UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 2007
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________________ To ______________________
Commission file number 333-138951
BLINK COUTURE INC.
(Exact name of registrant as specified in its charter)
Delaware | N/A |
(State or other jurisdiction of incorporation | (I.R.S. Employer Identification No.) |
or organization) | |
1199 Marinaside Crescent, Suite 1107 | V6Z 2Y2 |
Vancouver, British Columbia, Canada | |
(Address of principal executive offices) | (Zip Code) |
(604) 623 3309
(Registrants telephone number,
including area code)
Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was require to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [ ] Yes [ x ] No
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [ x ] Yes [] No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Check whether the registrant has filed all documents and reports required to be filed by Sections 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
APPLICABLE ONLY TO CORPORATE ISSUERS
As of June 13, 2007, the registrants outstanding common stock consisted of 20,640,250 shares.
Table of Contents
PART I FINANICAL INFORMATION
ITEM 1. Financial Statements
The unaudited financial statements of Blink Couture Inc. (the Company, Blink, we, our, us) follow. All currency references in this report are in US dollars unless otherwise noted.
Blink Couture Inc.
(Formerly Fashionfreakz
International Inc.)
(A Development Stage Company)
April 30, 2006
(unaudited)
Index | |
Balance Sheets | F1 |
Statements of Operations | F2 |
Statements of Cash Flows | F3 |
Notes to the Financial Statements | F4 |
1
Blink Couture Inc. |
(Formerly Fashionfreakz International Inc.) |
(A Development Stage Company) |
Balance Sheets |
(Unaudited) |
(Expressed in US dollars) |
April 30, | July 31, | |||||
2007 | 2006 | |||||
$ | $ | |||||
ASSETS | ||||||
Current Assets | ||||||
Cash | 13,541 | 40,920 | ||||
Inventory | 1,482 | | ||||
Total Current Assets | 15,023 | 40,920 | ||||
Property and Equipment | 662 | | ||||
Total Assets | 15,685 | 40,920 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY | ||||||
Current Liabilities | ||||||
Accounts Payable | 2,843 | 2,023 | ||||
Accrued Liabilities | 1350 | | ||||
Due to Related Parties (Note 3 (a) and (b)) | 7,866 | 7,698 | ||||
Total Liabilities | 12,059 | 9,721 | ||||
Contingencies and Commitments (Notes 1 and 5) | ||||||
Stockholders Equity | ||||||
Preferred Stock: 20,000,000 shares authorized, $0.0001 par value | ||||||
Nil shares issued and outstanding | | | ||||
Common Stock: 80,000,000 shares authorized, $0.0001 par value | ||||||
20,640,250 and 20,605,500 shares issued and outstanding, respectively | 2,064 | 2,061 | ||||
Additional Paid-in Capital | 48,026 | 41,079 | ||||
Deficit Accumulated During the Development Stage | (46,464 | ) | (11,941 | ) | ||
Total Stockholders Equity | 3,626 | 31,199 | ||||
Total Liabilities and Stockholders Equity | 15,685 | 40,920 |
(The accompanying notes are an integral part of these financial statements)
F-1
Blink Couture Inc. |
(Formerly Fashionfreakz International Inc.) |
(A Development Stage Company) |
Statements of Operations |
(Unaudited) |
(Expressed in US dollars) |
Accumulated from | |||||||||||||||
October 23, 2003 | |||||||||||||||
(Date of Inception) | For the Nine Months Ended | For the Three Months Ended | |||||||||||||
to April 30, | April 30, | April 30, | |||||||||||||
2007 | 2007 | 2006 | 2007 | 2006 | |||||||||||
$ | $ | $ | $ | $ | |||||||||||
Revenue | | | | | | ||||||||||
Expenses | |||||||||||||||
Amortization | 79 | 79 | | 79 | | ||||||||||
General and administrative | 9,190 | 5,056 | 77 | 2,646 | 77 | ||||||||||
Management fees (Note 3(c)) | 9,200 | 1,800 | 1,800 | 600 | 600 | ||||||||||
Marketing | 657 | 657 | | | | ||||||||||
Professional fees | 14,842 | 14,602 | 520 | 1,589 | | ||||||||||
Rent | 467 | 300 | 300 | 100 | 100 | ||||||||||
Web development expenses | 12,029 | 12,029 | | 1,024 | | ||||||||||
Total Expenses | 46,464 | 34,523 | 2,697 | 6,038 | 777 | ||||||||||
Net Loss For the Period | (46,464 | ) | (34,523 | ) | ( 2,697 | ) | ( 6,038 | ) | ( 777 | ) | |||||
Net Loss Per Share Basic and Diluted | | | | | | ||||||||||
Weighted Average Shares Outstanding | 20,635,000 | 20,400,000 | 20,640,000 | 20,400,000 |
(The accompanying notes are an integral part of these financial statements)
F-2
Blink Couture Inc. |
(Formerly Fashionfreakz International Inc.) |
(A Development Stage Company) |
Statements of Cash Flows |
(Unaudited) |
(Expressed in US dollars) |
For the Nine Months Ended | ||||||
April 30 | ||||||
2007 | 2006 | |||||
$ | $ | |||||
Operating Activities | ||||||
Net loss for the period | (34,523 | ) | ( 2,697 | ) | ||
Change in operating assets and liabilities: | ||||||
Accounts payable and accrued liabilities | 2,170 | | ||||
Inventory | (1,482 | ) | | |||
Due to related parties | 168 | 2,789 | ||||
Net Cash Used In Operating Activities | (32,317 | ) | 92 | |||
Investing Activity | ||||||
Purchase of property and equipment | (662 | ) | | |||
Net Cash Used in Investing Activities | (662 | ) | | |||
Financing Activity | ||||||
Proceeds from issuance of common stock | 6,950 | | ||||
Net Cash Flows Provided By Financing Activities | 6,950 | | ||||
(Decrease) Increase in Cash | (27,379 | ) | 92 | |||
Cash - Beginning of Period | 40,920 | | ||||
