UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-KSB
(Mark
one)
x
ANNUAL REPORT UNDER
SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the
fiscal year ended
December 31,
2007
o
TRANSITION REPORT UNDER
SECTION 13 OR 15 (d) OF THE EXCHANGE ACT OF 1934
For the
transition period from ________ to ________
Commission
file number [000-20675]
My
Screen Mobile, Inc.
(Name
of small business issuer in its charter)
|
Delaware
|
|
23-2932617
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|
(State or other jurisdiction
of incorporation or organization)
|
|
(IRS Employer Identification
No.)
|
70
Yorkville Ave, Suite 300, Toronto, Ontario, Canada M5R
1B9
(Address
of principal executive offices)
866-936-8333
(Issuer's
telephone number)
Securities
registered under Section 12(g) of the Exchange Act:
Common
Stock
(Title of
class)
Check
whether the issuer is not required to file reports pursuant to Section 13 or
15(d) of the Exchange Act.
o
Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes
o
No
x
Check if
there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant’s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB.
o
.
Indicate
by checkmark whether the registrant is a shell company (as defined in Rule 12b-2
of the Exchange Act).
Yes
o
No
x
The
Company’s revenues for the year ended December 31, 2007 were
$[NIL].
As
of
December 15,
2008, the aggregate market value of the voting stock held by non-affiliates of
the registrant (based on a closing price of $1.25 per share was
$43,994,546.
The
number of shares of the registrant's common stock outstanding as of December 15,
2008, was 131,695,637.
Transitional
Small Business Disclosure Format (check one): Yes
o
No
x
MY
SCREEN MOBILE, INC.
(A
DEVELOPMENT STAGE COMPANY)
Formerly
Nouveau International Inc.
TABLE
OF CONTENTS
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Page
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PART
I
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4
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Item
1. Description of Business
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4
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Item
2. Description of Property
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14
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Item
3. Legal Proceedings
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15
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Item
4. Submission of Matters to a Vote of Security Holders
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15
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PART
II
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15
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Item
5. Market for Common Equity and Related Stockholder Matters and Small
Business Issuer Purchases of Equity Securities
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15
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Item
6. Managements' Discussion and Analysis or Plan of
Operation
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18
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Item
7. Financial Statements
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21
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Item
8. Changes In and Disagreements with Accountants on Accounting and
Financial Disclosure
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21
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Item
8A. Controls and Procedures
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21
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Item
8B. Other Information
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23
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PART
III
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23
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Item
9. Directors, Executive Officers, Promoters, Control Persons and Corporate
Governance; Compliance with Section 16(a) of the Exchange
Act
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23
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Item
10. Executive Compensation
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25
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Item
11. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
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26
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Item
12. Certain Relationships and Related Transactions, and Directors
Independence
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28
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Item
13. Exhibits
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31
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Item
14. Principal Accountant Fees and Services
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31
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Signatures
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33
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PART
I.
ITEM
1. DESCRIPTION OF THE BUSINESS
BACKGROUND
My Screen
Mobile, Inc., a Delaware corporation, was incorporated in the State of Delaware
on January 10, 1996, under the name Nouveau Health Management,
Inc. On January 16, 1996, we entered into a Merger Agreement with
Health Management, Inc., a Florida corporation, in which Health Management, Inc.
was merged with and into us. In connection with our merger with
Health Management, Inc., we changed our name to Nouveau International,
Inc. On January 17, 1996, we entered into an Agreement and Plan of
Merger with Nouveau International, Inc., a Pennsylvania corporation, and Nouveau
Acquisition Corp., a Delaware corporation and our wholly owned subsidiary,
pursuant to which Nouveau Acquisition Corp. was merged with and into Nouveau
International, Inc., which became our wholly owned subsidiary. On
March 31, 1998, we ceased all of our operations and remained dormant until
September 27, 2006, when we filed a Certificate of Renewal of Charter with the
Delaware Secretary of State.
On April
4, 2007, we acquired the technology that forms the basis of our current business
from its inventor in exchange for 10,000,000 shares of our common stock, and on
April 19, 2007, we changed our name to My Screen Mobile, Inc.
GENERAL
Our
technology is an application for direct permission and incentive-based
advertising to mobile telephones, which we expect to launch for commercial use
in the end of 2009. It allows mobile operators to deliver rich,
compelling and highly targeted communications, including advertisements, to
their subscribers at the end of each telephone call or upon sending a text
message and rewards mobile subscribers for receiving and viewing such
communications. Using our subscriber opt-in technology, mobile
operators can direct communications and advertisements to subscribers who opt
in, based on each subscriber’s individual preferences. We believe
that the combination of permission and incentive-based advertising will result
in an intimate and contextual advertisement message having a greater impact than
other forms of advertising such as email, television or radio. Our
technology is also simple to deploy, modify and use, and provides advertisers
with rich reporting and sophisticated account management.
PRODUCTS
Our
advertising solution allows mobile operators to deliver highly targeted
communications, including advertisements, to mobile telephones and other mobile
devices. We can deliver rich, full-screen image based advertisements
to mobile devices that employ certain operating systems with which our image
display technology is currently compatible, such as Windows Mobile, Symbian,
Palm, RIM, and Android, which are optimized for those handset. We can
also deliver the advertisements in SMS Text format to users having devices that
do not operate on compatible operating systems.
We have
developed a unique click-through banner technology, which will allow subscribers
to respond to an advertiser with one click of a “hot-key” on their
telephone. The one-click may result in, for example, a visit to the
advertiser’s website for special promotions, or direct connection to an
advertiser’s local or toll-free hotline to hear about exciting
offers.
We also
have a proprietary online advertisement management system enabling advertisers
to target categories of users grouped according to one or more common
demographics, including, but not limited to, age, income, gender, marital
status, device brand and model, carrier, geographic location and lifestyle
preferences. Through the easy-to-use management system, advertisers
will be able to control, in real time, the frequency and intervals of the
display of advertisements for each category of subscribers, and the immediacy of
advertisement delivery to their mobile device.
ITEM 1. DESCRIPTION OF THE
BUSINESS - continued
Our
application can be downloaded to a user’s mobile handset wirelessly, from our
website, or through a mobile operator’s website. It can also be
pre-embedded on the mobile device at the time of purchase, or pre-embedded on
the mobile operator’s SIM cards.
Subscribers
To
subscribe to the service, users will be required to provide basic demographic
information such as their age, gender, and marital status, their mobile
telephone number, details specific to their mobile handset, contact information,
and their lifestyle category preferences. Each subscriber can choose
the maximum number of advertisements per day her or she desires to receive so as
not to be overwhelmed by the service, and may opt-in and out of the service at
anytime.
Subscribers
will be rewarded for each advertisement he or she views on their mobile
telephone, through reward points or other financial incentives. We
have developed a proprietary eWallet module, into which all rewards will be
tracked, deposited and/or stored, and which subscribers will be able to redeem
to receive their incentives. We are also in the process of developing
technology that will enable subscribers to transfer earned rewards to
third-party loyalty cards, prepaid credit cards or gift cards, or donate the
rewards to a charity.
Advertisers
We will
capture subscriber data that enables us to direct communications to a highly
targeted audience, based on each subscriber’s individual
preferences. Advertisers will determine the number of subscribers
within a specified demographic category that they wish to target with
advertisements, the daily frequency each recipient will receive the
advertisement, and the total number of advertisements to be delivered to the
recipients within a specific time period.
We have
also developed an additional sales model which includes an auction format in
which advertisers bid on the right to deliver advertisements to categories of
subscribers, which are based on subscriber demographics. The system
will set a minimum base rate for each category of subscriber, and the advertiser
that bids the highest price per advertisement view, which must not be lower than
the minimum base rate, will win the auction. The minimum base rates
shall be set to result in our receipt of profit for each advertisement that is
viewed. In the event, an auction results in the sale of a category at
a price higher than the minimum base rate, we would receive the excess
profit.
Our
advertisers will pay only for advertisements delivered to the subscriber’s
device and viewed by the subscriber. We will provide our advertisers
with a host of customizable reports that will include statistics and data
related to advertisements delivered to subscribers, such as the delivery times,
the times advertisements are viewed, coupon advertisements saved for later use,
and any interaction the subscriber may engage in while pressing a
“hot-key”(link to website, phone number, etc).
PRODUCT
DEVELOPMENT
During
2007, we spent $2,307,077 on programming and development activities, and between
January 1, 2008, and November 30, 2008, we spent $1,587,907 on programming and
development activities.
ITEM
1. DESCRIPTION OF THE BUSINESS - continued
INDUSTRY
OVERVIEW
Mobile
Marketing
According
to the Cellular Telecommunications Industry Association (CTIA), as of June 2008
there were over 262.7 million mobile telephones in circulation in the United
States alone, and it is anticipated that there will be over 3.3 billion mobile
telephones in use globally by the end of 2008. It is expected that
this number will rise to approx. 5.6 billion by 2013 (
Worldwide Cellular User Forecasts,
2008-2013
). The wireless industry has recently begun to focus on the
potential of mobile marketing and is exploring ways to help generate additional
revenue, increase average revenue per use, and reduce churn.
Industry
sources estimate that the value of wireless advertising and transactions
worldwide will be between $9.6 billion (Shosteck Group) and $19 billion (ABI
Research) by 2010. Wireless offers a unique opportunity for
advertisers. As the technology evolves it is expected that an
advertiser will be able to deliver a message to their targeted recipient close
to the moment of intent, or when they are positioned to buy.
MARKETING
Target
Markets and Strategy
We have
made the strategic determination to partner with mobile operators and other
third parties, to develop markets globally. We believe that the
strength of recognized brands, and the ability to provide access to large
numbers of subscribers and advertisers, provides the fastest way to grow our
customer base. We have entered into an Exclusive Territory Agreement
with Orascom Telecom Holdings, S.A.E. and Weather Investments, S.P.A., an
international telecommunications provider, to promote and deliver our services
within Algeria, Bangladesh, Canada, Egypt, Greece, Italy, North Korea, Pakistan,
Tunisia and Zimbabwe. We have also entered into a joint venture
agreement with respect to distribution of our technology in Israel, and are
currently negotiating agreements in connection with other
countries.
We
believe our technology will attract a broad based audience across a multitude of
demographic profiles. In general, we intend to attract subscribers through viral
Internet marketing campaigns, public relations and media
campaigns. We also intend to leverage our mobile operator partners
through joint marketing campaigns. Our management has extensive
experience effectively using direct marketing, television, and print mediums to
acquire paying subscribers. Our specific strategy for each territory,
however, may vary based on their specific market conditions.
Product
Differentiation
Mobile
advertising is different from other forms of mass media marketing, in that it is
direct and private and can utilize the unique attributes of mobile devices to
create a truly engaging advertising experience. Mobile telephones are
an extremely personal means of communication, and handset screens are seen as
non-public real estate. There is a high level of attention paid to messages that
are received by the individual, since the device is deemed so personal to the
owner. We believe that this will induce a higher than average response rate for
a call to action, than other forms of advertising.
In
addition, the real estate on a mobile telephone is very small, which we believe
makes banner advertising likely ineffective on a WAP browser. Users
are generally more interested in the content they are searching and may deem
banner advertisements intrusive to their search query. In addition,
banner advertisements can only be directed to mobile telephone users who surf
the web on their mobile telephones, however, less than 20% of consumers use
their mobile telephone to browse the internet.
Mobile users have been
very conservative. The industry has found it very difficult to persuade
customers to do anything other than use voice and send text. Browsing on the
internet through a WAP browser and clicking on advertisements via the mobile
device is a big step for users to take.
ITEM
1. DESCRIPTION OF THE BUSINESS - continued
COMPETITION
Third
Screen Media, Screen Tonic, Ad Mob and Enpocket are some of our significant
competitors. Their method of advertisement delivery consists of launching a web
browser on a mobile handset which displays a banner advertisement across the top
of the page, which is targeted to the web site being
visited. Although we believe our products have certain advantages
over the products currently offered by our competitors, the mobile advertising
industry is very competitive. Many of our competitors, such as Third
Screen Media, which was recently purchased by a division of AOL, have
substantially greater financial, technical, and marketing resources, larger
customer bases, longer operating histories, greater name recognition, and more
established relationships in the industry than us. They can also
devote greater resources to the marketing and sale of their products and adopt
more aggressive pricing policies than we can.
INTELLECTUAL
PROPERTY
We have
filed patent applications for our technology with the United States Patent and
Trademark Office, the Canadian Intellectual Property Office and the World
Intellectual Property Organization.
On August
26, 2008 we filed an application to register the name “MyScreen” with the
Canadian Intellectual Property Office. On or about November 28, 2008,
we filed an application to register the name “GEOLOC” with the United States
Patent & Trademark Office.
We own
the following domain names, and have copyrights on the content on all of the
websites operating under those domain names: myscreen.com,
myscreenmobile.com,
myscreen.bz,
myscreen.com.mx, myscreen.sh, myscreen.uk.com, myscreen.uy.com, ,
myscreen.kids.us, myscreen.ws, myscreen.la, myscreen.me, myscreen.br.com,
myscreen.de.com, myscreen.eu.com, myscreen.in, myscreen.jp, myscreenblue.com,
myscreenbluu.com, myscreenenabled.com, myscreenenabled.net, myscreenmobile.net,
myscreenmobile.biz, myscreenmobile.in, myscreen.com.pk, myscreen.net.pk,
myscreen.org.pk and myscreen.pk.
The
mobile advertising market is characterized by the existence of a large number of
patents, trademarks and copyrights, as well as litigation based on allegations
of patent infringement, copyright infringement and other violations of
intellectual property rights. The protection of our intellectual
property rights, including, our proprietary technology and trade secrets are
important to our future success. Although we have filed for patents
and trademarks to protect our intellectual property, to prevent misappropriation
of our technology and to deter independent third-party development of similar
technologies, there is no assurance that these steps will be
adequate. Our technology and products may not be able to sustain
third party claims or rights against their use. We expect that
participants in our markets will be increasingly subject to infringement claims
as the number of products and competitors in our industry segment grows. Any
intellectual property claims, with or without merit, could be time-consuming,
expensive to litigate or settle, divert management’s attention from
administering our core business, cause service delays or require us to enter
into royalty or licensing agreements. Such royalty or licensing
agreements might not be available on terms acceptable to us or at
all. As a result, any such claim could have a material adverse effect
upon our business, results of operations and financial condition.
