UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended June 30, 2012
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ____________ to _____________
Commission file number 333-168897
BERRY ONLY INC.
(Exact name of registrant as specified in its charter)
Nevada 99-0360497
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
36 McLean Street Red Bank, NJ 07701
(Address of principal executive offices) (Zip Code)
732-865-4252
(Registrant's telephone number, including area code)
Securities registered under Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
------------------- -----------------------------------------
None N/A
Securities registered under Section 12(g) of the Act:
Common Stock, $0.001 par value
------------------------------
(Title of class)
Indicate by checkmark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes [ ] No [X]
Indicate by checkmark if the registrant is not required to file reports pursuant
to Section 13 or 15(d) of the Act. Yes [ ] No [X]
Indicate by checkmark whether the registrant has (1) filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
Indicate by checkmark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (ss. 229.405 of this chapter) is not contained herein, and will
not 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-K
or any amendment to this Form 10-K. [X]
Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). YES [X] NO [ ]
Indicate by checkmark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
(Do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Act). Yes [X] No [ ]
State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was last sold, or the average bid and asked price of such common equity, as of
the last business day of the registrant's most recently completed fiscal
quarter: $29,500 based on a price of $0.01 per share, being the issue price
pershare of the last private placement of our company in June, 2010. The
aggregate market value as determined by the average of bid and ask closing
prices is inapplicable due to the fact that the common shares of our company
have not traded to date.
APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PAST FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes [ ] No [ ] N/A
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date. 5,950,000 shares of common
stock as of October 15, 2012.
DOCUMENTS INCORPORATED BY REFERENCE
List hereunder the following documents if incorporated by reference and the Part
of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is
incorporated: (1) any annual report to security holders; (2) any proxy or
information statement; and (3) any prospectus filed pursuant to Rule 424(b) or
(c) of the Securities Act of 1933. The listed documents should be clearly
described for identification purposes (e.g., annual report to security holders
for fiscal year ended December 24, 1980). Not Applicable
PART I
FORWARD LOOKING STATEMENTS
This annual report contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. These statements relate to future
events or our future financial performance. In some cases, you can identify
forward-looking statements by terminology such as "may", "should", "expects",
"plans", "anticipates", "believes", "estimates", "predicts", "potential" or
"continue" or the negative of these terms or other comparable terminology. These
statements are only predictions and involve known and unknown risks,
uncertainties and other factors, including the risks in the section entitled
"Risk Factors" and the risks set out below, any of which may cause our or our
industry's actual results, levels of activity, performance or achievements to be
materially different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. These
risks include, by way of example and not in limitation:
* the uncertainty that we will not be able to successfully identify and
evaluation a suitable business opportunity;
* risks related to the large number of established and well-financed
entities that are actively seeking suitable business opportunities;
* risks related to the failure to successfully management or achieve
growth of a new business opportunity; and
* other risks and uncertainties related to our business strategy.
This list is not an exhaustive list of the factors that may affect any of our
forward-looking statements. These and other factors should be considered
carefully and readers should not place undue reliance on our forward-looking
statements.
Forward looking statements are made based on management's beliefs, estimates and
opinions on the date the statements are made and we undertake no obligation to
update forward-looking statements if these beliefs, estimates and opinions or
other circumstances should change. Although we believe that the expectations
reflected in the forward-looking statements are reasonable, we cannot guarantee
future results, levels of activity, performance or achievements. Except as
required by applicable law, including the securities laws of the United States,
we do not intend to update any of the forward-looking statements to conform
these statements to actual results.
Our financial statements are stated in United States dollars (US$) and are
prepared in accordance with United States Generally Accepted Accounting
Principles.
In this annual report, unless otherwise specified, all dollar amounts are
expressed in United States dollars and all references to "common stock" refer to
the common shares in our capital stock.
As used in this annual report, the terms "we", "us", "our", and "Berry Only"
mean Berry Only Inc., unless the context clearly requires otherwise.
ITEM 1. BUSINESS
GENERAL
We were incorporated as Berry Only Inc. under the laws of Nevada on June 24,
2009. On July 8, 2010 the Company signed an exclusive dealership agreement with
Wireless Wipes, a New York corporation that manufactures a sanitizing wipe used
to clean cell phones and other mobile devices. The agreement granted the Company
2
the exclusive right to purchase, inventory, promote and resell the product
within Canada under certain minimum order rules. The agreement required an
annual distribution of 10,000 pouches of product. The Company was unable to
generate the required annual sales and the agreement lapsed. The Company is
seeking new business opportunities.
We are currently seeking business opportunities with established business
entities for the merger of a target business with our company. In certain
instances, a target business may wish to become a subsidiary of us or may wish
to contribute assets to us rather than merge. We are currently in negotiations
with several parties to enter into a business opportunity but we have not
entered into any definitive agreements to date and there can be no assurance
that we will be able to enter into any definitive agreements. We anticipate that
any new acquisition or business opportunities by our company will require
additional financing. There can be no assurance, however, that we will be able
to acquire the financing necessary to enable us to pursue our plan of operation.
If our company requires additional financing and we are unable to acquire such
funds, our business may fail.
We have no revenues, have achieved losses since inception, have been issued a
going concern opinion by our auditors and rely upon the sale of our securities
to fund operations. Accordingly, we will be dependent on future additional
financing in order to maintain our operations and continue seeking new business
opportunities.
OUR CURRENT BUSINESS
We are currently business opportunities with established business entities for
the merger of a target business with our company. In certain instances, a target
business may wish to become a subsidiary of us or may wish to contribute assets
to us rather than merge. We are currently in negotiations with several parties
to enter into a business opportunity but we have not entered into any definitive
agreements to date and there can be no assurance that we will be able to enter
into any definitive agreements. We anticipate that any new acquisition or
business opportunities by our company will require additional financing. There
can be no assurance, however, that we will be able to acquire the financing
necessary to enable us to pursue our plan of operation. If our company requires
additional financing and we are unable to acquire such funds, our business may
fail.
Management of our company believes that there are perceived benefits to being a
reporting company with a class of publicly-traded securities. These are commonly
thought to include: (i) the ability to use registered securities to acquire
assets or businesses; (ii) increased visibility in the financial community;
(iii) the facilitation of borrowing from financial institutions; (iv) improved
trading efficiency; (v) stockholder liquidity; (vi) greater ease in subsequently
raising capital; (vii) compensation of key employees through stock options;
(viii) enhanced corporate image; and (ix) a presence in the United States
capital market.
We may seek a business opportunity with entities who have recently commenced
operations, or entities who wish to utilize the public marketplace in order to
raise additional capital in order to expand business development activities, to
develop a new product or service, or for other corporate purposes. We may
acquire assets and establish wholly-owned subsidiaries in various businesses or
acquire existing businesses as subsidiaries.
In implementing a structure for a particular business acquisition or
opportunity, we may become a party to a merger, consolidation, reorganization,
joint venture, or licensing agreement with another corporation or entity. We may
also acquire stock or assets of an existing business. Upon the consummation of a
transaction, it is likely that our present management will no longer be in
control of our company. In addition, it is likely that our officer and director
will, as part of the terms of the acquisition transaction, resign and be
replaced by one or more new officers and directors.
As of the date hereof, management has not entered into any formal written
agreements for a business combination or opportunity. When any such agreement is
reached, we intend to disclose such an agreement by filing a current report on
Form 8-K with the Securities and Exchange Commission.
We anticipate that the selection of a business opportunity in which to
participate will be complex and without certainty of success. Management
believes that there are numerous firms in various industries seeking the
perceived benefits of being a publicly registered corporation. Business
opportunities may be available in many different industries and at various
stages of development, all of which will make the task of comparative
3
investigation and analysis of such business opportunities extremely difficult
and complex. We can provide no assurance that we will be able to locate
compatible business opportunities.
As a development stage company, we are not able to fund our cash requirements
through our current operations. Historically, we have been able to raise a
limited amount of capital through private placements of our equity stock, but we
are uncertain about our continued ability to raise funds privately. Further, we
believe that our company may have difficulties raising capital until we locate a
prospective property through which we can pursue our plan of operation. If we
are unable to secure adequate capital to continue our acquisition efforts, our
shareholders may lose some or all of their investment and our business may fail.