Cash End of Period | 13,541 | 92 | ||||
Supplemental Disclosures | ||||||
Interest paid | | | ||||
Income taxes paid | | |
(The accompanying notes are an integral part of these financial statements)
F-3
Blink Couture Inc. |
(Formerly Fashionfreakz International Inc.) |
(A Development Stage Company) |
Notes to the Financial Statements |
April 30, 2007 |
1. |
Development Stage Company |
|
Fashionfreakz International Inc. (the Company) was incorporated on October 23, 2003 under the laws of the State of Delaware. On December 2, 2005 Fashionfreakz International Inc. changed its name to Blink Couture Inc. The Company is a Development Stage Company, as defined by Statement of Financial Accounting Standard (SFAS) No. 7 Accounting and Reporting by Development Stage Enterprises . The Companys principal business is specializing online in retailing trendy clothing and accessories produced by independent designers. The Company is in the process of expanding its product line and further developing its website. |
||
These financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company has never 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 the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to continue operations, and the attainment of profitable operations. As at April 30, 2007, the Company has accumulated losses of $45,776 since inception. These factors raise substantial doubt regarding the Companys ability to continue as a going concern. 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 the Company be unable to continue as a going concern. |
||
2. |
Summary of Significant Accounting Policies |
|
a) |
Basis of Presentation |
|
These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. The Companys fiscal year-end is July 31. |
||
b) |
Interim Financial Statements |
|
These interim unaudited financial statements have been prepared on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Companys financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period. |
||
c) |
Use of Estimates |
|
The preparation of financial statements in conformity with US 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. The Company regularly evaluates estimates and assumptions related to inventory reserves and deferred income tax asset valuations. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Companys estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. |
F-4
Blink Couture Inc. |
(Formerly Fashionfreakz International Inc.) |
(A Development Stage Company) |
Notes to the Financial Statements |
April 30, 2007 |
2. |
Summary of Significant Accounting Policies (continued) |
|
d) |
Basic and Diluted Net Income (Loss) Per Share |
|
The Company computes net income (loss) per share in accordance with SFAS No. 128, " Earnings per Share ". SFAS No. 128 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive. |
||
e) |
Comprehensive Loss |
|
SFAS No. 130, Reporting Comprehensive Income , establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at January 31, 2007 and 2006, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements. |
||
f) |
Cash and Cash Equivalents |
|
The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents. |
||
g) |
Inventory |
|
Inventory consists of jewellery and fashion accessories and is valued at the lower of cost and net realizable value. Cost is determined on a first in, first out basis. |
||
h) |
Property and Equipment |
|
Photography equipment is capitalized at original cost and amortized over the estimated useful life of five years on a straight-line basis. One-half amortization is taken in the year of acquisition. |
||
i) |
Advertising |
|
The Company expenses advertising costs as incurred. |
||
j) |
Financial Instruments |
|
The fair value of financial instruments, which include cash, accounts payable, accrued liabilities, and amount due to related parties were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments. Management is of the opinion that the Company is not exposed to significant interest, currency or credit risks arising from financial instruments. |
||
k) |
Income Taxes |
|
Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted SFAS No. 109 Accounting for Income Taxes as of its inception. Pursuant to SFAS No. 109 the Company is required to compute tax asset benefits for net operating losses carried forward. Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years. |
F-5
Blink Couture Inc. |
(Formerly Fashionfreakz International Inc.) |
(A Development Stage Company) |
Notes to the Financial Statements |
April 30, 2007 |
2. |
Summary of Significant Accounting Policies (continued) |
||
l) |
Foreign Currency Translation |
||
The Companys functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated in accordance with SFAS No. 52 Foreign Currency Translation , using the exchange rate prevailing at the balance sheet date. Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in Canadian dollars. The Company has not, to the date of these financials statements, entered into derivative instruments to offset the impact of foreign currency fluctuations. |
|||
m) |
Stock-based Compensation |
||
The Company records stock-based compensation in accordance with SFAS No. 123, Accounting for Stock- Based Compensation . All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued. The Company does not currently have a stock option plan. |