EMPLOYEES
As of
December 15, 2008, we had 12 full-time employees, including 3 in product
development, 1 in sales, 2 in administration, 1 in investor relations, 2 in
business development, 2 in creative design, and 1 system support
employee.
ITEM
1. DESCRIPTION OF THE BUSINESS - continued
GOVERNMENT
REGULATION
Like
many companies, we are subject to existing and potential government regulation.
While there are numerous laws and regulations applicable to the mobile
telecommunication and advertising industries in general, there are few laws or
regulations specifically applicable to the mobile advertising
businesses. Accordingly, the application of existing laws to mobile
advertising is unclear in many instances.
Compliance
with federal, state, local and foreign laws relating to the mobile
telecommunications and advertising industries may impose upon us significant
costs and risks, or may subject us to liability if we do not successfully comply
with their requirements, whether intentionally or unintentionally. We
may be unable to determine if and when any specific legislation may be adopted.
If certain proposals were to be adopted, our business could be harmed by
increased expenses or lost revenue opportunities, and other unforeseen ways. We
anticipate that new laws and regulations affecting us will be implemented in the
future. Those new laws, in addition to new applications of existing laws, could
expose us to substantial liabilities and compliance costs.
RISK
FACTORS
Our
business is subject to numerous risks. We caution you that the following
important factors, among others, could cause our actual results to differ
materially from those expressed in forward-looking statements made by us or on
our behalf in filings with the SEC, press releases, communications with
investors and oral statements. Any or all of our forward-looking statements in
this Annual Report on Form 10-KSB and in any other public statements we
make may turn out to be wrong. They can be affected by inaccurate assumptions we
might make or by known or unknown risks and uncertainties. Many factors
mentioned in the discussion below will be important in determining future
results. Consequently, no forward-looking statement can be guaranteed. Actual
future results may vary materially from those anticipated in forward-looking
statements. We undertake no obligation to update any forward-looking statements,
whether as a result of new information, future events or otherwise. You are
advised, however, to consult any further disclosure we make in our reports filed
with the SEC.
Our
limited operating history makes evaluation of our business
difficult.
We
acquired our current mobile technology in April 2007, and have not yet
commercially deployed our technology. We, therefore, have limited
historical financial data related to our current business, upon which to base
planned operating expenses or forecast accurately our future operating results.
Our limited operating history will make it difficult for investors to evaluate
our business and prospects. Our failure to address these risks and difficulties
successfully could seriously harm us.
We expect that
our anticipated future growth may strain our management, administrative,
operational and financial infrastructure, which could adversely affect our
business.
We have
undergone, and anticipate that significant expansion of our present operations
will be required to capitalize on potential growth in market opportunities. This
expansion has placed, and is expected to continue to place, a significant strain
on our management, operational and financial resources. We expect to add a
significant number of additional key personnel in the future, including key
managerial and technical employees who will have to be fully integrated into our
operations. In order to manage our growth, we will be required to continue to
implement and improve our operational and financial systems, to expand existing
operations, to attract and retain superior management, and to train, manage and
expand our employee base. We cannot assure you that we will be able to
effectively manage the expansion of our operations, that our systems, procedures
or controls will be adequate to support our operations or that our management
will be able to successfully implement our business plan. If we are unable to
manage growth effectively, our business, financial condition and results of
operations could be materially adversely affected.
ITEM
1. DESCRIPTION OF THE BUSINESS - continued
Our executive
officers and certain key personnel are critical to our success, and the loss of
these officers and key personnel could harm our
business.
Our
performance is substantially dependent on the continued services and performance
of our executive officers and other key personnel, and our ability to retain and
motivate our officers and key employees. The loss of the services of one or more
of our officers or other key employees could have a material adverse effect on
our business, prospects, financial condition and results of operations. Our
future success also depends on our ability to identify, attract, hire, train,
retain and motivate other highly skilled technical, managerial and marketing
personnel. Competition for such personnel is intense, and we cannot assure you
that we will be successful in attracting and retaining such personnel. The
failure to attract and retain our officers or the necessary technical,
managerial and marketing personnel could have a material adverse effect on our
business, prospects, financial condition and results of
operations.
The
market for mobile advertising services is in the early stages of development,
and if the market for our services does not develop as we anticipate, it will
have a material adverse effect on our business, prospects, financial condition
and results of operations.
Mobile
marketing and advertising, in general, are in the early stages of development.
Our future revenue and profits are substantially dependent upon the widespread
acceptance, growth, and use of mobile telephony an effective advertising
medium. Most advertisers have generally relied upon more traditional
forms of media advertising and have no, or only limited, experience advertising
on mobile telephones. Mobile marketing is still in an early stage of development
and may not be accepted by consumers for many reasons. If consumers reject our
services, or opt-in mobile advertising in general, the commercial utility of our
technology and services may not develop as we anticipate.
We will rely on
our advertiser network partners to provide us access to their advertisers, and
if they do not, it could have an adverse impact on our
business.
We will
rely on our advertiser network partners to provide us with access to their
advertisers so that we can deploy their advertisements to customers in order to
generate revenue when a consumer views an advertisement. Our
success depends, in part, on the maintenance and growth of our advertiser
network partners. If we are unable to develop or maintain relationships with
these partners, our operating results and financial condition will
suffer.
We may experience
downward pressure on our advertising revenues if advertisers do not obtain a
competitive return on investment, which could have a material and adverse effect
on our financial results.
We may
experience downward pressure on our future advertising revenues if advertisers
do not obtain a favorable return on investment from our mobile advertising in
comparison to traditional advertising or mobile advertising offered by
competitors. Our technology employs certain filtering processes with
respect to the quality and demographics of the consumer traffic to which our
advertisers’ messages will be targeted, including, having our customers complete
a registration on which they identify their lifestyle preferences and other
demographic information. In addition, we will limit the number of
paid advertisements each consumer may receive per day, to, among other things,
decrease the risk that consumers will become inundated with too many
advertisements, thereby reducing the effectiveness of each
advertisement. There is a risk that a certain number of
advertisements will be directed to consumers deemed to be less valuable by our
advertisers. This may adversely effect the return on investment of
our advertisers, harm our relationships with our advertisers and slow down the
growth of, or prevent us from growing, our advertiser base, which would
adversely affect our revenues.
ITEM
1. DESCRIPTION OF THE BUSINESS - continued
We will depend on
mobile telecommunication providers to attract a significant percentage of our
customers, and if our relationship with them deteriorates or terminates, we may
be unable to attract customers, which would adversely affect our business and
results of operations.
To
succeed, we must attract and retain a large number of customers on a
cost-effective basis. We will rely on a variety of methods to attract customers,
namely by partnering with telecommunications providers to promote our services
to their customers. As a result, we expect that many of our customers will
be generated through our telecommunication provider partners. If we are unable
to grow our base of telecommunications provider partners or maintain
relationships with our existing partners, or our partners do not adequately
promote our services, we may not be able to attract new customers or retain
existing customers on a cost-effective basis and, as a result, our revenue and
results of operations would be affected adversely. In addition, if
our network of telecommunication providers does not grow and does not improve
over time, advertisers may reduce or terminate their business with us, which
would have an adverse effect on our revenue and results of
operations.
Failure
to adequately protect our intellectual property and proprietary rights could
harm our competitive position.
Our
success is substantially dependent upon our proprietary technology, which
relates to a variety of business, technology, and transactional processes
associated with our mobile advertising technology. We rely on a
combination of patent, trademark, copyright and trade secret laws, as well as
confidentiality agreements and technical measures, to protect our proprietary
rights. Although we have filed for patent protection over aspects of
our technology, much of our proprietary information may not be patentable. We
cannot assure you that any pending patent applications will be issued or that
their scope is broad enough to provide us with meaningful
protection. Although we have filed to obtain trademarks over certain
of the marks we use in our business, we cannot assure you that we will be able
to secure significant protection for these marks. Despite our efforts to protect
our proprietary rights, unauthorized parties may attempt to copy aspects of our
technology and/or services or to obtain and use information that we regard as
proprietary. We cannot assure you that our means of protecting our proprietary
rights will be adequate or that our competitors will not independently develop
similar technology or duplicate our services or design around patents issued to
us or our other intellectual property rights. If we are unable to adequately
protect our intellectual property and proprietary rights, our business and our
operations could be adversely affected.
We may be subject
to intellectual property claims that create uncertainty about ownership of
technology essential to our business and divert our managerial and other
resources.
There has
been a substantial amount of litigation in the technology industry regarding
intellectual property rights. Our success depends, in part, on our ability to
protect our intellectual property and to operate without infringing on the
intellectual property rights of others in the process. There can be no guarantee
that any of our intellectual property will be adequately safeguarded, or that it
will not be challenged by third parties. We may be subject to patent or
trademark infringement claims or other intellectual property infringement claims
that would be costly to defend and could limit our ability to use certain
critical technologies. We may also become subject to interference
proceedings conducted in the patent and trademark offices of various countries
to determine the priority of inventions.
Any
patent litigation or interference proceedings could negatively impact our
business by diverting resources and management attention away from other aspects
of our business and adding uncertainty as to the ownership of technology and
services that we view as proprietary and essential to our business. Furthermore,
because of the substantial amount of discovery required in connection with
intellectual property litigation, there is a risk that some of our confidential
information could be compromised by disclosure during this type of litigation.
In addition, during the course of this kind of litigation, there could be public
announcements of the results of hearings, motions or other interim proceedings
or developments in the litigation. If investors perceive these results to be
negative, it could have an adverse effect on the trading price of our common
stock.
ITEM
1. DESCRIPTION OF THE BUSINESS - continued
In
addition, a successful claim of patent or trademark infringement against us and
our failure or inability to obtain a license for the infringed or similar
technology or trademark on reasonable terms, or at all, could have a material
adverse effect on our business. Also, an adverse determination of any
litigation or defense proceedings could cause us to pay substantial damages,
including treble damages if we willfully infringe, and, also, could put our
patent applications at risk of not being issued.
Government and
legal regulations may damage our business.
Because
the mobile advertising business is in its infancy, we are not currently subject
to direct regulation by any government agency, other than regulations generally
applicable to the mobile telecommunications, marketing and advertising
industries. The mobile telecommunications industry in general is
subject to regulation by the Federal Communications Commission and other
foreign, federal, state and local agencies. Existing or future laws
and regulations may inhibit our ability to expand our business and introduce new
products and services, or may restrict the use of our services or the features
we offer. In addition, changes to the existing regulatory framework
could adversely affect our business plans.
The
mobile telecommunications, marketing and advertising industries face uncertainty
related to future government regulation through the application of new or
existing federal, state and international laws. Due to the rapid growth and
widespread use of mobile telephones, legislatures at the international, federal
and state level have enacted and may continue to enact various laws and
regulations relating to the mobile telecommunications industry.
Laws and
regulations may be adopted in the future that directly govern mobile
advertising. The adoption of laws or regulations relating to the
placement of advertisements, defamation or taxation may inhibit the growth in
use of mobile advertising, which in turn, could decrease the demand for our
technology and services and increase our cost of doing business or otherwise
have a material adverse effect on our business, prospects, financial condition
and results of operations.
In
addition, foreign governments may pass laws which could negatively impact our
business and/or may prosecute us for violating existing laws. Such laws might
include EU member country conforming legislation under applicable EU Privacy and
Data Protection Directives. Any costs incurred in addressing foreign laws could
negatively affect the viability of our business.
We
may incur liabilities for the activities of our advertisers, distribution
partners and other users of our services, which could adversely affect our
business.
In
obtaining advertisements, we may rely on the content and information provided to
us by our advertisers or advertiser network partners on behalf of their
individual advertisers. We may not investigate the individual business
activities of these advertisers other than the information provided to us, or
analyze the legality of, or verify the accuracy or content of advertisements. We
may not successfully avoid liability for unlawful activities carried out by our
advertisers and other users of our services.
Our
potential liability for unlawful activities of our advertisers and other users
of our services could require us to implement measures to reduce our exposure to
such liability, which may require us, among other things, to spend substantial
resources, to discontinue certain service offerings or to terminate certain
partner relationships. For example, as a result of the actions of advertisers in
our network, we may be subject to private or governmental actions relating to a
wide variety of issues, such as privacy, gambling, promotions, and intellectual
property ownership and infringement. We may be required to indemnify these
distribution partners against liabilities or losses resulting from the content
of the advertisements we deliver or resulting from third-party intellectual
property infringement claims. Any costs incurred as a result of such liability
or asserted liability could have a material adverse effect on our business,
operating results and financial condition.
ITEM
1. DESCRIPTION OF THE BUSINESS - continued
We
face competition from internet and traditional media companies, and we may not
be included in the advertising budgets of large advertisers, which could harm
our operating results.
Although
we believe our products have certain advantages over the products currently
offered by our competitors, the mobile advertising industry is very
competitive. Many of our competitors, such as Third Screen Media,
which was recently purchased by a division of AOL, have substantially greater
financial, technical, and marketing resources, larger customer bases, longer
operating histories, greater name recognition, and more established
relationships in the industry than us. They can also devote greater
resources to the marketing and sale of their products and adopt more aggressive
pricing policies than we can.
If we are
unable to successfully compete in our markets, our operating results will be
adversely effected.
In
addition, we face competition from companies that offer internet advertising and
traditional media advertising opportunities. Most large advertisers have set
advertising budgets. Since our industry is so new, there may not be
any funds available in advertising budgets for mobile advertising. We expect
that large advertisers will continue to focus most of their advertising efforts
on internet and traditional media. If we fail to convince these companies to
spend a portion of their advertising budgets with us, or if our existing
advertisers reduce the amount they spend on our programs, our operating results
would be harmed.
