Feed to the latest filings at the SEC
Date Filed : Sep 05, 2013
As filed with the Securities and ExchangeCommission on September 5, 2013
Registration No. _______________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
REGISTRATION STATEMENT UNDER THE SECURITIESACT OF 1933
(Exact name of registrant as specified inits charter)
(State or other jurisdiction of incorporation)
(Primary Standard Industrial ClassificationCode Number)
(IRS Employer Identification No.)
777 Main Street, Suite 600, Fort Worth,TX 76102
(Address and telephonenumber of registrant’s principal executive offices)
Jackie Williams, President
(Name, address and telephonenumber of agent for service)
Copies of all communications to:
Bart and Associates, LLC
Kenneth Bart, Esq.
8400 East Prentice Avenue, Suite 1500, GreenwoodVillage, CO 80111
Approximate date of commencement of proposed sale to the public:from time to time after the effective date of this Registration Statement as determined by market conditions and other factors.
If anyof the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under theSecurities Act of 1933, check the following box. x
Ifthis Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check thefollowing box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for thesame offering. ¨
Ifthis Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and listthe Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering. ¨
Ifthis Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and listthe Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering. ¨
Indicate by check mark whether the registrantis a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.
CALCULATION OF REGISTRATION FEE
THE REGISTRANT HEREBY AMENDS THIS REGISTRATIONSTATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENTWHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OFTHE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGECOMMISSION, ACTING PURSUANT TO SUCH SECTION 8(A), MAY DETERMINE.
The information in this prospectus isnot complete and may be changed. The Company may not sell these securities until the registration statement filed withthe Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and itis not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
The date of this Prospectus is September5, 2013
699,444 Shares of Common Stock
Par Value $0.0001 per share
This prospectus relates to the offeringby the selling stockholders of Appyea, Inc. of up to 699,444 shares of its Common Stock, par value $0.0001 per share. Currently,there is no market for our securities. The Company will not receive any proceeds from the sale of common stock. The selling stockholdershave advised us that they will sell the shares of common stock being registered from time to time in private transactions to otherindividuals, at the initial offering price of $0.50, which was determined arbitrarily by the Company and bears no relationshipto the Company's assets, book value, potential earnings or any other recognized criteria of value, until the shares are quotedon the Over the Counter Bulletin Board (“OTCBB”) or national securities exchange, and thereafter at prevailing marketprices,in privately negotiated transactions or otherwise as described under the section of this prospectus titled “Plan ofDistribution”. To be quoted on the OTC Bulletin Board, a market maker must file an application on our behalf in order tomake a market in our common stock. While the Company plans to have its shares quoted on the OTCBB there is no assurance that itsshares will be approved for quotation on the OTCBB or on any other quotation service or exchange.
You should rely only on the informationcontained in this prospectus or any prospectus supplement or amendment. We have not authorized anyone to provide you with differentinformation.
AppYea, Inc. is a development stage companythat is currently generating minimal revenue. The Company has had recurring losses from operations since Inception (November 26,2012) and our auditors have raised questions about our ability to continue as a going concern. Any investment in the shares offeredherein involves a high degree of risk. One should purchase shares only if one can afford a complete loss of one’s investment.
The Company will not receive any proceedsfrom the sale of common stock.
There is no current market for the securities.Although the registrant’s common stock has a par value of $0.0001, the registrant has valued the common stock in good faithand for the purposes of the registration fee, based on $0.50 per share. In the event of a stock split, stock dividend or similartransaction involving our common stock, the number of shares registered shall automatically be increased to cover the additionalshares of common stock issuable pursuant to Rule 416 under the Securities Act of 1933, as amended.
We are an “emerging growth company”as defined under the federal securities laws and, as such, may elect to comply with certain reduced public company reporting requirementsfor future filings.
BEFORE INVESTING, YOU SHOULD CAREFULLYREAD THIS PROSPECTUS AND, PARTICULARLY, THE RISK FACTORS SECTION, BEGINNING ON PAGE 7.
Neither the U.S. Securities and ExchangeCommission nor any state securities division has approved or disapproved these securities, or passed upon the accuracy or adequacyof the disclosures in the prospectus. Any representation to the contrary is a criminal offense.
TABLE OF CONTENTS
SUMMARY OF PROSPECTUS
One should read the following summary togetherwith the more detailed business information, financial statements and related notes that appear elsewhere in this prospectus. Inthis prospectus, unless the context otherwise denotes, references to "we," "us," "our," the “Company”and “AppYea” refer to AppYea, Inc.
General Information about Our Company
AppYea,Inc. (“AppYea”) was incorporated in the State of South Dakota on November 26, 2012. AppYea, Inc. is engagedin the acquisition, purchase, maintenance and creation of mobile software applications. The Company is in the development stagewith no significant revenues and a limited operating history.
The Company’s current business plansinclude marketing its current mobile applications, as well as expanding its mobile application portfolio through the acquisitionof third party mobile applications and mobile applications development companies. The Company derives revenue by way of the saleof its developed and acquired mobile applications.
The administrative office of the Companyis located at 777 Main Street, Suite 600, Forth Worth, TX 76102. The Company plans to use these offices until it requires largerspace. The Company’s fiscal year end is June 30th. The Company has not been subject to any bankruptcy, receivershipor similar proceeding.
Following is a brief summary of this offering.Please see the “Plan of Distribution” section for a more detailed description of the terms of the offering.
The Company officers, directors and controlpersons do not intend to purchase any shares in this offering.
Selected financial data
The following financialinformation summarizes the more complete historical financial information at the end of this prospectus. Total Expenses are composedof General and Administrative costs and Professional Fees.
Period from November 26, 2012 (date of
Inception) to June 30, 2013
An investment in these securities involvesan exceptionally high degree of risk and is extremely speculative in nature. You should carefully consider the risk factors listedbelow, together with the information contained in this prospectus, any reports we file with the SEC and the documents referredto herein. Following are what is believed are all of the material risks involved if one decides to purchase shares in this offering.
RISKS ASSOCIATED WITH OUR COMPANY:
We are an “emerging growth company,” and thereduced disclosure requirements applicable to “emerging growth companies” could make our common stock less attractiveto investors.
We are an “emerginggrowth company,” as defined in the JOBS Act. For as long as we are an emerging growth company, we may take advantage of certainexemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies,including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of theSarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statementsand exemptions from the requirements of holding advisory “say-on-pay” votes on executive compensation and shareholderadvisory votes on golden parachute compensation. We will remain an “emerging growth company” until the earliest of(i) the last day of the fiscal year during which we have total annual gross revenues of $1 billion or more; (ii) The lastdate of the fiscal year following the fifth anniversary of the date of the first sale of common stock under this registration statement;(iii) the date on which we have, during the previous three-year period, issued more than $1 billion in non-convertible debt; and(iv) the date on which we are deemed to be a “large accelerated filer” under the Exchange Act. We will be deemed alarge accelerated filer on the first day of the fiscal year after the market value of our common equity held by non-affiliatesexceeds $700 million, measured on October 31.
We cannot predictif investors will find our common stock less attractive to the extent we rely on the exemptions available to emerging growth companies.If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stockand our stock price may be more volatile.
In addition, Section107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period providedin Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. An emerging growth companycan therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
However, we are choosingto “opt out” of such extended transition period, and as a result, we will comply with new or revised accounting standardson the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBSAct provides that our decision to opt out of the extended transition period for complying with new or revised accounting standardsis irrevocable.
Because the Company auditors haveissued a going concern opinion, there is a substantial uncertainty that it will continue operations in which case one could loseone’s investment.
The auditors have issued a going concernopinion because the Company has incurred losses from operations since Inception (November 26, 2012) and currently does not havesufficient available funding to fully implement its business plan. This means that there is substantial doubt that it cancontinue as an ongoing business for the next twelve months. The financial statements do not include any adjustments that mightresult from the uncertainty about its ability to continue in business. As such it may have to cease operations and you couldlose your entire investment.
Our Officers and Directors have limitedpublic company experience. The Company’s needs could exceed the amount of time or level of experience they may have. Thiscould result in their inability to properly manage Company affairs, resulting in it remaining a start-up company with no revenuesor profits, which could cause the loss of one’s entire investment.
The Company business plan does not providefor the hiring of any additional employees other than outlined in its Plan of Operations until sales will support the expense.Until that time the responsibility of developing the Company’s business, the offering and selling of the shares through thisprospectus and fulfilling the reporting requirements of a public company all fall upon the three officers and two directors. WhileJackie Williams has over 21 years of management experience in a large product distribution company, none of our officers and directorshave experience in a public company setting, including serving as a principal accounting officer or principal financial officer.Further, they have no experience in complying with the various rules and regulations which are required of a public company, andas a result, they may not be able to operate successfully as a public company, even if the Company’s operations are successful.While each of the Company’s officers and directors will use their best judgments to resolve all potential conflicts, thereis no formulated plan to resolve any possible conflict of interest with their other business activities, and we cannot guaranteethat any potential conflicts can be avoided. In the event they are unable to fulfill any aspect of their duties to the Companyit may experience a shortfall or complete lack of sales resulting in little or no profits and eventual closure of its business.
Since it is a development stage company,that has generated no significant revenues and lacks an operating history, an investment in the shares offered herein is highlyrisky and could result in a complete loss of your investment if the company is unsuccessful in its business plans.
This Company was incorporated in November2012; it has focused all of its efforts on the development of its product and it has generated minimal revenue. There is no operatinghistory upon which an evaluation of its future prospects can be made. Based upon current plans, the Company expects to incur operatinglosses in future periods as it incurs significant expenses associated with the initial startup of its business. Further, thereis no guarantee that it will be successful in realizing revenues or in achieving or sustaining positive cash flow at any time inthe future. Any such failure could result in the possible closure of its business or force the company to seek additional capitalthrough loans or additional sales of its equity securities to continue business operations, which would dilute the value of anyshares you purchase in this offering.
Since the Company has shown a netloss since Inception (November 26, 2012), an investment in the shares offered herein is highly risky and could result in a completeloss of your investment if the Company is unsuccessful in its business plans.
Based upon current plans, the Company expectsto incur operating losses in future periods as it incurs significant expenses associated with the growth of its business. Further,there is no guarantee that it will be successful in realizing future revenues or in achieving or sustaining positive cash flowat any time in the future. Any such failure could result in the possible closure of its business or force the company to seek additionalcapital through loans or additional sales of its equity securities to continue business operations, which would dilute the valueof any shares you purchase in this offering.
