XFRA:M6C1 Quarterly Report 10-Q Filing - 6/30/2012

Effective Date 6/30/2012



U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
Form 10-Q
Mark One
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 
For the period ended June 30, 2012

o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 
For the transition period from ______ to _______

Commission File No. 000-52139
 
TagLikeMe Corp.
(formerly Morgan Creek Energy Corp)
(Name of small business issuer in its charter)
 
Nevada
 
201777817
(State or other jurisdiction of incorporation or organization)
 
(I.R.S. Employer Identification No.)
 
Third Floor, 7-8 Conduit Street, Mayfair, London W1S 2XF, UK
(Address of principal executive offices)
      
      
(011)-44-2072096919
(Issuer’s telephone number)
 
Securities registered pursuant to Section 12(b) of the Act:
 
Name of each exchange on which registered:
     
None
   
      
 
      
Securities registered pursuant to Section  12(g) of the Act:
   
     
Common Stock, $0.001
   
(Title of Class)
   
 
Indicate by checkmark whether the issuer: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes x   No o
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files.    Yes o   No x
 
Indicate by check mark whether the registrant is a large accelerated filed, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
 
Large accelerated filer o Accelerated filer o
       
Non-accelerated filer o Smaller reporting company x
 
Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o   No x
 
Applicable Only to Issuer Involved in Bankruptcy Proceedings During the Preceding Five Years.
 
N/A
 
Indicate by checkmark whether the issuer has filed all documents and reports required to be filed by Section 12, 13 and 15(d) of the Securities Exchange Act of 1934 after the distribution of securities under a plan confirmed by a court.  Yes o  No o
 
Applicable Only to Corporate Registrants
 
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the most practicable date:
 
Class
Outstanding as of  August 19, 2012
Common Stock, $0.001
330,940,630
 


 
 

 
 
TAGLIKEME CORP.
 
Form 10-Q

Part 1.   
FINANCIAL INFORMATION
     
         
Item 1.
Financial Statements
    3  
   
   Balance Sheets
    4  
      
   Statements of Operations
    5  
 
   Statements of Cash Flows
    6  
 
   Notes to Financial Statements
    7  
           
Item 2.   
Management’s Discussion and Analysis of Financial Condition and Results of Operations
    17  
      
         
Item 3.   
Quantitative and Qualitative Disclosures About Market Risk
    29  
      
         
Item 4.
Controls and Procedures
    29  
           
Part II.
OTHER INFORMATION
       
      
         
Item 1.   
Legal Proceedings
    31  
      
         
Item 1A.   
Risk Factors
    31  
           
Item 2.  
Unregistered Sales of Equity Securities and Use of Proceeds
    31  
           
Item 3.   
Defaults Upon Senior Securities
    32  
      
         
Item 4.      
Mine Safety Disclosures
    32  
           
Item 5.  
Other Information
    32  
      
         
Item 6.      
Exhibits
    33  

 
2

 

PART I

ITEM 1. FINANCIAL STATEMENTS
 
 
 

 

TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

FINANCIAL STATEMENTS

JUNE 30, 2012
(Unaudited)









 
3

 
 
TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

BALANCE SHEETS
(Unaudited)

   
June 30,
2012
   
December 31,
2011
 
             
ASSETS
 
             
CURRENT ASSETS
           
Cash
  $ 8,613     $ 4,119  
Prepaid expenses and other
    7,211       1,553  
                 
TOTAL CURRENT ASSETS
    15,824       5,672  
                 
Equipment
    3,143       -  
Intellectual property
    344,461       -  
                 
TOTAL ASSETS
  $ 363,428     $ 5,672  
                 
LIABILITIES AND STOCKHOLDERS’ DEFICIT
 
                 
CURRENT LIABILITIES
               
Accounts payable and accrued liabilities
  $ 279,430     $ 346,384  
Due to related parties (Note 11)
    351,243       257,637  
Loan payable (Note 12)
    200,000       175,000  
Loan payable - Due to related party (Note 11)
    126,500       15,000  
                 
TOTAL CURRENT LIABILITIES
    957,173       794,021  
                 
GOING CONCERN (Note 1)
               
                 
STOCKHOLDERS’ DEFICIT (Note 9)
               
Common stock, 333,333,330 shares authorized with $0.001 par value
               
Issued and outstanding
               
330,940,630 common shares (December 31, 2011 – 263,061,960)
    330,940       263,061  
Additional paid-in capital
    13,940,520       13,601,127  
Accumulated deficit during development stage
    (14,865,205 )     (14,652,537 )
                 
TOTAL STOCKHOLDERS’ DEFICIT
    (593,745 )     (788,349 )
                 
TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT
  $ 363,428     $ 5,672  
 
The accompanying notes are an integral part of these financial statements.

 
4

 

TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

STATEMENTS OF OPERATIONS
(Unaudited)

   
Three Months Ended
June 30
   
Six Months Ended
June 30
   
Inception (October 19, 2004) to
June 30,
 
   
2012
   
2011
   
2012
   
2011
   
2012
 
                               
GENERAL AND ADMINISTRATIVE EXPENSES
                         
Consulting fees
    22,200       10,750       22,700       12,000       903,237  
Impairment of oil and gas properties (Note 4)
    -       -       -       -       6,708,952  
Investor relations
    -       -       -       -       921,268  
Management fees (Note 11)
    27,520       26,520       54,040       53,040       3,781,078  
Office and general (recovery)
    29,836       25,767       51,453       49,758       936,733  
Professional fees
    9,075       7,026       25,173       20,123       1,091,746  
                                         
NET OPERATING LOSS:
    (88,631 )     (70,063 )     (153,366 )     (134,921 )     (14,343,014 )
                                         
OTHER EXPENSE
                                       
     Gain on expired oil and gas lease option
    -       -       -       -       100,000  
Abandonment expense
    (50,000 )     -       (50,000 )     -       (50,000 )
     Financing costs
    -       -       -       -       (424,660 )
     Interest expense
    (5,430 )     (2,159 )     (9,302 )     (4,619 )     (147,531 )
                                         
TOTAL OTHER EXPENSE
    (55,430 )     (2,159 )     (59,302 )     (4,619 )     (522,191 )
                                         
NET LOSS
  $ (144,061 )   $ (72,222 )   $ (212,668 )   $ (139,540 )   $ (14,865,205 )

BASIC LOSS PER COMMON SHARE
  $ (0.00 )   $ (0.00 )   $ (0.00 )   $ (0.00 )        
                                         
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING -BASIC
      267,269,420         263,061,960         265,165,690         263,061,960          

The accompanying notes are an integral part of these financial statements.

 
5

 

TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

STATEMENTS OF CASH FLOWS
(Unaudited)

   
Six Months Ended
June 30
   
Inception (October 19, 2004) to
 
   
2012
   
2011
   
June 30, 2012
 
                   
CASH FLOWS FROM OPERATING ACTIVITIES
                 
Net loss
  $ (212,668 )   $ (139,540 )   $ (14,865,205 )
Adjustments to reconcile net loss to net cash used in operating activities:                        
     - Stock based compensation
    -       -       2,430,595  
     - Impairment of oil and gas properties
    -       -       6,708,952  
     - Financing costs
    -       -       424,660  
CHANGES IN OPERATING ASSETS AND LIABILITIES
                       
     - Interest accrued
    9,302       (602 )     20,584  
     - Prepaid expenses and other
    579       12,107       (25,974 )
     - Due to related parties
    91,790               616,855  
  - Accounts payable and accrued liabilities
    30,196       48,240       283,815  
                         
NET CASH USED IN OPERATING ACTIVITIES
    (141,193 )     (79,795 )     (4,456,718 )
                         
CASH FLOWS FROM INVESTING ACTIVITIES
                       
Oil and gas property expenditures, net
    -       -       (3,610,003 )
Proceeds from sale of equity interest in oil and gas property, net
    -       -       253,552  
Acquisition of Glob Media, net of cash received
    187       -       187  
                         
NET CASH FLOWS USED IN INVESTING ACTIVITIES
    187       -       (3,356,264 )
                         
CASH FLOWS FROM FINANCING ACTIVITIES
                       
    Proceeds on sale and subscriptions of common stock
    -       -       5,021,595  
    Drilling advances
    -       -       759,000  
    Loan payable advances
    25,000       175,000       200,000  
    Payments to related parties
    -       (159,167 )     (1,815,000 )
    Advances from related parties
    120,500       65,000       3,656,000  
                         
NET CASH PROVIDED BY FINANCING ACTIVITIES
    145,500       80,333       7,821,595  
                         
INCREASE IN CASH
    4,494       1,038       8,613  
                         
CASH, BEGINNING OF PERIOD
    4,119       336       -  
                         
CASH, END OF PERIOD
  $ 8,613     $ 1,374     $ 8,613  
                         
SUPPLEMENTAL CASH FLOW INFORMATION AND
NON-CASH INVESTING AND FINANCING ACTIVITIES:
                       
     Cash paid for interest
  $ -     $ 5,220     $ 48,387  
     Common stock issued for acquisition of Glob Media
  $ 272,272     $ -     $ 272,272  
     Net liabilities assumed in acquisition of Glob Media
  $ 272,085     $ -     $ 272,085  
     Common stock issued for acquisition of oil and gas property
  $ -     $ -     $ 3,950,000  
     Transfer of bond against settlement of debt
  $ -     $ -     $ 25,000  
     Non-cash sale of oil and gas property
  $ -     $ -     $ 65,000  
     Common stock issued for settlement of debts (Note 9)
  $ 135,000     $ -     $ 3,196,997  

The accompanying notes are an integral part of these financial statements.
 
