0001165527-12-001110.txt : 20121022 0001165527-12-001110.hdr.sgml : 20121022 20121022133420 ACCESSION NUMBER: 0001165527-12-001110 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 11 CONFORMED PERIOD OF REPORT: 20120831 FILED AS OF DATE: 20121022 DATE AS OF CHANGE: 20121022 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Domark International Inc. CENTRAL INDEX KEY: 0001365160 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS REPAIR SERVICES [7600] IRS NUMBER: 204647578 STATE OF INCORPORATION: NV FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 333-136247 FILM NUMBER: 121154296 BUSINESS ADDRESS: STREET 1: 254 S RONALD REAGAN BLVD, STE 134 CITY: LONGWOOD STATE: FL ZIP: 32750 BUSINESS PHONE: 321-250-4996 MAIL ADDRESS: STREET 1: 254 S RONALD REAGAN BLVD, STE 134 CITY: LONGWOOD STATE: FL ZIP: 32750 FORMER COMPANY: FORMER CONFORMED NAME: DoMar Exotic Furnishings Inc. DATE OF NAME CHANGE: 20060605 10-Q 1 g6333.txt U.S. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended August 31, 2012 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT For the transition period from ________ to ________ Commission File No. 333-136247 DoMark International, Inc. (Name of small business issuer as specified in its charter) Nevada 20-4647578 (State of Incorporation) (IRS Employer Identification No.) 254 S Ronald Reagan Blvd, Ste 134 Longwood, FL 32750 (Address of principal executive offices) 321-250-4996 (Issuer's telephone number) Securities registered under Section 12(b) of the Exchange Act: None Securities registered under Section 12(g) of the Exchange Act: Common Stock, $0.001 par value per share (Title of Class) 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 preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such 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 [X] No [ ] Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. Large accelerated filer [ ] Accelerated Filer [ ] Non-accelerated filer [ ] 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] As of August 31, 2012, there were 29,540,298 shares of Common Stock, $0.001 par value per share, issued and outstanding and there were 50,000 shares of Preferred Stock A, $0.001 par value per share, issued and outstanding Preferred Stock B, $0.001 par value per share and zero shares issued and outstanding. EXPLANATORY NOTE This Form 10-Q of Domark International, Inc.'s (the "Company") reflects the status and operations of the Company and its three (3) subsidiaries, Solawerks Inc ("Solawerks"), Musclefoot Inc. ("Musclefoot") and Domark Canada Inc. ("Domark Canada") as of August 31, 2012. During the quarter the company hired a new Chief Executive Officer, Andrew Ritchie and a new Vice President - Business Development, Patrick Johnson. The new management team sets about reviewing the company operations and restructuring initiatives. The main operation of the company has been the sale of our Apple iPhone and iPad solar battery charging covers through our subsidiary Solawerks. The Company formed a new subsidiary named Musclefoot Inc. in June of this year. The main purpose of this subsidiary is to sell our new licensed, patented and FDA approved shoe insole from Barefoot Science, Inc. The Company has spent the first quarter building new websites, media campaigns, retail sales strategy, affiliate programs and building a world class infrastructure to support the sales of our products. We then tested the new sites and media campaigns in various media channels. After analyzing and adapting the initial results of our offerings, we are now well positioned for a full media launch the Company's products in the run-up to Holiday Season. The Company has also invested in developing the next generation of iPhone and iPad solar chargers. These will be ready to be launched within the 2nd quarter. The management has also been reviewing the Company's past financial history, including share and debt structure in order to ensure that the best capital structure is utilized by the Company going forward. 2 DOMARK INTERNATIONAL, INC. INDEX TO FORM 10-Q FILING FOR THE THREE MONTHS ENDED AUGUST 31, 2012 TABLE OF CONTENTS PAGE ---- PART I - FINANCIAL INFORMATION Item 1. Consolidated Financial Statements (unaudited) 4 Consolidated Balance Sheets 4 Consolidated Statements of Operations 6 Consolidated Statements of Cash Flows 7 Notes to Consolidated Financial Statements 8 Item 2. Management Discussion & Analysis of Financial Condition and Results of Operations 16 Item 3. Quantitative and Qualitative Disclosures About Market Risk 18 Item 4. Controls and Procedures 18 PART II - OTHER INFORMATION Item 1. Legal Proceedings 19 Item 1A. Risk Factors 20 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 20 Item 3. Defaults Upon Senior Securities 20 Item 4. Mine Safety Disclosure 20 Item 5. Other information 20 Item 6. Exhibits 20 3 PART I - FINANCIAL INFORMATION ITEM 1 - FINANCIAL STATEMENTS DOMARK INTERNATIONAL INC. (A development stage company) CONSOLIDATED BALANCE SHEETS (unaudited) August 31, 2012 May 31, 2012 --------------- ------------ (unaudited) (audited) ASSETS CURRENT ASSETS Cash $ 29,052 $ 52,269 Inventory 13,611 -- Prepaid expenses 95,877 4,897 Prepaid Licensee fee 2,000,000 -- ---------- ---------- TOTAL CURRENT ASSETS 2,138,540 57,166 ---------- ---------- OTHER ASSETS Deferred financing costs 10,000 24,799 Website development costs, net -- 2,250 XSE license, net 9,266 9,635 Prepaid Licensee fees long-term 3,605,480 -- ---------- ---------- TOTAL OTHER ASSETS 3,624,746 36,684 ---------- ---------- TOTAL ASSETS $5,763,286 $ 93,850 ========== ========== The accompanying notes are an integral part of these consolidated financial statements. 4 DOMARK INTERNATIONAL INC. (A development stage company) CONSOLIDATED BALANCE SHEETS (CONTINUED) (unaudited)
LIABILITIES AND STOCKHOLDERS' DEFICIENCY August 31, 2012 May 31, 2012 --------------- ------------ CURRENT LIABILITIES Accounts payable and accrued expenses $ 138,580 $ 89,164 Accounts payable - related party 40,808 15,366 Notes payable 545,645 545,645 ------------ ------------ TOTAL CURRENT LIABILITIES 725,033 650,175 ------------ ------------ LONG-TERM LIABILITIES Due to affiliate and shareholder 154,772 1,000 ------------ ------------ Total Long-term Liabilities 154,772 1,000 ------------ ------------ TOTAL LIABILITIES 879,755 651,175 ------------ ------------ STOCKHOLDERS' DEFICIT Convertible preferred stock series A, $0.001 par value, Authorized: 2,000,000 Issued: 50,000 and 50,000 as of August 31, 2012 and May 31, 2012, respectively 50 50 Convertible preferred stock series B, $0.001 par value, -- -- Authorized: 10,000,000 Common Stock, $0.001 par value, Authorized: 200,000,000 Issued: 29,540,298 and 29,005,298, respectively 29,540 29,005 Common stock payable 818,000 738,000 Preferred Series B stock payable 6,000,000 -- Additional paid-in capital 32,046,149 31,499,031 Accumulated deficit (26,850,830) (26,850,830) Accumulated Deficit during development stage (7,159,378) (5,972,579) ------------ ------------ TOTAL STOCKHOLDERS' DEFICIENCY 4,883,531 (557,326) ------------ ------------ TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY $ 5,763,286 $ 93,850 ============ ============
The accompanying notes are an integral part of these consolidated financial statements. 5 DOMARK INTERNATIONAL INC. (A development stage company) CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
For the cumulative period during the Development Stage For the For the from Three Months Three Months October 21, 2009 Ended Ended to August 31, 2012 August 31, 2011 August 31, 2012 --------------- --------------- --------------- REVENUE $ 20,345 $ -- $ 40,274 Cost of sales 22,976 -- 71,485 ------------ ------------ ------------ Gross Profit (2,631) -- (31,211) General and administrative expenses 788,647 137,589 6,600,606 Research and development -- -- 45,607 Bad debt expense 1,000 -- 101,000 Impairment of asset -- -- 10,000 Impairment of goodwill -- -- 10,000 Forgiveness of debt -- -- 4,000 License Fees 394,520 -- 394,520 ------------ ------------ ------------ Operating Loss (1,186,799) (137,589) (7,188,945) Other Income -- -- 29,567 ------------ ------------ ------------ Net Loss $ (1,186,799) $ (137,589) $ (7,159,378) ============ ============ ============ Net loss per share, basic and diluted $ (0.04) $ 0.00 $ (0.25) ============ ============ ============ Weighted average common shares outstanding 29,350,896 36,953,743 29,035,724 ============ ============ ============
The accompanying notes are an integral part of these consolidated financial statements. 6 DOMARK INTERNATIONAL INC. (A development stage company) CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
For the Cumulative Period During The Development Stage For the For the from Three Months Three Months October 21, 2009 Ended Ended to August 31, 2012 August 31, 2011 August 31, 2012 --------------- --------------- --------------- CASH FLOWS FROM OPERATING ACTIVITIES Net loss $(1,186,799) $ (137,589) $(7,159,378) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 2,619 1,968 13,458 Amortized finance cost 14,799 -- 50,000 Non cash interest -- -- 5,645 Impairment of assets -- -- 10,000 Bad debt expense -- -- 1,000 Common stock issued as compensation and for expenses 920,175 28,153 5,544,485 Gain on sale of assets -- -- -- Forgiveness of debt -- -- (4,000) Changes in operating assets and liabilities: Decrease prepaid exp and other current assets 11,020 -- 11,020 Increase inventory (13,611) -- (30,537) Decrease in deferred financing costs -- (3,516) (3,516) Increase in accounts payable 49,416 26,000 288,351 Increase in accounts payable-related party 25,442 -- 40,808 Increase in accrued expenses -- 14,426 -- ----------- ----------- ----------- NET CASH USED IN OPERATING ACTIVITIES (176,939) (70,558) (1,230,149) CASH FLOWS FROM INVESTING ACTIVITIES Cash paid for licensing -- -- (35,000) Cash paid for web development -- (4,000) (7,500) Cash paid for furniture and equipment -- -- (4,000) ----------- ----------- ----------- NET CASH FLOWS USED IN INVESTING ACTIVITIES -- (4,000) (46,500) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds received from shareholder loans 153,722 5,000 1,048,122 Payment on shareholder loans -- (19,273) (125,478) Proceeds received from notes payable -- -- 480,000 Payments made on notes payable -- -- (100,470) ----------- ----------- ----------- NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 153,722 70,727 1,302,174 Net increase (decrease) in cash and cash equivalents (23,217) (3,831) 25,525 Cash and cash equivalents - beginning of period 52,269 4,587 3,527 ----------- ----------- ----------- CASH AND CASH EQUIVALENTS BALANCE END OF PERIOD $ 29,052 $ 756 $ 29,052 =========== =========== =========== SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: Prepaid license fee $ 6,000,000 $ -- $ 6,000,000 Prepaid expenses $ -- $ -- $ (397,675) Inventory $ -- $ -- $ (16,926) Fixed assets, net of depreciation $ -- $ -- $ (3,868) Website costs, net of amortization $ -- $ -- $ (1,167) License, net of amortization $ -- $ -- $ (24,432) Accounts payable $ -- $ -- $ 19,257 Payroll & related liabilities $ -- $ -- $ 249,631 Due to affiliate and shareholder $ -- $ -- $ 929,738 Return of preferred shares, par value $ -- $ -- $ 50 Return of common stock, par value $ -- $ -- $ 9,772 Additional capital contributed in excess of net assets sold $ -- $ -- $ (764,380)
The accompanying notes are an integral part of these consolidated financial statements. 7 DOMARK INTERNATIONAL INC. (A DEVELOPMENT STAGE COMPANY) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the Quarter Ended August 31, 2012 NOTE 1. DESCRIPTION OF BUSINESS DOMARK INTERNATIONAL, INC. ("Domark" or the "Company") was incorporated under the laws of the State of Nevada on March 30, 2006. In 2008, the Company embarked on a business plan that was intended to acquire profitable businesses that would create shareholder value in diverse industries. During 2008 and 2009, the Company acquired several operating businesses, as set forth in various Current Reports on Form 8-K filed with the Securities and Exchange Commission. On May 21, 2009, the Company closed an acquisition pursuant to an Agreement for the Exchange of Common Stock (the "Victory Lane Agreement") with Victory Lane Financial Elite, LLC ("Victory Lane") with respect to a real estate lifestyle business known as "Victory Lane" (the "Victory Lane Business"). Shortly thereafter, a dispute arose between the Company and the principals of Victory Lane regarding the representations of the principals of Victory Lane and the Victory Lane Business and the Victory Lane Agreement. Litigation between the Company and various parties pertaining to the Victory Lane Business remains outstanding. (Refer to Notes 7 - Contingencies & Item II, Other Information below). HISTORY AND GENERAL OVERVIEW On February 29, 2012, the Company formed a new wholly owned subsidiary, Solawerks Inc. in the state of Nevada, for the purposes of entering the business of marketing specialized solar consumer electronics. Solawerks' current focus is to develop and distribute the SolaPad: a combined cover and charging system for Apple's iPad, and the SolaCase: a combined cover and charging system for all versions of Apple's iPhone. Solawerks competes in a market that also includes 3D Systems (DDD), Dell (DELL) and Hewlett Packard (HPQ). During the last half of 2009, the Company sold two of its operating subsidiaries, Javaco, Inc. and ECFO Corporation and effected rescissions of acquisition transactions on the remainder of its operating businesses. Between October 2009 and May 2011, the Company had no material ongoing operations. The business of the Company during the period from October 2009 through May 2011 was to seek out new acquisitions and to conduct the litigation with Victory Lane. On March 5, 2012, the Company entered into an Asset Purchase Agreement with its then controlling shareholder, R. Thomas Kidd, for the sale of Armada, and certain assets related thereto. On May 26, 2012, the Company hired a new Chairman and President Brent Strasler. He then hired a new Chief Executive Officer Andrew Ritchie on 12 June 2012. The Company then strengthened the executive team by adding Patrick Johnson as VP - business development. On May 31, 2011, the Company formed a wholly owned subsidiary, Armada Sports & Entertainment, Inc. Armada is a sports marketing and Management Company engaged in owning, developing, and conducting made-for-television sports and entertainment events. On March 5, 2012, the Company entered into an Asset Purchase Agreement with its then controlling shareholder, R. Thomas Kidd, for the sale of Armada, and certain assets related thereto. In June 2012, the Company entered into a retail sales strategy with North American retail specialist Chic and Savvy. During the 1st quarter, they attended many retail sales exhibitions throughout Canada. On June 20, 2012, the Company formed a new wholly owned subsidiary, Musclefoot Inc. in the state of Nevada for the purpose of distributing, marketing, and acting as sales agent for the patented foot care system, Barefoot Science. This entity is currently in default under the Nevada Secretary of State. On July 20, 2012, the Company formed a new wholly owned subsidiary, Domark Canada Inc. in the province of Ontario for the purpose of supporting the corporate operations based in Toronto, Ontario Canada. The Company then endorsed world champion triple jumper Will Claye, and US Olympian Nick Simmons prior to the London 2012 Olympic Games. This was part of a strategy to obtain global exposure and align brands with world class sports professionals. We then sponsored several UFC championship contenders. 8 As a result of the change in the Company's business model, the disclosures and financial results contained herein should be reviewed as they relate to the Company's historical operations but should be discounted as they relate to the Company's potential future results. NOTE 2. GOING CONCERN The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America which contemplate continuation of the Company as a going concern. The Company has consolidated losses from operations of ($1,186,799) for the 3 months ending August 31, 2012 compared to a loss of ($137,589) for the same period ending August 31, 2011. Furthermore, the Company has inadequate working capital to maintain or develop its operations, and is dependent upon funds from private investors and the financial support of certain stockholders. These factors raise substantial doubt about the ability of the Company to continue as a going concern. These 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 result from this uncertainty. In this regard, management is planning to raise any necessary additional funds through loans and additional sales of its common stock. There is no assurance that the Company will be successful in raising additional capital. NOTE 3. BASIS OF PRESENTATION The unaudited consolidated financial statements of the Company have been prepared in accordance with United States generally accepted accounting principles ("GAAP") for financial information and the rules and regulations of the Securities and Exchange Commission ("SEC"). In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation, have been included. Operating results for the three months ended August 31, 2012 are not necessarily indicative of the results that may be expected for the year ending May 31, 2013. NOTE 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECENT ACCOUNTNG PRONOUNCEMENTS The Company has reviewed recently issued accounting pronouncements and plans to adopt those that are applicable to it. It does not expect the adoption of these pronouncements to have a material impact on its financial position, results of operations or cash flows. DEVELOPMENT STAGE COMPANY The Company is a development stage company as defined in ASC Standard 915-10-05 and has recognized no revenue and devotes substantially all of its efforts on establishing its online retail and product development business. Its planned principal operations in advancing its online product development business have commenced. All losses accumulated since inception have been considered a part of the Company's development stage activities. USE OF ESTIMATES The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. These estimates and assumptions also affect the reported amounts of revenues, costs and expenses during the reporting period. Management evaluates these estimates and assumptions on a regular basis. Actual results could differ from those estimates. The primary management estimates included in these financial statements is the licensing fees, stock option valuation and the fair value of its stock tendered in various non-monetary transactions. CASH AND CASH EQUIVALENTS The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. At August 31, 2012, cash and cash equivalents included cash on hand and cash in the bank. 9 INVENTORIES Inventories consist of retail products which are stated at the lower of cost or market. Cost is determined by the specific identification method. FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying amounts reflected in the consolidated balance sheets for cash, accounts payable, and accrued expenses approximate the respective fair values due to the short maturities of these items. PRINCIPLES OF CONSOLIDATION The accompanying financial statements represent the consolidated financial position and results of operations of the Company and include the accounts and results of operations of the Company and its subsidiaries. The accompanying financial statements include the active entity of Domark International, Inc. and its wholly owned subsidiaries, Musclefoot Inc., Solawerks Inc and Domark Canada Inc. The Company has relied upon the guidance provided by Statements of Financial Accounting Standards, ASC 810-10-15-3. STOCK-BASED COMPENSATION The Company accounts for share based payments in accordance with ASC 718, Compensation - Stock Compensation, which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on the grant date fair value of the award. In accordance with ASC 718-10-30-9, Measurement Objective - Fair Value at Grant Date, the Company estimates fair value of the award using a valuation technique. For this purpose, the Company uses the Black-Scholes option pricing model. The Company believes the model provides the best estimate of fair value due to its ability to incorporate inputs that change over time, such as volatility and interest rates, and to allow for actual exercise behavior of option holders. Compensation cost is recognized over the requisite service period which is generally equal to the vesting period. Upon exercise, shares issued will be newly issued shares from authorized common stock. ASC 505, "Compensation-Stock Compensation", establishes standards for the accounting for transactions in which an entity exchanges its equity instruments to non-employees for goods or services. Under this transition method, stock compensation expenses includes compensation expense for all stock-based compensation awards granted on or after January 1, 2006, based on the grant-date fair value estimated in accordance with provisions of ASC 505. NET LOSS PER COMMON SHARE The Company computes net loss per share in accordance with the Earning per Share Topic of the FASB ASC 260. Under the provisions of ASC, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is anti-dilutive. As of August 31, 2012, options and warrants were outstanding and have been valued using Black-Scholes. 