COMPETITION
We conduct our business in an environment that is highly competitive and
unpredictable. In seeking out prospective businesses, we have encountered
intense competition in all aspects of our proposed business as we compete
directly with other development stage companies as well as established
international companies. Many of our competitors are national or international
companies with far greater resources, capital and access to information than us.
As a result of this competition, we may become involved in an acquisition with
more risk or obtain financing on less favorable terms.
COMPLIANCE WITH GOVERNMENT REGULATION
We will not know the government regulations and the cost of compliance with such
regulations with which we must comply until such time as we acquire an interest
in a particular business.
If our activities should advance to the point where we engage in mining or oil
and gas operations, we could become subject to environmental regulations
promulgated by federal, state or provincial, and local government agencies as
applicable. Environmental legislation provides for restrictions and prohibitions
on spills, releases or emissions of various substances produced in association
with the mining industry which could result in environmental liability. A breach
or violation of such legislation may result in the imposition of fines and
penalties. In addition, certain types of operations require the submission and
approval of environmental impact assessments. Environmental assessments are
increasingly imposing higher standards, greater enforcement, fines and penalties
for non-compliance. Environmental assessments of proposed projects carry a
heightened degree of responsibility for companies, directors, officers and
employees. The cost of compliance in respect of environmental regulation has the
potential to reduce the profitability of any future revenues that our company
may generate.
EMPLOYEES
Currently our only employee is our sole director and officer. We do not expect
any material changes in the number of employees over the next 12 month period.
We anticipate that we will be conducting most of our business through agreements
with consultants and third parties. Our sole officer does not have an employment
agreement with us.
SUBSIDIARIES
We do not have any subsidiaries.
INTELLECTUAL PROPERTY
We do not own, either legally or beneficially, any patent or trademark.
ITEM 1A. RISK FACTORS
Our common shares are considered speculative. Prospective investors should
consider carefully the risk factors set out below.
4
RISKS RELATING TO OUR BUSINESS AND FINANCIAL CONDITION
WE ARE A DEVELOPMENT STAGE COMPANY WITH A LIMITED OPERATING HISTORY THAT MAKES
IT IMPOSSIBLE TO RELIABLY PREDICT FUTURE GROWTH AND OPERATING RESULTS.
We have not been able to achieve profitable operations and there are no
assurances that we will be able to do so in the future. Potential investors
should be aware of the difficulties normally encountered by a new enterprise and
the high rate of failure of such enterprises. The potential for future success
must be considered in light of the problems, expenses, difficulties,
complications and delays encountered in connection with the development of a
business in general. There is no history upon which to base any assumption as to
the likelihood that we will prove successful, and there can be no assurance that
we will generate significant operating revenues in the future or ever achieve
profitable operations.
WE HAVE NO FORMAL WRITTEN AGREEMENT FOR A BUSINESS COMBINATION OR OTHER
TRANSACTION AND THERE CAN BE NO ASSURANCE THAT WE WILL BE ABLE TO SUCCESSFULLY
IDENTIFY AND EVALUATE A SUITABLE BUSINESS OPPORTUNITY.
As at the date of this report, we have no formal written agreement with respect
to acquiring a business opportunity or engaging in a business combination with
any private entity. The success of our company following an entry into any
business opportunity or business combination will depend to a great extent on
the operations, financial condition and management of any identified business
opportunity. While management intends to seek business opportunities and/or
business combinations with entities with established operating histories, there
is no assurance that we will successfully locate business opportunities meeting
such criteria. In the event that we complete a business combination or otherwise
acquire a business opportunity, the success of our operations may be dependent
upon management of the successor firm or venture partner firm, together with a
number of other factors beyond our control.
AS THERE ARE A LARGE NUMBER OF ESTABLISHED AND WELL-FINANCED ENTITIES ACTIVELY
SEEKING SUITABLE BUSINESS OPPORTUNITIES AND BUSINESS COMBINATIONS, WE ARE AT A
COMPETITIVE DISADVANTAGE IN IDENTIFYING AND COMPLETING SUCH OPPORTUNITIES.
We are, and will continue to be, an insignificant participant seeking a suitable
business opportunity or business combination. A large number of established and
well-financed entities, including venture capital firms, are active in seeking
suitable business opportunities or business combinations which may also be
desirable target candidates for our company. Virtually all such entities have
significantly greater financial resources, technical expertise and managerial
capabilities than our company. Consequently, we are at a competitive
disadvantage in identifying possible business opportunities and completing a
business combination. In addition, we will also compete with numerous other
small public companies seeking suitable business opportunities or business
combinations.
UPON COMPLETION OF A BUSINESS OPPORTUNITY OR COMBINATION, THERE CAN BE NO
ASSURANCE THAT WE WILL BE ABLE TO SUCCESSFULLY MANAGE OR ACHIEVE GROWTH OF THAT
BUSINESS OPPORTUNITY OR COMBINATION.
Our ability to achieve growth upon the acquisition of a suitable business
opportunity or business combination will be dependent upon a number of factors
including our ability to hire and train management and other employees and the
adequacy of our financial resources. There can be no assurance that we will be
able to successfully manage any business opportunity or business combination.
Failure to manage anticipated growth effectively and efficiently could have a
material adverse effect on our company.
IF WE COMPLETE A BUSINESS OPPORTUNITY OR COMBINATION, MANAGEMENT OF OUR COMPANY
MAY BE REQUIRED TO SELL OR TRANSFER COMMON SHARES AND RESIGN AS MEMBERS OF OUR
BOARD OF DIRECTORS.
A business combination or acquisition of a business opportunity involving the
issuance of our common shares may result in new shareholders obtaining a
controlling interest in our company. Any such business combination or
acquisition of a business opportunity may require management of our company to
sell or transfer all or a portion of the shares they hold in our company and
5
require such individuals to resign as members of our board. The resulting change
in control of our company could result in the removal of one or more of our
present officers and directors and a corresponding reduction in or elimination
of their participation in the future affairs of our company.
IF WE COMPLETE A BUSINESS OPPORTUNITY OR COMBINATION, WE MAY BE REQUIRED TO
ISSUE A SUBSTANTIAL NUMBER OF COMMON SHARES WHICH WOULD DILUTE THE SHAREHOLDINGS
OF OUR CURRENT SHAREHOLDERS AND RESULT IN A CHANGE OF CONTROL OF OUR COMPANY.
We may pursue the acquisition of a business opportunity or a business
combination with a private company. The likely result of such a transaction
would result in our company issuing common shares to shareholders of such
private company. Issuing previously authorized and unissued common shares in the
capital of our company will reduce the percentage of common shares owned by
existing shareholders and may result in a change in the control of our company
and our management.
OUR COMMON STOCK IS ILLIQUID AND SHAREHOLDERS MAY BE UNABLE TO SELL THEIR
SHARES.
There is currently a limited market for our common stock and we can provide no
assurance to investors that a market will develop. If a market for our common
stock does not develop, our shareholders may not be able to re-sell the shares
of our common stock that they have purchased and they may lose all of their
investment. Public announcements regarding our company, changes in government
regulations, conditions in our market segment or changes in earnings estimates
by analysts may cause the price of our common shares to fluctuate substantially.
These fluctuations may adversely affect the trading price of our common shares.
WE MAY BE UNSUCCESSFUL AT IDENTIFYING, ACQUIRING AND OPERATING SUITABLE BUSINESS
OPPORTUNITIES AND IF WE ARE UNABLE TO FIND, ACQUIRE OR OPERATE A SUITABLE
OPPORTUNITY FOR OUR COMPANY, WE MAY NEVER ACHIEVE PROFITABLE OPERATIONS.
We may not be able to find the right business opportunity for our company to
become engaged in or we may not succeed in becoming engaged in the business
opportunity we choose because we may not act fast enough or have enough money or
other attributes to attract the new business opportunity. Before we begin to
have any significant operations, we will have to become involved in a viable
business opportunity. In addition, in order to be profitable, we will have to,
among other things, hire consultants and employees, develop products and/or
services, market our products/services, ensure supply and develop a customer
base. There is no assurance that we will be able to identify, negotiate, acquire
and develop a business opportunity and we may never be profitable.
