UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
10-Q
(Mark
One)
x
|
QUARTERLY
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For
the quarterly period ended June 30, 2008
¨
|
TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For
the transition period from
to
Commission
File Number 333- 144596
MEDICAL
DESIGN STUDIOS, INC.
(Exact
Name of Registrant as Specified in Its Charter)
Nevada
|
|
26-0482524
|
(State
or Other Jurisdiction of Incorporation or Organization)
|
|
(I.R.S.
Employer Identification No.)
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7231
South Rome Street, Aurora, Colorado 80016
(Address
of Principal Executive Offices)
303-956-7197
|
(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) 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 ¨
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. (Check one):
|
Large Accelerated Filer o |
Accelerated Filer o |
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Non-accelerated Filer o |
Smaller Reporting Company x |
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes ¨ No x
As
of
August 12, 2008, 5,000,000 shares of the issuer’s Common Stock were
outstanding.
MEDICAL
DESIGN STUDIOS, INC.
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Page
Number
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PART
1 - Financial
Information
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Item
1 - Financial
Statements
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Balance
Sheets as of June 30, 2008 (Unaudited) and December 31,
2007
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1
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Statements
of Operations for the Six Months Ended June 30, 2008 and 2007
(Unaudited)
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2
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|
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Statements
of Operations for the Three Months Ended June 30, 2008 and 2007
(Unaudited)
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3
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Statements
of Cash Flows for the Six Months Ended June 30, 2008 and 2007
(Unaudited)
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4
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|
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Notes
to Unaudited Financial Statements
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5
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Item
2 - Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
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7
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Item
3 - Quantitative
and Qualitative Disclosures About Market Risk
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12
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Item
4T - Controls
and Procedures
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12
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PART
II - Other
Information
(Items 1-6)
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13
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PART
I - FINANCIAL INFORMATION
Item
1. Financial Statements
MEDICAL
DESIGN STUDIOS, INC.
Balance
Sheets
ASSETS
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|
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June
30, 2008
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December
31, 2007
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|
Current
Assets:
|
|
(Unaudited)
|
|
|
|
Cash
|
|
$
|
500
|
|
$
|
500
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|
Accounts
receivable
|
|
|
27,150
|
|
|
37,825
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|
Total
current assets
|
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|
27,650
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|
|
38,325
|
|
|
|
|
|
|
|
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Equipment:
|
|
|
|
|
|
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Computer
equipment
|
|
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29,793
|
|
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18,075
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Accumulated
depreciation
|
|
|
(9,955
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)
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|
(6,319
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)
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Net
|
|
|
19,838
|
|
|
11,756
|
|
|
|
|
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|
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TOTAL
ASSETS
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$
|
47,488
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|
$
|
50,081
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|
|
|
|
|
|
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LIABILITIES
AND STOCKHOLDERS' EQUITY
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Liabilities
|
|
|
|
|
|
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Accrued
expenses
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$
|
24,888
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|
$
|
25,086
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|
|
|
|
|
|
|
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Stockholders'
Equity:
|
|
|
|
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|
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Preferred
stock: $0.001 par value; authorized, 1,000,000 shares; no shares
issued or
outstanding
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|
|
|
|
|
-
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|
Common
stock: $0.001 par value; authorized 74,000,000 shares; 5,000,000
shares
issued and outstanding
|
|
|
5,000
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|
|
5,000
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|
Additional
paid-in capital
|
|
|
5,000
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|
|
5,000
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Retained
earnings
|
|
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12,600
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|
14,995
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Total
stockholders’ equity
|
|
|
22,600
|
|
|
24,995
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TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
$
|
47,488
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|
$
|
50,081
|
|
|
|
|
|
|
|
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|
See
accompanying notes to financial statements.
|
|
|
|
MEDICAL
DESIGN STUDIOS, INC.
Statements
of Operations
For
the
Six Months Ended June 30, 2008 and 2007
(Unaudited)
|
|
2008
|
|
2007
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
74,100
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|
$
|
138,425
|
|
|
|
|
|
|
|
|
|
Operating
Expenses:
|
|
|
|
|
|
|
|
General
and administrative
|
|
|
22,532
|
|
|
28,447
|
|
Compensation
|
|
|
53,963
|
|
|
99,205
|
|
Total
operating expenses
|
|
|
76,495
|
|
|
127,652
|
|
|
|
|
|
|
|
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Income
(loss) before income taxes
|
|
|
(2,395
|
)
|
|
10,773
|
|
|
|
|
|
|
|
|
|
Provision
for income taxes
|
|
|
-
|
|
|
2,705
|
|
|
|
|
|
|
|
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|
Net
income (loss)
|
|
$
|
(2,395
|
)
|
$
|
8,068
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|
|
|
|
|
|
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Income
(loss) per share - basic and diluted
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|
$
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(0.00
|
)
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$
|
0.00
|
|
|
|
|
|
|
|
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Weighted
average number of common shares outstanding - basic and
diluted
|
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|
5,000,000
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|
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4,710,276
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|
|
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|
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|
|
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See
accompanying notes to the financial
statements.
|
MEDICAL
DESIGN STUDIOS, INC.
