Item 1. Business
General Information
Ticket Corp. was incorporated in the State of Nevada on January 17, 2013, as a seller of tickets to concerts, sporting events, theatre and other entertainment events. We are now investigating alternative marketing strategies or possible alternative directions for the Company that could enhance shareholder value. As of the date of this report we do not have any definitive agreements and the Company has not entered into any definitive agreement to change our business plan.
Our intent is to capture the consumer live event ticket and merchandise market through our mobile software application (app) Shindig. This will allow consumers to purchase tickets and performers merchandise and apparel using their smart phones and tablets such as Android and Apple enabled devices. The app, when downloaded by the customer will allow them to receive news and information on their favorite team or performer well as general and premium tickets and licensed event and performer merchandise through their smart phones and mobile devices. Users will be able to peruse and preview seats and merchandise to shows near their current location as well as locations worldwide.
We also provide social media communications that can connect consumer with friends and others who are attending the same event. Users will receive updated information and videos from the performers and teams that they are following.
We also intend to process orders from our customers and track their buying history. We intend to use our potential customers’ purchasing history to make recommendations for upcoming events based upon their previous purchases. Our intention is to maintain our potential customers’ purchasing history as private information and not sell or share this information to others.
Our business plan is based in part on our ability to purchase and re-sell tickets and sell licensed merchandise for special events, attractions, and shows / exhibits. We are currently generating revenue from ticket and merchandise sales through our app. We intend to further develop our business operations to provide real time delivery of merchandise at the show allowing consumers to avoid the merchandise booths and in some cases have the item delivered to their seats.
We are an active company with $384,823 in revenues since inception. The mailing address for the principal executive offices is 1135 Terminal Way, Suite 209, Reno, NV 89502. The telephone number is (775)352-3936.
We received our initial funding of $33,000 through the sale of common stock to Russell Rheingrover, an officer and director who purchased 33,000,000 shares of our common stock at $0.001 per share on January 31, 2013. He currently owns 69% of the outstanding common stock of the Company. (See “Risk Factors”, specifically page 10, to be advised of the risks to other shareholders due to his majority ownership). Our financial statements from inception (January 17, 2013) through December 31, 2018 report $384,998 in revenues and an accumulated deficit of $429,370. Our total stockholders’ equity as of December 31, 2018 is $(346,870). Our independent auditor has issued an audit opinion for Ticket Corp. which includes a statement expressing substantial doubt as to our ability to continue as a going concern.
We completed our initial offering and are continuing to move forward in the execution of our full business plan. Our assets at December 31, 2018 were $4,394 in cash. Management estimates our current monthly “burn rate” to be $5,000 and estimate our current cash and receivables will last through mid-January2019, if no additional revenues are realized and no further funds are advanced from the director.
Mr. Rheingrover, who currently owns 69% of our outstanding voting stock, is also the Chief Executive Officer of Jiffy Tickets, a national reseller of concert, theater, sporting and event tickets. He currently devotes approximately 5 hours of his business time to our affairs and the balance to Jiffy Tickets. He owes a fiduciary duty of loyalty to us, but also owes similar fiduciary duties to Jiffy Tickets. Due to his responsibilities to serve both companies, there is potential for conflicts of interest. He will use every effort to avoid material conflicts of interest generated by his responsibilities to both companies, but no assurance can be given that material conflicts will not arise which could be detrimental to our operations and financial prospects.
There is no current public market for our securities. As our stock is not yet publicly traded, investors should be aware they probably will be unable to sell their shares and their investment in our securities is not liquid. We are currently working with a market maker on an application for trading of our common stock on the over the counter bulletin board. We can provide no assurance that our shares will be traded on the bulletin board, or if traded, that a public market will materialize.
Description of Business
Executive Summary
Ticket Corp. is an active company with a plan to make the purchasing and distribution of event tickets and merchandise in the secondary market, easier, more accessible, and cost-effective for sellers and buyers of tickets. We are also now investigating alternative marketing strategies or possible alternative directions for the Company that could enhance shareholder value. As of the date of this report we do not have any definitive agreements and the Company has not entered into any definitive agreement to change our business plan. Ticket Corp. was incorporated in Nevada on January 17, 2013. At that time Russell Rheingrover was appointed CEO, President, Secretary, CFO, Treasurer and Director. The Board voted to seek capital and begin development of our business plan. We received our initial funding of $33,000 through the sale of common stock to Russell Rheingrover who purchased 33,000,000 shares of our Common Stock at $0.001 per share on January 31, 2013. Kristi Ann Nelson was named to the Board of Directors and elected as current Treasurer and C.F.O. on February 1, 2013. The Company’s Registration Statement on Form S-1 was declared effective on July 25, 2014. In October 2014 the Company sold 15,000,000 shares of common stock to 50 independent shareholders at a price of $0.033 per share for total proceeds of $49,500, pursuant to the Registration Statement.
Principal products or services and their markets
The entertainment and
event sales market has multiple facets. Ticket Corp. participates in the secondary ticket market which includes the resale of tickets to concerts, sporting events, theatre, and other entertainment events as well as the live merchandise market which provides authentic merchandise related to the live performance. According to the website quora.com the secondary ticket market was a 4.5 billion-dollar market. (There is no guarantee that we will be able to obtain any substantial market share in this industry.) Since we have a mobile app that has geo-location we are able to find and provide tickets to almost all events in the United States and offer licensed merchandise to a majority of events
We have entered into partnerships with major merchandise providers and currently have over 10,000 articles of merchandise available through our app. We also have entered into partnerships with build on demand organizations that allow us to build and ship to order without having to stock inventory. This also eliminates the issues of out of stock styles and sizes
The Company intends to record when new event tickets will be on sale and utilize our data and industry to track and analyze ticket pricing trends in order to purchase tickets as close as possible at their lowest purchase point. We believe this will keep our overhead low by not maintaining a warehouse of tickets, or merchandise. It also means we will be able to utilize our data and experience to cater to customer’s changing preferences for services, related events, and merchandise.
There is no guarantee that our business plan will succeed. Also, there is no guarantee our potential customers will utilize our offerings of additional services, related events or merchandise.
Due to our Chief Executive Officer’s experience and relationships in the event marketing industry the Company intends or has already cultivated partnerships and relationships with major providers in the ticketing and merchandise markets regarding purchase and resale of tickets and in conjunction with providing artist merchandise and the other capabilities of our app such as the selling event merchandise before, during or after the event through our Mobile Live Event Application. We have entered into agreements with Control Industry, Liquid Blue, My Locker, Tick City and Ticket Network. We have entered into an agreement with Tick City to be the primary mobile application for their clients which include major NCAA athletics and well as Premier League Soccer. The price and the availability of tickets from primary resellers are determined by market demand for the artist and the event promotion.
We may post tickets we purchase on our app that are being offered by other ticket services such as Stubhub and Ticketmaster. We post these tickets to try to provide every available seat to an event. We charge a processing fee on these sales.
Ticket Corp does not, and will not, implement automated purchasing agents. The Company relies on manual purchasing based on methodology devised of tracking history and demand. The Company intends to record when new event tickets will be on sale, physically purchase initial ticket inventories and
utilize our software to allow us to track and analyze ticket pricing trends in order to purchase tickets as close as possible at their lowest purchase point. We will continue to buy and sell tickets up to the time the event occurs. Purchases are made via deduction from the Company’s cash account and we manually enter the CAPTCHA (an acronym for "Completely Automated Public Turing test to tell Computers and Humans Apart") a type of challenge-response test used in computing to determine whether or not the user is human.
We intend to implement the following steps of our business plan:
·
The Company has developed a method for allowing consumers to purchase tickets and merchandise directly to the smartphone. This has been done through software development on existing MAC IOS and Android platforms. The Company continues to develop databases of our customers’ purchasing history to make recommendations for upcoming events, and for use in creating direct marketing strategies.
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Create contests and promotions on social media websites such as Facebook and Twitter to create ongoing customer loyalty and generate sales.
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We intend to have our company representatives attend concerts, sporting, theatres and other entertainment events to promote ensure execution of in-event merchandise.
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We have an active stage website, “ticketcorp.com” (which website is expressly not included or incorporated by reference to this filing) the intent of which is to direct customers to downloading our application Shindig from the Apple and Android stores.
On December 17, 2014, the Company signed a Promissory Note in the amount of $240,000 with Russell Rheingrover. The note had an annual interest of 1.00%. The maturity date of the note was March 13, 2018. The note was associated with an Assignment Agreement between the Company and Mr. Rheingrover wherein Mr. Rheingrover assigned all of his rights to the Stadium Builders License Agreement with the Santa Clara Stadium Authority to purchase and resell tickets to San Francisco 49er’s games with a fair market value of $80,000 per year for three years. The Company had accrued $3,800 in interest on the note as of June 30, 2016. On August 31, 2016 the Assignment Agreement was cancelled due to non-performance. All accrued interest was also cancelled, resulting in a gain of $3,800.
We are an active development stage business. In order to implement our business plan, we have completed the following steps to date:
1.
Purchased our domain name www.Ticketcorp.com (which website is expressly not included or incorporated by reference to this filing) in January 2013.
2.
Retained a web designer as of February 2013 who has designed our company logo and website, which is currently an active website.
3.
Built a database extension and electronic file system that allows us to store and search customer records. We intend to use this database to analyze our customer database to make selected recommendations for upcoming events. These were completed in April 2013.
4.
Completed the design of its Mobile Live Event Application for use on iPhone and Android Phone operating systems. This application delivers an electronic ticket to customers’ phones as well as performer videos, news and authentic merchandise. It allows scanners at event sites to scan the customers’ phones and confirm the customers’ valid ticket purchases for event entry without paper tickets.
5.
Developed a feature for selling event merchandise through our Mobile Live Event Application. This allows us to send our customers a text code that allows them to purchase event merchandise without having to stand in line at post event sales booths.
6.
We retained a U/I (user interface) engineer to implement a “native” smart phone interface focused on ease of use and efficient fulfillment.
7.
We have created the product name for our app “Shindig”
8.
We have developed a version of the app which is “skinable” in essence we can create a specific version of our app for an artist or team with the branding of “powered by Shindig.
9.
We completed the user interface in native smart phone format for both iPhones and Android phones
10.
We are in the final pre-launch testing of the application.
11.
We are in the final stages of integrating partnerships with authentic merchandise providers to ensure available merchandise for live events.
Accomplished during the Fiscal Year Ended December 31, 2018:
Accomplished during First Quarter Q1 2018:
Joined and attended numerous LIMA (Licensing Industry Merchants Association) events. Signed additional authorized licensed merchandise providers including American Classics
Marketing - Implemented a social media marketing program on the launch and announcement of Shindig 2.0 including a promotion for downloading the new version. Developed and launched the (zero cost) $1 CD and download store in the App
Technology - Completed testing of Shindig 2.0 and released on the Apple Store and Android Store and Google Play updates included
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Updated and enhanced admin functionality
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Simplified Category assignment and modification processes
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API2Cart implementation for vendor inventory management
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Enhanced reporting functionality
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Designed new geolocation functionality
Accomplished during Second Quarter Q2
Updated and release the technical specifications for version 3.0 of the Shindig focusing on the Social platform launch
Continued to develop the live event community through news, blogs giveaways and promotion with targeted advertising.
