EX-9 3 exhibit9012.htm Converted by EDGARwiz

Exhibit 9.01.2














BITZIO, INC.

(FKA ROCKY MOUNTAIN FUDGE COMPANY, INC.)

(A Development Stage Company)


CONSOLIDATED FINANCIAL STATEMENTS


June 30, 2011








1





BITZIO, INC.

(Formerly Rocky Mountain Fudge Company, Inc.)

(A Development Stage Company)

Consolidated Balance Sheets

 

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

June 30,

 

December 31,

 

 

 

 

 

2011

 

2010

 

 

 

 

 

(Unaudited)

 

 

CURRENT ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash

 

 

$

         2,731

 

$

       18,068

 

Prepaid expenses

 

 

     292,500

 

 

            108

 

 

Total Current Assets

 

     295,231

 

 

       18,176

 

 

 

 

 

 

 

 

 

 

FIXED ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Computer equipment, net

 

         1,365

 

 

         1,706

 

 

TOTAL ASSETS

$

     296,596

 

$

       19,882

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

 

$

            440

 

$

            146

 

Accounts payable and accrued expenses - related party

 

            392

 

 

                 -

 

Note payable - related party

 

       25,000

 

 

            392

 

 

Total Current Liabilities

 

25,832

 

 

            538

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock; 100,000,000 shares authorized,

 

 

 

 

 

 

  at $0.001 par value, 33,750,000 and 33,000,000 shares

 

 

 

 

 

 

  issued and outstanding, respectively

 

33,750

 

 

33,000

 

Additional paid-in capital

 

501,700

 

 

208,450

 

Deficit accumulated during the development stage

 

(264,686)

 

 

(222,106)

 

 

 

 

 

 

 

 

 

 

 

 

Total Stockholders' Equity

 

270,764

 

 

19,344

 

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

296,596

 

$

19,882



2






BITZIO, INC.

(Formerly Rocky Mountain Fudge Company, Inc.)

(A Development Stage Company)

Consolidated Statements of Operations

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

From Inception

 

 

 

 

 

 

 

 

 

 

 

on January 4,

 

 

 

For the Three Months Ended

 

For the Six Months Ended

 

1990 through

 

 

 

June 30,

 

June 30,

 

June 30,

 

 

 

2011

 

2010

 

2011

 

2010

 

2011

REVENUES

$

                 -

 

$

                 -

 

$

                 -

 

$

                   -

 

$

157,702

COST OF SALES

 

                 -

 

 

                 -

 

 

                 -

 

 

                   -

 

 

58,459

 

 

GROSS PROFIT

 

                 -

   

 

                 -

 

 

                 -

   

 

                   -

 

 

99,243

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

19,342

 

 

12,768

 

 

22,865

 

 

17,203

 

 

268,776

 

Professional fees

 

13,888

 

 

         2,475

 

 

19,128

 

 

           4,475

 

 

95,631

 

Depreciation

 

170

 

 

                 -

 

 

341

 

 

                   -

 

 

682

 

 

Total Operating Expenses

 

33,400

 

 

15,243

 

 

42,334

 

 

21,678

 

 

365,089

 

 

OPERATING LOSS

 

(33,400)

 

 

(15,243)

 

 

(42,334)

 

 

(21,678)

 

 

(265,846)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSES)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

                 -

 

 

                 -

 

 

                 -

 

 

                   -

 

 

4,437

 

Interest expense

 

          (246)

 

 

           (197)

 

 

           (246)

 

 

            (644)

 

 

(3,277)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Other Income (Expense)

 

          (246)

 

 

           (197)

 

 

           (246)

 

 

            (644)

 

 

1,160

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOSS BEFORE INCOME TAXES

 

     (33,646)

 

 

      (15,440)

 

 

      (42,580)

 

 

       (22,322)

 

 

       (264,686)

PROVISION FOR INCOME TAXES

 

                 -

 

 

                 -

 

 

                 -

 

 

                   -

 

 

                     -

 

 

NET LOSS

$

(33,646)

 

$

(15,440)

 

$

(42,580)

 

$

(22,322)

 

$

(264,686)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BASIC AND DILUTED LOSS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  PER SHARE

$

(0.00)

 

$

(0.00)

 

$

(0.00)

 

$

(0.00)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WEIGHTED AVERAGE NUMBER

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 OF SHARES OUTSTANDING

 

33,090,659

 

 

22,450,548

 

 

33,045,580

 

 

15,762,432

 

 

 



3





BITZIO, INC.

