PINX:MULI Multi-Corp International Inc Quarterly Report 10-Q Filing - 6/30/2012

Effective Date 6/30/2012

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UNITED STATES
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 quarterly period ended June 30, 2012
   
[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
   
 
For the transition period from __________ to ______________

000-54252
(Commission File Number)
   
MULTI-CORP INTERNATIONAL INC.
(Exact name of registrant as specified in its charter)
   
Nevada
33-1225125
 
(I.R.S. Employer Identification No.)
   
 952 N. Western Ave., Los Angeles, CA
90029
(Address of principal executive offices)
(Zip Code)
   
(888) 744-7090
(Registrant’s telephone number, including area code)
 
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 
Yes [X]  No [ ]

Indicate by 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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
 
Yes [  ]  No (not required) [ X ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer
[  ]
Accelerated filer
[  ]
       
Non-accelerated filer
[  ]
Smaller reporting company
[X]
(Do not check if a smaller reporting company)
     
 
 
 
 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 
Yes [  ]  No [X]

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

 
Yes [  ]  No [  ]

APPLICABLE ONLY TO CORPORATE ISSUERS

193,087 common shares outstanding as of August 6, 2012
(Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.)

 
2

 

MULTI-CORP INTERNATIONAL INC.
TABLE OF CONTENTS


   
Page
 
PART I – FINANCIAL INFORMATION
 
     
Item 1.
Consolidated Financial Statements
  4
     
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
  12
     
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
  14
     
Item 4.
Controls and Procedures
  14
     
 
PART II – OTHER INFORMATION
 
     
Item 1.
Legal Proceedings
  15
     
Item 1A.
Risk Factors
  15
     
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
  15
     
Item 3.
Defaults Upon Senior Securities
  15
     
Item 4.
Mine Safety Disclosures
  15
     
Item 5.
Other Information
  16
     
Item 6.
Exhibits
  16
     
 
SIGNATURES
  17



 
3

 

PART I

ITEM 1.    FINANCIAL STATEMENTS

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions for Form 10-Q and Article 210 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal recurring nature. Operating results for the three and six month periods ended June 30, 2012, are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2012. For further information refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011.

 
Page
   
Financial Statements
 
   
Consolidated Balance Sheets
  5
   
Consolidated Statements of Operations and Comprehensive Loss
  6
   
Consolidated Statements of Cash Flows
  7
   
Notes to Consolidated Financial Statements
  8 to 11

 
4

 

MULTI-CORP INTERNATIONAL INC.  
(A DEVELOPMENT STAGE COMPANY)
Consolidated Balance Sheets

ASSETS
 
As Of June 30, 2012
   
As Of December 31, 2011
 
Current
           
Cash
  $ -     $ -  
Total Current Assets
    -       -  
                 
Intangibles, net
    130,666       -  
Total Assets
  $ 130,666     $ -  
                 
LIABILITIES
               
Current
               
Accounts payable and accrued liabilities
    266,240       238,977  
Short term notes
    54,412       54,412  
Advances from stockholders
    218,017       218,017  
  Liabilities of discontinued operations
    -       32,446  
Total Current Liabilities
    538,669       543,852  
                 
STOCKHOLDERS’ DEFICIT
               
                 
Preferred stock, $0.0001 par value, non-voting, 20,000,000 authorized, none issued and outstanding
    -       -  
Common stock, $0.0001 par value, voting, 500,000,000 authorized, 193,087 and 149,498 issued and outstanding as at June 30, 2012 and December 31, 2011 respectively
    19       15  
Additional Paid-in Capital
    1,100,931       707,935  
Deficit accumulated during the development stage
    (1,508,953 )     (1,251,802 )
Total Stockholders’ Deficit
    (408,003 )     (543,852 )
Total Liabilities and Stockholders’ Deficit
  $ 130,666     $ -  

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

 
5

 