Finalized technical spec for the B2B product offering separate from App development [event credentialing platform (primary ticketing and web-based, self-serve event creation)]
Accomplished during Third Quarter Q3 2018
Continued 3.0 development, finalized spec for 4.0 development and map out development timeline and sprints
Continued to develop the live event community through news, blogs giveaways and promotion with targeted advertising.
Accomplished during Fourth Quarter Q4 2018
Continued 3.0 development, finalized spec for 4.0 development and map out development timeline and sprints
Continued to develop the live event community through news, blogs giveaways and promotion with targeted advertising.
Plan of Operation
We are now investigating alternative marketing strategies or possible alternative directions for the Company that could enhance shareholder value. As of the date of this report we do not have any definitive agreements and the Company has not entered into any definitive agreement to change our business plan.
Distribution methods of the products or services
We intend to sell tickets and merchandise online to concerts, sporting events, theatre, and other entertainment events directly to our customers using their smart phones and tablets such as Android and Apple enabled devices. When our customers arrive at an event venue, the unique barcode on their smart phones and tablets will be verified with the existing scanners already in use at the event venues. Ticket Corp will be using universal barcodes that work with any scanning device. Venues that have ticket scanning capability accept barcodes on Smart Phones. There does not need to be an agreement with any venue that use the universal barcodes. There are still some older and smaller venues that do not utilize universal barcodes or use scanning devices and still tear tickets. In those cases, and in cases where hard tickets are needed to enter an event, we make arrangements to mail a hard ticket or make that ticket available at will call. Our order processing through Ticket Network significantly reduces the risk of lost tickets and ticket fraud. We deliver related merchandise to our customers which will be shipped directly to the customers by the vendors, by us or picked up at the event.
If we are successful in our business plans and attract customers, they may use our website or use our smartphone application to choose the venue, event time and date and purchase their tickets through PayPal or their credit card, Apple Pay and Android Pay.
Pricing
We intend to use our management’s experience and our software to time the ticket sales side of our business to maximize the highest price possible in order to maintain positive cash flow and profit. Our pricing will be based upon market demand. Each event has a limited amount of available tickets and as the event date approaches, the price will normally fluctuate with the supply and demand for tickets offered for sale. Other variables that can affect this are weather, team performance, the last minute absence of a key player or performer, the last minute addition of additional shows by the promoter or performer.
Status of any publicly announced new product or service
We currently have no new product or service publicly announced.
Overview of the Online Ticketing Industry
Management believes, based on our experience as frequent attendees of events, that ticketing is an industry that has experienced very little innovation over many years, but is now evolving into a business that increasingly emphasizes improving the experience for the two most important parties involved in ticketing for any entertainment and sporting event - patrons and the providers of the entertainment. Though the technology for delivering tickets via smartphones is already in use within the industry, in our opinion it is not widely or effectively used, in our opinion.
Competition, competitive position in the industry and methods of competition
The ticketing industry is highly competitive. We will face significant competition from established national, regional and local primary ticketing service providers as well as self-ticketing systems through facility box offices and season, subscription or group sales. We will also face competition in the resale of tickets from online auction websites and resale marketplaces and from other ticket resellers with online distribution capabilities. There can be no assurance that if we are able to establish our business that will be able to compete successfully in the future with existing or potential competitors or that competition will not have an adverse effect on our business and financial condition.
There are a number of competitors in this area
Sources and availability of raw materials and the names of principal suppliers
We intend to purchase our tickets from arenas, amphitheaters, theaters, performance halls, golf tournaments, festivals and fairs, rodeos, sports teams. We intend to purchase most of our tickets from the primary ticket market which is defined as the original seller of the ticket.
Dependence on one or a few major customers
Due to the large number of individual ticket purchasers we will not be dependent upon one or few major customers if we are able to carry out our business plan.
Patents, trademarks, licenses, franchises, concessions, royalty agreements or labor contracts
The Company presently has no patents or trademarks, licenses, franchises, concessions, royalty agreements or labor contracts. We plan to seek intellectual property protection for our app technology.
Need for any government approval of principal products or services
The Company will be subject to numerous state and local licensing laws and laws that require the disclosure of specified information to ticket purchasers.
Bankruptcy or Similar Proceedings
There has been no bankruptcy, receivership or similar proceeding.
Reorganization, Purchase or Sale of Assets
There have been no material reclassifications, mergers, consolidations, or purchase or sale of a significant amount of assets not in the ordinary course of business.
Effect of existing or probable governmental regulations on the business
The Company will be subject to numerous state and local licensing laws and laws that require the disclosure of specified information to ticket purchasers.
In San Francisco and California there are no special licensing requirements to be an on-line ticket reseller. We are not subject to anti-scalping laws as these laws in both San Francisco and the State of California apply to physically selling tickets on or near the venue premises.
In addition, increasing concern over consumer privacy has led to the introduction from time to time of proposed legislation which could impact the direct marketing and market research industries. The Company does not know when or whether any such proposed legislation may pass or whether any such legislation would relate to the types of services currently provided by the Company or which the Company intends to develop. Accordingly, the Company cannot predict the effect, if any, that any such future regulation may have on its business.
Research and development activities during the last two years
We have expended funds for research and development costs since inception.
Costs and effects of compliance with environmental laws
We do not anticipate any costs or effects of compliance with environmental laws.
Number of total employees and number of full time employees
We currently have two full time employees, and a number of contracted personnel including in the areas of business and technology development. Our officers, Russell Rheingrover and Kristi Ann Nelson plan to devote as much time to our business as is necessary and currently are responsible for our general strategy, fund raising and customer relations and product development. Mr. Rheingrover estimates he is currently devoting approximately 25 hours per week to Company matters and Ms. Nelson estimates she is spending approximately 2 hours on Company matters per week. Once sales support the expense we may hire additional staff.
Mr. Rheingrover, who currently owns 69% of our outstanding voting stock, is also the Chief Executive Officer of Jiffy Tickets, a national reseller of concert, theater, sporting and event tickets. He currently devotes approximately 5 hours of his business time to our affairs and the balance to Jiffy Tickets. He owes a fiduciary duty of loyalty to us, but also owes similar fiduciary duties to Jiffy Tickets. Due to his responsibilities to serve both companies, there is potential for conflicts of interest. He will use every effort to avoid material conflicts of interest generated by his responsibilities to both companies, but no assurance can be given that material conflicts will not arise which could be detrimental to our operations and financial prospects.
Item 1A.
Item 1A. Risk Factors
The risk factors required pursuant to Regulation S-K, Item 503(c) are not required for smaller reporting companies. Accordingly, the Company has determined to provide particular risk factors at this time. The risks and uncertainties described below are not the only ones facing us. Other events that we do not currently anticipate or that we currently deem immaterial also may affect our results of operations and financial condition. If any events described in the risk factors actually occur, our business, operating results, prospects and financial condition could be materially harmed. In connection with the forward-looking statements that appear elsewhere in this annual report, you should also carefully review the cautionary statement referred to under “Cautionary Note Regarding Forward Looking Statements.”
WE ARE A DEVELOPMENT STAGE COMPANY AND HAVE A LIMITED OPERATING HISTORY. AN INVESTMENT IN THE SHARES OFFERED HEREIN IS HIGHLY RISKY AND COULD RESULT IN A COMPLETE LOSS OF YOUR INVESTMENT IF WE ARE UNSUCCESSFUL IN OUR BUSINESS PLAN.
Ticket Corp was incorporated on January 17, 2013 and we have only recently commenced our business operations. Until we are actually in the marketplace for a demonstrable period of time, it is impossible to determine if our business strategy will be viable or successful. Any such failure could result in the possible closure of our business or force us to seek additional capital through loans or additional sales of our equity securities to continue business operations, which would dilute the value of current shares.
OUR AUDITORS HAVE ISSUED A GOING CONCERN OPINION, THEREFORE THERE IS SUBSTANTIAL UNCERTAINTY WE WILL CONTINUE ACTIVITIES IN WHICH CASE YOU COULD LOSE YOUR INVESTMENT.
Our independent registered public accounting firm issued its report in connection with the audit of our financial statements as of December 31, 2018, which included an explanatory paragraph describing the existence of conditions that raise substantial doubt about our ability to continue as a going concern. In addition, our note to our financial statements for the year ended December 31, 2018 included an explanatory paragraph describing the existence of conditions that raise substantial doubt about our ability to continue as a going concern. If we are not able to continue as a going concern, it is likely that holders of our common stock will lose all of their investment. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.
WE ARE AN “EMERGING GROWTH COMPANY” AND WE CANNOT BE CERTAIN IF THE REDUCED DISCLOSURE REQUIREMENTS APPLICABLE TO EMERGING GROWTH COMPANIES WILL MAKE OUR COMMON STOCK LESS ATTRACTIVE TO INVESTORS.
We are an “emerging growth company,” as defined in the Jumpstart our Business Startups Act of 2012, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
Under the Jumpstart Our Business Startups Act, “emerging growth companies” can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to avail ourselves to this exemption from new or revised accounting standards and, therefore, we will not be subject to the same new or revised accounting standards as other public companies that are not “emerging growth companies.”
As a result of our election to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2), our financial statements may not be comparable to companies that comply with public company effective dates.
OUR LIMITED OPERATING HISTORY MAKES IT DIFFICULT TO EVALUATE OUR FUTURE PROSPECTS AND RESULTS OF OPERATION.
We were incorporated on January 17, 2013 have a limited operating history. Accordingly, you should consider our future prospects in light of the risks and uncertainties experienced by development stage companies in evolving industries. Some of these risks and uncertainties relate to our ability to:
1.
Establish and maintain our market position;
2.
Respond to competitive market conditions;
3.
Increase awareness of our brand;
4.
Respond to changes in our regulatory environment;
5.
Maintain effective control of our costs and expenses;
6.
Raise sufficient capital to sustain and expand our business; and
7.
Attract, retain and motivate qualified personnel.
If we are unsuccessful in addressing any of these risks and uncertainties, our business may be materially and adversely affected.
OUR BUSINESS WILL BE DEPENDENT ON OUR ABILITY TO PURCHASE TICKETS FROM PROMOTERS AND VENUES TO BE ABLE TO RESELL TICKETS TO CONSUMERS. IF WE ARE UNABLE TO PURCHASE TICKETS OUR BUSINESS WILL BE ADVERSELY AFFECTED.
If we are unable to purchase tickets from promoters or venues, we may not be able to execute our business plan. If we are unable to purchase for resale from primary sellers enough inventory of tickets, or there is not enough inventory for us to acquire in the primary or secondary markets, our business, financial condition and/or results of operations could be materially and adversely affected.