The Company cannot guarantee thatit will continue to generate revenues which could result in a total loss of your investment if it is unsuccessful in its businessplans.
While the Company has generated limitedrevenues, which are reported in the financial statements included in this Prospectus, there can be no assurance that it will continueto generate revenues or that revenues will be sufficient to maintain its business. As a result, one could lose all of one’sinvestment if the Company is not successful in its proposed business plans.
Growth and development of operationswill depend on the acceptance of the Company’s proposed business. If the Company’s services are not deemed desirableand suitable for purchase and it cannot establish a customer base, it may not be able to generate future revenues, which wouldresult in a failure of the business and a loss of any investment one makes in the shares.
The acceptance of the Company’s productsfor its customers is critically important to its success. The Company cannot be certain that the services that it will be offeringwill be appealing and as a result there may not be any demand for these products and its sales could be limited and it may neverrealize any revenues. In addition, there are no assurances that if it alters or changes the products it offers in the future thatthe demand for these new products will develop and this could adversely affect our business and any possible revenues.
If demand for the services the Companyplans to offer slows, then its business would be materially affected, which could result in the loss of your entire investment.
Demand for the services which it intendsto sell depends on many factors, including:
For the long term, demand for the productsit plans to offer may be affected by:
All of these factors could result in immediateand longer term declines in the demand for the services it plans to offer, which could adversely affect its sales, cash flows andoverall financial condition. An investor could lose his or her entire investment as a result.
The loss of the services of the currentofficers and directors could severely impact the Company business operations and future development, which could result in a lossof revenues and one’s ability to ever sell any shares one purchases in this offering.
The performance of the Company is substantiallydependent upon the professional expertise of the current officers and board of directors. The Company is dependent on their abilitiesto develop its business. If they are unable to perform their duties, this could have an adverse effect on Company business operations,financial condition and operating results if it is unable to replace them with other individuals qualified to develop and marketits business. The loss of their services could result in a loss of revenues, which could result in a reduction of the value ofany shares you purchase in this offering as well as the complete loss of your investment.
The Company may not be able to successfullyimplement its business strategy, which could adversely affect its business, financial condition, results of operations and cashflows. If the Company cannot successfully implement its business strategy, it could result in the loss of your investment.
Successful implementation of its businessstrategy depends on numerous factors that may be beyond its control. Adverse changes in the following factors could undermine ourbusiness strategy and have a material adverse effect on its business, its financial condition, and results of operations and cashflow:
There are no substantial barriersto entry into the industry and because the company does not currently have any copyright protection for the services it intendsto sell, there is no guarantee someone else will not duplicate its ideas and bring them to market before it does, which could severelylimit the Company proposed sales and revenues. If the Company cannot generate sales and revenues, it could result in the loss ofyour investment.
Since it has no intellectual property protection,unauthorized persons may attempt to copy aspects of its business, including its services or marketing materials. Any encroachmentupon the Company corporate information, including the unauthorized use of its brand name, the use of a similar name by a competingcompany or a lawsuit initiated against it for infringement upon another company's proprietary information or improper use of theircopyright, may affect its ability to create brand name recognition, cause customer confusion and/or have a detrimental effect onits business. Litigation or proceedings before the U.S. or International Patent and Trademark Offices may be necessary in the futureto enforce the company intellectual property rights, to protect its trade secrets and domain name and/or to determine the validityand scope of the proprietary rights of others. Any such infringement, litigation or adverse proceeding could result in substantialcosts and diversion of resources and could seriously harm its business operations and/or results of operations. As a result, aninvestor could lose his or her entire investment.
As the Company intends to be conductinginternational business transactions, it will be exposed to local business risks in different countries, which could have a materialadverse effect on its financial condition or results of operations, which could result in the loss of your investment.
The Company intends to promote and sellsome of its products internationally by way of using mobile application online stores, and we expect to have customers in multiplecountries. The Company international operations will be subject to risks inherent in doing business in foreign countries, including,but not necessarily limited to:
It may not be successful in developingand implementing policies and strategies to address the foregoing factors in a timely and effective manner in the locations whereit will do business. Consequently, the occurrence of one or more of the foregoing factors could have a material adverse effecton its base operations and upon its financial condition and results of operations.
Since its services will be available overthe Internet in foreign countries and the Company will have customers residing in foreign countries, foreign jurisdictions mayrequire it to qualify to do business in their country. It will be required to comply with certain laws and regulations of eachcountry in which it conducts business, including laws and regulations currently in place or which may be enacted related to Internetservices available to the residents of each country from online sites located elsewhere.
The Company’s operations indeveloping markets could expose it to political, economic and regulatory risks that are greater than those it may face in establishedmarkets. Further, its international operations may require it to comply with additional United States and international regulations.If the Company fails to comply with the required domestic and international regulations or violates any such regulations, it maynot be able to generate sales and revenue necessary to continue its business plans, which could result in the loss of your investment.
For example, it may be required to complywith the Foreign Corrupt Practices Act, or "FCPA," which prohibits companies or their agents and employees from providinganything of value to a foreign official or agent thereof for the purposes of influencing any act or decision of these individualsin their official capacity to help obtain or retain business, direct business to any person or corporate entity or obtain any unfairadvantage. The Company may operate in some nations that have experienced significant levels of governmental corruption. Its employees,agents and contractors, including companies to which it outsources business operations, may take actions in violation of its policiesand legal requirements. Such violations, even if prohibited by its policies and procedures, could have an adverse effect on itsbusiness and reputation. Any failure by the Company to ensure that its employees and agents comply with the FCPA and applicablelaws and regulations in foreign jurisdictions could result in substantial civil and criminal penalties or restrictions on its abilityto conduct business in certain foreign jurisdictions, and its results of operations and financial condition could be materiallyand adversely affected. Finally, any additional regulatory requirements put in place by the United States or any foreign countryin which the Company operates may expose the company to additional liability, and require the Company to comply with complex andtime consuming regulations.
Failure of third-party service providersupon which we rely could adversely affect our business and result in the loss of your investment.
The Company may rely on certain third-partyservice providers, including data centers, call centers, direct posts, aggregators, publishers, insurance carriers, insurance agencies,back-office systems, Internet and wireless service providers and communications facilities. Any interruption in these third-partyservices, or deterioration in their performance or quality, could adversely affect our business. If its arrangement with any thirdparty is terminated, it may not be able to find alternative systems or service providers on a timely basis or on commercially reasonableterms. This could have a material adverse effect on its business, financial condition, results of operations and cash flows.
A Disruption in Online Service WouldCease or Suspend Service to our customers, which could negatively affect our business, customer base, sales, revenue, and couldresult in the loss of your investment
The Company cannot guarantee that its appswill operate without interruption or error. The Company is bound only by a best efforts obligation as regards the operationand continuity of service. Although it is not to be liable for the alteration or fraudulent access to data and/or accidentaltransmission through viruses or other harmful conduct in connection with the use of its products and services, disruption of itsonline service would adversely affect its business, financial conditions, results of operations and cash flows.
RISKS ASSOCIATED WITH THIS OFFERING:
The Offering Price of the Company Shares is arbitrary,so there is no guarantee that the price at which you have purchased your shares will remain the same. A significant decrease inthe price of our shares could result in the loss of your investment.
The offering price of the Company’sshares has been determined arbitrarily by the Company and bears no relationship to the Company's assets, book value, potentialearnings or any other recognized criteria of value.
The trading in the Company shareswill be regulated by Securities and Exchange Commission Rule 15g-9 which established the definition of a “penny stock.”The effective result is that fewer purchasers are qualified by their brokers to purchase its shares, and therefore a less liquidmarket for the investors to sell their shares. Therefore, you may have a difficult time selling your shares, or you may not beable to sell your shares at all, which could result in the loss of your investment.
The shares being offered are defined asa penny stock under the Securities and Exchange Act of 1934, and rules of the Commission. The Exchange Act and such penny stockrules generally impose additional sales practice and disclosure requirements on broker-dealers who sell our securities to personsother than certain accredited investors who are, generally, institutions with assets in excess of $5,000,000 or individuals withnet worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with spouse), or in transactions notrecommended by the broker-dealer. For transactions covered by the penny stock rules, a broker-dealer must make a suitability determinationfor each purchaser and receive the purchaser's written agreement prior to the sale. In addition, the broker-dealer must make certainmandated disclosures in penny stock transactions, including the actual sale or purchase price and actual bid and offer quotations,the compensation to be received by the broker-dealer and certain associated persons, and deliver certain disclosures required bythe Commission. Consequently, the penny stock rules may make it difficult or impossible for you to resell any shares you may purchase.
Due to the lack of a trading marketfor our securities, you may have difficulty selling any shares you purchase in this offering, which could result in the loss ofyour investment.
There is presently no demand for our commonstock and no public market exists for the shares being offered in this prospectus. We plan to contact a market maker immediatelyfollowing the effectiveness of this Registration Statement to file an application to have our shares quoted on the OTC ElectronicBulletin Board (OTCBB), however, there is no guarantee that a trading market will ever develop. The OTCBB is a regulated quotationservice that displays real-time quotes, last sale prices and volume information in over-the-counter (OTC) securities. The OTCBBis not an issuer listing service, market or exchange. Although the OTCBB does not have any listing requirements per se, to be eligiblefor quotation on the OTCBB, issuers must remain current in their filings with the SEC or applicable regulatory authority. MarketMakers are not permitted to begin quotation of a security whose issuer does not meet this filing requirement. Securities alreadyquoted on the OTCBB that become delinquent in their required filings will be removed following a 30 or 60 day grace period if theydo not make their required filing during that time. The Company cannot guarantee that our application will be accepted or approvedor that its stock will be quoted for sale. As of the date of this filing, there have been no discussions or understandings betweenAppYea, Inc. or anyone acting on its behalf with any market maker regarding participation in a future trading market for its securities.If no market is ever developed for our common stock, it will be difficult or impossible for you to sell any shares you purchasein this offering. In such case, you may find that you are unable to achieve any benefit from your investment or liquidate yourshares without considerable delay, if at all. In addition, if the Company fails to have its common stock quoted on a public tradingmarket, your common stock will not have a quantifiable value and it may be difficult, if not impossible, to ever resell your shares,resulting in an inability to realize any value from your investment.