MULTI-CORP INTERNATIONAL INC.   
(A DEVELOPMENT STAGE COMPANY)
Consolidated Statements of Operations and Comprehensive Loss
For The Three and Six Months Ended June 30, 2012 and 2011
and for The Period FromInception (September 21, 2010) to June 30, 2012

   
Three months ended June 30,
   
Six months ended June 30,
   
Inception
(September 21, 2010)
to June 30,
 
   
2012
   
2011
   
2012
   
2011
   
2012
 
                               
                               
Operating Expenses
                             
Professional fees
    12,907       22,736       16,624       180,914       208,891  
Amortization
    7,000       -       9,333       -       9,333  
Stock-based compensation
    -       -       250,000       -       250,000  
  General and administrative expenses
    4,751       6,731       11,469       16,119       30,945  
Loss from continuing operations
    (24,658 )     (29,467 )     (287,426 )     (197,033 )     (499,169 )
                                         
Other Income (expense)
                                       
 Interest expense
    (1,086 )     -       (2,171 )     -       (3,458 )
Loss before discontinued operations
    (25,744 )     (29,467 )     (289,597 )     (197,033 )     (502,627 )
Gain/(loss)from discontinued operations
    32,446       (1,590 )     32,446       (7,745 )     14,661  
                                         
Net income (loss)
  $ 6,702     $ (31,057 )   $ (257,151 )   $ (204,778 )   $ (487,986 )
                                         
Basic and diluted Net income (loss) per share from continuing operations
  $ (0.13 )   $ (0.20 )   $ (1.69 )   $ (1.45 )        
Basic and diluted Net income (loss) per share from discontinued operations
    0.17       (0.01 )     0.19       (0.05 )        
Basic and diluted Net income (loss) per share
  $ 0.03     $ (0.21 )   $ (1.50 )   $ (1.50 )        
                                         
Weighted average number of shares outstanding
    193,087       149,498       171,421       136,349          

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

 
6

 

MULTI-CORP INTERNATIONAL INC.  
(A DEVELOPMENT STAGE COMPANY)
Consolidated Statements of Cash Flows
For The Six Months Ended June 30, 2012 and 2011
and For the Period From Inception (September 21, 2010) to June 30, 2012


         
Inception
 
   
Six Months Ended
   
(September 21, 2010)
 
   
June 30,
   
Through
 
   
2012
   
2011
   
June 30, 2012
 
                   
Cash flows from operating activities
                 
Net loss
  $ (257,151 )   $ (204,778 )   $ (487,986 )
Adjustment to reconcile net loss to cash used by operations:
                       
Stock-based compensation
    250,000       -       250,000  
Amortization
    9,333       -       9,333  
Accrued interest
    2,171       -       3,458  
Gain on divestiture of AquaSil
    (32,446 )     -       (32,446 )
Change in operating assets and liabilities:
                       
Accounts payable and accrued liabilities
    28,093       181,922       164,623  
Net cash used in continuing operations
    -       (22,856 )     (93,018 )
Net cash used in discontinued operations
    -       -       -  
Net cash used in operating activities
    -       (22,856 )     (93,018 )
                         
Cash flows from financing activities
                       
Acquisition of AquaSil Inc.
    -       -       1,000  
Proceeds from short term notes
    -       -       54,412  
Advances from stockholders
    -       5,160       5,160  
Net cash provided by financing activities, continuing operations
    -       5,160       60,572  
Net cash provided by financing activities in discontinued operations
    -       17,500       32,446  
Net cash provided by financing activities
    -       22,660       93,018  
                         
Decrease in cash during the period
    -       (196 )     -  
Cash, beginning of period
    -       865       -  
Cash, end of period
  $ -     $ 669     $ -  
                         
Supplemental disclosure of cash flow information:
                       
    Interest
  $ -     $ -     $ -  
    Income taxes
  $ -     $ -     $ -  
                         
Non-cash transactions:
                       