 
6

 
 
TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(unaudited)



NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION


Effective June 15, 2012, Morgan Creek Energy Corp. effected a name change on the OTC Bulletin Board to TagLikeMe Corp. (the “Company”). The Company is a development stage company that was organized to enter into the oil and gas industry.  The Company intended to locate, explore, acquire and develop oil and gas properties in the United States and within North America. In May 2012, the Company changed its business focus and plan to developing online and mobile content using search and sharing technology.

Effective June 29, 2012, the Company completed and consummated a share exchange agreement dated May 14, 2012, as fully executed on May 24, 2012 (the "Share Exchange Agreement") with Glob Media Works Inc., a company incorporated under the laws of the State of Washington ("Glob Media"), and each of the shareholders of Glob Media (collectively the "Glob Media Shareholders"), whereby the Corporation has acquired all of the issued and outstanding shares of Glob Media in exchange for the issuance of  45,378,670 shares of its restricted common stock to the Glob Media Shareholders on a pro rata basis in accordance with each Glob Media Shareholder's respective percentage equity ownership in Glob Media (Note 3). Glob Media owns intellectual property rights to its internet cloud based software application related to online search and social media developed by Glob Media. As a result of the closing of the Share Exchange Agreement, Glob Media has become the Company's direct wholly owned subsidiary.

Effective July 18, 2012, the Company completed a forward stock split by the issuance of 5 new shares for each 1 outstanding share of the Company’s common stock (Note 8). Unless otherwise noted, all references herein to number of shares, price per share or weighted average shares outstanding have been adjusted to reflect this stock split on a retroactive basis.

Going concern
The Company commenced operations on October 19, 2004 and has not realized any revenues since inception.  As of June 30, 2012, the Company has an accumulated deficit of $14,865,205.  The ability of the Company to continue as a going concern is dependent on raising capital to fund ongoing operations and carry out its business plan and ultimately to attain profitable operations.  Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence. To date the Company has funded its initial operations by way of private placements of common stock and advances from related parties.

Unaudited Interim Consolidated Financial Statements
The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for financial information and with the instructions to Form 10-Q of Regulation S-X.  They do not include all information and footnotes required by United States generally accepted accounting principles for complete financial statements.  However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the year ended December 31, 2011 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission.  The unaudited consolidated financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of management, all adjustments considered necessary for a fair presentation, consisting solely of normal recurring adjustments, have been made. Operating results for the six months ended June 30, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Organization
The Company was incorporated on October 19, 2004 in the State of Nevada.  The Company’s fiscal year end is December 31.
 
Basis of presentation
These financial statements are presented in United States dollars and have been prepared in accordance with United States generally accepted accounting principles.
 
 
7

 
 
TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(unaudited)

 
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)


The consolidated interim financial statements include the accounts of the Company and its wholly owned subsidiary, Glob Media Works Inc., from the date of acquisition on June 29, 2012.  All significant inter-company transactions and account balances have been eliminated upon consolidation.

Equipment
Equipment is recorded at cost and is depreciated over their estimated useful lives using the declining balance method at the following annual rates:

Computer equipment
30%

Intellectual property
Acquired intangible assets consist of identifiable intangible assets, including developed technology, non-compete agreements, workforce in place, in-process research and development (“IPR&D”) and a patent. Acquired intangible assets are recorded at fair value, net of accumulated amortization. Intangible assets are amortized on a straight-line basis over their estimated useful lives.

Impairment of long-lived assets
The Company evaluates its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

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 period.  Actual results could differ from those estimates. Significant areas requiring management’s estimates and assumptions are the determination of the fair value of transactions involving common stock and financial instruments. Other areas requiring estimates include deferred tax balances and asset impairment tests.

Cash and cash equivalents
For the statements of cash flows, all highly liquid investments with maturity of three months or less are considered to be cash equivalents.  There were no cash equivalents as of June 30, 2012 and December 31, 2011 that exceeded federally insured limits.

Financial instruments
The fair value of the Company’s financial assets and financial liabilities approximate their carrying values due to the immediate or short-term maturity of these financial instruments.

Earnings (loss) per common share
Basic earnings (loss) per share includes no dilution and is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding for the period.  Dilutive earnings (loss) per share reflects the potential dilution of securities that could share in the earnings of the Company.  Dilutive earnings (loss) per share is equal to that of basic earnings (loss) per share as the effects of stock options and warrants have been excluded as they are anti-dilutive.
 
 
8

 
 
TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(unaudited)

 
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)


Income taxes
The Company follows the liability method of accounting for income taxes.  Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances.  Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment.  As at June 30, 2012, the Company had net operating loss carryforwards, however, due to the uncertainty of realization, the Company has provided a full valuation allowance for the deferred tax assets resulting from these loss carryforwards.

Stock-based compensation
On June 1, 2006, the Company adopted FASB ASC 718-10, “Compensation-Stock Compensation”, under this method, compensation cost recognized for the year ended May 31, 2007 includes: a) compensation cost for all share-based payments granted prior to, but not yet vested as of May 31, 2006, based on the grant-date fair value estimated in accordance with the original provisions of SFAS 123, and b) compensation cost for all share-based payments granted subsequent to May 31, 2006, based on the grant-date fair value estimated in accordance with the provisions of FASB ASC 718-10.  In addition, deferred stock compensation related to non-vested options is required to be eliminated against additional paid-in capital upon adoption of FASB ASC 718-10. The results for the prior periods were not restated.

The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with FASB ASC 718-10 and the conclusions reached by the FASB ASC 505-50.  Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable.  The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by FASB ASC 505-50.

NOTE 3 – ASSET ACQUISITION


In accordance with ASC 805, “Business Combinations”, and in particular ASC 805-50-25, the acquisition of Glob Media ("Glob") is accounted for as an asset purchase without goodwill as Glob did not meet the definition of a business per ASC 805 at the time of the acquisition.  Assets and liabilities assumed are recorded at their estimated fair values with no goodwill recorded.
 
Effective June 29, 2012, the Company completed and consummated a share exchange agreement dated May 14, 2012, as fully executed on May 24, 2012 (the "Share Exchange Agreement") with Glob Media, a company incorporated under the laws of the State of Washington, and each of the shareholders of Glob Media (collectively the "Glob Media Shareholders"), whereby the Company has acquired all of the issued and outstanding shares of Glob Media in exchange for the issuance of  45,378,670 shares of its restricted common stock to the Glob Media Shareholders valued at $272,272 (Note 9) on a pro rata basis in accordance with each Glob Media Shareholder's respective percentage equity ownership in Glob Media (Note 1). Glob Media owns intellectual property rights to its internet cloud based software application related to online search and social media developed by Glob Media.
 
 
9

 

TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(unaudited)

 
NOTE 3 – ASSET ACQUISITION (continued)

 
The purchase price allocation has been determined as follows:

Assets acquired:
     
Cash and cash equivalents
  $ 187  
Prepaid expenses and other
    6,237  
Equipment
    3,143  
Intellectual property
    344,461  
         
Total assets acquired
  $ 354,028  
         
Liabilities assumed:
       
Accounts payable
  $ 69,756  
Loan payable – Due to related party
    12,000  
         
Total liabilities assumed
  $ 81,756  
         
Net assets acquired
  $ 272,272  
         
Purchase price
  $ 272,272  

Intellectual property of $344,461 was valued based on the allocation of the deemed purchase price of the shares of Glob Media over the assets and liabilities acquired ( Note 6).

NOTE 4 – OIL AND GAS PROPERTIES

 
All of the following oil and gas properties discussed below have been fully impaired.

(a) Quachita Prospect
The Company has leased various properties totalling approximately 1,971 net acres within the Quachita Trend within the state of Texas for a three year term, all expiring during the year ended 2009, in consideration for $338,353.  The Company has a 100% Working Interest and a 77% N.R.I. in the leases.  During 2009 the balances of the leases within the Quachita trend were allowed to lapse without renewal by the Company.  Accordingly, during 2009 the Company wrote off the original cost of these leases totaling $338,353. As allowed for under the lease which included the Boggs #1 well, the Company has paid a nominal fee to maintain its rights and access to the Boggs #1 well.

Boggs #1

On June 7, 2007, the Company began drilling its first well on the Quachita Prospect (Boggs #1).  During 2007 the Company began production testing and evaluation of the well.  Of the five tested zones, four produced significant volumes of natural gas. As formation water was also produced with the natural gas in the tested zones, the Boggs #1 is currently under evaluation.  To date, $1,336,679 had been incurred on drilling and completion expenditures on the Boggs #1.  The Boggs #1 was initially privately funded with the funding investors receiving a 75% Working Interest and a 54% Net Revenue Interest in exchange for providing 100% of all drilling and completion costs. To December 31, 2007, the Company had incurred $1,335,780 of costs on Boggs #1 and had received $759,000 in funding from the private investors. On March 24, 2008, the Company negotiated with the funding investors to acquire their interest in the well for an amount equal to the total amount of their initial investment being $759,000 and forgiveness of any additional amounts owing. Effective March 24, 2008, the Company completed this acquisition and settlement through the issuance of 12,650,000 shares of common stock at $0.063 per share.

