-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GmjkAvYyFyY7RaSY0RUU8YeuZA+lKDTQGMZfHFX2An2huz4QFyn3G/S1Hs3hJ6YW iA5/BqbBdzTiLdbUW7LjvQ== 0001072588-10-000249.txt : 20100820 0001072588-10-000249.hdr.sgml : 20100820 20100820162251 ACCESSION NUMBER: 0001072588-10-000249 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20100731 FILED AS OF DATE: 20100820 DATE AS OF CHANGE: 20100820 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MEDINA INTERNATIONAL HOLDINGS, INC. CENTRAL INDEX KEY: 0001093248 STANDARD INDUSTRIAL CLASSIFICATION: SHIP & BOAT BUILDING & REPAIRING [3730] IRS NUMBER: 841469319 STATE OF INCORPORATION: CO FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-27211 FILM NUMBER: 101030424 BUSINESS ADDRESS: STREET 1: 10088 6TH STREET STREET 2: SUITE G CITY: RANCHO CUCAMONGA STATE: CA ZIP: 91730 BUSINESS PHONE: 3034228127 MAIL ADDRESS: STREET 1: 10088 6TH STREET STREET 2: SUITE G CITY: RANCHO CUCAMONGA STATE: CA ZIP: 91730 FORMER COMPANY: FORMER CONFORMED NAME: COLORADO COMMUNITY BRAODCASTING INC DATE OF NAME CHANGE: 19990813 10-Q 1 mihi10q.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ----------------- FORM 10Q ----------------- (Mark One) [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended July 31, 2010 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the transition period from __________ to ___________ Commission file number : 000-27211 MEDINA INTERNATIONAL HOLDINGS, INC. ------------------------------------------------------- (Exact name of registrant as specified in its charter) COLORADO 84-1469319 ---------------------------------- -------------------- (State of Incorporation) (IRS Employer ID Number) 1802 Pomona Rd., Corona, CA 92880 ----------------------------------------------- (Address of principal executive offices) 909-522-4414 -------------------------- (Registrant's Telephone number) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to the filing requirements for the past 90 days. Yes [X] No [ ] Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ ] No [] Indicate by check mark whether the registrant is a large accelerated file, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [ ] (Do not check if a smaller reporting company) Smaller reporting company [X] Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [ X] Indicate the number of share outstanding of each of the issuer's classes of common stock, as of the latest practicable date. As of August 1, 2010, there were 51,006,747 shares of the registrant's common stock issued and outstanding.
Page ---- PART I - FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) ---- Report of Independent Registered Public Accounting Firm F-1 Consolidated Balance Sheets - July 31, 2010 and April 30, 2010 F-2 Consolidated Statements of Operations - Three months ended July 31, 2010 and 2009 F-3 Statements of Cash Flows - Three months ended July 31, 2010 and 2009 F-4 Statement of Changes in Stockholders' Equity (Deficit) F-5 Notes to Consolidated Financial Statements F-6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 1 Item 3. Quantitative and Qualitative Disclosures About Market Risk - Not Applicable Item 4. Controls and Procedures 3 Item 4T. Controls and Procedures 4 PART II - OTHER INFORMATION Item 1. Legal Proceedings -Not Applicable 4 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 5 -Not Applicable Item 3. Defaults Upon Senior Securities - Not Applicable 5 Item 4. Rescinded and Removed 5 Item 5. Other Information - Not Applicable 5 Item 6. Exhibits 5 SIGNATURES 6
PART I. - FINANCIAL INFORMATION
MEDINA INTERNATIONAL HOLDINGS, INC. AND SUBSIDIARIES Consolidated Balance Sheets July 31, April 30, 2010 2010 (Unaudited) (Audited) --------------- ---------------- ASSETS Current Assets: Cash $ 10,631 $ 107,223 Receivables 62,283 62,283 Inventory 136,081 164,652 Other receivables 465 465 --------------- ---------------- Total current assets 209,460 334,623 Fixed Assets: 1,065,055 1,065,055 Accumulated depreciation (400,469) (361,207) --------------- ---------------- Total fixed assets 664,586 703,848 Other Assets: Deposits 18,770 8,249 --------------- ---------------- Total other assets 18,770 8,249 --------------- ---------------- TOTAL ASSETS $ 892,816 $ 1,046,720 =============== ================ LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) Current liabilities: Accounts payable $ 588,793 $ 640,056 Accrued liabilities 212,596 186,075 Bank Overdraft 94,932 94,932 Short term deposit 111,673 119,825 Customer Deposit 243,300 308,000 Stock subscription payable 1,250 - Notes payable 75,000 104,000 Related party payable 863,339 870,941 Related Parties - short-term borrowings from shareholders 418,768 407,217 --------------- ---------------- Total current liabilities 2,609,651 2,731,046 --------------- ---------------- Stockholders' equity (deficit): Preferred stock, $.01 par value, 10,000,000 shares authorized Series A preferred stock, $0.01 par value, 50 shares authorized, 20 shares issued and outstanding 240,000 240,000 Common stock, $.0001 par value, 100,000,000 shares authorized, 51,006,747 and 51,006,747 shares issued and outstanding on July 31, 2010 and April 30, 2010 5,100 5,100 Additional paid-in capital 3,513,928 3,513,928 Accumulated deficit (5,475,863) (5,443,354) --------------- ---------------- Total stockholders' equity (deficit) (1,716,835) (1,684,326) --------------- ---------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) $ 892,816 $ 1,046,720 =============== ================ The accompanying notes are an integral part of these financial statements. F-1