Common stock issued in settlement of accounts payable
    3,000       -       3,000  
Common stock issued for settlement of advances from stockholders
            -       700,000  
Common stock issued to acquire intangibles
    140,000       -       140,000  
Common stock issued for stock-based compensation
    250,000       -       250,000  

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

 
7

 

MULTI-CORP INTERNATIONAL INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
For The Period from Inception (September 21, 2010) To June 30, 2012

1.       ORGANIZATION, NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Organization and Nature of Operations

Gray Creek Mining, Inc. was incorporated on December 10, 2006 under the laws of the State of Nevada. A Certificate of Amendment was filed with the Nevada Secretary of State, on November 7, 2008, changing the Company’s name to BWI Holdings, Inc. A Certificate of Amendment was filed with the Nevada Secretary of State, on January 27, 2011, changing the Company’s name to Aquasil International Inc. On May 22, 2012, the Board of Directors of the Company authorized a name change to Multi-Corp International Inc. (the “Company”) pursuant to written consent resolutions from the Board of Directors and the majority shareholders dated May 22, 2012 approved a change in the name of the Company from “Aquasil International Inc.” to “Multi-Corp. International Inc.” to better reflect the additional business operations of the Company.

On December 30, 2010, the Company entered into a stock exchange agreement (the “Stock Exchange Agreement”) with AquaSil, Inc., a New York corporation (“AquaSil”) and the sole stockholder of AquaSil.  In accordance with the Stock Exchange Agreement, the Company acquired 100% of the total issued and outstanding shares of common stock of AquaSil in exchange for the issuance of an aggregate 70,000 shares of the Company’s common stock to the sole stockholder of AquaSil. As a result of this transaction, AquaSil became a wholly-owned subsidiary of the Company.

The Company’s wholly owned subsidiary, AquaSil, was incorporated in the State of New York on September 21, 2010 to engage in the business of selling various water and soft drink products.  On March 31, 2012, the Company divested itself of this wholly-owned subsidiary and determined not to continue in the water business. The Company has consolidated AquaSil up to March 31, 2012.  As of April 1, 2012, the Company no longer consolidates the investment in AquaSil with the Company, which is presented as discontinued operations as of April 1, 2012

On February 1, 2012, the Company entered into an acquisition agreement (the “Agreement”) with Oveldi Canada Ltd., a Canadian Corporation (“OVE”) whereby the Corporation will acquire the rights to certain intellectual property for a proprietary software application called EviCAT©. In accordance with the terms and provisions of the Agreement, the Corporation acquired the rights to the intellectual property from OVE in exchange for the issuance of 14,000 shares of the Corporation’s restricted common stock.

On May 22, 2012, the Board of Directors authorized the Company to implement a reverse stock split of the Company’s outstanding shares of Common Stock at a ratio of 1000:1 and to file all required documents to the requisite regulatory authorities to implement the reverse split. All share and per share amounts used in the Company’s consolidated financial statements have been restated to reflect the 1000 for 1 reverse stock split.

Basis of Presentation

The Company is in the development stage and has no revenues. A development stage company is one in which all efforts are devoted substantially to establishing a new business and even if planned principal operations have commenced, revenues are insignificant.

These consolidated financial statements include the accounts of Multi-Corp International Inc. and up to March 31, 2012 includes the accounts of AquaSil. As of April 1, 2012, the Company no longer consolidates the accounts of AquaSil with the Company, which is presented as discontinued operations as of April 1, 2012.

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions for Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal recurring nature. Operating results for the three and six month periods ended June 30, 2012, are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2012. For further information refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

 
8

 

MULTI-CORP INTERNATIONAL INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
For The Period from Inception (September 21, 2010) To June 30, 2012


 2.       GOING CONCERN

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The Company is a development stage company and is dependent on raising capital to commence principal operations. These circumstances raise substantial doubt about the Company’s ability to continue as a going concern.