Another important component of our success will be the ability to establish and maintain relationships with service providers, including providers of credit card processing, internet services, as well as advertisers, among other parties. Any inability to establish these relationships or adverse changes in these relationships, including the inability of these parties to fulfill their obligations to us for any reason, could adversely affect our business.
OUR SUCCESS DEPENDS, IN SIGNIFICANT PART, ON ENTERTAINMENT, SPORTING AND LEISURE EVENTS AND ANY FACTORS THAT MAY HAVE AN ADVERSE AFFECT ON SUCH EVENTS COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS, FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Our business plan is to sell tickets to live entertainment and leisure events at arenas, stadiums, theaters and other facilities. Accordingly, our business, financial condition and results of operations will be directly affected by the popularity, frequency and location of such events. Ticket sales are sensitive to fluctuations in the number and pricing of entertainment and leisure events and activities offered by promoters, facilities, and adverse trends in the entertainment and leisure event industries could adversely affect our business. In addition, general economic conditions, consumer trends, work stoppages, natural disasters and terrorism could have a material adverse effect on our business. Entertainment-related expenditures are particularly sensitive to business and personal discretionary spending levels, which tend to decline during general economic downturns. A protracted global recession could have a significant negative impact on our business, financial condition and results of operations could be negatively impacted.
THE TICKETING INDUSTRY IS HIGHLY COMPETITIVE AND COMPETITORS MAY NOT BE ABLE TO WIN BUSINESS AWAY FROM COMPETITORS, WHICH COULD ADVERSELY AFFECT THE COMPANY'S FINANCIAL PERFORMANCE.
The ticketing industry is highly competitive. We will face significant competition from established national, regional and local primary ticketing service providers as well as self-ticketing systems through facility box offices and season, subscription or group sales. We will also face competition in the resale of tickets from online auction websites and resale marketplaces and from other ticket resellers with online distribution capabilities. There can be no assurance that if we are able to establish our business that will be able to compete successfully in the future with existing or potential competitors or that competition will not have an adverse effect on its business and financial condition.
OUR BUSINESS MAY SUFFER IF IT IS ALLEGED OR DETERMINED THAT THE TECHNOLOGY WE DEVELOP INFRINGES UPON THE INTELLECTUAL PROPERTY RIGHTS OF OTHERS.
The technology industry is characterized by the existence of a large number of patents, copyrights, trademarks, trade secrets and other intellectual and proprietary rights. Companies in the technology industry are often required to defend against litigation claims based on allegations of infringement or other violations of intellectual property rights. Many of our competitors and other industry participants have been issued patents and/or have filed patent applications and may assert patent or other intellectual property rights within the industry. Our future technologies may not be able to withstand any third-party claims or rights against their use. Claims of intellectual property infringement might require us to redesign our application, delay releases, enter into costly settlement or license agreements or pay costly damage awards, or face a temporary or permanent injunction prohibiting us from marketing or selling our ticket services. The occurrence of any of these events may have a material adverse effect on our business.
THERE ARE NO SUBSTANTIAL BARRIERS TO ENTRY INTO THE INDUSTRY AND BECAUSE WE DO NOT CURRENTLY HAVE ANY INTELLECTUAL PROPERTY PROTECTION FOR OUR TECHNOLOGY OR SERVICES, THERE IS NO GUARANTEE SOMEONE ELSE WILL NOT DUPLICATE OUR IDEAS, WHICH COULD SEVERELY LIMIT OUR SALES AND REVENUES.
Since we have no copyright protection, unauthorized persons may attempt to copy aspects of our business, including our web site design or functionality, products or marketing materials. We have no plans to seek intellectual property protection at this time. Any encroachment upon our corporate information, including the unauthorized use of our brand name or the use of a similar name by a competing company, may affect our ability to create brand name recognition, cause customer confusion and/or have a detrimental effect on our business. Litigation or proceedings before the U.S. or International Patent and Trademark Offices may be necessary in the future to enforce our intellectual property rights, to protect our trade secrets and domain name. Any such infringement, litigation or adverse proceeding could result in substantial costs and diversion of resources and could seriously harm our business operations and/or results of operations.
WE MAY NOT BE ABLE TO ADAPT OUR BUSINESS QUICKLY ENOUGH TO CHANGING CUSTOMER REQUIREMENTS AND INDUSTRY STANDARDS.
The e-commerce industry is characterized by evolving industry standards, frequent new service and product introductions and enhancements and changing customer demands. We may not be able to adapt quickly enough and/or in a cost-effective manner to changes in industry standards and customer requirements and preferences, and any failure to do so could adversely affect our business. In addition, the continued widespread adoption of new Internet or telecommunications technologies and devices or other technological changes could require us to modify or adapt our respective services or infrastructures. We may be unable to devote financial resources to new technologies and systems in the future. Any failure on our part to modify or adapt those respective services or infrastructures in response to these trends could render our website and services obsolete, which could adversely affect our business.
IF THERE ARE EVENTS OR CIRCUMSTANCES AFFECTING THE RELIABILITY AND SECURITY OF THE INTERNET, ACCESS TO OUR WEBSITE AND/OR THE ABILITY TO SAFEGUARD CONFIDENTIAL INFORMATION COULD BE IMPAIRED CAUSING A NEGATIVE EFFECT ON THE FINANCIAL RESULTS OF OUR BUSINESS OPERATIONS.
Despite the implementation of security measures, once our website it up and running, our website infrastructure may be vulnerable to computer viruses, hacking or similar disruptive problems caused by members, other Internet users, other connected Internet sites, and the interconnecting telecommunications networks. Such problems caused by third-parties could lead to interruptions, delays or cessation of service to our customers. Inappropriate use of the Internet by third-parties could also potentially jeopardize the security of confidential information stored in our computer system, which may deter individuals from becoming customers. Such inappropriate use of the Internet includes attempting to gain unauthorized access to information or systems, which is commonly known as “cracking” or “hacking.” Although we intend to implement security measures, such measures have been circumvented in the past by hackers on other websites on the internet, and there can be no assurance that any measures we implement would not be circumvented in future. Dealing with problems caused by computer viruses or other inappropriate uses or security breaches may require interruptions, delays or cessation of service to our customers, which could have a material adverse effect on our business, financial condition and results of operations.
ANY FAILURE TO COMPLY WITH EXISTING LAWS, RULES AND REGULATIONS AS WELL AS CHANGING LAWS, RULES AND REGULATIONS AND OTHER LEGAL UNCERTAINTIES, COULD ADVERSELY AFFECT OUR BUSINESS.
Our business is to sell tickets and provide related services to consumers online. We are subject to a wide variety of statutes, rules, regulations, policies and procedures in various jurisdictions in the United States, which are subject to change at any time. For example, those laws, rules and regulations applicable to providers of primary ticketing and ticket resale services, which in some cases regulate the amount of transaction and other fees that they may be charged in connection with primary ticketing sales and/or the ticket prices that may be charged in the case of ticket resale services. New legislation of this nature is introduced from time to time in various jurisdictions in which we may sell tickets and provide services. Our failure to comply with these laws and regulations could result in fines and/or proceedings against us by governmental agencies and/or consumers, which if material, could adversely affect our business and results of operations. In addition, the promulgation of new laws, rules and regulations that restrict or otherwise unfavorably impact the ability or manner in which we may provide ticket services may require us to change certain aspects of our business to ensure compliance, which could decrease demand for services, reduce revenues, increase costs and/or subject us to additional liabilities.
WE MAY NEED TO OBTAIN ADDITIONAL FINANCING IF WE FAIL TO GENERATE REVENUE IN THE ANTICIPATED TIMEFRAME. IF WE DO NOT OBTAIN SUCH FINANCING, WE MAY HAVE TO REDUCE OR CEASE OUR ACTIVITIES AND INVESTORS COULD LOSE THEIR ENTIRE INVESTMENT.
There is no assurance that we will operate profitably or generate positive cash flow in the future. We may require additional financing to sustain our business operations if we are not successful in receiving revenues at the levels we anticipate. We currently do not have any arrangements for further financing and we may not be able to obtain financing on commercially reasonable terms or terms that are acceptable to us when it is required. Because of the worldwide economic downturn or because of other reasons, we may not be able to raise any additional funds that we require on favorable terms, if any. The failure to obtain necessary financing, if needed, may impair our ability to continue in business.
IF WE OBTAIN DEBT FINANCING, WE WILL FACE RISKS ASSOCIATED WITH FINANCING OUR OPERATIONS.
If we obtain debt financing, we will be subject to the normal risks associated with debt financing, including the risk that our cash flow will be insufficient to meet required payments of principal and interest, and the risk that we will not be able to renew, repay, or refinance our debt when it matures or that the terms of any renewal or refinancing will not be as favorable as the existing terms of that debt. If we enter into secured lending facilities and are unable to pay our obligations to our secured lenders, they could proceed against any or all of the collateral securing our indebtedness to them.
OUR SUCCESS IS DEPENDENT ON A LIMITED NUMBER OF KEY EXECUTIVES.
The success of our business strategy and our ability to operate profitably depends on the continued employment of our management team. The loss of the services of one or more of these key executives could have a material adverse effect on our business, financial condition and/or results of operations. There can be no assurance that we will be able to retain our existing management, attract additional qualified executives or adequately fill new management positions or vacancies created by expansion or turnover. We do not have employment agreements with members of our management team and we do not maintain key-person life insurance policies on their lives. The loss of any of our management or key personnel could seriously harm our business.
OUR CHIEF EXECUTIVE OFFICER DOES NOT HAVE EXPERIENCE WITH MANAGING A PUBLIC COMPANY.
Our Chief Executive Officer has no direct training or experience in managing and fulfilling the regulatory reporting obligations of a public company. While his business experience includes management and marketing, particularly in the ticket industry, he does not have experience as an officer or director in a public company setting. In the event he is unable to fulfill any aspect of his duties to the Company we may experience a shortfall or complete lack of sales resulting in little or no profits and eventual closure of our business.
HAVING ONLY TWO DIRECTORS LIMITS OUR ABILITY TO ESTABLISH EFFECTIVE INDEPENDENT CORPORATE GOVERNANCE PROCEDURES AND INCREASES THE CONTROL OF OUR PRESIDENT OVER OPERATIONS AND BUSINESS DECISIONS INCLUDING SALARIES AND PERQUISITES.
We have only two directors, who are our principal executive officers. Accordingly, we cannot establish board committees comprised of independent members to oversee functions like compensation or audit issues. In addition, a tie vote of board members is decided in favor of the chairman, which gives him significant control over all corporate issues, including all major decisions on operations and corporate matters such as approving salary and perquisites. The directors will also determine their own salaries and perquisites and as a result there could be no funds for net income. Until we have a larger board of directors that would include some independent members, if ever, there will be limited oversight of our president’s decisions and activities and little ability for minority shareholders to challenge or reverse those activities and decisions, even if they are not in the best interests of minority shareholders.