Youwill incur immediate and substantial dilution of the price you pay for your shares, which could affect the overall monetary valueof your shares. If the value of your shares significantly decreases, you could lose your investment.
Any investment you make in these shareswill result in the immediate and substantial dilution of the net tangible book value of those shares from the $0.50 you pay forthem. Upon completion of the offering, the net tangible book value of your shares will be $0.06 per share, $0.44 less than whatyou paid for them.
The Compan’sy officers anddirectors will continue to exercise significant control over our operations, which means as a minority stockholder, you would haveno control over certain matters requiring stockholder approval that could affect your ability to ever resell any of your shares.If you are not able to resell any shares, it may result in the loss of your investment.
Our executive officers and directors willcontinue to have a significant influence in determining the outcome of all corporate transactions, including the election of directors,approval of significant corporate transactions, changes in control of the Company or other matters that could affect your abilityto ever resell your shares. Their interests may differ from the interests of the other stockholders and thus result in corporatedecisions that are disadvantageous to other stockholders.
We may never pay dividends to shareholders,which could reduce the monetary gain you may realize on your investment.
We have not declared or paid any cash dividendsor distributions on our capital stock. We currently intend to retain our future earnings, if any, to support operations andto finance expansion and therefore we do not anticipate paying any cash dividends on our common stock in the foreseeable future.
The declaration, payment and amount ofany future dividends will be made at the discretion of the board of directors, and will depend upon, among other things, the resultsof our operations, cash flows and financial condition, operating and capital requirements, and other factors as the board of directorsconsiders relevant. There is no assurance that future dividends will be paid, and, if dividends are paid, there is no assurancewith respect to the amount of any such dividend. If the Company does not pay dividends, the Company’s common stockmay be less valuable because a return on an investor’s investment will only occur if the Company’s stock price appreciates.
Because our common stock is not registeredunder the Exchange Act, we will not be subject to the federal proxy rules and our directors, executive offices and 10% beneficialholders will not be subject to section 16 of the Exchange Act. In addition, our reporting obligations under section 15(d) of theExchange Act may be suspended automatically if we have fewer than 300 shareholders of record on the first day of our fiscal year.
Our common stock is not registered underthe Exchange Act, and we it do not intend to register our common stock under the Exchange Act for the foreseeable future (providedthat, we will register our common stock under the Exchange Act if we ha, after the last day of our fiscal year, more than 500 shareholdersof record, in accordance with Section 12(g) of the Exchange Act; as of June 30, 2013 we have 59 shareholders of record). As long as our common stock is not registered under the Exchange Act, we will not be subject to Section 14 of the Exchange Act,which, among other things, prohibits companies that have securities registered under the Exchange Act from soliciting proxies orconsents from shareholders without furnishing to shareholders and filing with the SEC a proxy statement and form of proxy complyingwith the proxy rules. In addition, so long as our common stock is not registered under the Exchange Act, our directorsand executive officers and beneficial holders of 10% or more of our outstanding common stock will not be subject to Section 16of the Exchange Act. Section 16(a) of the Exchange Act requires executive officers and directors, and persons who beneficiallyown more than 10% of a registered class of equity securities to file with the SEC initial statements of beneficial ownership, reportsof changes in ownership and annual reports concerning their ownership of common shares and other equity securities, on Forms 3,4, and 5 respectively. Such information about our directors, executive officers, and beneficial holders will only beavailable through periodic reports and any registration statements on Form S-1 we file. Furthermore, so long as ourcommon stock is not registered under the Exchange Act, our obligation to file reports under Section 15(d) of the Exchange Act willbe automatically suspended if, on the first day of any fiscal year (other than a fiscal year in which a registration statementunder the Securities Act has gone effective), we have fewer than 300 shareholders of record. This suspension is automaticand does not require any filing with the SEC. In such an event, we may cease providing periodic reports and currentor periodic information, including operational and financial information, may not be available with respect to our results of operations.
Although we expects to apply forquotation on the OTC bulletin board (OTCBB), we may not be approved, and even if approved, we may not be approved for trading onthe OTCBB; therefore shareholders may not have a market to sell their shares, either in the near term or in the long term, or both.
We are not registered on any market orpublic stock exchange. There is presently no demand for our common stock and no public market exists for the shares being offeredin this prospectus. We plans to contact a market maker immediately following this registration statement on Form S-1 being declaredeffective and apply to have the shares quoted on the Over-the-Counter Bulletin Board ("OTCBB"). The OTCBB is a regulatedquotation service that displays real-time quotes, last sale prices and volume information in over-the-counter securities. The OTCBBis not an issuer listing service, market or exchange. Although the OTCBB does not have any listing requirements per se, to be eligiblefor quotation on the OTCBB, issuers must remain current in their filings with the SEC or applicable regulatory authority. Marketmakers are not permitted to begin quotation of a security whose issuer does not meet this filing requirement. Securities alreadyquoted on the OTCBB that become delinquent in their required filings will be removed following a 30 to 60 day grace period if theydo not make their required filing during that time. We cannot guarantee that our application will be accepted or approved and ourstock listed and quoted for sale. If our application is rejected, our stock may then be traded on the "Pink Sheets,"and the market for resale of our shares would decrease dramatically, if not be eliminated. As of the date of this filing, therehave been no discussions or understandings between the Company and anyone acting on our behalf, with any market maker regardingparticipation in a future trading market for our securities. If no market is ever developed for our common stock, it will be difficultfor you to sell any shares you purchase in this offering. In such a case, you may find that you are unable to achieve any benefitfrom your investment or liquidate your shares without considerable delay, if at all. In addition, if we fails to have our commonstock quoted on a public trading market, your common stock will not have a quantifiable value and it may be difficult, if not impossible,to ever resell your shares, resulting in an inability to realize any value from your investment.
FORWARD LOOKING STATEMENTS
This Prospectus contains projections andstatements relating to the Company that constitute “forward-looking statements.” These forward-looking statementsmay be identified by the use of predictive, future-tense or forward-looking terminology, such as “intends,” “believes,”“anticipates,” “expects,” “estimates,” “may,” “will,” “might,”“outlook,” “could,” “would,” “pursue,” “target,” “project,”“plan,” “seek,” “should,” “assume,” or similar terms or the negatives thereof. Suchstatements speak only as of the date of such statement, and the Company undertakes no ongoing obligation to update such statements. Thesestatements appear in a number of places in this Prospectus and include statements regarding the intent, belief or current expectationsof the Company, and its respective directors, officers or advisors with respect to, among other things:
Potential investors are cautioned thatany such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, andthat, should conditions change or should any one or more of the risks or uncertainties materialize or should any of the underlyingassumptions of the Company prove incorrect, actual results may differ materially from those projected in the forward-looking statementsas a result of various factors, some of which are unknown. The factors that could adversely affect the actual resultsand performance of the Company include, without limitation:
Potential investors are urged to carefullyconsider such factors. All forward-looking statements attributable to the Company or persons acting on its behalf areexpressly qualified in their entirety by the foregoing cautionary statements and the “Risk Factors” described herein.
USE OF PROCEEDS
This Prospectus relates to the resale ofour common stock that may be offered and sold from time to time by the selling shareholders. The Company will not receive any proceedsfrom the sale of shares of common stock in this offering.
DETERMINATION OF OFFERING PRICE
The offering price of $0.50 per share hasbeen determined arbitrarily by the Directors of the Company. The price does not bear any relationship to the Company’s assets,book value, earnings, or other established criteria for valuing a company. In determining the number of shares to be offered andthe offering price the Board of Directors took into consideration capital structure and the amount of money it would need to implementthe Company business plans. Accordingly, the offering price should not be considered an indication of the actual value of its securities.
These shares of commonstock may be sold by the selling stockholders from time to time in the over-the-counter market or on other national securitiesexchanges or automated interdealer quotation systems on which our common stock may be listed or quoted, through negotiated transactionsor otherwise at market prices prevailing at the time of sale or at negotiated prices. The distribution of the shares by the sellingstockholders is not subject to any underwriting agreement. The selling stockholders will sell their shares at the initial offeringprice of $0.50 per share until the shares are traded on the OTC Bulletin Board or a national securities exchange, at which pointthe selling shareholders may sell the registered shares at the prevailing market price for the shares at the time of sale.We will file a post-effective amendment to this registration statement to reflect a change to the market price when the sharesbegin trading on a market.
To be quoted on theOTC Bulletin Board, a market maker must file an application on our behalf in order to make a market in our common stock. Thereis no certainty that our shares will be quoted on the OTC Bulletin Board or listed on any exchange.
DILUTION OF THE PRICE YOU PAY FORYOUR SHARES
Dilution represents the difference betweenthe offering price and the net tangible book value per share immediately after completion of this offering.
Net tangible book value is the amount thatresults from subtracting total liabilities and intangible assets from total assets. Dilution arises mainly as a result of our arbitrarydetermination of the offering price of the shares being offered. Dilution of the value of the shares you purchase is also a resultof the lower book value of the shares held by our existing stockholders.
As of the date of this prospectus, thenet tangible book value of the Company shares is $132,152 or approximately $0.06 per share, based upon 2,299,444 shares outstanding.
Upon the sale of shares offered hereby, the net tangible bookvalue of the Shares held by our existing stockholders will not be increased . However the purchasers of Shares will incur immediatedilution (a reduction in net tangible book value per Share from the offering price of $0.50 per Share) of $(0.44) per share.
The following tables illustrate the pershare dilution to the new investors and does not give any effect to the results of any operations subsequent to March 31, 2013:
Thefollowing table sets forth the shares beneficially owned, as of the date of this prospectus, by the selling stockholders priorto the offering contemplated by this prospectus, the number of shares each selling stockholder is offering by this prospectus andthe number of shares which each selling stockholder would own beneficially if all such offered shares are sold. Noneof the selling stockholders is known to us to be a registered broker-dealer or an affiliate of a registered broker-dealer. Eachof the selling stockholders has acquired his, her or its shares solely for investment and not with a view to or for resale or distributionof such securities. Beneficial ownership is determined in accordance with SEC rules and includes voting or investmentpower with respect to the securities. The selling security holders are under no obligation to sell all or any portion of the shareslisted below.
Acquisition of Shares by Selling Shareholders
On November 19, 2012, the Company issued 40,000 shares to EdouardProus at a price of $0.0001 per share
On November 19, 2012, the Company issued 40,000 shares to JackWilliams Sr. at a price of $0.0001 per share.
