U.S.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
AMENDMENT
NO. 1 TO
FORM
10-QSB
x
QUARTERLY
REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF
THE
SECURITIES EXCHANGE ACT OF 1934
For
the
quarterly period ended December 31, 2007
OR
o
TRANSITION
REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF
THE
SECURITIES EXCHANGE ACT OF 1934
For
the
transition period from _________ to __________
INTERNET
INFINITY, INC.
(Exact
name of registrant as specified in its charter)
Commission
File No. 0-27633
State
of
Incorporation: Nevada
IRS
Employer I.D. Number: 95-4679342
413
Avenue G, # 1
Redondo
Beach, California 90277
Telephone
310-318-2244
(Address
and telephone number of registrant’s principal
executive
offices and principal place of business)
Check
whether the issuer (1) filed all reports required to be filed by Section 13
or
15(d) of the Exchange Act during the past twelve months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been
subject to such filing requirements for the past 90 days. Yes
x
No
o
As
of
February 12, 2008, there were 28,718,780 shares of the Registrant’s Common
Stock, par value $0.001 per share, outstanding.
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes
x
No
o
Transitional
Small Business Disclosure Format (check one): Yes
o
No
x
TABLE
OF CONTENTS
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Page
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PART
I - FINANCIAL INFORMATION
|
3
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|
|
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Item
1.
|
Financial
Statements
|
3
|
|
|
|
Item
2.
|
Management’s
Discussion and Analysis or Plan of Operation
|
14
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|
|
|
Item
3.
|
Controls
and Procedures
|
16
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|
|
|
PART
II - OTHER INFORMATION
|
16
|
|
|
|
Item
1.
|
Legal
Proceedings
|
16
|
|
|
|
Item
2.
|
Unregistered
Sales of Equity Securities
|
16
|
|
|
|
Item
3.
|
Defaults
Upon Senior Securities
|
16
|
|
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
17
|
|
|
|
Item
5.
|
Other
Information
|
17
|
|
|
|
Item
6.
|
Exhibits
|
17
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|
|
|
SIGNATURES
|
18
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PART
I - FINANCIAL INFORMATION
Item
1.
Financial
Statements
|
|
Page
|
|
|
|
|
|
Balance
Sheet (Unaudited) at December 31, 2007
|
|
|
4
|
|
Statements
of Operations (Unaudited) for the Three Month and Nine Month Periods
Ended
December 31, 2007 and 2006
|
|
|
5
|
|
Statements
of Cash Flows (Unaudited) for the Nine Month Periods
Ended December 31, 2007 and 2006
|
|
|
6
|
|
Notes
to Unaudited Financial Statements
|
|
|
7
|
|
BALANCE
SHEET
DECEMBER
31, 2007
(Unaudited)
ASSETS
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
Cash
& cash equivalents
|
|
$
|
605
|
|
Total
assets
|
|
|
605
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
Accounts
payable & accrued expenses
|
|
|
172,863
|
|
Note
payable
|
|
|
27,000
|
|
Note
payable - related parties
|
|
|
293,603
|
|
Due
to officer
|
|
|
197,619
|
|
Due
to related party
|
|
|
106,030
|
|
Total
current liabilities
|
|
|
797,114
|
|
|
|
|
|
|
STOCKHOLDERS'
DEFICIT
|
|
|
|
|
Preferred
stock, $.001 par value; 30,000,000 shares authorized,
none
outstanding
|
|
|
-
|
|
Common
stock, $.001 par value; 100,000,000 shares authorized,
28,718,780
outstanding
|
|
|
28,720
|
|
Additional
paid in capital
|
|
|
975,451
|
|
Accumulated
deficit
|
|
|
(1,800,680
|
)
|
Total
stockholders' deficit
|
|
|
(796,509
|
)
|
Total
liabilities and stockholders' deficit