RUSSELL RHEINGROVER, OUR SENIOR EXECUTIVE OFFICER IS ALSO THE SENIOR EXECUTIVE OFFICER OF JIFFY TICKETS WHICH COULD CREATE A POTENTIAL FOR CONFLICTS OF INTEREST.
Mr. Rheingrover who currently owns 69% of our outstanding voting stock is also the Chief Executive Officer of Jiffy Tickets, a national reseller of concert, theater, sporting and event tickets. He currently devotes approximately 5 hours of his business time to our affairs and the balance to Jiffy Tickets. He owes a fiduciary duty of loyalty to us, but also owes similar fiduciary duties to Jiffy Tickets. Due to his responsibilities to serve both companies, there is potential for conflicts of interest. He will use every effort to avoid material conflicts of interest generated by his responsibilities to both companies, but no assurance can be given that material conflicts will not arise which could be detrimental to our operations and financial prospects.
OUR COMMON STOCK MAY BE CONSIDERED A “PENNY STOCK,” AND THEREBY BE SUBJECT TO ADDITIONAL SALE AND TRADING REGULATIONS THAT MAY MAKE IT MORE DIFFICULT TO SELL.
Our common stock is considered to be a “penny stock.” It does not qualify for one of the exemptions from the definition of “penny stock” under Section 3a51-1 of the Exchange Act. Our common stock is a “penny stock” because it meets one or more of the following conditions (i) the stock trades at a price less than $5.00 per share; (ii) it is not traded on a “recognized” national exchange or (iii) it is not quoted on the NASDAQ Global Market, or has a price less than $5.00 per share. The principal result or effect of being designated a “penny stock” is that securities broker-dealers participating in sales of our common stock are subject to the “penny stock” regulations set forth in Rules 15-2 through 15g-9 promulgated under the Securities Exchange Act. For example, Rule 15g-2 requires broker-dealers dealing in penny stocks to provide potential investors with a document disclosing the risks of penny stocks and to obtain a manually signed and dated written receipt of the document at least two business days before effecting any transaction in a penny stock for the investor’s account. Moreover, Rule 15g-9 requires broker-dealers in penny stocks to approve the account of any investor for transactions in such stocks before selling any penny stock to that investor. This procedure requires the broker-dealer to (i) obtain from the investor information concerning his or her financial situation, investment experience and investment objectives; (ii) reasonably determine, based on that information, that transactions in penny stocks are suitable for the investor and that the investor has sufficient knowledge and experience as to be reasonably capable of evaluating the risks of penny stock transactions; (iii) provide the investor with a written statement setting forth the basis on which the broker-dealer made the determination in (ii) above; and (iv) receive a signed and dated copy of such statement from the investor, confirming that it accurately reflects the investor’s financial situation, investment experience and investment objectives. Compliance with these requirements may make it more difficult and time consuming for holders of our common stock to resell their shares to third parties or to otherwise dispose of them in the market or otherwise.
THERE IS NO PUBLIC MARKET FOR OUR SECURITIES AND AN ACTIVE TRADING MARKET MAY NOT DEVELOP.
We cannot predict the extent to which investor interest will lead to the development of an active trading market on the OTC Bulletin Board or otherwise or how liquid that market might become. An active public market for our Common Stock may not develop or be sustained after the offering. If an active public market does not develop or is not sustained, it may be difficult for our current shareholders to sell their shares of Common Stock at a price that is attractive to them, or at all.
RULE 144 SALES IN THE FUTURE MAY HAVE A DEPRESSIVE EFFECT ON THE COMPANY’S STOCK PRICE AS AN INCREASE IN SUPPLY OF SHARES FOR SALE, WITH NO CORRESPONDING INCREASE IN DEMAND WILL CAUSE PRICES TO FALL.
All of the outstanding shares of common stock held by the present officers, directors, and affiliate stockholders are “restricted securities” within the meaning of Rule 144 under the Securities Act of 1933, as amended. As restricted shares, these shares may be resold only pursuant to an effective registration statement or under the requirements of Rule 144 or other applicable exemptions from registration under the Securities Act of 1933 and as required under applicable state securities laws. Rule 144 provides in essence that a person who is an affiliate or officer or director who has held restricted securities for six months may, under certain conditions, sell every three months, in brokerage transactions, a number of shares that does not exceed the greater of 1.0% of a Company’s issued and outstanding common stock. There is no limit on the amount of restricted securities that may be sold by a non-affiliate after the owner has held the restricted securities for a period of six months if the Company is a current reporting company under the Securities Exchange Act of 1934. A sale under Rule 144 or under any other exemption from the Securities Act of 1933, if available, or pursuant to subsequent registration of shares of common stock of present stockholders, may have a depressive effect upon the price of the common stock in any market that may develop. In addition, if we are deemed a shell company pursuant to Section 12(b)-2 of the Act, our “restricted securities”, whether held by affiliates or non-affiliates, may not be re-sold for a period of 12 months following the filing of a Form 10 level disclosure or registration pursuant to the Securities Act of 1933.
FAILURE TO ACHIEVE AND MAINTAIN EFFECTIVE INTERNAL CONTROLS IN ACCORDANCE WITH SECTION 404 OF THE SARBANES-OXLEY ACT COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS AND OPERATING RESULTS.
It is time consuming, difficult and costly for us to develop and maintain the internal controls, processes and reporting procedures required by the Sarbanes-Oxley Act, and as our business develops, we may need to hire additional financial reporting, internal auditing and other finance staff in order to remain compliant. The cost of compliance will adversely affect our financial results, while, if we are unable to comply, we may not be able to obtain the independent accountant certifications that the Sarbanes-Oxley Act requires of publicly traded companies.
If we fail to comply in a timely manner with the requirements of Section 404 of the Sarbanes-Oxley Act regarding internal control over financial reporting or to remedy any material weaknesses in our internal controls that we may identify, such failure could result in material misstatements in our financial statements, cause investors to lose confidence in our reported financial information and have a negative effect on the trading price of our common stock.
Pursuant to Section 404 of the Sarbanes-Oxley Act and current SEC regulations, we are required to prepare assessments regarding internal controls over financial reporting and furnish a report by our management on our internal control over financial reporting. Failure to achieve and maintain an effective internal control environment or complete our Section 404 certifications could have a material adverse effect on our stock price.
In addition, in connection with our on-going assessment of the effectiveness of our internal control over financial reporting, we may discover “material weaknesses” in our internal controls as defined in standards established by the Public Company Accounting Oversight Board, or the PCAOB. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. The PCAOB defines “significant deficiency” as a deficiency that results in more than a remote likelihood that a misstatement of the financial statements that is more than inconsequential will not be prevented or detected.
In the event that a material weakness is identified, upon receiving sufficient financing or generating sufficient revenues, we will employ qualified personnel and adopt and implement policies and procedures to address any such material weaknesses. However, the process of designing and implementing effective internal controls is a continuous effort that requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to maintain a system of internal controls that is adequate to satisfy our reporting obligations as a public company. We cannot assure you that the measures we will take will remediate any material weaknesses that we may identify or that we will implement and maintain adequate controls over our financial process and reporting in the future.
Any failure to complete our assessment of our internal control over financial reporting, to remediate any material weaknesses that we may identify or to implement new or improved controls, or difficulties encountered in their implementation, could harm our operating results, cause us to fail to meet our reporting obligations or result in material misstatements in our financial statements. Any such failure could also adversely affect the results of the periodic management evaluations of our internal controls and, in the case of a failure to remediate any material weaknesses that we may identify, would adversely affect the annual auditor attestation reports regarding the effectiveness of our internal control over financial reporting that are required under Section 404 of the Sarbanes-Oxley Act. Inadequate internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our common stock.
The systems of internal controls and procedures that we have developed and implemented to date are adequate in a research and development business. The current transaction volume and limited transaction channels mean that operating management, financial management, board members and auditor can, and do, efficiently perform a very extensive and detailed transaction review to ensure compliance with the Company’s established procedures and controls. If our business grows rapidly, we may not be able to keep up with recruiting and training personnel, and enhancing our systems of internal control in line with the growth in transaction volumes and compliance risks which could result in loss of assets, profit, and ability to manage the daily operations of our Company.
PUBLIC DISCLOSURE REQUIREMENTS AND COMPLIANCE WITH CHANGING REGULATION OF CORPORATE GOVERNANCE POSE CHALLENGES FOR OUR MANAGEMENT TEAM AND RESULT IN ADDITIONAL EXPENSES AND COSTS WHICH MAY REDUCE THE FOCUS OF MANAGEMENT AND THE PROFITABILITY OF OUR COMPANY.
Changing laws, regulations and standards relating to corporate governance and public disclosure, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules and regulations promulgated thereunder, the Sarbanes-Oxley Act and SEC regulations, have created uncertainty for public companies and significantly increased the costs and risks associated with accessing the U.S. public markets. Our management team will need to devote significant time and financial resources to comply with both existing and evolving standards for public companies, which will lead to increased general and administrative expenses and a diversion of management time and attention from revenue generating activities to compliance activities.
SHOULD ONE OR MORE OF THE FOREGOING RISKS OR UNCERTAINTIES MATERIALIZE, OR SHOULD THE UNDERLYING ASSUMPTIONS PROVE INCORRECT, ACTUAL RESULTS MAY DIFFER SIGNIFICANTLY FROM THOSE ANTICIPATED, BELIEVED, ESTIMATED, EXPECTED, INTENDED OR PLANNED
Item 1B.
Item 1B. Unresolved Staff Comments
This Item is not applicable to us as we are not an accelerated filer, a large accelerated filer, or a well-seasoned issuer.
Item 2.
Item 2. Properties
We do not currently own any property. The mailing address of our executive offices is 1135 Terminal Way, Suite 209, Reno, NV 89502. We currently operate out of the office of our President, Russell Rheingrover at no charge and consider our current space arrangement adequate and will reassess our needs based upon the future growth of the Company.
Item 3.
Item 3. Legal Proceedings
We are not currently involved in any legal proceedings nor do we have any knowledge of any threatened litigation.
Item 4.
Item 4. Mine Safety Disclosures
None.
Part II
Item 5.
Item 5. Market for Common Equity and Related Stockholder Matters
No Public Market for Common Stock
There is presently no public market for our common stock. Through a market maker we have initiated an application for trading of our common stock on the over the counter bulletin board. We can provide no assurance that our shares will be traded on the bulletin board, or if traded, that a public market will materialize.
The Securities Exchange Commission has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the Commission, that: (a) contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading; (b) contains a description of the broker's or dealer's duties to the customer and of the rights and remedies available to the customer with respect to a violation to such duties or other requirements of Securities' laws; (c) contains a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and the significance of the spread between the bid and ask price;(d) contains a toll-free telephone number for inquiries on disciplinary actions;(e) defines significant terms in the disclosure document or in the conduct of trading in penny stocks; and;(f) contains such other information and is in such form, including language, type, size and format, as the Commission shall require by rule or regulation.