RISKS RELATING TO OUR COMMON STOCK
WE HAVE NOT PAID ANY DIVIDENDS AND DO NOT FORESEE PAYING DIVIDENDS IN THE
FUTURE.
Payment of dividends on our common stock is within the discretion of the board
of directors and will depend upon our future earnings, our capital requirements,
financial condition and other relevant factors. We have no plan to declare any
dividends in the foreseeable future.
OUR STOCK IS A PENNY STOCK. TRADING OF OUR STOCK MAY BE RESTRICTED BY THE SEC'S
PENNY STOCK REGULATIONS AND THE FINRA'S SALES PRACTICE REQUIREMENTS, WHICH MAY
LIMIT A STOCKHOLDER'S ABILITY TO BUY AND SELL OUR STOCK.
Our stock is a penny stock. The Securities and Exchange Commission has adopted
Rule 15g-9 which generally defines "penny stock" to be any equity security that
has a market price (as defined) less than $5.00 per share or an exercise price
of less than $5.00 per share, subject to certain exceptions. Our securities are
covered by the penny stock rules, which impose additional sales practice
requirements on broker-dealers who sell to persons other than established
customers and "accredited investors". The term "accredited investor" refers
generally to institutions with assets in excess of $5,000,000 or individuals
with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or
$300,000 jointly with their spouse. The penny stock rules require a
broker-dealer, prior to a transaction in a penny stock not otherwise exempt from
the rules, to deliver a standardized risk disclosure document in a form prepared
6
by the SEC which provides information about penny stocks and the nature and
level of risks in the penny stock market. The broker-dealer also must provide
the customer with current bid and offer quotations for the penny stock, the
compensation of the broker-dealer and its salesperson in the transaction and
monthly account statements showing the market value of each penny stock held in
the customer's account. The bid and offer quotations, and the broker-dealer and
salesperson compensation information, must be given to the customer orally or in
writing prior to effecting the transaction and must be given to the customer in
writing before or with the customer's confirmation. In addition, the penny stock
rules require that prior to a transaction in a penny stock not otherwise exempt
from these rules, the broker-dealer must make a special written determination
that the penny stock is a suitable investment for the purchaser and receive the
purchaser's written agreement to the transaction. These disclosure requirements
may have the effect of reducing the level of trading activity in the secondary
market for the stock that is subject to these penny stock rules. Consequently,
these penny stock rules may affect the ability of broker-dealers to trade our
securities. We believe that the penny stock rules discourage investor interest
in, and limit the marketability of, our common stock.
In addition to the "penny stock" rules promulgated by the Securities and
Exchange Commission, the Financial Industry Regulatory Authority has adopted
rules that require that in recommending an investment to a customer, a
broker-dealer must have reasonable grounds for believing that the investment is
suitable for that customer. Prior to recommending speculative low priced
securities to their non-institutional customers, broker-dealers must make
reasonable efforts to obtain information about the customer's financial status,
tax status, investment objectives and other information. Under interpretations
of these rules, the National Association of Securities Dealers believes that
there is a high probability that speculative low-priced securities will not be
suitable for at least some customers. The National Association of Securities
Dealers' requirements make it more difficult for broker-dealers to recommend
that their customers buy our common stock, which may limit your ability to buy
and sell our stock.
ITEM 2. PROPERTIES
EXECUTIVE OFFICES
Our executive offices are located at 36 McLean Street, Red Bank, NJ 07701. Ms.
Lisa Guise, our sole director and officer, currently provides this space to us
free of charge. This space may not be available to us free of charge in the
future. We do not own any real property.
ITEM 3. LEGAL PROCEEDINGS
We know of no material, active or pending legal proceedings against our company,
nor are we involved as a plaintiff in any material proceeding or pending
litigation. There are no proceedings in which any of our directors, officers or
affiliates, or any registered or beneficial shareholder, is an adverse party or
has a material interest adverse to our interest.
ITEM 4. MINE SAFETY DISCLOSURES
None.
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PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES
MARKET FOR SECURITIES
Our common shares are quoted on the Over-The-Counter Bulletin Board under the
trading symbol "BRRY.OB". Our shares have been quoted on the Over-The-Counter
Bulletin Board since February 17, 2011. There have been no trades in our shares
of common stock since February 27, 2011.
Our transfer agent is Island Stock Transfer, of 100 2nd Avenue, S, Suite 104N,
St. Petersburg, FL 33701; telephone number 727.289.0010; facsimile:
727.289.0069.
HOLDERS OF OUR COMMON STOCK
As of June 30, 2012, there were 34 registered stockholders holding 5,950,000
shares of our issued and outstanding common stock.
DIVIDEND POLICY
There are no restrictions in our articles of incorporation or bylaws that
prevent us from declaring dividends. The Nevada Revised Statutes, however, do
prohibit us from declaring dividends where, after giving effect to the
distribution of the dividend:
1. We would not be able to pay our debts as they become due in the usual
course of business; or
2. Our total assets would be less than the sum of our total liabilities
plus the amount that would be needed to satisfy the rights of
shareholders who have preferential rights superior to those receiving
the distribution.
We have not declared any dividends and we do not plan to declare any dividends
in the foreseeable future.
RECENT SALES OF UNREGISTERED SECURITIES
We did not issue any securities without registration pursuant to the Securities
Act of 1933 during the year ended June 30, 2012.
PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
We did not purchase any of our shares of common stock or other securities during
our fiscal year ended June 30, 2012.
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS
We do not have any equity compensation plans.
ITEM 6. SELECTED FINANCIAL DATA
Not Applicable.
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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATION
The following discussion should be read in conjunction with our audited
financial statements and the related notes that appear elsewhere in this annual
report. The following discussion contains forward-looking statements that
reflect our plans, estimates and beliefs. Our actual results could differ
materially from those discussed in the forward looking statements. Factors that
could cause or contribute to such differences include those discussed below and
elsewhere in this annual report.
Our audited consolidated financial statements are stated in United States
dollars and are prepared in accordance with United States generally accepted
accounting principles.
PLAN OF OPERATION
We are a development stage company that has not yet generated or realized any
revenues from our business operations. On July 8, 2010 the Company signed an
exclusive dealership agreement with Wireless Wipes, a New York corporation that
manufactures a sanitizing wipe used to clean cell phones and other mobile
devices. The agreement granted the Company the exclusive right to purchase,
inventory, promote and resell the product within Canada under certain minimum
order rules. The agreement required an annual distribution of 10,000 pouches of
product. The Company was unable to generate the required annual sales and the
agreement lapsed. The Company is seeking new business opportunities.
We are currently seeking business opportunities with established business
entities for the merger of a target business with our company. In certain
instances, a target business may wish to become a subsidiary of us or may wish
to contribute assets to us rather than merge. We are currently in negotiations
with several parties to enter into a business opportunity but we have not
entered into any definitive agreements to date and there can be no assurance
that we will be able to enter into any definitive agreements. We anticipate that
any new acquisition or business opportunities by our company will require
additional financing. There can be no assurance, however, that we will be able
to acquire the financing necessary to enable us to pursue our plan of operation.
If our company requires additional financing and we are unable to acquire such
funds, our business may fail.
Even if we are able to enter into a business opportunity and obtain the
necessary funding, there is no assurance that any revenues would be generated by
us or that revenues generated would be sufficient to provide a return to
investors.
ANTICIPATED CASH REQUIREMENTS
We anticipate that we will incur the following expenses over the next twelve
months:
1. $10,000 in connection with our company locating, evaluating and
negotiating potential business opportunities;
2. $10,000 for operating expenses, including professional legal and
accounting expenses associated with our company being a reporting
issuer under the Securities Exchange Act of 1934; and
We will incur additional expenses if we are successful in entering into an
agreement to acquire an interest in a business opportunity. If we acquire any
property interests, we will require significant funds to develop the property in
addition to any acquisition costs. It is not possible to estimate such funding
requirements until such time as we enter into a definitive agreement to acquire
an interest in a property or enter into a business combination.