Medina International Holdings, Inc. and Subsidiaries Consolidated Statements of Operations (Unaudited) For the Three Months Ended July 31, 2010 2009 ----------------- ------------------- Sales, net $ 488,260 $ 870 Cost of Goods Sold 355,264 64,229 ----------------- ------------------- Gross Profit 132,996 (63,359) ----------------- ------------------- General and administrative expenses 102,366 120,824 Selling and marketing expenses 53,131 287 Research and development expenses - 1,370 ----------------- ------------------- Loss from operations (22,501) (185,840) ----------------- ------------------- Other income - (843) Interest expense 10,008 26,055 ----------------- ------------------- Net other income (10,008) (25,212) ----------------- ------------------- Loss before income tax (expense) benefit (32,509) (211,052) Income tax (expense) benefit - - ----------------- ------------------- Net Loss from Operations $ (32,509) $ (211,052) ================= =================== Net loss per share: Basic $ (0.0006) $ (0.0041) ================= =================== Diluted $ (0.0006) $ (0.0041) ================= =================== Weighted average number of shares outstanding: Basic 51,006,747 51,006,747 ================= =================== Diluted 51,006,747 51,006,747 ================= =================== The accompanying notes are an integral part of these financial statements. F-2
Medina International Holdings, Inc. and Subsidiaries Consolidated Statements of Shareholders' Equity As of July 31, 2010 (Unaudited) Additional Common Common Stock Preferred Stock Paid-In Stock Subscription Accumulated Shares Amount Shares Amount Capital Subscribed Receivable Deficit Totals ----------- --------- ------ ---------- ------------ --------------------------------- ---------- Balance - April 30, 2009 35,560,091 $ 3,556 - $ - $ 2,419,032 $10,000 $ (3,000)$(4,698,284) $(2,268,696) Stock issued for subscription payable 20 240,000 240,000 Stock issued to Directors 50,000 5 3,157 3,162 Stock issued for subscription payable 11,091,250 1,109 661,629 662,738 Stock issued for accrued liabilities 4,135,000 413 413,087 413,500 Shares issued for rent 70,406 7 7,033 7,040 Stock subscription receivable 100,000 10 9,990 (10,000) 3,000 (3,000) - Net loss (742,070) (742,070) --------------------- --------------------------------------------------------------------------- Balance - April 30, 2010 51,006,747 5,100 20 240,000 3,513,928 - - (5,443,354) (1,684,326) ------------------------------------------------------------------------------------------------- Net loss (32,509) (32,509) --------------------- --------------------------------------------------------------------------- Balance - July 31, 2010 51,006,747 $ 5,100 20 $240,000 $ 3,513,928 $ - $ - $(5,475,863) $(1,716,835) ===================== =========================================================================== The accompanying notes are an integral part of the financial statements F-3
MEDINA INTERNATIONAL HOLDINGS, INC. AND SUBSIDIARY Consolidated Statement of Cash Flows (Unaudited) For the Three Months Ended July 31, 2010 2009 ------------------ ----------------- Cash flows from operating activities: Net loss $ (32,509) $ (211,052) ------------------ ----------------- Adjustments to reconcile net loss to net cash used in operating activities: Common stock issued in exchange for Consulting - - Common stock issued in exchange services 1,250 375 Depreciation 39,262 42,986 Changes in operating assets and liabilities: Impairment Loss on Investment - 1,927 Decrease in receivables - 3,166 Decrease (increase) in inventory 28,571 (39,132) Increase in other receivables (10,521) - (Decrease) increase in accounts payable (51,263) 28,970 Increase in accrued payables 26,521 100,053 (Decrease) in customer deposits (64,700) - ------------------ ----------------- Total adjustments (30,880) 138,345 ------------------ ----------------- Net cash received from (used in) operating activities (63,389) (72,707) ------------------ ----------------- Cash flows from investing activities: ------------------ ----------------- Net cash used in investing activities - - ------------------ ----------------- Cash flows from financing activities: Bank overdraft - - Payments on notes payables, related party (7,602) (14,197) Customer deposit - 2,680 (Payment) Proceeds on/from note payable (29,000) 25,000 Payment onshort term deposit (8,152) - Proceeds from lines of Credit 11,551 24,531 ------------------ ----------------- Net cash (used in) provided by financing activities (33,203) 38,014 ------------------ ----------------- Net (decrease) in cash (96,592) (34,693) Cash and cash equivalents - beginning of period 107,223 36,576 Cash and cash equivalents - end of period $ 10,631 $ 1,883 ================== ================= Supplemental disclosure of cash flow information: Interest Paid $ 10,008 $ 26,055 ================== ================= Taxes paid $ - $ - ================== ================= Non-cash financing and investing activities: Equipment Purchased from related party $ - $ - ================== ================= Stock issued for compensation $ 1,250 $ 375 ================== ================= The accompanying notes are an integral part of these financial statements. F-4