(Formerly Rocky Mountain Fudge Company, Inc.)

(A Development Stage Company)

Consolidated Statements of Stockholders' Equity (Deficit)

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

Additional

 

During the

 

Total

 

 

Common Stock

 

Paid-In

 

Development

 

Stockholders'

 

 

Shares

 

Amount

 

Capital

 

Stage

 

Equity

Balance at inception of development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 stage on January 4, 1990

 

                        -

   

$

-

   

$

-

   

$

-

 

$

         -

Common stock issued for cash

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  at $0.001 per share on

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  August 10, 1990

 

         4,800,000

 

 

         4,800

 

 

         (3,600)

 

 

                     -

 

 

           1,200

Services contributed by

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  shareholders

 

                        -

 

 

                 -

 

 

2,400

 

 

                     -

 

 

           2,400

Shares cancelled as contributed

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  capital by shareholders

 

        (2,000,000)

 

 

       (2,000)

 

 

2,000

 

 

                     -

 

 

                   -

Common stock issued for cash

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  at $0.0003 per share on

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  December 15, 1998

 

         2,000,000

 

 

         2,000

 

 

(1,400)

 

 

                     -

 

 

              600

Common stock issued for cash

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  at $0.25 per share

 

            200,000

 

 

            200

 

 

49,800

 

 

                     -

 

 

         50,000

Stock offering costs

 

                        -

   

 

                 -

   

 

       (10,000)

   

 

                     -

 

 

       (10,000)

Net loss from inception of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  development stage through

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  December 31, 2004

 

                        -

 

 

                 -

 

 

                   -

 

 

(44,200)

 

 

       (44,200)

Balance, December 31, 2004

 

5,000,000

 

 

5,000

 

 

39,200

 

 

(44,200)

 

 

                   -

Capital contributed by shareholder

 

                        -

 

 

                 -

 

 

         50,000

 

 

                     -

 

 

         50,000

Net loss for the year ended

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  December 31, 2005

 

                        -

 

 

                 -

 

 

                   -

 

 

         (19,545)

 

 

       (19,545)

Balance, December 31, 2005

 

         5,000,000

 

 

         5,000

 

 

         89,200

 

 

         (63,745)

 

 

         30,455

Services contributed   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  by shareholders

 

                        -

 

 

                 -

 

 

           5,000

 

 

                     -

 

 

           5,000

Net loss for the year ended

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  December 31, 2006

 

                        -

 

 

                 -

 

 

                   -

 

 

         (23,234)

 

 

       (23,234)

Balance, December 31, 2006

 

         5,000,000

 

 $

         5,000

 

 $

         94,200

 

 $

         (86,979)

 

 $

         12,221




4






BITZIO, INC.

(Formerly Rocky Mountain Fudge Company, Inc.)

(A Development Stage Company)

Consolidated Statements of Stockholders' Equity (Deficit)

 

 

 

 

 

 

 

 

 

 

 

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

During the

 

 

Total

 

 

Common Stock

 

 

Paid-in

 

 

Exploration

 

 

Stockholders'

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Stage

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, December 31, 2006

    5,000,000

 

$

         5,000

 

$

       94,200

 

$

      (86,979)

 

$

            12,221

Common shares issued for debt

    4,000,000

 

 

         4,000

 

 

       22,300

 

 

                 -

 

 

            26,300

Services contributed by shareholders

                   -

 

 

                 -

 

 

         5,000

 

 

                 -

 

 

              5,000

Net loss for the year ended

 

 

 

 

 

 

 

 

 

 

 

 

 