10 RESEARCH AND DEVELOPMENT All research and development expenditures are expensed as incurred. There was no R&D cost incurred during the Quarter. REVENUE RECOGNITION The Company recognizes revenues when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price is fixed or determinable, and collection of the resulting receivable is reasonably assured. Inventory is capitalized and costs of sales are recognized during the period in which the sales occurred. The Company derived its revenues for the period through internet sales of our solar charging units. The Company recognized these sales once delivery is made from the warehouse (FOB shipping point). NOTE 5. RELATED PARTY TRANSACTIONS On February 29, 2012 the Company executed a Memorandum of Agreement with Xiamen Tiauyang Neng Gongsi and Michael Franklin related to the acquisition of certain exclusive worldwide licensing and joint patent rights. On May 25, 2012, the Company entered into an employment agreement with an effective date of June 1, 2012 with its newly appointed President, R. Brentwood Strasler, for a period of no less than three years. Mr. Strasler is entitled to an annual salary of $150,000 and 100,000 stock purchase warrants exercisable to purchase common shares of the Company at $1.00 per share. The warrants are exercisable for a three year period and can be vested quarterly on a pro rata basis over twelve months from the date of issue. Additionally, Mr. Strasler will be enrolled in a long term Executive Option Plan no later than three months after the effective date of the employment agreement and is entitled to term life insurance in the face amount of $2,500,000, payable to the beneficiary designated by Mr. Strasler. The warrants awarded will be valued in accordance with ASC 718-10-30-9, Measurement Objective - Fair Value at Grant Date. The Company estimates fair value of the award using the Black-Scholes option pricing model. The Company is indebted to Michael Franklin, previously President of our wholly owned subsidiary Solawerks, Inc., in the amount of $1,000 for monies advanced to the Company to initiate the initial opening of the Sun Trust bank account. This loan is non-interest bearing and payable upon demand. 11 NOTE 6. SHAREHOLDERS' EQUITY * On May 25, 2012, - R Brentwood Strasler was appointed as Chairman and President / Director, with an annual compensation of $150,000 and 150,000 share options at $1.00 which will vest in one year on a quarterly basis. The Company valued the options using the Black-Scholes valuation model. As of the grant date the options were valued at $175,419. DoMark International Inc. Announces Appointment of New President * On Jun 18, 2012, - Andrew Ritchie was appointed as Chief Executive Officer/ Director with an annual Compensation of $240,000 and 250,000 share options at $1.00 which will vest in one year on a quarterly basis. The Company valued the options using the Black-Scholes valuation model. As of the grant date the options were valued at $175,414. DoMark International Inc. Announces Appointment of New Chief Executive Officer * On Jun 21, 2012, - Domark signed a contract with Barefoot-Science to become exclusive marketing direct sales distributor for North America. Barefoot - Science will be issued 2,500,000 shares of Preferred B shares of Domark International Inc. which are convertible at any time at request of holder into common A shares at a 1 Preferred Series B into 2 Common shares ratio. Shares will hold a six month restriction under 144 rules. The shares have been valued at $6,000,000 USD which will be expensed over the term of the agreement (3 years). As of August 31, 2012, $394,520 USD has been expensed. DoMark International, Inc. Enters Into Multi-Billion Dollar Footwear and Foot Care Markets with Industry Changing Technology From Barefoot Sciences Inc. * On Jun 26, 2012, - Patrick Johnson was appointed as Vice President of Business Development, with an annual compensation of $84,000 and 100,000 share options at $1.00 which will vest in one year on a quarterly basis. The Company valued the options using the Black-Scholes valuation model. As of the grant date the options were valued at $116,946. DoMark International Inc. Announces Appointment of All-Star Athlete and Super Bowl Champion as VP - Corporate Development * On Jun 26, 2012,- RBL were appointed to look after all Domarks Social media campaigns. They were awarded a contract of $1,000 a month and were granted 20,000 free trading shares in Domark international valued at $23,400. DoMark International Inc. Announces Appointments RBL Communications as social media agent. * On July 11, 2012 - Ian Nuttall received an additional 425,000 shares as a consultant to Domark of Rule 144 common `A' stock in Domark International Inc. valued at $382,500. On Jul 19, 2012, - Domark signs Nick Symmonds to endorse Domark products for compensation of 100,000 shares of rule144 common A stock in Domark International Inc. valued at $68,000. DoMark Signs Five-Time American 800 m Champion Nick Symmonds to Endorsement Deal * On Jul 25, 2012, - Domark signs Will Claye to endorse Domark products for compensation of 50,000 shares of rule144 common A stock in Domark International Inc.valued at $34,000. 12 * Strasler. The warrants awarded will be valued in accordance with ASC 718-10-30-9, Measurement Objective - Fair Value at Grant Date. The Company estimates fair value of the award using the Black-Scholes option pricing model. Since the effective date of the grant is June 1, 2012, the Company did not realize or record an estimated fair value of the warrants and therefore there is no impact to the financial statements for the fiscal period ending May 31, 2012. Our common stock is traded in the over-the-counter market, and quoted in the National Association of Securities Dealers Inter-dealer Quotation System ("Electronic Bulletin Board) and can be accessed on the Internet at www.otcbb.com under the symbol "DOMK.OB". As of August 31, 2012, there were 29,540,298 shares of our common stock outstanding and 50,000 shares of Preferred Series A (1000:1 conversion)and 2,500,000 shares of Preferred Series B (2:1 conversion). There were approximately 84 shareholders of record of the Company's common stock. NOTE 7. CONTINGENCIES * On May 21, 2009, the Company entered into that certain Agreement for the Exchange of Common Stock (the "Victory Lane Agreement") with Victory Lane Financial Elite, LLC ("Victory Lane") with respect to a real estate lifestyle business known as Victory Lane (the "Victory Lane Business") pursuant to which the Company intended to purchase the Victory Lane Business. Shortly thereafter, a dispute arose between the Company and Victory Lane regarding alleged mis-representations made by Victory Lane in connection with the Victory Lane Agreement. * In August, 2009, Victory Lane Financial Elite, LLC, Legacy Development, LLC and Patrick Costello filed suit in the Superior Court of Tattnall County, Georgia (Civ. No. 2009-V-381-JW) against the Company, R. Thomas Kidd and various officers and directors of the Company, alleging that the Company was in breach of the Victory Lane Agreement and that the Company and certain of the individual defendants had committed various torts against the plaintiffs and that certain of the individual defendants had violated various fiduciary and other duties owed to the plaintiffs in connection with the Victory Lane Agreement and the handling of the Victory Lane Business (the "VLFE Case"). The plaintiffs sought a declaratory judgment to the effect that the Victory Lane Agreement had not been executed, as well as money damages from the Company and the individual defendants. The Company and Mr. Kidd have answered the Complaint, denying any liability for the plaintiff's claims and have asserted various counterclaims including fraud and other torts. In July 2010 the court dismissed all of the individual defendants, other than R. Thomas Kidd, in response to a motion to dismiss for lack of jurisdiction. The case has since been stayed. * In December, 2009, AHIFO-21, LLC filed a lawsuit in the Superior Court of Tattnall County, Georgia (Civ. No. 2009-V-672-JS) against Victory Lane, LLC, Patrick J. Costello and Stephen Brown (the "Victory Lane Defendants") alleging that the Victory Lane Defendants owe the plaintiff more than $7,740,000 in respect of one or more loans made by the plaintiff to certain of the Victory Lane Defendants in connection with the Victory Lane Business (the "AHIFO Case"). In February, 2010, the Victory Lane Defendants filed a Third Party Complaint against the Company and R. Thomas Kidd, claiming that the Company and Mr. Kidd should be liable for any amounts the Victor Lane Defendants are required to pay to the plaintiff in this case. The Company and Mr. Kidd have answered the Complaint, denying any liability for the plaintiff's claims and have asserted various counterclaims including fraud and other torts. The Company and Mr. Kidd filed a motion to dismiss the Third Party Complaint, but the entire case was subsequently stayed. * Because each of the VLFE Case and the AHIFO Case have been stayed and because discovery in those cases is not complete, the Company has not reached a determination that any loss is other than remote and that the amount of any damages, if any were determined adverse to the Company, would 13 be reasonably estimable. The Company believes that it has meritorious claims against the opposing parties with respect to the Victory Lane Agreement and that the claims asserted against it are not meritorious. The Company intends to defend itself vigorously. NOTE 8. COMMITMENTS * On Jul 16, 2012, - Leading specialist Sports physio was appointed to Domarks advisory committee with a signing agreement of $10,000. DoMark International Inc. Appoints Sean Pena to Advisory Committee * On Jun 28, 2012, - Domark donates a Noraxon foot Scanner to Sean Penna to assist in the training of the U.S Olympic team. The machine cost $19,495, and is being purchased through a rental buy agreement of $895 a month. Donates Performance Enhancing Technology by Noraxon to Assist Physio Expert to World's Top Track Athletes in Preparation for the 2012 Olympic Games 14 NOTE 9. LIABILITIES & NOTES PAYABLE On February 29, 2012, Company entered into a Promissory Note with R. Thomas Kidd, our then Chief Executive Officer of the Company, and Infinite Funding, Inc. ("IFI"). This Note replaces four promissory notes issued by IFI to the Company as more fully described below. Effective March 3, 2011, we obtained an unsecured loan in the amount of $75,000 from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note from the Company to Infinite Funding, Inc. dated March 3, 2011 (the "IFI Note"). The Note was amended three times to extend the due date and was first amended on June 9, 2011, a second time on September 28, 2011, and a third amendment on December 9, 2011. Pursuant to the amendments, the Company agreed to pay extension fees of $30,000, thereby increasing the principle balance of this Note to $105,000. Effective June 10, 2011, we obtained an unsecured loan in the amount of $75,000 from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note from the Company to Infinite Funding, Inc. dated June 10, 2011 (the "IFI Note"). The Note was amended two times to extend the due date and was first amended on September 28, 2011 and again on December 9, 2011. Pursuant to the amendments, the Company agreed to pay extension fees of $20,000, thereby increasing the principle balance of this Note to $95,000. Effective September 28, 2011, we obtained an unsecured loan in the amount of $40,000 from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note from the Company to Infinite Funding, Inc. dated September 28, 2011 (the "IFI Note"). The Note was amended to extend the due date on December 9, 2011. Pursuant to this amendment, the Company agreed to pay an extension fee of $10,000, thereby increasing the principle balance of this Note to $50,000. Effective December 9, 2011, we obtained an unsecured loan in the amount of $100,000 from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note from the Company to Infinite Funding, Inc. dated December 9, 2011 (the "IFI Note"). As a result of consolidating the aforementioned debt, the Company is now obligated under a single Promissory Note dated February 29, 2012 in the aggregate principle amount of $355,645 along with $2,689 in accrued interest. The Note is due on October 15, 2012 and accrues interest at 3% per annum. In addition, R Thomas Kidd executed a Personal Guarantee of the Note, whereby Kidd guarantees the payment of $100,000 of the principle balance in an Event of Default pursuant to Article III of the Note. MASTER CREDIT AGREEMENTS On March 2, 2012, the Company entered into a Master Credit Agreement with Infinite Funding, Inc. which provides for a non-revolving line of credit. The Company may request advances under the lending facility by issuing borrowing certificates to the Lender. Each borrowing certificate, together with simple interest accrued at 8% per year, becomes payable one year after the date of the advance received. Infinite Funding has amended the Master Credit Agreement, increasing the amount of the Lending Facility from $150,000 to $200,000. As of May 31, 2012, the Company received $190,000 in advances and the Company has accrued $1,375 in interest. As of August 31, 2012, the company has received additional loans in the amounts of $49,470 USD and $104,252 USD. 15 ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following is management's discussion and analysis of certain significant factors that have affected our financial position and operating results during the periods included in the accompanying consolidated financial statements, as well as information relating to the current plans of our management. This report includes forward-looking statements. Generally, the words "believes", "anticipates", "may", "will", "should", "expect", "intend", "estimate", "continue", and similar expressions or the negative thereof or comparable terminology are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, including the matters set forth in this report or other reports or documents we file with the Securities and Exchange Commission from time to time, which could cause actual results or outcomes to differ materially from those projected. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date hereof. We undertake no obligation to update these forward-looking statements. The following discussion and analysis should be read in conjunction with our consolidated financial statements and the related notes thereto and other financial information contained elsewhere in this Form 10-Q. RECENT DEVELOPMENTS On February 29, 2012, the Company formed a new wholly owned subsidiary, Solawerks, Inc. in the state of Nevada, for the purposes of entering the business of marketing specialized solar consumer electronics. On February 29, 2012, the Company entered into a Memorandum of Agreement with Xiamen Taiyang Neng Gongsi and Michael Franklin. For and in consideration of the payment of an initial license fee of $10,000, and for the future payment of royalties, Xiamen granted an exclusive worldwide license and joint patent rights to Domark International, Inc. for a solar charging case for IPAD, including IPAD 3. There is no prior business relationship with Xiamen, or any of its officers or directors. On March 5, 2012, the Company entered into an Asset Purchase Agreement with its controlling shareholder, R. Thomas Kidd, for the sale of its wholly owned subsidiary, Armada/The Golf Championships, and certain assets related thereto. As consideration, the Mr. Kidd returned 9,771,500 shares of common stock to treasury. On March 5, 2012, Michael Franklin purchased 50,000 shares of the Company's Series A Preferred Stock from R Thomas Kidd. Our Series A Preferred Stock is convertible into Common Stock at the rate of 1,000 shares of Common for each share of Preferred. In addition, our Preferred stock has voting rights equivalent to 1,000 votes per share. Upon the conclusion of the Armada transaction, Franklin became the controlling shareholder of Domark by virtue of his ownership of 50,000 shares of Preferred Stock with voting rights equivalent to 50,000,000 shares of our Common Stock. On March 5, 2012, the Company's Shareholders appointed Michael Franklin as sole Director, CEO and Corporate Secretary. Mr. Franklin will serve as a director until his successor has been elected at the next annual meeting of the Company's shareholders or until his earlier resignation, removal, or death. Mr. Franklin has not been appointed to any committees of the Board, as the Board does not presently have any committees. As of March 29, 2012, our prior CEO, Tom Kidd, returned to the Company's treasury, 50,000 shares of its Series A Preferred Stock and 9,771,500 shares of its Common Stock. These shares were then cancelled. There are 50,000 issued and outstanding shares of the Company's Series `A' Preferred Stock, owned by the Company's CEO, Michael Franklin. Effective May 25, 2012, Michael Franklin, Chairman and CEO the Company, resigned from all positions held with the Company, including resigning from Board service. There was no disagreement between the Registrant and Mr. Franklin at the time of his resignation from the Board of Directors. On May 25, 2012, the Company's Shareholders appointed R. Brentwood Strasler as sole Director, President and Corporate Secretary. On June 1, 2012, the Company hired a new CEO, Andy Ritchie. 16 On June 1, 2012, the Company hired a new VP Business Development, Patrick Johnson. On June 20, 2012, the Company signed a long term 3 year license agreement with Barefoot Science. The agreement provided Barefoot with 2,500,000 shares of preferred shares convertible to 2 shares of common for every preferred share held in exchange for rights to Barefoot Science technologies. LIQUIDITY AND CAPITAL RESOURCES Our operating requirements have been funded primarily through financing facilities, sales of our common stock, and loans from shareholders. Currently the Company's cash flows do not adequately support the operating expenses of the Company. We received $0 in fiscal years 2012 and 2011 from the sale of our common stock. The Company will continue to require financing from loans and notes payable until such time our business has generated income sufficient to carry our operating costs. Cash used by operating activities for the three month period ending August 31, 2012 was ($176,939) compared to $(70,558) for the same period 2011. Depreciation and amortization expense for the quarter was $2,619 as compared to $1,968 for period ending August 31, 2011. Cash used in investing activities was $0 for the three month period ending August 31, 2012 compared to $(4,000) for the period ending August 31, 2011. Cash provided by financing activities was $153,722 for the period versus $70,727 for the three month period ending August 31, 2011. Financing activities consisted of cash received from shareholders and notes payable. OTHER CONSIDERATIONS There are numerous factors that affect the Company's business and the results of its operations. Sources of these factors include general economic and business conditions, federal and state regulation of business activities, the level of demand for services, the level and intensity of competition in the, and our ability to continue to improve our infrastructure, including personnel and systems, to keep pace with our anticipated rapid growth in the development of our business. QUARTER ENDED AUGUST 31, 2012 The Company had $20,345 in total revenues for the quarter ended August 31, 2012. Revenues earned for the period were related to sales through the Company's wholly owned subsidiaries Solawerks Inc. $15,752 and Musclefoot Inc. $4,593. General and administrative expenses for the quarter increased to $788,647 from $137,589 for the same period in 2011. The increase is primarily related to salaries and expenses during the period the Company was developing its internet sites. In addition, the Company incurred significant expense in stock compensation and advertising relating to the development of Solawerks Inc. and Musclefoot Inc., the Company's wholly owned subsidiaries. Licensing fees increased by $394,520. Interest expense for the three months ending August 31, 2012 was $0. The Company's operations during fiscal 2012 were funded through interest free, demand notes from shareholders and short term loans financed through Infinite Funding. As of August 31, 2012, the Company is indebted to a shareholder in the amount of $154,772 and to Infinite Funding in the aggregate of $545,645 plus interest. The operating loss for the quarter amounted to ($1,186,799) or a Net loss per share of $0.04 vs. a Net loss per share of $0.00 for the same 3 month period in 2011. 