MEDINA INTERNATIONAL HOLDINGS, INC. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS For the Three Months Ended JULY 31, 2010 (Unaudited) NOTE 1 - BUSINESS, BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Medina International Holdings, Inc. ("the Company") was incorporated in 1998 as Colorado Community Broadcasting, Inc. and the Company changed the name of the business in 2005 to Medina International Holdings, Inc. The Company, under its two wholly owned subsidiaries, Harbor Guard Boats, Inc. and Medina Marine, Inc., plans to manufacture and sell recreational and commercial boats. The Company formed Medina Marine, Inc., as a wholly owned subsidiary of the Company. Medina Marine was incorporated in the State of California on May 22, 2006 to manufacture and sell fire rescue, rescue and recreational boats. The Company signed an agreement to acquire Modena Sports Design, LLC, as a wholly owned subsidiary of the Company on June 18, 2008. Modena Sports Design, LLC was formed in the State of California in 2003 to produce fire rescue, rescue and recreational boats. Modena Sports Design, LLC reorganized as a California corporation on January 7, 2009 and changed its name to Harbor Guard Boats, Inc. Presentation of Interim Information In the opinion of the management of the Company, the accompanying unaudited financial statements include all normal adjustments considered necessary to present fairly the financial position and operating results of the Company for the periods presented. The financial statements and notes are presented as permitted by Form 10-Q, and do not contain certain information included in the Company's Annual Report on Form 10-KSB for the fiscal year ended April 30, 2010. It is management's opinion that when the interim financial statements are read in conjunction with the April 30, 2010. Annual Report on Form 10-KSB, the disclosures are adequate to make the information presented not misleading. Interim results are not necessarily indicative of results for a full year or any future period. The accompanying consolidated financial statements of Medina International Holdings, Inc. and its subsidiaries were prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") and include the assets, liabilities, revenues, and expenses of our two wholly owned subsidiaries, Medina Marine, Inc. and Harbor Guard Boats, Inc. All intercompany balances and transactions have been eliminated in consolidation. Going Concern Recoverability of a major portion of the recorded asset amounts shown in the accompanying balance sheet is dependent upon continued operations of the Company, which in turn is dependent upon the Company's ability to raise additional capital, obtain financing and to succeed in its future operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. F-5 The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States, which contemplates continuation of the Company as a going concern. On July 31, 2010, the Company's current liabilities exceeded its current assets by $2,400,191. Also, the Company's operations generated 488,260 revenue during the current period ended and the Company's accumulated deficit is $5,475,863. Management has taken various steps to revise its operating and financial requirements, which we believe are sufficient to provide the Company with the ability to continue on in the subsequent year. Management devoted considerable effort during the period ended July 31, 2010 towards management of liabilities and improving our operations. Management believes that the above actions will allow the Company to continue its operations through the next fiscal year. The future success of the Company is likely dependent on its ability to attain additional capital to develop its proposed products and ultimately, upon its ability to attain future profitable operations. There can be no assurance that the Company will be successful in obtaining such financing, or that it will obtain positive cash flow. Summary of Accounting Policies: Basis of Presentation and Consolidation The accompanying consolidated financial statements of Medina International Holdings, Inc. and its subsidiaries were prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") and include the assets, liabilities, revenues, and expenses of our two wholly owned subsidiaries, Medina Marine, Inc. and Harbor Guard Boats, Inc. All intercompany balances and transactions have been eliminated in consolidation. .. Use of Estimates The preparation of our consolidated financial statements in conformity with GAAP requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions are used for, but are not limited to; 1) Revenue recognition; 2) Allowance for doubtful accounts; 3) Inventory costs; 4) Asset impairments; 5) Depreciable lives of assets; 6) Income tax reserves and valuation allowances; 7) Fair value of stock options; 8) Allocation of direct and