  December 31, 2007

                   -

 

 

                 -

 

 

                 -

 

 

      (36,752)

 

 

           (36,752)

Balance, December 31, 2007

    9,000,000

 

 

         9,000

 

 

     121,500

 

 

    (123,731)

 

 

              6,769

Services contributed by shareholders

                   -

 

 

                 -

 

 

         7,200

 

 

                 -

 

 

              7,200

Capital contributed by shareholder

                   -

 

 

                 -

 

 

       25,750

 

 

                 -

 

 

            25,750

Net loss for the year ended

 

 

 

 

 

 

 

 

 

 

 

 

 

  December 31, 2008

                   -

 

 

                 -

 

 

                 -

 

 

      (33,876)

 

 

           (33,876)

Balance, December 31, 2008

    9,000,000

 

 

         9,000

 

 

     154,450

 

 

    (157,607)

 

 

              5,843

Services contributed by shareholders

                   -

 

 

                 -

 

 

         1,000

 

 

                 -

 

 

              1,000

Net loss for the year ended

 

 

 

 

 

 

 

 

 

 

 

 

 

  December 31, 2009

                   -

 

 

                 -

 

 

                 -

 

 

      (26,287)

 

 

           (26,287)

Balance, December 31, 2009

    9,000,000

 

 

         9,000

 

 

     155,450

 

 

    (183,894)

 

 

           (19,444)

Common shares issued for cash

  16,000,000

 

 

       16,000

 

 

       34,000

 

 

                 -

 

 

            50,000

Common shares issued for debt

    8,000,000

 

 

         8,000

 

 

       17,000

 

 

                 -

 

 

            25,000

Services contributed by shareholders

                   -

 

 

                 -

 

 

         2,000

 

 

                 -

 

 

              2,000

Net loss for the year ended

 

 

 

 

 

 

 

 

 

 

 

 

 

  December 31, 2010

                   -

 

 

                 -

 

 

                 -

 

 

      (38,212)

 

 

           (38,212)

Balance, December 31, 2010

  33,000,000

 

 

       33,000

 

 

     208,450

 

 

    (222,106)

 

 

            19,344

Services contributed by shareholders (unaudited)

                   -

 

 

                 -

 

 

         1,500

 

 

                 -

 

 

              1,500

Common shares issued for services (unaudited)

       750,000

 

 

            750

 

 

     291,750

 

 

                 -

 

 

          292,500

Net loss for the six months ended

 

 

 

 

 

 

 

 

 

 

 

 

 

  June 30, 2011 (unaudited)

                   -

 

 

                 -

 

 

                 -

 

 

      (42,580)

 

 

           (42,580)

Balance, June 30, 2011 (unaudited)

  33,750,000

 

$

       33,750

 

$

     501,700

 

$

    (264,686)

 

$

          270,764




5






BITZIO, INC.

(Formerly Rocky Mountain Fudge Company, Inc.)

(A Development Stage Company)

Consolidated Statements of Cash Flows

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

From Inception

 

 

 

 

 

 

 

 

on January 4,

 

 

 

 

 

 

For the Six Months Ended

 

1990 through

 

 

 

 

 

 

June 30,

 

June 30,

 

 

 

 

 

 

2011

 

2010

 

2011

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

 

 

 

Net loss

 

 

$

(42,580)

 

$

(22,322)

 

$

    (264,686)

 

Adjustments to reconcile net loss to

 

 

 

 

 

 

 

 

 

  net cash used by operating activities:

 

 

 

 

 

 

 

 

 

 

Services contributed by officers

 

 

 

 

 

 

 

   

 

 

  and shareholders

 

 

         1,500

 

 

         1,000

 

 

       16,700

 

 

Depreciation and amortization

 

            341

 

 

                 -

 

 

            683

 

 

Loss on settlement of debt

 

 

                 -

 

 

                 -

 

 

            936

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

Prepaid expenses

 

 

            108

 

 

                 -

 

 

                 -

 

 

Accounts payable and accrued expenses

 

            294

 

 

         1,559

 

