10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q/A

Amendment No. 1

(Mark One)

S QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2011

£ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission File Number:  333-148722

MAX CASH MEDIA, INC.

(Exact name of registrant as specified in its charter)

Nevada	02-0811868
(State or other jurisdiction of incorporation)	(I.R.S. Employer Identification No.)

50 Brompton Road, Apt. 1X

Great Neck, NY  11021

(Address of principal executive offices)

(646) 303-6840

(Registrant’s telephone number, including area code)

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 (§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. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer £	Accelerated filer £	Non-accelerated filer £	Smaller reporting company x
		(Do not check if a smaller Reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ¨ No x

There were 6,370,000 shares of the registrant’s common stock, $0.001 par value per share, outstanding as of February 21, 2012.

EXPLANATORY NOTE

This Amendment No. 1 to Max Cash Media, Inc.’s (the Company”) Quarterly Report on Form 10-Q for the period ended December 31, 2011 (“Form 10-Q”), as filed with the Securities and Exchange Commission on February 21, 2012, is being filed solely to furnish Exhibit 101 to the Form 10-Q as required by Rule 405 of Regulation S-T.  Exhibit 101 to this Amendment No. 1 to Form 10-Q furnishes the following items in eXtensible Business Reporting Language: (i) the Company’s condensed balance sheets as of December 31, 2011 (unaudited) and September 30, 2011, (ii) the Company’s unaudited condensed statements of operations for the three months ended December 31, 2011 and 2010, (iii) the Company’s unaudited statement in changes in stockholders’ equity (deficiency) for the period from July 9, 2007 (inception) to December 31, 2011, (iv) the Company’s unaudited condensed statements of cash flows for the three months ended December 31, 2011 and 2010, and (v) the notes to the Company’s consolidated financial statements (unaudited).

No changes have been made to the Form 10-Q other than the furnishing of Exhibit 101 described above. This Amendment No. 1 to Form 10-Q does not reflect subsequent events occurring after the original filing date of the Form 10-Q or modify or update in any way disclosures made in the Form 10-Q.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	MAX CASH MEDIA, INC.
February 22, 2012	By:	/s/ Noah Levinson
		Noah Levinson, Chief Executive Officer and Chief Financial Officer

EXHIIBIT INDEX

* 31.1 Certification of Principal Executive Officer and Financial Officer pursuant to Section 302 of the Sarbanes Oxley Act of 2002

* 32.1 Certification of Chief Executive Officer and Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

** 101.INS  XBRL Instance Document

** 101.SCH XBRL Taxonomy Extension Schema Document

** 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document

** 101.DEF XBRL Taxonomy Extension Definition Linkbase Document.

** 101.LAB XBRL Taxonomy Extension Label Linkbase Document

*

Previously filed.

**

Furnished herewith. Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of any registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, and otherwise are not subject to liability under those sections.

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NOTE RECEIVABLE

3 Months Ended

Dec. 31, 2011

NOTE RECEIVABLE

NOTE 2 NOTE RECEIVABLE

On August 4, 2011, the Company received a promissory note in exchange for $2,000,000 bearing interest at 8% with Prism Corporation (the Borrower). The loan was disbursed in four installments:

· August 9, 2011 - $1,000,000, due by November 9, 2011

· August 18, 2011 - $500,000, due by November 18, 2011

· August 31, 2011 - $250,000, due by November 30, 2011

· September 9, 2011 - $250,000, due by December 9, 2011

The loan was due and payable on the earliest of:

· On the dates mentioned above, or

· Closing of additional financing by the borrower of an amount equal to or greater of the amount loaned, or

· The date of closing of the merger between the borrower and the lender.

