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MONT > SEC Filings for MONT > Form 10-Q/A on 8-Nov-2012All Recent SEC Filings

Show all filings for MONSTER OFFERS

Form 10-Q/A for MONSTER OFFERS


8-Nov-2012

Quarterly Report


Item 2. - Management's Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Information

The Company from time to time may make written or oral "forward-looking statements" including statements contained in this report and in other communications by the Company, which are made in good faith by the Company pursuant to the "safe harbor" provisions of the Private Securities Litigation

Reform Act of 1995.

These forward-looking statements include statements of the Company's plans, objectives, expectations, estimates and intentions, which are subject to change based on various important factors (some of which are beyond the Company's control). The following factors, in addition to others not listed, could cause the Company's actual results to differ materially from those expressed in forward looking statements: the strength of the domestic and local economies in which the Company conducts operations, the impact of current uncertainties in global economic conditions and the ongoing financial crisis affecting the domestic and foreign banking system and financial markets, including the impact on the Company's suppliers and customers, changes in client needs and consumer spending habits, the impact of competition and technological change on the Company, the Company's ability to manage its growth effectively, including its ability to successfully integrate any business which it might acquire, and currency fluctuations. All forward-looking statements in this report are based upon information available to the Company on the date of this report. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except

as required by law.

Critical Accounting Policies

There have been no material changes to our critical accounting policies and estimates from the information provided in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations", included in our Annual report on Form 10-K for the fiscal year ended December 31, 2011.

Results of Operations

Overview of Current Operations

Monster Offers ("the Company") was incorporated in the State of Nevada on February 23, 2007, under the name Tropical PC Acquisition Company. On December 11, 2007, the Company amended its Articles of Incorporation changing its name to Monster Offers. The Company was originally incorporated as a wholly owned subsidiary of Tropical PC, Inc., a Nevada corporation. Tropical PC was incorporated September 22, 2004. On December 11, 2007, the Company amended its Articles of Incorporation changing its name from Tropical PC Acquisition Corporation to Monster Offers.

Our Business

Monster Offers is a daily deal aggregator, collecting daily deals from multiple sites in local communities across the U.S. and Canada. Focused on providing innovation and utility for Daily Deal consumers and providers, the company collects and publishes thousands of daily deals and allows consumers to organize these deals by geography or product categories, or to personalize the results using keyword search.

We utilize proprietary technology that we have developed, acquired, and/or licensed to deploy our products and services.

Our primary services include the aggregation and promotion of Daily Deals to consumers via our primary website; www.monsteroffers.com which provides search capabilities for users to quickly find Daily Deals based on filtering algorithms, zip code, predictive text search by city, and by user preferences.

The Company earns fees from data reporting services, traffic generation, and from our affiliate partners via marketing services including the online promotion of its affiliate partners daily deals through its website www.monsteroffers.com, selling of industry data and analysis reports, and executing internet and social marketing campaigns for customers. Our affiliate program partners are also offered search result placement and other benefits including the ability to participate in early release or beta programs for new innovations that the Company offers.

Current and potential customers include media and content publishers, advertisers, direct marketers, and advertising agencies seeking to increase brand impressions, sales, and customer contact through online marketing initiatives. Our customers also utilize our products and services to analyze the competitive landscape within their target markets. All transactional services revenues are recognized on a gross basis.

Marketing Strategy

The Monster Offers website generates page views from consumers searching the Internet for Daily Deals and other relevant information. As users search through the various deals that are presented via the website, they click on specific partner deals for additional information and are directed to our partner websites whereby they can purchase an advertised deal or offer directly. In these instances, the information about the user and the Monster Offers referral to a partner website is tracked and the affiliate partner then pays Monster Offers a fee, typically a percentage of the total transaction that occurs on the partner website. Monster Offers also earns fees from other content providers and advertisers based on the volume of traffic the Monster Offers site generates and the number of times content is displayed to potential consumers.

Monster Offers has also recently entered the mobile money payment market via a strategic alliance and exclusive license to technology developed by SSL5. Monster Offers plans to add significant ease-of-use functionality for the consumer to its website and to expand its affiliate partner network further leveraging this new technology in 2012.

Email Marketing

Websites that we own or are digitally produced for clients are promoted by the engagement of opt-in email marketing companies. In other words, opt-in emails are sent to users who have requested to receive marketing messages from a particular email partner/website. These partners currently market to multiple consumer and/or business databases that they own or are managed by them under a list management agreement.

Search Engine Marketing

We utilize search engine marketing companies to direct consumers to websites. Funds are placed in an open account with each provider and are spent on a Cost-Per-Click auction basis. Google, Yahoo, and FaceBook are the primary providers of this service.

Affiliate Marketing

We engage affiliate network destinations where online affiliates can promote various client offers and promotions through Daily Deal applications. These traffic publishers choose, manage, and execute marketing cost per action client campaigns. They are also provided with real-time commission tracking.