17 ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Not applicable to smaller reporting companies. ITEM 4 - CONTROLS AND PROCEDURES EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES Our management team, under the supervision and with the participation of our principal executive officer and our principal financial officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended ("Exchange Act"), as of the last day of the fiscal period covered by this report, August 31, 2012. The term disclosure controls and procedures means our controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to management, including our principal executive and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were not effective as of August 31, 2012. Our principal executive officer and our principal financial officer, are responsible for establishing and maintaining adequate internal controls over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f). Management is required to base its assessment of the effectiveness of our internal control over financial reporting on a suitable, recognized control framework, such as the framework developed by the Committee of Sponsoring Organizations ("COSO"). The COSO framework, published in INTERNAL CONTROL-INTEGRATED FRAMEWORK, is known as the COSO Report. Our principal executive officer and our principal financial officer have chosen the COSO framework on which to base its assessment. Based on this evaluation, our management concluded that our internal control over financial reporting was not effective as of August 31, 2012. There were no changes in our internal control over financial reporting that occurred during the fiscal year ended August 31, 2012 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting. It should be noted that any system of controls, however well designed and operated, can provide only reasonable and not absolute assurance that the objectives of the system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of certain events. Because of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote. Management is aware that there is a lack of segregation of duties at the Company due to the small number of employees dealing with general administrative and financial matters. However, at this time management has decided that considering the abilities of the employees now involved and the control procedures in place, the risks associated with such lack of segregation are low and the potential benefits of adding employees to clearly segregate duties do not justify the substantial expenses associated with such increases. Management will periodically reevaluate this situation. 18 PART II - OTHER INFORMATION ITEM 1 - LEGAL PROCEEDINGS On May 21, 2009, the Company entered into an Agreement for the Exchange of Common Stock (the "Victory Lane Agreement") with Victory Lane Financial Elite, LLC ("Victory Lane") with respect to a real estate lifestyle business known as Victory Lane (the "Victory Lane Business") pursuant to which the Company intended to purchase the Victory Lane Business. Shortly thereafter, a dispute arose between the Company and Victory Lane regarding alleged miss-representations made by Victory Lane in connection with the Victory Lane Agreement. In August, 2009, Victory Lane Financial Elite, LLC, Legacy Development, LLC and Patrick Costello filed suit in the Superior Court of Tattnall County, Georgia (Civ. No. 2009-V-381-JW) against the Company, R. Thomas Kidd and various officers and directors of the Company, alleging that the Company was in breach of the Victory Lane Agreement and that the Company and certain of the individual defendants had committed various torts against the plaintiffs and that certain of the individual defendants had violated various fiduciary and other duties owed to the plaintiffs in connection with the Victory Lane Agreement and the handling of the Victory Lane Business (the "VLFE Case"). The plaintiffs sought a declaratory judgment to the effect that the Victory Lane Agreement had not been executed, as well as money damages from the Company and the individual defendants. The Company and Mr. Kidd have answered the Complaint, denying any liability for the plaintiff's claims and have asserted various counterclaims including fraud and other torts. In July 2010 the court dismissed all of the individual defendants, other than R. Thomas Kidd, in response to a motion to dismiss for lack of jurisdiction. The case has since been stayed. In December, 2009, AHIFO-21, LLC filed a lawsuit in the Superior Court of Tattnall County, Georgia (Civ. No. 2009-V-672-JS) against Victory Lane, LLC, Patrick J. Costello and Stephen Brown (the "Victory Lane Defendants") alleging that the Victory Lane Defendants owe the plaintiff more than $7,740,000 in respect of one or more loans made by the plaintiff to certain Victory Lane Defendants in connection with the Victory Lane Business (the "AHIFO Case"). In February, 2010, the Victory Lane Defendants filed a Third Party Complaint against the Company and R. Thomas Kidd, claiming that the Company and Mr. Kidd should be liable for any amounts the Victor Lane Defendants are required to pay to the plaintiff in this case. The Company and Mr. Kidd have answered the Complaint, denying any liability for the plaintiff's claims and Mr. Kidd has asserted various counterclaims including fraud and other torts. The Company and Mr. Kidd filed a motion to dismiss the Third Party Complaint, but the entire case was subsequently stayed. Because each of the VLFE Case and the AHIFO Case have been stayed and because discovery in those cases is not complete, the Company has not reached a determination that any loss is other than remote and that the amount of any damages, if any were determined adverse to the Company, would be reasonably estimable. The Company believes that it has meritorious claims against the opposing parties with respect to the Victory Lane Agreement and that the claims asserted against it are not meritorious. The Company intends to defend itself vigorously. On January 24, 2012, the Company was made aware by the Chief Executive Officer of the Company, that a complaint had been filed against the Company for approximately $534,000 by the United States Trustee for the Middle District of Florida to claim against funds we owed to our Chief Executive Officer and his wife. On January 23, 2012, the Trustee's Motion for Approval and Notice of Compromise was filed to obtain the approval of the court of a settlement of the matters that were the subject of the complaint. On April 24, 2012, the Company was advised that the complaint, which was never served, was dismissed with prejudice by the US Trustee. 19 ITEM 1A - RISK FACTORS Not required. ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS None. ITEM 3 - DEFAULTS UPON SENIOR SECURITIES There were no defaults upon senior securities during the interim period ended February 29, 2012. ITEM 4 - MINE SAFETY DISCLOSURE None. ITEM 5 - OTHER INFORMATION None. ITEM 6 - EXHIBITS Exhibit No. Document Description --- -------------------- 31.1 Certification of Ceo Pursuant to 18 U.s.c. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-oxley Act of 2002. 31.2 Certification of Cfo Pursuant to 18 U.s.c. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-oxley Act of 2002. 32.1* Certification of Ceo Pursuant to 18 U.s.c. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-oxleyact of 2002. 32.2* Certification of Cfo Pursuant to 18 U.s.c. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-oxleyact of 2002. 101** Interactive data files pursuant to Rule 405 of Regulation S-T. ---------- * This exhibit shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 of the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings. ** To be filed by Amendment. 20 SIGNATURES In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, there unto duly authorized. DOMARK INTERNATIONAL, INC. Registrant By: /s/ Andrew Ritchie ---------------------------------- Andrew Ritchie Chief Executive Officer Date: October 22, 2012 By: /s/ Andrew Ritchie ---------------------------------- Andrew Ritchie Principal Financial Officer Date: October 22, 2012 Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on the 22nd day of October. /s/ Andrew Ritchie ---------------------------------- Andrew Ritchie Chief Executive Officer /s/ Andrew Ritchie ---------------------------------- Andrew Ritchie Principal Financial Officer 21
EX-31 2 ex31-1.txt EXHIBIT 31.1 CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO RULES 13A-14 AND 15D-14 OF THE SECURITIES EXCHANGE ACT OF 1934 I, Andrew Ritchie, certify that: 1. I have reviewed this report on Form 10-Q of DoMark International, 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 as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are 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) and 15d-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, 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'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's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function): 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'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's internal control over financial reporting. DoMark International, Inc. By /s/ Andrew Ritchie --------------------------------- Andrew Ritchie Chief Executive Officer October 22, 2012 EX-31 3 ex31-2.txt EXHIBIT 31.2 CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO RULES 13A-14 AND 15D-14 OF THE SECURITIES EXCHANGE ACT OF 1934 I, Andrew Ritchie, certify that: 1. I have reviewed this report on Form 10-Q of DoMark International, 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 as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are 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) and 15d-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, 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'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's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function): 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'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's internal control over financial reporting. DoMark International, Inc. By /s/ Andrew Ritchie --------------------------------- Andrew Ritchie Chief Financial Officer October 22, 2012 EX-32 4 ex32-1.txt EXHIBIT 32.1 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 Annual Report of Domark International, Inc. (the "Company") on Form 10-Q for the period ended August 31, 2012 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Andrew Ritchie, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, That to the best of my knowledge: (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. Domark International, Inc. By /s/ Andrew Ritchie ------------------------------------ Andrew Ritchie Chief Executive Officer October 22, 2012 EX-32 5 ex32-2.txt EXHIBIT 32.2 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 Annual Report of Domark International, Inc. (the "Company") on Form 10-Q for the period ended August 31, 2012 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Andrew Ritchie, Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, That to the best of my knowledge: (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. Domark International, Inc. By /s/ Andrew Ritchie ------------------------------------ Andrew Ritchie Principal Financial Officer October 22, 2012 EX-101.INS 6 domk-20120831.xml 10-Q 2012-08-31 false Domark International Inc. 0001365160 --05-31 29540298 Smaller Reporting Company Yes No No 2013 Q1 29052 52269 13611 0 95877 4897 2000000 0 2138540 57166 10000 24799 0 2250 9266 9635 3605480 0 3624746 36684 5763286 93850 138580 89164 40808 15366 545645 545645 725033 650175 154772 1000 154772 1000 879755 651175 50 50 0 0 818000 738000 6000000 0 32046149 31499031 -26850830 -26850830 -7159378 -5972579 4883531 -557326 5763286 93850 29540 29005 0.001 0.001 2000000 2000000 50000 50000 0.001 0.001 2000000 2000000 29540298 29005298 29540298 29005298 20345 0 40274 22976 0 71485 -2631 0 -31211 788647 137589 6600606 0 0 45607 1000 0 101000 0 0 10000 0 0 10000 0 0 4000 -1186799 -137589 -7188945 0 0 29567 -1186799 -137589 -7159378 -0.04 0.00 -0.25 29350896 36953743 29035724 -1186799 -137589 -7159378 2619 1968 13458 14799 0 50000 0 0 5645 0 0 10000 0 0 1000 920175 28153 5544485 0 0 0 0 0 -4000 11020 0 11020 -13611 0 -30537 49416 26000 288351 25442 0 40808 0 14426 0 -176939 -70558 -1230149 0 -4000 -7500 0 -4000 -46500 0 -19273 -125478 0 0 480000 0 0 -100470 153722 70727 1302174 -23217 -3831 25525 4587 3527 756 0 0 -397675 0 0 -16926 0 0 -3868 0 0 -1167 0 0 -24432 0 0 249631 0 0 929738 0 0 50 0 0 9772 0 0 -764380 0.001 0.001 10000000 10000000 394520 0 394520 0 -3516 -3516 0 0 -35000 0 0 -4000 153722 5000 1048122 6000000 0 6000000 0 0 19257 DEVELOPMENT STAGE COMPANY The Company is a development stage company as defined in ASC Standard 915-10-05 and has recognized no revenue and devotes substantially all of its efforts on establishing its online retail and product development business. Its planned principal operations in advancing its online product development business have commenced. All losses accumulated since inception have been considered a part of the Company's development stage activities. <!--egx--><pre>USE OF ESTIMATES</pre><pre>&nbsp;</pre><pre>The preparation of financial statements in conformity with GAAP requires</pre><pre>management to make estimates and assumptions that affect the reported amounts of</pre><pre>assets and liabilities and disclosure of contingent assets and liabilities at</pre><pre>the date of the financial statements. These estimates and assumptions also</pre><pre>affect the reported amounts of revenues, costs and expenses during the reporting</pre><pre>period. Management evaluates these estimates and assumptions on a regular basis.</pre><pre>Actual results could differ from those estimates.</pre><pre>&nbsp;</pre><pre>The primary management estimates included in these financial statements is the</pre><pre>licensing fees, stock option valuation and the fair value of its stock tendered</pre><pre>in various non-monetary transactions.</pre> <!--egx--><pre>CASH AND CASH EQUIVALENTS</pre><pre>&nbsp;</pre><pre>The Company considers all highly liquid investments with an original maturity of</pre><pre>three months or less to be cash equivalents. At August 31, 2012, cash and cash</pre><pre>equivalents included cash on hand and cash in the bank.</pre> <!--egx--><pre>INVENTORIES</pre><pre>&nbsp;</pre><pre>Inventories consist of retail products which are stated at the lower of cost or</pre><pre>market. Cost is determined by the specific identification method.</pre> <!--egx--><pre>FAIR VALUE OF FINANCIAL INSTRUMENTS</pre><pre>&nbsp;</pre><pre>The carrying amounts reflected in the consolidated balance sheets for cash,</pre><pre>accounts payable, and accrued expenses approximate the respective fair values</pre><pre>due to the short maturities of these items.</pre> <!--egx--><pre>PRINCIPLES OF CONSOLIDATION</pre><pre>&nbsp;</pre><pre>The accompanying financial statements represent the consolidated financial</pre><pre>position and results of operations of the Company and include the accounts and</pre><pre>results of operations of the Company and its subsidiaries. The accompanying</pre><pre>financial statements include the active entity of Domark International, Inc. and</pre><pre>its wholly owned subsidiaries, Musclefoot Inc., Solawerks Inc and Domark Canada</pre><pre>Inc. The Company has relied upon the guidance provided by Statements of</pre><pre>Financial Accounting Standards, ASC 810-10-15-3.</pre> <!--egx--><pre>STOCK-BASED COMPENSATION</pre><pre>&nbsp;</pre><pre>The Company accounts for share based payments in accordance with ASC 718,</pre><pre>Compensation - Stock Compensation, which requires all share-based payments to</pre><pre>employees, including grants of employee stock options, to be recognized in the</pre><pre>financial statements based on the grant date fair value of the award. In</pre><pre>accordance with ASC 718-10-30-9, Measurement Objective - Fair Value at Grant</pre><pre>Date, the Company estimates fair value of the award using a valuation technique.</pre><pre>For this purpose, the Company uses the Black-Scholes option pricing model. The</pre><pre>Company believes the model provides the best estimate of fair value due to its</pre><pre>ability to incorporate inputs that change over time, such as volatility and</pre><pre>interest rates, and to allow for actual exercise behavior of option holders.</pre><pre>Compensation cost is recognized over the requisite service period which is</pre><pre>generally equal to the vesting period. Upon exercise, shares issued will be</pre><pre>newly issued shares from authorized common stock.</pre><pre>&nbsp;</pre><pre>ASC 505, "Compensation-Stock Compensation", establishes standards for the</pre><pre>accounting for transactions in which an entity exchanges its equity instruments</pre><pre>to non-employees for goods or services. Under this transition method, stock</pre><pre>compensation expenses includes compensation expense for all stock-based</pre><pre>compensation awards granted on or after January 1, 2006, based on the grant-date</pre><pre>fair value estimated in accordance with provisions of ASC 505.</pre> <!--egx--><pre>NET LOSS PER COMMON SHARE</pre><pre>&nbsp;</pre><pre>The Company computes net loss per share in accordance with the Earning per Share</pre><pre>Topic of the FASB ASC 260. Under the provisions of ASC, basic net loss per share</pre><pre>is computed by dividing the net loss available to common stockholders for the</pre><pre>period by the weighted average number of shares of common stock outstanding</pre><pre>during the period. The calculation of diluted net loss per share gives effect to</pre><pre>common stock equivalents; however, potential common shares are excluded if their</pre><pre>effect is anti-dilutive. As of August 31, 2012, options and warrants were</pre><pre>outstanding and have been valued using Black-Scholes.</pre> <!--egx--><pre>RESEARCH AND DEVELOPMENT</pre><pre>&nbsp;</pre><pre>All research and development expenditures are expensed as incurred. There was no</pre><pre>R&amp;D cost incurred during the Quarter.</pre> <!--egx--><pre>REVENUE RECOGNITION</pre><pre>&nbsp;</pre><pre>The Company recognizes revenues when persuasive evidence of an arrangement</pre><pre>exists, delivery has occurred or services have been rendered, the price is fixed</pre><pre>or determinable, and collection of the resulting receivable is reasonably</pre><pre>assured. Inventory is capitalized and costs of sales are recognized during the</pre><pre>period in which they are sales occurred. The Company derived its revenues for</pre><pre>the period through internet sales of our solar charging units. The Company</pre><pre>recognized these sales once delivery is made from the warehouse (FOB shipping</pre><pre>point).</pre> -1186799 -137589 150000 100000 1.00 2500000 1000 150000 240000 84000 150000 250000 100000 1.00 1.00 1.00 116946 1000 20000 23400 2500000 6000000 394520 425000 382500 100000 50000 68000 34000 29540298 50000 2500000 10000 19495 895 75000 75000 40000 100000 30000 20000 10000 105000 95000 50000 355645 2689 0.03 0.08 200000 190000 1375 49470 104252 <!--egx--><pre>NOTE 1. DESCRIPTION OF BUSINESS</pre><pre>&nbsp;</pre><pre>DOMARK INTERNATIONAL, INC. ("Domark" or the "Company") was incorporated under</pre><pre>the laws of the State of Nevada on March 30, 2006. In 2008, the Company embarked</pre><pre>on a business plan that was intended to acquire profitable businesses that would</pre><pre>create shareholder value in diverse industries. During 2008 and 2009, the</pre><pre>Company acquired several operating businesses, as set forth in various Current</pre><pre>Reports on Form 8-K filed with the Securities and Exchange Commission. On May</pre><pre>21, 2009, the Company closed an acquisition pursuant to an Agreement for the</pre><pre>Exchange of Common Stock (the "Victory Lane Agreement") with Victory Lane</pre><pre>Financial Elite, LLC ("Victory Lane") with respect to a real estate lifestyle</pre><pre>business known as "Victory Lane" (the "Victory Lane Business"). Shortly</pre><pre>thereafter, a dispute arose between the Company and the principals of Victory</pre><pre>Lane regarding the representations of the principals of Victory Lane and the</pre><pre>Victory Lane Business and the Victory Lane Agreement. Litigation between the</pre><pre>Company and various parties pertaining to the Victory Lane Business remains</pre><pre>outstanding. (Refer to Notes 7 - Contingencies &amp; Item II, Other Information</pre><pre>below).</pre><pre>&nbsp;</pre><pre>HISTORY AND GENERAL OVERVIEW</pre><pre>&nbsp;</pre><pre>On February 29, 2012, the Company formed a new wholly owned subsidiary,</pre><pre>Solawerks Inc. in the state of Nevada, for the purposes of entering the business</pre><pre>of marketing specialized solar consumer electronics. Solawerks' current focus is</pre><pre>to develop and distribute the SolaPad: a combined cover and charging system for</pre><pre>Apple's iPad, and the SolaCase: a combined cover and charging system for all</pre><pre>versions of Apple's iPhone. Solawerks competes in a market that also includes 3D</pre><pre>Systems (DDD), Dell (DELL) and Hewlett Packard (HPQ).</pre><pre>&nbsp;</pre><pre>During the last half of 2009, the Company sold two of its operating</pre><pre>subsidiaries, Javaco, Inc. and ECFO Corporation and effected rescissions of</pre><pre>acquisition transactions on the remainder of its operating businesses. Between</pre><pre>October 2009 and May 2011, the Company had no material ongoing operations. The</pre><pre>business of the Company during the period from October 2009 through May 2011 was</pre><pre>to seek out new acquisitions and to conduct the litigation with Victory Lane.</pre><pre>&nbsp;</pre><pre>On March 5, 2012, the Company entered into an Asset Purchase Agreement with its</pre><pre>then controlling shareholder, R. Thomas Kidd, for the sale of Armada, and</pre><pre>certain assets related thereto.</pre><pre>&nbsp;</pre><pre>On May 26, 2012, the Company hired a new Chairman and President Brent Strasler.</pre><pre>He then hired a new Chief Executive Officer Andrew Ritchie on 12 June 2012. The</pre><pre>Company then strengthened the executive team by adding Patrick Johnson as VP -</pre><pre>business development.</pre><pre>&nbsp;</pre><pre>On May 31, 2011, the Company formed a wholly owned subsidiary, Armada Sports &amp;</pre><pre>Entertainment, Inc. Armada is a sports marketing and Management Company engaged</pre><pre>in owning, developing, and conducting made-for-television sports and</pre><pre>entertainment events. On March 5, 2012, the Company entered into an Asset</pre><pre>Purchase Agreement with its then controlling shareholder, R. Thomas Kidd, for</pre><pre>the sale of Armada, and certain assets related thereto.</pre><pre>&nbsp;</pre><pre>In June 2012, the Company entered into a retail sales strategy with North</pre><pre>American retail specialist Chic and Savvy. During the 1st quarter, they attended</pre><pre>many retail sales exhibitions throughout Canada.