As part of the note receivable the borrower entered into a security and a pledge agreements with the Company. The security agreement is dated August 5, 2011 and Pledge Agreement is dated August 4, 2011. The Security Agreement granted the Company first priority security interest in all tangible and intangible assets of the borrower. The Pledge Agreement pledged 1,000 issued and outstanding shares of common stock of the borrower as security

As of December 31, 2011, none of the above events took place.   No repayment of the note occurred through today and the note receivable is in default. The Company is not recognizing the interest income on the note receivable since the note is in default.  Currently, the value of pledged capital stock cannot be determined and the entire $2,000,000 is deemed to be uncollectible and was fully reserved in the prior year. On January 9, 2012 the Company commenced litigation against the borrower to secure the Company’s interest in the pledged assets (See Note 10).

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

3 Months Ended

Dec. 31, 2011

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

(A) Basis of Presentation

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in The United States of America and the rules and regulations of the Securities and Exchange Commission for interim financial information. Accordingly, they do not include all the information necessary for a comprehensive presentation of financial position and results of operations.

It is management's opinion, however that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statements presentation. The results for the interim period are not necessarily indicative of the results to be expected for the year.

Max Cash Media, Inc. (a development stage company) (the "Company") was incorporated under the laws of the State of Nevada on July 9, 2007. Activities during the development stage include developing the business plan and raising capital.

(B) Use of Estimates

In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period. Significant estimates include the allowance for doubtful accounts, the amortization of debt issuance costs and valuation of deffered tax assets. Actual results could differ from those estimates.

(C) Cash and Cash Equivalents

The Company considers all highly liquid temporary cash investments with an original maturity of three months or less to be cash equivalents. At December 31, 2011 and September 30, 2010, the Company had no cash equivalents.

(D) Loss Per Share

Basic and diluted net loss per common share is computed based upon the weighted average common shares outstanding as defined by FASB Accounting Standards Codification Topic 260, “Earnings Per Share.” As of December 31, 2011 and 2010 there were no common share equivalents outstanding.

(E) Income Taxes

The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”). Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740-10-25, the effect on deferred tax assets and liabilities from a change in tax rates is recognized in income in the period that includes the enactment date.

The Company’s federal income tax returns for the years September 30, 2007 through December 31, 2011 remain subject to examination by the Internal Revenue Service as of December 31, 2011.

(F) Business Segments

The Company operates in one segment and therefore segment information is not presented.

(G) Revenue Recognition

The Company will recognize revenue on arrangements in accordance with FASB ASC No. 605, “Revenue Recognition”. In all cases, revenue is recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.

(H) Reclassification

Certain amounts from prior period have been reclassified to conform to the current period presentation.

(I) Fair Value of Financial Instruments

The carrying amounts reported in the balance sheet for accounts payable, accrued expenses, convertible note payable and note payable approximate fair value based on the short-term maturity of these instruments.

(J) Recent Accounting Pronouncements

ASU No. 2011-03; Reconsideration of Effective Control for Repurchase Agreements. In April, 2011, the FASB issued ASU No. 2011-03. The amendments in this ASU remove from the assessment of effective control the criterion relating to the transferor’s ability to repurchase or redeem financial assets on substantially the agreed terms, even in the event of default by the transferee. The amendments in this ASU also eliminate the requirement to demonstrate that the transferor possesses adequate collateral to fund substantially all the cost of purchasing replacement financial assets.

The guidance in this ASU is effective for the first interim or annual period beginning on or after December 15, 2011. The guidance should be applied prospectively to transactions or modifications of existing transactions that occur on or after the effective date. Early adoption is not permitted. The Company will adopt the methodologies prescribed by this ASU by the date required, and does not anticipate that the ASU will have a material effect on its financial position or results of operations.

ASU No. 2011-04; Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs. In May, 2011, the FASB issued ASU No. 2011-04. The amendments in this ASU generally represent clarifications of Topic 820, but also include some instances where a particular principle or requirement for measuring fair value or disclosing information about fair value measurements has changed. This ASU results in common principles and requirements for measuring fair value and for disclosing information about fair value measurements in accordance with U.S. GAAP and IFRSs. The amendments in this ASU are to be applied prospectively. For public entities, the amendments are effective during interim and annual periods beginning after December 15, 2011. Early application by public entities is not permitted.