 
10

 

TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(unaudited)

 
NOTE 4 – OIL AND GAS PROPERTIES (continued)


As formation water was also produced with the natural gas in the tested zones, the Boggs #1 was fully impaired as of December 31, 2011.  While there is potential to exploit lower zones or to recomplete the well under an improved gas pricing environment, an impairment charge of $891,119 was recorded against the well in 2010 and a further impairment charge of $445,560 was recorded against the well in fiscal 2011.  In the three months ended June 30, 2012, the Company booked an abandonment provision of $50,000 to cover the costs of plugging and abandoning the well.

(b) New Mexico Prospect
The Company to date had leased various properties totalling approximately 7,576 net acres within the state of New Mexico for a five year term in consideration for $112,883.  The Company has a 100% Working Interest and an 84.5% N.R.I. in the leases.  On October 31, 2008, the Company entered into an agreement to acquire from Westrock Land Corp. approximately 5,763 additional net acres of property within the State of New Mexico for a five year term in consideration for $388,150.  The Company acquired a 100% working interest in approximately 5,763 net acres; and an 81.5% N.R.I. in the leases in approximately 5,763 net acres.

On July 9, 2009, the Company entered into a Letter Agreement with FormCap Corp. (“FormCap”), for joint drilling on the Company’s New Mexico prospect whereby FormCap was required to drill and complete two mutually defined targets on the Company’s leases in return for an earned 50% Working Interest in the entire New Mexico Prospect.  During the period FormCap advanced a non-refundable $100,000 deposit under the terms of the Option to secure the project in connection with which the Company paid a finders’ fee of $20,000.  On September 24, 2009, the Company announced that FormCap could not meet the requirements of the Option Agreement and thus forfeited its rights to the project. The Company retained the $100,000 non-refundable deposit and recorded it as a gain on expired oil and gas lease option during 2009. Due to current market conditions, the Company decided to fully impair these properties in fiscal 2011.  An impairment charge of $541,646 was recorded against these properties in fiscal 2011.

(c) Oklahoma Prospect
On May 28, 2009, the Company entered into a Letter Agreement with Bonanza Resources Corporation (“Bonanza”) for an option to earn a 60% interest of Bonanza’s 85% interest in the North Fork 3-D prospect in Beaver County, Oklahoma in approximately 5,600 net acres. The parties intended to enter into a definitive agreement regarding the option and purchase of the 60% interest within 60 days. A non-refundable payment of $150,000 was paid to Bonanza, whereby Bonanza would grant the Company an exercise period of one year. As per a verbal agreement, the 60 day period was extended to August 17, 2009 and subsequently extended to October 28, 2009. On November 30, 2009 an amendment to the original agreement was made whereby the Company increased its option to acquire from 60% to 70% interest of Bonanza’s 85% interest. The Company paid $50,000 during August 2009 and on October 23, 2009 paid an additional $65,000.  The balance of $35,000 was due by December 31, 2009. Subsequently on January 12, 2010 the cumulative non-refundable payment was amended from $150,000 to $125,000. On January 15, 2010 the Company made the final payment of $10,000.

In order to exercise the option, the Company will be required to incur $2,400,000 in exploration and drilling expenditures during the Option Period which will be one year. In the event that the Company does not do so the option will terminate, the Company will cease to have any interest in the prospect and Bonanza will retain the benefit of any drilling or exploration expenditures made by the Company during the Option Period. On November 30, 2009 the Agreement between Bonanza and the Company was amended whereby the Company agreed to incur the full cost of drilling one well to completion on the prospect and will have exercised its option to earn its interest in the well and the balance of the Prospect.  In the event that the first well is a dry hole, the Company will have the exclusive right and option to participate in any and all further drilling programs on the Prospect and to incur the full cost of drilling a second well to acquire a 75% interest of Bonanza’s 85% interest (59.50% working interest) in both that well and the balance of the Prospect.

 
11

 
 
TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(unaudited)

 
NOTE 4 – OIL AND GAS PROPERTIES (continued)


On January 15, 2010, the Company entered into a Participation Agreement to finance drilling and completion costs with two partners who will pay 67% of the costs of the first well in the Prospect.  The Company will pay 33% of the drilling and completion costs.  To December 31, 2009, the Company had accrued the entire estimated cost of the first well of $475,065 of which $316,690 was paid to the Company during the period by the new participants.  Also during the period, the Company received a reduction in the well cost from the operator totalling $189,413 which resulted in amounts payable by the new participants being reduced to $190,530.  Of the excess paid during the period by the new participants, $63,022 remains payable as of June 30, 2011 and has been included in accounts payable and accrued liabilities.

On February 1, 2010, the Company was informed by its operator that it had drilled the Nowlin #1-19 well to a depth of 8,836 feet.  After review of the drilling logs, the Company has determined that oil is not producible in the targeted Morrow A and B sand formations.  The well has been plugged and the Company wrote off the net cost of the well of $230,524 during 2010.

(d) Mississippi Prospect
Effective on August 26, 2010, the Board of Directors of the Company authorized the execution of an option agreement dated August 26, 2010 (the “Option Agreement”) with Westrock Land Corp. (“Westrock”), to purchase approximately 21,000 net acres of mineral oil and gas leases on lands located in Lamar, Jones and Forrest counties in the State of Mississippi (the “Acquired Properties”).  The Company entered into the Option Agreement with Westrock, as the mineral leaseholder, and received representations that Westrock owned all right, title and interest to all depths, including the Haynesville Shale Formation pursuant to the oil and gas leases with a minimum 75% net revenue interest.

In accordance with the terms and provisions of the Option Agreement: (i) the Company agreed to issue to Westrock an aggregate of 75,000,000 restricted shares of its common stock by November 30, 2010; (ii) Westrock granted to the Company a period to conduct due diligence to October 31, 2010; and (iii) at closing, Westrock conveyed to the Company the Acquired Properties by assignment and bill of sale and other associated documentation. The Company and Westrock anticipated that the closing would occur no later than November 1, 2010.

The Company completed due diligence on the Acquired Properties and issued 75,000,000 restricted common shares, with an estimated fair value of $3,000,000, to Westrock on October 21, 2010.

Due to current market conditions, the Company decided to fully impair these properties in fiscal 2011.  An impairment charge of $3,000,000 was recorded against these properties in fiscal 2011.

NOTE 5 – EQUIPMENT


               
Net Book Value
 
   
Cost
   
Accumulated
amortization
   
June 30,
2012
   
December 31, 2011
 
                         
Computer equipment
  $ 3,143     $ -     $ 3,143     $ -  
                                 
    $ 3,143     $ -     $ 3,143     $ -  

 
12

 
 
TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(unaudited)

 
NOTE 6 – INTELLECTUAL PROPERTY

 
After consummation of the Share Exchange Agreement, we are in the business of connecting online users with others while looking for online information and making it easier for them to collect and share that information. In turn, we create population centers of topic specific audiences that we plan to make available to third party ad publishers and information content providers. We are not a search engine nor do we intend to become one. It’s a hybrid site we call a “Common Information Network” where we leverage the existing search capabilities of major search engines, cross references the search information with real population remarks from major social and wiki networks, while giving our users the capability to collect, publish, share or collaborate their search information with whomever they choose in a public or private manner. As more and more users collect and tag search results, management believes that we will ultimately become a destination where people can look for already filtered and shared web information as well as connect, message and interact with other people searching for the same information as them.
 
Our planned business model will encompass three fundamental stages of growth:

A.  
Population. As the beta product matures from user feedback and ongoing general development, the business will require additional funding to pursue additional marketing and support personnel. Significant cross marketing, ad placement and general awareness campaigns will have to be implemented on a constant basis in order to maintain general awareness and overall activities growth;

B.  
Thoroughly position the development of the product toward mobile and portable device style applications. This will require additional resources in development and the overall first phase plan is to deploy a mobile platform for iOS phones and pads for users to take advantage of Tags search, bookmarking, and collaboration tools for the “on-the-go” user; and

In addition to desktop user activities which management feels will increasingly decline over the next two to three years, we intend to focus on monitoring and building on its expected mobile and tablet user population and from their activities, generate a specific advertising.

Intellectual property of $344,461 was valued based on the allocation of the deemed purchase price of the shares of Glob Media over the assets and liabilities acquired ( Note 3) and will be used in the development of source code to advance the services describd above.

NOTE 7 – ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

On June 15, 2012, the Company agreed to settle accounts payable debts by issuing 19,000,000 common shares fair valued at $114,000 or $0.006 per share (Note 9).

 
13

 
 
TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(unaudited)

 
NOTE 8 – STOCK SPLIT ADJUSTMENT


On July 23, 2012, the Company executed a 5 to 1 forward stock split, which was retrospectively applied to all financial statements, including the comparative balance sheet as of December 31, 2011. This adjustment did not change total stockholders’ deficit. The original filing was for $52,612 in common stock and $13,811,576 in additional paid in capital. The post-split adjusted balances in this filing are now $263,061 in common stock and $13,601,127 in additional paid in capital, resulting in an effective increase in common stock and increase in additional paid in capital of $264,752, net effect on stockholders’ deficit of $0 as of December 31, 2011.
 
