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RCGP > SEC Filings for RCGP > Form 10-Q on 20-Oct-2014All Recent SEC Filings

Show all filings for RADIANT CREATIONS GROUP, INC.

Form 10-Q for RADIANT CREATIONS GROUP, INC.


20-Oct-2014

Quarterly Report


ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operation

Cautionary Statement Regarding Forward-Looking Statements

Certain statements contained in this Quarterly Report constitute "forward-looking statements." These statements, identified by words such as "plan," "anticipate," "believe," "estimate," "should," "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. These statements reflect the current views of management with respect to future events and are subject to risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from those described in the forward-looking statements. Such risks and uncertainties include those set forth under the caption "Part II - Item 1A. Risk Factors" and elsewhere in this Quarterly Report. We do not intend to update the forward-looking information to reflect actual results or changes in the factors affecting such forward-looking information. We advise you to carefully review the reports and documents, particularly our Annual Reports, Quarterly Reports and our Current Reports we file from time to time with the Securities and Exchange Commission (the "SEC").

As used in this Quarterly Report, the terms "we," "us," "our," "Radiant," and the "Company" refer to The Radiant Creations Group, Inc. unless otherwise indicated. All dollar amounts in this Quarterly Report are expressed in U.S. dollars, unless otherwise indicated.

Introduction

Effective May 21, 2012, a change of control took place and Clarent Services Corp. acquired from Half Moon Bay Holdings, LLC, 25,000,000 shares of common stock of the Company, representing all of Half Moon Bay's holdings of the Company. The shares constituted approximately 83.33% of the thirty million (30,000,000) issued and outstanding shares of common stock of the Company. There are no arrangements or understandings among members of the former and new control groups and their associates with respect to election of directors or other matters.

Recent Corporate Developments

On June 20, 2013, a change of control of the Company occurred when Biodynamic Molecular Technologies, LLC a privately held company organized in the State of Florida acquired from Clarent Services Corp., the former majority stockholder of the Company, in a private transaction, 25,000,000 restricted shares of common stock, par value $0.00001 per share of the Company.

The Company is not aware of any arrangements, including any pledge of securities of the Company, the operation of which may at a subsequent date result in a change of control of the Company.

Involvement in Certain Legal Proceedings

During the past five years no director or executive officer of the company (i) has been involved as a general partner or executive officer of any business which has filed a bankruptcy petition; (ii) has been convicted in any criminal proceeding nor is subject to any pending criminal proceeding; (iii) has been subjected to any order, judgment or decree of any court permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and (iv) has been found by a court, the Commission or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law.

Family Relationships

Mr. Gary R. Smith, our CEO, directly owns fifty percent, Mr. Gary D. Alexander, our CFO, owns twenty five percent, Mr. Michael S. Alexander, our EVP, owns twenty five percent and Mr. Manpreet Singh Thaper has no direct or indirect financial interest in Biodynamic Molecular Technologies, LLC the majority shareholder of the Company.

Plan of Operation

On June 20, 2013, following a change of control and subsequent acquisition of an exclusive license agreement, certain assets and processes to innovative technologies in skin protection and enhancement, which consist of various proprietary products including an anti-aging and revitalizing skin cream generally under the "Radiant Creations" label, the Company changed its principal business to the development and marketing of unique and proprietary scientific technologies and cosmetic and over-the-counter personal enhancement products and devices.

As of August 31, 2014, we had cash assets of $4,756 and a working capital deficit of $682,170 and an accumulated deficit of $7,279,830. As such, we anticipate that we will require substantial financing in the near future in order to meet our current obligations and to continue our operations. In addition, in the event that we are successful in identifying suitable alternative business opportunities, of which there is no assurance, we anticipate that we will need to obtain additional financing in order to pursue those opportunities.

Currently, we do not have any financing arrangements in place and there are no assurances that we will be able to obtain sufficient financing on terms acceptable to us, if at all. Due to the lack of our operating history and our present inability to generate significant revenues, our auditors have stated in their audit report included in our audited financial statements for the year ended February 28, 2014 that there currently exists substantial doubt about our ability to continue as a going concern.

Off-Balance Sheet Arrangements

None.

Financing Requirements

From December 29, 2005 (Inception) to August 31, 2014, we have suffered cumulative losses of $7,279,830. We expect to continue to incur substantial losses as we continue the growth of our business. Since our inception, we have funded operations through common stock issuances, related party loans, and the support of creditors in order to meet our strategic objectives.

Our management believes that sufficient funding will be available to meet our business objectives, including anticipated cash needs for working capital, and are currently evaluating several financing options, including a public offering of securities. However, we do not have any financing arrangements currently in place and there can be no assurance that we will be able to obtain sufficient financing when needed. As a result of the foregoing, our independent auditors believe there exists substantial doubt about our ability to continue as a going concern.

There is no assurance that we will be able to obtain additional financing if and when required. We anticipate that additional financing may come in the form of sales of additional shares of our common stock which may result in dilution to our current shareholders.