Statements
of Operations
For
the
Three Months Ended June 30, 2008 and 2007
(Unaudited)
|
|
2008
|
|
2007
|
|
|
|
|
|
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|
Revenue
|
|
$
|
28,885
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$
|
83,950
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Operating
Expenses:
|
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|
|
|
|
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General
and administrative
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8,680
|
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|
15,590
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Compensation
|
|
|
15,515
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|
|
62,911
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|
Total
operating expenses
|
|
|
24,195
|
|
|
78,501
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|
|
|
|
|
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Income
before income taxes
|
|
|
4,690
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|
|
5,449
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|
|
|
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Provision
for income taxes
|
|
|
-
|
|
|
1,907
|
|
|
|
|
|
|
|
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|
Net
income
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|
$
|
4,690
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|
$
|
3,542
|
|
|
|
|
|
|
|
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Net
Income per share - basic and diluted
|
|
$
|
0.00
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|
$
|
0.00
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|
|
|
|
|
|
|
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Weighted
average number of common shares outstanding - basic and
diluted
|
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5,000,000
|
|
|
4,799,561
|
|
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|
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|
See
accompanying notes to the financial
statements.
|
MEDICAL
DESIGN STUDIOS, INC.
Statements
of Cash Flows
For
the
Six Months Ended June 30, 2008 and 2007
(Unaudited)
|
|
2008
|
|
2007
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
Net
income (loss)
|
|
$
|
(2,395
|
)
|
$
|
8,068
|
|
Depreciation
|
|
|
3,636
|
|
|
1,682
|
|
Adjustments
to reconcile net income (loss) to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
Change
in net operating assets
|
|
|
10,477
|
|
|
(10,510
|
)
|
Net
Cash Provided (Used) by Operating Activities
|
|
|
11,718
|
|
|
(760
|
)
|
|
|
|
|
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES - Purchase of computer
|
|
|
(11,718
|
)
|
|
-
|
|
|
|
|
|
|
|
|
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CASH
FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
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Sale
of common shares
|
|
|
-
|
|
|
760
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|
|
|
|
|
|
|
|
|
CHANGE
IN CASH
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
|
CASH
AT BEGINNING OF PERIOD
|
|
|
500
|
|
|
500
|
|
CASH
AT END OF PERIOD
|
|
$
|
500
|
|
$
|
500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See
accompanying notes to the financial
statements.
|
MEDICAL
DESIGN STUDIOS, INC.
Notes
to Unaudited Financial Statements
June
30, 2008 and 2007
(Unaudited)
NOTE
1 BASIS
OF PRESENTATION
The
accompanying interim financial statements for the three and six-month periods
ended June 30, 2008 and 2007 are unaudited and include all adjustments
(consisting of normal recurring adjustments) considered necessary by management
for a fair presentation. The results of operations realized during an
interim period are not necessarily indicative of results to be expected for
a
full year. These financial statements should be read in conjunction with
the information filed as part of the Company’s Annual Report on Form 10-KSB for
the year ended December 31, 2007.
The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States 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 as well as the reported amount of revenues and expenses during the
reporting period. Actual results could differ from these estimates.
NOTE
2 CURRENT
DEVELOPMENTS
On
March 14, 2008, Justin N. Craig, the Company’s President and Chief Executive
Officer, privately sold 9,140,000 shares of the Company’s common stock,
constituting 91.4% of the Company’s outstanding shares and all of the shares
owned beneficially by him, to Vision Opportunity Master Fund, Ltd. Certain
other
of the Company’s stockholders also sold shares of the Company’s common stock to
Vision Opportunity Master Fund. As a result of these privately-negotiated sales,
a change in control occurred from Mr. Craig to Vision Opportunity Master
Fund.