We require a minimum of approximately $20,000 to proceed with our plan of
operation over the next twelve months, exclusive of any acquisition or
development costs. This amount may also increase if we are required to carry out
due diligence investigations in regards to any prospective property or business
opportunity or if the costs of negotiating the applicable transaction are
greater than anticipated. As we had cash in the amount of $1,794 as of June 30,
9
2012, we do not have sufficient working capital to enable us to carry out our
stated plan of operation for the next twelve months. We plan to complete private
placement sales of our common stock in order to raise the funds necessary to
pursue our plan of operation and to fund our working capital deficit in order to
enable us to pay our accounts payable and accrued liabilities. We currently do
not have any arrangements in place for the completion of any private placement
financings and there is no assurance that we will be successful in completing
any private placement financings.
RESULTS OF OPERATIONS
The following summary of our results of operations should be read in conjunction
with our audited financial statements for the year ended June 30, 2012 which are
included herein.
Our operating results for the years ended June 30, 2012 and 2011 are summarized
as follows:
Years Ended
June 30,
------------------------
2012 2011
-------- --------
Revenue $ -- $ --
Operating Expenses 18,885 33,136
Net Loss $ 18,885 $ 33,136
Our operating results for the three months ended June 30, 2012 and 2011 are
summarized as follows:
Three Months Ended
June 30,
------------------------
2012 2011
-------- --------
Revenue $ -- $ --
Operating Expenses 982 6,831
Net Loss $ 982 $ 6,831
REVENUES
On July 8, 2010 the Company signed an exclusive dealership agreement with
Wireless Wipes, a New York corporation that manufactures a sanitizing wipe used
to clean cell phones and other mobile devices. The agreement granted the Company
the exclusive right to purchase, inventory, promote and resell the product
within Canada under certain minimum order rules. The agreement required an
annual distribution of 10,000 pouches of product. The Company was unable to
generate the required annual sales and the agreement lapsed. The Company is
seeking new business opportunities. We have not earned any revenues to date, and
do not anticipate earning revenues until such time as we are able to enter into
a business opportunity.
10
EXPENSES
Our expenses for the years ended June 30, 2011 and 2010 are outlined in the
table below:
Years Ended
June 30,
------------------------
2012 2011
-------- --------
Professional Fees $ 11,578 $ 10,720
Other Selling General & Administrative 7,307 22,434
-------- --------
TOTAL EXPENSES $ 18,885 $ 33,136
======== ========
Our expenses for the three months ended June 30, 2012 and 2011 are outlined in
the table below:
Three Months Ended
June 30,
------------------------
2012 2011
-------- --------
Professional Fees $ -- $ 250
Other Selling General & Administrative 982 6,581
-------- --------
TOTAL EXPENSES $ 982 $ 6,831
======== ========
PROFESSIONAL FEES
Professional fees include our accounting and auditing expenses incurred in
connection with the preparation and audit of our financial statements and
professional fees that we pay to our legal counsel. Our accounting and auditing
expenses were incurred in connection with the preparation of our audited
financial statements and unaudited interim financial statements and our
preparation and filing of a registration statement with the SEC. Our legal
expenses represent amounts paid to legal counsel in connection with our
corporate organization.
OTHER SELLING GENERAL & ADMINISTRATIVE
The decrease in our Selling General & Administrative Expenses between June 30,
2012 and June 30, 2011 is associated with the Company's current limited
operations.
11
LIQUIDITY AND CAPITAL RESOURCES
WORKING CAPITAL
As At As At Percentage
June 30, June 30, Increase/
2012 2011 (Decrease)
---- ---- ----------
Current Assets $ 1,794 $10,695 (84%)
Current Liabilities $ -- $ -- N/A
Working Capital $ 1,794 $10,695 (84%)
CASH FLOWS
Year Ended Year Ended Percentage
June 30, June 30, Increase/
2012 2011 (Decrease)
---- ---- ----------
Cash used in Operating Activities $(11,385) $(38,788) (71%)
Cash provided by Investing Activities $ -- $ -- N/A
Cash provided by Financing Activities $ 7,484 $ -- 100%
Foreign Exchange Effect on Cash $ -- $ (78) (100%)
Net Increase (Decrease) in Cash $ (3,901) $(38,866) (90%)
We anticipate that we will incur approximately $20,000 for operating expenses,
including professional, legal and accounting expenses associated with our
reporting requirements under the Exchange Act during the next twelve months.
Accordingly, we will need to obtain additional financing in order to complete
our business plan.
CASH USED IN OPERATING ACTIVITIES
We used cash in operating activities in the amount of $3,901 during the year
ended June 30, 2012 and $38,866 during the year ended June 30, 2011. Cash used
in operating activities was funded by cash from financing activities.
CASH FROM INVESTING ACTIVITIES
No cash was used or provided in investing activities during the years ended June
30, 2012 and June 30, 2011.
CASH FROM FINANCING ACTIVITIES
We generated $7,484 in cash from financing activities during the year ended June
30, 2012 and $0 for the year ended June 30, 2011.
GOING CONCERN
The financial statements accompanying this report have been prepared on a going
concern basis, which implies that our company will continue to realize its
assets and discharge its liabilities and commitments in the normal course of
business. Our company has not generated 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 our company as a going
concern is dependent upon the continued financial support from our shareholders,
the ability of our company to obtain necessary equity financing to achieve our
operating objectives, and the attainment of profitable operations. As at June
30, 2012, our company has accumulated losses of $57,690 since inception. We do
not have sufficient working capital to enable us to carry out our stated plan of
operation for the next twelve months. These financial statements do not include
any adjustments to the recoverability and classification of recorded asset
amounts and classification of liabilities that might be necessary should our
company be unable to continue as a going concern.
12
Due to the uncertainty of our ability to meet our current operating expenses and
the capital expenses noted above in their report on the financial statements for
the year ended June 30, 2012, our independent auditors included an explanatory
paragraph regarding concerns about our ability to continue as a going concern.
Our financial statements contain additional note disclosures describing the
circumstances that lead to this disclosure by our independent auditors.
The continuation of our business is dependent upon us raising additional
financial support. The issuance of additional equity securities by us could
result in a significant dilution in the equity interests of our current
stockholders. Obtaining commercial loans, assuming those loans would be
available, will increase our liabilities and future cash commitments.
FUTURE FINANCINGS
We anticipate continuing to rely on equity sales of our common shares in order
to continue to fund our business operations. Issuances of additional shares will
result in dilution to our existing stockholders. There is no assurance that we
will achieve any additional sales of our equity securities or arrange for debt
or other financing to fund our planned activities. Lisa Guise has agreed to
provide loans to a minimal amount to carry on our legal, accounting and
reporting needs.
OFF-BALANCE SHEET ARRANGEMENTS
We have no significant off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on our financial condition,
changes in financial condition, revenues or expenses, results of operations,
liquidity, capital expenditures or capital resources that are material to
stockholders.
APPLICATION OF CRITICAL ACCOUNTING ESTIMATES
The financial statements of our company have been prepared in accordance with
generally accepted accounting principles in the United States. Because a precise
determination of many assets and liabilities is dependent upon future events,
the preparation of financial statements for a period necessarily involves the
use of estimates which have been made using careful judgment.
13
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To: The Board of Directors and Stockholders
Berry Only Inc.
Toronto, Ontario, Canada
I have audited the accompanying balance sheet of Berry Only Inc. as of June 30,
2012 and 2011 and the related statements of operations, shareholders' deficit
and cash flows for the period then ended, and for the period since inception,
June 24, 2009, to June 30, 2012. These financial statements are the
responsibility of the Company's management. My responsibility is to express an
opinion on these financial statements based on my audit.
I conducted my audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that I plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. I believe that my audit provides a reasonable
basis for my opinion.