The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with; (a) bid and offer quotations for the penny stock;(b) the compensation of the broker-dealer and its salesperson in the transaction;(c) the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and (d) a monthly account statements showing the market value of each penny stock held in the customer's account.
In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those 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 acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our stock if it becomes subject to these penny stock rules. Therefore, because our common stock is subject to the penny stock rules, stockholders may have difficulty selling those securities.
Holders of Our Common Stock
On January 31, 2013, the Company issued a total of 33,000,000 shares of common stock to its sole officer Russell Rheingrover for cash in the amount of $0.001 per share for a total of $33,000.
The Company’s Registration Statement on Form S-1 was declared effective on July 25, 2014. In October 2014 the Company sold 15,000,000 shares of common stock to 50 independent shareholders at a price of $0.033 per share for total proceeds of $49,500, pursuant to the Registration Statement.
As of December 31, 2018, the Company had 48,000,000 shares of common stock issued and outstanding, held by fifty-one (51) shareholders of record.
Rule 144 Shares
None of our common stock is currently available for resale to the public under Rule 144. In general, under Rule 144 as currently in effect for over the-counter-stocks, including those quoted on the OTC Bulletin Board and the OTC Markets Pink Sheets, an affiliate of the Company who has beneficially owned shares of a Company’s common stock for at least one year is entitled to sell within any three month period a number of shares that does not exceed one percent of the number of shares of the Company’s common stock then outstanding.
Sales under Rule 144 are also subject to manner of sale provisions and notice requirements and to the availability of current public information about the Company.
Under Rule 144(k), a person who is not one of the Company’s affiliates at any time during the three months preceding a sale, and who has beneficially owned the shares proposed to be sold for at least one year, is entitled to sell shares without complying with the manner of sale, public information, volume limitation or notice provisions of Rule 144.
Stock Option Grants
None.
Dividends
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.
Item 6.
Item 6. Selected Financial Data
Not required under Regulation S-K for “smaller reporting companies.”
Item 7.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following is management’s discussion and analysis (“MD&A”) of certain significant factors that have affected our financial position and operating results during the periods included in the accompanying financial statements, as well as information relating to the plans of our current management. This report includes forward-looking statements. Generally, the words “believes,” “anticipates,” “may,” “will,” “should,” “expect,” “intend,” “estimate,” “continue,” and similar expressions or the negative thereof or comparable terminology are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, including the matters set forth in this report or other reports or documents we file with the Securities and Exchange Commission from time to time, which could cause actual results or outcomes to differ materially from those projected. Undue reliance should not be placed on these forward-looking statements which speak only as of the date hereof. We undertake no obligation to update these forward-looking statements.
The following discussion and analysis should be read in conjunction with our financial statements and the related notes thereto and other financial information contained elsewhere in this Form 10-K
The Company’s MD&A is comprised of significant accounting estimates made in the normal course of its operations, overview of the Company’s business conditions, results of operations, liquidity and capital resources and contractual obligations. The Company did not have any off-balance sheet arrangements as of December 31, 2018 or 2017.
The discussion and analysis of the Company’s financial condition and results of operations is based upon its financial statements, which have been prepared in accordance with generally accepted accounting principles generally accepted in the United States (or “GAAP”). The preparation of those financial statements requires us to make estimates and judgments that affect the reported amount of assets and liabilities at the date of its financial statements. Actual results may differ from these estimates under different assumptions or conditions.
Our Ability To Continue as a Going Concern
Our independent registered public accounting firm has issued its report in connection with the audit of our financial statements as of December 31, 2018 that included an explanatory paragraph describing the existence of conditions that raise substantial doubt about our ability to continue as a going concern. Our financial statements as of December 31, 2018 have been prepared under the assumption that we will continue as a going concern. If we are not able to continue as a going concern, it is likely that holders of our common stock will lose all of their investment. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Results of Operations for the period from inception (January 17, 2013) to December 31, 2018
We have generated $384,998 in revenues since our inception on January 17, 2013. Our cost of goods sold was $257,085 resulting in a gross profit of $127,914. During the period from inception to December 31, 2018, our operating expenses were comprised of general and administrative expenses
of $561,084.
Results of Operations for the years ended December 31, 2018 and December 31, 2017
We generated $175 and $12,208 in revenues for the years ended December 31, 2018 and 2017, respectively. Our cost of goods sold was $670 and $10,204, resulting in a gross profit (loss) of $(495) and $2,004, respectively. The difference in revenue was based upon market sales and the amount of tickets and price we were able to sell them for. The difference in the cost of goods sold was due to prevailing ticket prices for purchase and the market price at which the tickets could be resold. We incurred operating expenses of $29,208 and $117,268 for the years ended December 31, 2018 and 2017, respectively. These expenses consisted of general operating expenses, including professional fees and research and development costs, incurred in connection with the day to day operation of our business and the preparation and filing of our periodic reports. For the years ended December 31, 2018 and 2017 we recorded $25,914 and $17,063 in interest expense. The increase in interest was due to the additional convertible notes from cash loaned to our company by the director.
As of December 31, 2018, $347,864 is owed to Russell Rheingrover, CEO. $100 of the funds were loaned by him to the Company to open the bank account and is non-interest bearing with no specific repayment terms. $5,375 of the funds were for payment of an outstanding balance to DDC for software development. The accrued interest payable of the Convertible Notes as outlined below was $54,247.
$35,000 of the funds are the result of a 10% Convertible Note issued on September 3, 2015. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by September 3, 2016 or is convertible at the conversion price of $0.05 per common stock share. On September 3, 2018, the terms of the Note were extended to September 2, 2019. The conversion price was considered by management to be a fair price.
$25,000 of the funds are the result of a 10% Convertible Note issued on October 5, 2015. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by October 5, 2016 or is convertible at the conversion price of $0.05 per common stock share. On October 5, 2018 the terms of the Note were extended to October 4, 2019. The conversion price was considered by management to be a fair price.
$35,000 of the funds are the result of a 10% Convertible Note issued on April 30, 2016. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by April 30, 2017 or is convertible at the conversion price of $0.10 per common stock share. On April 30, 2018, the terms of the Note were extended to April 30, 2019. The conversion price was considered by management to be a fair price.
$20,000 of the funds are the result of a 10% Convertible Note issued on September 8, 2016. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by September 8, 2017 or is convertible at the conversion price of $0.15 per common stock share. On September 8, 2018, the terms of the Note were extended to September 8, 2019. The conversion price was considered by management to be a fair price.
$30,000 of the funds are the result of a 10% Convertible Note issued on October 26, 2016. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by October 26, 2017 or is convertible at the conversion price of $0.15 per common stock share. On October 26, 2018, the terms of the Note were extended to October 26, 2019. The conversion price was considered by management to be a fair price.
$30,000 of the funds are the result of a 10% Convertible Note issued on January 6, 2017. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by January 6, 2018 or is convertible at the conversion price of $0.15 per common stock share. On January 6, 2018, the terms of the Note were extended to January 6, 2019. The conversion price was considered by management to be a fair price.
$10,000 of the funds are the result of a 10% Convertible Note issued on July 3, 2017. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by July 2, 2018 or is convertible at the conversion price of $0.15 per common stock share. On July 2, 2018, the terms of the Note were extended to July 2, 2019. The conversion price was considered by management to be a fair price. The conversion price was considered by management to be a fair price.
$5,000 of the funds are the result of a 10% Convertible Note issued on October 3, 2017. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by October 2, 2018 or is convertible at the conversion price of $0.15 per common stock share. On October 3, 2018, the terms of the Note were extended to October 2, 2019. The conversion price was considered by management to be a fair price.
$53,000 of the funds are the result of a 10% Convertible Note issued on March 30, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by March 29, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
$36,876 of the funds are the result of a 10% Convertible Note issued on June 30, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by June 30, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
$3,599 of the funds are the result of a 10% Convertible Note issued on September 30, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by September 30, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
$4,668 of the funds are the result of a 10% Convertible Note issued on December 22, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by December 21, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
As of December 31, 2018, our company had $3,400 in Accounts Payable and $54,247 in accrued interest expense.
We received the initial equity funding of $33,000 from our sole officer, Russell Rheingrover, who purchased 33,000,000 shares of our common stock at $0.001 per share.
Our Registration Statement on Form S-1 was declared effective on July 25, 2014. In October 2014, our company sold 15,000,000 shares of common stock to 50 independent shareholders at a price of $0.033 per share for total proceeds of $49,500, pursuant to the Registration Statement.
We had 48,000,000 shares of common stock issued and outstanding as of December 31, 2018.
The following table provides selected financial data about our company for the period from the date of incorporation through December 31, 2018. For detailed financial information, see the financial statements included in this report.
We are actively working to continue the advancement of our business plan.
We are an active development stage business. In order to implement our business plan, we have completed the following steps to date:
1.
Purchased our domain name www.Ticketcorp.com (which website is expressly not included or incorporated by reference to this filing) in January 2013.
2.
Retained a web designer as of February 2013 who has designed our company logo and website, which is currently an active website.
3.
Built a database extension and electronic file system that allows us to store and search customer records. We intend to use this database to analyze our customer database to make selected recommendations for upcoming events. These were completed in April 2013.
4.
Completed the design of its Mobile Live Event Application for use on iPhone and Android Phone operating systems. This application delivers an electronic ticket to customers’ phones as well as performer videos, news and authentic merchandise. It allows scanners at event sites to scan the customers’ phones and confirm the customers’ valid ticket purchases for event entry without paper tickets.
5.
Developed a feature for selling event merchandise through our Mobile Live Event Application. This allows us to send our customers a text code that allows them to purchase event merchandise without having to stand in line at post event sales booths.
6.
We retained a U/I (user interface) engineer to implement a “native” smart phone interface focused on ease of use and efficient fulfillment.
7.
We have created the product name for our app “Shindig”
8.
We have developed a version of the app which is “skinable” in essence we can create a specific version of our app for an artist or team with the branding of “powered by Shindig.
9.
We completed the user interface in native smart phone format for both iPhones and Android phones
10.
We are in the final pre-launch testing of the application.
11.
We are in the final stages of integrating partnerships with authentic merchandise providers to ensure available merchandise for live events.
12.
We have built a partnership with vendor for providing the application to NCAA soccer teams and have had initial discussions with Premier League Soccer Clubs in the UK.
Accomplished during First Quarter Q1 2018:
Joined and attended numerous LIMA (Licensing Industry Merchants Association) events. Signed additional authorized licensed merchandise providers including American Classics
Marketing - Implemented a social media marketing program on the launch and announcement of Shindig 2.0 including a promotion for downloading the new version. Developed and launched the (zero cost) $1 CD and download store in the App
Technology - Completed testing of Shindig 2.0 and released on the Apple Store and Android Store and Google Play updates included
-
Updated and enhanced admin functionality
-
Simplified Category assignment and modification processes
-
API2Cart implementation for vendor inventory management
-
Enhanced reporting functionality
-
Designed new geolocation functionality
Accomplished during Second Quarter Q2
Updated and release the technical specifications for version 3.0 of the Shindig focusing on the Social platform launch
Continued to develop the live event community through news, blogs giveaways and promotion with targeted advertising.