Management believes the Company’s ability to continue as a going concern is dependent on its ability to raise capital. At present, the Company has no commitments for any additional financing. Management is currently seeking financing through a possible offering of common stock, which will be used to finance operations. Until such financing is obtained, it is the intent of stockholders to provide funds for professional fees related to maintaining the Company’s public reporting status.

The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

3.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Stock-Based Compensation

The Company follows the guidance included in ASC 718 Compensation-Stock Compensation (“ASC 718”) using the modified prospective transition method. The Company recognizes compensation expense in the financial statements for share-based awards based on the grant date fair value of those awards.

Intangible Assets

Acquired intangible assets are recognized at cost and are classified as assets with finite useful lives. The Company amortizes the intangible assets with five years using the straight-line method over the estimated economic lives of the assets.

Recent Accounting Pronouncements

 
In December 2011, the FASB issued Accounting Standards Update (“ASU”) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities.” The amendments in this update require enhanced disclosures around financial instruments and derivative instruments that are either (1) offset in accordance with either ASC 210-20-45 or ASC 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in accordance with either ASC 210-20-45 or ASC 815-10-45. An entity should provide the disclosures required by those amendments retrospectively for all comparative periods presented. The amendments are effective during interim and annual periods beginning on or after 1 January 2013. The Company does not expect this guidance to have any impact on its financial position, results of operations or cash flows.

In July 2012, the FASB issued ASC Update No. 2012-02, “Intangibles - Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment”(“ASU 2012-02”). ASU 2012-02 provides companies with the option to assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that the indefinite-lived intangible asset is impaired. If the Company concludes that it is more likely than not that the asset is impaired, it is required to determine the fair value of the intangible asset and perform the quantitative impairment test by comparing the fair value with the carrying value in accordance with Topic 350. If the Company concludes otherwise, no further quantitative assessment is required. ASU-2012-02 is effective for annual and interim impairment tests performed for fiscal years beginning after 15 September 2012. Early adoption is permitted. The Company does not expect the adoption of ASU 2012-02 to impact its results of operations or financial position.

 
9

 

MULTI-CORP INTERNATIONAL INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
For The Period from Inception (September 21, 2010) To June 30, 2012

4.       INTANGIBLES

On February 1, 2012, the Company entered into an acquisition agreement (the “Agreement”) with Oveldi Canada Ltd., a Canadian Corporation (“OVE”) whereby the Corporation acquired the rights to certain intellectual property for a proprietary software application called EviCAT©. In accordance with the terms and provisions of the Agreement, the Corporation acquired the rights to the intellectual property from OVE in exchange for the issuance of 14,000 shares of the Corporation’s restricted common stock. The shares of common stock were issued on February 27, 2012, and the transaction was valued at the fair market value of the Company’s common stock on the date of issuance of $10 per share, totaling $140,000. The software application has been identified as an intangible asset, with a useful life of five years. At the present time the Company is evaluating applications for the licensing of EviCAT© to third party users.

During the three and six month periods ended June 30, 2012, amortization of purchased intangible assets included in operating expenses was $7,000 and $9,333, respectively, compared to NIL in the same periods of fiscal 2011.
 
5.       LICENSE AGREEMENT AND DISCONTINUED OPERATIONS

On December 30, 2010, the Company entered into a stock exchange agreement (the “Stock Exchange Agreement”) with AquaSil, Inc., a New York corporation (“AquaSil”) and the sole stockholder of AquaSil.  In accordance with the Stock Exchange Agreement, the Company acquired 100% of the total issued and outstanding shares of common stock of AquaSil in exchange for the issuance of an aggregate 70,000 shares of the Company’s common stock to the sole stockholder of AquaSil. As a result of this transaction, AquaSil became a wholly-owned subsidiary of the Company.