On November 19, 2012, the Company issued 40,000 shares to ZacharyWilliams at a price of $0.0001 per share.
On November 19, 2012, the Company issued 40,000 shares to JeffYoung at a price of $0.0001 per share.
On November 19, 2012, the Company issued 30,000 shares to DewayneHorton at a price of $0.0001 per share.
On November 19, 2012, the Company issued 40,000 shares to PeterDunne at a price of $0.0001 per share.
On November 19, 2012, the Company issued 40,000 shares to PatrickO’Neal at a price of $0.0001 per share.
On November 19, 2012, the Company issued 30,000 shares to ChrisAddison at a price of $0.0001 per share.
On November 19, 2012, the Company issued 40,000 shares to JasonLehmann at a price of $0.0001 per share.
On November 19, 2012, the Company issued 30,000 shares to WesShook at a price of $0.0001 per share.
On November 19, 2012, the Company issued 30,000 shares to RickReese at a price of $0.0001 per share.
Dewayne Horton, Wes Shook and Rick Reesealso each acquired an additional 2,000 shares pursuant to the below described Regulation D, Rule 505 offering at a price of $0.50per share.
Chris Addison also acquired an additional5,000 shares pursuant to the below described Regulation D, Rule 505 offering at a price of $0.50 per share.
Such other shareholders listed below includethe holders of shares sold in a Regulation D, Rule 505 offering of 299,444 shares completed on June 6, 2013 at an offering priceof $0.50 per share, which resulted in total proceeds of $119,722, with 40,000 of the shares being issued to Catalina Ventures aspart of a $20,000 asset acquisition and 20,000 of the shares being issued to Mike Flynn pursuant to a $10,000 debt conversion.
(1) All shares are owned of record and beneficially unless otherwiseindicated. Beneficial ownership information for the selling stockholders is provided as of June 30, 2013, based upon informationprovided by the selling shareholders or otherwise known to us
(2) Assumes the sale of all shares of common stock registeredpursuant to this prospectus. The selling stockholders are under no obligation known to us to sell any shares of common stock atthis time.
(3) Catalina Ventures, Inc. is owned by Scott O’Neal.
(4) JM & A Enterprises, LP is owned by Stacy Butler.
PLAN OF DISTRIBUTION
Shares Offered by the Selling Stockholders
The selling security holders may sell some or all of their sharesfrom time to time at a fixed price of $0.50 per share until our shares are quoted on the OTCBB and thereafter at fixed prices,prevailing market prices at the time of sale, at varying prices determined at the time of sale, or privately negotiated prices.Prior to being quoted on the OTCBB, shareholders may sell their shares in private transactions to other individuals. As of thedate of this Prospectus, our common stock is not listed on a public exchange. Upon the effectiveness of this Registration Statement,the Company plans to contact a market maker to obtain a listing on the OTCBB. In order to be quoted on the OTCBB, a market makermust file an application on its behalf in order to make a market for the Company’s common stock. There can be no assurancethat a market maker shall agree to file the necessary documents with FINRA, which operates the OTCBB, nor can there be any assurancethat such an application for quotation will be approved or that our shares will be quoted on any exchange.
Once a market has been developed for the Company’s commonstock, the shares may be sold or distributed from time to time by the selling stockholders directly to one or more purchasers orthrough brokers or dealers who act solely as agents, at market prices prevailing at the time of sale, at prices related to suchprevailing market prices, at negotiated prices or at fixed prices, which may be changed. The distribution of the shares may beeffected in one or more of the following methods:
exchangelisted or otherwise), or
Brokers, dealers, or agents participating in the distributionof the shares may receive compensation in the form of discounts, concessions or commissions from the selling stockholders and/orthe purchasers of shares for whom such broker-dealers may act as agent or to whom they may sell as principal, or both (which compensationas to a particular broker-dealer may be in excess of customary commissions). Neither the selling stockholders nor the Board Directorsof the Company can presently estimate the amount of such compensation. It knows of no existing arrangements between the sellingstockholders and any other stockholder, broker, dealer or agent relating to the sale or distribution of the shares. The companywill not receive any proceeds from the sale of the shares of the selling security holders pursuant to this prospectus. The Companyhas agreed to bear the expenses of the registration of the shares, including legal and accounting fees.
In addition, in some states the shares of common stock may notbe sold unless such shares have been registered or qualified for sale in such state or an exemption from registration or qualificationis available and is complied with. There can be no assurance that any selling stockholder will sell any or all of theshares of common stock registered pursuant to the shelf registration statement, of which this prospectus forms a part.
Each selling stockholder has informed us that it does not haveany agreement or understanding, directly or indirectly, with any person to distribute the common stock. None of theselling stockholders who are affiliates of broker-dealers, other than the initial purchasers in private transactions, purchasedthe shares of common stock outside of the ordinary course of business or, at the time of the purchase of the common stock, hadany agreements, plans or understandings, directly or indirectly, with any person to distribute the securities.
We are paying all fees and expenses incident to the registrationof the shares of common stock. Except as provided for indemnification of the selling stockholders, we are not obligatedto pay any of the expenses of any attorney or other advisor engaged by a selling stockholder. We have not agreed toindemnify any selling stockholders against losses, claims, damages and liabilities, including liabilities under the SecuritiesAct.
If we are notified by any selling stockholder that any materialarrangement has been entered into with a broker-dealer for the sale of shares of common stock, if required, we will file a supplementto this prospectus. If the selling stockholders use this prospectus for any sale of the shares of common stock, theywill be subject to the prospectus delivery requirements of the Securities Act.
The anti-manipulation rules of Regulation M under the ExchangeAct may apply to sales of our common stock and activities of the selling stockholders, which may limit the timing of purchasesand sales of any of the shares of common stock by the selling stockholders and any other participating person. RegulationM may also restrict the ability of any person engaged in the distribution of the shares of common stock to engage in passive market-makingactivities with respect to the shares of common stock. Passive market making involves transactions in which a marketmaker acts as both our underwriter and as a purchaser of our common stock in the secondary market. All of the foregoingmay affect the marketability of the shares of common stock and the ability of any person or entity to engage in market-making activitieswith respect to the shares of common stock.
Once sold under the registration statement, of which this prospectusforms a part, the shares of common stock will be freely tradable in the hands of persons other than our affiliates.
DESCRIPTION OF SECURITIES
The Company’s authorized capitalstock consists of 750,000,000 shares of common stock, par value $0.0001 per share. The holders of Company common stock (i) haveequal ratable rights to dividends from funds legally available therefore, when, as and if declared by its Board of Directors; (ii)are entitled to share in all of its assets available for distribution to holders of common stock upon liquidation, dissolutionor winding up of its affairs; (iii) do not have preemptive, subscription or conversion rights and there are no redemption or sinkingfund provisions or rights; and (iv) are entitled to one non-cumulative vote per share on all matters on which stockholders mayvote. As of the date of this prospectus, there are 2,299,444 shares of Common stock issued and outstanding.
The Company has authorized 5,000,000 sharesof Preferred Stock, Par Value $0.0001. As of the date of this Prospectus, there are 5,000,000 shares of Preferred Stock outstanding.Each convertible preferred share is convertible into 100 shares of common stock and has the voting rights of 1,000 share of commonstock.
Directors of the Company are elected atthe annual meeting of stockholders by a plurality of the votes cast at the election. Holders of shares of the Company’s commonstock do not have cumulative voting rights, which means that the holders of more than 50% of the outstanding shares, voting forthe election of directors, can elect all of the directors to be elected, if they so choose, and, in such event, the holders ofthe remaining shares will not be able to elect any of its directors. Stockholders have no pre-emptive rights.
As of the date of this prospectus, theCompany has not paid any cash dividends to stockholders. The declaration of any future cash dividend will be at the discretionof the Board of Directors and will depend upon the earnings of the Company, if any, its capital requirements and financial position,the general economic conditions, and other pertinent conditions. It is the Company’s present intention not to pay any cashdividends in the foreseeable future, but rather to reinvest earnings, if any, in its business operations.
INTEREST OF NAMED EXPERTS AND COUNSEL
None of the below described experts orcounsel have been hired on a contingent basis and none of them will receive a direct or indirect interest in the Company.
The audited financial statements and therelated statements of operations, stockholders’ equity and cash flows for the period from Inception (November 26, 2012)to June 30, 2013 and the audited financial statements and the related statements of operations, stockholders’ equity andcash flows for the period from Inception (November 26, 2012) to June 30, 2013, included in this prospectus have been audited byCutler & Co., LLC. Included are the financial statements in reliance on their report, given upon their authority as expertsin accounting and auditing.
The Law Office of Bart and Associates,LLC has passed upon the validity of the shares being offered and certain other legal matters and is representing us in connectionwith this offering.
DESCRIPTION OF OUR BUSINESS
AppYea, Inc. (“AppYea”) wasincorporated in the State of South Dakota on November 26, 2012. AppYea, Inc. is engaged in the acquisition, purchase, maintenanceand creation of mobile software applications. The Company is in the development stage with no significant revenues and a limitedoperating history.
On November 26, 2012, Jackie Williams wasappointed as the sole director, chairman of the board and President of the Company.
The Company is a development stage companythat is generating minimal revenues. The Company does not consider itself to be a blank check company as defined in Rule 419 ofRegulation C of the Securities Act of 1933. Based upon the above, the Company believes it is not within the scope of Rule 419.
The Company has not been subject to anybankruptcy, receivership or similar proceeding.
Because its business is customer-driven,its revenue requirements will be reviewed and adjusted based on sales. The costs associated with operating as a public companyare included in its budget. Management will be responsible for the preparation of much of the required documents to keep the coststo a minimum.
The Companyhas been issued an opinion by our auditors that raised substantial doubt about its ability to continue as a going concern basedon its current financial position. The ability to continue as a going concern is dependent upon the Company generating profitableoperations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising fromnormal business operations when they come due. Management intends to finance operating costs over the next twelve months with existingcash on hand, its revenue generation and/or issuance of common shares.
Principal products and their markets
Our Company’s primary products are mobile applications.Our Company develops internal mobile applications and also acquires existing profitable mobile applications (“apps”),in order to build a diverse portfolio of apps that will service a wide range of industries and consumers. The Company plans toacquire apps that are currently in development, as well as apps that are ready to be presented to the public. By purchasing existingsmall but profitable application development companies, AppYea aims to considerably cut the time to the market for introducingapps, which based on the Company’s experience, is approximately six months. The Company intends to market and sell its developedand acquired apps under its own name. The Company’s target customers vary widely, due to the numerous types of apps thatare currently available. Below, our current business strategy and plan are detailed in an effort to explain the methods by whichour company generates revenue.