On
March 17, 2008, pursuant to prior approvals by stockholders owning in excess
of
a majority of the voting power of the Company’s outstanding shares, the Company
effected a 2-for-1 reverse stock split of the Company’s outstanding shares of
common stock. All
share
and per share amounts in these financial statements have been adjusted to give
retroactive effect to the reverse stock split.
Following
the reverse stock split, the Company has 5,000,000 shares of common stock
outstanding. Of such shares, after giving effect to the privately-negotiated
transactions described above, Vision Opportunity Master Fund owns 4,720,000
shares of the Company’s common stock, or 94.4% of the Company’s outstanding
shares. Vision Opportunity Master Fund purchased these shares for a total of
approximately $670,000 in cash, inclusive of related acquisition costs. The
source of the funding for the cash payment was the general working capital
of
Vision Opportunity Master Fund.
The
terms of the purchase and sale transactions were as a result of arm’s-length
negotiations between the parties. None of the parties had any relationship
with
one another prior to this transaction.
The
Company’s officers and directors, and the business focus of the Company were not
changed in connection with the purchase and sale transactions.
NOTE
3 CONCENTRATION
OF RISK
For
the
six months ended June 30, 2008, four unrelated customers (High Impact Litigation
(11.81%), The Visual Advantage (9.45%), Legal Wizard (10.66%), and Trial
Exhibits, Inc. (65.72%)) comprised 97.64% of total revenues.
For
the
six months ended June 30, 2007, four unrelated customers (High Impact Litigation
(34.51%), The Visual Advantage (20.25%), Legal Wizard (9.29%) and Trial
Exhibits, Inc. (21.40%)) comprised 85.45% of total revenues.
ITEM
2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
Safe
Harbor Statement under the Private Securities Litigation Reform Act of
1995
Information
set forth herein contains "forward-looking statements" which can be identified
by the use of forward-looking terminology such as "believes," "expects," "may,”
“should" or "anticipates" or the negative thereof or other variations thereon
or
comparable terminology, or by discussions of strategy. We cannot assure you
that
the future results covered by the forward-looking statements will be achieved.
We caution readers that important factors may affect our actual results and
could cause such results to differ materially from forward-looking statements
made by or on behalf of us. These factors include our lack of historically
profitable operations, dependence on key personnel, the success of our business,
ability to manage anticipated growth and other factors identified in our filings
with the Securities and Exchange Commission, press releases and/or other public
communications.
The
following discussion and analysis provides information which our management
believes to be relevant to an assessment and understanding of the our results
of
operations and financial condition. This discussion should be read together
with
our financial statements and the notes to financial statements, which are
included in this report. Because of the nature of a relatively new and growing
company such as ours, the reported results will not necessarily reflect the
future.
Operations
We
were
founded as an unincorporated business in January 2004 and became a C corporation
in the state of Nevada on February 1, 2005. At June 30, 2008, we had one
employee, Justin Craig, our founder and president. Mr. Craig devotes his full
time to us.
We
are a
digital medical illustrator and animator providing digital displays and
enhancements to companies that assist attorneys to prepare or enhance exhibits
for trials involving medical issues. Approximately 85% of our work is ultimately
used by plaintiff counsel and 15% is used by defense counsel.
Our
customers are almost always companies that assist attorneys to prepare or
enhance a wide range of exhibits for trials. We perform the digital medical
imaging that is needed by these companies. There are a limited number of these
companies.
Customers
originally hear of our services from word of mouth. Generally, they continue
with us and expand or decrease the amount of work that they send to us based
on
the quality and timing of our output. We retain rights to the digital images
that we produce. These digital images form a library for us. We can sell some
of
these digital images to users who need generic types of images for their
purposes. This enables us to generate revenue without doing additional work.
The
longer that we are in operation, the larger our library becomes.
Comparison
of the six months ended June 30, 2008 and 2007
A
summary
of operations follows:
|
|
2008
|
|
2007
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
74,100
|
|
$
|
138,425
|
|
|
|
|
|
|
|
|
|
Operating
Expenses:
|
|
|
|
|
|
|
|
General
and administrative
|
|
|
22,532
|
|
|
28,447
|
|
Compensation
|
|
|
53,963
|
|
|
99,205
|
|
Total
operating expenses
|
|
|
76,495
|
|
|
127,652
|
|
|
|
|
|
|
|
|
|
Income
(loss) before income taxes
|
|
|
(2,395
|
)
|
|
10,773
|
|
|
|
|
|
|
|
|
|
Provision
for income taxes
|
|
|
-
|
|
|
2,705
|
|
|
|
|
|
|
|
|
|
Net
income (loss)
|
|
$
|
(2,395
|
)
|
$
|
8,068
|
|
Revenue
- For
the six months ended June 30, 2008, four unrelated customers (High Impact
Litigation (11.81%), The Visual Advantage (9.45%), Legal Wizard (10.66%), and
Trial Exhibits, Inc. (65.72%)) comprised 97.64% of total revenues.