Going Concern Qualification

Several conditions and events cast substantial doubt about the Company's ability to continue as a going concern. The Company has a working capital deficit of $682,170 and has incurred net losses of $7,279,830 for the period from December 29, 2005 (inception) to August 31, 2014 and the Company will require additional financing in order to finance its business activities on an ongoing basis. The Company's future capital requirements will depend on numerous factors including, but not limited to, executing the company's marketing and business plans and the pursuit of other business opportunities. The Company is actively pursuing alternative financing and has had discussions with various third parties, although no firm commitments have been obtained. In the interim, shareholders of the Company have committed to meeting its operating expenses. Management believes that actions presently being taken to revise the Company's operating and financial requirements provide them with the opportunity to continue as a going concern.

Liquidity and Capital Resources

It is the intent of our management, stockholders, and specifically the majority Shareholder, BioDynamic Molecular Technologies, LLC and our Chief Executive Officer, Gary R. Smith, our Chief Financial Officer, Gary D. Alexander and Our Chief Operating Officer, Manpreet Singh Thaper to provide sufficient working capital necessary to support and preserve the integrity of our Company as a corporate entity. However, there is no legal obligation for either the majority Shareholder(s) or Officer(s) to provide additional future funding. If our management ceases to provide us the needed financing and we fail to identify any alternative sources of funding, there will be substantial doubt about our ability to continue as a "going concern".

We have no current plans, proposals, arrangements or understandings with respect to the sale or issuance of additional securities. As a result, there can be no assurance that sufficient funds will be available to us to enable us to pay the expenses related to such activities.

Regardless of whether or not our cash assets prove to be adequate to meet our operational needs, we may have to compensate providers of services by issuances of our common stock in lieu of cash.

At August 31, 2014, we had $4,756 in cash, $1,275,509 in liabilities, and an accumulated deficit of $7,279,830. Our primary source of liquidity has been from loans from a majority shareholder(s) and loans from outside parties. As of August 31, 2014, the Company owed $1,254,703 in notes and accrued interest).

Net cash used in operating activities was $(51,003) during the quarter ended August 31, 2014.

Cash used in investing activities was $(1,767) during the quarter ended August 31, 2014.

Cash used in financing activities was $(63,349) during the quarter ended August 31, 2014.

Our expenses to date are largely due to professional fees that include accounting and legal fees.

The Company has a working capital deficit of $682,170 and has incurred net losses of $7,279,830 for the period from December 29, 2005 (inception) to August 31, 2014. Our future capital requirements will depend on numerous factors, including, but not limited to, executing our marketing and business plans and the ability to pursue other business opportunities. We are actively pursuing alternative financing and have had discussions with various third parties, although no firm commitments have been obtained to date. In the interim, shareholders of the Company have agreed to meet our operating expenses. We believe that actions presently being taken to revise our operating and financial requirements provide the Company with the opportunity to continue as a "going concern," although no assurances can be given.

Net Loss

We incurred a net loss of $561,810 and $2,458,941 for the three months and six months ended August 31, 2014, respectively, compared to a net loss of $1,031,484 and $1,067,279 for the three months and six months ended August 31, 2013, respectively. From inception on December 29, 2005 to August 31, 2014, we have incurred a net loss of $7,279,830. Our basic and diluted loss per share was $(0.01) and $(0.03) for the three months and six months ended August 31, 2014, respectively, and $(0.01) and $(0.01) for the three months and six months ended August 31, 2013, respectively.

Operating and Administration Expenses

Operating expenses increased by $93,550 from $646,609 in the three months ended August 31, 2013, to $740,159 in the three months ended August 31, 2014.

Operating expenses increased by $2,405,103 from $654,426 in the six months ended August 31, 2013, to $3,059,529 in the six months ended August 31, 2014.

Operating expenses for the six months comparison primarily consist of office administration, professional and regulatory compliance, investor relations and marketing and advertising.

Other Expenses

Other income (expenses) increased by $534,362 from $(387,266) in the three months ended August 31, 2013, to $147,096 in the three months ended August 31, 2014.

Other income (expenses) increased by $643,578 from $(415,244) in the six months ended August 31, 2013, to $228,334 in the six months ended August 31, 2014.

Other expenses for the six months comparison primarily consist of interest expense, depreciation and derivative related costs.

Common and Preferred Stock

We are authorized by our Amended and Restated Articles of Incorporation and our Additional Articles of Incorporation to issue an aggregate of 200,000,000 shares of capital stock, of which 100,000,000 are shares of common stock, par value $0.00001 per share (the "Common Stock") and 100,000,000 are shares of preferred stock (the "Preferred Stock"), par value $0.00001 per share. As of August 31, 2014, 56,233,708 shares of Common Stock were issued and outstanding and there were 77 shareholders of our Common Stock and 0 shares of Preferred Stock were issued and outstanding.

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