NOTE 9 – STOCKHOLDERS’ EQUITY (DEFICIT)


(a)  Share Capital
The Company’s capitalization is 333,333,330 common shares with a par value of $0.001 per share.
 
On April 22, 2008, the directors of the Company approved a special resolution to undertake a reverse split of the common stock of the Company on a basis of 1 new share for 3 old shares.  On July 26, 2006, the directors of the Company approved a special resolution to undertake a forward split of the common stock of the Company on a basis of 2 new shares for 1 old share.  On May 10, 2006, the directors of the Company approved a special resolution to undertake a forward split of the common stock of the Company on a basis of 2 new shares for 1 old share.  On July 14, 2009, the directors of the Company approved a special resolution to undertake a forward split of the common stock of the Company on a basis of 2 new shares for 1 old share.

On July 23, 2012, the Company increased the authorized share capital from 66,666,666 shares of common stock to 333,333,330 shares of common stock with the same par value of $0.001 per share. On July 16, 2012, the Company filed a Certificate of Change with the Nevada Secretary of State in relation to the 5 for one forward split of the Company’s common shares on July 23, 2012 to effect the 5 for one forward split of the Company’s authorized common shares (Note 8).

All references in these financial statements to number of common shares, price per share and weighted average number of common shares outstanding prior to the 2:1 forward stock split on May 10, 2006, the 2:1 forward split on August 8, 2006, the 3:1 reverse stock split on April 22, 2008 the 2:1 forward split on August 3, 2009, and the 5:1 forward split on July 23, 2012  have been adjusted to reflect these stock splits on a retroactive basis, unless otherwise noted.

(b)   Other issuances
On June 15, 2012, the Company agreed to settle $135,000 of notes and accounts payable debts by issuing 22,500,000 common shares fair valued at $135,000 or $0.006 per share (Notes 7 and 11).

On June 29, 2012, the Company issued 45,378,670 shares of restricted common stock with a value of $272,272 related to the acquisition of Glob Media (Note 3).
 
 
14

 
 
TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(unaudited)

 
NOTE 9 – STOCKHOLDERS’ EQUITY (DEFICIT) (continued)


(c)   Share Purchase Warrants
There are no share purchase warrants issued and outstanding as of June 30, 2012.

The Company’s share purchase warrants activity for the period ended June 30, 2012 is summarized as follows:

   
Number of Warrants
   
Weighted average exercise
Price per share
   
Weighted average remaining
In contractual life (in years)
 
                   
Balance, December 31, 2010
    8,950,000     $ 0.198       0.44  
Issued
    -       -       -  
Expired
    (8,950,000 )     0.198       -  
Exercised
    -       -       -  
                         
Balance, December 31, 2011
    -       -       -  
Issued
    -       -       -  
Expired
    -       -       -  
Exercised
    -       -       -  
                         
Balance, June 30, 2012
    -     $ -       -  

NOTE 10 – STOCK OPTION PLAN


Effective June 15, 2012, the Board of directors ratified the cancellation of 15,000,000 stock options previously granted under the Company’s Stock Option Plan.

The Company’s stock option activity for the period ended June 30, 2012 is summarized as follows:

   
Number of Options
   
Weighted average exercise
Price per share
   
Weighted average remaining
In contractual life (in years)
 
                   
Balance, December 31, 2010
    17,833,330     $ 0.066       8.21  
Granted
    -       -       -  
Expired - cancelled
    (833,330     0.066       -  
Exercised
    -       -       -  
                         
Balance, December 31, 2011
    17,000,000       0.066       7.21  
Granted
    -       -       -  
Expired - cancelled
    (15,000,000 )     0.066       -  
Exercised
    -       -       -  
                         
Balance, June 30, 2012
    2,000,000     $ 0.066       6.71  

All options are exercisable as at June 30, 2012.

 
15

 
 
TAGLIKEME CORP.
(formerly Morgan Creek Energy Corp.)
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
(unaudited)

 
NOTE 11 – RELATED PARTY TRANSACTIONS


During 2010, a shareholder made advances of $94,167 which was due and owing as of December 31, 2010, which bears interest at 8% per annum and has no specific repayment terms.  During 2011, this shareholder made further advances of $80,000 and was repaid $159,167 and $5,220 in principal and interest respectively.  During the six month period ended June 30, 2012, this shareholder made further advances of $25,500 and the Company issued 3,500,000 common shares valued at $21,000 to settle advances from this shareholder (Note 9). Total accrued interest was $1,469 leaving a total of $20,969 owing to this shareholder (December 31, 2011 - $15,302). This is recorded as loan payable due to related party as of June 30, 2012.

During the six month period ended June 30, 2012, another shareholder made advances of $95,000.  The advances bear interest at 8% per annum and have no specific repayment terms.  Total accrued interest was $649 leaving a total of $95,649 owing to this shareholder at June 30, 2012. This is recorded as loan payable due to related party as of June 30, 2012.
 
Glob Media received shareholder advances of $12,000 during fiscal 2012 which bear no interest and have no specific repayment terms. This is recorded as loan payable due to related party as of June 30, 2012.

During the period ended December 31, 2011, the Company received an advance of $5,000 from Sono Resources., a company with certain directors in common with the Company. These advances are non-interest bearing, unsecured and without specific terms or repayment. This has been recorded as due to related parties as of June 30, 2012.

The Company owes $57,830 to a former officer and director of the Company to provide office space and office services for the period ended June 30, 2012 (December 31, 2011 – $44,593).

Management Fees
During the six month period ended June 30, 2012, the Company incurred $54,040 (June 30, 2011 -$53,040) for management fees to officers and directors.  As of June 30, 2012, total amount owing to related parties in accrued and unpaid management fees and expenses was $266,077 (December 31, 2011- $206,742).

NOTE 12 - LOAN PAYABLE


During 2011, the Company received loan proceeds of $175,000 from an unrelated third party pursuant to an unsecured promissory note agreement effective May 15, 2011 and maturing November 15, 2011.  The promissory note bears interest at a rate of 10% per annum of which a total of $17,941 has been accrued for interest as of June 30, 2012. This note is now due on demand.

During the quarter ended June 30, 2012, the Company received loan proceeds of $25,000 from an unrelated third party pursuant to an unsecured promissory note.  The promissory note is due on demand and bears interest at a rate of 10% per annum of which a total of $525 has been accrued for interest as of June 30, 2012.
 
 
16

 
 
FORWARD LOOKING STATEMENTS

Statements made in this Form 10-Q that are not historical or current facts are "forward-looking statements" made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange Act of 1934. These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

Share Exchange Agreement

We were incorporated under the laws of the State of Nevada on October 19, 2004 under the name "Morgan Creek Energy Corp." and since our inception engaged in the business of exploration of oil and gas bearing properties in the United States. Our Board of Directors approved the execution of a share exchange agreement dated effective as of May 14, 2012 as fully executed on May 21, 2012 (the "Share Exchange Agreement"), among us, Glob Media Works Inc., a private company organized under the laws of the State of Washington ("Glob Media") and the shareholders of Glob Media (the "Glob Media Shareholders").  In accordance with the terms and provisions of the Share Exchange Agreement, we acquired approximately 5,317,033 shares of common stock from the Glob Media Shareholders, which represented all of the issued and outstanding shares of Glob Media, in exchange for the issuance by us to the Glob Media Shareholders on a pro rata basis of approximately 45,378,670 shares of our restricted common stock at the rate of $0.03 per share. This resulted in Glob Media becoming our wholly-owned subsidiary. Glob Media is the legal, beneficial and registered owner of certain intellectual property rights for certain software and internet applications (the "Intellectual Property").
 
Effective June 15, 2012, we and Glob Media and the Glob Media Shareholders, through their attorney-in-fact, approved the execution of an addendum to the Share Exchange Agreement (the "Addendum").  In accordance with the terms and provisions of the Addendum, Section 6.2 of the Share Exchange Agreement was revised to provide for the latest closing date to be changed from June 15, 2012 to June 30, 2012.
 
Effective June 29, 2012, we completed and consummated the Share Exchange Agreement with Glob Media and each of the Glob Media Shareholders, whereby we acquired all of the issued and outstanding shares of Glob Media in exchange for the issuance of 45,378,670 shares of our restricted common stock to the Glob Media Shareholders on a pro rata basis in accordance with each Glob Media Shareholder's respective percentage equity ownership in Glob Media.
 
 
17

 

Articles of Merger

On May 29, 2012, we filed with the Nevada Secretary of State Articles of Merger pursuant to which we merged into our wholly-owned subsidiary, TagLikeMe Corp., and the surviving corporation. Thus, our name was changed to "TagLikeMe Corp,." pursuant to the Articles of Merger (the "Name Change"). The Name Change was approved by our Board of Directors pursuant to written consent resolutions dated May 30, 2012. We filed the appropriate documentation with FINRA in order to effectuate the Name Change in the OTC Markets. The Name Change was effected on the OTC Markets June 15, 2012. Our new CUSIP number is 87378P 105.
.
Therefore, as of the date of this Quarterly Report, our trading symbol is “TAGG”. Our management deemed it appropriate to change our name to TagLikeMe Corp. in furtherance of and to better reflect the nature of our new business operations.