The Company will adopt the methodologies prescribed by this ASU by the date required, and does not anticipate that the ASU will have a material effect on its financial position or results of operations.

ASU No. 2011-05; Amendments to Topic 220, Comprehensive Income. In June, 2011, the FASB issued ASU No. 2011-05. Under the amendments in this ASU, an entity has the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In both choices, an entity is required to present each component of net income along with total net income, each component of other comprehensive income along with a total for other comprehensive income, and a total amount for comprehensive income. This ASU eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. The amendments in this ASU do not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income.

The amendments in this ASU should be applied retrospectively. For public entities, the amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011. Early adoption is permitted, because compliance with the amendments is already permitted. The amendments do not require any transition disclosures. Due to the recency of this pronouncement, the Company is evaluating its timing of adoption of ASU 2011-05, but will adopt the ASU retrospectively by the due date.

On September 15, 2011, the FASB issued ASU 2011-08, Intangibles – Goodwill and Other, which simplifies how an entity is required to test goodwill for impairment. This ASU would allow an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. Under the ASU, an entity would not be required to calculate the fair value of a reporting unit unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. The ASU includes a number of factors to consider in conducting the qualitative assessment.  The ASU is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011.  Early adoption is permitted. This standard is not expected to have a material impact on the Company’s reported results of operations or financial position.

(K) Debt Issue Costs and Debt Discount

The Company may pay debt issue costs, and record debt discounts in connection with raising funds through the issuance of convertible debt.  These costs are amortized over the life of the debt to debt issue costs. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amounts is immediately expensed.

(L) Notes Receivable

Notes receivable is recorded at cost and net of allowances for losses when a note is deemed to be impaired. The Company does not record interest income on notes receivable when the contractual payment of interest and/or principal is not received.

(M) Impairment of Notes Receivable

We review notes receivables for impairment in each reporting period pursuant to the applicable authoritative accounting guidance. A note is impaired when, based on current information and events, it is probable that we will be unable to collect all amounts recorded as assets on the balance sheet. We apply normal loan review and underwriting procedures (as may be implemented or modified from time to time) in making that judgment.

When a note is impaired, we measure impairment based on the present value of expected cash flows discounted at the notes effective interest rate against the value of the asset recorded on the balance sheet. We may also measure impairment based on a notes observable market price or the fair value of collateral if the notes is collateral dependent. If a note is deemed to be impaired, we record a valuation allowance through a charge to earnings for any shortfall. Our assessment of impairment is based on considerable judgment and estimates.

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Consolidated Balance Sheets (USD $)	Dec. 31, 2011	Sep. 30, 2011
Current Assets
Cash	$ 24,711	$ 25,205
Total Current Assets	24,711	25,205
Other Assets
Debt Issue Costs, net	447	2,236
Total Other Assets	447	2,236
Total Assets	25,158	27,441
Current Liabilities
Accounts Payable and Accrued Expenes	79,938	34,893
Accrued Interest Payable	83,543	38,775
Convertible Note Payable	2,050,000	2,050,000
Current Liabilities	2,213,481	2,123,668
Long Term Liabilities
Convertible Note Payable	66,125	66,125
Note Payable	65,000	65,000
Total Liabilities	2,344,606	2,254,793
Commitments and Contingencies
Stockholders' Deficiency
Preferred stock, $0.001 par value; 10,000,000 shares authorized, none issued and outstanding
Common stock, $0.001 par value; 100,000,000 shares authorized, 6,370,000 and 6,370,000 shares issued and outstanding, respectively	6,370	6,370
Additional paid-in capital	152,273	151,623
Deficit accumulated during the development stage	(2,478,091)	(2,385,345)
Total Stockholder's Deficiency	(2,319,448)	(2,227,352)
Total Liabilities and Stockholders' Deficiency	$ 25,158	$ 27,441