Finalized technical spec for the B2B product offering separate from App development [event credentialing platform (primary ticketing and web-based, self-serve event creation)]
Accomplished during Third Quarter Q3 2018
Continued 3.0 development, finalized spec for 4.0 development and map out development timeline and sprints
Continued to develop the live event community through news, blogs giveaways and promotion with targeted advertising.
Accomplished during Fourth Quarter Q4 2018
Continued 3.0 development, finalized spec for 4.0 development and map out development timeline and sprints
Continued to develop the live event community through news, blogs giveaways and promotion with targeted advertising.
Liquidity and Capital Resources
Our assets at December 31, 2018 were $4,394 in cash. Management estimates our current monthly “burn rate” to be $5,000 and estimate our current cash and receivables will last through mid-January 2019, if no additional revenues are realized and no further funds are advanced from the director.
Plan of Operation
We are now investigating alternative marketing strategies or possible alternative directions for the Company that could enhance shareholder value. As of the date of this report we do not have any definitive agreements and the Company has not entered into any definitive agreement to change our business plan.
Off Balance Sheet Arrangements
As of December 31, 2018, there were no off balance sheet arrangements.
Going Concern
The accompanying financial statements are presented on a going concern basis. We had limited operations during the period from January 17, 2013 (date of inception) to December 31, 2018. This condition raises substantial doubt about our ability to continue as a going concern. We currently in the development stage and has minimal expenses; management believes that our current cash of $4,394 is not sufficient to cover the expenses they will incur during the next twelve months. Additional revenues and possibly loans from our director will be required for our company to remain in business.
Emerging Growth Company Status
We are an "emerging growth company" as defined under the Jumpstart our Business Startups Act ("JOBS Act"). We will remain an "emerging growth company" for up to five years, or until the earliest of:
1.
the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion,
2.
the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or
3.
the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
As an "emerging growth company", we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to:
·
not being required to comply with the auditor attestation requirements of section 404(b) of the Sarbanes-Oxley Act (“Sarbanes Oxley”) (we also will not be subject to the auditor attestation requirements of section 404(b) as long as we are a "smaller reporting company", which includes issuers that had a public float of less than $75 million as of the last business day of their most recently completed second fiscal quarter);
·
reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and
·
exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
In addition, section 107 of the JOBS Act provides that an "emerging growth company" can take advantage of the extended transition period provided in section 7(a)(2)(B) of the Securities Act of 1933 (the "Securities Act") for complying with new or revised accounting standards. Under this provision, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
During the time we qualify as an emerging growth company we plan to take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include:
·
A requirement to have only two years of audited financial statements and only two years of related MD&A;
·
Exemption from the auditor attestation requirement in the assessment of the emerging growth company’s internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002;
·
Reduced disclosure about the emerging growth company’s executive compensation
·
Arrangements.
Limited Operating History; Need for Additional Capital
There is no historical financial information about us on which to base an evaluation of our performance. We are a development stage company and 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, possible delays in implementing our business plan, and possible cost overruns due to increases in the cost of services.
To become profitable and competitive, we must implement our business plan and continue to generate revenue.
Significant Accounting Policies
Basis of Accounting
The accompanying audited financial statements of Ticket Corp. (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and the rules of the Securities and Exchange Commission. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein.
Basic Loss per Share
ASC No. 260, “Earnings per Share”, specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock. The Company has adopted the provisions of ASC No. 260.
Basic net loss per share amounts is computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted loss per share is the same as basic loss per share because the consideration of these shares would be anti-dilutive in periods of loss.
If the company issues all shares convertible under the terms of the loans payable to Russell Rheingrover (see Related Party Transactions) the number of shares to be issued to Mr. Rheingrover would be 2,837,620 for the principal balance and 656,028 for the accrued interest if it is converted to shares.
Cash Equivalents
The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.
Use of Estimates and Assumptions
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. In accordance with ASC No. 250 all adjustments are normal and recurring.
Income Taxes
Income taxes are provided in accordance with ASC No. 740, Accounting for Income Taxes. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carry-forwards. Deferred tax expense (benefit) results from the net change during the year of deferred tax assets and liabilities.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
Revenue
In accordance with ASC 605, the Company records revenue when all goods and services have been performed and delivered, the amounts are readily determinable, and collection is reasonably assured.
Reclassification
Certain balances from prior periods have been reclassified in these audited financial statements to conform to current period presentation. This had no impact on prior reported assets, equity, or operations.
Software Development Costs
The company expenses software development costs in accordance with FASB ASC 985-20-25. All costs incurred to establish the technological feasibility of a computer software product to be sold, leased, or otherwise marketed are research and development costs. Once technological feasibility has been reached, but not before it is released to the public, the cost incurred for software development can be capitalized and amortized after release. The company incurred no software development costs during the fiscal year ended December 31, 2018 and $65,594 during the fiscal year ended December 31, 2017.
Advertising Costs
The company expenses advertising costs as they are incurred. The company incurred no advertising costs during the fiscal years ended December 31, 2018 and 2017.
Item 7A.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Not required for smaller reporting companies.
Item 8.
Item 8. Financial Statements
Our Financial Statements begin on page of this Annual Report on Form 10-K and are incorporated herein by reference.
Item 9.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A.
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our principal executive officer and the principal financial officer (our president), we have conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as of the end of the period covered by this report. Based on this evaluation, our principal executive officer and principal financial officer concluded as of the evaluation date that our disclosure controls and procedures were not effective such that the material information required to be included in our Securities and Exchange Commission reports is accumulated and communicated to our management, including our principal executive and financial officer, recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms relating to our company, particularly during the period when this report was being prepared.
Management's Annual Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, for the Company.
Internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of its management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
Management recognizes that there are inherent limitations in the effectiveness of any system of internal control, and accordingly, even effective internal control can provide only reasonable assurance with respect to financial statement preparation and may not prevent or detect material misstatements. In addition, effective internal control at a point in time may become ineffective in future periods because of changes in conditions or due to deterioration in the degree of compliance with our established policies and procedures.
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in there being a more than remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.
Under the supervision and with the participation of our president, management conducted an evaluation of the effectiveness of our internal control over financial reporting, as of December 31, 2018, based on the framework set forth in Internal Control-Integrated Framework - 2013 issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our evaluation under this framework, management concluded that our internal control over financial reporting was not effective as of the evaluation date due to the factors stated below.
Management assessed the effectiveness of the Company’s internal control over financial reporting as of evaluation date and identified the following material weaknesses:
Insufficient Resources: We have an inadequate number of personnel with requisite expertise in the key functional areas of finance and accounting.
Inadequate Segregation of Duties: We have an inadequate number of personnel to properly implement control procedures.
Lack of Audit Committee & Outside Directors on the Company’s Board of Directors: We do not have a functioning audit committee or outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures.
Management is committed to improving its internal controls and will (1) continue to use third party specialists to address shortfalls in staffing and to assist the Company with accounting and finance responsibilities, (2) increase the frequency of independent reconciliations of significant accounts which will mitigate the lack of segregation of duties until there are sufficient personnel and (3) may consider appointing outside directors and audit committee members in the future.
Management, including our president, has discussed the material weakness noted above with our independent registered public accounting firm. Due to the nature of this material weakness, there is a more than remote likelihood that misstatements which could be material to the annual or interim financial statements could occur that would not be prevented or detected.
This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management's report in this annual report.
Changes in Internal Controls Over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during the last fiscal quarter for our fiscal year ended December 31, 2018 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Item 9B.
Item 9B. Other Information
None.
PART III
Item 10.
Item 10. Director and Executive Officer
The name, age and title of our executive officers and directors are as follows:
The persons named above are the only promoters of Ticket Corp., as that term is defined in the rules and regulations promulgated under the Securities and Exchange Act of 1933. Mr. Rheingrover has served in his positions from inception (January 17, 2013) until present and Ms. Nelson has served as Director since inception and as Treasurer & Chief Financial (Accounting) Officer since February 1, 2013.
Term of Office
Directors are appointed to hold office until the next annual meeting of our stockholders or until a successor is elected and qualified, or until resignation or removal in accordance with the provisions of the Company by-laws or Nevada corporate law. Officers are appointed by our Board of Directors and holds office until removed by the Board. The Board of Directors has no nominating, auditing or compensation committees.
Significant Employees
We currently have two employees, Mr. Rheingrover and Ms. Nelson. Mr. Rheingrover and Ms. Nelson currently devote the hours necessary to our business and are responsible for our general strategy, fund raising and customer relations.
No officer or director of the Company has been the subject of any order, judgment, or decree of any court of competent jurisdiction, or any regulatory agency permanently or temporarily enjoining, barring, suspending or otherwise limiting him from acting as an investment advisor, underwriter, broker or dealer in the securities industry, or as an affiliated person, director or employee of an investment company, bank, savings and loan association, or insurance company or from engaging in or continuing any conduct or practice in connection with any such activity or in connection with the purchase or sale of any securities. No officer or director of the Company has been convicted in any criminal proceeding (excluding traffic violations) nor are they the subject of any currently pending criminal proceeding.
Executive Biography
Russell Rheingrover, President, Secretary, CEO and Director
Mr. Rheingrover is the founder of Ticket Corp. He has over twenty years’ experience in building and developing emerging companies, primarily in the technology and entertainment industries.
From 2008 to current he has been the owner of Jiffy Tickets a national reseller of concert, theater, sporting and event tickets. From 2003 to 2008 he was Director of North American Sales for PureDepth Inc., whose patented technology is used to enhance an array of advanced electronic displays, including mobile devices, casino games, amusement games and public information displays. From 1999 to 2003 he was Director U.S Sales for Pulse Entertainment where he was responsible for developing relationships with many key entertainment groups including Warner Brothers and NBC. From 1996 to 1999 he was in charge of Retail and Channel Sales for Hitachi in North America. From 1993 to 1996 he was Senior Vice President of Sales and Marketing for Velocity Corp., a leading video game developer and distributor.
Mr. Rheingrover is a graduate of the University of Pacific with a Bachelor of Science in Business Administration with an emphasis on Marketing in 1987.
Kristi Ann Nelson, Treasurer, CFO and Director
Ms. Nelson joined Ticket Corp. in February 2013. She has extensive experience in both technology and major media marketing.
From May 2009 to current she has been the Digital Account Director for IDG Enterprise (an International Data Group (IDG) company). IDG is a leading technology, media, research, event management, and venture capital organization. At IDG she is responsible for approximately 650 Business2Business clients in Washington and Oregon. Business2Business refers to "the exchange of products, services, or information between businesses rather than between businesses and consumers." From September 2008 to May 2009 she held the position of Account Manager for Computerworld at IDG Enterprise. From July 2006 to August 2008 she was a Regional Account Manager at Ziff Davis Enterprise, responsible for optimizing marketing strategies through integrated media programs for multiple clients. From November 2004 to June 2006 she was self-employed as a consultant in sales infrastructure assisting sales and marketing professionals in ways to improve their sales opportunities.