The Company’s wholly owned subsidiary, AquaSil, was incorporated in the State of New York on September 21, 2010 to engage in the business of selling various water and soft drink products and held a licensing agreement for the sales of the licensed products. On March 31, 2012, the Company divested itself of this wholly-owned subsidiary and determined not to continue in the water business.  Under the terms of divestiture the Company agreed to return the shares of AquaSil to the original shareholder in return for the forgiveness of certain liabilities owned by the subsidiary, with no further consideration. The Company has consolidated AquaSil up to March 31, 2012.  As of April 1, 2012, the Company no longer consolidates the accounts of AquaSil with the Company, which is presented as discontinued operations as of April 1, 2012.
6.       ADVANCES FROM STOCKHOLDERS

On February 3, 2011, the Company issued 70,000 shares of common stock in settlement of $700,000 of advances from principal stockholders.

The amount of $218,017 at June 30, 2012 (December 31, 2011 - $218,017) consisted of amounts owed to the principal stockholders of the Company for amounts advanced to business operations. The amounts are unsecured, non-interest bearing and due on demand.

7.    SHORT TERM NOTES

As of June 30, 2012, the Company owed $54,412 (December 31, 2011 – $54,412) of short term notes. The amounts owing are unsecured, bear interest at 8% per annum, and are due on demand. During the three and six month periods ended June 30, 2012, the Company recorded  interest expense of $1,086 and $2,171, respectively, which amount is included with accounts payable and accrued liabilities on the consolidated balance sheets.
 
 
10

 

MULTI-CORP INTERNATIONAL INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
For The Period from Inception (September 21, 2010) To June 30, 2012


 
 

 

8    COMMON STOCK

On May 22, 2012, the shareholders holding a majority of the voting shares of the Company and the Board of Directors of the Company approved a name change of the Company from Aquasil International Inc. to Multi-Corp. International Inc. and the reverse split of the current issued and outstanding shares of the Company on the basis of one (1) new share for each one-thousand (1,000) shares currently held.   All share and per share amounts used in the Company’s consolidated financial statements have been restated to reflect the 1000 for 1 reverse stock split. As of June 30, 2012, the issued and outstanding number of shares of common stock is 193,087 which amount includes rounding-up of shares as a result of the reverse split.


On February 27, 2012, the Company issued 14,000 shares of the Corporation’s restricted common stock to Oveldi Canada Ltd. pursuant to the agreement whereby the Company acquired the rights to the EviCAT© software. The shares of common stock were valued at $10 per share, totaling $140,000, the fair market value of the shares on the date of issuance.

On February 27, 2012, the Company issued a total of 25,000 shares to Robert Baker as consideration for management services from the date of his appointment as a director and officer to the date of issuance. The shares were valued at the market value of the common stock on the date of issue of $10 per share for total consideration of $250,000. The Company recorded the amount of $250,000 as stock-based compensation.

On February 27, 2012, the Company issued a total of 3,000 shares to a shareholder of the Company in settlement of advances made by the shareholder totaling $3,000.
 
9.    RELATED PARTY TRANSACTIONS

The amount of $218,017 at June 30, 2012 (December 31, 2011 - $218,017) consisted of amounts owed to the principal stockholders of the Company for amounts advanced to business operations. The amounts are unsecured, non-interest bearing and due on demand.

On February 27, 2012, the Company issued a total of 25,000 shares to Robert Baker as consideration for management services valued at $250,000 from the date of his appointment as a director and officer to the date of issuance.

 
11

 

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

FORWARD-LOOKING STATEMENTS
This quarterly report contains forward-looking statements relating to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "intends", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential", or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors which may cause our or our industry's actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements.

Such factors include, among others, the following: international, national and local general economic and market conditions: demographic changes; the ability of the Company to sustain, manage or forecast its growth; the ability of the Company to successfully make and integrate acquisitions; raw material costs and availability; new product development and introduction; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; the loss of significant customers or suppliers; fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; and other factors referenced in this and previous filings.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or performance. Except as required by applicable laws, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Given these uncertainties, readers of this Form 10-Q and investors are cautioned not to place undue reliance on such forward-looking statements. The Company disclaims any obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.