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Condensed Statement of Changes in Stockholders' Equity (Deficiency) (Parenthetical) (USD $)	3 Months Ended	12 Months Ended
	Sep. 30, 2007	Sep. 30, 2008
Cash
Common stock issued, per share	$ 0.10	$ 0.10
Founder | Services
Common stock issued, per share	$ 0.001

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Condensed Statements of Cash Flows (USD $)	3 Months Ended		54 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2011
Cash Flows Used in Operating Activities:
Net loss	$ (92,746)	$ (22,333)	$ (2,478,091)
Adjustments to reconcile net loss to net cash used in operations
In-kind contribution of services	650	650	11,643
Shares issued to founder for services			5,000
Impairment of note receivable			2,000,000
Amortization of Debt Issue Costs	1,789		5,142
Changes in operating assets and liabilities:
Increase in accounts payable and accrued expenses	45,045	9,222	84,938
Increase in accrued interest payable	44,768	2,772	83,543
Net Cash Used In Operating Activities	(494)	(9,689)	(287,825)
Cash flows from investing Activities
Notes received in exchange for cash			(2,000,000)
Net cash used in Investing Activities			(2,000,000)
Cash Flows From Investing Activities:
Debt Issue Costs			(5,589)
Proceeds from note payable			65,000
Proceeds from loan payable			4,585
Repayment of loan payable			(4,585)
Proceeds from loan payable- Related party			1,100
Repayment of loan payable - Related party			(1,100)
Proceeds from convertible note payable			2,116,125
Proceeds from issuance of common stock			137,000
Net Cash Provided by Financing Activities			2,312,536
Net Increase/(Decrease) in Cash	(494)	(9,689)	24,711
Cash at Beginning of Period	25,205	11,410
Cash at End of Period	24,711	1,721	24,711
Supplemental disclosure of cash flow information:
Cash paid for interest
Cash paid for taxes			120
Supplemental disclosure of non-cash investing and financing activities:
Forgiveness of Related Accounts Payable			$ 5,000

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Consolidated Balance Sheets (Parenthetical) (USD $)	Dec. 31, 2011	Sep. 30, 2011
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, issued
Preferred stock, outstanding
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	6,370,000	6,370,000
Common stock, shares outstanding	6,370,000	6,370,000

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SUBSEQUENT EVENTS

3 Months Ended

Dec. 31, 2011

SUBSEQUENT EVENTS

NOTE 10 SUBSEQUENT EVENTS

On January 9, 2012, the Company commenced litigation in the Federal Court for the Southern District of New York (the “Court”) against Prism Corporation and its President Joe Loftis (the “Defendants”).  The Complaint states causes of action against the Defendants for breach of contract, seizure of collateral and injunctive relief, and seeks to obtain a Judgment in the amount of $2,000,000 plus interest and all costs due under the four promissory notes at issue.  In an effort to ensure that the Company’s first priority security interest in Prism's assets (the “Collateral” under the relevant security and pledge agreements) remains intact throughout the pendency of the litigation, the Company also successfully petitioned the Court to issue an Order to Show Cause with Temporary Restraining Order, thereby enjoining Defendants from, among other things, selling, assigning, transferring, conveying or otherwise disposing of any of the Collateral.  On January 20, 2012, the Court granted the Company’s motion for a preliminary injunction against the Defendants. The Company’s attorneys will continue to aggressively pursue all available remedies.

On February 1, 2012, the Company issued a convertible promissory note in the amount of $20,000. This promissory note matures on July 31, 2013, and both the principal and accrued interest will be mandatorily converted upon the closing of the next securities offering or other financing by the Company in which the Company raises a minimum of US one million dollars ($1,000,000), which offering closes concurrent with the closing of a related merger or other acquisition transaction (the “Financing”), at a price equal to either (a) the price per share of stock (or unit of stock and other securities) paid by investors in the Financing, if the Financing is an issuance of stock (or unit of stock and other securities), or (b) the price paid by investors in the Financing, expressed as a percentage of the face amount of debt securities, if the Financing is an issuance of debt securities (or units of debt securities and other securities) (including debt securities convertible into stock).