In my opinion the financial statements referred to above present fairly, in all
material respects, the financial position of Berry Only Inc. as of June 30, 2012
and 2011 and the results of its operations and its cash flows for the years then
ended, and the period from inception, June 24, 2009, to June 30, 2012 in
conformity with United States generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern, which contemplates the realization of
assets and liquidation of liabilities in the normal course of business. As
discussed in Note 2 to the financial statements, the Company has no revenue and
incurred a loss in each of its initial three years. This raises substantive
doubt about the Company's ability to continue as a going concern. Management's
plans in regard to these matters are also described in Note 2. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
The Company has determined that it is not required to have, nor was I engaged to
perform, an audit of the effectiveness of its documented internal controls over
financial reporting.
/s/ John Kinross-Kennedy
-------------------------------------
John Kinross-Kennedy
Certified Public Accountant
Irvine, California
September 26, 2012
14
BERRY ONLY INC.
(A Development Stage Company)
Balance Sheet
As at June 30,
--------------------------------------------------------------------------------
2012 2011
-------- --------
ASSETS
CURRENT ASSETS
Cash and Cash Equivalents $ 1,794 $ 5,695
Account receivable -- 5,000
-------- --------
TOTAL ASSETS $ 1,794 $ 10,695
======== ========
LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts Payable $ 2,500 $ --
Due to Officer 7,484 --
-------- --------
TOTAL LIABILITIES 9,984 --
-------- --------
STOCKHOLDERS' EQUITY
Preferred Stock, $0.001 par value, 5,000,000 shares authorized;
none outstanding as at June 30, 2012 and 2011 -- --
Common Stock, $0.001 par value, 75,000,000 shares authorized,
3,944,000 issued and outstanding as at June 30, 2012,
5,950,000 issued and outstanding as at June 30, 2011 3,944 5,950
Additional paid-in capital 45,556 43,550
Accumulated other income (loss) (87) (87)
Deficit (57,603) (38,718)
-------- --------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (8,190) 10,695
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 1,794 $ 10,695
======== ========
The accompanying notes are an integral part of these financial statement.
15
BERRY ONLY INC.
(A Development Stage Company)
Statement of Operations and Comprehensive Loss
--------------------------------------------------------------------------------
For the period
For the three months ended For the year ended June 24, 2009
June 30, June 30, (inception) to
-------------------------- --------------------------- June 30,
2012 2011 2012 2011 2012
---------- ---------- ---------- ---------- ----------
REVENUES $ -- $ -- $ -- $ -- $ --
---------- ---------- ---------- ---------- ----------
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Professional Fees -- 250 11,578 10,702 26,712
Other Selling General & Administrative 982 6,581 7,307 22,434 30,891
---------- ---------- ---------- ---------- ----------
TOTAL EXPENSES (982) 6,831 18,885 33,136 57,603
---------- ---------- ---------- ---------- ----------
Operating Loss (982) (6,831) (18,885) (33,136) (57,603)
---------- ---------- ---------- ---------- ----------
NET INCOME (LOSS) (982) (6,831) (18,885) (33,136) (57,603)
Currency translation adjustment -- -- -- (78) (87)
---------- ---------- ---------- ---------- ----------
COMPREHENSIVE LOSS $ (982) $ (6,831) $ (18,885) $ (33,214) $ (57,690)
========== ========== ========== ========== ==========
NET INCOME (LOSS) PER SHARE,
BASIC AND DILUTED $ (0.00) $ (0.00) $ (0.00) $ (0.00)
========== ========== ========== ==========
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING, BASIC AND DILUTED 3,944,000 5,950,000 3,135,803 5,950,000
---------- ---------- ---------- ----------
The accompanying notes are an integral part of these financial statement.
16
BERRY ONLY INC.
(A Development Stage Company)
Statement of Changes in Stockholders' Equity
For the period from Inception, June 24, 2009, to June 30, 2012
--------------------------------------------------------------------------------
Accumulated
Common Stock Additional Other
----------------------- Paid-in Comprehensive
Shares Amount Capital Income/(Loss) Deficit Total
------ ------ ------- ------------- ------- -----
BALANCES AT INCEPTION,
JUNE 24, 2009 -- $ -- $ -- $ -- $ -- $ --
---------- -------- -------- ------- -------- -------
Net income (loss) for the
period ended June 30, 2009 -- -- --
---------- -------- -------- ------- -------- -------
BALANCES AT JUNE 30, 2009 -- -- -- -- -- --
---------- -------- -------- ------- -------- -------
August 26, 2009: Common stock
issued for cash at $0.005
per share 2,000,000 2,000 8,000 10,000
March-May, 2010: Common stock
issued for cash at $0.01
per share 2,950,000 2,950 26,550 29,500
April 29, 2010: Common stock
issued for cash at $0.01
per share 1,000,000 1,000 9,000 10,000
Net loss, year ended
June 30, 2010 (9) (5,582) (5,591)
---------- -------- -------- ------- -------- -------
BALANCES AT JUNE 30, 2010 5,950,000 5,950 43,550 (9) (5,582) 43,909
---------- -------- -------- ------- -------- -------
Net loss, year ended
June 30, 2011 (78) (33,136) (33,214)
---------- -------- -------- ------- -------- -------
BALANCES AT JUNE 30, 2011 5,950,000 5,950 43,550 (87) (38,718) 10,695
---------- -------- -------- ------- -------- -------
October 24, 2011: Commons stock
surrendered and cancelled (2,006,000) (2,006) 2,006 --
Net loss, year ended
June 30, 2012 -- (18,885) (18,885)
---------- -------- -------- ------- -------- -------
BALANCES AT JUNE 30, 2012 3,944,000 $ 3,944 $ 45,556 $ (87) $(57,603) $(8,190)
========== ======== ======== ======= ======== =======
17
The accompanying notes are an integral part of these financial statement.
18
BERRY ONLY INC.
(A Development Stage Company)
Statement of Cash Flows
--------------------------------------------------------------------------------
For the period
For the three months ended For the year ended June 24, 2009
June 30, June 30, (inception) to
------------------------ ---------------------- June 30,
2012 2011 2012 2011 2012
-------- -------- -------- -------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss) $ (982) $ (6,831) $(18,885) $(33,136) $(57,603)
Adjustments to reconcile net loss to
net cash used by operating activities: -- -- -- -- --
Changes in operating assets and liabilities:
Accounts receivable -- (5,000) 5,000 (5,000) --
Accounts payable -- -- 2,500 (652) 2,500
-------- -------- -------- -------- --------
NET CASH USED IN OPERATING ACTIVITIES (982) (11,831) (11,385) (38,788) (55,103)
-------- -------- -------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
NET CASH USED IN INVESTING ACTIVITIES -- -- -- -- --
-------- -------- -------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds of loan from officer -- -- 7,484 -- 7,484
Sale of stock for cash -- -- -- -- 49,500
-------- -------- -------- -------- --------
NET CASH PROVIDED BY FINANCING ACTIVITIES -- -- 7,484 -- 56,984
-------- -------- -------- -------- --------
EFFECTS OF EXCHANGE RATES ON CASH -- -- -- (78) (87)
-------- -------- -------- -------- --------
NET INCREASE/(DECREASE) IN CASH (982) (3,901) (38,866) 1,794
Cash at beginning of period 2,776 17,526 5,695 44,561 --
-------- -------- -------- -------- --------
CASH AT END OF PERIOD $ 1,794 $ 5,695 $ 1,794 $ 5,695 $ 1,794
======== ======== ======== ======== ========
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid $ -- $ -- $ -- $ --
-------- -------- -------- --------
Income Taxes paid $ -- $ -- $ -- $ --
-------- -------- -------- --------
The accompanying notes are an integral part of these financial statement.
19
BERRY ONLY INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2012
(Expressed in Us Dollars)
--------------------------------------------------------------------------------
NOTE 1 BASIS OF PRESENTATION AND NATURE OF OPERATIONS
ORGANIZATION
Berry Only Inc. ("the Company") was incorporated in the State of Nevada on June
24, 2009. The Company was incorporated for the purpose of marketing and
distributing a sanitizing product for mobile phones and other mobile devices.
