Business context and reporting period
Filing identity discrepancy: The request identifies Creative Medical Technology Holdings, Inc., but the supplied 10-Q is for Jolley Marketing, Inc. This summary reflects the filing text. It reports the unaudited quarter ended March 31, 2015.
Jolley Marketing describes itself as a shell company with no revenue since September 2008. It intends to seek a business acquisition or combination, but had identified no target or entered acquisition negotiations. It had no employees; its sole officer and director provided services without cash compensation.
Financial results and liquidity
| Metric | Q1 2015 | Q1 2014 |
|---|---|---|
| Revenue | $0 | $0 |
| Operating expenses, excluding separately presented interest | $6,992 | $8,039 |
| Related-party interest expense | $2,280 | $1,976 |
| Net loss | $9,272 | $10,015 |
| Basic and diluted loss per share | $0.00 | $0.00 |
| Operating cash used | $5,371 | $4,085 |
| Financing cash provided | $5,000 | $5,000 |
At March 31, 2015, cash was $583, down from $954 at December 31, 2014. Current liabilities were $162,898, versus current assets of $583, leaving a working-capital deficit of $162,315. Liabilities included $12,507 of accounts payable and $150,391 of related-party notes and accrued interest. Stockholders’ deficit was $162,315. No revenue-generating operations were reported, so revenue margins are not meaningful.
The filing reports no line of credit or capital-expenditure commitments. It estimates ongoing public-company expenses of approximately $30,000 annually. The company issued an $8,000 demand note to a related party during the quarter, bearing 8% annual interest, and repaid $3,000 on another related-party note.
Changes, outlook, risks, and unusual items
- Net loss improved by $743 from Q1 2014, as professional fees declined; higher related-party interest expense partly offset the decrease.
- Operating cash use increased by $1,286 year over year. The company reported $5,000 of net financing cash in both periods.
- Management anticipated receiving related-party advances to fund needs for the next 12 months, but gave no assurance. It may seek additional loans, equity sales, or other financing.
- The filing states that losses, negative operating cash flow, liabilities exceeding assets, and absence of revenue raise substantial doubt about the company’s ability to continue as a going concern. Management’s proposed funding and acquisition plans are uncertain; the financial statements include no adjustments for these uncertainties.
- Management concluded disclosure controls and procedures were not effective as of quarter-end. It reported no material changes in internal control over financial reporting during the quarter.
- The company reported no subsequent events requiring disclosure. The statements are unaudited and include condensed disclosures.
Important facts for investors to verify
- Whether this filing belongs to the company named in the request: the filing names Jolley Marketing, Inc., not Creative Medical Technology Holdings, Inc.
- Availability and terms of further related-party financing, including demand repayment obligations and accrued interest.
- Whether the company can fund its estimated ongoing expenses and address the substantial going-concern uncertainty.
- Whether any acquisition opportunity emerges and what financing or dilution it could require.
- The effectiveness of disclosure controls and any subsequent remediation.