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Document and Entity Information	3 Months Ended
	Dec. 31, 2011	Feb. 21, 2012
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Dec. 31, 2011
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q1
Trading Symbol	MXCS
Entity Registrant Name	MAX CASH MEDIA INC
Entity Central Index Key	0001423107
Current Fiscal Year End Date	--09-30
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		6,370,000

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Condensed Statements of Operations (USD $)	3 Months Ended		54 Months Ended
	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2011
Operating Expenses
Professional fees	$ 44,681	$ 17,374	$ 330,468
General and administrative	3,303	2,188	64,968
Total Operating Expenses	47,984	19,562	395,436
Loss from Operations	(47,984)	(19,562)	(395,436)
Other Income / (Expense)
Interest Income	6	2	897
Interest Expense	(44,768)	(2,773)	(83,552)
Other Expense			(2,000,000)
Total Other Income / (Expense) - net	(44,762)	(2,771)	(2,082,655)
LOSS FROM OPERATIONS BEFORE INCOME TAXES	(92,746)	(22,333)	(2,478,091)
Provision for Income Taxes
NET LOSS	$ (92,746)	$ (22,333)	$ (2,478,091)
Net Loss Per Share - Basic and Diluted	$ (0.01)	$ 0.00
Weighted average number of shares outstanding during the year/period - Basic and Diluted	6,370,000	6,370,000

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FORGIVENESS OF A PAYABLE

3 Months Ended

Dec. 31, 2011

FORGIVENESS OF A PAYABLE

NOTE 5 FORGIVENESS OF A PAYABLE

During the year ended September 30, 2009, a related party forgave accounts payable in the amount of $5,000 for services provided. The payable was reclassified to additional paid in capital as an in kind contribution of services (See Notes 4(B) and 8).

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STOCKHOLDERS' EQUITY

3 Months Ended

Dec. 31, 2011

STOCKHOLDERS' EQUITY

NOTE 4 STOCKHOLDERS’ EQUITY

(A) Common Stock Issued for Cash

During October 2007, the Company issued 1,115,000 shares of common stock for $111,500 ($0.10/share).

During October 2007, the Company collected $25,500 ($0.10/share) for the sale of 255,000 shares of common stock made during the period from July 9, 2007 (inception) through September 30, 2007.

(B) In-Kind Contribution

For the three months ended December 31, 2011, a shareholder of the Company contributed services having a fair value of $650 (See Note 8).

For the year ended December 31, 2011, a shareholder of the Company contributed services having a fair value of $2,600 (See Note 8).

During the year ended September 30, 2009, a related party forgave accounts payable in the amount of $5,000 for services provided. The payable was reclassified to additional paid in capital as an in kind contribution of services (See Notes 5 and 8).

For the year ended September 30, 2010, a shareholder of the Company contributed services having a fair value of $2,600 (See Note 8).

For the year ended September 30, 2009, a shareholder of the Company contributed services having a fair value of $2,600 (See Note 8).

For the year ended September 30, 2008, a shareholder of the Company contributed services having a fair value of $2,600 (See Note 8).

For the year ended September 30, 2007 a shareholder of the Company contributed services having a fair value of $593. (See Note 8)

(C) Stock Issued for Services

On July 9, 2007, the Company issued 5,000,000 shares of common stock to its founder having a fair value of $5,000 ($0.001/share) in exchange for services provided (See Note 8).

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RELATED PARTY TRANSACTIONS

3 Months Ended

Dec. 31, 2011

RELATED PARTY TRANSACTIONS

NOTE 8 RELATED PARTY TRANSACTIONS

For the three months ended December 31, 2011, a shareholder of the Company contributed services having a fair value of $650 (See Note 4(B)).

For the year ended December 31, 2011, a shareholder of the Company contributed services having a fair value of $2,600 (See Note 4(B)).