If
we are not able to respond to the rapid technological change characteristic of
our industry, our products and services may cease to be
competitive.
The
mobile telecommunications industry is characterized by rapid change in business
models and technological infrastructure, and we will need to constantly adapt to
changing markets and technologies to provide new and competitive products and
services. If we are unable to ensure that our users, advertisers, and
distribution partners have a high-quality experience with our services, then
they may become dissatisfied and stop using our products and services.
Accordingly, our future success will depend, in part, upon our ability to
develop and offer competitive products and services. We may not, however, be
able to successfully do so, and our competitors may develop innovations that
render our products and services obsolete or uncompetitive.
Our
technical systems are vulnerable to interruption and damage that may be costly
and time-consuming to resolve and may harm our business and
reputation.
A
disaster could interrupt our services for an indeterminate length of time and
severely damage our business, prospects, financial condition and results of
operations. Our systems and operations are vulnerable to damage or interruption
from:
|
|
·
|
Fire,
floods and other natural disasters;
|
|
|
·
|
telecommunications
failures;
|
|
|
·
|
terrorism,
war or sabotage;
|
|
|
·
|
penetration
of our network by unauthorized computer users and “hackers” and other
similar events;
|
|
|
·
|
other
unanticipated problems.
|
ITEM 1. DESCRIPTION OF THE
BUSINESS - continued
We may
not have developed or implemented adequate protections or safeguards to overcome
any of these events. We also may not have anticipated or addressed many of the
potential events that could threaten or undermine our technology network. Any of
these occurrences could cause material interruptions or delays in our business,
result in the loss of data or render us unable to provide services to our
customers. In addition, if a person is able to circumvent our security measures,
he or she could destroy or misappropriate valuable information or disrupt our
operations. Although we maintain property insurance, our insurance may not be
adequate to compensate us for all losses that may occur as a result of a
catastrophic system failure or other loss, and our insurers may not be able or
may decline to do so for a variety of reasons.
We rely on third
party technology and hardware providers, and a failure of service by these
providers could adversely affect our business and
reputation.
We rely
on third party providers for components of our technology platform, such as
hardware and software providers. A failure or limitation of service or available
capacity by any of these third party providers could adversely affect our
business and reputation.
We
are susceptible to general economic conditions, and a downturn in advertising
and marketing spending by merchants could adversely affect our operating
results.
Our
operating results will be subject to fluctuations based on general economic
conditions. If there was a general economic downturn that affected consumer
activity in particular, however slight, then we would expect that business
entities, including our advertisers and potential advertisers, could
substantially and immediately reduce their advertising and marketing budgets. We
believe that during periods of lower consumer activity, merchant spending on
advertising and marketing is more likely to be reduced, and more quickly, than
many other types of business expenses. These factors could cause a material
adverse effect on our operating results.
Providing
our products to customers outside the United States exposes us to risks inherent
in international business.
We expect
to offer our service outside of the United States and we intend to expand our
international operations in the future. Accordingly, we are subject to risks and
challenges that we would otherwise not face if we conducted our business only in
the United States. The risks and challenges associated with providing our
products to customers outside the United States include:
|
·
|
localization
of our products, including translation into foreign languages and
associated expenses;
|
|
·
|
laws
and business practices favoring local
competitors;
|
|
·
|
compliance
with multiple, conflicting and changing governmental laws and
regulations;
|
|
·
|
foreign
currency fluctuations;
|
|
·
|
different
pricing environments; and
|
|
·
|
regional
economic and political
conditions.
|
The above
factors could have an adverse impact on our business and results of
operations.
We
will need additional funding to meet our obligations and to pursue our business
strategy. Additional funding may not be available to us and our financial
condition could therefore be adversely affected.
We will
require additional funding to meet our ongoing obligations and to pursue our
business strategy, which may include the selective acquisition of businesses and
technologies. There can be no assurance that additional financing arrangements
will be available in amounts or on terms acceptable to us, if at all.
Furthermore, if adequate additional funds are not available, we will be required
to delay, reduce the scope of, or eliminate material parts of the implementation
of our business strategy.
ITEM
1. DESCRIPTION OF THE BUSINESS - continued
The market price
of our common stock has been and may continue to be
volatile.
The
trading price of our common stock has been and may continue to be highly
volatile and could be subject to wide fluctuations in response to various
factors. Some of the factors that may cause the market price of our common stock
to fluctuate include:
|
·
|
fluctuations
in our quarterly financial results or the quarterly financial results of
companies perceived to be similar to
us;
|
|
·
|
changes
in estimates of our financial results or recommendations by securities
analysts;
|
|
·
|
failure
of any of our products to achieve or maintain market
acceptance;
|
|
·
|
changes
in market valuations of similar
companies;
|
|
·
|
success
of competitive products;
|
|
·
|
changes
in our capital structure, such as future issuances of securities or the
incurrence of additional
debt;
|
|
·
|
announcements
by us or our competitors of significant products, contracts, acquisitions
or strategic alliances;
|
|
·
|
regulatory
developments in the United States, foreign countries or
both;
|
|
·
|
litigation
involving our company, our general industry or
both;
|
|
·
|
additions
or departures of key
personnel;
|
|
·
|
investors’
general perception of
us; and
|
|
·
|
changes
in general economic, industry and market
conditions.
|
In
addition, if the market for technology or mobile telecommunications stocks or
the stock market in general experiences a loss of investor confidence, the
trading price of our common stock could decline for reasons unrelated to our
business, financial condition or results of operations. If any of the foregoing
occurs, it could cause our stock price to fall and may expose us to class action
lawsuits that, even if unsuccessful, could be costly to defend and a distraction
to management.
We do not
currently intend to pay dividends on our common stock and, consequently, the
ability to achieve a return on an investment in our common stock will depend on
appreciation in the price of our common
stock.
We do not
expect to pay cash dividends on our common stock. Any future dividend payments
are within the absolute discretion of our board of directors and will depend on,
among other things, our results of operations, working capital requirements,
capital expenditure requirements, financial condition, contractual restrictions,
business opportunities, anticipated cash needs, provisions of applicable law and
other factors that our board of directors may deem relevant. We may not generate
sufficient cash from operations in the future to pay dividends on our common
stock.
ITEM
2. DESCRIPTION OF PROPERTIES
We lease
approximately 2,650 square feet of office space at 70 Yorkville Ave., Toronto,
Ontario, Canada. Our rent is approximately $108,372
per year. The term of our leased commenced on July 15, 2008, and
terminates on July 14, 2010. We do not maintain any other leases for
office space and own no real property. We believe that these
facilities are adequate for our current requirements.
ITEM
3. LEGAL PROCEEDINGS
We are
not a party to any pending litigation and none is contemplated or
threatened.
ITEM
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On March
11, 2007, a majority of our stockholders approved an amendment to the Articles
of Incorporation to affect a 1 for 100 reverse stock split of our common
stock. On May 11, 2007 in a special meeting, a majority of our
shareholders approved an amendment to the Articles of Incorporation to effect a
4 for 1 forward split of our common stock and approved an amendment to
change our name from Nouveau International Inc. to “My Screen Mobile
Inc.”.
PART
II.
ITEM
5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS AND SMALL BUSINESS PURCHASES OF EQUITY SECURITIES
Market
Information
Our
common stock is traded on the over-the counter market, and quoted on the
National Association of Securities Dealers Inter-dealer Quotation System under
the symbol “MYSL.PK”.
The table
below sets forth the reported high and low bid prices for the periods
indicated.
|
|
High
|
Low
|
|
FY
2007
|
|
|
|
Fourth
Quarter
|
$3.12
|
$1.20
|
|
Third
Quarter
|
$3.00
|
$2.18
|
|
Second
Quarter
|
$5.00
|
$2.45
|
|
First
Quarter
|
NA
|
NA
|
|
|
|
|
|
FY
2006
|
|
|
|
Fourth
Quarter
|
NA
|
NA
|
|
Third
Quarter
|
NA
|
NA
|
|
Second
Quarter
|
NA
|
NA
|
|
First
Quarter
|
NA
|
NA
|
The
information in the table above has been gathered from Yahoo
Finance. The above quotations may not represent actual
transactions.
As of
December 31, 2007, there were approximately 193 holders of record
of Common Stock in
certificate form, exclusive of those brokerage firms and/or clearing houses
holding the Company’s Common Stock in street name for their clientele (with each
such brokerage house and/or clearing house being considered as one
holder).
The
Company has never paid a dividend on its common stock. It is the
Company’s present policy to retain all earnings to provide funds for the future
growth of the Company.
ITEM
5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS AND SMALL BUSINESS PURCHASES OF EQUITY SECURITIES -
continued
Recent
Sales of Unregistered Securities
On April
4, 2007, we issued 15,996,000 shares of common stock (as calculated to reflect
the 4 for 1 forward stock split effected on May 11, 2007), to various creditors
in exchange for the cancellation of $100,000 in debts we owed to such
creditors.
On April
9, 2007, we issued an aggregate of 32,000,004 shares of common stock (as
calculated to reflect the 4 for 1 forward stock split effected on May 11, 2007),
to three consultants in exchange for services provided. Between April
13, 2007, and April 15, 2007, we terminated and rescinded each of the consulting
agreements and the related stock grants.
On May 9,
2007, August 24, 2007, and August 31, 2007, we issued a
consultant convertible Debentures in the principle amounts of, CDN$200,000,
CDN$50,000 and CDN$200,000 respectively, each of which were convertible into
common stock at a conversion price of $1.50 per share. The Debentures
were issued as compensation for prior services provided by the
consultant. On March 31, 2008, the consultant converted all three
debentures into an aggregate on 287,666 shares of common stock.
On May
23, 2007, we issued 35,000,000 shares of common stock to one entity in exchange
for $1,000,000.
On May
29, 2007, we issued an aggregate of 44,600,000 shares of common stock to six
entities in exchange for prior consulting services provided to us by such
entities.
On July
23, 2007, we issued 20,000 shares of common stock to a non-U.S. person in
exchange for prior services provided to us.
On August
24, 2007, we issued 250,000 shares of common stock to an entity in exchange for
prior consulting services provided to us by such entity.
On
September 7, 2007, we issued a $150,000 convertible debenture, convertible into
shares of common stock at $1.00 per share. We issued the debenture
together with a warrant to purchase 150,000 shares of common stock exercisable
at $1.00 per share. On October 15, 2007, the debenture was fully
converted into 150,000 shares of common stock.
On
October 31, 2007, in exchange for a purchase price of $500,000, we issued one
entity 333,333 shares of common stock, along with a warrant to purchase 333,333
shares of common stock at an exercise price of $1.00 per share.
On
December 10, 2007, in exchange for a purchase price of $150,000, we issued
150,000 shares of common stock, along with a warrant to purchase 150,000 shares
of common stock at an exercise price of $1.00 per share.
The total
number of Common shares outstanding as at December 31, 2007 was
106,868,193.
All of
the securities listed above were issued to non-U.S. residents under an exemption
from registration provided by Rule 903 of Regulation S under the Securities Act
Rules. We made no directed selling efforts of these securities within
the United States. Each purchaser of the securities certified that
they were not U.S. persons, were not acquiring the securities for the account or
benefit of any U.S. person and would not resell the securities in the U.S. for
at least one year.
Issuer Purchases
Of Equity Securities
The
Company did not repurchase any shares during the fiscal year ended December 31,
2007.
ITEM
5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS AND SMALL BUSINESS PURCHASES OF EQUITY SECURITIES -
continued
Equity Compensation Plan
Information
As of the
end of the fiscal period ending December 31, 2007, we had no compensation plans
under which equity securities were authorized for issuance.
ITEM
6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION AND PLAN OF OPERATION
We intend
for this discussion to provide the reader with information that will assist in
understanding our financial statements, the changes in certain key items in
those financial statements from year to year, and the primary factors that
accounted for those changes, as well as how certain accounting principles affect
our financial statements. The discussion also provides information about the
financial results of the various segments of our business to provide a better
understanding of how those segments and their results affect the financial
condition and results of operations of the Company as a whole. To the
extent that our analysis contains statements that are not of a historical
nature, these statements are forward-looking statements, which involve risks and
uncertainties. See “Special Note Regarding Forward-Looking
Statements”. The following should be read in conjunction with our
Consolidated Financial Statements and the related Notes included elsewhere in
this filing.
Overview
My Screen
Mobile, Inc., a Delaware corporation, was incorporated in the State of Delaware
on January 10, 1996, under the name Nouveau Health Management,
Inc. On January 16, 1996, we entered into a Merger Agreement with
Health Management, Inc., a Florida corporation, in which Health Management, Inc.
was merged with and into us. In connection with our merger with
Health Management, Inc., we changed our name to Nouveau International,
Inc. On January 17, 1996, we entered into an Agreement and Plan of
Merger with Nouveau International, Inc., a Pennsylvania corporation, and Nouveau
Acquisition Corp., a Delaware corporation and our wholly owned subsidiary,
pursuant to which Nouveau Acquisition Corp. was merged with and into Nouveau
International, Inc., which became our wholly owned subsidiary. On
March 31, 1998, we ceased all of our operations and remained dormant until
September 27, 2006, when we filed a Certificate of Renewal of Charter with the
Delaware Secretary of State.
On April
4, 2007 we acquired the technology that forms the basis of our current business
from its inventors, and on April 19, 2007, we changed our name to My Screen
Mobile, Inc.
Our
technology is an application for direct incentive-based advertising to mobile
telephones that allows mobile subscribers to be compensated for viewing targeted
advertisements that is viewed on their mobile telephones or other mobile devices
in the form of images.