Source Code Assets
On February 1, 2013, the Company acquireda portfolio of 13 award winning iOS kid friendly gaming mobile applications on the iOS platform. Thegame titles include SkyRaiders, DartWheel for iPhone & iPad, VultureHunt, PumpkinNinja, TinyCrusaders, TinyScots, TinyJones,TinyKnights, CowboyClimb, Stacker, Snap & DoodleFreak.
On April 2, 2013 the Company acquired aunique mobile application that will help the millions of Disney and Universal visitors by providing them with accurate attractionwait times, ride information, theme park maps, hours of park operation, parade and show times, firework times, and much more inthe palms of millions of iPhone users' hands. Currently, these features are available for Disney World's Magic Kingdom ®, Epcot®,Disney's Hollywood Studios®, and Disney's Animal Kingdom®.
The Company plans on expanding its portfolio of apps, both interms of the number of apps it owns, as well as the categories and industries in which those apps function.
The Company is currently developing its Katsomoto Gaming Division,which has developed thirteen separate apps that the Company intends to market and sell to a wide range of customers. In addition,the Company is currently attempting to market and sell its StreaMe app, which allows users of the app to stream music from onemobile device to another, thus creating a type of personal radio station.
Management and Development Role
Appyea intends to become a management company that supervisesand directs the application development work, while focusing its efforts on the promotion, marketing, and sales of its acquiredapps. AppYea intends to obtain the services of specialized app marketing companies in order to become well positioned in onlinemobile app stores. In addition, the Company believes that by properly marketing its apps, it will be able to increase downloads,lower the acquisition costs associated with the acquired apps, and expand its portfolio of apps for all current and future platforms.
Management believes the principal growth area in the personalcomputer market today is that of Smartphones and portable tablet devices; aside from being a large and quickly growing market,these mobile devices usually allow full time internet connectivity. At this time, the Company believes that by marketingits current app portfolio, and also expanding its portfolio, the Company will be able to provide a wide range of apps to many differenttypes of potential purchasers.
Revenue Model and Distribution methods of the productsor services
Our revenue model is based on the continued development andacquisition of our apps, as well as the sale of such apps. We either develop apps internally, or acquire third party apps or appdeveloping companies, and then resell those apps to our customers through mobile app stores. The apps must meet our stringent criteria,and we plan on only developing and acquiring apps that fit categories and platforms that already have a strong customer base..
AppYea, Inc. is redefining the current app development industryby not only developing and marketing its own apps, but also acquiring third party apps and app development companies.
Our Company generates revenue through the sale of the apps,which it either develops internally, or acquires from outside sources. Such apps are then sold in mobile app stores. The cost ofdeveloping a wide variety of apps is prohibitive for a majority of companies.
The Company will identify and address additional target categoriesand industries for its products based on market research and feedback from its customers.
Status of any publicly announced new product or service
Competition, competitive position in the industry andmethods of competition
The app development market is very competitive, with many companiesdeveloping apps worldwide. Also, it is possible that our business model may be duplicated in the future. However, at the currenttime we believe our system and business method of not only generating internal apps, but also continuously acquiring third partyapps and app development companies is unique and therefore will limit the amount of competition from our competitors, includingour competitors in the mobile app industry.
Mobile app development companies other than ours do exist. However,our business strategy and revenue generation model will allow us to obtain a large amount of apps in all categories that performon all platforms, which will separate us from our competitors. Another important difference between us and our competitors, isthat we will not only be creating and developing our own internal apps, but also will be acquiring existing apps that will be addedto our app portfolio.
Structured as a mobile app development,acquisition and management company, our business model is designed to provide an almost unlimited amount of apps that can be ofuse to a large amount of different purchasers.
Sources and availability of rawmaterials and the names of principal suppliers
The Company does not rely on any “real” raw materials.
Patents and Trademarks
The Company currently has no patents ortrademarks on its brand name and has not and does not intend to seek protection for our brand name or our mobile applications atthis time; however, as business develops and operations continue, it may seek such protection. Despite efforts to protect its proprietaryrights, such as its brand and service names, since it has no patent or trademark rights unauthorized persons may attempt to copyaspects of the Company business, including its web site design, services, product information and sales mechanics or to obtainand use information that it regards as proprietary. Any encroachment upon the Company’s proprietary information, includingthe unauthorized use of its brand name, the use of a similar name by a competing company or a lawsuit initiated against it forinfringement upon another company's proprietary information or improper use of their trademark, may affect its ability to createbrand name recognition, cause customer confusion and/or have a detrimental effect on its business. Litigation or proceedings beforethe U.S. or International Patent and Trademark Offices may be necessary in the future to enforce our intellectual property rights,to protect its trade secrets and domain name and/or to determine the validity and scope of the proprietary rights of others. Anysuch litigation or adverse proceeding could result in substantial costs and diversion of resources and could seriously harm ourbusiness operations and/or results of operations.
The Company does not require any governmentapproval for its services. As a mobile application product provider, its business will not be subject to any environmental laws.
Government and Industry Regulation
The Company will be subject to local andinternational laws and regulations that relate directly or indirectly to its operations. It will also be subject to common businessand tax rules and regulations pertaining to the operation of its business. The Company believes that the effects of existing orprobable governmental regulations will be additional responsibilities of the management of the Company to ensure that the Companyis in compliance with securities regulations as they apply to the Company’s products as well as ensuring that the companydoes not infringe on any proprietary rights of others with respect to its products. The Company will also need to maintain accuratefinancial records in order to remain complaint with securities regulations as well as any corporate tax liability it incurs.
Research and Development Activities
Other than personal timespent researching our proposed business, the Company has not spent additional funds on research and development related to itscurrent app portfolio. The Company plans on spending funds on the development of its internal apps as well as the acquisition ofthird party apps and app development companies.
Employees and Employment Agreements
With the majority of the Company's back office operational costsoutsourced and variable, AppYea, Inc. is able to maintain a small employee base focused on income producing activities. Currently,the Company has one employee, which is the Company’s sole officer and director.
The Company currently does not have anyemployment agreements with its officers or directors.
The Company is comprised of one corporation.All of our operations are conducted through this corporation.
DESCRIPTION OF PROPERTY
The Company operations are currently being conducted out ofthe Company office located at 777 Main Street, Suite 600, Fort Worth, TX 76102; (855) 927-7932. It considers that the current principaloffice space arrangement adequate and will reassess its needs based upon the future growth of the Company.
The Company is not involved in any pendinglegal proceeding nor is it aware of any pending or threatened litigation against us.
MARKET FOR COMMON EQUITY AND RELATEDSTOCKHOLDER MATTERS
No public market currently exists for sharesof the Company’s common stock. Following completion of this offering, The Company intends to apply to have its common stockquoted on the Over-the-Counter Bulletin Board.
Penny Stock Rules
The Securities and Exchange Commissionhas adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generallyequity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges orquoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securitiesis provided by the exchange or system).
A purchaser is purchasing penny stock whichlimits the ability to sell the stock. The shares offered by this prospectus constitute penny stock under the Securities and ExchangeAct. The shares will remain penny stocks for the foreseeable future. The classification of penny stock makes it more difficultfor a broker-dealer to sell the stock into a secondary market, which makes it more difficult for a purchaser to liquidate his/herinvestment. Any broker-dealer engaged by the purchaser for the purpose of selling his or her shares in us will be subject to Rules15g-1 through 15g-10 of the Securities and Exchange Act. Rather than creating a need to comply with those rules, some broker-dealerswill refuse to attempt to sell penny stock.
The penny stock rules require a broker-dealer,prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document,which:
The broker-dealer also must provide, priorto effecting any transaction in a penny stock, to the customer:
In addition, the penny stock rules requirethat prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special writtendetermination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written acknowledgmentof the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and datedcopy of a written suitability statement. These disclosure requirements will have the effect of reducing the trading activity inthe secondary market for our stock because it will be subject to these penny stock rules. Therefore, stockholders may have difficultyselling their securities.
Holders of Our Common Stock
As of the dateof this Prospectus, there are 2,299,444 shares of the Company’s common stock outstanding. The Company has 59 holders of itscommon stock.
Upon the effectiveness of the RegistrationStatement of which this Prospectus is a part, it will be subject to certain reporting requirements and will file with the SEC annualreports including annual financial statements, certified by the Company’s independent accountants, and un-audited quarterlyfinancial statements in its quarterly reports filed electronically with the SEC. All reports and information filed by the Companycan be found at the SEC website, www.sec.gov.
Stock Transfer Agent
VStock Transfer, LLC, of 77 Spruce Street,Suite 201, Cedarhurst, NY 11516, Phone: (212)-828-8436, Fax: (646)-536-3179, has been appointed as the Company’s stock transferagent.
MANAGEMENT'S DISCUSSION AND ANALYSISOR PLAN OF OPERATION
AppYea,Inc. (“AppYea”) was incorporated in the State of South Dakota on November 26, 2012 AppYea,Inc. is engaged in the acquisition, purchase, maintenance and creation of mobile software applications.
The Company operations are currently being conducted out ofthe Company office located at 777 Main Street, Suite 600, Fort Worth, TX 76102; (855) 927-7932.
Results of Operations
From our Inception on November 26, 2012through June 30, 2013 we generated $3,874 in revenue. As a result, we have very little operating history upon which to evaluateour intended business In addition, we have a history of losses.
Operating expenses, which consisted ofsales and marketing costs, legal fees, general and administrative expenses and depreciation from our Inception on November 26,2012 through June 30, 2013 were $17,337.
As a result of the foregoing, we had anet loss of $18,270 from our Inception on November 26, 2012 through June 30, 2013.
Our activities have been completely directedat the development of our internal apps, as well as the acquisition of third party apps.
The following table provides selected financialdata about the Company for the period from the date of Inception (November 26, 2013) through June 30, 2013. For detailed financialinformation, see the financial statements included in this prospectus.
If we succeed in developing customers andgenerating sufficient sales, we will become profitable. We cannot guarantee that this will ever occur. Our plan is to operateein a manner which will be successful. Tthe Company will need to obtain further capital through the sale of its common stock tocontinue its operations in addition to its current revenue stream.