For the year ended September 30, 2010, a shareholder of the Company contributed services having a fair value of $2,600 (See Note 4(B)).

For the year ended September 30, 2009, a shareholder of the Company contributed services having a fair value of $2,600 (See Note 4(B)).

For the year ended September 30, 2008 a shareholder of the Company contributed services having a fair value of $2,600 (See Note 4(B)).

During the year ended September 30, 2009, a related party forgave accounts payable in the amount of $5,000 for services provided. The payable was reclassified to additional paid in capital as an in kind contribution of services (See Note 5).

For the year ended September 30, 2007, the Company received $1,100 from a principal stockholder. Pursuant to the terms of the loan, the loan is non interest bearing, unsecured and due on demand. The loan was repaid on October 23, 2007 (See Note 6).

For the year ended September 30, 2007, a shareholder of the Company contributed services having a fair value of $593 (See Note 4(B)).

On July 9, 2007, the Company issued 5,000,000 shares of common stock to its founder having a fair value of $5,000 ($0.001/share) in exchange for services provided (See Note 4B)).

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LOAN PAYABLE

3 Months Ended

Dec. 31, 2011

LOAN PAYABLE

NOTE 6 LOAN PAYABLE

On May 10, 2010, the Company issued a promissory note in the amount of $65,000 due November 9, 2011 and bearing interest at a rate of 10% per annum. On November 9, 2011, the due date of the loan was extended to May 9, 2013. As of December 31, 2011, the Company has accrued $10,685 in interest payable.

(See Note 10).

During 2009, the Company owed $4,585 to an unrelated third party for expenses paid on behalf of the Company. The loan was repaid in full during August 2009.

For the year ended September 30, 2007, the Company received $1,100 from a principal stockholder. Pursuant to the terms of the loan, the loan is non interest bearing, unsecured and due on demand. The loan was repaid on October 23, 2007 (See Note 8).

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CONVERTIBLE NOTES PAYABLE

3 Months Ended

Dec. 31, 2011

CONVERTIBLE NOTES PAYABLE

NOTE 7 CONVERTIBLE NOTES PAYABLE

During August and September, 2011, the Company had a closing of a private placement (the “Bridge Offering”) of $2,000,000 principal amount of 8% Secured Convertible Promissory Notes (the “Notes”).    The Notes mature three months from the date of issuance.   Accrued interest is payable at maturity or upon conversion. As of December 31, 2011 the note payable is currently in default. All of the outstanding principal amount of, and accrued but unpaid interest on, the Notes will automatically be converted into shares of the Company’s Common Stock simultaneously with the closing of the Merger (if it occurs) at a price of $1.00 per share (subject to adjustment in certain circumstances).   For the year ended December 31, 2011, the closing of the merger did not take place and the convertible notes payable are outstanding. The company accrued $59,288 of interest on the note as of December 31, 2011. On December 30, 2011 the Company issued an amendment to the 10% convertible notes to exclude the August and September $2,000,000 8% convertible notes (“Bridge Offering”) as financing for the purposes of determining the conversion of the notes.

During August 2011, the Company issued $66,125 of 10% convertible notes payable due the earlier of January 31, 2013 or upon the completion by the Company of a securities offering or other financing in which the Company raises a minimum of one million dollars.  The notes and accrued interest will be converted into the same instruments issued in the offering at the same price and terms in the offering.  Each holder is limited in their conversion to 9.99% of the total outstanding common shares.  If the notes are not converted, the notes require the Company to pay interest in shares of common stock on the due date based on the 10 day weighted average price of the Company’s common stock or if not such price exists, at a rate determined by the Board of Directors.  The notes are unsecured. The company accrued $2,661 of interest on the notes as of December 31, 2011.

On July 29, 2009, the Company issued a convertible promissory note in the amount of $50,000 due January 28, 2011 and bearing interest at a rate of 9% per annum. On January 28, 2011 the Company extended the due date of the note to July 27, 2012. All debt can be converted into shares at a conversion price to be mutually determined by the Company and the holder of the note. As of December 31, 2011, the Company has accrued $10,911 in interest payable.