</pre><pre>&nbsp;</pre><pre>On June 20, 2012, the Company formed a new wholly owned subsidiary, Musclefoot</pre><pre>Inc. in the state of Nevada for the purpose of distributing, marketing, and</pre><pre>acting as sales agent for the patented foot care system, Barefoot Science. This</pre><pre>entity is currently in default under the Nevada Secretary of State.</pre><pre>&nbsp;</pre><pre>On July 20, 2012, the Company formed a new wholly owned subsidiary, Domark</pre><pre>Canada Inc. in the province of Ontario for the purpose of supporting the</pre><pre>corporate operations based in Toronto, Ontario Canada.</pre><pre>&nbsp;</pre><pre>The Company then endorsed world champion triple jumper Will Claye, and US</pre><pre>Olympian Nick Simmons prior to the London 2012 Olympic Games. This was part of a</pre><pre>strategy to obtain global exposure and align brands with world class sports</pre><pre>professionals. We then sponsored several UFC championship contenders.</pre><pre>&nbsp;</pre><pre>As a result of the change in the Company's business model, the disclosures and</pre><pre>financial results contained herein should be reviewed as they relate to the</pre><pre>Company's historical operations but should be discounted as they relate to the</pre> <!--egx--><pre>NOTE 2. GOING CONCERN</pre><pre>&nbsp;</pre><pre>The accompanying financial statements have been prepared in conformity with</pre><pre>accounting principles generally accepted in the United States of America which</pre><pre>contemplate continuation of the Company as a going concern. The Company has</pre><pre>consolidated losses from operations of ($1,186,799) for the 3 months ending</pre><pre>August 31, 2012 compared to a loss of ($137,589) for the same period ending</pre><pre>August 31, 2011. Furthermore, the Company has inadequate working capital to</pre><pre>maintain or develop its operations, and is dependent upon funds from private</pre><pre>investors and the financial support of certain stockholders.</pre><pre>&nbsp;</pre><pre>These factors raise substantial doubt about the ability of the Company to</pre><pre>continue as a going concern. These financial statements do not include any</pre><pre>adjustments relating to the recoverability and classification of recorded asset</pre><pre>amounts, or amounts and classification of liabilities that might result from</pre><pre>this uncertainty. In this regard, management is planning to raise any necessary</pre><pre>additional funds through loans and additional sales of its common stock. There</pre><pre>is no assurance that the Company will be successful in raising additional</pre><pre>capital.</pre> <!--egx--><pre>NOTE 3. BASIS OF PRESENTATION</pre><pre>&nbsp;</pre><pre>The unaudited consolidated financial statements of the Company have been</pre><pre>prepared in accordance with United States generally accepted accounting</pre><pre>principles ("GAAP") for financial information and the rules and regulations of</pre><pre>the Securities and Exchange Commission ("SEC"). In the opinion of management,</pre><pre>all adjustments, consisting of normal recurring accruals considered necessary</pre><pre>for a fair presentation, have been included. Operating results for the three</pre><pre>months ended August 31, 2012 are not necessarily indicative of the results that</pre><pre>may be expected for the year ending May 31, 2013.</pre> <!--egx--><pre>NOTE 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECENT ACCOUNTNG PRONOUNCEMENTS</pre><pre>&nbsp;</pre><pre>The Company has reviewed recently issued accounting pronouncements and plans to</pre><pre>adopt those that are applicable to it. It does not expect the adoption of these</pre><pre>pronouncements to have a material impact on its financial position, results of</pre><pre>operations or cash flows.</pre><pre>&nbsp;</pre><pre>DEVELOPMENT STAGE COMPANY</pre><pre>&nbsp;</pre><pre>The Company is a development stage company as defined in ASC Standard 915-10-05</pre><pre>and has recognized no revenue and devotes substantially all of its efforts on</pre><pre>establishing its online retail and product development business. Its planned</pre><pre>principal operations in advancing its online product development business have</pre><pre>commenced. All losses accumulated since inception have been considered a part of</pre><pre>the Company's development stage activities.</pre><pre>&nbsp;</pre><pre>USE OF ESTIMATES</pre><pre>&nbsp;</pre><pre>The preparation of financial statements in conformity with GAAP requires</pre><pre>management to make estimates and assumptions that affect the reported amounts of</pre><pre>assets and liabilities and disclosure of contingent assets and liabilities at</pre><pre>the date of the financial statements. These estimates and assumptions also</pre><pre>affect the reported amounts of revenues, costs and expenses during the reporting</pre><pre>period. Management evaluates these estimates and assumptions on a regular basis.</pre><pre>Actual results could differ from those estimates.</pre><pre>&nbsp;</pre><pre>The primary management estimates included in these financial statements is the</pre><pre>licensing fees, stock option valuation and the fair value of its stock tendered</pre><pre>in various non-monetary transactions.</pre><pre>&nbsp;</pre><pre>CASH AND CASH EQUIVALENTS</pre><pre>&nbsp;</pre><pre>The Company considers all highly liquid investments with an original maturity of</pre><pre>three months or less to be cash equivalents. At August 31, 2012, cash and cash</pre><pre>equivalents included cash on hand and cash in the bank.</pre><pre>&nbsp;</pre><pre>INVENTORIES</pre><pre>&nbsp;</pre><pre>Inventories consist of retail products which are stated at the lower of cost or</pre><pre>market. Cost is determined by the specific identification method.</pre><pre>&nbsp;</pre><pre>FAIR VALUE OF FINANCIAL INSTRUMENTS</pre><pre>&nbsp;</pre><pre>The carrying amounts reflected in the consolidated balance sheets for cash,</pre><pre>accounts payable, and accrued expenses approximate the respective fair values</pre><pre>due to the short maturities of these items.</pre><pre>&nbsp;</pre><pre>PRINCIPLES OF CONSOLIDATION</pre><pre>&nbsp;</pre><pre>The accompanying financial statements represent the consolidated financial</pre><pre>position and results of operations of the Company and include the accounts and</pre><pre>results of operations of the Company and its subsidiaries. The accompanying</pre><pre>financial statements include the active entity of Domark International, Inc. and</pre><pre>its wholly owned subsidiaries, Musclefoot Inc., Solawerks Inc and Domark Canada</pre><pre>Inc. The Company has relied upon the guidance provided by Statements of</pre><pre>Financial Accounting Standards, ASC 810-10-15-3.</pre><pre>&nbsp;</pre><pre>STOCK-BASED COMPENSATION</pre><pre>&nbsp;</pre><pre>The Company accounts for share based payments in accordance with ASC 718,</pre><pre>Compensation - Stock Compensation, which requires all share-based payments to</pre><pre>employees, including grants of employee stock options, to be recognized in the</pre><pre>financial statements based on the grant date fair value of the award. In</pre><pre>accordance with ASC 718-10-30-9, Measurement Objective - Fair Value at Grant</pre><pre>Date, the Company estimates fair value of the award using a valuation technique.</pre><pre>For this purpose, the Company uses the Black-Scholes option pricing model. The</pre><pre>Company believes the model provides the best estimate of fair value due to its</pre><pre>ability to incorporate inputs that change over time, such as volatility and</pre><pre>interest rates, and to allow for actual exercise behavior of option holders.</pre><pre>Compensation cost is recognized over the requisite service period which is</pre><pre>generally equal to the vesting period. Upon exercise, shares issued will be</pre><pre>newly issued shares from authorized common stock.</pre><pre>&nbsp;</pre><pre>ASC 505, "Compensation-Stock Compensation", establishes standards for the</pre><pre>accounting for transactions in which an entity exchanges its equity instruments</pre><pre>to non-employees for goods or services. Under this transition method, stock</pre><pre>compensation expenses includes compensation expense for all stock-based</pre><pre>compensation awards granted on or after January 1, 2006, based on the grant-date</pre><pre>fair value estimated in accordance with provisions of ASC 505.</pre><pre>&nbsp;</pre><pre>NET LOSS PER COMMON SHARE</pre><pre>&nbsp;</pre><pre>The Company computes net loss per share in accordance with the Earning per Share</pre><pre>Topic of the FASB ASC 260. Under the provisions of ASC, basic net loss per share</pre><pre>is computed by dividing the net loss available to common stockholders for the</pre><pre>period by the weighted average number of shares of common stock outstanding</pre><pre>during the period. The calculation of diluted net loss per share gives effect to</pre><pre>common stock equivalents; however, potential common shares are excluded if their</pre><pre>effect is anti-dilutive. As of August 31, 2012, options and warrants were</pre><pre>outstanding and have been valued using Black-Scholes.</pre><pre>&nbsp;</pre><pre>RESEARCH AND DEVELOPMENT</pre><pre>&nbsp;</pre><pre>All research and development expenditures are expensed as incurred. There was no</pre><pre>R&amp;D cost incurred during the Quarter.</pre><pre>&nbsp;</pre><pre>REVENUE RECOGNITION</pre><pre>&nbsp;</pre><pre>The Company recognizes revenues when persuasive evidence of an arrangement</pre><pre>exists, delivery has occurred or services have been rendered, the price is fixed</pre><pre>or determinable, and collection of the resulting receivable is reasonably</pre><pre>assured. Inventory is capitalized and costs of sales are recognized during the</pre><pre>period in which the sales occurred. The Company derived its revenues for the</pre><pre>period through internet sales of our solar charging units. The Company</pre><pre>recognized these sales once delivery is made from the warehouse (FOB shipping</pre><pre>point).</pre> <!--egx--><pre>NOTE 5. RELATED PARTY TRANSACTIONS</pre><pre>&nbsp;</pre><pre>On February 29, 2012 the Company executed a Memorandum of Agreement with Xiamen</pre><pre>Tiauyang Neng Gongsi and Michael Franklin related to the acquisition of certain</pre><pre>exclusive worldwide licensing and joint patent rights.</pre><pre>&nbsp;</pre><pre>On May 25, 2012, the Company entered into an employment agreement with an</pre><pre>effective date of June 1, 2012 with its newly appointed President, R. Brentwood</pre><pre>Strasler, for a period of no less than three years. Mr. Strasler is entitled to</pre><pre>an annual salary of $150,000 and 100,000 stock purchase warrants exercisable to</pre><pre>purchase common shares of the Company at $1.00 per share. The warrants are</pre><pre>exercisable for a three year period and can be vested quarterly on a pro rata</pre><pre>basis over twelve months from the date of issue. Additionally, Mr. Strasler will</pre><pre>be enrolled in a long term Executive Option Plan no later than three months</pre><pre>after the effective date of the employment agreement and is entitled to term</pre><pre>life insurance in the face amount of $2,500,000, payable to the beneficiary</pre><pre>designated by Mr. Strasler. The warrants awarded will be valued in accordance</pre><pre>with ASC 718-10-30-9, Measurement Objective - Fair Value at Grant Date. The</pre><pre>Company estimates fair value of the award using the Black-Scholes option pricing</pre><pre>model.</pre><pre>&nbsp;</pre><pre>The Company is indebted to Michael Franklin, previously President of our wholly</pre><pre>owned subsidiary Solawerks, Inc., in the amount of $1,000 for monies advanced to</pre><pre>the Company to initiate the initial opening of the Sun Trust bank account. This</pre><pre>loan is non-interest bearing and payable upon demand.</pre> <!--egx--><pre>NOTE 6. SHAREHOLDERS' EQUITY</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; On May 25, 2012, - R Brentwood Strasler was appointed as Chairman and</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; President / Director, with an annual compensation of $150,000 and 150,000</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; share options at $1.00 which will vest in one year on a quarterly basis.</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; The Company valued the options using the Black-Scholes valuation model. As</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; of the grant date the options were valued at $175,419.</pre><pre>&nbsp;</pre><pre>DoMark International Inc. Announces Appointment of New President</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; On Jun 18, 2012, - Andrew Ritchie was appointed as Chief Executive Officer/</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Director with an annual Compensation of $240,000 and 250,000 share options</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; at $1.00 which will vest in one year on a quarterly basis. The Company</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; valued the options using the Black-Scholes valuation model. As of the grant</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; date the options were valued at $175,414.</pre><pre>&nbsp;</pre><pre>DoMark International Inc. Announces Appointment of New Chief Executive Officer</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; On Jun 21, 2012, - Domark signed a contract with Barefoot-Science to become</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; exclusive marketing direct sales distributor for North America. Barefoot -</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Science will be issued 2,500,000 shares of Preferred B shares of Domark</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; International Inc. which are convertible at any time at request of holder</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; into common A shares at a 1 Preferred Series B into 2 Common shares ratio.</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Shares will hold a six month restriction under 144 rules. The shares have</pre><pre> &nbsp;&nbsp;&nbsp;&nbsp;been valued at $6,000,000 USD which will be expensed over the term of the</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; agreement (3 years). As of August 31, 2012, $394,520 USD has been expensed.</pre><pre>&nbsp;</pre><pre>DoMark International, Inc. Enters Into Multi-Billion Dollar Footwear and Foot</pre><pre>Care Markets with Industry Changing Technology From Barefoot Sciences Inc.</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; On Jun 26, 2012, - Patrick Johnson was appointed as Vice President of</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Business Development, with an annual compensation of $84,000 and 100,000</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; share options at $1.00 which will vest in one year on a quarterly basis.</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; The Company valued the options using the Black-Scholes valuation model. As</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; of the grant date the options were valued at $116,946.</pre><pre>&nbsp;</pre><pre>DoMark International Inc. Announces Appointment of All-Star Athlete and Super</pre><pre>Bowl Champion as VP - Corporate Development</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; On Jun 26, 2012,- RBL were appointed to look after all Domarks Social media</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; campaigns. They were awarded a contract of $1,000 a month and were granted</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; 20,000 free trading shares in Domark international valued at $23,400.</pre><pre>&nbsp;</pre><pre>DoMark International Inc. Announces Appointments RBL Communications as social</pre><pre>media agent.</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; On July 11, 2012 - Ian Nuttall received an additional 425,000 shares as a</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; consultant to Domark of Rule 144 common `A' stock in Domark International</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Inc. valued at $382,500.</pre><pre>&nbsp;</pre><pre>On Jul 19, 2012, - Domark signs Nick Symmonds to endorse Domark products for</pre><pre>compensation of 100,000 shares of rule144 common A stock in Domark International</pre><pre>Inc. valued at $68,000.</pre><pre>&nbsp;</pre><pre>DoMark Signs Five-Time American 800 m Champion Nick Symmonds to Endorsement Deal</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; On Jul 25, 2012, - Domark signs Will Claye to endorse Domark products for</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; compensation of 50,000 shares of rule144 common A stock in Domark</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; International Inc.valued at $34,000.</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; Strasler. The warrants awarded will be valued in accordance with ASC</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; 718-10-30-9, Measurement Objective - Fair Value at Grant Date. The Company</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; estimates fair value of the award using the Black-Scholes option pricing</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; model. Since the effective date of the grant is June 1, 2012, the Company</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; did not realize or record an estimated fair value of the warrants and</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; therefore there is no impact to the financial statements for the fiscal</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; period ending May 31, 2012.</pre><pre>&nbsp;</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Our common stock is traded in the over-the-counter market, and quoted in</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; the National Association of Securities Dealers Inter-dealer Quotation</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; System ("Electronic Bulletin Board) and can be accessed on the Internet at</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; www.otcbb.com under the symbol "DOMK.OB".</pre><pre>&nbsp;</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; As of August 31, 2012, there were 29,540,298 shares of our common stock</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; outstanding and 50,000 shares of Preferred Series A (1000:1 conversion)and</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; 2,500,000 shares of Preferred Series B (2:1 conversion). There were</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; approximately 84 shareholders of record of the Company's common stock.</pre> <!--egx--><pre>NOTE 7. CONTINGENCIES</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; On May 21, 2009, the Company entered into that certain Agreement for the</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Exchange of Common Stock (the "Victory Lane Agreement") with Victory Lane</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Financial Elite, LLC ("Victory Lane") with respect to a real estate</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; lifestyle business known as Victory Lane (the "Victory Lane Business")</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; pursuant to which the Company intended to purchase the Victory Lane</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Business. Shortly thereafter, a dispute arose between the Company and</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Victory Lane regarding alleged mis-representations made by Victory Lane in</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; connection with the Victory Lane Agreement.</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; In August, 2009, Victory Lane Financial Elite, LLC, Legacy Development, LLC</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; and Patrick Costello filed suit in the Superior Court of Tattnall County,</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Georgia (Civ. No. 2009-V-381-JW) against the Company, R. Thomas Kidd and</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; various officers and directors of the Company, alleging that the Company</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; was in breach of the Victory Lane Agreement and that the Company and</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; certain of the individual defendants had committed various torts against</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; the plaintiffs and that certain of the individual defendants had violated</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; various fiduciary and other duties owed to the plaintiffs in connection</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; with the Victory Lane Agreement and the handling of the Victory Lane</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Business (the "VLFE Case"). The plaintiffs sought a declaratory judgment to</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; the effect that the Victory Lane Agreement had not been executed, as well</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; as money damages from the Company and the individual defendants. The</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Company and Mr. Kidd have answered the Complaint, denying any liability for</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; the plaintiff's claims and have asserted various counterclaims including</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; fraud and other torts. In July 2010 the court dismissed all of the</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; individual defendants, other than R. Thomas Kidd, in response to a motion</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; to dismiss for lack of jurisdiction. The case has since been stayed.