ITEM
6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION AND PLAN OF OPERATION - continued
Critical
Accounting Policies and Estimates
The
Company’s Management's Discussion and Analysis of Financial Condition and
Results of Operations section discusses the Company’s financial statements,
which have been prepared in accordance with accounting principles generally
accepted in the United States of America. The preparation of these financial
statements requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. On an on-going basis, management evaluates its estimates and
judgments, including those related to revenue recognition, accrued expenses,
financing operations, and
contingencies and litigation. Management
bases its estimates and judgments on historical experience and on various other
factors that are believed to be reasonable under the circumstances, the results
of which form the basis for making judgments about the carrying value of assets
and liabilities that are not readily apparent from other sources. Actual results
may differ from these estimates under different assumptions or conditions. These
accounting policies are described at relevant sections in this discussion and
analysis and in the notes to the financial statements included in the Company’s
Annual Report on Form 10-KSB for the years ended December 31, 2007 and December
31, 2006.
The
discussion and analysis set forth below covers the following comparative
periods: the calendar years ended December 31, 2007 and 2006.
Liquidity
and Capital Resources
The
Company had no cash as of December 31, 2006 or prior since the Company had been
dormant since 1996. In 2007 the Company purchased $130,181 in
Property & equipment and recorded $34,881 in Depreciation. Total assets,
including $244 in Cash at December 31, 2007 was $ 95,545. The Company had
$431,500 in debentures that were convertible into common shares, $149,373 in
advances due to a related party and $293,085 in accrued liabilities at December
31, 2007. The Accrued liabilities consist of accrued programming expenses of
$280,913, and accrued interest of $12,172. Total Liabilities as at December 31,
2007 was $873,958 The Company had $100,000 in accrued liabilities at December
31, 2006.
During
fiscal 2008, the Company issued 12,500,000 shares of its common stock along with
20,000,000 stock purchase warrants for $10,000,000 in cash. Management believes
that even with this financing, that without obtaining additional financing and
developing an ongoing source of revenue, the Company will not be able to
complete the development of its software and launch successfully. Although the
Company has actively been pursuing new business operations, the Company cannot
give assurance that the Company will succeed in this endeavor, or be able to
enter into necessary agreements to pursue its business on terms favorable to it.
Should the Company be unable to generate additional revenues or raise additional
capital, the Company could eventually be forced to cease business activities
altogether.
Results
of Operations for the Years Ended December 31, 2007 and 2006 and for the period
from inception (January 10, 1996) to December 31, 2007
Income
The
Company was dormant from 1996 through 2006. In 2007 the company
developed its software application and gathered interest from parties
to deploy our software. The Company had no income during the years ended
December 31, 2007 and 2006. For the period from the Company’s
inception on January 10, 1996 through December 31, 2007, the Company had net
sales of $563,382, less $516,031 for cost of goods sold, resulting in gross
profit of $47,351.
Expenses
The
Company had no expenses for the year ended December 31, 2006 because the Company
was dormant since 1996. During the year ended December 31, 2007, the Company
incurred $4,557,496 in expenses that were primarily related to Programming
$2,307,077 and Consulting $1,979,221. Programming payments were all
made to third party service providers and were expensed as incurred. Included in
Programming is $2,305,025in payments made to one of its shareholder’s company.
Consulting expense includes $1,187,554 relating to the fair value of warrants
issued to consultants for services provided.
ITEM 6. MANAGEMENT'S
DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION AND
PLAN OF OPERATION - continued
For the
period from the Company’s inception on January 10, 1996 through December 2007,
the Company had total expenses of $7,652,997, less gross profit of $47,351,
resulting in net operating losses of $7,605,646.
The
Company incurred $472,486 in Interest expense relating to its debt financing.
$460,315 of this expense was a result of the beneficial conversion included in
our convertible debenture agreements. We were required to fully amortize the
debt discount as the debenture was fully convertible on date of issuance per
EITF 98-5.Accrued interest on the debt totaled $12,172.
The
Impairment loss of $10,000 results from the full write off of the value ascribed
to the shares issued in return for the patents and trademarks assigned to the
Company. Due to the going concern noted by our auditors, the Company determined
the long term carrying value of the asset could not be supported and recorded
the Impairment loss.
The net
loss for 2007 was $5,039,982 and since inception, the net loss was
$8,088,132.
The
Company’s Plan of Operation for the Next Twelve Months
On
December 31, 2007 the Company had $244 in Cash and $873,958 in Current
Liabilities and was unable to satisfy either its short term or long term cash
requirements. The Company estimated it would need to raise at least an
additional $5,000,000 in capital in 2008 in order to continue developing its
business. The Company budgeted to invest an additional $2,000,000 in software
development. In 2008, the Company went through a very thorough request for
proposal process to identify a software development firm that could migrate our
systems to be accepted by mobile phone operators around the world. The Company
budgeted to hire approximately 10 full time staff at a cost of $1,100,000 and
budgeted to invest $250,000 in property and equipment during the year, The
Company also planned to attend a number of industry trade shows and budgeted
$250,000 for travel, entertainment and advertising.
The
Company is continuing to have discussions with a number of mobile phone carriers
and was pleased to announce Globalive Communications intent to launch mobile
advertising services in Canada using the MyScreen application. The
Company also spent a significant amount of time in 2008 identifying
advertising firms to partner with and announced a
partnership with Zimmerman Advertising to help build the MyScreen Brand
internationally.
As of the
date of this report, the Company is continuing to develop its business of
providing marketing and advertising tools for the mobile communications
industry. There is no guarantee that the Company will be able to
successfully develop its business or that it would generate sufficient revenues
to sustain its operations. The Company anticipates that additional
capital will likely have to come from licensing fees or from issuing additional
equity interests in 2009, which cannot occur without dramatically diluting the
existing equity ownership of the Company’s existing Common stockholders. The
Company is continuing its efforts to raise additional capital from both of these
sources.
Off-Balance
Sheet Arrangements
There are
no off balance sheet arrangements that have or are reasonably likely to have a
current or future effect on the Company’s financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that are material to
investors.
Working
Capital
Under the
Securities Purchase Agreement dated May 15, 2008, between the Company and
Orascom Telecom Holdings, S.A.E. the Company agreed to set aside $3,000,000 of
the $10,000,000 raised in a separate bank account pursuant to an Escrow
Agreement, which must be used by the Company to fund certain
technical expenditures.
ITEM 6. MANAGEMENT'S
DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION AND
PLAN OF OPERATION - continued
Contractual
Obligations and Other Commercial Commitments
The
following table sets forth information concerning our obligations and
commitments to make contractual
future payments, such as debt
agreements, purchase obligations and contingent commitments.
|
|
Payments Due During Fiscal Years Ending December
31,
|
|
|
Total
|
2008
|
2009-2010
|
2011-2012
|
Thereafter
|
|
Contractual
Obligations:
|
|
|
|
|
|
|
Convertible
debt obligations
|
431,500
|
|
|
|
|
|
Unrecorded
Contractual Obligations:
|
|
|
|
|
|
|
Purchase
obligations
|
NIL
|
|
|
|
|
Convertible
debentures mature four years from the date of issuance and all have the
following interest rate payment schedule: year 1 – 6%; year 2 – 8%;
year 3 – 10%; year 4 – 12%. Interest is paid yearly, in arrears. The convertible
debentures may be converted at any time in whole or in part, at the option of
the holders, into restricted common shares of the Company at conversion prices
ranging from $1.00 to $1.63. Subsequent to December 31, 2007, all debentures
were converted into common stock of the Company at their respective conversion
prices and as such, there are no future payments due.
Warrants
As of
December 15,2008, the Company has warrants outstanding to purchase an aggregate
of 25,434,697shares of common stock of the Company, 20,000,000 of which are
exercisable at $2.00 per share, and the balance of which are exercisable at
$1.00 per share. The warrants expire between October 2011 and May
2012. For the twelve months ended December 31, 2007, no warrants were
exercised.
Common
stock
On March
11, 2007, the Company’s Board of Directors approved a 1 for 100 stock reverse
split. Additionally, on May 11, 2007, the Company’s Board of Directors approved
a 4 for 1 forward stock split. On April 4, 2007, the Company issued 15,996,000
shares of common stock to various creditors for the $100,000 liability that was
accrued at December 31, 2006. On May 23, 2007, the Company issued
35,000,000 shares of its common stock for cash of $1,000,000. During the
year ended December 31, 2007, the Company issued 45,353,333 shares of its common
stock for services provided to the Company. The total number of Common shares
outstanding as at December 31, 2007 was 106,868,193.
Special
Note Regarding Forward-Looking Statements
The
Private Securities Litigation Reform Act of 1995 (the “Reform Act”) provides a
safe harbor for forward-looking statements made by or on behalf of the
Company. The Company and its representatives may, from time to time,
make written or verbal forward-looking statements, including statements
contained in the Company's filings with the Securities and Exchange Commission
and in its reports to stockholders. Generally, the inclusion of the
words "believe", "expect", "intend", "estimate", "anticipate", "will", and
similar expressions identify statements that constitute "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934 and that are intended to come
within the safe harbor protection provided by those sections.
ITEM 6. MANAGEMENT'S
DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION AND
PLAN OF OPERATION - continued
All
statements addressing operating performance, events, or developments that the
Company expects or anticipates will occur in the future, including statements
relating to sales growth, earnings or earnings per share growth, and market
share, as well as statements expressing optimism or pessimism about future
operating results (in particular, statements under Part II, Item 6, Management's
Discussion and Analysis of Financial Condition and Results of Operations),
contain forward-looking statements within the meaning of the Reform
Act. The forward-looking statements are and will be based upon
management's then-current views and assumptions regarding future events and
operating performance, and are applicable only as of the dates of such
statements but there can be no assurance that the statement of expectation or
belief will result or be achieved or accomplished. In addition, the
Company undertakes no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events, or
otherwise.
By their
nature, all forward-looking statements involve risk and
uncertainties. Actual results may differ materially from those
contemplated by the forward-looking statements for a number of reasons,
including but not limited: competitive prices pressures at both the wholesale
and retail levels, changes in market demand, changing interest rates, adverse
weather conditions that reduce sales at distributors, the risk of assembly and
manufacturing plant shutdowns due to storms or other factors, the impact of
marketing and cost-management programs, and general economic, financial and
business conditions.
Recent
Accounting Pronouncements
The
Company does not expect the adoption of any recent accounting pronouncements to
have a material effect on its financial statements.
ITEM
7. FINANCIAL STATEMENTS
The
Financial Statements are included with this report commencing on
page
F-1.
ITEM
8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM
8A. CONTROLS AND PROCEDURES
Evaluation of Disclosure
Controls and Procedures
In
connection with the preparation of this annual report on Form 10-KSB, an
evaluation was carried out by our management, with the participation of the
Chief Executive Officer and Chief Financial Officer, of the effectiveness of our
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934 ("Exchange Act")) as of December 31,
2007. Disclosure controls and procedures are designed to ensure that information
required to be disclosed in reports filed or submitted under the Exchange Act is
recorded, processed, summarized, and reported within the time periods specified
in the SEC rules and forms and that such information is accumulated and
communicated to management, including the Chief Executive Officer and the Chief
Financial Officer, to allow timely decisions regarding required
disclosures.
Based on
that evaluation, our management concluded, as of the end of the period covered
by this report, that our disclosure controls and procedures were not effective
in recording, processing, summarizing, and reporting information required to be
disclosed, within the time periods specified in the SEC's rules and
forms.
ITEM
8A. CONTROLS AND PROCEDURES - continued
Management's Report on
Internal Control Over Financial Reporting
Management
of our company is responsible for establishing and maintaining adequate internal
control over financial reporting. Our company's internal control over financial
reporting is a process, under the supervision
of the Chief Executive
Officer and the Chief Financial Officer, designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of the Company's financial statements for external purposes in accordance with
United States generally accepted accounting principles. Internal control over
financial reporting includes those policies and procedures
that:
|
•
|
Pertain
to the maintenance of records that in reasonable detail accurately and
fairly reflect the transactions and dispositions of the Company's
assets;
|
|
•
|
Provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of the financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures are
being made only in accordance with authorizations of management and the
Board of Directors; and
|
|
•
|
Provide
reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use, or disposition of the Company's assets that
could have a material effect on the financial
statements.
|
Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions or that the degree of compliance
with the policies or procedures may deteriorate.
Our
management conducted an assessment of the effectiveness of the Company's
internal control over financial reporting as of December 31, 2007, based on
criteria established in Internal Control - Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission
("COSO").
Management
was made aware of certain errors in the Company’s consolidated financial
statements. Such errors are deemed by management to have occurred due to
material weaknesses in the Company’s controls and procedures. Accordingly, based
on our assessment we have concluded that, as of December 31, 2007, the
Company’s internal control over financial reporting were not effective based on
those criteria outlined under the Securities Exchange Act. The Company’s
President and Chief Financial Officer, the (“Certifying Officers”) have
evaluated the effectiveness of the Company’s disclosure controls and the
timeliness of its regulatory filings and believe that the Company’s
disclosure controls and procedures were not effective based on the required
evaluation as of the date of this Report. As stated previously, the Company was
dormant from 1996 until April 2007. The Company will take steps to remediate
these material weaknesses, including either engaging an outside consulting firm
or hiring qualified staff with the requisite expertise to assist with certain
complex accounting of the Company’s convertible securities and to ensure more
timely reporting.
There
have been no significant changes in internal controls or in other factors that
could significantly affect internal controls subsequent to the date of their
evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses with the exception of the need for
obtaining and implementing controls around complex accounting
transactions.
This
annual report does not include an attestation report of our independent
registered public accounting firm regarding internal control over financial
reporting. We were not required to have, nor have we, engaged our independent
registered public accounting firm to perform an audit of internal control over
financial reporting pursuant to the rules of the Securities and Exchange
Commission that permit us to provide only management's report in this annual
report.
ITEM
8B. OTHER INFORMATION
None.
PART
III.