|
|
$
|
605
|
|
The
accompanying notes are an integral part of these unaudited financial
statements
STATEMENTS
OF OPERATIONS
(Unaudited)
|
|
For
the Three Month Periods
|
|
For
the Nine Month Periods
|
|
|
|
Ended
December 31,
|
|
Ended
December 31,
|
|
|
|
2007
|
|
2006
|
|
2007
|
|
2006
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenues
|
|
$
|
-
|
|
$
|
1,116
|
|
$
|
3,805
|
|
$
|
5,411
|
|
Cost
of sales
|
|
|
-
|
|
|
893
|
|
|
3,044
|
|
|
4,329
|
|
Gross
profit
|
|
|
-
|
|
|
223
|
|
|
761
|
|
|
1,082
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Professional
fees
|
|
|
6,758
|
|
|
6,998
|
|
|
15,756
|
|
|
19,831
|
|
Salaries
and related expenses
|
|
|
6,515
|
|
|
7,663
|
|
|
19,544
|
|
|
22,989
|
|
Consulting
fees to related party
|
|
|
1,500
|
|
|
-
|
|
|
4,500
|
|
|
|
|
Others
|
|
|
4,853
|
|
|
5,147
|
|
|
15,161
|
|
|
14,404
|
|
Total
operating expenses
|
|
|
19,625
|
|
|
19,808
|
|
|
54,961
|
|
|
57,224
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
from operations
|
|
|
(19,625
|
)
|
|
(19,585
|
)
|
|
(54,200
|
)
|
|
(56,142
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
(9,593
|
)
|
|
(12,119
|
)
|
|
(28,169
|
)
|
|
(35,852
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
before income taxes
|
|
|
(29,218
|
)
|
|
(31,704
|
)
|
|
(82,369
|
)
|
|
(91,994
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision
for income taxes
|
|
|
-
|
|
|
800
|
|
|
800
|
|
|
800
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
$
|
(29,218
|
)
|
$
|
(32,504
|
)
|
$
|
(83,169
|
)
|
$
|
(92,794
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
and diluted weighted average number of common stock
outstanding
|
|
|
28,718,780
|
|
|
18,936,171
|
|
|
28,718,780
|
|
|
18,791,773
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
and diluted net loss per share
|
|
$
|
(0.00
|
)
|
$
|
(0.00
|
)
|
$
|
(0.00
|
)
|
$
|
(0.00
|
)
|
Weighted
average number of shares used to compute basic and diluted loss per share
is the
same as the effect of dilutive securities is anti-dilutive.
The
accompanying notes are an integral part of these unaudited financial
statements
STATEMENTS
OF CASH FLOWS
FOR
THE NINE MONTH PERIODS ENDED DECEMBER 31, 2007 AND 2006
(Unaudited)
|
|
2007
|
|
2006
|
|
|
|
|
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
Net
loss
|
|
$
|
(83,169
|
)
|
$
|
(92,793
|
)
|
Adjustments
to reconcile net loss to net cash used in
operating
activities:
|
|
|
|
|
|
|
|
Changes
in assets and liabilities:
|
|
|
|
|
|
|
|
Accounts
payable and accrued expenses
|
|
|
29,448
|
|
|
4,518
|
|
Net
cash used in operating activities
|
|
|
(53,721
|
)
|
|
(88,275
|
)
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
Increase/
(decrease) in due to related company
|
|
|
22,783
|
|
|
54,558
|
|
Receipts
from officer
|
|
|
26,680
|
|
|
15,997
|
|
Proceeds
from shares issued
|
|
|
-
|
|
|
22,000
|
|
Proceeds
from notes payable - related party
|
|
|
3,600
|
|
|
-
|
|
Net
cash provided by financing activities
|
|
|
53,063
|
|
|
92,555
|
|
|
|
|
|
|
|
|
|
NET
INCREASE (DECREASE) IN CASH & CASH EQUIVALENTS
|
|
|
(658
|
)
|
|
4,280
|
|
|
|
|
|
|
|
|
|
CASH
& CASH EQUIVALENTS, BEGINNING BALANCE
|
|
|
1,263
|
|
|
1,225
|
|
|
|
|
|
|
|
|
|
CASH
& CASH EQUIVALENTS, ENDING BALANCE
|
|
$
|
605
|
|
$
|
5,505
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTARY
DISCLOSURES OF CASH FLOW INFORMATION:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
paid
|
|
$
|
|
|
$
|
|
|
Taxes
paid
|
|
$
|
-
|
|
$
|
-
|
|
The
accompanying notes are an integral part of these unaudited financial
statements
INTERNET
INFINITY, INC.