</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; In December, 2009, AHIFO-21, LLC filed a lawsuit in the Superior Court of</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Tattnall County, Georgia (Civ. No. 2009-V-672-JS) against Victory Lane,</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; LLC, Patrick J. Costello and Stephen Brown (the "Victory Lane Defendants")</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; alleging that the Victory Lane Defendants owe the plaintiff more than</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; $7,740,000 in respect of one or more loans made by the plaintiff to certain</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; of the Victory Lane Defendants in connection with the Victory Lane Business</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; (the "AHIFO Case"). In February, 2010, the Victory Lane Defendants filed a</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Third Party Complaint against the Company and R. Thomas Kidd, claiming that</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; the Company and Mr. Kidd should be liable for any amounts the Victor Lane</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Defendants are required to pay to the plaintiff in this case. The Company</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; and Mr. Kidd have answered the Complaint, denying any liability for the</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; plaintiff's claims and have asserted various counterclaims including fraud</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; and other torts. The Company and Mr. Kidd filed a motion to dismiss the</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Third Party Complaint, but the entire case was subsequently stayed.</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; Because each of the VLFE Case and the AHIFO Case have been stayed and</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; because discovery in those cases is not complete, the Company has not</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; reached a determination that any loss is other than remote and that the</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; amount of any damages, if any were determined adverse to the Company, would</pre><pre>&nbsp;</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; be reasonably estimable. The Company believes that it has meritorious</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; claims against the opposing parties with respect to the Victory Lane</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Agreement and that the claims asserted against it are not meritorious. The</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Company intends to defend itself vigorously.</pre> <!--egx--><pre>NOTE 8. COMMITMENTS</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; On Jul 16, 2012, - Leading specialist Sports physio was appointed to</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Domarks advisory committee with a signing agreement of $10,000. DoMark</pre><pre>&nbsp; &nbsp;&nbsp;&nbsp;International Inc. Appoints Sean Pena to Advisory Committee</pre><pre>&nbsp;</pre><pre>*&nbsp;&nbsp;&nbsp; On Jun 28, 2012, - Domark donates a Noraxon foot Scanner to Sean Penna to</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; assist in the training of the U.S Olympic team. The machine cost $19,495,</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; and is being purchased through a rental buy agreement of $895 a month.</pre><pre>&nbsp;</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; Donates Performance Enhancing Technology by Noraxon to Assist Physio Expert</pre><pre>&nbsp;&nbsp;&nbsp;&nbsp; to World's Top Track Athletes in Preparation for the 2012 Olympic Games</pre> <!--egx--><pre>NOTE 9. LIABILITIES &amp; NOTES PAYABLE</pre><pre>&nbsp;</pre><pre>On February 29, 2012, Company entered into a Promissory Note with R. Thomas</pre><pre>Kidd, our then Chief Executive Officer of the Company, and Infinite Funding,</pre><pre>Inc. ("IFI"). This Note replaces four promissory notes issued by IFI to the</pre><pre>Company as more fully described below.</pre><pre>&nbsp;</pre><pre>Effective March 3, 2011, we obtained an unsecured loan in the amount of $75,000</pre><pre>from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note from the</pre><pre>Company to Infinite Funding, Inc. dated March 3, 2011 (the "IFI Note"). The Note</pre><pre>was amended three times to extend the due date and was first amended on June 9,</pre><pre>2011, a second time on September 28, 2011, and a third amendment on December 9,</pre><pre>2011. Pursuant to the amendments, the Company agreed to pay extension fees of</pre><pre>$30,000, thereby increasing the principle balance of this Note to $105,000.</pre><pre>&nbsp;</pre><pre>Effective June 10, 2011, we obtained an unsecured loan in the amount of $75,000</pre><pre>from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note from the</pre><pre>Company to Infinite Funding, Inc. dated June 10, 2011 (the "IFI Note"). The Note</pre><pre>was amended two times to extend the due date and was first amended on September</pre><pre>28, 2011 and again on December 9, 2011. Pursuant to the amendments, the Company</pre><pre>agreed to pay extension fees of $20,000, thereby increasing the principle</pre><pre>balance of this Note to $95,000.</pre><pre>&nbsp;</pre><pre>Effective September 28, 2011, we obtained an unsecured loan in the amount of</pre><pre>$40,000 from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note</pre><pre>from the Company to Infinite Funding, Inc. dated September 28, 2011 (the "IFI</pre><pre>Note"). The Note was amended to extend the due date on December 9, 2011.</pre><pre>Pursuant to this amendment, the Company agreed to pay an extension fee of</pre><pre>$10,000, thereby increasing the principle balance of this Note to $50,000.</pre><pre>&nbsp;</pre><pre>Effective December 9, 2011, we obtained an unsecured loan in the amount of</pre><pre>$100,000 from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note</pre><pre>from the Company to Infinite Funding, Inc. dated December 9, 2011 (the "IFI</pre><pre>Note").</pre><pre>&nbsp;</pre><pre>As a result of consolidating the aforementioned debt, the Company is now</pre><pre>obligated under a single Promissory Note dated February 29, 2012 in the</pre><pre>aggregate principle amount of $355,645 along with $2,689 in accrued interest.</pre><pre>The Note is due on October 15, 2012 and accrues interest at 3% per annum. In</pre><pre>addition, R Thomas Kidd executed a Personal Guarantee of the Note, whereby Kidd</pre><pre>guarantees the payment of $100,000 of the principle balance in an Event of</pre><pre>Default pursuant to Article III of the Note.</pre><pre>&nbsp;</pre><pre>MASTER CREDIT AGREEMENTS</pre><pre>&nbsp;</pre><pre>On March 2, 2012, the Company entered into a Master Credit Agreement with</pre><pre>Infinite Funding, Inc. which provides for a non-revolving line of credit. The</pre><pre>Company may request advances under the lending facility by issuing borrowing</pre><pre>certificates to the Lender. Each borrowing certificate, together with simple</pre><pre>interest accrued at 8% per year, becomes payable one year after the date of the</pre><pre>advance received. Infinite Funding has amended the Master Credit Agreement,</pre><pre>increasing the amount of the Lending Facility from $150,000 to $200,000. As of</pre><pre>May 31, 2012, the Company received $190,000 in advances and the Company has</pre><pre>accrued $1,375 in interest. </pre><pre>&nbsp;</pre><pre>As of August 31, 2012, the company has received additional loans in the amounts</pre><pre>of $49,470 USD and $104,252 USD.</pre> 0001365160 2012-06-01 2012-08-31 0001365160 2012-08-31 0001365160 2012-05-31 0001365160 2011-06-01 2011-08-31 0001365160 2009-10-21 2012-08-31 0001365160 2011-05-31 0001365160 2009-10-20 0001365160 2011-08-31 0001365160 2012-05-25 0001365160 2012-06-18 0001365160 2012-06-21 0001365160 2012-06-26 0001365160 2012-07-11 0001365160 2012-07-19 0001365160 2012-07-25 0001365160 2012-07-16 0001365160 2012-07-28 0001365160 2011-03-03 0001365160 2011-06-10 0001365160 2011-09-28 0001365160 2011-12-09 0001365160 2012-02-29 0001365160 2012-10-15 0001365160 2012-03-02 shares iso4217:USD iso4217:USD shares pure EX-101.SCH 7 domk-20120831.xsd 000120 - Disclosure - CONTINGENCIES link:presentationLink link:definitionLink link:calculationLink 000190 - Statement - COMMITMENTS CONSISTS OF THE FOLLOWING (Details) link:presentationLink link:definitionLink link:calculationLink 000170 - Statement - RELATED PARTY TRANSACTIONS CONSISTS OF THE FOLLOWING (Details) link:presentationLink link:definitionLink link:calculationLink 000110 - Disclosure - SHAREHOLDERS EQUITY link:presentationLink link:definitionLink link:calculationLink 000140 - Disclosure - LIABILITIES AND NOTES PAYABLE link:presentationLink link:definitionLink link:calculationLink 000090 - Disclosure - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECENT ACCOUNTNG PRONOUNCEMENTS link:presentationLink link:definitionLink link:calculationLink 000180 - Statement - EQUITY TRANSACTIONS CONSISTS OF THE FOLLOWING (Details) link:presentationLink link:definitionLink link:calculationLink 000160 - Statement - GOING CONCERN AND LOSS (Details) link:presentationLink link:definitionLink link:calculationLink 000200 - Statement - LIABILITIES AND NOTES PAYABLE CONSISTS OF THE FOLLOWING (Details) link:presentationLink link:definitionLink link:calculationLink 000070 - Disclosure - GOING CONCERN link:presentationLink link:definitionLink link:calculationLink 000060 - Disclosure - DESCRIPTION OF BUSINESS link:presentationLink link:definitionLink link:calculationLink 000010 - Document - Document and Entity Information link:presentationLink link:definitionLink link:calculationLink 000080 - Disclosure - BASIS OF PRESENTATION link:presentationLink link:definitionLink link:calculationLink 000020 - Statement - CONSOLIDATED BALANCE SHEETS (unaudited) link:presentationLink link:definitionLink link:calculationLink 000030 - Statement - CONSOLIDATED BALANCE SHEETS PARENTHETICALS link:presentationLink link:definitionLink link:calculationLink 000210 - Statement - MASTER CREDIT AGREEMENT CONSISTS OF THE FOLLOWING (Details) link:presentationLink link:definitionLink link:calculationLink 000100 - Disclosure - RELATED PARTY TRANSACTIONS link:presentationLink link:definitionLink link:calculationLink 000050 - Statement - CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) link:presentationLink link:definitionLink link:calculationLink 000150 - Disclosure - ACCOUNTING POLICIES (Policies) link:presentationLink link:definitionLink link:calculationLink 000130 - Disclosure - COMMITMENTS link:presentationLink link:definitionLink link:calculationLink 000040 - Statement - CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) link:presentationLink link:definitionLink link:calculationLink EX-101.CAL 8 domk-20120831_cal.xml EX-101.DEF 9 domk-20120831_def.xml EX-101.LAB 10 domk-20120831_lab.xml Note is due on October 15, 2012 and accrues interest rate per annum Note is due on October 15, 2012 and accrues interest rate per annum LIABILITIES AND NOTES PAYABLE CONSISTS OF THE FOLLOWING: Machine cost Amount, as of the balance sheet date, of long-lived, depreciable assets Shares valued at Shares valued at RESEARCH AND DEVELOPMENT SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECENT ACCOUNTNG PRONOUNCEMENTS {1} SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECENT ACCOUNTNG PRONOUNCEMENTS GOING CONCERN {1} GOING CONCERN Inventory {1} Inventory Gain on sale of assets Depreciation and amortization Accumulated Deficit during development stage LIABILITIES AND STOCKHOLDERS' DEFICIENCY TOTAL CURRENT ASSETS TOTAL CURRENT ASSETS Prepaid expenses Current Fiscal Year End Date Simple interest accrued per year Simple interest accrued per year Accrued interest on principle amount Sports physio was appointed with a signing agreement Sports physio was appointed with a signing agreement Common shares per share Face amount or stated value of common stock per share; generally not indicative of the fair market value per share. PRINCIPLES OF CONSOLIDATION DEVELOPMENT STAGE COMPANY CONTINGENCIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECENT ACCOUNTNG PRONOUNCEMENTS Cash paid for web development Increase inventory Changes in operating assets and liabilities: Bad debt expense {1} Bad debt expense Amount of the current period expense charged against operations, the offset which is generally to the allowance for doubtful accounts for the purpose of reducing receivables, including notes receivable, to an amount that approximates their net realizable value (the amount expected to be collected). Net loss Preferred Series B stock payable Carrying value as of the balance sheet date of Preferred Series B stock payable Due to affiliate and shareholder TOTAL ASSETS TOTAL ASSETS ASSETS Document Fiscal Period Focus Entity Filer Category EQUITY TRANSACTIONS CONSISTS OF THE FOLLOWING: BASIS OF PRESENTATION Proceeds received from shareholder loans Cost of sales Website development costs, net Website development costs incurred for development of computer software, which is to be sold, leased or otherwise marketed, after establishing technological feasibility through to the general release of the software products. Deferred financing costs Received advances CASH FLOWS FROM INVESTING ACTIVITIES Convertible preferred stock series A, shares authorized Additional paid-in capital Common stock payable Aggregate value as of the balance sheet date of common stock payable Prepaid Licensee fees long-term Receivedadditional loans in the amounts Options were valued at Options were valued at Patrick Johnson was appointed with an annual compensation Patrick Johnson was appointed with an annual compensation Employment agreement with newly appointed President entitled to an annual salary Employment agreement with newly appointed President entitled to an annual salary Increase in accounts payable-related party Forgiveness of debt LONG-TERM LIABILITIES Shares of common stock outstanding Total number of shares of common stock held by shareholders. May be all or portion of the number of common shares authorized. These shares represent the ownership interest of the common shareholders. Shares outstanding equals shares issued minus shares held in treasury and other adjustments, if any. common `A' stock in Domark International valued at common `A' stock in Domark International value Issued Preferred B shares Total number of nonredeemable preferred shares (or preferred stock redeemable solely at the option of the issuer) issued to shareholders (includes related preferred shares that were issued, repurchased, and remain in the treasury). May be all or portion of the number of preferred shares authorized. Excludes preferred shares that are classified as debt. NET LOSS PER COMMON SHARE CASH AND CASH EQUIVALENTS POLICY LIABILITIES AND NOTES PAYABLE RELATED PARTY TRANSACTIONS {1} RELATED PARTY TRANSACTIONS Prepaid expenses {1} Prepaid expenses Payments made on notes payable CASH FLOWS FROM OPERATING ACTIVITIES Common Stock, shares outstanding TOTAL STOCKHOLDERS' DEFICIENCY TOTAL STOCKHOLDERS' DEFICIENCY Convertible preferred stock series B, $0.001 par value, Authorized: 10,000,000 Aggregate par or stated value of issued nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer). This item includes treasury stock repurchased by the entity. Note: elements for number of nonredeemable preferred shares, par value and other disclosure concepts are in another section within stockholders' equity. Document Fiscal Year Focus Amendment Description Shares of Preferred Series B outstanding Aggregate share number for additional series of nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer) held by stockholders, which is net of related treasury stock. DESCRIPTION OF BUSINESS Proceeds received from notes payable Cash paid for licensing Cash paid for licensing during the period NET CASH USED IN OPERATING ACTIVITIES NET CASH USED IN OPERATING ACTIVITIES Decrease prepaid exp and other current assets REVENUES: Total Long-term Liabilities Total Long-term Liabilities Prepaid Licensee fee Entity Well-known Seasoned Issuer Document Type Increasing the amount of the Lending Facility from Increasing the amount of the Lending Facility from Increasing the amount of the Lending Facility Common A stock in Domark International Inc. valued at Common A stock in Domark International Inc. valued Ian Nuttall received an additional shares Ian Nuttall received an additional shares RELATED PARTY TRANSACTIONS CONSISTS OF THE FOLLOWING: COMMITMENTS SHAREHOLDERS EQUITY Prepaid license fees Noncash investing and financing activitiesPrepaid license fees during the period Impairment of assets Net Loss Net Loss Gross Profit Gross Profit Parentheticals Common Stock, $0.001 par value, Authorized: 200,000,000 Issued: 29,540,298 and 29,005,298, respectively CURRENT LIABILITIES XSE license, net Carrying amount as of the balance sheet date for the capitalized costs to acquire rights under a license arrangement USE OF ESTIMATES COMMITMENTS {1} COMMITMENTS RELATED PARTY TRANSACTIONS GOING CONCERN Additional capital contributed in excess of net assets sold Non cass investing and financing activities Additional capital contributed in excess of net assets sold Increase in accrued expenses Common Stock, shares issued STOCKHOLDERS' DEFICIT Will Claye to endorse Domark products for compensation Will Claye to endorse Domark products for compensation Nick Symmonds to endorse Domark products for compensation Nick Symmonds to endorse Domark products for compensation Free trading shares valued Free trading shares valued Share options per share Share options per share Consolidated losses from operations The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest. REVENUE RECOGNITION LIABILITIES AND NOTES PAYABLE {1} LIABILITIES AND NOTES PAYABLE Fixed assets, net of depreciation Impairment of goodwill Research and development TOTAL CURRENT LIABILITIES TOTAL CURRENT LIABILITIES Notes payable Document Period End Date Andrew Ritchie was appointed with an annual Compensation License, net of amortization Decrease in deferred financing costs Decrease in deferred financing costs during the period Forgiveness of debt {1} Forgiveness of debt Common stock issued as compensation and for expenses Non cash interest Net loss per share, basic and diluted Other Income {1} Other Income REVENUE Accounts payable and accrued expenses Expensed over the term of the agreement Expensed over the term of the agreement Indebted to Michael Franklin in the amount Indebted to Michael Franklin in the amount FAIR VALUE OF FINANCIAL INSTRUMENTS CONTINGENCIES {1} CONTINGENCIES DESCRIPTION OF BUSINESS {1} DESCRIPTION OF BUSINESS Net increase (decrease) in cash and cash equivalents Net increase (decrease) in cash and cash equivalents Adjustments to reconcile net loss to net cash used in operating activities: Common Stock, par value Convertible preferred stock series A, shares issued Statement [Line Items] Entity Common Stock, Shares Outstanding Obtained an unsecured loan GOING CONCERN AND LOSS: ACCOUNTING POLICIES SHAREHOLDERS EQUITY {1} SHAREHOLDERS EQUITY Return of preferred shares, par value Non cass investing and financing activities Return of preferred shares, par value Due to affiliates and shareholder Amount of payable due to an entity that is affiliated with the reporting entity by means of direct or indirect ownership. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer). SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: Impairment of asset Bad debt expense TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY TOTAL LIABILITIES TOTAL LIABILITIES TOTAL OTHER ASSETS TOTAL OTHER ASSETS OTHER ASSETS Entity Current Reporting Status Entity Public Float Entity Registrant Name Accrued in interest amount Shares of Preferred Series A outstanding Aggregate share number for additional series of nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer) held by stockholders, which is net of related treasury stock. STOCK BASED COMPENSATION POLICY Payroll & related liabilities Website costs, net of amortization CASH FLOWS FROM FINANCING ACTIVITIES Weighted average common shares outstanding Accounts payable - related party Inventory Granted free trading shares Granted free trading shares Life insurance in the face amount payable to the beneficiary designated by Mr. Strasler Life insurance in the face amount payable to the beneficiary designated by Mr. Strasler BASIS OF PRESENTATION {1} BASIS OF PRESENTATION License Fees Amount of expense related to license during the period CURRENT ASSETS Statement [Table] Received additional loans in amount MASTER CREDIT AGREEMENT CONSISTS OF THE FOLLOWING: Consolidated debt under a single Promissory Note Rental agreement per month Rental agreement per month Annual compensation of share options R Brentwood Strasler was appointed with an annual compensation Stock purchase warrants exercisable Indebted to Michael Franklin in the amount Return of common stock, par value Return of common stock, par value in noncash financing activities. 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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECENT ACCOUNTNG PRONOUNCEMENTS
3 Months Ended
Aug. 31, 2012
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECENT ACCOUNTNG PRONOUNCEMENTS  
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECENT ACCOUNTNG PRONOUNCEMENTS
NOTE 4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES RECENT ACCOUNTNG PRONOUNCEMENTS
 