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GOING CONCERN

3 Months Ended

Dec. 31, 2011

GOING CONCERN

NOTE 9 GOING CONCERN

As reflected in the accompanying financial statements, the Company is in the development stage and has accumulated losses of $2,478,091 and a negative cash flow from operations of $287,825 since inception. In addition, the Company has a stockholders’ deficiency of $2,319,448 and working capital deficiency of $2,188,770 as of December 31, 2011.   In addition, $2,000,000 of notes payable are currently in default. This raises substantial doubt about its ability to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan.  The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

The Company intends to make every commercially reasonable effort to pursue collection of the notes receivable, including all legal options.  Additionally, the Company expects to raise additional capital to meet its working capital needs, although there can be no assurance it will be successful in those efforts. The Company believes that these actions provide the opportunity for the Company to continue as a going concern.

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Condensed Statement of Changes in Stockholders' Equity (Deficiency) (USD $)	Total	Cash	Founder Services	Common stock	Common stock Cash	Common stock Founder Services	Additional paid-in capital	Additional paid-in capital Cash	Deficit accumulated during the development stage	Subscription Receivable	Subscription Receivable Cash
Beginning Balance at Jul. 08, 2007
Common stock issued (in shares)					255,000	5,000,000
Common stock issued			$ 5,000		$ 255	$ 5,000		$ 25,245			$ (25,500)
In kind contribution of services	593						593
Net loss	(16,593)								(16,593)
Ending Balance at Sep. 30, 2007	(11,000)			5,255			25,838		(16,593)	(25,500)
Ending Balance (in shares) at Sep. 30, 2007				5,255,000
Common stock issued (in shares)					1,115,000
Common stock issued		111,500			1,115			110,385
Cash received for subscription receivable	25,500									25,500
In kind contribution of services	2,600						2,600
Net loss	(127,900)								(127,900)
Ending Balance at Sep. 30, 2008	700			6,370			138,823		(144,493)
Ending Balance (in shares) at Sep. 30, 2008				6,370,000
In kind contribution of services	2,600						2,600
Forgiveness of a third party account payable	5,000						5,000
Net loss	(40,718)								(40,718)
Ending Balance at Sep. 30, 2009	(32,418)			6,370			146,423		(185,211)
Ending Balance (in shares) at Sep. 30, 2009				6,370,000
In kind contribution of services	2,600						2,600
Net loss	(90,826)								(90,826)
Ending Balance at Sep. 30, 2010	(120,644)			6,370			149,023		(276,037)
Ending Balance (in shares) at Sep. 30, 2010				6,370,000
In kind contribution of services	2,600						2,600
Net loss	(2,109,308)								(2,109,308)
Ending Balance at Sep. 30, 2011	(2,227,352)			6,370			151,623		(2,385,345)
Ending Balance (in shares) at Sep. 30, 2011				6,370,000
In kind contribution of services	650						650
Net loss	(92,746)								(92,746)
Ending Balance at Dec. 31, 2011	$ (2,319,448)			$ 6,370			$ 152,273		$ (2,478,091)
Ending Balance (in shares) at Dec. 31, 2011				6,370,000

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DEBT ISSUE COSTS

3 Months Ended

Dec. 31, 2011

DEBT ISSUE COSTS

NOTE 3 DEBT ISSUE COSTS

During the three months ended December 31, 2011 and the year ending September 30, 2011, the Company paid debt issue costs totaling $0 and $5,589, respectively.

The following is a summary of the Company’s debt issue costs:

Debt issue costs paid – 2011	$	5,589
Amortization of debt issue costs – September 30, 2011		(3,353	)
Debt issue costs – net – September 30,  2011	$	2,236
Amortization of debt issue costs – December 31, 2011	$	(1,789	)
Debt issue costs – net – December 31, 2011	$	447

During 2011, the Company amortized $5,142 of debt issue costs.