|||
n) |
Recent Accounting Pronouncements |
||
In September 2006, the FASB issued SFAS No. 158, Employers Accounting for Defined Benefit Pension and Other Postretirement Plans an amendment of FASB Statements No. 87, 88, 106, and 132(R) . This statement requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multiemployer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity or changes in unrestricted net assets of a not-for-profit organization. This statement also requires an employer to measure the funded status of a plan as of the date of its year-end statement of financial position, with limited exceptions. The provisions of SFAS No. 158 are effective for employers with publicly traded equity securities as of the end of the fiscal year ending after December 15, 2006. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations. |
|||
In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements . The objective of SFAS 157 is to increase consistency and comparability in fair value measurements and to expand disclosures about fair value measurements. SFAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS 157 applies under other accounting pronouncements that require or permit fair value measurements and does not require any new fair value measurements. The provisions of SFAS No. 157 are effective for fair value measurements made in fiscal years beginning after November 15, 2007. The adoption of this statement is not expected to have a material effect on the Companys future reported financial position or results of operations. |
|||
In June 2006, the Financial Accounting Standards Board (FASB) issued FASB Integration No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statements No. 109 (FIN 48). FIN 48 clarifies the accounting for uncertainty in income taxes by prescribing a two-step method of first evaluating whether a tax position has met a more likely than not recognition threshold and second, measuring that tax position to determine the amount of benefit to be recognized in the financial statements. FIN 48 provides guidance on the presentation of such positions within a classified statement of financial position as well as on derecognition, interest and penalties, accounting in interim periods, disclosure, and transition. FIN 48 is effective for fiscal years beginning after December 15, 2006. The adoption of this standard is not expected to have a material effect on the Companys results of operations or financial position. |
F-6
Blink Couture Inc. |
(Formerly Fashionfreakz International Inc.) |
(A Development Stage Company) |
Notes to the Financial Statements |
April 30, 2007 |
3. |
Related Party Transactions |
|
a) |
At April 30, 2007, the Company is indebted to a Director of the Company for $ Nil (July 31, 2006 - $1,932) for cash advances made to the Company and expenses incurred on behalf of the Company. The amount is unsecured, non-interest bearing and has no stated terms of repayment. |
|
b) |
At April 30, 2007, the President of the Company is owed $7,866 (July 31, 2006 - $5,766) for management fees and rent. The amount is unsecured, non-interest bearing and has no stated terms of repayment. |
|
c) |
In March 2004, the Company entered into an agreement to pay the President of the Company $200 per month for management services provided and $100 per quarter for rent space related to the Company. During the nine months ended April 30, 2007, the Company recognized a total of $1,800 (April 30, 2006 - $1,800) for management services, and $300 (April 30, 2006 - $300) for rent expense. |
|
d) |
See Notes 4(a) and (b). |
|
4. |
Common Stock |
|
a) |
On August 23, 2006, the Company issued 31,250 shares of common stock at $0.20 per share for cash proceeds of $6,250. |
|
b) |
On August 23, 2006, the Company issued 1,000 shares of common stock at $ 0.20 per share for marketing services of $200. |
|
c) |
On September 1, 2006, the Company issued 2,000 shares of common stock at $0.20 per share for cash proceeds of $400. |
|
d) |
On September 1, 2006, the Company issued 500 shares of common stock at $ 0.20 per share for marketing services of $100. |
|
5. |
Commitment |
|
On March 1, 2006, the Company entered into a Lease Agreement to rent an office owned by the President of the Company for a fee of $100 per calendar quarter. For the nine months ended April 30, 2007, rent expense of $300 was recorded as due to related parties. See Note 3(c). |
F-7
ITEM 2. Management Discussion and Analysis of Financial Condition/ Plan of Operations
Forward Looking Statements
This report on Form 10-QSB contains certain forward-looking statements. All statements other than statements of historical fact are forward-looking statements for purposes of these provisions, including any projections of earnings, revenues, or other financial items; any statements of the plans, strategies, and objectives of management for future operation; any statements concerning proposed new products, services, or developments; any statements regarding future economic conditions or performance; statements of belief; and any statement of assumptions underlying any of the foregoing. Such forward-looking statements are subject to inherent risks and uncertainties, and actual results could differ materially from those anticipated by the forward-looking statements.