CURRENT BUSINESS OF THE COMPANY
On July 8, 2010 the Company signed an exclusive dealership agreement with
Wireless Wipes, a New York corporation that manufactures a sanitizing wipe used
to clean cell phones and other mobile devices. The agreement granted the Company
the exclusive right to purchase, inventory, promote and resell the product
within Canada under certain minimum order rules. The agreement required an
annual distribution of 10,000 pouches of product. The Company was unable to
generate the required annual sales and the agreement lapsed. The Company is
seeking new business opportunities.
NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CASH AND CASH EQUIVALENTS
The Company considers all liquid investments with a maturity of three months or
less from the date of purchase that are readily convertible into cash to be cash
equivalents.
PROPERTY & EQUIPMENT
Capital assets are stated at cost. Depreciation of equipment is provided using
the straight-line method over the estimated useful lives of the assets.
Expenditures for maintenance and repairs are charged to expense as incurred. The
Company did not have any property & equipment at June 30, 2012 and 2011.
LONG-LIVED ASSETS
The Company accounts for long-lived assets under the FASB (Financial Accounting
Standards Board) ASC (Accounting Standard Codification) 340-10 OTHER ASSETS AND
DEFERRED COSTS, (SFAS 142 and 144: "ACCOUNTING FOR GOODWILL AND OTHER INTANGIBLE
ASSETS" and "ACCOUNTING FOR IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS") . In
accordance with ASC 340-10, long-lived assets, goodwill and certain identifiable
intangible assets held and used by the Company are reviewed for impairment
whenever events or changes in circumstances indicate that the carrying amount of
an asset will not be recoverable. For purposes of evaluating the recoverability
of long-lived assets, goodwill and intangible assets, the recoverability test is
performed using undiscounted net cash flows related to the long-lived assets.
Impairment of experimental water clarification equipment is calculated based on
its estimated useful life.
20
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles 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.
INCOME TAXES
The Company utilizes FASB ACS 740, "Income Taxes," which requires the
recognition of deferred tax assets and liabilities for the expected future tax
consequences of events that have been included in the financial statements or
tax returns. Under this method, deferred tax assets and liabilities are
determined based on the difference between the tax basis of assets and
liabilities and their financial reporting amounts based on enacted tax laws and
statutory tax rates applicable to the periods in which the differences are
expected to affect taxable income. A valuation allowance is recorded when it is
"more likely-than-not" that a deferred tax asset will not be realized.
The Company generated a deferred tax credit through net operating loss
carryforward. However, a valuation allowance of 100% has been established. The
Company has a Net Operating Loss of approximately $57,603 as at June 30, 2012,
which begins to expire in 2029 unless utilized beforehand. The Company generated
a deferred tax credit through the net operating loss carry-forward. However, a
valuation allowance of 100% has been established.
Interest and penalties on tax deficiencies recognized in accordance with ASC
accounting standards are classified as income taxes in accordance with ASC Topic
740-10-50-19.
FOREIGN CURRENCY TRANSLATION
In accordance with FASB ASC 830-20 FOREIGN CURRENCY TRANSACTIONS, (SFAS No. 52
"FOREIGN CURRENCY TRANSLATION"), the Company has determined that its functional
currency is the United States Dollar. The Company recorded a foreign currency
loss of $ 87.00 in the year ended June 30, 2012. Exchange differences since
inception are accumulated as a component of accumulated other comprehensive gain
(loss).
COMPREHENSIVE INCOME (LOSS)
Comprehensive income or loss encompasses net income or loss and "other
comprehensive income or loss", which includes all other non-owner transactions
and events that change shareholders' equity/deficiency. The Company's other
comprehensive gain reflects the effect of foreign currency translation
adjustments on the translation of the financial statements from the functional
currency of Canadian dollars into the reporting currency of U.S. dollars.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The Financial Accounting Standards Board issued ASC (Accounting Standards
Codification) 820-10 (SFAS No. 157), "FAIR VALUE MEASUREMENTS AND DISCLOSURES"
for financial assets and liabilities. ASC 820-10 provides a framework for
measuring fair value and requires expanded disclosures regarding fair value
measurements. FASB ASC 820-10 defines fair value as the price that would be
received for an asset or the exit price that would be paid to transfer a
21
liability in the principal or most advantageous market in an orderly transaction
between market participants on the measurement date. FASB ASC 820-10 also
establishes a fair value hierarchy which requires an entity to maximize the use
of observable inputs, where available. The following summarizes the three levels
of inputs required by the standard that the Company uses to measure fair value:
* Level 1: Quoted prices in active markets for identical assets or
liabilities
* Level 2: Observable inputs other than Level 1 prices such as quoted
prices for similar assets or liabilities; quoted prices in markets
that are not active or other inputs that are observable or can be
corroborated by observable market data for substantially the full term
of the related assets or liabilities.
* Level 3: Unobservable inputs that are supported by little or no market
activity and that are significant to the fair value of the assets or
liabilities.
The carrying amounts of the Company's financial instruments as of June 30, 2012
were valued according to the following inputs:
Observable
Inputs
Other Than Unobservable
Observable Level 1 Inputs,
Inputs Prices Significant Total
------ ------ ----------- -----
Level 1 Level 2 Level 3
Cash and Cash Equivalents $ 1,794 $ -- $ 1,794
Accounts Receivable
Accounts Payable
Shareholders' Loan 7,484 7,484
-------- -------- -------- --------
$ 1,794 7,484 $ 9,278
======== ======== ======== ========
BASIC AND DILUTED EARNINGS PER SHARE
Net loss per share is calculated in accordance with FASB ASC 260, EARNINGS PER
SHARE, for the period presented. ASC 260 requires presentation of basic earnings
per share and diluted earnings per share. Basic income (loss) per share ("Basic
EPS") is computed by dividing net loss available to common stockholders by the
weighted average number of common shares outstanding during the period. Diluted
earnings per share ("Diluted EPS") is similarly calculated. Dilution is computed
by applying the treasury stock method. Under this method, options and warrants
are assumed to be exercised at the beginning of the period (or at the time of
issuance, if later), and as if funds obtained thereby were used to purchase
common stock at the average market price during the period. As at June 30, 2012,
there were no potentially dilutive securities.
The following is a reconciliation of the numerators and denominators of the
basic and diluted earnings per share computations for the year and period ended
June 30, 2012 and 2011:
22
2012 2011
---- ----
Numerator:
Basic and diluted net loss per share:
Net Loss $ (18,885) $ (33,214)
Denominator:
Basic and diluted weighted average
number of shares outstanding 3,944,000 5,950,000
Basic and Diluted Net Loss Per Share: $ (0.01) $ (0.00)
REVENUE RECOGNITION
The Company's revenue recognition policies are in compliance with ASC 605-13
(Staff accounting bulletin (SAB) 104). Sales revenue is recognized at the date
of shipment to customers when a formal arrangement exists, the price is fixed or
determinable, the delivery is completed, no other significant obligations of the
Company exist and collectability is reasonably assured. There were no sales in
the fiscal years ended June 30, 2012 and 2011
RECENT ACCOUNTING PRONOUNCEMENTS
COMPREHENSIVE INCOME -- In June 2011, the Financial Accounting Standards Board
("FASB") issued new guidance on the presentation of comprehensive income.
Specifically, the new guidance allows an entity to present components of net
income and other comprehensive income in one continuous statement, referred to
as the statement of comprehensive income, or in two separate, but consecutive
statements. The new guidance eliminates the current option to report other
comprehensive income and its components in the statement of changes in equity.
While the new guidance changes the presentation of comprehensive income, there
are no changes to the components that are recognized in net income or other
comprehensive income under current accounting guidance. This new guidance is
effective for fiscal years and interim periods beginning after December 15,
2011. We do not believe our adoption of the new guidance will have an impact on
our consolidated financial position, results of operations or cash flows.
NOTE 3 UNCERTAINTY OF ABILITY TO CONTINUE AS A GOING CONCERN
The Company's financial statements are prepared using the generally accepted
accounting principles applicable to a going concern, which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. However, the Company has not generated any revenue and has incurred an
accumulated loss of $57,603 in the fiscal year ended June 30, 2012.