NOTES
TO UNAUDITED FINANCIAL STATEMENTS
Internet
Infinity, Inc. (III or “the Company”) was incorporated in the State of Delaware
on October 27, 1995. III is in the business of distribution of electronic
media
replication services and the creation of replication masters. The Company
was
re-incorporated in Nevada on December 17, 2004.
NOTE
2
|
BASIS
OF PRESENTATION AND
BUSINESS
|
The
accompanying financial statements have been prepared by Internet Infinity
Inc.
(the Company), without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to
such
rules and regulations, although the Company believes that the disclosures
included herein are adequate to make the information presented not misleading.
The unaudited financial statements reflect all adjustments, consisting only
of
normal recurring adjustments, which are, in the opinion of management, necessary
to fairly state the financial position as of December 31, 2007, and the results
of operations and cash flows for the related interim periods ended December
31,
2007 and 2006. The results of operations for the for the nine month periods
ended December 31, 2007, are not necessarily indicative of the results that
may
be expected for the year ended March 31, 2008, or any other period.
The
accounting policies followed by the Company and other information are contained
in the notes to the Company’s financial statements filed on July 3, 2007, as
part of the Company’s annual report on Form 10-KSB for the year ended March 31,
2007. This quarterly report should be read in conjunction with such annual
report.
Use
of estimates
The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements
and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Reclassifications
Certain
comparative amounts have been reclassified to conform to the current period's
presentation.
INTERNET
INFINITY, INC.
NOTES
TO UNAUDITED FINANCIAL STATEMENTS
Recent
Pronouncements
In
September 2006, FASB issued SFAS 157 ‘Fair Value Measurements’. This Statement
defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles (GAAP), and expands disclosures
about
fair value measurements. This Statement applies under other accounting
pronouncements that require or permit fair value measurements, the Board
having
previously concluded in those accounting pronouncements that fair value is
the
relevant measurement attribute. Accordingly, this Statement does not require
any
new fair value measurements. However, for some entities, the application
of this
Statement will change current practice. This Statement is effective for
financial statements issued for fiscal years beginning after November 15,
2007,
and interim periods within those fiscal years. The management is currently
evaluating the effect of this pronouncement on financial
statements.
In
September 2006, FASB issued SFAS 158 ‘Employers’ Accounting for Defined Benefit
Pension and Other Postretirement Plans—an amendment of FASB Statements No. 87,
88, 106, and 132(R)’ This Statement improves financial reporting by requiring an
employer to recognize the overfunded or underfunded status of a defined benefit
postretirement plan (other than a multiemployer plan) as an asset or liability
in its statement of financial position and to recognize changes in that funded
status in the year in which the changes occur through comprehensive income
of a
business entity or changes in unrestricted net assets of a not-for-profit
organization. This Statement also improves financial reporting by requiring
an
employer to measure the funded status of a plan as of the date of its year-end
statement of financial position, with limited exceptions. An employer with
publicly traded equity securities is required to initially recognize the
funded
status of a defined benefit postretirement plan and to provide the required
disclosures as of the end of the fiscal year ending after December 15, 2006.
An
employer without publicly traded equity securities is required to recognize
the
funded status of a defined benefit postretirement plan and to provide the
required disclosures as of the end of the fiscal year ending after June 15,
2007. However, an employer without publicly traded equity securities is required
to disclose the following information in the notes to financial statements
for a
fiscal year ending after December 15, 2006, but before June 16, 2007, unless
it
has applied the recognition provisions of this Statement in preparing those
financial statements:
a.
|
A
brief description of the provisions of this Statement
|
b.
|
The
date that adoption is required
|
c.
|
The
date the employer plans to adopt the recognition provisions of
this
Statement, if earlier.
|
The
requirement to measure plan assets and benefit obligations as of the date
of the
employer’s fiscal year-end statement of financial position is effective for
fiscal years ending after December 15, 2008. The management is currently
evaluating the effect of this pronouncement on financial
statements.
INTERNET
INFINITY, INC.