Overview
Blink Couture Inc. was incorporated as a Delaware company on October 23, 2003 with the former name Fashionfreakz International Inc. On December 2, 2005 we changed our name to Blink Couture Inc. We do not have any subsidiaries.
We are a shell company defined in Rule 405 under the Securities Act of 1933 and Rule 12b-2 under the Securities Exchange Act of 1934, since we have only conducted nominal operations and have only nominal assets.
Since our inception we have not yet earned any revenues and have had operational losses to date. As of April 30, 2007, we incurred net losses of $45,776. We do not expect to generate revenues until the winter 2007. We intend to generate revenues from the sale of clothing, jewelry, and accessories sold on our website.
We are an online fashion business that specializes in retailing clothing, jewelry and accessories produced by independent designers to customers via the Internet. We have launched our website, www.blinkcouture.com, on January 3, 2007. Currently our website includes products of women and accessories. We are negotiating mens and childrens products. We have secured one independent designer, Sweet Dream Tees Inc., which will allow us to produce custom designs.
The following factors raise substantial doubt regarding the ability of our business to continue as a going concern: (i) the losses we incurred since our inception; (ii) no revenues we generated since our inception; and (iiI) our dependence on sale of equity securities and receipt of capital from outside sources to continue in operation. Our auditors have issued a going concern opinion. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue in business. As such we may have to cease operations and you could lose your investment.
2
Description of Property
Our principal executive offices are located at 1199 Marinaside Crescent, Suite 1107, Vancouver, British Columbia, V6Z 2Y2, Canada. On March 1, 2006, we have entered a lease agreement with our President for use of 150 square feet of the premises at a cost of $100 for every 3 months.
Results of Operations for the Three Months ended April 30, 2007 and for the Nine Months ended April 30, 2007
For the three months and nine months ended April 30, 2007, we did not generate any revenues. For the three months ended April 30, 2007 we incurred a net loss of $6,038 compared to a net loss of $777 for the three months ended April 30, 2006. For the nine months ended April 30, 2007 we incurred a net loss of $34,523, compared to a net loss of $2,697 for the nine months ended April 30, 2006. The increase in net losses is due mainly to increases in our day to day operating costs. Our net loss per share was nil for the three and nine months ended April 30, 2007.
Our total expenses were $6,038 for the three months ended April 30, 2007, including $1,589 in professional fees, $600 in management fees, $79 in amortization, $100 for office rent, $1,024 in web development and $2,646 in other general and administrative fees. Our total expenses for the three months ended April 30, 2007 increased $5,261 to $6,038 from $777 for the same period ended April 30, 2006.
Our total expenses were $34,523 for the nine months ended April 30, 2007, including $14,602 in professional fees, $1,800 in management fees, $657 in marketing, $79 in amortization, $300 for office rent, $12,029 in web development and $5,056 in other general and administrative fees. Our total expenses for the nine months ended April 30, 2007 increased $31,826 to $34,523 from $2,697 for the same period ended April 30, 2006. An increase in total expenses was mainly due to increased promotion activities and web development activities.
Our professional fees of $1,589 for the three months ended April 30, 2007 consisted primarily of legal, accounting and auditing fees, compared to $nil for the same period ended April 30, 2006. For the nine months ended April 30, 2007 our professional fees increased $14,082 to $14,602 from $520 for the same period ended April 30, 2006. This increase is due to additional legal and auditing services provided related to a public company.