In its audited financial statements asof June 30, 2013, the Company was issued an opinion by its auditors that raised substantial doubt about the ability to continueas a going concern based on the company’s current financial position.
Immediate Plan of Operation:
At present management will concentrateon the completion of the Registration Statement while concurrently continuing to expand its app portfolio and customer base whilecontinuing to develop and promote its internal apps.
Continuing Plan of Operation (0-12months):
Begin Marketing and Sales efforts:
The Company marketing efforts will primarily be related to assuringits products are easily found in app stores and create a smooth downloading experience. A significant opportunity exists for thedevelopment and acquisition of mobile apps that function on all currently available platforms. The continuing plan of theCompany’s operations will be to continue internal app development as well as outside app acquisition, which the Company believeswill also expand its customer base and revenue stream.
The Company will continue to develop andadd to its customer base through marketing of its current app portfolio, while also adding additional apps through acquisitionsof third party apps and app development companies. The goal for the Company in the next twelve months is to further develop andexpand its app portfolio, through internal development and outside acquisitions.
Liquidity and capital resources
As of June 30, 2013, we had cash or cash equivalents of $31,150.
Net cash used in operating activities was $4,303 for periodfrom Inception on November 26, 2012 through June 30, 2013. We believe that our revenues will increase due to the sales of our productsand, together with our existing cash balance, may be sufficient to meet our operating requirements for the next twelve. If ourrevenue growth is not sufficient to allow us to meet our cash requirements during the next twelve months, the Company will needto raise additional funds through the sale of its equity securities.
Cash flows used in investing activities was $52,175 for periodfrom Inception on November 26, 2012 through June 30, 2013. We do not anticipate significant cash outlays for investing activitiesover the next 12 months, however, if our revenue stream is not sufficient for us to purchase apps without raising additional funds,we may need to sell additional securities in order to meet our business goals over the next twelve months.
Cash flows provided by financing activities was $79,022 forperiod from Inception on November 26, 2012 through June 30, 2013. Cash flows provided by financing activities include $119,922from the issuance of common stock for cash and $500 from the issuance of our preferred stock for cash.
As of June 30, 2013, our total assets were$162,496 and our total liabilities were $30,344. Included in our assets of as of June 30, 2013 was $31,150 of cash, $2,331 of accountsreceivable, and fixed assets of $108,416. We hope to be able to conduct our planned operations for a minimum of twelve months usingthe revenue we are generating as well as currently available capital resources.
Our principal source of liquidity will be the revenue generatedfrom our operations. We are generating revenue and we believe our revenue will continue to increase, and while we are currentlyoperating at a loss, we believe that our revenue stream will be a sufficient source of liquidity for us. If we do not generatea sufficient amount of revenue, we may need to raise additional funds through the sale of our equity securities. We expect variationin revenues to account for the difference between a profit and a loss. Also business activity is closely tied to the U.S. economy.Our ability to achieve and maintain profitability and positive cash flow is dependent upon our ability to successfully continueto develop our products and our ability to generate revenues.
In any case, we try to operate with minimaloverhead. Our primary activity will be to seek to develop customers for our products and, consequently, our sales. If we succeedin developing clients for our services and generating sufficient sales, we will become profitable. We cannot guarantee that thiswill ever occur. Our plan is to build our company in any manner which will be successful.
Off-Balance Sheet Arrangements
The Company does not have any off-balancesheet arrangements that have or are reasonably likely to have a current or future effect on its financial condition, changes infinancial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that ismaterial to investors.
The Company records revenue on the accrualbasis when all goods and services have been performed and delivered, the amounts are readily determinable, and collection is reasonablyassured. The Company has generated revenue of $3,874 since its Inception on November 26, 2012 through June 30, 2013.
CHANGES IN AND DISAGREEMENTS WITHACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERSAND CONTROL PERSONS
Directors of the Company are elected bythe stockholders to a term of one year and serve until their successors are elected and qualified. Officers of the Company areappointed by the Board of Directors to a term of one year and serve until their successors are duly appointed and qualified, oruntil the officer is removed from office. The Board of Directors has no nominating, auditing or compensation committees.
The name, address, age and position ofthe company officer and director is set forth below:
The persons named above are expected tohold said offices/positions until the next annual meeting of our stockholders. The persons named above are the company’sonly officers, directors, promoters and control persons. Below is the business experience of each above listed individual duringat least the last five years:
Background Information about OurOfficers and Directors
Jackie D.Williams, is President/Chairman and a native Texan.He is an experienced business owner, entrepreneur & successful sales management executive. He began his career at a young ageas a Route-Sales Executive in the wholesale floral industry for one of the largest wholesalers in the United States. He flourishedas a Route-Sales executive and was consistently a Top 10 Sales Executive. In 1999 he was named TOP 5 Sales Executive Sales Manager.In 2007 he was named Branch Manager where his store has consistently been one of the Top performing stores in the in the nation.Mr. Williams has over 21 years of experience in management. Since November 26, 2012, Mr. Williams has been acting as sole directorsand President of Appyea, Inc. Mr. Williams has no other employment history other than detailed herein in the past five years.
The Company does not have a compensationcommittee and it does not have an audit committee financial expert. It does not have a compensation committee because its Boardof Directors consists of only one director and there is no compensation at this time. There is no independent audit committee financialexpert because it is believed the cost related to retaining a financial expert at this time is prohibitive in the circumstancesof the Company. Further, because there are no operations, at the present time, it is believed the services of a financial expertare not warranted.
Conflicts of Interest
The Company does not currently foreseeany conflict of interest.
Currently, the company directors and officersreceive no cash compensation for their services. Our officers and directors are reimbursed for any out-of-pocket expenses thatthey incur on its behalf.
In the future, the Company may approvepayment of salaries for officers and directors. The Company also does not currently offer or have any benefits, such as healthor life insurance, available to its employees.
Option Grants. No option grantshave been exercised by the executive officers named in the Summary Compensation Table. The Company does not currently have anystock option plans in place.
Aggregated Option Exercises and FiscalYear-End Option Value. There have been no stock options exercised by the executive officers named in the Summary CompensationTable.
Long-Term Incentive Plan (“LTIP”)Awards. There have been no awards made to a named executive officers in the last completed fiscal year under any LTIP.
Compensation of Directors
Directors are permitted to receive fixedfees and other compensation for their services as directors. The Board of Directors has the authority to fix the compensation ofdirectors. No amounts have been paid to, or accrued to, our director in such capacity.
The Company does not have any employmentcontracts with its officers or directors.
SECURITY OWNERSHIP OF CERTAIN BENEFICIALOWNERS AND MANAGEMENT
The following table sets forth, as of thedate of this prospectus, the total number of shares owned beneficially by the Company directors, officers and key employees, individuallyand as a group, and the present owners of 5% or more of its total outstanding shares. The table also reflects what the percentageof ownership will be assuming completion of the sale of all shares in this offering, which cannot be guaranteed The stockholderslisted below have direct ownership of their shares and possesses sole voting and dispositive power with respect to the shares.
(1) All ownership is beneficial and ofrecord, unless indicated otherwise based on 2,299,444 shares outstanding as of the date of this Prospectus. The selling stockholdersare under no obligation known to the Company to sell any shares of common stock at this time.
(2) The Beneficial owner has sole votingand investment power with respect to the shares shown.
(3) Assumes the sale of all shares of commonstock registered pursuant to this Prospectus. The selling stockholders are under no obligation known to us to sell any shares ofcommon stock at this time.
(1) The Company is authorized to issue5,000,000 shares of convertible preferred stock at a par value of $0.0001.
A convertible preferred share is convertibleinto 100 shares of common stock and has the voting rights of 1,000 share of common stock. As at June 30, 2013, 5,000,000 sharesof the Company’s convertible preferred stock were issued and outstanding.
(2) The Beneficial owner has sole voting and investment powerwith respect to the shares shown.
Future Sales by Principal Stockholders
A total of 1,600,000 common shares and5,000,000 preferred shares have been issued to the company officers and directors and are restricted securities, as that term isdefined in Rule 144 of the Rules and Regulations of the SEC promulgated under the Act. Under Rule 144, such shares can be publiclysold, subject to volume restrictions and certain restrictions on the manner of sale, commencing six months after their acquisition.Any sale of these shares (after applicable restrictions expire) may have a depressive effect on the price of our common stock inany market that may develop, of which there can be no assurance. The principal stockholders do not have any plans to sell theirshares at any time after this offering is complete.
TRANSACTIONS WITH RELATED PERSONS,
PROMOTERS AND CERTAIN CONTROL PERSONS
Asof June 30, 2013, the Company had aggregate loans payable outstanding to shareholders and officers of $19,000.
There are not currently any conflicts ofinterest by or among its current officers, directors, key employees or advisors. The Company has not yet formulated a policy forhandling conflicts of interest; however, it intends to do so upon completion of this offering and, in any event, prior to hiringany additional employees.
Insofar as indemnification for liabilities arising under theSecurities Act of 1933 (the “Act”) may be permitted to directors, officers and controlling persons of the small businessissuer pursuant to the By-Laws of the company, or otherwise, we have been advised that in the opinion of the Securities and ExchangeCommission such indemnification is against public policy as expressed in the Act, and is, therefore unenforceable.
In the event that a claim for indemnification against such liabilities(other than the payment of expenses incurred or paid by a director, officer or controlling person in the successful defense ofany action, suit or proceeding) is asserted by such director, officer, or other control person in connection with the securitiesbeing registered, we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submitto a court of appropriate jurisdiction the question whether such indemnification by it, is against public policy as expressed inthe Securities Act and will be governed by the final adjudication of such issue.
We are not obligated to pay any of the expenses of any attorneyor other advisor engaged by a selling stockholder. We have not agreed to indemnify any selling stockholders againstlosses, claims, damages and liabilities, including liabilities under the Securities Act.
The Company has filed a registration statementon Form S-1, of which this prospectus is a part, with the U.S. Securities and Exchange Commission (the “SEC”). Uponthe effectiveness of this registration statement, we will become subject to the informational requirements of the Exchange Actand, in accordance therewith, will file all requisite reports, such as Forms 10-K, 10-Q and 8-K, proxy statements, under Sec.14of the Exchange Act, and other information as required. Such reports, proxy statements, this registration statement and other information,may be inspected and copied at the public reference facilities maintained by the SEC at 100 F Street NE, Washington, D.C. 20549.Copies of all materials may be obtained from the Public Reference Section of the SEC’s Washington, D.C. office at prescribedrates. You may obtain information regarding the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. TheSEC also maintains an internet site that contains reports, proxy and information statements and other information regarding registrantsthat file electronically with the SEC at http://www.sec.gov. The Company will voluntarily provide electronic or paper copies ofits filings with the SEC free of charge upon request.