NOTES
TO UNAUDITED FINANCIAL STATEMENTS
In
February 2007, FASB issued FASB Statement No. 159, The Fair Value Option
for
Financial Assets and Financial Liabilities. FAS 159 is effective for fiscal
years beginning after November 15, 2007. Early adoption is permitted subject
to
specific requirements outlined in the new Statement. Therefore, calendar-year
companies may be able to adopt FAS 159 for their first quarter 2007 financial
statements.
The
new
Statement allows entities to choose, at specified election dates, to measure
eligible financial assets and liabilities at fair value that are not otherwise
required to be measured at fair value. If a company elects the fair value
option
for an eligible item, changes in that item's fair value in subsequent reporting
periods must be recognized in current earnings. FAS 159 also establishes
presentation and disclosure requirements designed to draw comparison between
entities that elect different measurement attributes for similar assets and
liabilities. The management is currently evaluating the effect of this
pronouncement on financial statements.
In
December 2007, the FASB issued SFAS No. 141 (Revised 2007), “Business
Combinations”. The objective of this statement will significantly change the
accounting for business combinations. Under Statement 141R, an acquiring
entity
will be required to recognize all the assets acquired and liabilities assumed
in
a transaction at the acquisition -date fair value will limited exceptions.
Statement 141 applies prospectively to business combinations for which the
acquisition date is on or after the beginning of the first annual reporting
period beginning on or after December 15, 2008. The Company does not expect
the
adoption of SFAS No. 141R to have a material impact on the consolidated
financial statements.
In
December 2007, FASB issued FASB Statement No. 160, Noncontrolling Interests
in
Consolidated Financial Statements—an amendment of ARB No. 51. This Statement
applies to all entities that prepare consolidated financial statements, except
not-for-profit organizations, but will affect only those entities that have
an
outstanding non-controlling interest in one or more subsidiaries or that
deconsolidate a subsidiary. Not-for-profit organizations should continue
to
apply the guidance in Accounting Research Bulletin No. 51, Consolidated
Financial Statements, before the amendments made by this Statement, and any
other applicable standards, until the Board issues interpretative guidance.
This
Statement is effective for fiscal years, and interim periods within those
fiscal
years, beginning on or after December 15, 2008 (that is, January 1, 2009,
for
entities with calendar year-ends). Earlier adoption is prohibited. The effective
date of this Statement is the same as that of the related Statement 141(R).
This
Statement shall be applied prospectively as of the beginning of the fiscal
year
in which this Statement is initially applied, except for the presentation
and
disclosure requirements. The presentation and disclosure requirements shall
be
applied retrospectively for all periods presented. This is statement has
no
effect on the financial statements as the Company does not have any outstanding
non-controlling interest.
INTERNET
INFINITY, INC.
NOTES
TO UNAUDITED FINANCIAL STATEMENTS
The
Company's financial statements are prepared using the generally accepted
accounting principles applicable to a going concern, which contemplates the
realization of assets and liquidation of liabilities in the normal course
of
business. However, the Company has incurred significant losses and has an
accumulated deficit of $1,800,680 at December 31, 2007. The Company has a
net
loss of $83,169 for the nine month period ended December 31, 2007.
In
view
of the matters described above, recoverability of a major portion of the
recorded asset amounts shown in the accompanying balance sheets is dependent
upon continued operations of the Company, which in turn is dependent upon
the
Company’s ability to raise additional capital, obtain financing and to succeed
in its future operations. The financial statements do not include any
adjustments relating to the recoverability and classification of recorded
asset
amounts or amounts and classification of liabilities that might be necessary
should the Company be unable to continue as a going concern.
Management
has taken the following steps to revise its operating and financial
requirements, which it believes are sufficient to provide the Company with
the
ability to continue as a going concern. The Company is actively pursuing
additional funding and potential merger or acquisition candidates and strategic
partners, which would enhance stockholders’ investment. Management believes that
the above actions will allow the Company to continue operations through the
next
fiscal year.