Our management fees of $600 for the three months ended April 30, 2007 consisted of amounts paid to the President, same as the same period ended April 30, 2006. Our management fees totaled $1,800 for the nine month period ended April 30, 2007 compared to an equal amount for the nine month period ended April 30, 2006.
3
Our web development expenses of $1,024 for the three months ended April 30, 2007 consisted primarily of website design and construction compared to $nil for the same period ended April 30, 2006. For the nine months ended April 30, 2007 our web development expenses totaled $12,029 compared to $nil for the same period ended April 30, 2006. The significant increase in web development costs is due to no web development activities for the three and nine months ended April 30, 2006.
Our general and administrative expenses consist of marketing and promotion, tradeshow costs, travel, meals and entertainment, rent, office maintenance, communication expenses (cellular, internet, fax, telephone), office supplies, courier and postage costs, and office supplies. Our general and administrative fees for the three months ended April 30, 2007 increased $2,648 to $2,825 from $177 for the same period ended April 30, 2006. Our rent was $100, amortization was $79, and other general and administrative fees were $2,646 for the three months ended April 30, 2007.
For the nine month period ending April 30, 2007 our general and administrative expenses increased $5,715 to $6,092 from $377 for the same period ended April 30, 2006, mostly because of our increased general office expenses and promotion activities. Our rent was $300, marketing costs were $657, amortization was $79, and other general and administrative fees were $5,056 for the nine months ended April 30, 2007.
Results of Operations for the Period from October 23, 2003 (Date of Inception) to April 30, 2007
Since our inception on October 23, 2003 to April 30, 2007, we did not generate any revenues. From October 23, 2003 (date of inception) to April 30, 2007, we incurred a net loss of $46,464. Our net loss per share was nil for the period from October 23, 2003 (date of inception) to April 30, 2007.
From October 23, 2003 (date of inception) to April 30, 2007, we incurred total expenses of $46,464, including $14,842 in professional fees, $9,200 in management fees, $657 in marketing, $79 in amortization, $467 for office rent, $12,029 in web development and $9,190 in other general and administrative fees.
Plan of Operations
We plan to focus on custom wear and independent designers. Our target is men, women, children and dog wear. Our business will focus 80% of our clothing product line on womens wear, 10% on mens wear and the remaining 10% on childrens and pet wear. We may change our business plan according to the market trends and our management decisions.
4
Our corporate strategy for the next 12 months (beginning June 2007) includes the following:
Estimated
Completion Date |
Description |
Estimated
Cost ($) |
July 2007
|
New design for packaging inserts (business
cards
with website address) |
2,000
|
July 2007
|
Add additional payment options
including paypal and
payment by cheque into our website |
3,000
|
August 2007 | Add Sophia B. bags and purses to product offering | 5,000 |
September 2007 | Add exclusive shirt designs | 2,000 |
September 2007 | Additional photo and video shoots for our products | 10,000 |
October 2007 | Publicity launch through a publicity agent | 3,000 |
October 2007 | Add new kids line to product offering | 5,000 |
November 2007
|
Obtain at least one
distribution license for pets
accessories |
1,000
|
December 2007
|
Launch grass roots marketing
campaign including
e-cards and funky emails that can be voluntarily sent |
2,000
|
January 2008
|
Attend Pure UK a women's
fashion trade show in
London, England , and also visit Paris to purchase merchandise directly from wholesalers |
2,000
|
March 2008 | Put ads in newspapers. | 1,000 |
May 2008
|
Attend Mode Accessories Trade
Show in Calgary,
Alberta, Canada |
2,000
|
12 months | Accounting and legal fees | 20,000 |
12 months
|
General and administrative
expenses (including
office expenses, telephone and travel expenses) |
10,000
|
12 months | Financing costs | 10,000 |
Total | 80,000 |
At present, our cash requirements for the next twelve months outweigh the funds available to maintain current operations. Our independent accountants, in their report accompanying our audited financial statements, have stated that there is substantial doubt about our ability to continue as a going concern.
5
In order to fully carry out the mentioned above steps, we need an additional financing of approximately $70,000 (total estimated costs of $80,000 less cash of $13,541 for the next 12 months. We intend to approach market makers and brokerages for additional financing. We plan to initially raise $70,000 by private placements from existing shareholders, a public offering or shareholder loans until more financing is available.