Stock Split
 
On July 3, 2012, our Board of Directors authorized and approved a stock split of five for one (5:1) of our total issued and outstanding shares of common stock (the “Stock Split”). The Stock Split was effectuated as part of the re-organization mandate and the Share Exchange Agreement. The Board of Directors considered further factors regarding approval of the Stock Split including, but not limited to: (i) further increase our authorized share capital to a sufficient number similar to other industry public offerings, such as our direct competitors; (ii) the closing of the Share Exchange Agreement; (iii) current trading price of our shares of common stock on the OTC Bulletin Board Market and potential to increase the marketability and liquidity of our common stock; (iv) possible reluctance of brokerage firms and institutional investors to recommend lower-priced stocks to their clients or to hold in their own portfolios; (v) desire to meet future requirements of a larger share cap as required for market demand and interest by larger shareholder networks to decrease share price volatility; and (vi) desire to meet future requirements regarding per-share price and net tangible assets and shareholders’ equity relating to admission for trading on other markets; therefore.
 
The Stock Split was effectuated on July 23, 2012 upon filing the appropriate documentation with FINRA. The Stock Split increased our total issued and outstanding shares of common stock from 61,688,126 shares of common stock to 308,440,630 shares of common stock. The common stock will continue to be $0.001 par value. The shareholder record date was July 23, 2012.
 
As of the date of this Quarterly Report, there are 330,940,630 shares issued and outstanding.
 
Certificate of Change
 
On July 16, 2012, we filed with the Nevada Secretary of State a certificate of change to the Articles of Incorporation to increase our authorized capital structure commensurate with the increase of our shares pursuant to the Stock Split. Therefore, as of the date of this Quarterly Report, our authorized capital structure has been increased from 66,666,666 shares of common stock to 333,333,330 shares of common stock, par value of $0.001.
 
 
18

 

Please note that throughout this Quarterly Report, and unless otherwise noted, the words "we," "our," "us," the "Company," or "Taglikeme," refers to Taglikeme Corp.

CURRENT BUSINESS OPERATIONS

TagLikeMe
 
After consummation of the Share Exchange Agreement, we are in the business of connecting online users with others while looking for online information and making it easier for them to collect and share that information. In turn, we create population centers of topic specific audiences that we plan to make available to third party ad publishers and information content providers. We are not a search engine nor do we intend to become one. It’s a hybrid site we call a “Common Information Network” where we leverage the existing search capabilities of major search engines, cross references the search information with real population remarks from major social and wiki networks, while giving our users the capability to collect, publish, share or collaborate their search information with whomever they choose in a public or private manner. As more and more users collect and tag search results, management believes that we will ultimately become a destination where people can look for already filtered and shared web information as well as connect, message and interact with other people searching for the same information as them.
 
Our planned business model will encompass three fundamental stages of growth:

A.  
Population. As the beta product matures from user feedback and ongoing general development, the business will require additional funding to pursue additional marketing and support personnel. Significant cross marketing, ad placement and general awareness campaigns will have to be implemented on a constant basis in order to maintain general awareness and overall activities growth;

B.  
Thoroughly position the development of the product toward mobile and portable device style applications. This will require additional resources in development and the overall first phase plan is to deploy a mobile platform for iOS phones and pads for users to take advantage of the Company’s search, bookmarking, and collaboration tools for the “on-the-go” user; and

In addition to desktop user activities which management feels will increasingly decline over the next two to three years, we intend to focus on monitoring and building on its expected mobile and tablet user population and from their activities, generate a specific advertising

Oil and Gas Properties

After consummation of the Share Exchange Agreement, we remain holding title to certain oil and gas properties as previously disclosed; however, all oil and gas properties discussed have been fully impaired.
 
 
19

 

The acreage and location of our oil and gas properties is summarized as follows:

   
Net Acres(*)
 
New Mexico
    13,339  
Mississippi     21,000  
Total:
    34,339  
__________
(*)
Certain of our interests in our oil and gas properties may be less than 100%.  Accordingly, we have presented the acreage of our oil and gas properties on a net acre basis.
 
Quachita Prospect

As of the date of this Quarterly Report, we lease approximately 1,971 net acres within the Quachita Trend in the State of Texas for a three-year term in consideration of approximately $338,000. We have a 100% working interest and a 77% net revenue interest in the Quachita Prospect leases. During 2009, the balances of the leases within the Quachita trend were allowed to lapse without renewal by us. Accordingly, during the year ended December 31, 2009, we wrote off the original cost of these leases totaling $338,353. As allowed for under the lease which included the Boggs #1 well, we have paid a nominal fee to maintain our rights and access to the Boggs #1 well.

Boggs #1 Well.  We completed the drilling portion of the Boggs #1 well on July 13, 2007. Subsequently, we began production testing and evaluation of the well. Of the five tested zones, four produced significant volumes of natural gas. As formation water was also produced with the natural gas in the tested zones, the Boggs #1 is currently under evaluation.

The Boggs #1 had been privately funded with the funding investors receiving a 75% working interest and a 54% net revenue interest in exchange for providing 100% of all drilling and completion costs. Therefore, we initially retained a 25% working interest and a 23% net revenue interest in the Boggs #1 well. As of June 30, 2009, we incurred $1,336,679 in drilling and completion costs. As of June 30, 2009, we had received a total of $759,000 in funding from private investors. On March 24, 2008, we negotiated with the funding investors to acquire their interest in the Boggs #1 for $759,000 (which amount is equal to the total amount of the funding investors’ initial investment) and forgiveness of any additional amounts owing. Effective on March 24, 2008, we completed the acquisition and settlement of related party advances totaling $962,980 through the issuance of 3,057,076 shares of our restricted common stock at $0.315 per share. The difference between the estimated fair value of the common shares at issuance and the amount of the debt settled totaling $45,857 was recorded as a finance cost.

As formation water was also produced with the natural gas in the tested zones, the Boggs #1 was partially impaired as of December 31, 2010.  While there is potential to exploit lower zones or to recomplete the well under an improved gas pricing environment, an impairment charge of $891,119 was recorded against the well in 2010 and a further impairment charge of $445,560 was recorded against the well in fiscal 2011. We follow the full cost method of accounting for our oil and gas properties whereby all costs related to the acquisition of methane, petroleum and natural gas interests are capitalized. Such costs include land and lease acquisition costs, annual carrying charges of non-producing properties, geological and geophysical costs, costs of drilling and equipping productive and non-productive wells, and direct exploration salaries and related benefits. Certain of these costs are reviewed by management periodically for impairment regarding our unproved oil and gas properties. Management’s assessment of these costs and results of exploration activities, potential commodity price outlooks or expiration of all or a portion of leaseholds resulted in its decision to impair the Boggs #1 and may further impact the timing and amount of other impairments on our properties.
 
 
20

 

As of the date of this Quarterly Report, we intend to plug and abandon the Boggs #1 well and have accrued $50,000 for related costs. No further work is planned on being conducted and the leases will eventually expire.

New Mexico Prospect

As of the date of this Quarterly Report, we have leased various properties in the New Mexico Prospect totaling approximately 7,576 net acres within the State of New Mexico for a five year term expiring in 2013. in consideration for $112,883. We have a 100% working interest and an 84.5% net revenue interest in the leases comprising the New Mexico Prospect.

Westrock Land Corp. Option Agreement. Effective on October 31, 2008, our Board of Directors authorized the execution of an option agreement (the “Option Agreement”) with Westrock Land Corp, a private Texas corporation (“Westrock”). In accordance with the terms and provisions of the Option Agreement: (i) Westrock owns all right, title and interest in and to approximately 7,763 net acres of  property within the State of New Mexico with a net revenue interest of 81.5% pertaining to 5,763 of the net acres (the “New Mexico Leases”); (b) Westrock ; (iii) we desire to acquire a 100% working interest in the New Mexico Leases for a total purchase price of approximately $388,150; and (iv) we had until April 16, 2009 to complete our due diligence (the “Option Period”).
 
The Option Agreement was subsequently extended on March 31, 2009 and June 1, 2009 whereby the option period was extended to September 15, 2009. We exercised our option with Westrock and acquired the approximate 5,763 net acres in New Mexico.
 
Formcap Corporation Option Agreement. Effective on July 14, 2009, our Board of Directors, pursuant to unanimous vote at a special meeting of the Board, authorized the execution of a letter agreement dated July 9, 2009 (the “Option Agreement”) with Formcap Corporation (“Formcap”), to purchase a 50% working interest (40.75% net revenue interest) of our 81.5% leasehold interest in and to certain leases located in Curry County, State of New Mexico (the “Frio Draw Prospect Interest”).
 
In accordance with the terms and provisions of the Option Agreement: (i) Formcap agreed to pay us a $100,000 initial payment (the “Initial Payment”) within five business days from the completion of its due diligence; (ii)  the balance of funds for the initial well would be advanced by FormCap to us within five business days from receipt of a mutually agreed upon approval for expenditure, which balance of such funds for the initial well were to be received by us no later than September 8, 2009; and (iii) the Initial Payment would be applied towards the total consideration to be paid by FormCap to us, which would include the cost of drilling and completing two wells at a total estimated cost of approximately $1,300,000.
 