NOTE
4
|
ACCOUNT
PAYABLE & ACCRUED
EXPENSES
|
Accrued
expenses consist of the following at December 31, 2007:
Accrued
taxes
|
|
$
|
4,000
|
|
Accrued
interest
|
|
|
122,671
|
|
Accrued
legal and accounting
|
|
|
3,500
|
|
Accounts
payable
|
|
|
42,692
|
|
|
|
$
|
172,863
|
|
Notes
payable related to various unrelated parties total amounting to $27,000.
The
notes are due upon 90 days written notice from the note holders. The notes
are
unsecured, with interest ranging from 6% to 12% payable quarterly. The notes
have been outstanding since 1990. Interest expense for the three month periods
ended December 31, 2007 and 2006 was $660 and $660. Interest expense for
the
nine month periods ended December 31, 2007 and 2006 was $1,980 and $1,980.
The
Company has not paid interest on the notes during the nine month period ended
December 31, 2007.
INTERNET
INFINITY, INC.
NOTES
TO UNAUDITED FINANCIAL STATEMENTS
NOTE
6
|
RELATED
ENTITIES TRANSACTIONS
|
George
Morris is chief financial officer, vice president, the chairman of the Board
of
directors of the Company and the controlling shareholder of the Company and
its
related parties through his beneficial ownership of the following percentages
of
the outstanding voting shares of the related parties:
Internet
Infinity, Inc. (The Company)
|
|
|
85.10
|
%
|
Morris
& Associates, Inc.
|
|
|
71.30
|
%
|
Morris
Business Development Company
|
|
|
82.87
|
%
|
Apple
Realty, Inc.
|
|
|
100.00
|
%
|
L&M
Media, Inc.
|
|
|
100.00
|
%
|
The
Company has notes payable to related parties on December 31,, 2007 as
follows:
Notes
payable to:
|
|
|
|
|
|
Anna
Moras
(mother of George Morris), with interest at 6% per annum,
due
upon 90 days written notice. Interest expense for the quarter ended
December 31, 2007 and 2006 on this note are $459 and $432 respectively.
Interest expense for the nine month periods ended December 31,
2007 and
2006 on this note are $1,368 and $1,344 respectively. No interest
has been
paid as of the date of this report.
|
|
|
|
|
$
|
14,652
|
|
|
|
|
|
|
|
|
|
Apple
Realty, Inc.
(related through a common controlling shareholder), secured by
assets of
the Company, past due and payable upon demand. Interest accrues
at 6% per
annum. This note is in connection with consulting fees and office
expenses
owed. Interest expense on this note for the quarter ended December
31,
2007 and 2006 are $4,984 and $4,626 respectively. Interest expense
on this
note for the nine month periods ended December 31, 2007 and 2006
are
$14,052 and $13,581 respectively. No interest has been paid as
of the date
of this report.
|
|
|
|
|
|
243,196
|
|
|
|
|
|
|
|
|
|
L&M
Media, Inc.
(related through a common controlling shareholder) -
Accounts payable for purchases, converted into a note during the
three
month period ended June 30, 2004. The note is due on demand, unsecured
and
interest accrues at 6% per annum. Interest expense on this note
for the
quarter ended December 31, 2007 and 2006 are $691 and $651 respectively.
Interest expense on this note for the nine month periods ended
December
31, 2007 and 2006 are $2,043 and $2,020 respectively. No interest
has been
paid as of the date of this report.
|
|
|
|
|
|
35,755
|
|
|
|
|
|
|
|
|
|
Total
notes payable – related parties
|
|
|
|
|
$
|
293,603
|
|
INTERNET
INFINITY, INC.
NOTES
TO UNAUDITED FINANCIAL STATEMENTS
The
Company utilizes office space, telephone and utilities provided by Apple
Realty,
Inc. at estimated fair market values, as follows:
|
|
Monthly
|
|
Annually
|
|
Rent
|
|
$
|
100
|
|
$
|
1,200
|
|
Telephone
|
|
|
100
|
|
|
1,200
|
|
Utilities
|
|
|
100
|
|
|
1,200
|
|
Office
Expense
|
|
|
100
|
|
|
1,200
|
|
|
|
$
|
400
|
|
$
|
4,800
|
|
The
Company has a month-to-month agreement with Apple Realty, Inc. for a total
monthly fee of $400 for the above expenses.