All dollar amounts stated herein are in US dollars unless otherwise indicated.

The management’s discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The following discussion of our financial condition and results of operations should be read in conjunction with our audited financial statements on Form 10-K for December 31, 2011 together with notes thereto.

General Development of Business

Gray Creek Mining, Inc. was incorporated on August 10, 2006 under the laws of the state of Nevada. A Certificate of Amendment was filed with the Nevada Secretary of State, on November 7, 2008, changing the Company's name to BWI Holdings, Inc. On November 7, 2008, the Company also increased the authorized capital to 100,000,000 shares of common stock and 200,000,000 shares of preferred stock. A Certificate of Amendment was filed with the Nevada Secretary of State, on January 27, 2011, changing the Company's name to Aquasil International Inc. (the "Company"). On January 21, 2011, we amended our articles of incorporation to increase our authorized share capital from 100,000,000 to 500,000,000 shares of common stock.

Effective December 30, 2010, BWI Holdings, Inc., entered into a stock exchange agreement (the “Stock Exchange Agreement”) with Aquasil Inc., a New York corporation (“Aquasil”), and Ilya Khasidov, the sole shareholder of Aquasil (the “Aquasil Shareholder”). In accordance with the terms and provisions of the Stock Exchange Agreement, we acquired one hundred percent (100%) of the total issued and outstanding shares of common stock of Aquasil held of record by the Aquasil Shareholder in exchange for issuance of an aggregate 70,000 shares of our restricted common stock to the Aquasil Shareholder.

The Company’s wholly owned subsidiary, AquaSil, was incorporated in the State of New York on September 21, 2010 to engage in the business of selling various water and soft drink products.  On March 31, 2012, the Company divested itself of this wholly-owned subsidiary and determined not to continue in the water business. The Company has consolidated AquaSil up to March 31, 2012.  As of April 1, 2012, the Company no longer consolidates the accounts of AquaSil with the Company, which is presented as discontinued operations as of April 1, 2012.
 
On February 1, 2012, the Company entered into an acquisition agreement (the “Agreement”) with Oveldi Canada Ltd., a

 
12

 

Canadian Corporation (“OVE”) whereby the Corporation will acquire the rights to certain intellectual property for a proprietary software application called EviCAT©. In accordance with the terms and provisions of the Agreement, the Corporation acquired the rights to the intellectual property from OVE in exchange for the issuance of 14,000 shares of the Corporation’s restricted common stock.

Effective June 22, 2012, the Company changed its name to Multi-Corp International Inc. and effected a reverse split of the issued an outstanding shares of the Company on the basis of 1000:1. All share and per share amounts used in the Company’s financial statements have been restated to reflect the 1000 for 1 reverse stock split.

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

Summary

The Company intends to pursue the marketing and licensing of its proprietary software EviCAT which it acquired in February, 2012.

Liquidity & Capital Resources

We are a development stage company engaged in the exploitation of our proprietary software. To date, we have not generated any revenues.

As of June 30, 2012, the Company had no cash and a working capital deficit of $538,669 as compared to December 31, 2011 whereby the Company has no cash and a working capital deficit of $543,852. Since inception, the Company has financed its working capital needs through advances from stockholders. The Company believes it will require up to $1,000,000 in order to meet its proposed business operations over the next twelve months. The Company requires $250,000 for operating expenses including but not limited to marketing and advertising of its software, $250,000 for general and administrative expenses and $500,000 which will be allocated as follows: $240,000 for travel and promotional consideration, office expenses of $30,000 which were planned to start in June 2012, however, will start upon the Company raising the required capital, $180,000 for salaries of permanent administrative, managerial and software development staff and $50,000 for exploration of a break bulk terminal management software system. The Company's future liquidity requirements will be dependent upon the ability to raise financing either by debt or by equity through private placement transactions. Until such financing is obtained, it is the intent of stockholders to provide funds for professional fees related to maintaining the Company’s public reporting status.