In accordance with the further terms and provisions of the Option Agreement: (i) FormCap would provide to us the dry hole and completion costs estimated at $650,000 in advance of drilling the first well; (ii) upon drilling and completion of the first well, we would assign to FormCap a 25% working interest (20.375% net revenue interest) in the Frio Draw Prospect Interest; and (iii) upon receipt by us of the funds from Formcap in advance of drilling the second well, we would assign to FormCap the additional 25% working interest (20.375% net revenue interest). Costs associated with the drilling of all subsequent wells were to be shared on an equal basis between us and FormCap.
 
 
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We granted to FormCap the time period between the date of execution of the Option Agreement and August 15, 2009 to complete its due diligence (the “Option Period”). During the period FormCap advanced a non-refundable $100,000 deposit under the terms of the Option to secure the project in connection with which we paid a finders’ fee of $20,000.  On September 24, 2009, we announced that FormCap could not meet the requirements of the Option Agreement and thus forfeited its rights to the project. We retained the $100,000 non-refundable deposit and recorded it as a gain on expired option. Due to current market conditions, management decided to fully impair the Frio Draw Prospect during fiscal year ended December 31, 2011 and, thus, an impairment charge of $541,646 was recorded.
 
Oklahoma Prospect
 
Effective on June 2, 2009, our Board of Directors, pursuant to unanimous vote at a special meeting of the Board, authorized the execution of a letter agreement dated May 28, 2009, as amended (the “Option Agreement”) with Bonanza Resources (Texas) Inc., the wholly owned subsidiary of Bonanza Resources Corporation (“Bonanza Resources”), to purchase a certain percentage of Bonanza Resources’ eighty-five percent (85%) leasehold interest (the “Bonanza Resources Interest”) in and to certain leases located in Beaver County, State of Oklahoma, known as the North Fork 3-D Prospect (the “Prospect”). In accordance with the terms and provisions of the Option Agreement: (i) we agreed to make a non-refundable payment to Bonanza Resources of $150,000 within sixty (60) days from the date of the Option Agreement; and (ii) Bonanza Resources agreed to grant to us an option having an exercise period of one year (the “Option Period”) to purchase a sixty percent (60%) partial interest (the “Partial Interest”) in the Bonanza Resources Prospect. In further accordance with the terms and provisions of the Option Agreement, in the event we do not pay the $150,000 to Bonanza Resources within sixty days from the date of the Option Agreement, the Option Agreement will terminate.
 
The Bonanza Resources Interest is held by Bonanza Resources pursuant to that certain letter agreement between Bonanza Resources, Ryan Petroleum LLC and Radian Energy L.C. dated February 25, 2009 (the “Original Agreement”). In accordance with the terms and provisions of the Original Agreement, Bonanza Resources acquired the Bonanza Resources Interest and subsequently represented to us that the acreage of the Bonanza Resources Interest consisted of 8,555 acres. Therefore, the Option Agreement reflected the acreage of the Bonanza Resources Interest to consist of 8,555 acres, which has been subsequently disclosed by us in numerous filings  with the Securities and Exchange Commission.
 
Furthermore, in the event we pay the $150,000 to Bonanza Resources within the sixty day period from the date of the Option Agreement, and in accordance with the further terms and provisions of the Option Agreement: (i) we shall assume that amount of Bonanza Resources’ right, title and interest and obligations under the Original Agreement as is proportionate to the Partial Interest; and (ii) we must incur $2,400,000 in exploration and drilling expenditures (the “Exploration Expenditures”) during the Option Period. In the event that we do not exercise the Option Agreement, Bonanza Resources shall retain the $150,000 as liquidated damages for our failure to incur the Exploration Expenditures.
 
 
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During the course of our due diligence, we discovered that the size of the Bonanza Resources Interest is not the original represented 8,555 acres but approximately 5,600 acres, which we alleged was materially less than represented by Bonanza Resources and contracted for under the Option Agreement. Bonanza Resources has stated to us that the actual lesser amount of acreage forming the Bonanza Resources Interest was due to certain leases not being renewed by the operator of the Prospect, thus expiring prior to the date of the Option Agreement, without first advising Bonanza Resources either orally or in writing of the operator’s intention to allow those leases to expire. Bonanza Resources further stated to us that it discovered the facts regarding the acreage on approximately November 26, 2009. We in good faith relied on the representations of Bonanza Resources when we entered into the Option Agreement and now know that such representations were not correct.
 
Therefore, as of November 30, 2009, we entered into an amendment of the Option Agreement with Bonanza Resources (the “Amendment”). In accordance with the terms and provisions of the Amendment, Bonanza Resources granted to us an option to acquire a 75% interest in the Bonanza Resources Interest (a 59.50% working interest) by incurring the full costs of drilling one well to completion on the Prospect, which will deem us as having earned an interest in that well and in the balance of the Prospect. In the event we incur the full cost of drilling the first well which results in a dry hole, we will then have the exclusive right and option to participate in any and all further drilling programs on the Prospect and to incur the full costs of drilling a second well to completion on the Prospect. This will deem us as having earned its option to acquire the 75% interest of the Bonanza Resources Interest in both that well and the balance of the Prospect.
 
Therefore, in light of the fact that the Bonanza Resources Interest is actually comprised of a number of acres materially less than originally represented by Bonanza Resources, we: (i) advised the public that we believed the accurate number of acres forming the Bonanza Resources Interest is approximately 5,600 acres and that our website has been amended accordingly; and (ii) advised the public of the Amendment.
 
During fiscal year ended December 31, 2009, we paid to Bonanza $115,000. The balance of $35,000 was due by December 31, 2009. Subsequently on January 12, 2010, the non-refundable payment was amended from $150,000 to $125,000. On January 15, 2010, we made the final payment of $10,000.
 
On January 15, 2010, we entered into a participation agreement to finance drilling and completion costs with two partners who will pay 67% of the costs of the first well in the Prospect. We were to pay 33% of the drilling and completion costs. To December 31, 2009, we had accrued the entire estimated cost of the first well of $475,065, of which $316,690 was paid to us during fiscal year ended December 31, 2009 by the new participants. Also during fiscal year ended December 31, 2009, we received a reduction in the well cost from the operator totaling $189,413, which resulted in amounts payable by the new participants being reduced to $190,530. Of the excess paid during fiscal year ended December 31, 2009 by the new participants, $63,022 remains payable as of June 30, 2010 and has been included in accounts payable and accrued liabilities.
 
Our management decided to prioritize the exploration drilling program on the North Fork 3D prospect in Beaver County. We completed a multi-component interpretive 3-D survey on approximately 8,500 acres to image the Morrow A and B sands. Management believed that the 3-D interpretive survey identified approximately forty drill ready target locations. On February 1, 2010, we were informed by our operator that it had drilled the Nowlin #1-19 well to a depth of 8,836 feet. After review of the drilling logs, we have determined that oil is not producible in the targeted Morrow A and B sand formations. As of the date of this Quarterly Report, the well has been plugged and abandoned and we have written off our share of the dry hole costs of the well of $230,524.
 
 
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Mississippi Prospect

Effective on August 26, 2010, our Board of Directors authorized the execution of an option agreement dated August 26, 2010 (the “Option Agreement”) with Westrock Land Corp. (“Westrock”), to purchase approximately 21,000 net acres of mineral oil and gas leases on lands located in Lamar, Jones and Forrest counties in the State of Mississippi (the “Acquired Properties”).  The Company has entered into the Option Agreement with Westrock, as the mineral leaseholder, and has received representations that Westrock owns all right, title and interest to all depths, including the Haynesville Shale Formation pursuant to the oil and gas leases with a minimum 75% net revenue interest.
 
In accordance with the terms and provisions of the Option Agreement: (i) we agreed to issue to Westrock an aggregate of 75,000,000 restricted shares of our common stock by November 30, 2010; (ii) Westrock granted us a period to conduct due diligence to October 31, 2010; and (iii) at closing, Westrock would convey to us the Acquired Properties by assignment and bill of sale and other associated documentation.

We subsequently completed due diligence on the Acquired Properties and issued 75,000,000 restricted common shares to Westrock on October 21, 2010 with an estimated fair value of $3,000,000. Due to current market conditions, management decided to fully impair these properties during fiscal year ended December 31, 2011 and, thus, an impairment charge of $3,000,000 was recorded.
 
RESULTS OF OPERATION
 
   
Three Months Ended
June 30
   
Six Months Ended
June 30
   
Inception (October 19, 2004) to June 30,
 
   
2012
   
2011
   
2012
   
2011
   
2012
 
                               
GENERAL AND ADMINISTRATIVE EXPENSES
                         
Consulting fees
    22,200       10,750       22,700       12,000       903,237  
Impairment of oil and gas properties (Note 4)
    -       -       -       -       6,708,952  
Investor relations
    -       -       -       -       921,268  
Management fees (Note 10)
    27,520       26,520       54,040       53,040       3,781,078  
Office and general (recovery)
    29,836       25,767       51,453       49,758       936,733  
Professional fees
    9,075       7,026       25,173       20,123       1,091,746  
                                         
NET OPERATING LOSS:
    (88,631 )     (70,063 )     (153,366 )     (134,921 )     (14,343,014 )
                                         
OTHER EXPENSE
                                       
     Gain on expired oil and gas lease option
    -       -       -       -       100,000  
Abandonment expense
    (50,000 )     -       (50,000 )     -       (50,000 )
     Financing costs
    -       -       -       -       (424,660 )
     Interest expense
    (5,430 )     (2,159 )     (9,302 )     (4,619 )     (147,531 )
                                         
TOTAL OTHER EXPENSE
    (55,430 )     (2,159 )     (59,302 )     (4,619 )     (522,191 )
                                         
NET LOSS
  $ (144,061 )   $ (72,222 )   $ (212,668 )   $ (139,540 )   $ (14,865,205 )
 
 
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We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.