Management has taken the following steps to revise its operating and financial
requirements, which it believes are sufficient to provide the Company with the
ability to continue as a going concern. The Company pursued funding through sale
of stock. It has pursued a dealership agreement for its intended product, the
marketing and sales of which is anticipated to be profitable. Management
believes that the above actions will allow the Company to continue operations
through the next fiscal year. However management cannot provide any assurances
that the Company will be successful in its retail operation.
23
Recoverability of a major portion of the recorded asset amounts shown in the
accompanying balance sheets is dependent upon continued operations of the
Company, which in turn is dependent upon the Company's ability to raise
additional capital, obtain financing and to succeed in its future operations. If
the Company is unable to make it profitable, the Company could be forced to
discontinue operations.
The financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or amounts and
classification of liabilities that might be necessary should the Company be
unable to continue as a going concern.
NOTE 4 RELATED ENTITIES TRANSACTIONS
David Guest is president, chief financial officer, and sole director of the
Board of Directors of the Company. He is the controlling shareholder of the
Company, having 50.42% of the outstanding voting shares. He purchased Company
stock for cash as follows:
August 26, 2009 2,000,000 shares $ 10,000
April 29, 2010 1,000,000 shares 10,000
--------- --------
Total 3,000,000 shares $ 20,000
========= ========
NOTE 5 INCOME TAXES
No provision was made for federal income tax for the year ended June 30, 2012
and 2011, since the Company had net operating loss.
Net operating loss carry-forwards may be used to reduce taxable income through
the year 2032. The availability of the Company's net operating loss
carry-forwards are subject to limitation if there is a 50% or more positive
change in the ownership of the Company's stock.
The net operating loss carry-forward for federal and state income tax purposes
is approximately $57,600, generating a Federal deferred tax credit of $8,640 as
of June 30, 2012. An allowance of $8,640 has been established.
NOTE 6 CAPITAL
During the year and period ended June 30, 2011, the company issued the following
common shares:
August 26, 2009: 2,000,000 shares issued for cash at $0.005 per share, realizing
$10,000.
Between March and May, 2010: 2,950,000 shares issued for cash at $0.01 per
share, realizing $29,500.
April 29, 2010: 1,000,000 shares issued for cash at $0.01 per share, realizing
$10,000.
As of June 30, 2011 the Company had authorized 5,000,000 preferred shares of par
value $0.001, of which none was issued and outstanding.
On October 24, 2011 2,006,000 shares of commons stock were surrendered and
cancelled.
As of June 30, 2012 the Company had authorized 75,000,000 shares of common stock
of par value $0.001, of which 3,944,000 shares were issued and outstanding.
24
NOTE 7 SUBSEQUENT EVENTS
Events Subsequent to June 30, 2012 Have Been Evaluated Through September 26,
2012, the Date These Statements Were Available to be Issued, to Determine
Whether They Should be Disclosed to Keep the Financial Statements From Being
Misleading. Management Found No Subsequent Event to be Disclosed.
25
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
We maintain disclosure controls and procedures that are designed to ensure that
information required to be disclosed in our Exchange Act reports is recorded,
processed, summarized and reported within the time periods specified in the
Securities and Exchange Commission's rules and forms and that such information
is accumulated and communicated to our management, including our Chief Executive
Officer and Chief Financial Officer, as appropriate, to allow for timely
decisions regarding required disclosure. In designing and evaluating the
disclosure controls and procedures, management recognizes that any controls and
procedures, no matter how well designed and operated, can provide only
reasonable assurance of achieving the desired control objectives, and management
is required to apply its judgment in evaluating the cost-benefit relationship of
possible controls and procedures. Our disclosure controls and procedures were
designed to provide reasonable assurance that the controls and procedures would
meet their objectives. As required by SEC Rule 13a-15(b), our management carried
out an evaluation, with the participation of our Chief Executive and Chief
Financial Officers, of the effectiveness of the design and operation of our
disclosure controls and procedures as of the end of the period covered by this
report. Based on the foregoing, our Chief Executive Officer and Chief Financial
Officer concluded that our disclosure controls and procedures were effective at
the reasonable assurance level.
MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Management is responsible for establishing and maintaining adequate internal
control over our financial reporting. In order to evaluate the effectiveness of
internal control over financial reporting, as required by Section 404 of the
Sarbanes-Oxley Act, management has conducted an assessment, including testing,
using the criteria in Internal Control -- Integrated Framework, issued by the
Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Our
system of internal control over financial reporting is designed to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. Because of its inherent limitations,
internal control over financial reporting may not prevent or detect
misstatements. Management has used the framework set forth in the report
entitled Internal Control-Integrated Framework published by the Committee of
Sponsoring Organizations of the Treadway Commission, known as COSO, to evaluate
the effectiveness of our internal control over financial reporting. Based on
this assessment, management has concluded that our internal control over
financial reporting was effective as of June 30, 2012.This Annual Report does
not include an attestation report of our independent registered public
accounting firm regarding internal control over financial reporting. Our
internal control over financial reporting was not subject to attestation by our
independent registered public accounting firm pursuant to temporary rules of the
SEC that permit us to provide only management's report in this Annual Report.
There has been no change in our internal controls over financial reporting
during our most recent fiscal quarter that has materially affected, or is
reasonably likely to materially affect, our internal controls over financial
reporting.
ITEM 9B. OTHER INFORMATION
None.
26
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
DIRECTORS AND EXECUTIVE OFFICERS
As at June 30, 2012, our directors and executive officers, their ages, positions
held, and duration of such, are as follows:
Position Held Date First Elected
Name With the Company Age or Appointed
---- ---------------- --- ------------
Lisa Guise President, Chief Executive 44 November 30, 2011
Officer, Chief Financial
Officer, and Director
BUSINESS EXPERIENCE
The following is a brief account of the education and business experience of
each director and executive officer during at least the past five years,
indicating each person's principal occupation during the period, and the name
and principal business of the organization by which he was employed.
LISA GUISE is our CEO, CFO, President, Secretary, Treasurer and sole director.
Ms. Guise graduated Syracuse University. Ms. Guise received her Bachelor's of
science degree in speech communications in 1991. Over the past few years Ms.
Guise has been an independent business consultant. Her experience includes
working with management of privately-held companies to maximize productivity as
well as general corporate matters. Ms. Guise has experience in various
industries including fitness and transportation.
TERM OF OFFICE
Our directors are appointed for a one-year term to hold office until the next
annual general meeting of our shareholders or until removed from office in
accordance with our bylaws. Our officers are appointed by our board of directors
and hold office until removed by the board.
SIGNIFICANT EMPLOYEES
We have no significant employees other than the director and officer described
above.
FAMILY RELATIONSHIPS
There are no family relationships among our directors or officers.
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
Our directors, executive officers and control persons have not been involved in
any of the following events during the past five years:
1. any bankruptcy petition filed by or against any business of which such
person was a general partner or executive officer either at the time
of the bankruptcy or within two years prior to that time;
2. any conviction in a criminal proceeding or being subject to a pending
criminal proceeding (excluding traffic violations and other minor
offenses);
3. being subject to any order, judgment, or decree, not subsequently
reversed, suspended or vacated, of any court of competent
jurisdiction, permanently or temporarily enjoining, barring,
suspending or otherwise limiting his involvement in any type of
business, securities or banking activities; or
27
4. being found by a court of competent jurisdiction (in a civil action),
the Securities and Exchange Commission or the Commodity Futures
Trading Commission to have violated a federal or state securities or
commodities law, and the judgment has not been reversed, suspended, or
vacated.
AUDIT COMMITTEE
The Company's audit committee is composed of its sole director and officer, Lisa
Guise.
AUDIT COMMITTEE FINANCIAL EXPERT
Our board of directors has determined that it does not have an audit committee
member that qualifies as an "audit committee financial expert" as defined in
Item 407(d)(5)(ii) of Regulation S-K. We believe that the audit committee
members are collectively capable of analyzing and evaluating our financial
statements and understanding internal controls and procedures for financial
reporting. In addition, we believe that retaining an independent director who
would qualify as an "audit committee financial expert" would be overly costly
and burdensome and is not warranted in our circumstances given the early stages
of our development and the fact that we have not generated revenues to date.