There is no assurance we will be successful in our efforts to secure additional equity or debit financing. If we are unable to raise equity or obtain alternative financing, we may not be able to continue operations with respect to the continued development and marketing of our website and our products and then we may have to cease development activities.
If operations and cash flow improve through these efforts, management believes that we can continue to operate. However, no assurance can be given that management's actions will result in profitable operations or the resolution of our liquidity problems.
The threat of our ability to continue as a going concern will be removed only when revenues have reached a level that sustains our business operations.
Liquidity and Capital Resources
As of April 30, 2007, we had a working capital surplus of $2,964 and cash of $13,541. Our accumulated deficit was $46,464 as at April 30, 2007. Our net loss of $46,464 from October 23, 2003 (date of inception) to April 30, 2007 was mostly funded by our equity financing. During the nine months ended April 30, 2007, we raised $6,950 in equity finance, compared to $nil for the same period ended April 30, 2006. The decrease in cash during the nine months ended April 30, 2007 was $27,379. Our net tangible book value was $3,626 or $0.0002 per share as of April 30, 2007.
We used net cash of $32,317 in operations and used net cash of $662 in the purchase of property and equipment for the nine months ended April 30, 2007. For the nine months ended April 30, 2007, we received proceeds of $6,650 in cash and $300 for services from the issuance of our common stock. During the nine months ended April 30, 2007, our monthly cash requirement was approximately $3,700 in operating and investing activities. As at April 30, 2007 we had cash of $13,541, which we anticipate will cover our costs for approximately 3.5 months according to our current monthly burn rate.
We anticipate that after June 2007 our monthly expenses will increase to $7,000. We anticipate that we will incur substantial losses over the next two years. We estimate that we will purchase products and promote our business over the next 12 months beginning June 2007. Total cash requirements to complete those steps will be approximately $80,000 set out as follows:
6
Expense | Amount ($) |
Model and filming expenses | 10,000 |
Website maintenance and marketing | 10,000 |
Inventory expenses | 10,000 |
Product development and improvement and
trade shows |
10,000
|
Accounting and legal fees | 20,000 |
General and Administrative expenses | 10,000 |
Financing Costs | 10,000 |
Total | 80,000 |
Of the $80,000 (including the additional financing costs of $10,000) we need for the next 12 months, we had $13,541 in cash as of April 30, 2007. The balance of our cash requirements for the next 12 months (approximately $70,000) we intend to raise from private placements, shareholder loans or possibly a registered public offering (either self-underwritten or through a broker-dealer) within the next few months. At this time we do not have any commitments from any broker-dealer to provide us with financing.
If we are unsuccessful in raising enough money through future capital raising efforts, we may review other financing possibilities such as bank loans. If we cannot raise at least $70,000, we will not be able to carry out our full business plan and we may not be able to become profitable and we may have to cease operations.
Employees
As of June 8, 2007, we have no part time or full time employees. Both of our directors work part time as independent contractors and work in the areas of web development, business development and management. We currently engage independent contractors in the areas of accounting and legal services.
Limited operating history; need for additional capital
There is limited historical operating information about us upon which to base an evaluation of our performance. We are a development stage company and have generated no revenues. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products.
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We have no assurance that future financing will be available to us on acceptable terms. Obtaining additional financing will be subject to a number of factors including market conditions, investor acceptance of our business plan and investor sentiment. These factors may make the timing, amount, terms and conditions of additional financing unattractive or unavailable to us. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. If we are unable to raise additional financing, we will have to significantly reduce our spending, delay or cancel planned activities or substantially change our current corporate structure. In such an event, we intend to implement expense reduction plans in a timely manner. However, these actions would have material adverse effects on our business, revenues, operating results, and prospects, resulting in a possible failure of our business. If we raise funds through equity or convertible securities, our existing stockholders may experience dilution and our stock price may decline.
We have incurred operating losses from our inception and we are dependent upon our ability to raise capital from stockholders or other sources to sustain operations. These factors raise substantial doubt about our ability to continue as a going concern.
Known Material Trends and Uncertainties
As of April 30, 2007, we had no off balance sheet transactions that have or are reasonably likely to have a current or future effect on our financial condition, changes in our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
In view of the uncertainties concerning our continued existence as a going concern, our management plans to mitigate the effect of such conditions, management intends to take the following steps in the event that we are not able to raise sufficient funds to meet the needs of our business plans:
We believe that the above discussion contains a number of forward-looking statements. Our actual results and our actual plan of operations may differ materially from what is stated above. Factors which may cause our actual results or our actual plan of operations to vary include, among other things, decision of the Board of Directors not to pursue a specific course of action based on a re-assessment of the facts or new facts, or changes in general economic conditions.