The
Company has a payable to officer of $197,619 as of December 31, 2007 as
follows:
As
of December 31, 2007
|
|
Classification
|
|
Amount
|
|
|
|
|
|
|
|
Officer
draw/payable
|
|
|
Current
|
|
$
|
128,638
|
|
Note
payable
|
|
|
Current
|
|
|
63,433
|
|
Interest
payable
|
|
|
Current
|
|
|
5,548
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
197,619
|
|
Unsecured
miscellaneous payables upon demand to the chairman with interest at 6% per
annum.
INTERNET
INFINITY, INC.
NOTES
TO UNAUDITED FINANCIAL STATEMENTS
The
Company has a payable to Morris Business Development Company and Morris &
Associates, Inc., parties related through a common controlling shareholder,
amounting to $98,820 and $7,209 respectively, as of December 31, 2007. The
amounts are temporary loans in the normal course of business, interest free,
unsecured and due on demand.
NOTE
7
|
CONCENTRATIONS
OF CREDIT RISK
|
For
the
nine month periods ended December 31, 2007 and 2006, revenue from one customer
represents 100% and 100% of the Company’s total revenue respectively. As of
December 31, 2007, the receivable from this customer amounted to
$0.
For
the
nine month periods ended December 31, 2007 and 2006, the Company has one
vendor
who represents 100% of total purchases. Accounts payable balance outstanding
as
of December 31, 2007 for this supplier was $0.
Item
2.
Management’s
Discussion and Analysis or Plan of Operation
The
following discussion and analysis should be read in conjunction with the
financial statements and the accompanying notes thereto for the three-month
period ended December 31, 2007 and is qualified in its entirety by the foregoing
and by more detailed financial information appearing elsewhere. See “Item 1.
Financial Statements.” The discussion includes management’s expectations for the
future.
Results
of Operations – Third Quarter (“Q3”) of Fiscal 2008 Compared to Third
Quarter (“Q3”) of Fiscal 2008
Sales
Internet
Infinity revenues for Q3 2008 were $0 as compared with revenues of $1,116 in
Q3
2007. This 100% decrease in sales is attributable to a ceasing to offer
mastering electronic media due to a market shift to the online Internet delivery
of information. Also, the company is in a transition period to develop an
internet accelerator as opposed to selling the company in a merger.
Cost
of Sales - Gross Margin
Our
cost
of sales was $0 for Q3 2008, as compared to $893 for Q3 2007 (80% of sales).
Any
increase in the percentage cost of sales and reduction in margin reflects an
adjustment in the cost of DVD mastering provided by outside vendors without
the
company’s ability to pass along the higher costs.
Operating
Expenses
Operating
expenses for Q3 2008 decreased to $19,625 from $19,809 (1700% of sales) for
Q3
2007. This decrease in operating expenses is primarily due to a decrease in
consulting expense and an increase in other expenses.
Net
Income (Loss)
The
company had a net loss of $29,218 in Q3 2008, as compared with a net loss of
$32,504 (303% of sales) in Q3 2007.
Balance
Sheet Items
Our
cash
position decreased to $605 at December 31, 2007 (Q3 2008) by $4,900 from $5,505
at December 31, 2006 (Q3 2007).
Results
of Operations – First Nine Months of Fiscal Year 2008 Compared to First
Nine Months of Fiscal Year 2007
.
Internet
Infinity revenues for the first nine months of FY 2008 were $3,805, a $1,606
or
30% decrease in revenues from $5,411 in the first nine months of FY 2007. The
decrease in sales was attributable to a decrease in sales from our largest
customer that had an unusually large increase in the prior year.
Cost
of Sales - Gross Margin
Our
cost
of sales decreased to $3,044 for the first nine months of FY 2008, or 80% of
sales, as compared with $4,329 for the first nine months of FY 2007, or 80%
of
sales. This set
percentage
in
the
cost of sales is due to a set percentage cost from our supplier and a change
in
services provided of the authoring of electronic media services.
Operating
Expenses
Operating
expenses for the first nine months of FY 2008 decreased to $54,961 or 1090%
of
sales, from $57,224, or 226% of sales, for the first nine months of FY 2007.