The Company has reviewed recently issued accounting pronouncements and plans to
adopt those that are applicable to it. It does not expect the adoption of these
pronouncements to have a material impact on its financial position, results of
operations or cash flows.
 
DEVELOPMENT STAGE COMPANY
 
The Company is a development stage company as defined in ASC Standard 915-10-05
and has recognized no revenue and devotes substantially all of its efforts on
establishing its online retail and product development business. Its planned
principal operations in advancing its online product development business have
commenced. All losses accumulated since inception have been considered a part of
the Company's development stage activities.
 
USE OF ESTIMATES
 
The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements. These estimates and assumptions also
affect the reported amounts of revenues, costs and expenses during the reporting
period. Management evaluates these estimates and assumptions on a regular basis.
Actual results could differ from those estimates.
 
The primary management estimates included in these financial statements is the
licensing fees, stock option valuation and the fair value of its stock tendered
in various non-monetary transactions.
 
CASH AND CASH EQUIVALENTS
 
The Company considers all highly liquid investments with an original maturity of
three months or less to be cash equivalents. At August 31, 2012, cash and cash
equivalents included cash on hand and cash in the bank.
 
INVENTORIES
 
Inventories consist of retail products which are stated at the lower of cost or
market. Cost is determined by the specific identification method.
 
FAIR VALUE OF FINANCIAL INSTRUMENTS
 
The carrying amounts reflected in the consolidated balance sheets for cash,
accounts payable, and accrued expenses approximate the respective fair values
due to the short maturities of these items.
 
PRINCIPLES OF CONSOLIDATION
 
The accompanying financial statements represent the consolidated financial
position and results of operations of the Company and include the accounts and
results of operations of the Company and its subsidiaries. The accompanying
financial statements include the active entity of Domark International, Inc. and
its wholly owned subsidiaries, Musclefoot Inc., Solawerks Inc and Domark Canada
Inc. The Company has relied upon the guidance provided by Statements of
Financial Accounting Standards, ASC 810-10-15-3.
 
STOCK-BASED COMPENSATION
 
The Company accounts for share based payments in accordance with ASC 718,
Compensation - Stock Compensation, which requires all share-based payments to
employees, including grants of employee stock options, to be recognized in the
financial statements based on the grant date fair value of the award. In
accordance with ASC 718-10-30-9, Measurement Objective - Fair Value at Grant
Date, the Company estimates fair value of the award using a valuation technique.
For this purpose, the Company uses the Black-Scholes option pricing model. The
Company believes the model provides the best estimate of fair value due to its
ability to incorporate inputs that change over time, such as volatility and
interest rates, and to allow for actual exercise behavior of option holders.
Compensation cost is recognized over the requisite service period which is
generally equal to the vesting period. Upon exercise, shares issued will be
newly issued shares from authorized common stock.
 
ASC 505, "Compensation-Stock Compensation", establishes standards for the
accounting for transactions in which an entity exchanges its equity instruments
to non-employees for goods or services. Under this transition method, stock
compensation expenses includes compensation expense for all stock-based
compensation awards granted on or after January 1, 2006, based on the grant-date
fair value estimated in accordance with provisions of ASC 505.
 
NET LOSS PER COMMON SHARE
 
The Company computes net loss per share in accordance with the Earning per Share
Topic of the FASB ASC 260. Under the provisions of ASC, basic net loss per share
is computed by dividing the net loss available to common stockholders for the
period by the weighted average number of shares of common stock outstanding
during the period. The calculation of diluted net loss per share gives effect to
common stock equivalents; however, potential common shares are excluded if their
effect is anti-dilutive. As of August 31, 2012, options and warrants were
outstanding and have been valued using Black-Scholes.
 
RESEARCH AND DEVELOPMENT
 
All research and development expenditures are expensed as incurred. There was no
R&D cost incurred during the Quarter.
 