ITEM 11. EXECUTIVE COMPENSATION
The particulars of compensation paid to the following persons:
* our principal executive officer;
* our most highly compensated executive officers who were serving as
executive officers at the end of the year ended June 30, 2012; and
* up to two additional individuals for whom disclosure would have been
provided under (b) but for the fact that the individual was not
serving as our executive officer at the end of the most recently
completed financial year, who we will collectively refer to as the
named executive officers, for our years ended June 30, 2011, 2010 and
2009, are set out in the following summary compensation table:
SUMMARY COMPENSATION TABLE
Change in
Pension
Value and
Non-Equity Nonqualified
Name and Incentive Deferred
Principal Stock Option Plan Compensation All Other
Position Year Salary($) Bonus($) Awards($) Awards($) Compensation($) Earnings($) Compensation($) Totals($)
-------- ---- --------- -------- --------- --------- --------------- ----------- --------------- ---------
Lisa Guise 2012 Nil Nil Nil Nil Nil Nil Nil Nil
President,
Chief
Executive
Officer
and Chief
Financial
Officer
David 2011 Nil Nil Nil Nil Nil Nil Nil Nil
Guest(1) 2010 Nil Nil Nil Nil Nil Nil Nil Nil
2009 Nil Nil Nil Nil Nil Nil Nil Nil
----------
(1) David Guest was our president, chief executive officer and chief financial
officer from Inception to November 11, 2011.
28
There are no arrangements or plans in which we provide pension, retirement or
similar benefits for directors or executive officers. Our directors and
executive officers may receive stock options at the discretion of our board of
directors in the future. We do not have any material bonus or profit sharing
plans pursuant to which cash or non-cash compensation is or may be paid to our
directors or executive officers, except that stock options may be granted at the
discretion of our board of directors from time to time. We have no plans or
arrangements in respect of remuneration received or that may be received by our
executive officers to compensate such officers in the event of termination of
employment (as a result of resignation, retirement, change of control) or a
change of responsibilities following a change of control.
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
As at June 30, 2012, we had not adopted any equity compensation plan and no
stock, options, or other equity securities were awarded to our sole executive
officer.
AGGREGATED OPTIONS EXERCISED IN THE YEAR ENDED JUNE 30, 2012 AND YEAR END OPTION
VALUES There were no stock options exercised during the year ended June 30,
2012.
REPRICING OF OPTIONS/SARS
We did not reprice any options previously granted during the year ended June 30,
2012.
DIRECTOR COMPENSATION
We do not pay our directors any fees or other compensation for acting as
directors. We have not paid any fees or other compensation to any of our
directors for acting as directors to date.
EMPLOYMENT CONTRACTS
We presently do not have any employment agreements or other compensation
arrangements with Ms. Guise. Generally, Ms. Guise provides his services on a
part-time basis without compensation. Ms. Guise has agreed not to charge any
management fee during the current period in which we are seeking new business
opportunities.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
As of June 30, 2012, there were 5,950,000 shares of
our common stock outstanding. The following table sets forth certain information
known to us with respect to the beneficial ownership of our common stock as of
that date by (i) each of our directors, (ii) each of our executive officers, and
(iii) all of our directors and executive officers as a group. Except as set
forth in the table below, there is no person known to us who beneficially owns
more than 5% of our common stock.
29
Number of
Title of Class Shares
Directors and Name and Address Beneficially Percentage
Officers: of Beneficial Owner Owned(1) of Class(2)
--------- ------------------- -------- -----------
Common Stock Lisa Guise 3,000,000 50.42%
36 McLean Street
Red Bank, NJ 07701
Common Stock Directors and Officers 3,000,000 50.42%
as a group
----------
(1) Under Rule 13d-3, a beneficial owner of a security includes any person who,
directly or indirectly, through any contract, arrangement, understanding,
relationship, or otherwise has or shares: (i) voting power, which includes
the power to vote, or to direct the voting of shares; and (ii) investment
power, which includes the power to dispose or direct the disposition of
shares. Certain shares may be deemed to be beneficially owned by more than
one person (if, for example, persons share the power to vote or the power
to dispose of the shares). In addition, shares are deemed to be
beneficially owned by a person if the person has the right to acquire the
shares (for example, upon exercise of an option) within 60 days of the date
as of which the information is provided. In computing the percentage
ownership of any person, the amount of shares outstanding is deemed to
include the amount of shares beneficially owned by such person (and only
such person) by reason of these acquisition rights.
(2) The percentage of class is based on 5,950,000 shares of common stock issued
and outstanding as of June 30, 2012.
CHANGES IN CONTROL
We are unaware of any contract or other arrangement the operation of which may
at a subsequent date result in a change of control of our company.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
None of the following parties has, since commencement of our fiscal year ended
June 30, 2012, had any material interest, direct or indirect, in any transaction
with us or in any presently proposed transaction that has or will materially
affect us, in which our company is a participant and the amount involved exceeds
the lesser of $120,000 or 1% of the average of our company's total assets for
the last three completed financial years:
(i) Any of our directors or officers;
(ii) Any person proposed as a nominee for election as a director;
(iii)Any person who beneficially owns, directly or indirectly, shares
carrying more than 5% of the voting rights attached to our outstanding
shares of common stock;
(iv) Any of our promoters; and
(v) Any member of the immediate family (including spouse, parents,
children, siblings and in-laws) of any of the foregoing persons.
30
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
AUDIT FEES
The aggregate fees billed for the two most recently completed fiscal periods
ended June 30, 2012 and June 30, 2011 for professional services rendered by John
Kinross-Kennedy, CPA, for the audit of our annual consolidated financial
statements, quarterly reviews of our interim consolidated financial statements
and services normally provided by the independent accountant in connection with
statutory and regulatory filings or engagements for these fiscal periods were as
follows:
Year Ended Year Ended
June 30, June 30,
2012 2011
------ ------
Audit Fees and Audit Related Fees $2,000 $1,800
Tax Fees -- --
All Other Fees -- --
------ ------
TOTAL $2,000 $1,800
====== ======
In the above table, "audit fees" are fees billed by our company's external
auditor for services provided in auditing our company's annual financial
statements for the subject year. "Audit-related fees" are fees not included in
audit fees that are billed by the auditor for assurance and related services
that are reasonably related to the performance of the audit review of our
company's financial statements. "Tax fees" are fees billed by the auditor for
professional services rendered for tax compliance, tax advice and tax planning.
"All other fees" are fees billed by the auditor for products and services not
included in the foregoing categories.
POLICY ON PRE-APPROVAL BY AUDIT COMMITTEE OF SERVICES PERFORMED BY INDEPENDENT
AUDITORS
The board of directors pre-approves all services provided by our independent
auditors. All of the above services and fees were reviewed and approved by the
board of directors either before or after the respective services were rendered.
The board of directors has considered the nature and amount of fees billed by
John Kinross-Kennedy, CPA. and believes that the provision of services for
activities unrelated to the audit is compatible with maintaining John
Kinross-Kennedy, CPA.
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PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Exhibit
Number Description
------ -----------
3.1 Articles of Incorporation (filed as an exhibit to our Form S-1
Registration Statement, filed on August 17, 2010)
3.2 Bylaws (filed as an exhibit to our Form S-1 Registration Statement,
filed on August 17, 2010)
31.1* Certification of Chief Executive Officer and Chief Financial Officer
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1* Certification of Chief Executive Officer and Chief Financial Officer
pursuant Section 906 Certifications under Sarbanes-Oxley Act of 2002
101** Interactive data files pursuant to Rule 405 of Regulation S-T
----------
* Filed herewith.
** To be filed by Amendment
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
BERRY ONLY INC.
By /s/ Lisa Guise
------------------------------------------
Lisa Guise
President, Secretary, Treasurer, Chief
Executive Officer and Chief Financial
Officer (Principal Executive Officer,
Principal Accounting Officer and
Principal Financial Officer)
Date: October 15, 2012
32