ITEM
9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSONS AND
CORPORATE GOVERNANCE; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE
ACT
Directors
and Executive Officers
Our
directors, executive officers and key employees are as follows:
|
Name
|
Age
|
Position
|
Current Position
Held
Since
|
|
|
|
|
|
|
Terrence
Rodrigues
|
53
|
Director,
President, Chief Executive Officer & Secretary
|
2007
|
|
Raghunath
Kilambi
|
43
|
Director,
Chief Financial Officer
|
2008
|
|
James
Bailey
|
43
|
Director
|
2008
|
|
Gino
Porco
|
41
|
Chairman,
Advisory Board
|
2008
|
Terrence Rodrigues
, has served
as our President, Treasurer and Director since April
2007. Previously, Mr. Rodrigues gained extensive expertise in real
estate financing and management with companies such as Lehndorff Property
Management and Royal Le Page. Mr. Rodrigues served as controller, treasurer and
held a variety of financial positions within Lehndorff and Royal Le Page. While
at Lehndorff, Mr. Rodrigues helped start a financial services Company,
Chancellor Trust. While at Royal Le Page Mr. Rodrigues was the
controller/accounting manager, managing assets in excess of $200
million.
Leaving
Royal Le Page in 2001 Mr. Rodrigues started his own consulting/ accounting
business. Mr. Rodrigues was previously a director of PSiGate Merchant
Services and Products (2004-2007), a publicly traded Canadian venture company,
and American Associates Group Inc. (2005-2007) an OTC Pink Sheet
Company.
Mr.
Rodrigues received his Bachelor of Commerce degree from the University of
Toronto, thereafter articling at Clarkson Gordon (later known as Ernest and
Young) he became a Chartered Accountant.
Raghunath Kilambi
is currently
serving as our Chief Financial Officer and as a Director, positions he has held
since June 2008.
Between
May 2003 and March 2008, Mr. Kilambi served as Chief Executive Officer, and a
Director of Swiss Medica, Inc. Previously, Mr. Kilambi served as a
general partner of merchant banking firm focused on technology and health care
between 2001 and 2003.
Between
1998 and 2000, Mr. Kilambi was CFO and Director of a California- based
application service provider that had a peak Nasdaq market capitalization of $2
billion. In addition, Mr. Kilambi was the principal of a technology investment
banking group from 1993 to 1998 and worked in senior financial roles at a
consumer food company from 1990 to 1993. Mr. Kilambi began his career with
Touche Ross & Co. (now Deloitte and Touche) and holds the Canadian Chartered
Accountant professional designation. Mr. Kilambi
earned a Bachelor of Commerce in Finance and Accounting
and a Graduate Diploma in Public Accounting from McGill University in Montreal,
Canada.
ITEM
9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSONS AND
CORPORATE GOVERNANCE; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT -
continued
James
Bailey
is
currently serving as a Director, a position he has held since June
2008.
Mr. Bailey has 15 years of experience in
telecommunications, media and technology, most of this gained internationally in
the United Kingdom, Europe, the Middle East and Africa. He began his career with
a global satellite provider before moving into fixed line telecommunications and
cable television. He spent two years as Director of Mergers and Acquisitions
with an Application Service Provider in Canada before moving to Europe in 2002
where he was the Chief Financial Officer of Telecel International, a subsidiary
of Orascom Telecom Holdings SAE, an international mobile operator working in GSM
and WiMAX.
Mr.
Bailey returned to Canada in July 2007 where he is currently President of a
private consulting company providing advice in financial and strategic planning,
M&A and fund-raising to companies in a range of sectors including
TMT.
Gino
Porco
is
currently serving as our Chairman of our Advisory Board, a position he has held
since April 2008
. Mr. Porco has overseen the development of the company's
technology initiatives from planning stage through development and performance
testing. Mr. Porco has supervised multiple development teams working on both
network development and infrastructure and device applications and technologies,
driving the various core offerings of the company. Since 2002, Mr.
Porco has been President of Envenia Networks, which designs and implements
best-of-breed, carrier-class voice networking solutions. Mr. Porco
has consulted on various telecommunication projects, lending expertise to the
development of Sky Voice, Digital World, Power Telephone, Carrier and Compu-call
communication, as well as various internet projects since its rise to prominence
in the late 1990’s.
Directors’
Remuneration
During
2007, the Company did not pay any remuneration to its directors for serving on
our Board of Directors.
Audit
Committee
Our Audit
Committee was established in November 2008, and therefore, did not hold any
meetings during fiscal year 2007. On a going forward basis, our Audit
Committee will recommend the selection of independent public
accountants, review the scope of approach to audit work, meet with and review
the activities of the Company's internal accountants and the
independent public accountants, make recommendations to management or to the
Board of Directors as to any changes to such practices and procedures deemed
necessary from time to time to comply with applicable auditing rules,
regulations and practices, and review all Form 10-KSB Annual and 10-QSB interim
reports.
The Audit
Committee currently consists of James Bailey and is an "Audit Committee" for the
purposes of Section 3(a)(58) of the Securities Exchange Act of 1934. The Audit
Committee has one "audit committee financial expert" as defined by Item 401(e)
of Regulation S-B under the Securities Exchange Act of 1934, James Bailey, is
"independent" as that term is defined in the rules of the NASDAQ stock
market. In addition, our board of directors has determined that James
Bailey is financially sophisticated as defined by the SEC rules and our audit
committee charter. Mr. Bailey has extensive experience reading,
analyzing, and preparing GAAP financial statements and SEC reports and
filings.
Code
of Ethics and Standards of Conduct
The
Company has adopted a code of business conduct and ethics applicable to the
Company’s directors, officers, and employees (including our principal executive
officers, principal financial officer and principal accounting
officer). The Code of Ethics and Standards of Conduct is available on
our website and may be found at www.myscreen.com and has been filed as an
exhibit to this Form 10-KSB. In the event that we amend or waive any
of the provisions of the Code of Ethics and Standards of Conduct applicable to
our principal executive officer, principal financial officer, or principal
accounting officer, we intend to disclose the same on the Company website and
will disclose the same by filing a Form 8-K with the Securities and Exchange
Commission.
ITEM
9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSONS AND
CORPORATE GOVERNANCE; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT -
continued
Section
16(a) Beneficial Ownership Reporting Compliance
We are
aware of the following individual directors, officers or beneficial owners of
more than ten percent of the Company’s Common Stock that, during the fiscal year
2007 or for the fiscal year 2007, failed to file on a timely basis reports
required by Section 16(a) of the Securities Exchange Act of 1934.
On April
4, 2007, we entered into an Asset Purchase Agreement with Gino Porco, pursuant
to which we acquired our current technology, and agreed to issue Mr. Porco
10,000,000 shares of our common stock, which at the time constituted, and
currently constitutes, more than 5% of our outstanding common
stock. The shares were valued at $0.001 per share, for a transaction
value of $10,000. On May 29, 2007, we issued 9,312,500 shares of
common stock to each of Vroom Vroom Group, Inc., and PAP Capital, Inc., in
exchange for consulting services. The shares were valued at $0.001
per share, and therefore, each of those transactions had a value of $9,312.50.
Gino Porco was and is the sole shareholder, officer and director of both PAP
Capital, Inc., and Vroom Vroom Group, Inc., and is therefore, deemed to
beneficially own all shares held of record by both of those entities. Gino
Porco, Vroom Vroom Group, Inc., PAP Capital, Inc. did not file a Form 3
reporting such issuance or a Form 5 following the close of our fiscal year
end.
On May
23, 2007, Trans Stahl Ltd. was issued 35,000,000 shares of our common stock,
which, at the time of issuance constituted, and currently constitutes, over 10%
of our common stock. Trans Stahl Ltd. did not file a Form 3 reporting
such issuance or a Form 5 following the close of our fiscal year
end.
On May
29, 2007, NAC Investments, Inc. was issued 18,625,000 shares of our common
stock, which, at the time of issuance constituted, and currently constitutes,
over 10% of our common stock. NAC Investments, Inc. did not file a
Form 3 reporting such issuance or a Form 5 following the close of our fiscal
year end.
ITEM
10. EXECUTIVE COMPENSATION
Summary
Compensation Table
We were
dormant during the fiscal years ended December 31, 2006 and 2005, and did not
pay any compensation to any named officers or directors in
2007.
In April
2007 we issued Terrence Rodrigues, who was our sole director and officer,
10,004,000 shares of common stock (as calculated on a post 4 for 1 forward stock
split ), in exchange for services to be provided under a Consulting
Agreement. We, however, mutually terminated and rescinded the
Consulting Agreement on April 13, 2007, and cancelled the share
issuance.
Stock
Option Grants in the past fiscal year
We did
not grant any stock options in the past fiscal year.
Employment
Agreements
We had no
employment agreements with any officers or other employees that were effective
prior to December 31, 2007.
ITEM
11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDERS MATTERS
The
following table sets forth information regarding beneficial ownership of our
common stock as of December 1, 2008, by (i) those shareholders known to be the
beneficial owners of more than five percent of the voting power of our
outstanding capital stock, (ii) each named executive officer and/or director,
and (iii) all executive officers and directors as a group:
|
Name
and Address of
Beneficial Owner
|
|
Amount
and Nature of Beneficial
Ownership
|
|
|
Percent
Owned
|
|
|
Principal
Stockholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trans
Stahl Ltd
71
Vasileos Georgiou Street803 Le Bois Apts., PolamosYermasoyas, Limassol
Cyprus
|
|
|
35,100,000
|
|
|
|
26.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
NAC
Investments Inc.
28
Cedarbant Cr.
Don
Mills, ON, M3B 3A4
Canada
|
|
|
18,625,000
|
|
|
|
14.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
PAP
Capital, Inc. (1)
81
Chartwell Rd.
Toronto,ON.
M8Z 4G8
Canada
|
|
|
9,312,500
|
|
|
|
7.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Vroom
Vroom Group, Inc.(1)
81
Chartwell Rd.
Toronto,ON.
M8Z 4G8
Canada
|
|
|
9,312,500
|
|
|
|
7.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Gino
Porco (1)(3)
81
Chartwell Rd.
Toronto,ON.
M8Z 4G8
Canada
|
|
|
32,941,667
|
|
|
|
25.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Orascom
Telecom Holdings, S.A.E. (2)
2005A
Nile City Towers
South
Tower, Cornish El Nile
Ramlet
Beaulac, Cairo
Egypt
11221
|
|
|
32,500,000
|
|
|
|
21.4
|
%
|
|
|
|
|
|
|
|
|
|
|
ITEM
11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDERS MATTERS - continued
|
Name
and Address of
Beneficial Owner
|
|
|
Amount
and Nature of Beneficial
Ownership
|
|
|
|
Percent
Owned
|
|
|
Named
Executive Officers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Terrence
Rodrigues (4)
c/o
My Screen Mobile, Inc.
70
Yorkville Avenue, Suite 30
Toronto,
Ontario, Canada, M5R 1B9
|
|
|
83,333
|
|
|
|
0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
James
Wicks
c/o
My Screen Mobile, Inc.
70
Yorkville Avenue, Suite 300
Toronto,
Ontario, Canada, M5R 1B9
|
|
|
0
|
|
|
|
0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
c/o
My Screen Mobile, Inc.
70
Yorkville Avenue, Suite 300
Toronto,
Ontario, Canada, M5R 1B9
|
|
|
166,667
|
|
|
|
0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Directors
|
|
|
|
|
|
|
|
|
|
|
|
|
83,333
|
|
|
|
0
|
%
|
|
c/o
My Screen Mobile, Inc.
70
Yorkville Avenue, Suite 30
Toronto,
Ontario, Canada, M5R 1B9
|
|
|
166,667
|
|
|
|
0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
c/o
My Screen Mobile, Inc.
70
Yorkville Avenue, Suite 30
Toronto,
Ontario, Canada, M5R 1B9
|
|
|
|
|
|
|
|
|
|
|
|
|
83,333
|
|
|
|
0
|
%
|
|
c/o
My Screen Mobile, Inc.
70
Yorkville Avenue, Suite 30
Toronto,
Ontario, Canada, M5R 1B9
|
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
|
|
0
|
%
|
|
c/o
My Screen Mobile, Inc.
70
Yorkville Avenue, Suite 30
Toronto,
Ontario, Canada, M5R 1B9
|
|
|
|
|
|
|
|
|
|
All
Directors and Officers as a Group (6) (4 Persons)
|
|
|
333,333
|
|
|
|
0.25
|
%
|
(1) Mr.
Porco is the sole shareholder, officer and director of PAP Capital, Inc., and is
therefore, deemed to beneficially own 9,312,500 shares held of record by PAP
Capital, Inc. In addition, Mr. Porco is the sole shareholder,
officer and director of Vroom Vroom Group, Inc., and is therefore, deemed to
beneficially own 9,312,500 shares held of record by Vroom Vroom Group,
Inc. He is also the sole shareholder, officer and director of LBS
Ventures, Inc., and is therefore, deemed to beneficially own 4,000,000 shares
held of record by LBS Ventures, Inc. Mr. Porco
disclaims beneficial ownership of these shares except to the extent of his
pecuniary interest.
(2) Includes
12,500,000 shares of common stock, and a warrant to purchase 20,000,000 shares
of common stock for an exercise price of $2.00 per share, which is exercisable
within 60 days of the date of this filing.
(3) Includes
options to purchase 166,667 shares of common stock which are exercisable within
60 days of the date of this filing, which options were granted to Mr. Porco on
December 4, 2008.
ITEM
11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDERS MATTERS - continued
(4) All
represent options to purchase shares of common stock which are exercisable
within 60 days of the date of this filing, which options were granted on
December 4, 2008.
(5) Includes
options to purchase 166,667 shares of common stock which are exercisable within
60 days of the date of this filing, which options were granted to Mr. Kilambi on
December 4, 2008.
(6) Includes
options to purchase 333,333 shares of common stock which are exercisable within
60 days of the date of this filing, which options were granted on December 4,
2008
ITEM
12. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
In April
2007 we issued Terrence Rodrigues, who was our sole director and officer,
2,501,000 shares of common stock in exchange for services to be provided under a
Consulting Agreement. We, however, mutually terminated and rescinded
the Consulting Agreement on April 13, 2007, and cancelled the share
issuance. During the period January 1, 2008 and December 15, 2008 Mr.
Rodrigues was paid $11,466 in his capacity as a Director.