indirect cost of sales; 9) Contingent liabilities; and 10) Warranty liabilities. F-6 Future events and their effects cannot be predicted with certainty; accordingly, our accounting estimates require exercise of judgment. We base our estimates on historical experience, available market information, appropriate valuation methodologies, and on various other assumptions that we believe to be reasonable. We evaluate and update our assumptions and estimates on an ongoing basis and may employ outside experts to assist in our evaluation, when necessary. Actual results could differ materially from these estimates. Revenue Recognition Revenue Recognition is recognized when earned. The Company's revenue recognition policies are in compliance with Staff Accounting Bulletin (SAB) 104. Sales revenue is recognized at the date of shipment to customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectability is reasonably assured. Payments received before all of the relevant criteria for revenue recognition are satisfied, are recorded as unearned revenue. Cash and Cash Equivalents The Company considers all liquid investments with a maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents. The Company maintains its cash in bank deposit accounts that may exceed federally insured limits. The Company has not experienced any losses in such accounts. Accounts receivable The Company reviews accounts receivable periodically for collectability and establishes an allowance for doubtful accounts and records bad debt expense when deemed necessary. At July 31, 2010 and April 30, 2010, the Company had no balance in its allowance for doubtful accounts. Inventory We carry our inventories at the lower of their cost or market value. Cost is determined using first-in, first-out ("FIFO") method. Market is determined based on net realizable value. We also provide due consideration to obsolescence, excess quantities, and other factors in evaluating net realizable value. Fixed Assets Capital assets are stated at cost. Equipment consisting of molds is stated at cost. Depreciation of fixed assets is provided using the straight-line method over the estimated useful lives (3-7 years) of the assets. Expenditures for maintenance and repairs are charged to expense as incurred. Long Lived Assets The Company adopted codification ASC 350 "Accounting for the Impairment or Disposal of Long-Lived Assets", The Company periodically evaluates the carrying value of long-lived assets to be held and used in accordance with ASC 350. ASC 350 requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets' carrying amounts. In that event, a loss is recognized based on the amount by which the carrying amount exceeds the fair market value of the long-lived assets. Loss on long-lived assets to be disposed of is determined in a similar manner, except that fair market values are reduced. F-7 Comprehensive Loss Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income. Certain statements, however, require entities to report specific changes in assets and liabilities, such as unrealized gains and losses on available-for-sale securities, as a separate component of the equity section of the balance sheet. Such items, along with net income, are components of comprehensive income. Issuance of Shares for Service The Company accounts for employee and non-employee stock awards, whereby equity instruments issued to employees for services are recorded based on the fair value of the instrument issued and those issued to non-employees are recorded based on the fair value of the consideration received or the fair value of the equity instrument, whichever is more reliably measurable. Fair Value Of Financial Instruments Disclosures about fair value of financial instruments, requires that the Company disclose estimated fair values of financial instruments. The carrying amounts reported in the statements of financial position for current assets and current liabilities qualifying, as financial instruments are a reasonable estimate of fair value. Foreign Currency Translation And Hedging The Company is exposed to foreign currency fluctuations due to international trade. The management does not intend to enter into forward exchange contracts or any derivative financial investments for trading purposes. The management does not currently hedge foreign currency exposure. Basic And Diluted Net Loss Per Share Basic net loss per share is based upon the weighted average number of common shares outstanding. Diluted net loss per share is based on the assumption that all dilutive convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Products and services, geographic areas and major customers The Company earns revenue from the sale of recreational and commercial boats. The Company's products were sold domestically and internationally. The Company does not separate sales activities into different operating segments. Recently issued accounting pronouncements There were accounting standards and interpretations issued during the three months ended July 31, 2010, none of which are expected to have a material impact on the Company's financial position, operations or cash flows. F-8 NOTE 2. INVENTORY As of July 31, 2010, inventory consisted of the following: Inventory Cost --------- ---- Parts $31,698 Work-in-Progress 77,907 Finished Goods 26,476 ------------------ Total Inventory $ 136,081 ================== NOTE 3. FIXED ASSETS As of July 31, 2010, fixed assets consisted of the following: Property and Equipment Cost - ---------------------- ---- Machinery and equipment; including molds & tools $1,045,740 Computers 13,535 Furniture & fixture 2,080 Office equipments 3,200 Fire Extinguisher 500 Total Property and Equipment 1,065,055 Less accumulated depreciation (400,469) ------------ Fixed Assets, Net $664,586 ============ NOTE 4. SHORT-TERM DEBT Quarter ended Financial Institutions July 31, 2010 - ---------------------- ------------- Citi bank $ 95,932 Credit Cards 111,673 ------------- Total Short Term debt $ 206,605 ============= At July 31, 2010 the Company has a credit card totaling $100,000, under which the Company may borrow on an unsecured basis since the year 2008 at an interest rate of 8.75.% with monthly payments due. The outstanding balance for this credit card was $95,932. F-9 The Company's remaining credit cards carry various interest rates and require monthly payments, and are substantially held in the name of or guaranteed by related parties. NOTE 5. RELATED PARTY TRANSACTIONS As of July 31, 2010 the Company owed $863,339 to a related party shareholder incurred as part of the purchase transaction of Modena Sports Design, LLC. NOTE 6. CUSTOMER DEPOSIT Deposit from customers at the end of quarter ended July 31, 2010 consists of the following: Deposit for commercial boats $222,800 Deposit for recreational boats 20,500 ------ Total $243,300 ========= NOTE 7. NOTE PAYABLE Quarter ended Items July 31, 2010 ===== ============= Notes payable - related party $ 65,000 Notes payable - others 10,000 ------------------- Total $ 75,000 =================== At July 31, 2010, the Company had an unsecured note payable with an unrelated party in the amount of $10,000, which bears at 8% interest, and is currently due. At July 31, 2010, the Company had an unsecured note payable with an unrelated party in the amount of $15,000, which bears 8% interest and the payment is currently due. At July 31, 2010, the Company had an unsecured note payable to Mr. Srikrishna Mankal, son of Madhava Rao Mankal, CFO of the Company, in the amount of $50,000, which bears an 8% interest repayable. Interest accrued to date $8,000. NOTE 8. SHAREHOLDERS' LOANS At July 31, 2010, Shareholders' loans consisted of the following: Daniel Medina, President & Director $165,314 Madhava Rao Mankal, Chief Financial Officer & Director 253,454 ------- Total $418,768 ======== Shareholder's loan from shareholder of the Company, unsecured, 10% interest per annum, due on demand. F-10 NOTE 9. STOCKHOLDERS' EQUITY During the three months ended, the Company did not issue any shares of its common stock. NOTE 10. COMMITMENTS Rental Leases The Company signed a 3 year lease for 11,900 square feet building in the city of Corona, in the state of California, effective April , 2010. The address for this location is 1802 Pomona Rd, Corona, CA 92880. This building is owned by unrelated parties. The lease expires on March 31, 2013, and calls for monthly payments initially of $2,600 per month plus costs, escalating over the term of the lease to $6,000 per month plus costs. The Company has various license agreements with a related party allowing its technology to be utilized in the manufacture of its boats. The license agreements typical provide for small periodic renewal payments, along with royalty payments based on a percentage (generally 1.5% - 2%) of related gross sales. NOTE 11 - SUBSEQUENT EVENTS The Company evaluated events through August 11, 2010 for subsequent events to be included in its July 31, 2010 financial statements herein. F-11 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion should be read in conjunction with our unaudited financial statements and notes thereto included herein. In connection with, and because we desire to take advantage of, the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, we caution readers regarding certain forward looking statements in the following discussion and elsewhere in this report and in any other statement made by, or on our behalf, whether or not in future filings with the Securities and Exchange Commission. Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other developments. Forward looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward looking statements made by, or on our behalf. We disclaim any obligation to update forward-looking statements. The Company engages nine full time employees. Our President and Chief Financial Officer have been engaged on full time to work with Harbor Guard Boats, Inc. Our securities are currently not liquid. There are no market makers in our securities and it is not anticipated that any market will develop for our securities until such time as we successfully implement our business plan of producing and marketing our laser stripping machine and/or acquiring other assets or equipment. We presently have no liquid financial resources to offer such a candidate and must rely upon an exchange of our stock to complete such a merger or acquisition. RESULTS OF OPERATION