The Company is a development stage company and is dependent on raising capital to commence principal operations. The Company has not begun operations of its acquired business, has incurred a loss for the period and is dependent on debt financing for its operating cash flow. These circumstances raise substantial doubt about the Company’s ability to continue as a going concern.

Management believes the Company’s ability to continue as a going concern is dependent on its ability to raise capital. At present, the Company has no commitments for any additional financing for operations, other than those fees which the Company expects to have provided to maintain its reporting status. Management is currently seeking financing through a possible private offering of common stock, which will be used to finance operations.

Results of Operations

For the three and six month, periods ended June 30, 2012 as compared to the three and nine month periods ended June 30, 2011:

Our operating results for the six and three month periods ended June 30, 2012 and 2011 and from inception to June 30, 2012 are summarized as follows:

 
13

 
 
   
For the three months ended
   
For the six months ended
   
From Inception
 
   
June 30,
   
June 30,
   
to June 30,
 
   
2012
   
2011
   
2012
   
2011
   
2012
 
Revenue
 
$
-
   
$
-
   
$
-
   
$
-
   
$
-
 
Professional fees
 
$
12,907
   
$
22,736
   
$
16,624
   
$
180,914
   
$
208,891
 
Amortization
 
$
7,000
   
$
-
   
$
9,333
   
$
-
   
$
9,333
 
Stock-based compensation
 
$
-
   
$
-
   
$
250,000
   
$
-
   
$
250,000
 
General and administration
 
$
4,751
   
$
6,731
   
$
11,469
   
$
16,119
   
$
30,945
 
Net operating loss
 
$
24,658
   
$
29,467
   
$
287,426
   
$
197,033
   
$
499,169
 

Revenues

We do not have any revenues and have not had any revenue since inception on September 21, 2010.

Operating Expenses

For the three months ended June 30, 2012 and 2011, we incurred $24,658 and $29,467, respectively, in total operating expenses, a period-to-period decrease of $4,809. The decrease in total expense is primarily a result of the decrease of $9,829 for professional expenses and $2,000 for general and administration , which is offset by an increase of $7,000 for amortization expenses from $Nil to $7,000.

For the six months ended June 30, 2012 and 2011, we incurred $287,426 and $197,033, respectively, in total operating expenses, a period-to-period increase of $90,393. The increase in total expenses is primarily a result of the increase of $250,000 for stock-based compensation and $9,333 for amortization, which is offset by a decrease of $164,290 for professional fees. The decrease in professional fees was related mainly to the fact that during 2011, the Company incurred substantial costs relating to the acquisition of AquaSil. Stock-based compensation for the six month period ended June 30, 2012 was $250,000 compared to $Nil for the comparable period ended June 30, 2011

Interest expense for the three and six months ended June 30, 2012 was $1,086 and $2,171, respectively with no comparative interest expense for the three and six months ended June 30, 2011.

Net Loss

Our net income (loss) for the three and six months ended June 30, 2012 was $6,702 and $(257,151), respectively, as compared to a net loss of ($149,498) and ($204,778), respectively, for the comparable three month and six month periods ended June 30, 2011.

The Company has not yet generated any revenues and is only able to undertake limited operations until such time as sufficient funding can be raised for operations.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is a smaller reporting company and is not required to provide this information.

ITEM 4.   CONTROLS AND PROCEDURES

 
14

 
 
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our principal executive officer and the principal financial officer, are responsible for conducting an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as of the end of the quarterly period covered by this report. Disclosure controls and procedures means that the material information required to be included in our Securities and Exchange Commission reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms relating to our company, including any consolidating subsidiaries, and was made known to us by others within those entities, particularly during the period when this report was being prepared. Based on this evaluation, our principal executive officer and principal financial officer concluded as of the evaluation date that our disclosure controls and procedures were not effective as of June 30, 2012.
 