For
the
six months ended June 30, 2007, four unrelated customers (High Impact Litigation
(34.51%), The Visual Advantage (20.25%), Legal Wizard (9.29%) and Trial
Exhibits, Inc. (21.40%)) comprised 85.45% of total revenues.
Compensation
relates
entirely to Justin Craig.
General
and administrative consist
of:
|
|
2008
|
|
2007
|
|
|
|
|
|
|
|
Automobile
|
|
$
|
467
|
|
$
|
973
|
|
Computer
supplies
|
|
|
942
|
|
|
885
|
|
Depreciation
|
|
|
3,636
|
|
|
1,682
|
|
Dues
|
|
|
104
|
|
|
395
|
|
Employee
benefits
|
|
|
5,294
|
|
|
9,144
|
|
Entertainment
|
|
|
463
|
|
|
468
|
|
Internet
expenses
|
|
|
130
|
|
|
556
|
|
Office
expense
|
|
|
2,000
|
|
|
1,175
|
|
Outside
services
|
|
|
5,474
|
|
|
7,201
|
|
Rent
|
|
|
1,200
|
|
|
2,400
|
|
Repairs
and maintenance
|
|
|
916
|
|
|
312
|
|
Salaries
|
|
|
600
|
|
|
1,400
|
|
Taxes
|
|
|
46
|
|
|
46
|
|
Telephone
|
|
|
436
|
|
|
723
|
|
Travel
|
|
|
824
|
|
|
1,087
|
|
Total
|
|
$
|
22,532
|
|
$
|
28,447
|
|
Other
As
a
corporate policy, we
will
not incur any cash obligations that we cannot satisfy with known resources,
of
which there are currently none except as described in “Liquidity” below. We
believe that the perception that many people have of a public company make
it
more likely that they will accept restricted securities from a public company
as
consideration for indebtedness to them than they would from a private company.
We have not performed any studies of this matter. Our conclusion is based on
our
own observations. However, we cannot assure you that we will be successful
in
any of those efforts even as a public entity. Additionally, issuance of
restricted shares would necessarily dilute the percentage of ownership interest
of our stockholders.
Liquidity
We
do not
know and cannot estimate whether the transaction among certain of our
stockholders and Vision Opportunity Master Fund described above will have any
impact on our liquidity or ability to obtain funds.
Private
capital, if sought, will be sought from former business associates of our
founder or private investors referred to us by those business associates. To
date, we have not sought any funding source and have not authorized any person
or entity to seek out funding on our behalf. If a market for our shares ever
develops, of which we cannot assure you, we may use restricted shares of our
common stock to compensate employees/consultants and independent contractors
wherever possible. We believe that operations are generating sufficient
cash to continue operations for the next 12 months provided that our costs
of
being a public company remain equal to or below the maximum estimate provided
below.
In
becoming a public company, we have incurred and will continue to incur
additional significant expenses for legal, accounting and related services.
As a
public entity, subject to the reporting requirements of the Securities Exchange
Act of 1934, we incur ongoing expenses associated with professional fees for
accounting, legal and a host of other expenses for annual reports and proxy
statements. We estimate that these costs will range up to $50,000 per year
for
the next few years and will be higher if our business volume and activity
increases but lower during the first year of being public because our overall
business volume will be lower, and we will not yet be subject to the
requirements of Section 404 of the Sarbanes-Oxley Act of 2002. These
obligations will reduce our ability and resources to fund other aspects of
our
business. We hope to be able to use our status as a public company to increase
our ability to use noncash means of settling obligations and compensate
independent contractors who provide professional services to us, although we
cannot assure you that we will be successful in any of those efforts. We will
reduce the compensation levels paid to management if there is insufficient
cash
generated from operations to satisfy these costs.
There
are
no current plans to seek private investment. We do not have any current
plans to raise funds through the sale of securities. As previously stated,
we hope to be able to use our status as a public company to enable us to use
non-cash means of settling obligations and compensate persons and/or firms
providing services or products to us, although we cannot assure you that we
will
be successful in any of those efforts. We believe that the perception that
many people have of a public company makes it more likely that they will accept
restricted securities from a public company as consideration for indebtedness
to
them than they would from a private company. We have not performed any
studies of this matter. Our conclusion is based on our own beliefs.