Results Of Operations For The Three-Month Period Ended July 31, 2010 Compared To The Same Period Ended July 31, 2009 The Company recognized $488,260 in revenues during the three months ended July 31, 2010 compared to $870 in 2009 resulting in increase of sales during this quarter of $487,390. We sold three boats during the quarter ended July 31, 2010 compared to none during the quarter ended July 31, 2009. During the three months ended July 31, 2010 general and administrative expenses decreased by $18,458 or 15.27% to $102,366 for the quarter ended July 31, 2010 compared to $120,824 for the quarter ended July 31, 2009. Selling and marketing expenses increased by $52,844 to $53,131 for the quarter ended July 31, 2010 compared to $287 for the quarter ended July 31, 2009. Increase is mainly due to $34,938 in sales commission, $8,029 in freight and $7,135 in trade show expenses for the quarter ended July 31, 2010. During the three months ended July 31, 2010 interest expense decreased by $16,047 or 61.58% to $10,008 for the period ended July 31, 2010 compared to $26,055 for the period ended July 31, 2009. 1 During the three months ended July 31, 2010, the Company recognized a net loss of $32,509 compared to a net loss of $211,052 for the quarter ended July 31, 2009. The decrease of $178,543 or 84.60% was mostly due to the gross profit on sale of boats. LIQUIDITY AND CAPITAL RESOURCES At July 31, 2010, we had $10,631 in cash, $1,065,055 in gross fixed assets. The Company will need to raise capital through loans or private placements in order to carry out any operational plans. During the three months ended July 31, 2010, the Company used $63,389 from its operating activities. The Company used $33,203 through financing activities during the three months ended July 31, 2010. At July 31, 2010, the Company had a working capital deficit of $2,400,191. During the three months ended July 31, 2009, the Company used $72,707 from its operating activities. The Company had $1,883 in cash at July 31, 2009. The Company provided $38,014 through financing activities during the three months ended July 31, 2010. During the three months ended July 31, 2010, the Company made a payment of $29,000 on promissory notes and $7,602 owed to related party of the Company. ITEM 3. QUANTATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. Not Applicable ITEM 4. CONTROLS AND PROCEDURES Disclosures Controls and Procedures We have adopted and maintain disclosure controls and procedures (as such term is defined in Rules 13a 15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act, is recorded, processed, summarized and reported within the time periods required under the SEC's rules and forms and that the information is gathered and communicated to our management, including our Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer), as appropriate, to allow for timely decisions regarding required disclosure. As required by SEC Rule 15d-15(b), our Chief Executive Officer carried out an evaluation under the supervision and with the participation of our management, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 15d-14 as of the end of the period covered by this report. Based on the foregoing evaluation, our Chief Executive Officer has concluded that our disclosure controls and procedures are effective in timely alerting them to material information required to be included in our periodic SEC filings and to ensure that information required to be disclosed in our periodic SEC filings is accumulated and communicated to our management, including our Chief Executive Officer, to allow timely decisions regarding required disclosure as a result of the deficiency in our internal control over financial reporting discussed below. 2 ITEM 4T. CONTROLS AND PROCEDURES Management's Quarterly Report on Internal Control over Financial Reporting. Our management is responsible for establishing and maintaining adequate internal control over financial reporting for the company in accordance with as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements. Management's assessment of the effectiveness of the small business issuer's internal control over financial reporting is as of the quarter ended July 31, 2010. We believe that internal control over financial reporting is effective. We have not identified any, current material weaknesses considering the nature and extent of our current operations and any risks or errors in financial reporting under current operations. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. This quarterly report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm.. There was no change in our internal control over financial reporting that occurred during the fiscal quarter ended July 31, 2010, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. 