REVENUE RECOGNITION
 
The Company recognizes revenues when persuasive evidence of an arrangement
exists, delivery has occurred or services have been rendered, the price is fixed
or determinable, and collection of the resulting receivable is reasonably
assured. Inventory is capitalized and costs of sales are recognized during the
period in which the sales occurred. The Company derived its revenues for the
period through internet sales of our solar charging units. The Company
recognized these sales once delivery is made from the warehouse (FOB shipping
point).
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BASIS OF PRESENTATION
3 Months Ended
Aug. 31, 2012
BASIS OF PRESENTATION  
BASIS OF PRESENTATION
NOTE 3. BASIS OF PRESENTATION
 
The unaudited consolidated financial statements of the Company have been
prepared in accordance with United States generally accepted accounting
principles ("GAAP") for financial information and the rules and regulations of
the Securities and Exchange Commission ("SEC"). In the opinion of management,
all adjustments, consisting of normal recurring accruals considered necessary
for a fair presentation, have been included. Operating results for the three
months ended August 31, 2012 are not necessarily indicative of the results that
may be expected for the year ending May 31, 2013.
XML 16 R2.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONSOLIDATED BALANCE SHEETS (unaudited) (USD $)
Aug. 31, 2012
May 31, 2012
CURRENT ASSETS    
Cash $ 29,052 $ 52,269
Inventory 13,611 0
Prepaid expenses 95,877 4,897
Prepaid Licensee fee 2,000,000 0
TOTAL CURRENT ASSETS 2,138,540 57,166
OTHER ASSETS    
Deferred financing costs 10,000 24,799
Website development costs, net 0 2,250
XSE license, net 9,266 9,635
Prepaid Licensee fees long-term 3,605,480 0
TOTAL OTHER ASSETS 3,624,746 36,684
TOTAL ASSETS 5,763,286 93,850
CURRENT LIABILITIES    
Accounts payable and accrued expenses 138,580 89,164
Accounts payable - related party 40,808 15,366
Notes payable 545,645 545,645
TOTAL CURRENT LIABILITIES 725,033 650,175
LONG-TERM LIABILITIES    
Due to affiliate and shareholder 154,772 1,000
Total Long-term Liabilities 154,772 1,000
TOTAL LIABILITIES 879,755 651,175
STOCKHOLDERS' DEFICIT    
Convertible preferred stock series A, $0.001 par value, Authorized: 2,000,000 Issued: 50,000 and 50,000 as of August 31, 2012 and May 31, 2012, respectively 50 50
Convertible preferred stock series B, $0.001 par value, Authorized: 10,000,000 0 0
Common Stock, $0.001 par value, Authorized: 200,000,000 Issued: 29,540,298 and 29,005,298, respectively 29,540 29,005
Common stock payable 818,000 738,000
Preferred Series B stock payable 6,000,000 0
Additional paid-in capital 32,046,149 31,499,031
Accumulated deficit (26,850,830) (26,850,830)
Accumulated Deficit during development stage (7,159,378) (5,972,579)
TOTAL STOCKHOLDERS' DEFICIENCY 4,883,531 (557,326)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY $ 5,763,286 $ 93,850
XML 17 R6.htm IDEA: XBRL DOCUMENT v2.4.0.6
DESCRIPTION OF BUSINESS
3 Months Ended
Aug. 31, 2012
DESCRIPTION OF BUSINESS  
DESCRIPTION OF BUSINESS
NOTE 1. DESCRIPTION OF BUSINESS
 
DOMARK INTERNATIONAL, INC. ("Domark" or the "Company") was incorporated under
the laws of the State of Nevada on March 30, 2006. In 2008, the Company embarked
on a business plan that was intended to acquire profitable businesses that would
create shareholder value in diverse industries. During 2008 and 2009, the
Company acquired several operating businesses, as set forth in various Current
Reports on Form 8-K filed with the Securities and Exchange Commission. On May
21, 2009, the Company closed an acquisition pursuant to an Agreement for the
Exchange of Common Stock (the "Victory Lane Agreement") with Victory Lane
Financial Elite, LLC ("Victory Lane") with respect to a real estate lifestyle
business known as "Victory Lane" (the "Victory Lane Business"). Shortly
thereafter, a dispute arose between the Company and the principals of Victory
Lane regarding the representations of the principals of Victory Lane and the
Victory Lane Business and the Victory Lane Agreement. Litigation between the
Company and various parties pertaining to the Victory Lane Business remains
outstanding. (Refer to Notes 7 - Contingencies & Item II, Other Information
below).
 
HISTORY AND GENERAL OVERVIEW
 
On February 29, 2012, the Company formed a new wholly owned subsidiary,
Solawerks Inc. in the state of Nevada, for the purposes of entering the business
of marketing specialized solar consumer electronics. Solawerks' current focus is
to develop and distribute the SolaPad: a combined cover and charging system for
Apple's iPad, and the SolaCase: a combined cover and charging system for all
versions of Apple's iPhone. Solawerks competes in a market that also includes 3D
Systems (DDD), Dell (DELL) and Hewlett Packard (HPQ).
 
During the last half of 2009, the Company sold two of its operating
subsidiaries, Javaco, Inc. and ECFO Corporation and effected rescissions of
acquisition transactions on the remainder of its operating businesses. Between
October 2009 and May 2011, the Company had no material ongoing operations. The
business of the Company during the period from October 2009 through May 2011 was
to seek out new acquisitions and to conduct the litigation with Victory Lane.
 
On March 5, 2012, the Company entered into an Asset Purchase Agreement with its
then controlling shareholder, R. Thomas Kidd, for the sale of Armada, and
certain assets related thereto.
 
On May 26, 2012, the Company hired a new Chairman and President Brent Strasler.
He then hired a new Chief Executive Officer Andrew Ritchie on 12 June 2012. The
Company then strengthened the executive team by adding Patrick Johnson as VP -
business development.
 
On May 31, 2011, the Company formed a wholly owned subsidiary, Armada Sports &
Entertainment, Inc. Armada is a sports marketing and Management Company engaged
in owning, developing, and conducting made-for-television sports and
entertainment events. On March 5, 2012, the Company entered into an Asset
Purchase Agreement with its then controlling shareholder, R. Thomas Kidd, for
the sale of Armada, and certain assets related thereto.
 
In June 2012, the Company entered into a retail sales strategy with North
American retail specialist Chic and Savvy. During the 1st quarter, they attended
many retail sales exhibitions throughout Canada.
 
On June 20, 2012, the Company formed a new wholly owned subsidiary, Musclefoot
Inc. in the state of Nevada for the purpose of distributing, marketing, and
acting as sales agent for the patented foot care system, Barefoot Science. This
entity is currently in default under the Nevada Secretary of State.
 
On July 20, 2012, the Company formed a new wholly owned subsidiary, Domark
Canada Inc. in the province of Ontario for the purpose of supporting the
corporate operations based in Toronto, Ontario Canada.
 
The Company then endorsed world champion triple jumper Will Claye, and US
Olympian Nick Simmons prior to the London 2012 Olympic Games. This was part of a
strategy to obtain global exposure and align brands with world class sports
professionals. We then sponsored several UFC championship contenders.
 
As a result of the change in the Company's business model, the disclosures and
financial results contained herein should be reviewed as they relate to the
Company's historical operations but should be discounted as they relate to the
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XML 19 R7.htm IDEA: XBRL DOCUMENT v2.4.0.6
GOING CONCERN
3 Months Ended
Aug. 31, 2012
GOING CONCERN  
GOING CONCERN
NOTE 2. GOING CONCERN
 
The accompanying financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America which
contemplate continuation of the Company as a going concern. The Company has
consolidated losses from operations of ($1,186,799) for the 3 months ending
August 31, 2012 compared to a loss of ($137,589) for the same period ending
August 31, 2011. Furthermore, the Company has inadequate working capital to
maintain or develop its operations, and is dependent upon funds from private
investors and the financial support of certain stockholders.
 
These factors raise substantial doubt about the ability of the Company to
continue as a going concern. These 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 result from
this uncertainty. In this regard, management is planning to raise any necessary
additional funds through loans and additional sales of its common stock. There
is no assurance that the Company will be successful in raising additional
capital.
XML 20 R3.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONSOLIDATED BALANCE SHEETS PARENTHETICALS (USD $)
Aug. 31, 2012
May 31, 2012
Convertible preferred stock series A, par value $ 0.001 $ 0.001
Convertible preferred stock series A, shares authorized 2,000,000 2,000,000
Convertible preferred stock series A, shares issued 50,000 50,000
Convertible preferred stock series B, par value $ 0.001 $ 0.001
Convertible preferred stock series B, shares authorized 10,000,000 10,000,000
Common Stock, par value $ 0.001 $ 0.001
Common Stock, shares authorized 2,000,000 2,000,000
Common Stock, shares issued 29,540,298 29,005,298
Common Stock, shares outstanding 29,540,298 29,005,298
XML 21 R17.htm IDEA: XBRL DOCUMENT v2.4.0.6
RELATED PARTY TRANSACTIONS CONSISTS OF THE FOLLOWING (Details) (USD $)
May 25, 2012
Employment agreement with newly appointed President entitled to an annual salary $ 150,000
Stock purchase warrants exercisable 100,000
Common shares per share $ 1.00
Life insurance in the face amount payable to the beneficiary designated by Mr. Strasler 2,500,000
Indebted to Michael Franklin in the amount $ 1,000
XML 22 R1.htm IDEA: XBRL DOCUMENT v2.4.0.6
Document and Entity Information
3 Months Ended
Aug. 31, 2012
Document and Entity Information  
Entity Registrant Name Domark International Inc.
Document Type 10-Q
Document Period End Date Aug. 31, 2012
Amendment Flag false
Entity Central Index Key 0001365160
Current Fiscal Year End Date --05-31
Entity Common Stock, Shares Outstanding 29,540,298
Entity Filer Category Smaller Reporting Company
Entity Current Reporting Status Yes
Entity Voluntary Filers No
Entity Well-known Seasoned Issuer No
Document Fiscal Year Focus 2013
Document Fiscal Period Focus Q1
XML 23 R18.htm IDEA: XBRL DOCUMENT v2.4.0.6
EQUITY TRANSACTIONS CONSISTS OF THE FOLLOWING (Details) (USD $)
Aug. 31, 2012
Jul. 25, 2012
Jul. 19, 2012
Jul. 11, 2012
Jun. 26, 2012
Jun. 21, 2012
Jun. 18, 2012
May 25, 2012
R Brentwood Strasler was appointed with an annual compensation               $ 150,000
Andrew Ritchie was appointed with an annual Compensation             240,000  
Patrick Johnson was appointed with an annual compensation         84,000      
Annual compensation of share options         100,000   250,000 150,000
Share options per share         $ 1.00   $ 1.00 $ 1.00
Options were valued at         116,946      
RBL were awarded a contract         1,000      
Granted free trading shares         20,000      
Free trading shares valued         23,400      
Issued Preferred B shares           2,500,000    
Shares valued at           6,000,000    
Expensed over the term of the agreement 394,520              
Ian Nuttall received an additional shares       425,000        
common `A' stock in Domark International valued at       $ 382,500        
Nick Symmonds to endorse Domark products for compensation     100,000          
Will Claye to endorse Domark products for compensation   50,000            
Common A stock in Domark International Inc. valued at   34,000 68,000          
Shares of common stock outstanding 29,540,298              
Shares of Preferred Series A outstanding 50,000              
Shares of Preferred Series B outstanding 2,500,000              
XML 24 R4.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $)
3 Months Ended 34 Months Ended
Aug. 31, 2012
Aug. 31, 2011
Aug. 31, 2012
REVENUE $ 20,345 $ 0 $ 40,274
Cost of sales 22,976 0 71,485
Gross Profit (2,631) 0 (31,211)
General and administrative expenses 788,647 137,589 6,600,606
Research and development 0 0 45,607
Bad debt expense 1,000 0 101,000
Impairment of asset 0 0 10,000
Impairment of goodwill 0 0 10,000
Forgiveness of debt 0 0 4,000
License Fees 394,520 0 394,520
Operating Loss (1,186,799) (137,589) (7,188,945)
Other Income 0 0 29,567
Net Loss $ (1,186,799) $ (137,589) $ (7,159,378)
Net loss per share, basic and diluted $ (0.04) $ 0.00 $ (0.25)
Weighted average common shares outstanding 29,350,896 36,953,743 29,035,724
XML 25 R12.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONTINGENCIES
3 Months Ended
Aug. 31, 2012
CONTINGENCIES  
CONTINGENCIES
NOTE 7. CONTINGENCIES
 
*    On May 21, 2009, the Company entered into that certain Agreement for the
     Exchange of Common Stock (the "Victory Lane Agreement") with Victory Lane
     Financial Elite, LLC ("Victory Lane") with respect to a real estate
     lifestyle business known as Victory Lane (the "Victory Lane Business")
     pursuant to which the Company intended to purchase the Victory Lane
     Business. Shortly thereafter, a dispute arose between the Company and
     Victory Lane regarding alleged mis-representations made by Victory Lane in
     connection with the Victory Lane Agreement.
 
*    In August, 2009, Victory Lane Financial Elite, LLC, Legacy Development, LLC
     and Patrick Costello filed suit in the Superior Court of Tattnall County,
     Georgia (Civ. No. 2009-V-381-JW) against the Company, R. Thomas Kidd and
     various officers and directors of the Company, alleging that the Company
     was in breach of the Victory Lane Agreement and that the Company and
     certain of the individual defendants had committed various torts against
     the plaintiffs and that certain of the individual defendants had violated
     various fiduciary and other duties owed to the plaintiffs in connection
     with the Victory Lane Agreement and the handling of the Victory Lane
     Business (the "VLFE Case"). The plaintiffs sought a declaratory judgment to
     the effect that the Victory Lane Agreement had not been executed, as well
     as money damages from the Company and the individual defendants. The
     Company and Mr. Kidd have answered the Complaint, denying any liability for
     the plaintiff's claims and have asserted various counterclaims including
     fraud and other torts. In July 2010 the court dismissed all of the
     individual defendants, other than R. Thomas Kidd, in response to a motion
     to dismiss for lack of jurisdiction. The case has since been stayed.
 
*    In December, 2009, AHIFO-21, LLC filed a lawsuit in the Superior Court of
     Tattnall County, Georgia (Civ. No. 2009-V-672-JS) against Victory Lane,
     LLC, Patrick J. Costello and Stephen Brown (the "Victory Lane Defendants")
     alleging that the Victory Lane Defendants owe the plaintiff more than
     $7,740,000 in respect of one or more loans made by the plaintiff to certain
     of the Victory Lane Defendants in connection with the Victory Lane Business
     (the "AHIFO Case"). In February, 2010, the Victory Lane Defendants filed a
     Third Party Complaint against the Company and R. Thomas Kidd, claiming that
     the Company and Mr. Kidd should be liable for any amounts the Victor Lane
     Defendants are required to pay to the plaintiff in this case. The Company
     and Mr. Kidd have answered the Complaint, denying any liability for the
     plaintiff's claims and have asserted various counterclaims including fraud
     and other torts. The Company and Mr. Kidd filed a motion to dismiss the
     Third Party Complaint, but the entire case was subsequently stayed.
 
*    Because each of the VLFE Case and the AHIFO Case have been stayed and
     because discovery in those cases is not complete, the Company has not
     reached a determination that any loss is other than remote and that the
     amount of any damages, if any were determined adverse to the Company, would
 
     be reasonably estimable. The Company believes that it has meritorious
     claims against the opposing parties with respect to the Victory Lane
     Agreement and that the claims asserted against it are not meritorious. The
     Company intends to defend itself vigorously.
XML 26 R11.htm IDEA: XBRL DOCUMENT v2.4.0.6
SHAREHOLDERS EQUITY
3 Months Ended
Aug. 31, 2012
SHAREHOLDERS EQUITY  
SHAREHOLDERS EQUITY
NOTE 6. SHAREHOLDERS' EQUITY
 
*    On May 25, 2012, - R Brentwood Strasler was appointed as Chairman and
     President / Director, with an annual compensation of $150,000 and 150,000
     share options at $1.00 which will vest in one year on a quarterly basis.
     The Company valued the options using the Black-Scholes valuation model. As
     of the grant date the options were valued at $175,419.
 
DoMark International Inc. Announces Appointment of New President
 
*    On Jun 18, 2012, - Andrew Ritchie was appointed as Chief Executive Officer/
     Director with an annual Compensation of $240,000 and 250,000 share options
     at $1.00 which will vest in one year on a quarterly basis. The Company
     valued the options using the Black-Scholes valuation model. As of the grant
     date the options were valued at $175,414.
 
DoMark International Inc. Announces Appointment of New Chief Executive Officer
 
*    On Jun 21, 2012, - Domark signed a contract with Barefoot-Science to become
     exclusive marketing direct sales distributor for North America. Barefoot -
     Science will be issued 2,500,000 shares of Preferred B shares of Domark
     International Inc. which are convertible at any time at request of holder
     into common A shares at a 1 Preferred Series B into 2 Common shares ratio.
     Shares will hold a six month restriction under 144 rules. The shares have
     been valued at $6,000,000 USD which will be expensed over the term of the
     agreement (3 years). As of August 31, 2012, $394,520 USD has been expensed.
 
DoMark International, Inc. Enters Into Multi-Billion Dollar Footwear and Foot
Care Markets with Industry Changing Technology From Barefoot Sciences Inc.
 
*    On Jun 26, 2012, - Patrick Johnson was appointed as Vice President of
     Business Development, with an annual compensation of $84,000 and 100,000
     share options at $1.00 which will vest in one year on a quarterly basis.
     The Company valued the options using the Black-Scholes valuation model. As
     of the grant date the options were valued at $116,946.
 
DoMark International Inc. Announces Appointment of All-Star Athlete and Super
Bowl Champion as VP - Corporate Development
 
*    On Jun 26, 2012,- RBL were appointed to look after all Domarks Social media
     campaigns. They were awarded a contract of $1,000 a month and were granted
     20,000 free trading shares in Domark international valued at $23,400.
 