This decrease in operating expenses is primarily due to a decrease of $5,390
in
professional fees and an $830 decrease in other expenses.
Net
Income (Loss)
We
had a
net loss of $83,169 in the first nine months of FY 2008 as compared with a
net
loss of $92,793 in the first nine months of FY 2007. The net loss for the first
nine months of 2008 is attributable to significantly lower sales.
Financial
Conditions
At
December 31, 2007 we had a working capital deficit of $796,509 consisting of
current assets totaling $605 and current liabilities totaling $797,114. The
December 31, 2007 working capital deficit decreased by $120,719 as compared
to
the December 31, 2006 working capital deficit balance of $675,790. The reduction
in the working capital deficit was primarily due to an additional investment
in
cash from and a reduction in loans payable to George Morris, chairman of our
company.
Off-Balance
Sheet Arrangements
Our
company has not entered into any transaction, agreement or other contractual
arrangement with an entity unconsolidated with us under which we have
·
|
an
obligation under a guarantee contract,
|
·
|
a
retained or contingent interest in assets transferred to the
unconsolidated entity or similar arrangement that serves as credit,
liquidity or market risk support to such entity for such
assets,
|
·
|
any
obligation, including a contingent obligation, under a contract that
would
be accounted for as a derivative instrument, or
|
·
|
any
obligation, including a contingent obligation, arising out of a variable
interest in an unconsolidated entity that is held by us and material
to us
where such entity provides financing, liquidity, market risk or credit
risk support to, or engages in leasing, hedging or research and
development services with us.
|
Item
3.
|
|
Controls
and Procedures
|
Evaluation
of disclosure controls and procedures
.
The
Company carried out an evaluation, under the supervision and with the
participation of the Company's management, including the Company's Chief
Executive Officer and Chief Financial Officer, of the effectiveness of the
design and operation of the Company's disclosure controls and procedures as
of
the end of the period covered by this report. Based upon that evaluation, the
Chief Executive Officer and Chief Financial Officer concluded that the Company's
disclosure controls and procedures are effective and are designed to provide
reasonable assurances of achieving their objectives.
Further,
the Company’s
officers
concluded that its disclosure controls and procedures are also effective to
ensure that information required to be disclosed in the reports that it files
or
submits under the Exchange Act is accumulated and communicated to its
management, including its chief executive officer and chief financial officer,
to allow timely decisions regarding required disclosure.
There
were no significant changes in the Company's internal control over financial
reporting during the period covered by this report that have materially
affected, or are reasonably likely to materially affect our internal controls
over financial reporting.
Internal
control over financial reporting.
Management’s
annual report on internal control over financial reporting
.
The
registrant’s management recognizes its responsibility for establishing and
maintaining adequate internal control over financial reporting for the
registrant. Currently, the registrant is operating as a caretaker entity,
keeping the corporation alive and in good standing with the Commission. All
debit and credit transactions with the company’s bank accounts are reviewed by
the officers as well as all communications with the company’s creditors. The
directors meet frequently - as often as weekly - to discuss and review the
financial status of the company and all developments regarding its search for
a
reverse merger partner. All filings of reports with the Commission are reviewed
before filing by all directors.
Management
assesses the company’s control over financial reporting at the end of its most
recent fiscal year to be effective. It detects no material weaknesses in the
company’s internal control over financial reporting.
This
annual report does not include an attestation report of the company’s registered
public accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by the company’s registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit the company to provide only management’s report
in this annual report.
There
has
been no change in our internal control over financial reporting identified
in
connection with the evaluation required by Commission rules that occurred during
our last fiscal quarter that has materially affected, or is reasonably likely
to
materially affect, our internal control over financial reporting.
PART
II - OTHER INFORMATION
Item
1.
|
|
Legal
Proceedings
|
We
are
not, and none of our property is, a party to any pending legal proceedings,
and
no such proceedings are known to be contemplated.
No
director, officer or affiliate of the company, and no owner of record or
beneficial owner of more than 5.0% of the securities of the company, or any
associate of any such director, officer or security holder is a party adverse
to
the company or has a material interest adverse to the Company in reference
to
any litigation.