 

            440

 

 

Due to related parties

 

 

                 -

 

 

            644

 

 

         1,651

 

 

 

Net Cash Used in Operating Activities

 

      (40,337)

 

 

      (19,119)

 

 

    (244,276)

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

 

 

 

 

Purchase of computer equipment

 

                 -

 

 

        (2,048)

 

 

        (2,048)

 

 

 

Net Cash Used in Investing Activities

 

                 -

 

 

        (2,048)

 

 

        (2,048)

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

 

 

Note payable - related party

 

       25,000

 

 

                 -

 

 

       74,105

 

 

Contributed capital

 

 

                 -

 

 

                 -

 

 

       83,150

 

 

Sale of common stock for cash

 

                 -

 

 

       50,000

 

 

       91,800

 

 

 

Net Cash Provided by Financing Activities

 

       25,000

 

 

       50,000

 

 

     249,055

 

 

NET INCREASE (DECREASE) IN CASH

 

      (15,337)

   

 

       28,833

   

   

         2,731

 

 

CASH AT BEGINNING OF PERIOD

 

       18,068

 

 

         5,476

 

 

                 -

 

 

CASH AT END OF PERIOD

$

         2,731

 

$

       34,309

 

$

         2,731

SUPPLEMENTAL DISCLOSURES OF

 

 

 

 

 

 

 

 

 

 

CASH FLOW INFORMATION

 

 

 

 

 

 

 

 

 

CASH PAID FOR:

 

 

 

 

 

 

 

 

 

 

 

 

Interest

 

 

$

                 -

 

$

                 -

 

$

              79

 

 

Income Taxes

 

 

$

                 -

 

$

                 -

 

$

                 -

 

NON CASH FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

 

 

Common stock issued for debt

$

                 -

 

$

       24,064

 

$

       50,364

 

 

Common stock issued for prepaid expenses

$

     292,500

 

$

                 -

 

$

     292,500



6



BITZIO, INC.

(Formerly Rocky Mountain Fudge Company, Inc.)

(A Development Stage Company)

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2011 and December 31, 2010


NOTE 1 -   CONDENSED FINANCIAL STATEMENTS


The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows at June 30, 2011 and 2010  and for all periods presented have been made.


Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's December 31, 2010 audited financial statements. The results of operations for the periods ended June 30, 2011 and 2010 are not necessarily indicative of the operating results for the full years.


NOTE 2 -   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Reclassification


Certain balances in previously issued financial statements have been reclassified to be consistent with the current period presentation.


Estimates


The preparation of 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


Recent Accounting Pronouncements


The Company has evaluated recent accounting pronouncements and their adoption has not had or is not expected to have a material impact on the Company’s financial position or statements.


NOTE 3 -   RELATED PARTY TRANSACTIONS


During the period ended June 30, 2011, a shareholder of the Company loaned the Company $25,000.    Previously, the Company’s president paid $392 of expenses on behalf of the Company, which was added to the terms of the note. The note accrues interest at a rate of 8.0% per annum, and is due on demand.  As of June 30, 2011, accrued interest payable pursuant to the note totaled $247.


During the six months ended June 30, 2011, the Company’s president performed services valued at $1,500 which have been recorded as a contribution to capital.





7



BITZIO, INC.

(Formerly Rocky Mountain Fudge Company, Inc.)

(A Development Stage Company)

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2011 and December 31, 2010


NOTE 4 -   GOING CONCERN


The Company's financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business.  The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable.  If the Company is unable to obtain adequate capital, it could be forced to cease operations.


In order to continue as a going concern, the Company will need, among other things, additional capital resources.  Management's plans to obtain such resources for the Company include (1) obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses, and (2) seeking out and completing mergers with existing operating companies.  However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.


The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations.  The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.