Ms. Nelson is a graduate of Cal State Chico with a Bachelor of Arts Degree in Psychology in 1992.
Code of Ethics
We do not currently have a code of ethics, because we have only limited business operations and only one officer and director, we believe a code of ethics would have limited utility. We intend to adopt such a code of ethics as our business operations expand and we have more directors, officers and employees.
Item 11.
Item 11. Executive Compensation
Management Compensation
Currently our officers and directors receive no compensation for their services during the development stage of our business operations. Officers and directors are reimbursed for any out-of-pocket expenses they may incur on our behalf. In the future once revenue is being generated, we may approve payment of salaries for officers and directors, but currently, no such plans have been approved. No officer or director salaries were paid from the proceeds of our recent offering. We do not have any employment agreements in place with our officer and director. We also do not currently have any benefits, such as health or life insurance, available to our employee.
SUMMARY COMPENSATION TABLE
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
DIRECTOR COMPENSATION
Grants of Plan-Based Awards
There were no grants of plan based awards.
Outstanding Stock Awards at Year End
There were no stock awards
Option Exercises and Stock Vested
There were no options exercised or stock vested by our named officers.
Non Qualified Deferred Compensation
None.
Golden Parachute Compensation
None.
Employment Agreements
As of this time, there are no employment agreements with any named executive officer.
On January 31, 2013, a total of 33,000,000 shares of common stock were issued to Russell Rheingrover in exchange for cash in the amount of $33,000 or $0.001 per share.
There are no annuity, pension or retirement benefits proposed to be paid to the officer or director or employees in the event of retirement at normal retirement date pursuant to any presently existing plan provided or contributed to by the Company.
Item 12.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following table sets forth certain information concerning the number of shares of our common stock owned beneficially as of the date of this annual report by: (i) each person (including any group) known to us to own more than five percent (5%) of any class of our voting securities, (ii) our directors, and or (iii) our officers. Unless otherwise indicated, the stockholder listed possesses sole voting and investment power with respect to the shares shown.
(1)
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. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person’s actual ownership or voting power with respect to the number of shares of common stock actually outstanding as of the date of this annual report. As of the date of this annual report, there were 48,000,000 shares of our common stock issued and outstanding.
Description of Securities
The following statements relating to the capital stock set forth the material terms of our securities; however, reference is made to the more detailed provisions of, and such statements are qualified in their entirety by reference to, the Certificate of Incorporation, amendment to the Certificate of Incorporation and the By-laws, copies of which are filed as exhibits to this registration statement. We currently have 100,000,000 shares of common stock,0.001 par value authorized.
Common Stock
The holders of our Common Stock are entitled to one vote per share on all matters to be voted on by our stockholders, including the election of directors. Our stockholders are not entitled to cumulative voting rights, and, accordingly, the holders of a majority of the shares voting for the election of directors can elect the entire board of directors if they choose to do so and, in that event, the holders of the remaining shares will not be able to elect any person to our board of directors.
The holders of the Company’s Common Stock are entitled to receive ratably such dividends, if any, as may be declared from time to time by the Board of Directors, in its discretion, from funds legally available. Upon the Company’s liquidation, dissolution or winding up, the holders of our Common Stock are entitled to receive on a pro rata basis our remaining assets available for distribution. Holders of the Company’s Common Stock have no preemptive or other subscription rights, and there are no conversion rights or redemption or sinking fund provisions with respect to such shares. All outstanding shares of the Company’s Common Stock are, fully paid and not liable to further calls or assessment by the Company.
Item 13.
Item 13. Certain Relationships and Related Transactions
On January 31, 2013, the Company issued a total of 33,000,000 shares of common stock to Russell Rheingrover for cash at $0.001 per share for a total of $33,000. A deposit of $30,000 was made by the Company on January 31, 2013 with the remaining $3,000 being carried as a Subscription Receivable. On February 11, 2013 the Subscription Receivable carried by the Company for $3,000 was fulfilled and deposited in the Company’s bank account.
As of December 31, 2018, $347,864 is owed to Russell Rheingrover, CEO. $100 of the funds were loaned by him to the Company to open the bank account and is non-interest bearing with no specific repayment terms. $5,375 of the funds were for payment of an outstanding balance to DDC for software development. The accrued interest payable of the Convertible Notes as outlined below was $54,247.
$35,000 of the funds are the result of a 10% Convertible Note issued on September 3, 2015. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by September 3, 2016 or is convertible at the conversion price of $0.05 per common stock share. On September 3, 2018, the terms of the Note were extended to September 2, 2019. The conversion price was considered by management to be a fair price.
$25,000 of the funds are the result of a 10% Convertible Note issued on October 5, 2015. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by October 5, 2016 or is convertible at the conversion price of $0.05 per common stock share. On October 5, 2018 the terms of the Note were extended to October 4, 2019. The conversion price was considered by management to be a fair price.
$35,000 of the funds are the result of a 10% Convertible Note issued on April 30, 2016. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by April 30, 2017 or is convertible at the conversion price of $0.10 per common stock share. On April 30, 2018, the terms of the Note were extended to April 30, 2019. The conversion price was considered by management to be a fair price.
$20,000 of the funds are the result of a 10% Convertible Note issued on September 8, 2016. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by September 8, 2017 or is convertible at the conversion price of $0.15 per common stock share. On September 8, 2018, the terms of the Note were extended to September 8, 2019. The conversion price was considered by management to be a fair price.
$30,000 of the funds are the result of a 10% Convertible Note issued on October 26, 2016. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by October 26, 2017 or is convertible at the conversion price of $0.15 per common stock share. On October 26, 2018, the terms of the Note were extended to October 26, 2019. The conversion price was considered by management to be a fair price.
$30,000 of the funds are the result of a 10% Convertible Note issued on January 6, 2017. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by January 6, 2018 or is convertible at the conversion price of $0.15 per common stock share. On January 6, 2018, the terms of the Note were extended to January 6, 2019. The conversion price was considered by management to be a fair price.
$10,000 of the funds are the result of a 10% Convertible Note issued on July 3, 2017. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by July 2, 2018 or is convertible at the conversion price of $0.15 per common stock share. On July 2, 2018, the terms of the Note were extended to July 2, 2019. The conversion price was considered by management to be a fair price.
The conversion price was considered by management to be a fair price.
$5,000 of the funds are the result of a 10% Convertible Note issued on October 3, 2017. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by October 2, 2018 or is convertible at the conversion price of $0.15 per common stock share. On October 3, 2018, the terms of the Note were extended to October 2, 2019. The conversion price was considered by management to be a fair price.
$53,000 of the funds are the result of a 10% Convertible Note issued on March 30, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by March 29, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
$36,876 of the funds are the result of a 10% Convertible Note issued on June 30, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by June 30, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
$3,599 of the funds are the result of a 10% Convertible Note issued on September 30, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by September 30, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
$4,668 of the funds are the result of a 10% Convertible Note issued on December 22, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by December 21, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
Mr. Rheingrover, who currently owns 69% of our outstanding voting stock, is also the Chief Executive Officer of Jiffy Tickets, a national reseller of concert, theater, sporting and event tickets. He currently devotes approximately 5 hours of his business time to our affairs and the balance to Jiffy Tickets. He owes a fiduciary duty of loyalty to us, but also owes similar fiduciary duties to Jiffy Tickets. Due to his responsibilities to serve both companies, there is potential for conflicts of interest. He will use every effort to avoid material conflicts of interest generated by his responsibilities to both companies, but no assurance can be given that material conflicts will not arise which could be detrimental to our operations and financial prospects. For the year ended December 31, 2017 the revenue generated from Jiffy Tickets was almost 50% of total revenues generated for Ticket Corp.
We have not yet formulated a policy for handling conflicts of interest; however, we intend to do so prior to hiring any additional employees.
Item 14.
Item 14. Principal Accounting Fees and Services
The total fees charged to the Company for audit services, including quarterly reviews, were $14,250 for audit-related services, tax services were $Nil and other services were $Nil during the year ended December 31, 2018.
The total fees charged to the Company for audit services, including quarterly reviews, were $10,950 for audit-related services, for tax services $Nil and other services were $Nil during the year ended December 31, 2017.
PART IV
Item 15.
Item 15. Exhibits
The following exhibits are included with this filing:
*
Incorporated by reference to the Company’s Form S-1 filed with the Securities and Exchange Commission (File Number 000-55547.) filed March 26, 2013
Signatures
Pursuant to the requirements of Section 13(a) 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, on April 1, 2019.
Ticket Corp., Registrant
By: /s/ Russell Rheingrover
Russell Rheingrover, CEO
Principal Executive Officer, Secretary and Director
By: /s/ Kristi Ann Nelson
Kristi Ann Nelson
CFO, Treasurer, Principal Financial Officer,
Principal Accounting Officer and Director
In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
/s/ Russell Rheingrover
Principal Executive Officer & Director
April 1, 2019
Russell Rheingrover
Title
Date
/s/ Kristi Ann Nelson
Principal Financial Officer & Director
April 1, 2019
Kristi Ann Nelson
Title
Date
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders of Ticket Corp.
Opinion on the Financial Statements
We have audited the accompanying balance sheets of Ticket Corp. (“the Company”) as of December 31, 2018 and 2017, and the related statements of operations, changes in shareholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2018, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2018 and 2017, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2018, in conformity with accounting principles generally accepted in the United States of America.
Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 4 to the financial statements, the Company has limited operations and has incurred continual losses resulting in a significant accumulated deficit. These factors raise substantial 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 4. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
TICKET CORP.
BALANCE SHEETS
The accompanying notes are an integral part of these financial statements
TICKET CORP.
STATEMENTS OF OPERATIONS
The accompanying notes are an integral part of these financial statements
TICKET CORP.
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
The accompanying notes are an integral part of these financial statements
TICKET CORP.
STATEMENTS OF CASH FLOWS
The accompanying notes are an integral part of these financial statements
Ticket Corp.
Notes to Financial Statements
December 31, 2018
(Audited)
NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS
Ticket Corp. (the Company) was incorporated under the laws of the State of Nevada on January 17, 2013. The Company was formed to become a provider of tickets, merchandise and social media communications driven primarily through its mobile application technology in the United States and a provider of premium seats and entrance to concerts, sporting events, theatre and entertainment, including corporate and group ticketing, special events and promotions worldwide.
The Company is in an active and operational stage. Its activities to date include but is not limited to capital formation, organization, application development, beta testing and launch as well as developing relationships with key product merchandisers and have populated the mobile app with available tickets and authentic merchandise to most major live events. The company is in the early stages of collecting revenue but is selling tickets and merchandise on its mobile application.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The accompanying audited financial statements of Ticket Corp. (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and the rules of the Securities and Exchange Commission. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein.