Software Development

We utilize the services of outsourced contractors for the development of our software technology. We also utilize the services of technology consultants to assist in the development of our strategic product development roadmap, and the ongoing management of all software development outsourced contractors. As the Company continues to grow, we may hire direct employees to fill various technology management, development, testing and quality control roles as needed.

Competition

The Daily Deal advertising and marketing industry is highly competitive. Management believes that the ability to provide innovative consumer and business solutions that fulfill unmet industry needs is a competitive advantage.

A number of companies are active in specific aspects of our business. As a Daily Deal provider, Monster Offers would face competition from a growing list of other Daily Deal providers including Groupon, Living Social, Travelzoo, and literally hundreds of smaller start-up companies who continue to emerge in the Daily Deal market. These companies all aim to offer online "Daily Deals" directly to the consumer. Rather than compete with all of these companies, the Monster Offers business model is to "aggregate" the Daily Deals that are offered by these companies into a single website making it easier and more convenient for the consumer to search and purchase the deals that they seek.

As a Daily Deal aggregator, Monster Offers does face a growing number of other companies with a similar aggregation model including Yipit, thedealmap, 8coupons, and others. Monster Offers plans to leverage its latest innovations in mobile banking and money sharing technology with prospective competitors to turn competitors into partners, therefore reducing any substantial direct competition in the Daily Deal industry.

Iconosys

On May 16, 2011, the Company entered into a Strategic Alliance and License Agreement with Iconosys, Inc., a California corporation. Iconosys has developed proprietary mobile applications and technology and engaged in the business of mobile communication application design related services. Monster Offers and Iconosys formed a strategic alliance with respect to the integration, use and commercialization of Monster Offers and Iconosys existing Intellectual Property to create new and derivative intellectual property to introduce to various markets.

Results of Operations for the quarters ended June 30, 2012 and 2011

Revenues

During the three month period ended June 30, 2012, the Company generated $25,918 in revenues as compared to $34,989 for the same period last year. During the six month period ended June 30, 2012, the Company generated $72,418 in revenues as compared to $45,612 for the same period last year. Management does not expect to receive any significant related party revenues through the end of its fiscal year. There can be no assurances that the Company can be profitable or that the Company will not incur operating losses in the future.

Our overall revenues were up over the previous year due to increased customer acct activities. However, the decrease in the second quarter was due to the added customer contracts only being short-term contracts. Another way of saying this is:

Short-term customer contracts accounted for an overall increase in revenue to date.

For the three months ending June 30, 2012, the Company experienced general and administrative expenses of $154,882 as compared to general and administrative expenses of $24,637 for the same period last year. For the three months ending June 30, 2012, the Company expensed advertising fees of $0 as compared to $2,614 in advertising fees for the same period last year. For the three months ending June 30, 2012, the Company expensed consulting compensation of $104,687 as compared to $112,405 in consulting compensation for the same period last year. For the three months ending June 30, 2012, the Company expensed audit fees of $10,950 as compared to $3,500 in audit fees for the same period last year. For the three months ending June 30, 2012, the Company expensed officer compensation of $9,106 as compared to $34,200 in officer compensation for the same period last year. Total operating expenses for the quarter ending June 30, 2012 were $284,062 versus $201,197 for the same period last year.

For the six months ending June 30, 2012, the Company experienced general and administrative expenses of $162,272 as compared to general and administrative expenses of $59,268 for the same period last year. For the six months ending June 30, 2012, the Company expensed consulting compensation of $113,870 as compared to $209,722 in consulting compensation for the same period last year. For the six months ending June 30, 2012, the Company expensed audit fees of $15,450 as compared to $17,330 in audit fees for the same period last year. For the six months ending June 30, 2012, the Company expensed officer compensation of $19,656 as compared to $69,700 in officer compensation for the same period last year. Total operating expenses for the six months ending June 30, 2012 were $320,518 versus $395,580 for the same period last year. Operating expenses decrease due to reductions in general and administrative fees and reduced outside consulting fees.

For the three months ended June 30, 2012, the Company had $(2,832,302) in net losses or $(1.28) per share as compared to a net loss of $(214,731) or $(0.00) for the same period last year. For the six months ended June 30, 2012, the Company had $(2,841,703) in net losses or $(2.34) per share as compared to a net loss of $(425,049) or $(0.01) for the same period last year.

Since the Company's inception, on February 23, 2007, the Company had a net loss of $(4,374,184).

Plan of Operation

Management does not believe that the Company will be able to generate any significant profit during the coming year. Management believes that general and administrative costs as well as building its infrastructure will most likely curtail any significant profits.

Notwithstanding, the Company anticipates it will continue to generate losses and therefore it may be unable to continue operations in the future. Originally, management anticipated a need to raise $475,000 to fully implement its business plan. After careful consideration and a detailed analysis by new management, the Company now expects it will need to raise $5,000,000 to forward its business plan, and Monster Offers would have to issue debt or equity or enter into a strategic arrangement with a third party. There can be no assurance that additional capital will be available to Monster Offers, especially with the current economic environment.