We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.

Six Month Period Ended June 30, 2012 Compared to Six Month Period Ended June 30, 2011

Our net loss for the six month period ended June 30, 2012 was ($212,668) compared to a net loss of ($139,540) during the six month period ended June 30, 2011 (an increase of $73,128). During the six month periods ended June 30, 2012 and 2011, we did not generate any revenue.

During the six month period ended June 30, 2012, we incurred general and administrative expenses of $153,366 compared to $134,921 incurred during the six month period ended June 30, 2011 (an increase of $18,445). These general and administrative expenses incurred during the six month period ended June 30, 2012 consisted of: (i) consulting fees of $22,700 (2011: $12,000); (ii) office and general of $51,453 (2011: $49,758); (iii) professional fees of $25,173 (2011: $20,123); and (iv) management fees – related party of $54,040 (2011: $53,040).

General and administrative expenses incurred during the six month period ended June 30, 2012 compared to the six month period ended June 30, 2011 increased primarily due to slightly higher office and general expenses as we increased our scope of business with the acquisition of Glob Media.

Of the $153,366 incurred as general and administrative expenses during the six month period ended June 30, 2012, we incurred management fees of $54,040. As of June 30, 2012, the total amount due and owing in accrued and unpaid management fees and expenses was $36,654.

During the six month period ended June 30, 2012 interest expense incurred was $9,302 (2011: $4,619) and abandonment expense incurred for plugging and abandoning the Boggs #1 well was $50,000 (2011: Nil). Our net loss during the six month period ended June 30, 2012 was ($212,668) or ($0.00) per share compared to a net loss of ($134,540) or ($0.00) per share during the six month period ended June 30, 2011. The weighted average number of shares outstanding was 265,165,690 for the six month period ended June 30, 2012 compared to 263,960 for the six month period ended June 30, 2011.

Three Month Period Ended June 30, 2012 Compared to Three Month Period Ended June 30, 2011

Our net loss for the three month period ended June 30, 2012 was ($144,061) compared to a net loss of ($72,222) during the three month period ended June 30, 2011 (a decrease of $71,839). During the three month periods ended June 30, 2012 and 2011, we did not generate any revenue.
 
 
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During the three month period ended June 30, 2012, we incurred general and administrative expenses of $88,631 compared to $70,063 incurred during the three month period ended June 30, 2011 (an increase of $18,568). These general and administrative expenses incurred during the three month period ended June 30, 2012 consisted of (i) office and general of $29,836 (2011: $25,767); (ii) professional fees of $9,075 (2011: $7,026); (iii)  consulting fees of $22,200 ( 2011: $10,750) and (iv) management fees – related party of $27,520 (2011: $26,520).

General and administrative expenses incurred during the three month period ended June 30, 2012 compared to the three month period ended June 30, 2011 increased primarily due to higher office and general expenses as we increased our scope of business with the acquisition of Glob Media.

During the three month period ended June 30, 2012 interest expense incurred was $5,430 (2011: $2,159) and abandonment expense incurred for plugging and abandoning the Boggs #1 well was $50,000 (2011: Nil). Our net loss during the three month period ended June 30, 2012 was ($144,061) or ($0.00) per share compared to a net loss of ($72,222) or ($0.00) per share during the three month period ended June 30, 2011. The weighted average number of shares outstanding was 267,269,420 for the three month period ended June 30, 2012 compared to 263,061,960 for the three month period ended June 30, 2011.

LIQUIDITY AND CAPITAL RESOURCES

As at June 30, 2012

As at June 30, 2012, our current assets were $15,824 and our current liabilities were $957,173, which resulted in a working capital deficiency of ($941,349). As at June 30, 2012, current assets were comprised of: (i) $8,613 in cash; and (ii) $7,211 in prepaid and other assets. As at June 30, 2012, current liabilities were comprised of: (i) 279,430 in accounts payable and accrued liabilities; (ii) $351,243 in due to related parties; (iii) $200,000 in loan payable and (iv) $126,500 in loans payable to related party.

As at June 30, 2012, our total assets were $363,428 comprised of: (i) $15,824 in current assets; (ii) $3,143 in equipment and (iii) $344,461 in intellectual property. The increase of total assets as of June 30, 2012 from December 31, 2011 was primarily due to the increase in intellectual property.

As at June 30, 2012, our total liabilities were $957,173 comprised entirely of current liabilities. The increase in liabilities for the six month period ended June 30, 2012 from fiscal year ended December 31, 2011 was primarily due to an increase in loans payable.

Stockholders’ equity increased from $(778,349) as of December 31, 2011 to stockholders’ equity of $(593,745) as of June 30, 2012.

 
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Cash Flows from Operating Activities

We have not generated positive cash flows from operating activities. For the six month period ended June 30, 2012, net cash flows used in operating activities was ($141,193), consisting primarily of a net loss of ($212,668). Net cash flows used in operating activities was changed by $9,302 in accrued interest, $579 in prepaid and other, $91,790 in due to related parties and $301,96 in accounts payable and accrued liabilities.

Cash Flows from Investing Activities

For the six month period ended June 30, 2012, net cash flows provided by investing activities was $187 for the acquisition of Glob Media net of cash received.

Cash Flows from Financing Activities

We have financed our operations primarily from either advancements or the issuance of equity and debt instruments. For the six month period ended June 30, 2012, net cash flows provided from financing activities was $145,500 compared to $80,333 for the six month period ended June 30, 2011. Cash flows from financing activities for the six month period ended June 30, 2012 consisted of $120,500 in advances from related parties and $25,000 from loan proceeds.

We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.

PLAN OF OPERATION AND FUNDING

We intend to introduce an ad placement model to third party ad publishers as traffic increases and it reaches its bench mark growth of approximately 1.0 million visitors and 5-10% active recurring users on an annualized basis. We expect to focus on significantly increasing user recurring measurements as its mobile applications become available and as its desktop product becomes thoroughly tuned from continuous development. Since we do not rely on registered members to generate its site activities, we primarily refer to our users as visitors whether they are simply conducting search functions or performing more complex interactions within its site. As we generate a measurable benchmark of population activities from desktop and mobile, we expect to form alliances and relationships with national and localized advertising publishers on a “special ad offer” basis. This will result in users being able to receive special promotional offerings on services or products within their local area or receive immediate special promotions specific to user interest based on their bookmarking criteria and collaboration projects with other users.

Remaining within the focus of being an “Open Information Network” managed by its users, we expect to expand our services to value-add a subscription or pay-per-use content service for our users. We are currently exploring relationships with various third party content providers in the areas of academic and other published research material. This would be a value add to users of the product to be able to find and retrieve for a small fee, hard to find research or other online materials in diverse categories.
 
 
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Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next six months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. We may expect to need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.

MATERIAL COMMITMENTS

During 2010, a shareholder made advances of $94,167 which were due and owing as of December 31, 2010, which bears interest at 8% per annum and has no specific repayment terms. During 2011, this shareholder made further advances of $80,000 which bears interest at 8% per annum and has no specific repayment terms. The balance owing of $159,167 and $5,220 in principal and interest respectively was repaid on May 16, 2011. During the six month period ended June 30, 2012, the shareholder made further advances of $25,500 and the Company issued 3,500,000 common shares valued at $21,000 to settle advances from this shareholder. Total accrued interest was $1,469 leaving a total of $20,969 due and owing to the shareholder as of June 30, 2012.

During the six month period ended June 30, 2012, another shareholder made advances of $95,000 .  The advances bear interest at 8% per annum and have no specific repayment terms.  Total accrued interest was $649 leaving a total of $95,649 owing to this shareholder at June 30, 2012.

During fiscal year ended December 31, 2011, we received loan proceeds of $175,000 from an unrelated third party. The loan was evidenced in a promissory note dated May 15, 2011 and maturing November 15, 2011. The promissory note bears interest at the rate of 10% per annum of which a total of $17,941 has accrued as at June 30, 2012. This note is due on demand.

During the six month period ended June 30, 2012, we received loan proceeds of $25,000 from an unrelated third party pursuant to a promissory note. The promissory note is due on demand and bears interest at a rate of 10% per annum of which a total of $525 has been accrued for interest as of June 30, 2012.

PURCHASE OF SIGNIFICANT EQUIPMENT

We do not intend to purchase any significant equipment during the next twelve months.

OFF-BALANCE SHEET ARRANGEMENTS

As of the date of this Quarterly Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
 
 
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GOING CONCERN

The independent auditors' report accompanying our December 31, 2011 and December 31, 2010 financial statements contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared "assuming that we will continue as a going concern," which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.