The Company’s fiscal year end isJune 30th. The Company will provide audited financial statements to its stockholders on an annual basis; the statementswill be prepared and then will be audited by the independent PCAOB registered CPA firm Cutler & Co., LLC. The financial statementsof the Company, commencing on page 1 are included with this prospectus. These financial statements have been prepared on the basisof accounting principles generally accepted in the United States and are expressed in US Dollars. The financial information presentedis for the period from Inception (November 26, 2012) through June 30, 2013.
AUDITED FINANCIAL STATEMENTS
FOR THE PERIOD
FROM INCEPTION (NOVEMBER 26, 2012) TOJUNE 30, 2013
INDEX TO AUDITED FINANCIAL STATEMENTS
REPORT OF INDEPENDENT REGISTERED PUBLICACCOUNTING FIRM
To the Directors of
Fort Worth, Texas
We have audited the accompanying balancesheets of AppYea, Inc. (a development stage company) as of June 30, 2013, and the related statement of operations, changes in stockholders'equity and cash flows for the period from Inception (November 26, 2012) to June 30, 2013. These financial statements are the responsibilityof 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 withauditing standards generally accepted in the United States of America. Those standards require that we plan and perform the auditsto obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining,on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessingthe accounting principles used and significant estimates made by management, as well as evaluating the overall financial statementpresentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statementsreferred to above present fairly, in all material respects, the financial position of AppYea, Inc. as of June 30, 2013 and theresults of its operations and its cash flows for the period from Inception (November 26, 2012) to June 30, 2013 in conformity withaccounting principles generally accepted in the United States of America.
The accompanying financial statements havebeen prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements theCompany has suffered losses from operations since Inception (November 26, 2012) and currently does not have sufficient availablefunding to fully implement its business plan. These factors raise substantial doubt about its ability to continue as a going concern.Management's plans in regard to these matters are also described in Note 3. The financial statements do not include any adjustmentsthat might result from the outcome of this uncertainty.
August 28, 2013
2460West 26th Avenue, Suite 380C, Denver, Colorado 80211 • Phone: 303.968.3281 • Fax: 303.463.5416 • www.cutlerandcocpas.com
Registered as a US public accounting firmin the State of Colorado; license number FRM-13300.
Registered to carry out audit work in theUK by the Institute of Chartered Accountants in England and Wales; Reference number C002850898
(A Development-Stage Company)
See Accompanying Notes to Audited FinancialStatements
STATEMENT OF OPERATIONS
STATEMENT OF CHANGES IN STOCKHOLDERS'EQUITY
Period from Inception (November 26, 2012)through June 30, 2013
STATEMENTS OF CASH FLOWS
App Yea, Inc.
NOTES TO AUDITED FINANCIAL STATEMENTS
(A Development Stage Company)
June 30, 2013
1. NATURE OF OPERATIONS
AppYea, Inc. (“AppYea”,“the Company”, “we” or “us”) was incorporated in the State of South Dakota on November 26,2012 to engage in the acquisition, purchase, maintenance and creation of mobile software applications. The Company is in the developmentstage with no significant revenues and a limited operating history.
Acquisition of a Portfolio of 13 AwardWinning Gaming Mobile Applications
Total consideration for the acquisitionwas $68,500. Of this total consideration, $28,500 was paid in cash at closing, $20,000 through the issuance of 40,000 shares ofits common stock and $20,000 was payable under a 12 month convertible promissory note payable.
The convertible promissory note was repaidin full in April 2013.
The entire purchase consideration has beenallocated to the software cost of the mobile application and is being amortized over an estimated useful life of 36 months.
Acquisition of StreaMe Streaming MediaServer Application
On March 5, 2013, the Company acquiredthe StreaMe streaming media server application.
StreaMe is the only iOS streaming mediaserver that allows users to create their own personal broadcast stream directly from their own iOS device.
Total consideration for the acquisitionwas $800, paid in cash at closing.
The entire purchase consideration has beenallocated to the software cost of the mobile application and will be amortized over an estimated useful life of 36 months oncethe product is made available for sale.
Acquisition of Disney Maps Mobile Application
On April 2, 2013 the Company acquired aunique mobile application that will help the millions of Disney and Universal visitors by providing them with accurate attractionwait times, ride information, theme park maps, hours of park operation, parade and show times, firework times, and much more inthe palms of millions of iPhone users' hands. Currently, these features are available for Disney World's Magic Kingdom ®, Epcot®,Disney's Hollywood Studios®, and Disney's Animal Kingdom®.
Total consideration for the acquisitionwas $52,176, Of this total consideration, $22,176 was paid in cash at closing, $15,000 was to be paid on a deferred basis at arate of 20% of the net receipts from the Disney Map mobile application and $15,000 was payable under a 12 month convertible promissorynote payable.
On May 24, 2013, $10,000 of the $15,000deferred purchase consideration payable at a rate of 20% of the net receipts from the Disney Map mobile application was convertedinto 20,000 shares of the Company’s common stock.
On May 24, 2013, $1,000 of the remaining$5,000 deferred purchase consideration payable at a rate of 20% of the net receipts from the Disney Map mobile application wasrepaid in cash.
2. SUMMARY OF SIGNIFICANTACCOUNTING POLICIES
Basis of Presentation
The financial statements of the Companyhave been prepared in accordance with generally accepted accounting principles in the United States of America and are presentedin US dollars. The Company’s year -end is June 30.
Use of Estimates and Assumptions
The preparation of financial statementsin conformity with generally accepted accounting principles requires that management makes estimates and assumptions that affectthe reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financialstatements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.
Development Stage Company
The Company is a development stage enterprisein accordance with ACS 915 "Development Stage Entities." We have been in the development stage since Inception (November26, 2012). Among the disclosures required as a development stage company are that its financial statements are identified as thoseof a development stage company, and that the statements of operations, stockholders' deficit and cash flows disclose activity sincethe date of its Inception (November 26, 2012) as a development stage company.
Cash and Cash Equivalents
The Company considers all highly liquidinvestments with original maturity of three months or less to be cash equivalents.
The Company’s fixed assets representmobile applications that is has purchased and upgrades that it has made to these applications. These mobile applications and anyupgrades are being amortized over their useful lives of 3 years.
Offering costs with respect to issue ofcommon stock, warrants or options by the Company are initially deferred and ultimately offset against the proceeds from these equitytransactions if successful or expensed if the proposed equity transaction is unsuccessful. The Company recognized $20,400 in deferredoffering costs in Other Assets at June 30, 2013.
Fair value measurements are determinedbased on the assumptions that market participants would use in pricing an asset or liability. ASC 820-10 establishesa hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservableinputs by requiring that the most observable inputs be used when available. FASB ASC 820 establishes a fair value hierarchy thatprioritizes the use of inputs used in valuation methodologies into the following three levels:
Level 1: Quoted prices (unadjusted) foridentical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fairvalue and must be used to measure fair value whenever available.
Level 2: Significant other observable inputsother than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active;or other inputs that are observable or can be corroborated by observable market data.
Level 3: Significant unobservable inputsthat reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing anasset or liability. For example, level 3 inputs would relate to forecasts of future earnings and cash flows used in a discountedfuture cash flows method.
The carrying values of accounts receivable,prepaid expenses, accounts payable, accruals and convertible notes payable approximate their fair value due to the short-term maturitiesof these instruments.
Research and Development Costs
Costs incurred in research and developmentactivities are expensed as incurred.
Advertising costs were expensed as incurred.Advertising costs of $1,086 were incurred in the period from Inception (November 26, 2012) to June 30, 2013.
Comprehensive Income (Loss)
Comprehensive income is defined as allchanges in stockholders' equity (deficit), exclusive of transactions with owners, such as capital investments. Comprehensive incomeincludes net income or loss, changes in certain assets and liabilities that are reported directly in equity such as translationadjustments on investments in foreign subsidiaries and unrealized gains (losses) on available-for-sale securities. From the Company’sInception there were no differences between its comprehensive loss and net loss.
The Company accounts for income taxes inaccordance with FASB ASC 740 “Income Taxes”. Under FASB ASC 740, deferred income taxes are recognized for the tax consequencesin future years of differences between the tax bases of assets and liabilities and their financial statement reported amounts ateach period end, based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expectedto affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expectedto be realized. The provision for income taxes represents the tax expense for the period, if any, and the change during the periodin deferred tax assets and liabilities. FASB ASC 740 also provides criteria for the recognition, measurement, presentation anddisclosure of uncertain tax positions. Under FASB ASC 740, the impact of an uncertain tax position on the income tax return mayonly be recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority.At June 30, 2013, a full deferred tax asset valuation allowance has been provided and no deferred tax asset has been recorded.
Basic and Diluted Net Income (Loss) per Share
The Company computes net income (loss)per share in accordance with ASC 260, "Earnings per Share" which requires presentation of both basic and diluted earningsper share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders(numerator) by the weighted average number of common shares outstanding (denominator) during the period. Diluted EPS gives effectto all dilutive potential common shares outstanding during the period including stock options, using the treasury stock method,and convertible preferred stock, using the if-converted method. In computing diluted EPS, the average stock price for the periodis used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPSexcludes all dilutive potential common shares if their effect is anti-dilutive. During the period Inception (November 26, 2012)to June 30, 2013, there were shares of convertible preferred stock outstanding and conversion privileges attached to convertiblepromissory notes payable. The common share equivalents of these securities have not been included in the calculations ofloss per share because such inclusions would have an anti-dilutive effect as the Company has incurred losses in the period Inception(November 26, 2012) to June 30, 2013.
The Company believes that its activitiesduring the period Inception (November 26, 2012) to June 30, 2013 comprised a single segment.
Recent Accounting Pronouncements
The Company has reviewed all recently issued,but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expectedto cause a material impact on its financial condition or the results of its operations.
3. GOING CONCERN AND LIQUIDITY
At June 30, 2013 the Company had cash of$31,150, no profitable business activities or other source of income, liabilities of $30,344 and have incurred losses since Inception(November 26, 2012).