Based on current cash on hand of $260 as of June 30, 2012, current assets of $263,352 and $126,433 in current liabilities, management is concerned that Monster Offers may not have sufficient funds to meet its financial obligations for the next twelve months. Management believes it has sufficient cash reserves to keep the Company operational through the fourth quarter. Management will need to obtain outside funding to keep the Company operational beyond the third quarter. There are no assurances that management will be able to secure outside funding. Management anticipates that the Company will need to spend a minimum of $15,000 over the next twelve months to pay for audit and legal fees to keep the company fully reporting. Failure to secure additional funding can result in the company being fully reporting, but not operational. The Company will require additional funds to build its business infrastructure. In the event the Company requires additional funds, the Company will have to seek loans or equity placements to cover such cash needs. There are no assurances additional capital will be available to the Company on acceptable terms.

If the Company falls short of capital to keep the Company fully reporting, our officers/directors have agreed to donate funds to the operations of the Company, in order to keep it fully reporting for the next twelve (12) months. No agreement exists that our officers/directors will continue to donate funds to the operations of the Company for the next twelve months; therefore, there is no guarantee that they will continue to do so in the future.

Going Concern

Going Concern - The Company has recognized an accumulated deficit since inception (February 23, 2007) through June 30, 2012 of $4,374,184. Although the Company has recognized total revenues of $695,918 with gross profits of $446,090, since inception (February 23, 2007) through June 30, 2012, the Company's ability to continue as a going concern is contingent upon the successful completion of additional financing arrangements and its ability to achieve and maintain profitable operations. The financial statements have been prepared assuming the Company will continue to operate as a going concern which contemplates the realization of assets and the settlement of liabilities in the normal course of business. No adjustment has been made to the recorded amount of assets or the recorded amount or classification of liabilities which would be required if the Company were unable to continue its operations. (See Financial Footnote 2)

Summary of any product research and development that we will perform for the term of our plan of operation.

We do not anticipate performing any additional significant product research and development under our current plan of operation.

Expected purchase or sale of plant and significant equipment

We do not anticipate the purchase or sale of any plant or significant equipment; as such items are not required by us at this time.

Significant changes in the number of employees

As of June 30, 2012, we did not have any employees. We are dependent upon our officers and directors for our future business development. As our operations expand we anticipate the need to hire additional employees, consultants and professionals; however, the exact number is not quantifiable

at this time.

Liquidity and Capital Resources

The Company has limited financial resources available, which has had an adverse impact on the Company's liquidity, activities and operations. These limitations have adversely affected the Company's ability to obtain certain projects and pursue additional business. Without realization of additional capital, it would be unlikely for the Company to continue as a going concern. In order for the Company to remain a Going Concern it will need to find additional capital. Additional working capital may be sought through additional debt or equity private placements, additional notes payable to banks or related parties (officers, directors or stockholders), or from other available funding sources at market rates of interest, or a combination of these. The ability to raise necessary financing will depend on many factors, including the nature and prospects of any business to be acquired and the economic and market conditions prevailing at the time financing is sought. No assurances can be given that any necessary financing can be obtained on terms favorable to the Company, or at all.

As of June 30, 2012, our current assets were $263,352 and our current liabilities were $126,433. As of June 30, 2012, our total assets were $363,352 compared to total assets of $141,933 as of December 31, 2011. Total assets as of June 30, 2012 consisted of $260 in cash, $5,673 in accounts receivable, prepaid expense of $257,419, and $100,000 in Iconosys as an investment. As of June 30, 2012, our liabilities consisted of $45,978 in accounts payable, $5,041 in accrued interest, $13,250 in notes payable, $497 in bank overdrafts and $61,667 in convertible notes payable.

Stockholders' equity (deficit) decreased from $(135,300) as of December 31, 2011 to $236,919 as of June 30, 2012.

We have not generated positive cash flows from operating activities. For the six months ended June 30, 2012, net cash flow used in operating activities was $(17,304) compared to net cash flow used in operating activities of $(157,507) for the six months ended June 30, 2011. The difference came from a net loss of $(2,841,703) as of June 30, 2012 as compared to a net loss of $(425,049) as of June 30, 2011.

During the six month periods ended June 30, 2012 and June 30, 2011, net cash flow provided from financing activities was $13,747 and $152,500, respectively.

The Company has no employment agreements in place with its officers, nor does the Company owe its officers any accrued compensation.

Off-Balance Sheet Arrangements

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

Critical Accounting Policies and Estimates

Revenue Recognition: We recognize revenue from product sales and service agreements once all of the following criteria for revenue recognition have been met: pervasive evidence that an agreement exists; the services have been rendered; the fee is fixed and determinable and not subject to refund or adjustment; and collection of the amount due is reasonably assured.

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