Issuing shares of our common stock to such persons instead of paying cash to
them would increase our chances to expand our business. Having shares of
our common stock may also give such persons a greater feeling of identity with
us which may result in referrals. However, these actions, if successful,
will result in dilution of the ownership interests of existing stockholders,
may
further dilute common stock book value, and that dilution may be material.
Such
issuances may also serve to enhance our existing management’s ability to
maintain control of our company because the shares may be issued to parties
or
entities committed to supporting existing management.
Off
Balance Sheet Arrangements
We
have
no off balance sheet arrangements as
defined in Item 303(a)(4)(ii) of Regulation S-K,
obligations under any guarantee contracts or contingent obligations. We also
have no other commitments, other than the costs of being a public company,
that
will increase our operating costs or cash requirements in the
future.
Seasonality
We
have
not noted a significant seasonal impact in our business.
Recent
Accounting Pronouncements
In
September 2006, the Financial Accounting Standards Board (“FASB”) issued
Statement of Financial Accounting Standards (“SFAS”) No. 157, “Fair Value
Measurements” (“SFAS 157”). SFAS 157 defines fair value as used in numerous
accounting pronouncements, establishes a framework for measuring fair value
in
generally accepted accounting principles and expands disclosure related to
the
use of fair value measures in financial statements. SFAS 157 is effective as
of
the beginning of the first fiscal year beginning after November 15,
2007. Effective January 1, 2008, we adopted SFAS 157 for financial assets
and liabilities recognized at fair value on a recurring basis. The partial
adoption of SFAS 157 for financial assets and liabilities did not have a
material impact on our financial position or results of operations.
On
February 15, 2007, the FASB issued SFAS
No.
159, “The
Fair Value Option for Financial Assets and Financial Liabilities: Including
an
amendment of FASB Statement No. 115” (“SFAS 159”). SFAS 159 permits all entities
to elect to measure many financial instruments and certain other items at fair
value with changes in fair value reported in earnings. SFAS 159 is effective
as
of the beginning of the first fiscal year that begins after November 15, 2007,
with earlier adoption permitted.
Effective January 1, 2008, we adopted SFAS 159. The adoption of SFAS 159 did
not
have a material impact on our financial position or results of
operations.
In
June 2007, the Emerging Issues Task Force (“EITF”) of the FASB issued EITF Issue
No. 07-3, “Accounting for Nonrefundable Advance Payments for Goods or Services
to be Used in Future Research and Development Activities” (“EITF Issue No.
07-3”), which is effective for fiscal years beginning after December 15,
2007. EITF Issue No. 07-3 requires that nonrefundable advance
payments for future research and development activities be deferred and
capitalized. Such amounts will be recognized as an expense as the
goods are delivered or the related services are performed. The
adoption of EITF Issue No. 07-3 did not have a material impact on our financial
results .
In
December 2007, the FASB issued SFAS
No. 141 (Revised 2007), “Business Combinations” (“SFAS 141(R)”), which requires
us to record fair value estimates of contingent consideration and certain other
potential liabilities during the original purchase price allocation, expense
acquisition costs as incurred and does not permit certain restructuring
activities previously allowed under EITF Issue No. 95-3 to be recorded as a
component of purchase accounting. SFAS 141(R) applies prospectively
to business combinations for which the acquisition date is on or after the
beginning of the first annual reporting period beginning on or after December
15, 2008, except
for the presentation and disclosure requirements, which shall be applied
retrospectively for all periods presented. We will adopt this standard at the
beginning of our 2009 fiscal year for all prospective business acquisitions.
We
have not determined the effect that the adoption of SFAS 141(R) will have on
our
financial statements.
In
December 2007, the FASB issued SFAS
No. 160, “Noncontrolling
Interests in Consolidated Financial Statements - an amendment of ARB No. 51”
(“SFAS 160”), which causes noncontrolling interests in subsidiaries to be
included in the equity section of the balance sheet. SFAS 160 applies
prospectively to business combinations for which the acquisition date is on
or
after the beginning of the first annual reporting period beginning on or after
December 15, 2008, except
for the presentation and disclosure requirements, which shall be applied
retrospectively for all periods presented. We will adopt this standard at the
beginning of our 2009 fiscal year for all prospective business
acquisitions. We have not determined the effect that the adoption of
SFAS 160 will have on our financial statements.