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Critical Accounting Policies
The preparation of financial statements in conformity with U.S. 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. An accounting policy is considered to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the financial statements. Financial Reporting Release No. 60 requires all companies to include a discussion of critical accounting policies or methods used in the preparation of financial statements. Note 2 to the financial statements, includes a summary of the significant accounting policies and methods used in the preparation of our financial statements. The following is a discussion of critical accounting policies and methods used by us.
Stock-based Compensation
We record stock-based compensation in accordance with SFAS No. 123, Accounting for Stock-Based Compensation. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued. We do not currently have a stock option plan.
ITEM 3. Control and Procedures
(a) Evaluation of disclosure controls and procedures
Our Chief Executive Officer and Chief Financial Officer evaluated our disclosure controls and procedures (as defined in Rule 13a-14 (c) of the Securities Exchange Act of 1934 (the Exchange Act) as of a date within 90 days before the filing date of this report and has concluded that as of the evaluation date, our disclosure controls and procedures are effective to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commissions rules and forms.
(b) Changes in internal controls
Subsequent to the date of their evaluation, there were no significant changes in our internal controls over financial reporting or in other factors that could significantly affect these controls. There were no significant deficiencies or material weaknesses in our internal controls so no corrective actions were taken.
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PART II OTHER INFORMATION
ITEM 1. Legal Proceedings
Management is not aware of any legal proceedings contemplated by any governmental authority or any other party against us. None of our directors, officers or affiliates are (i) a party adverse to us in any legal proceedings, or (ii) have an adverse interest to us in any legal proceedings. Management is not aware of any other legal proceedings that have been threatened against us.
ITEM 2. Unregistered Sales of Equity Securities
During the three months ended April 30, 2007, we did not make any sales of unregistered securities.
ITEM 3. Defaults upon Senior Securities
None
ITEM 4. Submission of Matters to A Vote of Security Holders
None
ITEM 5. Other Information
None
ITEM 6. Exhibits
Exhibit | Exhibit |
Number | Description |
31.1 | |
32.1 |
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Blink Couture Inc. | |
(Registrant) | |
/s/ Susanne Milka | |
Date: June 14, 2007 | Susanne Milka |
Director , President, Chief Executive Officer | |
Chief Financial Officer | |
Principal Accounting Officer |
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EXHIBIT 31.1
Certification of the Chief Executive Officer and Chief Financial Officer Pursuant to Rule 13A-14 or 15D-14 of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes Oxley Act of 2002
I, Susanne Milka, certify that:
1. |
I have reviewed this report on Form 10-QSB for the period ended April 30, 2007 of Blink Couture Inc. |
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2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
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3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report; |
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4. |
I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small business issuer and have: |
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a) |
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which the quarterly or annual report is being prepared; |
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b) |
evaluated the effectiveness of the small business issuers disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
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c) |
disclosed in this report any change in the small business issuers internal control over financial reporting that occurred during the small business issuers most recent fiscal quarter (the small business issuers fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect the small business issuers internal control over financial reporting; |
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5. |
I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuers auditors and the audit committee of small business issuers board of directors (or persons performing the equivalent function): |
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a) |
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuers ability to record, process, summarize and report financial information; and |
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b) |
any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuers control over financial reporting. |
Date: June 14, 2007 | By: | /s/ Susanne Milka |
Susanne Milka | ||
Director, President, Chief Executive Officer, | ||
Chief Financial Officer, Principal | ||
Accounting Officer |
Exhibit 32.1 |
CERTIFICATION PURSUANT TO |
18 U.S.C. SECTION 1350 |
AS ADOPTED PURSUANT TO |
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 |
In connection with the Quarterly Report of Blink Couture Inc. (the "Company") on Form 10-QSB for the period ended April 30, 2007 as filed with the Securities and Exchange Commission (the "Report"), the undersigned, in the capacities and on the dates indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
1. |
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
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2. |
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Dated: June 14, 2007 | /s/ Susanne Milka |
Susanne Milka | |
President, Chief Executive Officer, | |
Chief Financial Officer, Principal Accounting Office |