Basic Loss per Share
ASC No. 260, “Earnings per Share”, specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock. The Company has adopted the provisions of ASC No. 260.
Basic net loss per share amounts is computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted loss per share is the same as basic loss per share because the consideration of these shares would be anti-dilutive in periods of loss.
If the company issues all shares convertible under the terms of the loans payable to Russell Rheingrover (see Related Party Transactions) the number of shares to be issued to Mr. Rheingrover would be 2,837,620 for the principal balance and 656,028 for the accrued interest if it is converted to shares.
Cash Equivalents
The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.
Use of Estimates and Assumptions
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. In accordance with ASC No. 250 all adjustments are normal and recurring.
Ticket Corp.
Notes to Financial Statements
December 31, 2018
(Audited)
Income Taxes
Income taxes are provided in accordance with ASC No. 740, Accounting for Income Taxes. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carry-forwards. Deferred tax expense (benefit) results from the net change during the year of deferred tax assets and liabilities.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
Revenue
In accordance with ASC 605 the Company records revenue when all goods and services have been performed and delivered, the amounts are readily determinable, and collection is reasonably assured.
Reclassification
Certain balances from prior periods have been reclassified in these audited financial statements to conform to current period presentation. This had no impact on prior reported assets, equity, or operations.
Software Development Costs
The company expenses software development costs in accordance with FASB ASC 985-20-25. All costs incurred to establish the technological feasibility of a computer software product to be sold, leased, or otherwise marketed are research and development costs. Once technological feasibility has been reached, but not before it is released to the public, the cost incurred for software development can be capitalized and amortized after release. The company incurred no software development costs during the fiscal year ended December 31, 2018 and $65,594 during the fiscal year ended December 31, 2017.
Advertising Costs
The company expenses advertising costs as they are incurred. The company incurred no advertising costs during the fiscal years ended December 31, 2018 and 2017.
NOTE 3. RECENT ACCOUNTING PRONOUCEMENTS
The Financial Accounting Standards Board (“FASB”) periodically issues new accounting standards in a continuing effort to improve standards of financial accounting and reporting. The Company has reviewed the recently issued pronouncements.
In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606).” The new guidance provides new criteria for recognizing revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration to which the company expects to be entitled in exchange for those goods or services. The new guidance requires expanded disclosures to provide greater insight into both revenue that has been recognized and revenue that is expected to be recognized in the future from existing contracts. Quantitative and qualitative information will be provided about the significant judgments and changes in those judgments that management made to determine the revenue that is recorded. This accounting standard update, as amended, will be effective for annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. The new revenue standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. Early adoption is permitted, but no earlier than fiscal 2017. The Company is currently assessing the provisions of the guidance and has not determined the impact of the adoption of this guidance on its consolidated financial statements.
Ticket Corp.
Notes to Financial Statements
December 31, 2018
(Audited)
On June 20, 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018-07 is intended to reduce cost and complexity and to improve financial reporting for share-based payments to nonemployees (for example, service providers, external legal counsel, suppliers, etc.). ASU 2018-07 will be effective for public companies for December 31, 2019 financial statements and for nonpublic entities for December 31, 2020 financial statements. Early adoption is permitted, but no earlier than entity’s adoption date for ASC Topic 606, Revenue from Contracts with Customers. The Company is currently assessing the provisions of the guidance and has not determined the impact of the adoption of this guidance on its consolidated financial statements.
We are an “Emerging Growth Company,” as defined in the Jumpstart our Business Startups Act of 2012, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies. Emerging Growth Companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to avail ourselves to this exemption from new or revised accounting standards, which includes the adoption of ASU 2014-09.
NOTE 4. GOING CONCERN
The accompanying financial statements are presented on a going concern basis. The Company had limited operations during the period from January 17, 2013 (date of inception) through December 31, 2018 and a deficit of $429,370, or $0.009 per share. This condition raises substantial doubt about the Company’s ability to continue as a going concern. Management believes that the Company’s current cash of $4,394, anticipated revenues and loans from our director when needed will be sufficient to cover the expenses they will incur during the next twelve months in a limited operations scenario. Management believes that by following through with the Company’s plan of operation for the next 12 months that the revenue will increase to a point to support operations without loans from the director of the Company.
NOTE 5. RELATED PARTY TRANSACTIONS
The sole officer and two directors of the Company may, in the future, become involved in other business opportunities as they become available, they may face a conflict in selecting between the Company and their other business opportunities. The Company has not formulated a policy for the resolution of such conflicts.
As of December 31, 2018, $347,864 is owed to Russell Rheingrover, CEO. $100 of the funds were loaned by him to the Company to open the bank account and is non-interest bearing with no specific repayment terms. $5,375 of the funds were for payment of an outstanding balance to DDC for software development. The accrued interest payable of the Convertible Notes as outlined below was $54,247.
$35,000 of the funds are the result of a 10% Convertible Note issued on September 3, 2015. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by September 3, 2016 or is convertible at the conversion price of $0.05 per common stock share. On September 3, 2018, the terms of the Note were extended to September 2, 2019. The conversion price was considered by management to be a fair price.
$25,000 of the funds are the result of a 10% Convertible Note issued on October 5, 2015. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by October 5, 2016 or is convertible at the conversion price of $0.05 per common stock share. On October 5, 2018 the terms of the Note were extended to October 4, 2019. The conversion price was considered by management to be a fair price.
Ticket Corp.
Notes to Financial Statements
December 31, 2018
(Audited)
$35,000 of the funds are the result of a 10% Convertible Note issued on April 30, 2016. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by April 30, 2017 or is convertible at the conversion price of $0.10 per common stock share. On April 30, 2018, the terms of the Note were extended to April 30, 2019. The conversion price was considered by management to be a fair price.
$20,000 of the funds are the result of a 10% Convertible Note issued on September 8, 2016. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by September 8, 2017 or is convertible at the conversion price of $0.15 per common stock share. On September 8, 2018, the terms of the Note were extended to September 8, 2019. The conversion price was considered by management to be a fair price.
$30,000 of the funds are the result of a 10% Convertible Note issued on October 26, 2016. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by October 26, 2017 or is convertible at the conversion price of $0.15 per common stock share. On October 26, 2018, the terms of the Note were extended to October 26, 2019. The conversion price was considered by management to be a fair price.
$30,000 of the funds are the result of a 10% Convertible Note issued on January 6, 2017. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by January 6, 2018 or is convertible at the conversion price of $0.15 per common stock share. On January 6, 2018, the terms of the Note were extended to January 6, 2019. The conversion price was considered by management to be a fair price.
$10,000 of the funds are the result of a 10% Convertible Note issued on July 3, 2017. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by July 2, 2018 or is convertible at the conversion price of $0.15 per common stock share. On July 2, 2018, the terms of the Note were extended to July 2, 2019. The conversion price was considered by management to be a fair price. The conversion price was considered by management to be a fair price.
$5,000 of the funds are the result of a 10% Convertible Note issued on October 3, 2017. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by October 2, 2018 or is convertible at the conversion price of $0.15 per common stock share. On October 3, 2018, the terms of the Note were extended to October 2, 2019. The conversion price was considered by management to be a fair price.
$53,000 of the funds are the result of a 10% Convertible Note issued on March 30, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by March 29, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
$36,876 of the funds are the result of a 10% Convertible Note issued on June 30, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by June 30, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
$3,599 of the funds are the result of a 10% Convertible Note issued on September 30, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by September 30, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
$4,668 of the funds are the result of a 10% Convertible Note issued on December 22, 2018. Under the terms of the note the principal sum and interest is to be repaid to Mr. Rheingrover by December 21, 2019 or is convertible at the conversion price of $0.15 per common stock share. The conversion price was considered by management to be a fair price.
Ticket Corp.
Notes to Financial Statements
December 31, 2018
(Audited)
Mr. Rheingrover, who currently owns 69% of our outstanding voting stock, is also the Chief Executive Officer of Jiffy Tickets, a national reseller of concert, theater, sporting and event tickets. He currently devotes approximately 5 hours of his business time to our affairs and the balance to Jiffy Tickets. He owes a fiduciary duty of loyalty to us, but also owes similar fiduciary duties to Jiffy Tickets. Due to his responsibilities to serve both companies, there is potential for conflicts of interest. He will use every effort to avoid material conflicts of interest generated by his responsibilities to both companies, but no assurance can be given that material conflicts will not arise which could be detrimental to our operations and financial prospects.
NOTE 6. STOCK TRANSACTIONS
On January 31, 2013, the Company issued a total of 33,000,000 shares of common stock to its sole officer Russell Rheingrover for cash in the amount of $0.001 per share for a total of $33,000.
The company’s Registration Statement on Form S-1 was declared effective on July 25, 2014. In October 2014 the company sold 15,000,000 shares of common stock to 50 independent shareholders at a price of $0.033 per share for total proceeds of $49,500, pursuant to the Registration Statement.
As of December 31, 2018, the Company had 48,000,000 shares of common stock issued and outstanding.
NOTE 7. STOCKHOLDERS’ EQUITY
The stockholders’ equity section of the Company contains the following classes of capital stock as of December 31, 2018:
Common stock, $ 0.001 par value: 100,000,000 shares authorized; 48,000,000 shares issued and outstanding.
NOTE 8. PROVISION FOR INCOME TAXES
Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carry-forwards are expected to be available to reduce taxable income. As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance. As of December 31, 2018, the Company had a net operating loss carry-forward of approximately $429,370. Net operating loss carry-forward, expires twenty years from the date the loss was incurred.
The Company is subject to United States federal and state income taxes at an approximate rate of 21%. The reconciliation of the provision for income taxes at the United States federal statutory rate compared to the Company’s income tax expense as reported is as follows:
Ticket Corp.
Notes to Financial Statements
December 31, 2018
(Audited)
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Deferred income taxes arise from temporary differences in the recognition of income and expenses for financials reporting and tax purposes. The significant components of deferred income tax assets and liabilities at December 31, 2018 are as follows:
The Company has recognized a valuation allowance for the deferred income tax asset since the Company cannot be assured that it is more likely than not that such benefit will be utilized in future years. The valuation allowance is reviewed annually. When circumstances change and which cause a change in management’s judgment about the realizability of deferred income tax assets, the impact of the change on the valuation allowance is generally reflected in current income.
The Tax Cuts and Jobs Act enacted on December 22, 2017, reduced the U.S. federal corporate tax rate from 35% to 21%. The Company has not yet completed its full accounting for the effect of the Act and is therefore providing an estimate of the anticipated effect. The most substantial impact is the reduction of the existing deferred tax benefit by $31,400 as of December 31, 2017 due to the decrease in future tax rates.
NOTE 9. SUBSEQUENT EVENTS
The Company evaluated all other events or transactions that occurred after December 31, 2018 up through date the Company issued these financial statements and found no subsequent event that needed to be reported.