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UBIQ > SEC Filings for UBIQ > Form 10-Q on 20-May-2013All Recent SEC Filings

Show all filings for UBIQUITY BROADCASTING CORP

Form 10-Q for UBIQUITY BROADCASTING CORP


20-May-2013

Quarterly Report


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

Cautionary Notice Regarding Forward Looking Statements

The information contained in Item 2 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Actual results may materially differ from those projected in the forward-looking statements as a result of certain risks and uncertainties set forth in this report. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this report.

This filing contains a number of forward-looking statements which reflect management's current views and expectations with respect to our business, strategies, products, future results and events, and financial performance. All statements made in this filing other than statements of historical fact, including statements addressing operating performance, events, or developments which management expects or anticipates will or may occur in the future, including statements related to distributor channels, volume growth, revenues, profitability, new products, adequacy of funds from operations, statements expressing general optimism about future operating results, and non-historical information, are forward looking statements. In particular, the words "believe," "expect," "intend," "anticipate," "estimate," "may," variations of such words, and similar expressions identify forward-looking statements, but are not the exclusive means of identifying such statements, and their absence does not mean that the statement is not forward-looking. These forward-looking statements are subject to certain risks and uncertainties, including those discussed below. Our actual results, performance or achievements could differ materially from historical results as well as those expressed in, anticipated, or implied by these forward-looking statements. We do not undertake any obligation to revise these forward-looking statements to reflect any future events or circumstances.

Readers should not place undue reliance on these forward-looking statements, which are based on management's current expectations and projections about future events, are not guarantees of future performance, are subject to risks, uncertainties and assumptions (including those described below), and apply only as of the date of this filing. Our actual results, performance or achievements could differ materially from the results expressed in, or implied by, these forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Overview

Ubiquity Broadcasting Corporation (the "Company," "We," or "Us"), f/k/a Fermo Group, Inc., was incorporated in the State of Nevada on December 2, 2011. We have not had any revenues, have minimal assets and have incurred losses since inception. We were original formed to place and operate donut making machines.

Change in Control

On February 21, 2013, we entered into a stock purchase agreement (the "Stock Purchase Agreement") with Ilia Sachin (the "Seller"), Christopher Carmichael and Brenden Garrison (the "Purchasers"), whereby the Purchasers purchased from the Seller, 3,000,000 shares of common stock, par value $0.001 per share, of the Company (the "Shares"), representing approximately 80.21% of the issued and outstanding shares of the Company, for an aggregate purchase price of $150,000. Christopher Carmichael purchased 2,866,667 Shares, and Brenden Garrison purchased 133,333 Shares. As a result, Christopher Carmichael and Brenden Garrison became the majority shareholders of the Company. Prior to the closing of the transactions contemplated by the Stock Purchase Agreement, the Seller was our President, Chief Executive Officer, Chief Financial Officer, sole director, and majority shareholder. Following the close of the transaction, the former business operations ceased.

Merger Agreement

On March 5, 2013, we entered into an Agreement and Plan of Merger (the "Merger Agreement") with Ubiquity Acquisition Corporation, a Nevada corporation and our wholly-owned subsidiary ("Ubiquity Acquisition"), and Ubiquity Broadcasting Corporation, a Delaware corporation ("Ubiquity").

Pursuant to the terms of the Merger Agreement, Ubiquity Acquisition will merge with and into Ubiquity in a statutory reverse triangular merger (the "Merger"), with Ubiquity surviving as a wholly-owned subsidiary of the Company upon satisfaction of certain conditions. At the closing of the Merger, we will issue Ubiquity shareholders one share of our common stock, par value $0.001 per share for each share of Ubiquity's common stock, par value $0.001. As a result of the Merger, we will become a multimedia company focused on the intersection of cloud-based cross platform applications synchronized across all screens for enhancing the digital lifestyle.

Conditions for the closing of the Merger include:

The Company shall have received an audit report of Ubiquity with respect to its two most recently completed fiscal years from an independent accounting firm that is registered with the Public Company Accounting Oversight Board; and

The Company shall have filed the Charter Amendment with the appropriate agency and effected the Share Increase (defined in Item 5.03), the Forward Split (defined in Item 8.01), and Name Change (defined in Item 5.03).

As of the date hereof, the closing conditions have not been satisfied. Accordingly, the Merger has not closed. Although we anticipate that the Proposed Transaction will be completed, there is no guarantee that the closing conditions will be satisfied, nor that the Proposed Transaction will be completed.

Results of Operations

Comparison for the three months ended March 31, 2013 and 2012

Net Revenue

Net revenue was $0 for the three months ended March 31, 2013 and $0 for the three months ended March 31, 2012 respectively.

Total Cost of Sales

Cost of sales was $0 for the three months ended March 31, 2013 and $0 for the three months ended March 31, 2012 respectively.

Gross profit

Gross profit was $0 for the three months ended March 31, 2013 and $0 for the three months ended March 31, 2012 respectively.

Net Loss

Net Loss was ($6,125) for the three months ended March 31, 2013, as compared to net loss of ($3,887) for the three months ended March 31, 2012. This increase of $2,234 or approximately 37.5% is attributed to the filing and accounting fees with the proposed merger.

Liquidity and Capital Resources

Cash requirements for, but not limited to, working capital, capital expenditures, and debt repayments have been funded from cash balances on hand, revolver borrowings, loans from officers, notes payable.

At March 31, 2013, we had cash and cash equivalents of $13 as compared to $75 as of December 31, 2012, representing a decrease of $62.

The cash flow used in operating activities decreased from ($6,887) for the quarter ended March 31, 2012 to ($2,362) for the quarter ended March 31, 2013.

The cash flow from financing activities decreased from net cash provided of $4,325 for the quarter ended March 31, 2012 to net cash used of $800 for the quarter ended March 31, 2013. This decrease is primarily attributed to the proposed merger agreement and change in control of ownership on in February 2013.

Going Concern

Our independent registered auditors included an explanatory paragraph in their opinion on our financial statements as of and for the fiscal year ended December 31, 2012 that states that our ongoing losses and lack of resources causes substantial doubt about our ability to continue as a going concern.

Recent Accounting Pronouncements

The Company 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 flows.

Critical Accounting Policies

Our significant accounting policies are presented in our notes to financial statements for the period ended March 31, 2013 and fiscal year ended December 31, 2012, which are contained in the Company's 2012 Annual Report on Form 10-K. The significant accounting policies that are most critical and aid in fully understanding and evaluating the reported financial results include the following:

The Company prepares its financial statements in conformity with GAAP. These principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management believes that these estimates are reasonable and have been discussed with our board of directors; however, actual results could differ from those estimates.

We issue restricted stock to consultants for various services. Cost for these transactions are measured at the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. The value of the common stock is measured at the earlier of (i) the date at which a firm commitment for performance by the counterparty to earn the equity instruments is reached or (ii) the date at which the counterparty's performance is complete.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

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