On May
27, 2008, we entered into an Exclusive Territory Agreement with Orascom Telecom
Holdings, S.A.E. and Weather Investments, S.P.A., under which we granted
Orascom, Weather and their subsidiaries, the exclusive right to promote and
deliver our services within Algeria, Bangledesh, Canada, Egypt, Greece, Italy,
North Korea, Pakistan, Tunisia and Zimbabwe. We have the right to
terminate the exclusivity with respect to Bangladesh, Canada, North Korea,
Tunisia or Zimbabwe, if Orascom does not launch our service within such country
by certain mutually agreed upon dates. In addition, if after the
effective date of the Agreement, Orascom, Weather or any of their subsidiaries
launches telecommunications service in a new country, Orascom, Weather and such
subsidiaries, shall have the option to be the exclusive provider of our service
in such country, subject to any rights related to the provision of our services
in such countries, which we grant prior to the exercise of the
option. We entered into the Exclusive Territory Agreement as a
condition to the Securities Purchase Agreement dated May 15, 2008, between us
and Weather Investments, S.P.A., pursuant to which in exchange for $10,000,000,
we sold Weather Investments, S.P.A., 12,500,000 shares of common stock along
with a Warrant to purchase 20,000,000 shares of our common stock which at the
time constituted 10% of our outstanding common stock. The Company had no prior
business dealings with Weather or Orascom prior to May 15, 2008.
On April
4, 2007, we entered into an Asset Purchase Agreement with Gino Porco, pursuant
to which we acquired our current technology, and agreed to issue Mr. Porco
10,000,000 shares of our common stock, which at the time constituted, and
currently constitutes, more than 5% of our outstanding common
stock. The shares were valued at $0.001 per share, for a transaction
value of $10,000. . On or about April 4, 2007, and in connection with
entering into the Asset Purchase Agreement with Mr. Porco, we entered into a
Development Agreement with Envenia Networks, Inc., pursuant to which Envenia
Networks, Inc., agreed to provide development services related to the technology
we acquired from Mr. Porco. Under the terms of the Development
Agreement, we paid Envenia, CAN$3,197,755.00, between April 2007 and May
2008. Mr. Porco was and is the sole shareholder, officer and director
of Envenia Networks, Inc., and is therefore, deemed to beneficially own all
shares held of record held by that entity.
On May
29, 2007, we issued 9,312,500 shares of common stock to each of Vroom Vroom
Group, Inc., and PAP Capital, Inc., in exchange for consulting
services. The shares were valued at $0.001 per share, and therefore,
each of those transactions had a value of $9,312.50. Gino Porco
the holder of over 5% of our outstanding common stock, was and is the sole
shareholder, officer and director of both PAP Capital, Inc., and Vroom Vroom
Group, Inc., and is therefore, deemed to beneficially own all shares held of
record by both of those entities.
ITEM 11. SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERS MATTERS -
continued
On
January 1, 2008, we entered into an Employment Agreement with Gino Porco, the
holder of over 5% of our outstanding common stock, pursuant to which Mr. Porco
serves as Chairman of our Advisory Board. The Employment Agreement
has an initial term of two years, and automatically renews for additional
successive one year terms, unless either party provides the other with notice of
termination sixty days prior to the end of the initial term or the applicable
renewal term. We agreed to compensate Mr. Porco through the issuance
of 25,000 shares of our common stock each month. On or about June 13,
2008, we issued Mr. Porco 150,000 shares of common stock as compensation for
January 2008 through June 2008. The shares were valued at $ 1.367 per
share, for an aggregate value of $ 205,050.
On July
1, 2008, we executed an Amendment to the Employment Agreement which changed the
compensation from the issuance to Mr. Porco of 25,000 shares per month, to the
payment to Mr. Porco of $25,000 per month, and have been paying Mr. Porco
$25,000 per month since such date.
On
November 10, 2008, we entered into an Asset Purchase Agreement with LBS
Ventures, Inc., pursuant to which we acquired certain technology related to our
mobile advertising technology, in exchange for 4,000,000 shares of common
stock. The shares were valued at $1.01per share, and therefore, this
transaction had a value of $4,040,000. Mr. Porco was and is the sole
shareholder, officer and director of LBS Ventures, Inc., and is therefore,
deemed to beneficially own all shares held of record held by that
entity.
On June
11, 2008, we issued Trans Stahl Ltd., 100,000 shares of common stock in exchange
for consulting services. The shares were valued at $1.95 per share,
and therefore, this transaction had a value of $195,000. At the time
of issuance Trans Stahl Ltd., was the owner of more than 5% of our outstanding
common stock.
On May
28, 2008, the Company paid each of Raghunath Kilambi and James Bailey a due
diligence fee of $50,000 as compensation for services they performed in
connection with the closing of the $10,000,000 stock purchase transaction we
entered into with Orascom Telecom Holdings, S.A.E. and Weather Investments,
S.P.A. Messrs. Kilambi and Bailey have served as directors since June
1, 2008
During
the period July 1, 2008 to December 15, 2008 Mr. Raghunath Kilambi, a director
and our Chief Financial Officer, was paid $120,000 in his capacity as Chief
Financial Officer, In addition Mr. Kilambi was paid $13,500 for consulting
services provided to the company in June 2008.
During
the period July 1, 2008 to December 15, 2008 Mr. James Bailey, a director was
paid $25,000 in his capacity as a director.
On
December 4, 2008, our Board approved the issuance to Messrs. Bailey and
Rodriguez, two of our directors, of options to purchase 500,000 shares of common
stock. On December 4, 2008, our Board also approved the issuance to
each of Mr. Raghunath Kilambi, a director, and Gino Porco, the holder of more
than 5% of our outstanding common stock, of options to purchase 1,000,000 shares
of common stock. All of the options approved on December 4, 2008,
have an exercise price of $1.00 per share, which was the closing trading price
of the common stock on that date, and vest in 6 equal semiannual installments,
with the first installment vesting on December 31, 2008.
MYSCREEN
MOBILE, INC.(FORMERLY NOUVEAU INTERNATIONAL, INC.)
(A
DEVELOPMENT STAGE COMPANY)
FINANCIAL
STATEMENTS
TABLE
OF CONTENTS
|
|
Page
|
|
Report
of Independent Registered Accounting Firm
|
F-1
|
|
|
|
|
Balance
Sheets for Periods Ended December 31, 2007 and 2006
|
F-2
|
|
|
|
|
Statement
of Operations for the Periods Ended December 31, 2007 and 2006 and for the
Period from Inception (January 10, 1996) to December 31, 2007
(Unaudited from January 10, 1996 to December 31, 2004)
|
F-3
|
|
|
|
|
Statement
of Stockholders' Equity for the Period from Inception (January 10, 1996)
to December 31, 2007 (Unaudited from January 10, 1996 through December 31,
2004)
|
F-4
|
|
|
|
|
Statement
of Cash Flows for the Periods Ended December 31, 2007 and 2006 and for the
Period from Inception (January 10, 1996) to December 31, 2007
(Unaudited from January 10, 1996 to December 31, 2004)
|
F-5
|
|
|
|
|
Notes
to Financial Statements
|
F-6
|
Madsen
& Associates CPA's, Inc.
684 EAST
VINE STREET #3
MURRAY,
UTAH 84107
TELEPHONE
(801) 268-2632
FAX (801)
262-3978
|
TED A. MADSEN,
CPA
|
MEMBER:AMERICAN
INSTITUTE OF
CERTIFIED PUBLIC
ACCOUNTANTS
UTAH ASSOCIATION
OF
CERTIFIED PUBLIC
ACCOUNTANTS
|
REPORT OF INDEPENDENT REGISTERED
PUBLIC
ACCOUNTING FIRM
To the
Board of Directors and
Stockholders
of My Screen Mobile, Inc. (a development stage company)
(formerly
Nouveau International Inc.)
We have
audited the accompanying balance sheets of My Screen Mobile, Inc. (a development
stage company) (formerly Nouveau International Inc.) (the Company) as of
December 31, 2007 and 2006, and the related statements of operations,
stockholders' deficit, and cash flows for the years ended December 31, 2007 and
2006 and for the period from inception (January 10, 1996) to December 31, 2007.
My Screen Mobile, Inc.'s management is responsible for these financial
statements. Our responsibility is to express an opinion on these financial
statements based on our audits.
We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of My Screen Mobile, Inc. as of
December 31, 2007 and 2006, and the results of its operations and its cash flows
for the years ended December 31, 2007 and 2006 and for the period from inception
(January 10, 1996) to December 31, 2007 in conformity with accounting principles
generally accepted in the United States of America.
The
accompanying financial statements have been prepared assuming the Company will
continue as a going concern. As discussed in Note 3 to the financial statements,
the Company has incurred accumulated losses of $8,088,132 since inception, has
not attained profitable operations, and is dependent upon obtaining adequate
financing to fulfill its planned activities. These factors raise substantial
doubt that the Company will be able to continue as a going concern. Management's
plans in regard to these matters are also discussed in Note 3 to the financial
statements. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/s/Madsen
& Associates CPA's, Inc.
Madsen & Associates CPA's, Inc.
Salt Lake
City, UT
October
21, 2008
|
MY
SCREEN MOBILE, INC.
|
|
(FORMERLY
NOUVEAU INTERNATIONAL INC.)
|
|
(A
DEVELOPMENT STAGE COMPANY)
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
DECEMBER
31, 2007 and 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
December 31
|
|
|
December 31
|
|
|
|
|
2007
|
|
|
2006
|
|
|
|
|
$
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
|
|
|
|
|
Cash
|
|
|
244
|
|
|
|
-
|
|
|
Prepaid
rent
|
|
|
-
|
|
|
|
-
|
|
|
Other
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
244
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
and equipment (net)
|
|
|
95,301
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
|
95,545
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS' DEFICIT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
|
|
|
|
Bank
indebtedness
|
|
|
-
|
|
|
|
-
|
|
|
Convertible
debenture payable
|
|
|
431,500
|
|
|
|
-
|
|
|
Convertible
promissory note payable
|
|
|
-
|
|
|
|
-
|
|
|
Advances
from related party
|
|
|
149,373
|
|
|
|
|
|
|
Accrued
liabilities
|
|
|
293,085
|
|
|
|
100,000
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
CURRENT LIABILITIES
|
|
|
873,958
|
|
|
|
100,000
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES
|
|
|
873,958
|
|
|
|
100,000
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS'
DEFICIT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock: $.001 par value;
|
|
|
|
|
|
|
|
|
|
200,000,000
shares authorized;
|
|
|
|
|
|
|
|
|
|
106,868,193
shares issued and outstanding
|
|
|
106,868
|
|
|
|
369
|
|
|
Additional
paid-in capital
|
|
|
7,202,851
|
|
|
|
2,947,781
|
|
|
Deficit
accumulated during development stage
|
|
|
(8,088,132
|
)
|
|
|
(3,048,150
|
)
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
STOCKHOLDERS' DEFICIT
|
|
|
(778,413
|
)
|
|
|
(100,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS' DEFICIT
|
|
|
95,545
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED
FINANCIAL STATEMENTS)
|
|
|
|
|
|
|
|
|
|
|
|
MY
SCREEN MOBILE, INC.
|
|
(FORMERLY
NOUVEAU INTERNATIONAL INC.)
|
|
(A
DEVELOPMENT STAGE COMPANY)
|
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
Ended
|
|
|
Year
Ended
|
|
|
January
10, 1996 (INCEPTION)
|
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
To
December 31,
|
|
|
|
|
2007
|
|
|
2006
|
|
|
2007
|
|
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
sales
|
|
|
-
|
|
|
|
-
|
|
|
|
563,382
|
|
|
Cost
of goods sold
|
|
|
-
|
|
|
|
-
|
|
|
|
516,031
|
|
|
Gross
Profit
|
|
|
-
|
|
|
|
-
|
|
|
|
47,351
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EXPENSES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consulting
|
|
|
1,979,221
|
|
|
|
-
|
|
|
|
1,979,221
|
|
|
Programming
|
|
|
2,307,077
|
|
|
|
-
|
|
|
|
2,307,077
|
|
|
Advertising
and promotion
|
|
|
53,135
|
|
|
|
-
|
|
|
|
53,135
|
|
|
Selling,
general and administrative
|
|
|
89,504
|
|
|
|
-
|
|
|
|
3,089,626
|
|
|
Depreciation
|
|
|
34,881
|
|
|
|
|
|
|
|
130,260
|
|
|
Travel
and entertainment
|
|
|
27,914
|
|
|
|
|
|
|
|
27,914
|
|
|
Legal
and audit
|
|
|
64,970
|
|
|
|
-
|
|
|
|
64,970
|
|
|
Bank
charges
|
|
|
794
|
|
|
|
-
|
|
|
|
794
|
|
|
Total
Operating Expense
|
|
|
4,557,496
|
|
|
|
-
|
|
|
|
7,652,997
|
|
|
OPERATING
(LOSS)
|
|
|
(4,557,496
|
)
|
|
|
-
|
|
|
|
(7,605,646
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
INCOME (EXPENSE):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
(472,486
|
)
|
|
|
|
|
|
|
(472,486
|
)
|
|
Impairment
loss on intellectual property intangible asset
|
|
|
(10,000
|
)
|
|
|
|
|
|
|
(10,000
|
)
|
|
Total
other expense
|
|
|
(482,486
|
)
|
|
|
-
|
|
|
|
(482,486
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)
before income taxes
|
|
|
(5,039,982
|
)
|
|
|
-
|
|
|
|
(8,088,132
|
)
|
|
Provision
for income taxes
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(loss)
|
|
|
(5,039,982
|
)
|
|
|
-
|
|
|
|
(8,088,132
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
LOSS PER COMMON SHARE -
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
BASIC AND DILUTED
|
|
|
(0.05
|
)
|
|
|
0.00
|
|
|
|
|
|
|
-
DILUTED
|
|
|
(0.05
|
)
|
|
|
0.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED
AVERAGE NUMBER OF
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMON
SHARES OUTSTANDING
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
BASIC
|
|
|
106,325,088
|
|
|
|
368,860
|
|
|
|
|
|
|
-
FULLY DILUTED
|
|
|
107,299,038
|
|
|
|
368,860
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED
FINANCIAL STATEMENTS)
|
|
MY
SCREEN MOBILE, INC.