The Company anticipates future losses inthe development of its business.
In our financial statements for the periodInception (November 26, 2012) to June 30, 2013, the Report of the Independent Registered Public Accounting Firm includes an explanatoryparagraph that describes substantial doubt about our ability to continue as a going concern.
The Company’s ability to continueas a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessaryfinancing to meet its obligations and repay its liabilities arising from normal business operations when they come due. There isno assurance that this series of events will be satisfactorily completed.
The financial statements do not includeany adjustments that might be necessary if the Company is unable to continue as a going concern.
4. FIXED ASSETS
As at June 30, 2013, the balance of fixedassets represented mobile application software as follows:
Depreciation expense for the period Inception (November 26,2012) to June 30, 2013 was $13,795.
5. LOANS – RELATED PARTIES
On February 1, 2013, as part of its acquisitionof a portfolio of 13 award winning iOS kid friendly gaming mobile applications, the Company issued a$20,000 convertible promissory note payable. The convertible promissory note payable was for a term of 12 months and carried aninterest rate of 12% per annum. The note payable was convertible at the option of the holder, once the Company became publiclyquoted, at a 50% discount to the lowest closing bid price for the Company’s common stock during the 20 trading days immediatelypreceding the conversion date. The Company recorded no beneficial conversion expense on the conversion feature as the specificconversion price is currently not determinable. In April 2013 the convertible promissory note payable was repaid in full.
On April 2, 2013 as part of its acquisitionof the Disney Maps mobile application, the Company agreed to pay $15,000 on a deferred basis at a rateof 20% of the net receipts from the Disney Map mobile application and issued a $15,000 convertible promissory note payable. Theconvertible promissory note payable was for a term of 12 months and carried an interest rate of 12% per annum. The note payablewas convertible at the option of the holder, once the Company became publicly quoted, at a 50% discount to the lowest closing bidprice for the Company’s common stock during the 20 trading days immediately preceding the conversion date. The Company recordedno beneficial conversion expense on the conversion feature as the specific conversion price is currently not determinable
On May 29, 2013 $1,000 o the remaining$5,000 deferred purchase consideration payable at a rate of 20% of the net receipts from the Disney Map mobile application wasrepaid in cash.
As at June 30, 2013, interest of $933 hadbeen accrued on these borrowings.
6. COMMITMENTS AND CONTINGENCIES
Leases and Long term Contracts
The Company has not entered into any longterm leases, contracts or commitments.
To the best of the Company’s knowledgeand belief, no legal proceedings are currently pending or threatened.
7. SHAREHOLDERS’ EQUITY
Convertible Preferred Stock
The Company is authorized to issue 5,000,000shares of convertible preferred stock at a par value of $0.0001.
A convertible preferred share is convertibleinto 100 shares of common stock and has the voting rights of 1,000 share of common stock.
In November 2012, the Company issued 5,000,000shares of its convertible preferred stock for cash consideration of $500 as Founder’s Stock.
As at June 30, 2013, 5,000,000 shares ofthe Company’s convertible preferred stock were issued and outstanding.
The Company is authorized to issue 750,000,000shares of common stock at a par value of $0.0001.
In November 2012, the Company issued 2,000,000shares of its common stock for cash consideration of $200 as Founder’s Stock.
In February 2013, the Company issued 40,000shares of its common stock, valued at $0.50 per share, as partial consideration for the acquisition of a portfolio of 13 awardwinning gaming mobile applications.
In February 2013, the Company issued 57,000shares of its common stock, at $0.50 per share, to 13 investors, for cash consideration of $28,500.
In March 2013, the Company issued 59,000share of its common stock, at $0.50 per share, to 14 investors, for cash consideration of $29,500.
In April 2013, the Company issued 20,000share of its common stock, at $0.50 per share in settlement of $10,000 of the deferred purchase consideration due in respect ofits purchase of the Disney Map mobile application
In April 2013, the Company issued 113,444shares of its common stock, at $0.50 per share, to 19 investors, for cash consideration of $56,722.
In May 2013, the Company issued 8,000 shareof its common stock, at $0.50 per share, to 3 investors, for cash consideration of $4,000.
In June 2013, the Company issued 2,000share of its common stock, at $0.50 per share, to 1 investor, for cash consideration of $1,000.
As at June 30, 2013, 2,299,444 shares ofthe Company’s common stock were issued and outstanding.
8. RELATED PARTY TRANSACTIONS
The President of the Company provides managementand office premises to the Company for no compensation.
9. INCOME TAXES
The Company follows ASC 740. Deferred incometaxes reflect the net effect of (a) temporary difference between carrying amounts of assets and liabilities for financial purposesand the amounts used for income tax reporting purposes, and (b) net operating loss carry-forwards. No net provision for refundableFederal income tax has been made in the accompanying statement of loss because no recoverable taxes were paid previously. Similarly,no deferred tax asset attributable to the net operating loss carry-forward has been recognized, as it is not deemed likely to berealized.
The provision for refundable federal incometax consists of the following for the periods ending:
The cumulative tax effect at the expected rate of 34% of significantitems comprising our net deferred tax amount is as follows:
At June30, 2013 the Company had an unusednet operating loss carry-forward approximating $18,270 that is available to offset future taxable income; the loss carry-forwardwill start to expire in 2033.
10. SUBSEQUENT EVENTS
On July 23, 2013, $500 of the remaining$4,000 deferred purchase consideration payable at a rate of 20% of the net receipts from the Disney Map mobile application wasrepaid in cash.
The Company has evaluated subsequent eventsthrough the date of the issuance of these audited financial statements and other than as disclosed above, the Company did not haveany material recognizable subsequent events.
Dealer Prospectus Delivery Obligation
“Until the date that is 180 daysafter the effective date of this Prospectus, all dealers that effect transactions in these securities, whether or not participatingin this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectuswhen acting as underwriters and with respect to their unsold allotments or subscriptions.”
PART II - INFORMATION NOT REQUIREDIN PROSPECTUS
Item 13. Other expenses of issuanceand distribution.
Expenses incurred or expected relatingto this Prospectus and distribution, all of which the Company will pay, are calculated on a net basis and are as follows:
Item 14. Indemnification of directorsand officers.
Pursuant to the Company’s Articles of Incorporation, Nodirector shall have personal liability to the Corporation or its stockholders for monetary damages for breach of fiduciary dutyas a director, provided that this Article not eliminate or limit the liability of a director (i) for any breach of the director’sduty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentionalmisconduct or a knowing violation of law, (iii) under Section 174 of Title 8 of the Delaware Code (iv) for any transaction fromwhich the director derived an improper personal benefit.
Item 15. Recent sales of unregisteredsecurities.
Set forth below is information regardingthe issuance and sales of securities without registration since inception. No such sales involved the use of an underwriter; noadvertising or public solicitation was involved; the securities bear a restrictive legend; and no commissions were paid in connectionwith the sale of any securities.
In November 2012, the Company issued 5,000,000shares of its convertible preferred stock for cash consideration of $500 to Jackie Williams as Founder’s Stock.
On November 19, 2012, the Company issued40,000 founder’s shares to Edouard Prous at a price of $0.0001 per share.
On November 19, 2012, the Company issued40,000 founder’s shares to Jack Williams Sr. at a price of $0.0001 per share.
On November 19, 2012, the Company issued40,000 founder’s shares to Zachary Williams at a price of $0.0001 per share.
On November 19, 2012, the Company issued40,000 founder’s shares to Jeff Young at a price of $0.0001 per share.
On November 19, 2012, the Company issued30,000 founder’s shares to Dewayne Horton at a price of $0.0001 per share.
On November 19, 2012, the Company issued40,000 founder’s shares to Peter Dunne at a price of $0.0001 per share.
On November 19, 2012, the Company issued40,000 founder’s shares to Patrick O’Neal at a price of $0.0001 per share.
On November 19, 2012, the Company issued30,000 founder’s shares to Chris Addison at a price of $0.0001 per share.
On November 19, 2012, the Company issued40,000 founder’s shares to Jason Lehmann at a price of $0.0001 per share.
On November 19, 2012, the Company issued30,000 founder’s shares to Wes Shook at a price of $0.0001 per share.
On November 19, 2012, the Company issued30,000 founder’s shares to Rick Reese at a price of $0.0001 per share.
The securities listed in this Item 15 wereissued in reliance upon an exemption provided by Section 4(2) promulgated under the Securities Act of 1933, as well as RegulationD, Rule 505. The certificates for these securities bear a restrictive legend.
Item 16. Exhibits.
The following exhibits are included withthis registration statement:
Item 17. Undertakings.
(A) The undersigned Registrant hereby undertakes:
(1) To file, during any period in whichoffers or sales are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus requiredby section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any factsor events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof)which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement.Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securitiesoffered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offeringrange may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) (§230.424(b) of this chapter)if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering priceset forth in the “Calculation of Registration Fee” table in the effective registration statement.
(iii) To include any material informationwith respect to the plan of distribution not previously disclosed in the registration statement or any material change to suchinformation in the registration statement;
(2) That, for the purpose of determiningany liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statementrelating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initialbona fide offering thereof.
(3) To remove from registration by meansof a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(B) Insofar as indemnification for liabilitiesarising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant tothe foregoing provisions, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission suchindemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In theevent that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurredor paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding)is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unlessin the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdictionthe question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governedby the final adjudication of such issue.
(C) That, for the purpose of determiningliability under the Securities Act of 1933 to any purchaser:
(i) each prospectus filed pursuant to Rule424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B orother than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statementas of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statementor prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by referenceinto the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time ofcontract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectusthat was part of the registration statement or made in any such document immediately prior to such date of first use.
(6) That, for the purpose of determiningliability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:
The undersigned registrant undertakes thatin a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwritingmethod used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any ofthe following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sellsuch securities to such purchaser:
(i) Any preliminary prospectus or prospectusof the undersigned registrant related to the offering required to be filed pursuant to Rule 424;
(ii) Any free writing prospectus relatingto the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
(iii) The portion of any other free writingprospectus relating to the offering containing material information about the undersigned registrant or its securities providedby or on behalf of the undersigned registrant; and
(iv) Any other communication that is anoffer in the offering made by the undersigned registrant to the purchaser.
In accordance with the requirements ofthe Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned,thereunto duly authorized, in the city of Forth Worth, Texas, on September 5, 2013.
Pursuant to the requirements of the SecuritiesAct of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.