In
March 2008, the FASB issued SFAS
No. 161, “Disclosures about Derivative Instruments and Hedging Activities an
amendment of FASB Statement No. 133” (“SFAS 161”), which changes the disclosure
requirements for derivative instruments and hedging activities. Pursuant to
SFAS
161, entities are required to provide enhanced disclosures about (a) how and
why
an entity uses derivative instruments, (b) how derivative instruments and
related hedged items are accounted for under SFAS No. 133 and its related
interpretations, and (c) how derivative instruments and related hedged items
affect an entity’s financial position, financial performance, and cash
flows. SFAS 161 is effective for financial statements issued for
fiscal years and interim periods beginning after November 15, 2008 with early
application encouraged. SFAS 161 encourages but does not require disclosures
for
earlier periods presented for comparative purposes at initial adoption. In
years
after initial adoption, SFAS 161 requires comparative disclosures only for
periods subsequent to initial adoption. We will adopt this standard at the
beginning of our 2009 fiscal year. We do not expect the adoption of
SFAS 161 to have a material impact on our financial results.
The
FASB,
the EITF and the U.S. Securities and Exchange Commission have issued certain
other accounting pronouncements and regulations as of June 30, 2008 that will
become effective in subsequent periods; however, our management does not believe
that any of those pronouncements would have significantly affected our
financial accounting measurements or disclosures had they been in effect during
the three and six months ended June 30, 2008 and 2007, and it does not believe
that any of those pronouncements will have a significant impact on our
financial statements at the time they become effective.
Critical
Accounting Policies
The
preparation of financial statements and related notes requires us to make
judgments, estimates, and assumptions that affect the reported amounts of
assets, liabilities, revenue and expenses, and related disclosure of contingent
assets and liabilities.
An
accounting policy is considered to be critical if it requires an accounting
estimate to be made based on assumptions about matters that are highly uncertain
at the time the estimate is made, and if different estimates that reasonably
could have been used, or changes in the accounting estimates that are reasonably
likely to occur periodically, could materially impact the financial statements.
Financial
Reporting Release No. 60 requires all companies to include a discussion of
critical accounting policies or methods used in the preparation of financial
statements. There are no critical policies or decisions that rely on
judgments that are based on assumptions about matters that are highly uncertain
at the time the estimate is made.
ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
Not
required.
ITEM
4T. CONTROLS AND PROCEDURES
(a)
Evaluation of Disclosure Controls and Procedures.
An
evaluation was carried out under the supervision and with the participation
of
the our management, including our Chief Executive Officer ("CEO") and Chief
Financial Officer ("CFO") (in this case the same person), of the effectiveness
of our disclosure controls and procedures as of June 30, 2008. Based on that
evaluation, our CEO/CFO has concluded that our disclosure controls and
procedures are effective to provide reasonable assurance that: (i) information
required to be disclosed by us in reports that we file or submit under the
Securities Exchange Act of 1934 is accumulated and communicated to our
management, including our CEO/CFO, as appropriate to allow timely decisions
regarding required disclosure by us; and (ii) information required to be
disclosed by us in reports that we file or submit under the Securities Exchange
Act of 1934 is recorded, processed, summarized and reported within the time
periods specified in Securities and Exchange Commission rules and
forms.
(b)
Changes
in Internal Controls.
During
the quarter ended June 30, 2008, there were no changes in our internal control
over financial reporting that have materially affected, or are reasonably likely
to materially affect, our internal control over financial
reporting.
PART
II - OTHER INFORMATION
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ITEM
1.
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LEGAL
PROCEEDINGS
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None.
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ITEM
1A.
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RISK
FACTORS
|
|
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Not
required
|
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ITEM
2.
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UNREGISTERED
SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
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None.
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ITEM
3.
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DEFAULTS
UPON SENIOR SECURITIES
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None.
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ITEM
4.
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SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS
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None.
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ITEM
5.
|
OTHER
INFORMATION
|
|
|
|
|
None.
|
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ITEM
6.
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EXHIBITS
|
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Exhibit
Number
|
|
Description
|
31.1
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Section
302 Certification Of Chief Executive Officer And Chief Financial
Officer
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32.1
|
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Certification
Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section
906 Of
The Sarbanes-Oxley Act Of 2002 - Chief Executive Officer And Chief
Financial Officer
|
Pursuant
to the requirements of the Securities and Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
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Medical
Design Studios, Inc. |
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By: |
/s/ Justin
Craig |
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Justin
Craig |
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President
and
Chief Financial Officer
(principal
executive officer; principal
financial
and accounting officer)
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Dated: August 13, 2008 |