ITEM III. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
 
Market risk represents the risk of loss that may impact our financial position, results of operations or cash flows due to adverse change in foreign currency and interest rates. 
 
Exchange Rate
 
Our reporting currency is United States Dollars (“USD”).  In the event we acquire any properties outside of the United States, the fluctuation of exchange rates may have positive or negative impacts on our results of operations. However, since all of our properties are currently located within the United States, any potential revenue and expenses will be denominated in U.S. Dollars, and the net income effect of appreciation and devaluation of the currency against the U.S. Dollar would be limited to our costs of acquisition of property.
 
Interest Rate
 
Interest rates in the United States are generally controlled. Any potential future loans will relate mainly to acquisition of properties and will be mainly short-term. However our debt may be likely to rise in connection with expansion and if interest rates were to rise at the same time, this could become a significant impact on our operating and financing activities. We have not entered into derivative contracts either to hedge existing risks for speculative purposes.
 
ITEM IV. CONTROLS AND PROCEDURES
 
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
 
We have performed an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), of the effectiveness of our disclosure controls and procedures, (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation, our management, including our CEO and CFO, concluded that our disclosure controls and procedures were effective as of June 30, 2012 to provide reasonable assurance that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
 
 
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Management’s Quarterly Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Under the supervision and with the participation of the Company’s management, including the chief executive officer and principal financial officer, we evaluated the effectiveness of our internal control over financial reporting as of June 30, 2012. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework.

This Quarterly Report does not include an attestation report of our registered public accounting firm De Joya Griffith & Company, LLC regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this Quarterly Report on Form 10-Q.

Inherent Limitations on Effectiveness of Controls

We believe that a controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives, and our CEO and our CFO have concluded that these controls and procedures are effective at the “reasonable assurance” level.
 
Changes in internal controls

There were no changes in internal controls for the six month period ended June 30, 2012.

AUDIT COMMITTEE REPORT

The Company previously had an Audit Committee with three appointed members . Two members were “independent” within the meaning of Rule 10A-3 under the Exchange Act and were in addition financial experts. As of the date of this 10-Q and with the resignation of the prior members of the Board of Directors and executive officers, the Company no longer has an Audit Committee. However, the Company intends to appoint new members to the Audit Committee during fiscal year 2012. The Audit Committee operates under a written charter adopted by the Board of Directors on November 20, 2004. The Board of Directors pursuant to a special meeting held on December 18, 2008 adopted an amended audit committee charter and responsibilities.

The Audit Committee's primary function is to provide advice with respect to our financial matters and to assist the Board of Directors in fulfilling its oversight responsibilities regarding finance, accounting, and legal compliance. The Audit Committee's primary duties and responsibilities will be to: (i) serve as an independent and objective party to monitor the Company's financial reporting process and internal control system; (ii) review and appraise the audit efforts of the Company's  independent accountants; (iii) evaluate the Company's quarterly financial performance as well as the Company's compliance with laws and regulations; (iv) oversee management's establishment and enforcement of financial policies and business practices; and (v) provide an open avenue of communication among the independent accountants, management and the Board of Directors.

 
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PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

No report required.

ITEM IA.  RISK FACTORS

No report required.

ITEM 2. UNREGISTERED SALES OF SECURITIES AND USE OF PROCEEDS

Share Exchange Agreement

Effective June 29, 2012, we issued an aggregate of 45,378,670 shares of our restricted common stock to the Glob Media Shareholders at a per share price of $0.006. Our securities issued to the Glob Media Shareholders upon the closing of the Share Exchange Agreement have not been registered under the Securities Act of 1933, as amended, or under the  securities laws of any state in the United States, and were issued in reliance upon an exemption from registration under the Securities Act of 1933. The securities may not be offered or sold in the United States absent registration under the Securities Act of 1933 or an applicable exemption from such registration requirements.

Settlement of Debt

Our Board of Directors, pursuant to unanimous adoption of consent resolutions of the Board of Directors (the "Board of Directors Consent Resolutions") dated effective as of June 15, 2012 (the "Effective Date"), approved and authorized the settlement of an aggregate $135,000 (the "Debt") of an aggregate $204,572 in current indebtedness due and owing to five certain lenders (the "Lenders"). We owed the aggregate $204,572 to the Lenders, which was associated with loan principal, accrued interest and/or services rendered. The Board of Directors authorized the settlement of the Debt by the issuance of an aggregate 22,500,000 shares of our restricted common stock at $0.006 per share effective as of June 15, 2012. Our shares of common stock were previously trading on the OTC Bulletin Board at approximately $0.0054 per share from April 15, 2012 to the Effective Date. The aggregate 22,500,000 shares of restricted common stock were issued to the five Lenders as of the Effective Date.
 
 
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The settlement of the Debt was made to five non-United States Creditors in reliance on Rule 903 of Regulation S promulgated under the Securities Act of 1933, as amended (the “Securities Act”). The securities issued in the settlement of the Debt have not been registered under the Securities Act or under any state securities laws and may not be offered or sold without registration with the United States Securities and Exchange Commission or an applicable exemption from the registration requirements. There were no finders' fees or commissions' payable by us upon the successful completion of the settlement of the Debt.
 
The shareholders acknowledged that the securities to be issued have not been registered under the Securities Act, that they understood the economic risk of an investment in the securities, and that they had the opportunity to ask questions of and receive answers from our management concerning any and all matters related to acquisition of the securities.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

No report required.

ITEM 5. OTHER INFORMATION

No report required.
 
 
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ITEM  6.  EXHIBITS AND REPORTS ON FORM 8-K
 
3.1   Articles of Incorporation (1)
     
3.2   Bylaws (1)
     
4.1   Chapman Oil and Gas Lease (2)
     
4.2   Hurley Oil and Gas Lease (2)
     
4.3   Lease Assignment between Geneva Energy Corp. And Morgan Energy Corp. dated December 17, 2004 (2)
     
4.4   Fletcher Lewis Letter (3)
     
4.5   Fletcher Lewis Consent dated December 31, 2004 (3)
     
4.6    American News Publishing Letter dated January 13, 2006 (3)
     
10.1   Asset Purchase Agreement between Morgan Creek Energy Corp. and Geneva Energy Corp. Dated December 15, 2004 (1)
     
10.2   Share Exchange Agreement among Morgan Creek Energy Corp., Glob Media Works Inc. and the shareholders of Glob Media Works Inc. (8)
     
10.2   Charter of Audit Committee (1)
     
10.3   Executive Services Agreement between Morgan Creek Energy Corp, Westhampton Ltd., and David Urquhart dated April 30, 2008. (5)
     
10.4   Option Agreement between Morgan Creek Energy Corp. nd Westrock Land Corp dated October 31, 2008.  (6)
     
10.5   Option Agreement between Morgan Creek Energy Corp. and Westrock Land Corp. dated August 26, 2010 (7)
     
14   Code of Business Conduct (1)
     
16   Letter of Dale Matheson Carr-Hilton LaBonte LLP Chartered Accountants (4)
     
31.1   Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of The Securities Exchange Act.
     
31.2   Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of The Securities Exchange Act.
     
32.1   Certification of Chief Executive Officer and Chief Financial Officer under Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act.
     
101.INS **
 
XBRL Instance Document
     
101.SCH **
 
XBRL Taxonomy Extension Schema Document
     
101.CAL **
 
XBRL Taxonomy Extension Calculation Linkbase Document
     
101.DEF **
 
XBRL Taxonomy Extension Definition Linkbase Document
     
101.LAB **
 
XBRL Taxonomy Extension Label Linkbase Document
     
101.PRE **
 
XBRL Taxonomy Extension Presentation Linkbase Document

 
33 

 

(1) Incorporated by reference from Form SB-2 filed with the Commission on April 11, 2005.

(2) Incorporated by reference from Form SB-2/A filed with the Commission on June 14, 2005.

(3) Incorporated by reference from Form SB-2/A filed with the Commission on January 13, 2006.

(4) Incorporated by reference from Form Current Report on 8-K filed with the Commission on August 3, 2008.

(5) Incorporated by reference from Form Current Report on 8-K filed with the Commission on April 5, 2008.

(6) Incorporated by reference from Form Current Report on 8-K filed with the Commission on November 5, 2008.

(7)  Incorporated by reference from Form Current Report on 8-K filed with the Commission on August 27, 2010.

(8)  Incorporated by reference from Form Current Report on 8-K filed with the Commission on June 29, 2012.
 
** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
 
 
34

 

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
  TAGLIKEME CORP.  
       
Dated: August 20, 2012
By:
/s/  Richard Elliot Square  
    Richard Elliot Square President and  
    Chief Executive Officer  
       
       
Dated: August 20, 2012   By: /s/ William D. Thomas  
    William D. Thomas,  
    Chief Financial Officer  
 
 
 
 
 
 
35

XFRA:M6C1 Quarterly Report 10-Q Filling

XFRA:M6C1 Stock - Get Quarterly Report SEC Filing of XFRA:M6C1 stocks, including company profile, shares outstanding, strategy, business segments, operations, officers, consolidated financial statements, financial notes and ownership information.

XFRA:M6C1 Quarterly Report 10-Q Filing - 6/30/2012
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