DoMark International Inc. Announces Appointments RBL Communications as social
media agent.
 
*    On July 11, 2012 - Ian Nuttall received an additional 425,000 shares as a
     consultant to Domark of Rule 144 common `A' stock in Domark International
     Inc. valued at $382,500.
 
On Jul 19, 2012, - Domark signs Nick Symmonds to endorse Domark products for
compensation of 100,000 shares of rule144 common A stock in Domark International
Inc. valued at $68,000.
 
DoMark Signs Five-Time American 800 m Champion Nick Symmonds to Endorsement Deal
 
*    On Jul 25, 2012, - Domark signs Will Claye to endorse Domark products for
     compensation of 50,000 shares of rule144 common A stock in Domark
     International Inc.valued at $34,000.
 
*    Strasler. The warrants awarded will be valued in accordance with ASC
     718-10-30-9, Measurement Objective - Fair Value at Grant Date. The Company
     estimates fair value of the award using the Black-Scholes option pricing
     model. Since the effective date of the grant is June 1, 2012, the Company
     did not realize or record an estimated fair value of the warrants and
     therefore there is no impact to the financial statements for the fiscal
     period ending May 31, 2012.
 
     Our common stock is traded in the over-the-counter market, and quoted in
     the National Association of Securities Dealers Inter-dealer Quotation
     System ("Electronic Bulletin Board) and can be accessed on the Internet at
     www.otcbb.com under the symbol "DOMK.OB".
 
     As of August 31, 2012, there were 29,540,298 shares of our common stock
     outstanding and 50,000 shares of Preferred Series A (1000:1 conversion)and
     2,500,000 shares of Preferred Series B (2:1 conversion). There were
     approximately 84 shareholders of record of the Company's common stock.
XML 27 R19.htm IDEA: XBRL DOCUMENT v2.4.0.6
COMMITMENTS CONSISTS OF THE FOLLOWING (Details) (USD $)
Jul. 28, 2012
Jul. 16, 2012
Sports physio was appointed with a signing agreement   $ 10,000
Machine cost 19,495  
Rental agreement per month $ 895  
XML 28 R15.htm IDEA: XBRL DOCUMENT v2.4.0.6
ACCOUNTING POLICIES (Policies)
3 Months Ended
Aug. 31, 2012
ACCOUNTING POLICIES  
DEVELOPMENT STAGE COMPANY DEVELOPMENT STAGE COMPANY The Company is a development stage company as defined in ASC Standard 915-10-05 and has recognized no revenue and devotes substantially all of its efforts on establishing its online retail and product development business. Its planned principal operations in advancing its online product development business have commenced. All losses accumulated since inception have been considered a part of the Company's development stage activities.
USE OF ESTIMATES
USE OF ESTIMATES
 
The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements. These estimates and assumptions also
affect the reported amounts of revenues, costs and expenses during the reporting
period. Management evaluates these estimates and assumptions on a regular basis.
Actual results could differ from those estimates.
 
The primary management estimates included in these financial statements is the
licensing fees, stock option valuation and the fair value of its stock tendered
in various non-monetary transactions.
CASH AND CASH EQUIVALENTS POLICY
CASH AND CASH EQUIVALENTS
 
The Company considers all highly liquid investments with an original maturity of
three months or less to be cash equivalents. At August 31, 2012, cash and cash
equivalents included cash on hand and cash in the bank.
INVENTORIES POLICY
INVENTORIES
 
Inventories consist of retail products which are stated at the lower of cost or
market. Cost is determined by the specific identification method.
FAIR VALUE OF FINANCIAL INSTRUMENTS
FAIR VALUE OF FINANCIAL INSTRUMENTS
 
The carrying amounts reflected in the consolidated balance sheets for cash,
accounts payable, and accrued expenses approximate the respective fair values
due to the short maturities of these items.
PRINCIPLES OF CONSOLIDATION
PRINCIPLES OF CONSOLIDATION
 
The accompanying financial statements represent the consolidated financial
position and results of operations of the Company and include the accounts and
results of operations of the Company and its subsidiaries. The accompanying
financial statements include the active entity of Domark International, Inc. and
its wholly owned subsidiaries, Musclefoot Inc., Solawerks Inc and Domark Canada
Inc. The Company has relied upon the guidance provided by Statements of
Financial Accounting Standards, ASC 810-10-15-3.
STOCK BASED COMPENSATION POLICY
STOCK-BASED COMPENSATION
 
The Company accounts for share based payments in accordance with ASC 718,
Compensation - Stock Compensation, which requires all share-based payments to
employees, including grants of employee stock options, to be recognized in the
financial statements based on the grant date fair value of the award. In
accordance with ASC 718-10-30-9, Measurement Objective - Fair Value at Grant
Date, the Company estimates fair value of the award using a valuation technique.
For this purpose, the Company uses the Black-Scholes option pricing model. The
Company believes the model provides the best estimate of fair value due to its
ability to incorporate inputs that change over time, such as volatility and
interest rates, and to allow for actual exercise behavior of option holders.
Compensation cost is recognized over the requisite service period which is
generally equal to the vesting period. Upon exercise, shares issued will be
newly issued shares from authorized common stock.
 
ASC 505, "Compensation-Stock Compensation", establishes standards for the
accounting for transactions in which an entity exchanges its equity instruments
to non-employees for goods or services. Under this transition method, stock
compensation expenses includes compensation expense for all stock-based
compensation awards granted on or after January 1, 2006, based on the grant-date
fair value estimated in accordance with provisions of ASC 505.
NET LOSS PER COMMON SHARE
NET LOSS PER COMMON SHARE
 
The Company computes net loss per share in accordance with the Earning per Share
Topic of the FASB ASC 260. Under the provisions of ASC, basic net loss per share
is computed by dividing the net loss available to common stockholders for the
period by the weighted average number of shares of common stock outstanding
during the period. The calculation of diluted net loss per share gives effect to
common stock equivalents; however, potential common shares are excluded if their
effect is anti-dilutive. As of August 31, 2012, options and warrants were
outstanding and have been valued using Black-Scholes.
RESEARCH AND DEVELOPMENT
RESEARCH AND DEVELOPMENT
 
All research and development expenditures are expensed as incurred. There was no
R&D cost incurred during the Quarter.
REVENUE RECOGNITION
REVENUE RECOGNITION
 
The Company recognizes revenues when persuasive evidence of an arrangement
exists, delivery has occurred or services have been rendered, the price is fixed
or determinable, and collection of the resulting receivable is reasonably
assured. Inventory is capitalized and costs of sales are recognized during the
period in which they are sales occurred. The Company derived its revenues for
the period through internet sales of our solar charging units. The Company
recognized these sales once delivery is made from the warehouse (FOB shipping
point).
XML 29 R13.htm IDEA: XBRL DOCUMENT v2.4.0.6
COMMITMENTS
3 Months Ended
Aug. 31, 2012
COMMITMENTS  
COMMITMENTS
NOTE 8. COMMITMENTS
 
*    On Jul 16, 2012, - Leading specialist Sports physio was appointed to
     Domarks advisory committee with a signing agreement of $10,000. DoMark
     International Inc. Appoints Sean Pena to Advisory Committee
 
*    On Jun 28, 2012, - Domark donates a Noraxon foot Scanner to Sean Penna to
     assist in the training of the U.S Olympic team. The machine cost $19,495,
     and is being purchased through a rental buy agreement of $895 a month.
 
     Donates Performance Enhancing Technology by Noraxon to Assist Physio Expert
     to World's Top Track Athletes in Preparation for the 2012 Olympic Games
XML 30 R14.htm IDEA: XBRL DOCUMENT v2.4.0.6
LIABILITIES AND NOTES PAYABLE
3 Months Ended
Aug. 31, 2012
LIABILITIES AND NOTES PAYABLE  
LIABILITIES AND NOTES PAYABLE
NOTE 9. LIABILITIES & NOTES PAYABLE
 
On February 29, 2012, Company entered into a Promissory Note with R. Thomas
Kidd, our then Chief Executive Officer of the Company, and Infinite Funding,
Inc. ("IFI"). This Note replaces four promissory notes issued by IFI to the
Company as more fully described below.
 
Effective March 3, 2011, we obtained an unsecured loan in the amount of $75,000
from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note from the
Company to Infinite Funding, Inc. dated March 3, 2011 (the "IFI Note"). The Note
was amended three times to extend the due date and was first amended on June 9,
2011, a second time on September 28, 2011, and a third amendment on December 9,
2011. Pursuant to the amendments, the Company agreed to pay extension fees of
$30,000, thereby increasing the principle balance of this Note to $105,000.
 
Effective June 10, 2011, we obtained an unsecured loan in the amount of $75,000
from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note from the
Company to Infinite Funding, Inc. dated June 10, 2011 (the "IFI Note"). The Note
was amended two times to extend the due date and was first amended on September
28, 2011 and again on December 9, 2011. Pursuant to the amendments, the Company
agreed to pay extension fees of $20,000, thereby increasing the principle
balance of this Note to $95,000.
 
Effective September 28, 2011, we obtained an unsecured loan in the amount of
$40,000 from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note
from the Company to Infinite Funding, Inc. dated September 28, 2011 (the "IFI
Note"). The Note was amended to extend the due date on December 9, 2011.
Pursuant to this amendment, the Company agreed to pay an extension fee of
$10,000, thereby increasing the principle balance of this Note to $50,000.
 
Effective December 9, 2011, we obtained an unsecured loan in the amount of
$100,000 from Infinite Funding, Inc. ("IFI") as evidenced by a Promissory Note
from the Company to Infinite Funding, Inc. dated December 9, 2011 (the "IFI
Note").
 
As a result of consolidating the aforementioned debt, the Company is now
obligated under a single Promissory Note dated February 29, 2012 in the
aggregate principle amount of $355,645 along with $2,689 in accrued interest.
The Note is due on October 15, 2012 and accrues interest at 3% per annum. In
addition, R Thomas Kidd executed a Personal Guarantee of the Note, whereby Kidd
guarantees the payment of $100,000 of the principle balance in an Event of
Default pursuant to Article III of the Note.
 
MASTER CREDIT AGREEMENTS
 
On March 2, 2012, the Company entered into a Master Credit Agreement with
Infinite Funding, Inc. which provides for a non-revolving line of credit. The
Company may request advances under the lending facility by issuing borrowing
certificates to the Lender. Each borrowing certificate, together with simple
interest accrued at 8% per year, becomes payable one year after the date of the
advance received. Infinite Funding has amended the Master Credit Agreement,
increasing the amount of the Lending Facility from $150,000 to $200,000. As of
May 31, 2012, the Company received $190,000 in advances and the Company has
accrued $1,375 in interest. 
 
As of August 31, 2012, the company has received additional loans in the amounts
of $49,470 USD and $104,252 USD.
XML 31 R16.htm IDEA: XBRL DOCUMENT v2.4.0.6
GOING CONCERN AND LOSS (Details) (USD $)
3 Months Ended
Aug. 31, 2012
Aug. 31, 2011
Consolidated losses from operations $ (1,186,799) $ (137,589)
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MASTER CREDIT AGREEMENT CONSISTS OF THE FOLLOWING (Details) (USD $)
Aug. 31, 2012
May 31, 2012
Mar. 02, 2012
Simple interest accrued per year     8.00%
Increasing the amount of the Lending Facility from     $ 200,000
Received advances   190,000  
Accrued in interest amount   1,375  
Receivedadditional loans in the amounts 49,470    
Received additional loans in amount $ 104,252    
XML 34 R5.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)
3 Months Ended 34 Months Ended
Aug. 31, 2012
Aug. 31, 2011
Aug. 31, 2012
CASH FLOWS FROM OPERATING ACTIVITIES      
Net loss $ (1,186,799) $ (137,589) $ (7,159,378)
Adjustments to reconcile net loss to net cash used in operating activities:      
Depreciation and amortization 2,619 1,968 13,458
Amortized finance cost 14,799 0 50,000
Non cash interest 0 0 5,645
Impairment of assets 0 0 10,000
Bad debt expense 0 0 1,000
Common stock issued as compensation and for expenses 920,175 28,153 5,544,485
Gain on sale of assets 0 0 0
Forgiveness of debt 0 0 (4,000)
Changes in operating assets and liabilities:      
Decrease prepaid exp and other current assets 11,020 0 11,020
Increase inventory (13,611) 0 (30,537)
Decrease in deferred financing costs 0 (3,516) (3,516)
Increase in accounts payable 49,416 26,000 288,351
Increase in accounts payable-related party 25,442 0 40,808
Increase in accrued expenses 0 14,426 0
NET CASH USED IN OPERATING ACTIVITIES (176,939) (70,558) (1,230,149)
CASH FLOWS FROM INVESTING ACTIVITIES      
Cash paid for licensing 0 0 (35,000)
Cash paid for web development 0 (4,000) (7,500)
Cash paid for furniture and equipment 0 0 (4,000)
NET CASH FLOWS USED IN INVESTING ACTIVITIES 0 (4,000) (46,500)
CASH FLOWS FROM FINANCING ACTIVITIES      
Proceeds received from shareholder loans 153,722 5,000 1,048,122
Payment on shareholder loans 0 (19,273) (125,478)
Proceeds received from notes payable 0 0 480,000
Payments made on notes payable 0 0 (100,470)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 153,722 70,727 1,302,174
Net increase (decrease) in cash and cash equivalents (23,217) (3,831) 25,525
Cash and cash equivalents - beginning of period 52,269 4,587 3,527
CASH AND CASH EQUIVALENTS BALANCE END OF PERIOD 29,052 756 29,052
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:      
Prepaid license fees 6,000,000 0 6,000,000
Prepaid expenses 0 0 (397,675)
Inventory 0 0 (16,926)
Fixed assets, net of depreciation 0 0 (3,868)
Website costs, net of amortization 0 0 (1,167)
License, net of amortization 0 0 (24,432)
Accounts payable 0 0 19,257
Payroll & related liabilities 0 0 249,631
Due to affiliates and shareholder 0 0 929,738
Return of preferred shares, par value 0 0 50
Return of common stock, par value 0 0 9,772
Additional capital contributed in excess of net assets sold $ 0 $ 0 $ (764,380)
XML 35 R10.htm IDEA: XBRL DOCUMENT v2.4.0.6
RELATED PARTY TRANSACTIONS
3 Months Ended
Aug. 31, 2012
RELATED PARTY TRANSACTIONS  
RELATED PARTY TRANSACTIONS
NOTE 5. RELATED PARTY TRANSACTIONS
 
On February 29, 2012 the Company executed a Memorandum of Agreement with Xiamen
Tiauyang Neng Gongsi and Michael Franklin related to the acquisition of certain
exclusive worldwide licensing and joint patent rights.
 
On May 25, 2012, the Company entered into an employment agreement with an
effective date of June 1, 2012 with its newly appointed President, R. Brentwood
Strasler, for a period of no less than three years. Mr. Strasler is entitled to
an annual salary of $150,000 and 100,000 stock purchase warrants exercisable to
purchase common shares of the Company at $1.00 per share. The warrants are
exercisable for a three year period and can be vested quarterly on a pro rata
basis over twelve months from the date of issue. Additionally, Mr. Strasler will
be enrolled in a long term Executive Option Plan no later than three months
after the effective date of the employment agreement and is entitled to term
life insurance in the face amount of $2,500,000, payable to the beneficiary
designated by Mr. Strasler. The warrants awarded will be valued in accordance
with ASC 718-10-30-9, Measurement Objective - Fair Value at Grant Date. The
Company estimates fair value of the award using the Black-Scholes option pricing
model.
 
The Company is indebted to Michael Franklin, previously President of our wholly
owned subsidiary Solawerks, Inc., in the amount of $1,000 for monies advanced to
the Company to initiate the initial opening of the Sun Trust bank account. This
loan is non-interest bearing and payable upon demand.
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LIABILITIES AND NOTES PAYABLE CONSISTS OF THE FOLLOWING (Details) (USD $)
Oct. 15, 2012
Feb. 29, 2012
Dec. 09, 2011
Sep. 28, 2011
Jun. 10, 2011
Mar. 03, 2011
Obtained an unsecured loan     $ 100,000 $ 40,000 $ 75,000 $ 75,000
Agreed to pay extension fees       10,000 20,000 30,000
Increasing in principle balance of note       50,000 95,000 105,000
Consolidated debt under a single Promissory Note   355,645        
Accrued interest on principle amount   $ 2,689        
Note is due on October 15, 2012 and accrues interest rate per annum 3.00%