Changes in Internal Control Over Financial Reporting

There were no significant changes in our internal controls or in other factors that could significantly affect these controls subsequent to the evaluation date. We have not identified any significant deficiencies or material weaknesses in our internal controls, and therefore there were no corrective actions taken.


PART II – OTHER INFORMATION
 

 
ITEM 1.    LEGAL PROCEEDINGS

The Company is not a party to any legal proceedings and is not aware of any pending legal proceedings as of the date of this Form 10-Q.

ITEM 1A. RISK FACTORS

The Company is a smaller reporting company and is not required to provide this information.

ITEM 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Recent Sales of Unregistered Securities:

There were no unregistered securities to report which were sold or issued by the Company without the registration of these securities under the Securities Act of 1933 in reliance on exemptions from such registration requirements, within the period covered by this report, which have not been previously included in a Quarterly Report on Form 10-Q or a Current Report on Form 8-K.

ITEM 3.    DEFAULTS UPON SENIOR SECURITIES

The Company does not have any senior securities as of the date of this Form 10-Q.

ITEM 4.   MINE SAFETY DISCLOSURES

Not Applicable


 
15

 

ITEM 5.    OTHER INFORMATION

On March 31, 2012, the Company divested its then wholly owned subsidiary AquaSil, Inc. due to the fact that the Company was unable to raise any funding as required to proceed with the development of the business, management had determined to undertake a new project and to concentrate its efforts on the development and marketing of its proprietary software EviCAT which it acquired in February, 2012.

On May 22, 2012, the shareholders holding a majority of the voting shares of the Company and the Board of Directors of the Company approved a name change of the Company from Aquasil International Inc. to Multi-Corp. International Inc and the reverse split of the current issued and outstanding shares of the Company on the basis of one (1) new share for each one-thousand (1,000) shares currently held.   The Effective Date for this action was June 22, 2012.

ITEM 6.   EXHIBITS

Exhibits:
Number
Description
 
3.1
Articles of Incorporation
Incorporated by reference to the Exhibits filed with the Form SB-2 filed with the SEC on December 15, 2007
3.1(i)
Amendment to Articles of Incorporation
Incorporated by reference to the Exhibits filed with the Form 8-K filed with the SEC on November 13, 2008
3.1(ii)
Amendment to Articles of Incorporation
Incorporated by reference to the Exhibits filed with the Form 8-K filed with the SEC on February 3, 2011
3.1(iii)
Amendment to Articles of Incorporation
Incorporated by reference to the Exhibits filed with the Form 8-K filed with the SEC on February 18, 2011
3.1(iv)
Amendment to Articles of Incorporation
Incorporated by reference to the Exhibits filed with the Form 8-K filed with the SEC on June 27, 2012
3.2
Bylaws
Incorporated by reference to the Exhibits filed with the Form SB-2 filed with the SEC on December 15, 2007
10.1
Stock Exchange Agreement between the Company, AquaSil, Inc. and Ilya Khasidov dated December 30, 2010
Incorporated by reference to the Exhibits attached to the Company's Form 8-K filed with the SEC on January 3, 2011
10.2
Acquisition Agreement between Aquasil International Inc. and Oveldi Canada Ltd.
Incorporated by reference to the Exhibits attached to the Company's Form 8-K filed with the SEC on February 2, 2012
31.1
Section 302 Certification - Principal Executive Officer
Filed herewith
31.2
Section 302 Certification - Principal Financial Officer
Filed herewith
32.1
Principal Executive Officer and Principal Financial Officer Certification  Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Filed herewith

 
16

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

     
MULTI-CORP INTERNATIONAL INC.
       
Date:
August 20, 2012
By:
/s/ Robert Baker
   
Name:
Robert Baker
   
Title:
Chief Executive Officer, President, Secretary, Treasurer, Chief Financial Officer and Director
(Principal Executive Officer and Principal Financial Officer)
       


 
17

 

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