committee participation and/or special assignments
Stock Option Plans
We did not have a stock option plan as of October 31, 2010.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following table sets forth certain information known to us with respect to the beneficial ownership of our Common Stock as of October 31, 2010, by (1) all persons who are beneficial owners of 5% or more of our voting securities, (2) each director, (3) each executive officer, and (4) all directors and executive officers as a group. The information regarding beneficial ownership of our common stock has been presented in accordance with the rules of the Securities and Exchange Commission. Under these rules, a person may be deemed to beneficially own any shares of capital stock as to which such person, directly or indirectly, has or shares voting power or investment power, and to beneficially own any shares of our capital stock as to which such person has the right to acquire voting or investment power within 60 days through the exercise of any stock option or other right. The percentage of beneficial ownership as to any person as of a particular date is calculated by dividing (a) (i) the number of shares beneficially owned by such person plus (ii) the number of shares as to which such person has the right to acquire voting or investment power within 60 days by (b) the total number of shares outstanding as of such date, plus any shares that such person has the right to acquire from us within 60 days. Including those shares in the tables does not, however, constitute an admission that the named stockholder is a direct or indirect beneficial owner of those shares. Unless otherwise indicated, each person or entity named in the table has sole voting power and investment power (or shares that power with that person’s spouse) with respect to all shares of capital stock listed as owned by that person or entity.
Except as otherwise indicated, all Shares are owned directly and the percentage shown is based on 10,860,000 Shares of Common Stock issued and outstanding as of October 31, 2010.
|
Name and Address of Beneficial Owners of Common Stock1
|
Title of Class
|
Amount and Nature of Beneficial Ownership
|
% of Common Stock2
|
|
Richard Douglas
632 Marsh Creek Court
Henderson, NV 89002
|
Common Stock
|
10,000,000
|
92.08%
|
|
DIRECTORS AND OFFICERS – TOTAL
|
|
10,000,000
|
92.08%
|
| |
|
|
|
|
5% SHAREHOLDERS
|
|
|
|
|
None
|
Common Stock
|
NONE
|
NONE
|
Other than the shareholders listed above, we know of no other person who is the beneficial owner of more than five percent (5%) of our common stock.
Item 13. Certain Relationships and Related Transactions, and Director Independence
None of our directors or executive officers, nor any proposed nominee for election as a director, nor any person who beneficially owns, directly or indirectly, shares carrying more than 5% of the voting rights attached to all of our outstanding shares, nor any members of the immediate family (including spouse, parents, children, siblings, and in-laws) of any of the foregoing persons has any material interest, direct or indirect, in any transaction over the last two years or in any presently proposed transaction which, in either case, has or will materially affect us.
Item 14. Principal Accounting Fees and Services
Below is the table of Audit Fees (amounts in US$) billed by our auditor in connection with the audit of the Company’s annual financial statements for the years ended:
|
Financial Statements for the
Year Ended October 31
|
Audit Services
|
Audit Related Fees
|
Tax Fees
|
Other Fees
|
|
2010
|
$6,850
|
$0
|
$0
|
$0
|
|
2009
|
$7,000
|
$0
|
$0
|
$0
|
PART IV
Item 15. Exhibits, Financial Statements Schedules
|
(a)
|
Financial Statements and Schedules
|
The following financial statements and schedules listed below are included in this Form 10-K.
Financial Statements (See Item 8)
|
1
|
Incorporated by reference to the Registration Statement on Form SB-2 filed on January 29, 2008.
|
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Jumpkicks, Inc.
|
By:
|
/s/ Richard Douglas
|
| |
Richard Douglas
President, Chief Executive Officer, Principal Executive Officer,
Chief Financial Officer, Principal Financial Officer, Principal Accounting Officer and Director
|
| |
January 27, 2011
|
In accordance with Section 13 or 15(d) of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated:
|
By:
|
|
| |
Richard Douglas
President, Chief Executive Officer, Principal Executive Officer,
Chief Financial Officer, Principal Financial Officer, Principal Accounting Officer and Director
|
| |
January 27, 2011
|