|
|
(FORMERLY
NOUVEAU INTERNATIONAL INC.)
|
|
(A
DEVELOPMENT STAGE COMPANY)
|
|
CONSOLIDATED
STATEMENT OF STOCKHOLDERS' EQUITY
|
|
FOR
THE PERIOD FROM JANUARY 10, 1996 (INCEPTION) TO DECEMBER 31,
2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
Deficit
Accumulated
|
|
|
Total
|
|
|
|
|
Common
Stock
|
|
|
Paid
in
|
|
|
During
|
|
|
Stockholders'
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Development
Stage
|
|
|
Deficit
|
|
|
Balance
January 12, 1996
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Date
of Inception)
|
|
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
Issuance
of common stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
from
inception (Jan. 10, 1996) to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 1996
|
|
|
368,860
|
|
|
|
369
|
|
|
|
2,947,781
|
|
|
|
|
|
|
|
2,948,150
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 1996
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(3,048,150
|
)
|
|
|
(3,048,150
|
)
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 1997
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
December
31, 1998
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
December
31, 1999
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 2000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 2001
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
December
31, 2002
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 2003
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 2004
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
December
31, 2005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
December
31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
for 100 reverse stock split
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March
11, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of common stock for
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$100,000
liability April 4, 2007
|
|
|
15,996,000
|
|
|
|
15,996
|
|
|
|
84,004
|
|
|
|
|
|
|
|
100,000
|
|
|
Issuance
of common stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
for
intellectual property April 4,2007
|
|
|
10,000,000
|
|
|
|
10,000
|
|
|
|
-
|
|
|
|
|
|
|
|
10,000
|
|
|
4
for 1 forward stock split
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
May
11, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of common stock for cash;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
May
23, 2007
|
|
|
35,000,000
|
|
|
|
35,000
|
|
|
|
965,000
|
|
|
|
|
|
|
|
1,000,000
|
|
|
Issuance
of common stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
for
services May 29,2007
|
|
|
44,600,000
|
|
|
|
44,600
|
|
|
|
-
|
|
|
|
|
|
|
|
44,600
|
|
|
Issuance
of common stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
for
legal services July 23
|
|
|
20,000
|
|
|
|
20
|
|
|
|
56,580
|
|
|
|
|
|
|
|
56,600
|
|
|
Issuance
of common stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
for
management and financial
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
services
August 24
|
|
|
250,000
|
|
|
|
250
|
|
|
|
702,250
|
|
|
|
|
|
|
|
702,500
|
|
|
Debenture
converted at $1 per
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
common
share; October 15, 2007
|
|
|
150,000
|
|
|
|
150
|
|
|
|
149,850
|
|
|
|
|
|
|
|
150,000
|
|
|
Issuance
of common stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
for
services; October 31, 2007
|
|
|
333,333
|
|
|
|
333
|
|
|
|
499,667
|
|
|
|
|
|
|
|
500,000
|
|
|
Issuance
of common stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
for
services; December 10, 2007
|
|
|
150,000
|
|
|
|
150
|
|
|
|
149,850
|
|
|
|
|
|
|
|
150,000
|
|
|
Beneficial
conversion features from
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
issuance
of convertible debentures
|
|
|
|
|
|
|
|
|
|
|
460,315
|
|
|
|
|
|
|
|
460,315
|
|
|
Stock
Warrants issued for
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
consulting
services
|
|
|
|
|
|
|
|
|
|
|
1,187,554
|
|
|
|
|
|
|
|
1,187,554
|
|
|
Net
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5,039,982
|
)
|
|
|
(5,039,982
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
December 31, 2007
|
|
|
106,868,193
|
|
|
$
|
106,868
|
|
|
$
|
7,202,851
|
|
|
$
|
(8,088,132
|
)
|
|
$
|
(778,413
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(THE
ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL
STATEMENTS)
|
|
MY
SCREEN MOBILE, INC.
|
|
|
(FORMERLY
NOUVEAU INTERNATIONAL INC.)
|
|
|
(A
DEVELOPMENT STAGE COMPANY)
|
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FOR
THE PERIOD FROM
|
|
|
|
|
Year
Ended
|
|
|
Year
Ended
|
|
|
January
10, 1996 (INCEPTION)
|
|
|
|
|
December 31
|
|
|
December 31
|
|
|
To
December 31
|
|
|
|
|
2007
|
|
|
2006
|
|
|
2007
|
|
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
flows provided by (used for) operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
|
(5,039,982
|
)
|
|
|
-
|
|
|
|
(8,088,132
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
to reconcile net loss to net cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
provided
by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued for services
|
|
|
1,453,700
|
|
|
|
-
|
|
|
|
1,453,700
|
|
|
Stock
purchase warrants issued for services
|
|
|
1,187,554
|
|
|
|
|
|
|
|
1,187,554
|
|
|
Convertible
debenture beneficial conversion interest
|
|
|
460,315
|
|
|
|
|
|
|
|
460,315
|
|
|
Bad
debt expense
|
|
|
-
|
|
|
|
-
|
|
|
|
28,770
|
|
|
Impairment
loss on intellectual property
|
|
|
10,000
|
|
|
|
|
|
|
|
10,000
|
|
|
Depreciation
|
|
|
34,881
|
|
|
|
-
|
|
|
|
130,260
|
|
|
Discount
for warrant valuation
|
|
|
-
|
|
|
|
-
|
|
|
|
244,802
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
Changes
in operating assets and liabilities:
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
(Increase)
decrease in accounts receivable
|
|
|
-
|
|
|
|
-
|
|
|
|
(22,274
|
)
|
|
(Increase)
decrease in inventory
|
|
|
-
|
|
|
|
-
|
|
|
|
(216,867
|
)
|
|
(Increase)
decrease in prepaid expenses and other assets
|
|
|
-
|
|
|
|
-
|
|
|
|
7,666
|
|
|
(Decrease
) Increases in accounts payable and accrued expenses:
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
Prepetition
|
|
|
-
|
|
|
|
-
|
|
|
|
(59,032
|
)
|
|
Post
petition
|
|
|
293,085
|
|
|
|
-
|
|
|
|
1,007,337
|
|
|
Decrease in
settlement receivable
|
|
|
-
|
|
|
|
-
|
|
|
|
362,694
|
|
|
Advances
from related party
|
|
|
149,373
|
|
|
|
|
|
|
|
149,373
|
|
|
(Decrease
) in fees payable
|
|
|
-
|
|
|
|
-
|
|
|
|
(75,000
|
)
|
|
Net
cash ( used in ) operating activities
|
|
|
(1,451,074
|
)
|
|
|
-
|
|
|
|
(3,418,834
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS USED IN INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payment
of debt
|
|
|
-
|
|
|
|
-
|
|
|
|
(118,623
|
)
|
|
Loans
made to stockholders
|
|
|
-
|
|
|
|
-
|
|
|
|
(100,000
|
)
|
|
Purchase
of property and equipment
|
|
|
(130,182
|
)
|
|
|
-
|
|
|
|
(302,583
|
)
|
|
Net
cash ( used in ) investing activities
|
|
|
(130,182
|
)
|
|
|
-
|
|
|
|
(521,206
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds
from issuance of convertible debentures
|
|
|
581,500
|
|
|
|
-
|
|
|
|
581,500
|
|
|
Proceeds
from sale of preferred stock
|
|
|
-
|
|
|
|
-
|
|
|
|
3,500,000
|
|
|
Proceeds
from sale of common stock
|
|
|
1,000,000
|
|
|
|
|
|
|
|
1,000,000
|
|
|
Proceeds
from short term borrowing
|
|
|
-
|
|
|
|
-
|
|
|
|
1,615,000
|
|
|
Payment
of offering costs for sale of preferred stock
|
|
|
-
|
|
|
|
-
|
|
|
|
(500,000
|
)
|
|
Payment
of offering costs for sale of Senior Notes
|
|
|
-
|
|
|
|
-
|
|
|
|
(290,715
|
)
|
|
Payment
of prepetition liabilities
|
|
|
-
|
|
|
|
-
|
|
|
|
(1,781,737
|
)
|
|
Loans
repaid to stockholder
|
|
|
-
|
|
|
|
-
|
|
|
|
(183,764
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
cash provided by financing activities
|
|
|
1,581,500
|
|
|
|
-
|
|
|
|
3,940,284
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
( DECREASE ) INCREASE IN CASH AND CASH EQUIVALENTS
|
|
|
244
|
|
|
|
-
|
|
|
|
244
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
AND CASH EQUIVALENTS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
beginning of period
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH
(BANK INDEBTEDNESS):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
end of period
|
|
|
244
|
|
|
|
-
|
|
|
|
244
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS - continued
|
|
|
|
|
|
|
|
|
|
|
|
FOR
THE PERIOD FROM
|
|
|
|
|
Year
Ended
|
|
|
Year
Ended
|
|
|
|
January
10, 1996 (INCEPTION)
|
|
|
|
|
December 31
|
|
|
December 31
|
|
|
|
To
December 31
|
|
|
|
|
2007
|
|
|
2006
|
|
|
|
2007
|
|
|
|
|
$
|
|
|
$
|
|
|
|
$
|
|
|
SUPPLEMENTAL
disclosure of CASH FLOW INFORMATION:
|
|
|
|
|
|
|
|
|
|
|
Cash
paid during the year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
paid
|
|
|
-
|
|
|
|
-
|
|
|
|
10,668
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
taxes paid
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non
cash financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued for intellectual property
|
|
|
10,000
|
|
|
|
|
|
|
|
10,000
|
|
|
Issuance
of common stock to settle accrued liabilities
|
|
|
100,000
|
|
|
|
-
|
|
|
|
-
|
|
|
Common
stock issued for conversion of debenture
|
|
|
150,000
|
|
|
|
|
|
|
|
|
|
MY SCREEN MOBILE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2007
NOTE
1 – ORGANIZATION AND BASIS OF PRESENTATION
Organization
and Nature of Operations
My Screen
Mobile, Inc. (the "Company"), formerly Nouveau International Inc., is organized
for the purpose of developing or acquiring the expertise to produce computer
software to be compatible with mobile phone technology. From 1996 until 2006,
the Company was named Nouveau International, Inc. and experienced a period of
dormancy, during which several reorganizations were attempted, but never
completed. On April 19, 2007 the Company filed a Certificate of Amendment with
the state of Delaware and changed its legal name and management was established
with the above purposes planned.
The
Company is a Development Stage Company as defined by SEC Industry Guide 7 and
follows the provisions of the Financial Accounting Standards Board ("FASB")
Statement of Financial Accounting Standards ("SFAS") NO. 7, where applicable.
The Company was incorporated under the laws of the state of Delaware on January
10, 1996. The Company acquired 2089207 Ontario Inc. which operates as MyScreen
Mobile in Canada on April 2, 2007.
Basis
of Presentation
These
consolidated financial statements include the accounts My Screen Mobile, Inc.
and its wholly-owned subsidiary 2089207, with all inter-company transactions and
balances having been eliminated.
These
consolidated financial statements and related notes are presented in accordance
with accounting principles generally accepted in the United States, and are
expressed in US dollars.
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
Cash
and Cash Equivalents
The
Company considers all highly liquid instruments with an original maturity or
remaining maturity at the date of purchase of three months or less to be cash
equivalents.
Property
and Equipment
Property,
plant, and equipment are stated at cost less accumulated depreciation. No
amortization is provided for construction in progress until the assets are ready
for their intended use. Repairs and maintenance expenditures are charged to
operating expense as incurred. Depreciation is calculated on a straight line
basis over the expected useful life as follows:
|
Computer
equipment and software
|
3
years
|
|
Office
furniture and equipment
|
5
years
|
|
Leasehold
improvements
|
term of the
lease
|
Fair
Value of Financial Instruments
The
Company’s financial instruments include cash, accrued liabilities, and notes
payable. The fair value of these financial instruments approximates
their carrying values due to their short maturities.
Accounting
Estimates
The
preparation of the financial statements in conformity with accounting principles
generally accepted in the United States of America 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 and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
MY SCREEN MOBILE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2007
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES - continued
Revenue
Recognition
Revenue
is recognized when goods are shipped.
Foreign
Currency Translation
The
Company’s functional and reporting currency is the United States dollar.
Monetary assets and liabilities denominated in foreign currencies are translated
in accordance with SFAS No. 52
Foreign Currency Translation
,
using the exchange rate prevailing at the balance sheet date. Historical cost
balances are remeasured using historical exchange rates. Gains and losses
arising on settlement of foreign currency denominated transactions or balances
are included in the determination of income. The total net loss resulting from
foreign currency transactions during 2007 and 2006 was approximately $1,800 and
0, respectively, which was recorded in selling, general and administrative
expenses in these consolidated financial statements. Foreign currency
transactions are primarily undertaken in Canadian dollars. The
Company has not to the date of these financial statements, entered into
derivative instruments to offset the impact of foreign currency
fluctuations.
Income
Taxes
Income
tax expense is based on pre-tax financial accounting income. 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, including tax loss and credit carryforwards, 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. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date. Deferred income tax expense represents the change
during the period in the deferred tax assets and deferred tax liabilities. The
components of the deferred tax assets and liabilities are individually
classified as current and non-current based on their characteristics. Deferred
tax assets are reduced by a valuation allowance when, in the opinion of
management, it is more likely than not that some portion or all of the deferred
tax assets will not be realized.
Basic
and Diluted Net (Loss) Per Common Share (“EPS”)
Basic net
(loss) per share is computed by dividing the net (loss) attributable to the
common stockholders by the weighted average number of common shares outstanding
during the reporting period. Diluted net income per common share
includes the potential dilution that could occur upon exercise of warrants or
conversion of debt to acquire common stock. The computation of Diluted EPS does
not assume exercise or conversion of securities that would have an anti-dilutive
effect on net income per common share.