NOTE 5 – SIGNIFICANT EVENTS


Formation of Subsidiary


On May 28, 2010 the Company formed Eveps International, Inc. (“Eveps”), a Nevada company, as a wholly-owned subsidiary.  Eveps was formed with the intent to be utilized as a vehicle to facilitate any potential future merger transactions with existing operating entities.  On September 24, 2010 the Company changed the corporate name of this entity from Eveps International, Inc. to Wireless Power Controls, Inc. (“Wireless”), which is a wholly-owned subsidiary of the Company.  All intercompany transactions between the Company and Wireless have been eliminated in the preparation of these consolidated financial statements.


Corporate Name Change


Effective May 31, 2011, a Certificate of Amendment to Articles of Incorporation was filed with the Nevada Secretary of State changing the name of the Registrant from Rocky Mountain Fudge Company, Inc. to Bitzio, Inc.  Pursuant to this transaction, shares of the Company’s common stock are now trading under the Company’s new trading symbol, BTZOD.


Stock-Split


Effective May 19, 2011, the Registrant effected a four-for-one forward-split of the shares of its common stock.  All references to common stock activity in these financial statements have been retroactively restated so as to incorporate the effects of this stock-split.


Equity Transactions


On June 23, 2011, the Company issued 750,000 shares to various consultants for services to be performed over the succeeding 12 months. The shares were valued at the trading price on the issuance date of $0.39 per share, for a total value of $292,500, and are being amortized over the 12-month service period.




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BITZIO, INC.

(Formerly Rocky Mountain Fudge Company, Inc.)

(A Development Stage Company)

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2011 and December 31, 2010


NOTE 6 – SUBSEQUENT EVENTS


Acquisition of Empire Group, LLC


On July 11, 2011, the Company’s wholly-owned subsidiary, Empire Holding, Inc., entered into an agreement (the “Agreement”) with two individuals (collectively, the “Sellers”) to acquire all of their interests in The Empire Group LLC. There is no material relationship between the Company and the Sellers, other than the Agreement.


The Company, through its subsidiary Empire Holding, Inc. will pay the Sellers a total of $600,000 in three monthly installments of $200,000 each, commencing on the July 31, 2011 closing date of the Agreement.


The Empire Group LLC is an established developer of entertainment-based mobile applications for smartphones.


Acquisition of Bitzio Corp.


On July 13, 2011, the Company’s wholly owned subsidiary, Bitzio Holdings, Inc., entered into an agreement (the “Agreement”) with an individual (the “Seller”) to acquire all of the shares of Bitzio Corp. There is no material relationship between the Company and the Seller, other than the Agreement.


Bitzio Corp. is a company that focuses on developing niche mobile applications for consumers and organizations.


As consideration for the acquisition, the Company, through its subsidiary Bitzio Holdings, Inc., will grant to the Seller 5,000,000 shares of the Company’s common stock.  These shares were issued on August 9, 2011.


Acquisition of Digispace Solutions, LLC


On August 3, 2011, the Company’s wholly-owned subsidiary, Digispace Holdings, Inc., entered into an agreement (the “Digispace Agreement”) with two individuals (collectively, the “Sellers”) to acquire all of their interests in Digispace Solutions, LLC.  As consideration for the acquisition, Digispace Holdings, Inc. will pay to the Sellers $200,000 cash in 12 monthly installments commencing on the closing date and will assume approximately $575,000 of Digispace Solutions, LLC debt.  The Company will grant options to the Sellers to purchase up to 1,000,000 shares of the Company’s common stock at a price of $0.45 per share for five years following the closing date. The closing date for the acquisition is contracted to be or before August 22, 2011.


There is no material relationship between the Company and the Sellers, other than the Digispace Agreement and the Bitzio Corp. Agreement described below.


Digispace Solutions, LLC is an online performance-based advertising company offering a variety of services to assist in the development of a company’s online presence, marketing, tracking and customer management. It provides proprietary web technologies to power online strategies and solutions.


Stock Option Grants


On July 1, 2011, the Company granted options to purchase 5,000,000 shares of common stock to an officer of the Company.  These options have a strike price of $0.25 per share, and expire after a period of five years.


Other Events

In accordance with ASC 855-10, Company management reviewed all material events through the date of this report and there are no material subsequent events to report.



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