Item
2.
|
|
Unregistered
Sales of Equity Securities
|
None.
Item
3.
|
|
Defaults
Upon Senior Securities
|
None.
Item
4.
|
|
Submission
of Matters to a Vote of Security
Holders
|
None.
Item
5.
|
|
Other
Information
|
None.
Item
6.
Exhibits
and Reports on Form 8-K
The
following exhibits are filed, by incorporation by reference, as part of this
Form 10-QSB:
2
|
Certificate
of Ownership and Merger of Morris & Associates, Inc., a
California corporation, into Internet Infinity, Inc., a Delaware
corporation*
|
|
|
2.1
|
Plan
of Merger (Internet Infinity - Delaware into Internet Infinity
-
Nevada)***
|
|
|
2.2
|
State
of Delaware Certificate of Merger of Domestic Corporation into
Foreign
Corporation which merges Internet Infinity, Inc., a Delaware corporation,
with and into Internet Infinity, Inc., a Nevada
corporation***
|
|
|
2.3
|
Articles
of Merger (Pursuant to NRS 92A.200) which merges Internet Infinity,
Inc.,
a Delaware corporation, with Internet Infinity, Inc., a Nevada
corporation, with the Nevada corporation being the surviving
entity***
|
|
|
3
|
Articles
of Incorporation of Internet Infinity, Inc.*
|
|
|
3.1
|
Amended
Certificate of Incorporation of Internet Infinity,
Inc.*
|
|
|
3.2
|
Bylaws
of Internet Infinity, Inc.*
|
|
|
3.3
|
Corporate
Charter and Articles of Incorporation of Internet Infinity, Inc.,
a Nevada
corporation***
|
|
|
3.4
|
Certificate
of Amendment to Articles of Incorporation of Internet Infinity,
Inc., a
Nevada corporation++
|
|
|
10.1
|
Master
License and non-exclusive Distribution Agreement between Internet
Infinity, Inc. and Lord & Morris Productions,
Inc.*
|
|
|
10.2
|
Master
License and Exclusive Distribution Agreement between L&M Media, Inc.
and Internet Infinity, Inc.*
|
|
|
10.3
|
Master
License and Exclusive Distribution Agreement between Hollywood
Riviera
Studios and Internet Infinity, Inc.*
|
|
|
10.4
|
Fulfillment
Supply Agreement between Internet Infinity, Inc. and Ingram Book
Company**
|
|
|
14
|
Code
of Ethics for CEO and Senior Financial Officers+
|
|
|
31
|
Certification
of Chief Executive Officer pursuant to 18 U.S.C. Section 1350,
as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
|
|
|
31.1
|
Certification
of Chief Financial Officer pursuant to 18 U.S.C. Section 1350,
as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
|
|
|
32
|
Certification
of Chief Executive Officer pursuant to 18 U.S.C. Section 1350,
as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
|
32.1
|
Certification
of Chief Financial Officer pursuant to 18 U.S.C. Section 1350,
as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
*Previously
filed with Form 10-SB 10-13-99; Commission File No. 0-27633 incorporated
herein.
|
|
**Previously
filed with Amendment No. 2 to Form 10-SB 02-08-00; Commission File
No.
0-27633 incorporated herein.
|
|
***Previously
filed with Form 8-K Current Report March 14, 2005, Commission File
No.
0-27633 incorporated herein.
|
|
+Previously
filed with Form 10-KSB; Commission File No. 0-27633 incorporated
herein.
|
|
++Previously
filed with Form 8-K Current Report February 17, 2006;
Commission
File No. 0-27633 incorporated
herein.
|
SIGNATURES
Pursuant
to the requirements of the Exchange Act of 1934, the Registrant has caused
this
report to be signed on its behalf by the undersigned hereunto duly
authorized.
|
INTERNET
INFINITY, INC.
|
|
|
|
By
|
/s/
Roger Casas
|
|
|
Roger Casas, Chief Executive Officer
|
Grafico Azioni Internet Infinity (PK) (USOTC:ITNF)
Storico
Da Ago 2024 a Set 2024
Grafico Azioni Internet Infinity (PK) (USOTC:ITNF)
Storico
Da Set 2023 a Set 2024