3 PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS - NONE ITEM 2. CHANGES IN SECURITIES - NONE ITEM 3. DEFAULTS UPON SENIOR SECURITIES - NONE ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - NONE ITEM 5. OTHER INFORMATION - NONE. ITEM 6. EXHIBITS - Exhibits. The following is a complete list of exhibits filed as part of this Form 10-Q. Exhibit numbers correspond to the numbers in the Exhibit Table of Item 601 of Regulation S-K. Exhibit 31.1 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act Exhibit 31.2 Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act Exhibit 32.1 Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act Exhibit 32.2 Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act 4 SIGNATURES Pursuant to the requirements of Section 12 of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. MEDINA INTERNATIONAL HOLDINGS, INC. (Registrant) Dated: August 20, 2010 By: /s/ Daniel Medina -------------------------- Daniel Medina, President Dated: August 20, 2010 By: /s/ Madhava Rao Mankal -------------------------- Madhava Rao Mankal, Chief Financial Officer 5 EX-31.1 2 ex31dm.txt CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a) (Section 302 of the Sarbanes Oxley Act of 2002) I, Daniel Medina, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Medina International Holdings, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant issuer as of, and for, the periods presented in this report; 4. As registrant's certifying officer I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)) for the registrant and have: a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision to ensure that material information relating to the registrant issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c. Evaluated the effectiveness of the registrant issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d. Disclosed in this report any change in the registrant issuer's internal control over financial reporting that occurred during the registrant issuer's most recent fiscal quarter (the registrant issuer's 4th quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant issuer's internal control over financial reporting; and 5. As the registrant issuer's certifying officer, I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant issuer's auditors and the audit committee of the registrant issuer's board of directors (or persons performing the equivalent functions): a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant issuer's ability to record, process, summarize and report financial information; and b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant issuer's internal control over financial reporting. Date: August 20, 2010 By:/s/ Daniel Medina --------------------------- Daniel Medina President and Chief Executive Officer EX-31.2 3 ex31rm.txt CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a) (Section 302 of the Sarbanes Oxley Act of 2002) I, Madhava Rao Mankal, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Medina International Holdings, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant issuer as of, and for, the periods presented in this report; 4. As registrant's certifying officer I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)) for the registrant and have: a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision to ensure that material information relating to the registrant issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c. Evaluated the effectiveness of the registrant issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d. Disclosed in this report any change in the registrant issuer's internal control over financial reporting that occurred during the registrant issuer's most recent fiscal quarter (the registrant issuer's 4th quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant issuer's internal control over financial reporting; and 5. As the registrant issuer's certifying officer, I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant issuer's auditors and the audit committee of the registrant issuer's board of directors (or persons performing the equivalent functions): a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant issuer's ability to record, process, summarize and report financial information; and b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant issuer's internal control over financial reporting. Date: August 20, 2010 By: /s/ Madhava Rao Mankal --------------------------- Madhava Rao Mankal Chief Financial Officer EX-32.1 4 ex32dm.txt EXHIBIT 32 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Medina International Holdings, Inc. (the "Company") on Form 10-Q for the period ending July 31, 2009 as filed with the Securities and Exchange Commission on the date hereof (the "Report"). I, Daniel Medina, President of the company, certify, pursuant to 18 USC Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge and belief. (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /s/ Daniel Medina -------------------------------- Daniel Medina, President Date: August 20, 2010 EX-32.2 5 ex32rm.txt EXHIBIT 32 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Medina International Holdings, Inc. (the "Company") on Form 10-Q for the period ending July 31, 2010 as filed with the Securities and Exchange Commission on the date hereof (the "Report"). I, Rao Mankal, Chief Financial Officer of the company, certify, pursuant to 18 USC Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge and belief. (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /s/ Rao Mankal -------------------------------- Rao Mankal, Chief Financial Officer Date: August 20, 2010 -----END PRIVACY-ENHANCED MESSAGE-----