At
December 31, 2007, the Company had issued and outstanding 106,868,193 common
shares, 633,333 common stock purchase warrants, and had issued debentures that
were convertible into 276,279 shares of common stock. All of the stock purchase
warrants and convertible debentures were potentially dilutive. There were no
potentially dilutive securities issued and outstanding at December 31,
2006.
MY SCREEN MOBILE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2007
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES - continued
Stock-Based
Compensation
In
December 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS No.
123(R),
Share-Based
Payment
(“SFAS 123(R)”), which is a revision of SFAS No. 123,
Accounting
for Stock
Based Compensation. SFAS 123(R) was
effective for public companies for the first fiscal year beginning after June
15, 2005, supersedes Accounting Principles Board Opinion No. 25 (“APB 25”),
Accounting
for Stock Issued to Employees
, and amends SFAS 95,
Statement
of Cash Flows
. SFAS 123(R) eliminates the option to use APB
25’s intrinsic value method of accounting and requires recording expense for
stock compensation based on a fair value based method.
The
Company occasionally will issue shares of stock and stock warrants in exchange
for services. The Company values the issuance of shares based on the fair value
of its stock on the date of issuance. The Company values the warrants it issues
based on the Black-Scholes model and in accordance with SFAS No.
123R.
Reclassifications
Certain
prior period amounts have been reclassified to conform to current year
presentation.
Recent
Accounting Pronouncements
We do not
expect the adoption of any recent accounting pronouncements to have a material
effect on the financial statements.
NOTE
3 – GOING CONCERN
These
financial statements have been prepared on a going concern basis, which implies
the Company will continue to realize its assets and discharge its liabilities in
the normal course of business. The Company has not generated any revenues since
inception and has never paid any dividends and is unlikely to pay dividends or
generate earnings in the immediate or foreseeable future. The continuation of
the Company as a going concern is dependent upon the continued financial support
from its shareholders, the ability of the Company to obtain necessary equity
financing to continue operations, and the attainment of profitable operations.
At December 31, 2007, the Company had accumulated losses of $8,088,132 since
inception. These factors raise substantial doubt regarding the
Company’s ability to continue as a going concern. There is no assurance that the
Company will be able to generate revenues in the future. These financial
statements do not give any effect to any adjustments that would be necessary
should the Company be unable to continue as a going concern and therefore be
required to realize its assets and discharge its liabilities in other than the
normal course of business and at amounts different from those reflected in the
accompanying financial statements.
NOTE
4 – PROPERTY AND EQUIPMENT
Property and equipment
consist of the following:
|
|
|
Cost
|
|
|
Accumulated
Depreciation
|
|
|
Net
|
|
|
Leasehold
improvements
|
|
$
|
33,774
|
|
|
$
|
11,257
|
|
|
$
|
22,517
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Computer
equipment
|
|
$
|
32,560
|
|
|
$
|
10,854
|
|
|
$
|
21,706
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Office
furniture and equipment
|
|
$
|
63,847
|
|
|
$
|
12,769
|
|
|
$
|
51,078
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
130,181
|
|
|
$
|
34,881
|
|
|
$
|
95,301
|
|
Total
depreciation expense for the years ended December 31, 2007 and 2006 was $34,881
and $0, respectively.
MY SCREEN MOBILE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2007
NOTE
5 – INTANGIBLE ASSETS
On April
4, 2007 the Company issued 10,000,000 shares of its common stock to acquire
patents and intellectual property, for $10,000. As of December 31, 2007, the
Company determined these intangible assets were impaired due to lack of
foreseeable cash flows generated by these assets, and accordingly recorded
an impairment loss of $10,000.
NOTE
6 – CONVERTIBLE DEBENTURES
Convertible
debentures mature four years from the date of issuance and all have the
following interest rate payment schedule: year 1 – 6%; year 2 – 8%;
year 3 – 10%; year 4 – 12%. Interest is paid yearly, in arrears. The convertible
debentures may be converted at any time in whole or in part, at the option of
the holders, into restricted common shares of the Company at conversion prices
ranging from $1.00 to $1.63. Convertible debentures in the amount of
$431,500 were outstanding on December 31, 2007, with none being outstanding at
December 31, 2006. See the table below for additional information on the
convertible debentures:
|
|
|
|
Principal
amount of Debenture
|
|
Maturity
Date
|
Interest
Rate
|
|
Conversion
Price
|
|
|
FV
of stock on date of issuance
|
|
|
|
#1
|
|
|
$
|
200,000
|
|
May
9, 2011
|
See
above
|
|
$
|
1.50
|
|
|
$
|
2.70
|
|
|
|
#2
|
|
|
$
|
47,500
|
|
August
24, 2011
|
See
above
|
|
$
|
1.58
|
|
|
$
|
2.75
|
|
|
|
#3
|
|
|
$
|
184,000
|
|
August
31, 2011
|
See
above
|
|
$
|
1.63
|
|
|
$
|
2.65
|
|
|
|
#4
|
|
|
$
|
150,000
|
|
October
15, 2011
|
None
|
|
$
|
1.00
|
|
|
$
|
3.04
|
|
Each of
the above convertible debentures contain a beneficial conversion feature as
calculated using the provisions of EITF 98-5. For Debenture #4 above, the
intrinsic value of the beneficial conversion feature was greater than the
proceeds allocated to the convertible debenture. As such, the amount assigned to
the debt discount was limited to the $150,000. Additionally, Debenture #4 above
was converted to common shares on October 15, 2007. For all 4 debentures, since
the debt is convertible on the date of issuance, the amount of the related debt
discounts were immediately charged to interest expense. See the chart
below:
|
|
|
|
Debt
discount from beneficial conversion
|
|
|
Amount
charged to interest expense
|
|
|
|
#1
|
|
|
$
|
115,141
|
|
|
$
|
115,141
|
|
|
|
#2
|
|
|
$
|
35,174
|
|
|
$
|
35,174
|
|
|
|
#3
|
|
|
$
|
160,000
|
|
|
$
|
160,000
|
|
|
|
#4
|
|
|
$
|
306,000
|
|
|
$
|
150,000
|
|
|
|
|
|
|
TOTAL
|
|
|
$
|
460,315
|
|
Subsequent
to December 31, 2007, debentures #1, #2, and #3 were converted into common stock
of the Company at their respective conversion prices.
MY SCREEN MOBILE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2007
NOTE
7 – RELATED PARTY TRANSACTIONS
The
Company has an agreement with one of its shareholders (approximate 27% owner)
whereby the shareholder’s company will perform programming services to the
Company in developing its mobile phone technology. On occasion, the
shareholder’s company has also advanced operating capital to the Company, on an
as needed basis, and carrying an outstanding balance at December 31, 2007 of
$149,373. No formal note payable has been established for such advances, and as
such no related interest expense has been accrued. Subsequent to year end this
amount was paid back to the shareholder’s company, in full. Total programming
expenses recorded for this related party were $2.3 million in 2007.
NOTE
8 – ACCRUED LIABILITIES
The
Company’s accrued liabilities consist of accrued programming expenses of
$281,000, and accrued interest of $12,000 (all approximate
amounts).
NOTE
9 – STOCKHOLDERS’ EQUITY
On March
11, 2007, the Company’s Board of Directors approved a 1 for 100 stock reverse
split. Additionally, on May 11, 2007, the Company’s Board of Directors
approved a 4 for 1 forward stock split. These consolidated financial statements
have been retroactively adjusted to account for these stock splits as if the
splits occurred at inception.
On April
4, 2007, the Company issued 15,996,000 shares of common stock to various
creditors for the $100,000 liability that was accrued at December 31,
2006.
On May
23, 2007, the Company issued 35,000,000 shares of its common stock for cash of
$1,000,000.
During
the year ended December 31, 2007, the Company issued 45,353,333 shares of its
common stock for services provided to the Company. The related consulting
expense was valued using the fair value of the Company’s common stock on the
date of issuance, and totalled $1,453,700 for the year ended December 31, 2007.
No common stock shares were issued during the year ended December 31,
2006.
The
Company issued 633,333 stock purchase warrants during the year ended December
31, 2007. These warrants were valued on the date of issuance using the
Black-Scholes model that generated a total fair value of $1,187,554. This amount
was recorded as consulting expense in these consolidated financial statements.
All 633,333 warrants remain outstanding at December 31, 2007. No stock purchase
warrants were issued for the year ended December 31, 2006.
As noted
in Footnote 6 above, the Company issued convertible debentures during the year
ended December 31, 2007 that had beneficial conversion features. The related
debt discounts were fully amortized due to the holder being able to convert
these debentures into the Company’s common stock upon issuance. As a result,
$460,315 was recorded to additional paid in capital for the year ended December
31, 2007.
NOTE
10 – SUBSEQUENT EVENTS
On May
22, 2008, the Company issued 12,500,000 shares of its common stock along with
20,000,000 stock purchase warrants for $10,000,000 in cash. The warrants have an
exercise price of $2 per common share.
As noted
above in Footnote 6, all convertible debentures issued prior to December 31,
2007 have been converted to common stock of the Company.
ITEM
13. EXHIBITS
|
Exhibit
#
|
Description
|
|
10.1
|
Exclusivity
Agreement between MyScreen Mobile, Inc. and Orascom Telecom Holdings
SAE.
|
|
|
|
|
31.1
|
Certification
of Chief Executive Officer pursuant to Rule 13a-14
or
15d-14 of the Securities Exchange Act of 1934, as adopted pursuant to
section
302
of the Sarbanes-Oxley act of 2002.
|
|
|
|
|
31.2
|
Certification
of Chief Financial Officer pursuant to Rule 13a-14
or
15d-14 of the Securities Exchange Act of 1934, as adopted pursuant to
section
302
of the Sarbanes-Oxley act of 2002.
|
|
|
|
|
32.1
|
Certification
of Chief Executive Officer pursuant to 18 U.S.C.
Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
|
|
|
32.2
|
Certification
of Chief Financial Officer pursuant to 18 U.S.C.
Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
|
|
|
99.1
|
Audit
Committee Charter
|
ITEM
14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Audit Committee Pre-Approval
Policy
The
Company did not have an audit committee established prior to the engagement of
the Company’s independent auditor and preparation of the financial statements
and financial information disclosed in this Report.
To
ensure the independence of the Company’s independent auditor and to comply with
applicable securities laws, listing standards, and the Audit Committee charter,
the Audit Committee is responsible for reviewing, deliberating and, if
appropriate, pre-approving all audit, audit-related, and non-audit services to
be performed by the Company’s independent auditors. For that purpose, the Audit
Committee has established a policy and related procedures regarding the
pre-approval of all audit, audit-related, and non-audit services to be performed
by the Company’s independent auditor (the “Policy”).
ITEM
14. PRINCIPAL ACCOUNTANT FEES AND SERVICES - continued
The
Policy provides that the Company’s independent auditor may not perform any
audit, audit-related, or non-audit service for the Company, subject to those
exceptions that may be permitted by applicable law, unless: (1) the service has
been pre-approved by the Audit Committee, or (2) the Company engaged the
independent auditor to perform the service pursuant to the pre-approval
provisions of the Policy. In addition, the Policy prohibits the Audit Committee
from pre-approving certain non-audit services that are prohibited from being
performed by the Company’s independent auditor by applicable securities laws.
The Policy also provides that the Chief Financial Officer will periodically
update the Audit Committee as to services provided by the independent auditor.
With respect to each such service, the independent auditor provides detailed
back-up documentation to the Audit Committee and the Chief Financial
Officer.
The Chief
Executive Officer appointed Madsen & Associates, Madsen & Associates as
the Company’s independent accountants to audit the consolidated financial
statements of the Company for the fiscal year ending December 31,
2007. Madsen & Associates have been our independent accountant
since 2006.
Principal Accountant
Fees
Fees for
fiscal years ended December 31, 2007 and 2006 were as follows:
|
|
Fiscal
2007
|
|
Fiscal
2006
|
|
|
Audit
Fees
|
|
$
|
9,800
|
|
|
$
|
3,042
|
|
|
|
|
|
Audit-Related Fees
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax
Fees
|
|
|
600
|
|
|
|
600
|
|
|
|
|
|
All
Other Fees
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Fees
|
|
$
|
10,400
|
|
|
$
|
3,642
|
|
A
description of the types of services provided in each category is as
follows:
Audit Fees
—Includes fees
billed for professional services rendered by our principal accountant for the
audit of our annual financial statements and for other services normally
provided by our accountant in connection with statutory and regulation filings
or engagements.
Audit-Related Fees
—Includes
fees billed for assurance and related services by our principal accountant that
were reasonably related to the performance of the audit or review of our
financial statements.
Tax Fees
—Includes fees billed
for professional services rendered by our principal accountant for preparation
of our Federal Tax Returns.
All Other Fees
—Includes fees
billed for products and services provided by our principal accountant other than
services reported under Audit Fees, Audit-Related Fees and Tax
Fees.
Signatures
In
accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized, on December 31, 2008.
|
|
MY SCREEN MOBILE,
INC.
|
|
|
|
|
|
|
|
|
By:
|
/s/
Terrence Rodrigues
|
|
|
|
|
Terrence
Rodrigues
|
|
|
|
|
Chief
Executive Officer and President
|
|
|
|
|
|
|
In
accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities indicated on
December 31, 2008
|
By:
|
/s/
Terrence
Rodrigues
|
Director,
Chief Executive Officer and President
|
|
|
|
Terrence
Rodrigues
|
|
|
|
By:
|
/s/
Raghunath
Kilambi
|
Director,
Chief Financial Officer
|
|
|
Raghunath
Kilambi
|
|
|
|
|
|
|
By:
|
/s/
James Bailey
|
Director
|
|
|
James
Bailey
|
|
33
My Screen Mobile (CE) (USOTC:MYSL)
Graphique Historique de l'Action
De Mai 2024 à Juin 2024
My Screen Mobile (CE) (USOTC:MYSL)
Graphique Historique de l'Action
De Juin 2023 à Juin 2024
