UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





Form 10-K





x
ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934





For the fiscal year ended December 31, 2010





OR





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





For the transition period from_____________ to _____________.





Commission file number 000-49933





POLLEX, INC.


(Exact name of registrant as specified in its charter)





Nevada

(State or other jurisdiction of

incorporation or organization)
95-4886472

(I.R.S. Employer

Identification No.)2005 De La Cruz Blvd. Suite 235

Santa Clara, CA

(Address of principal executive offices)
95050

(Zip Code)





Registrant’s telephone number, including area code (408) 970-8050





Securities registered pursuant to Section 12(b) of the Act:





Title of each class

Name of each exchange on which registeredNone

None





Securities registered pursuant to Section 12(g) of the Act:





Common Stock, par value $0.001


(Title of class)





Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No x





Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. 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 (§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.





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 o





1





Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o





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 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 oNon-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 Act). Yes o   No x





Aggregate market value of the voting stock held by non-affiliates: $25,767 as of the Registrant's most recently completed second fiscal quarter. The voting stock held by non-affiliates on that date consisted of 1,288,355 shares of common stock.





Applicable Only to Registrants Involved in Bankruptcy Proceedings During the Preceding Five Years:





Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act of 1934 subsequent to 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 registrant’s classes of common stock, as of the latest practicable date. As of March 30, 2011, there were 5,121,689 shares of common stock, par value $0.001, issued and outstanding.





Documents Incorporated by Reference





List hereunder the following documents if incorporated by reference and the Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) Any annual report to security holders; (2) Any proxy or information statement; and (3) Any prospectus filed pursuant to rule 424(b) or (c) of the Securities Act of 1933. The listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended December 24, 1980). None.




2


Pollex, Inc.





TABLE OF CONTENTS





PagesPART IITEM 1 - BUSINESS
4ITEM 1A - RISK FACTORS
5ITEM 1B - UNRESOLVED STAFF COMMENTS
8ITEM 2 - PROPERTIES
9ITEM 3 - LEGAL PROCEEDINGS
9ITEM 4 - RESERVEDPART II9ITEM 5 - MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
9ITEM 6 - SELECTED FINANCIAL DATA
10ITEM 7 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION
13ITEM 7A - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
F-1ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
15ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
15ITEM 9A - CONTROLS AND PROCEDURES
15ITEM 9A(T) - CONTROLS AND PROCEDURES
15ITEM 9B - OTHER INFORMATION
15PART IIIITEM 10 - DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNACE
16ITEM 11 - EXECUTIVE COMPENSATION
18ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AN D RELATED STOCKHOLDER MATTERS
21ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
21ITEM 14 - PRINCIPAL ACCOUNTING FEES AND SERVICES
21PART IVITEM 15 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES
22




3


PART I








This Annual Report includes forward-looking statements within the meaning of the Securities Exchange Act of 1934 (the “Exchange Act”). These statements are based on management’s beliefs and assumptions, and on information currently available to management. Forward-looking statements include the information concerning possible or assumed future results of operations of the Company set forth under the heading “Management's Discussion and Analysis of Financial Condition or Plan of Operation.” Forward-looking statements also include statements in which words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “consider” or similar expressions are used.





Forward-looking statements are not guarantees of future performance. They involve risks, uncertainties and assumptions. The Company's future results and shareholder values may differ materially from those expressed in these forward-looking statements. Readers are cautioned not to put undue reliance on any forward-looking statements.





ITEM 1 – BUSINESS





Business Overview





Overview





Pollex, Inc., formerly Joytoto USA, Inc., formerly BioStem, Inc. (the “Company,” “we,” and “us”) was incorporated on November 2, 2001, in the State of Nevada, as Web Views Corporation.





We are a majority owned subsidiary of Joytoto Co., Ltd. (“Joytoto Korea”). We had one wholly-owned subsidiary, Joyon Entertainment, Inc. (“JEI”), and had two sub-subsidiaries, Joytoto Technologies, Inc., a Nevada corporation (“JTI”) and Joytoto America, Inc., a California corporation (“JAI”), both of which were wholly-owned subsidiaries of JEI.   Effective June 30, 2010, we, along with JEI, sold 100% of the issued and outstanding common stock of JAI to Joytoto Korea in exchange for the return and cancellation to us of 166,667 shares of our common stock held by Joytoto Korea.  Effective August 6, 2010, JEI was dissolved. The Company is determined to focus on its Online Games business by acquiring new game licenses to provide commercial service of such games in South Korea and the United States.





Our operations were originally organized into two business segments: Consumer Electronics and Online Games. On June 24, 2010, we dissolved JTI due to inactivity of the distributor contracts and lack of revenues generated in the Consumer Electronics business segment of the Company. The Company will focus on its Online Games segment.





Products and Services





Our operations are focused on Online Games. The Company has acquired licenses from various online game developers to use in South Korea. Our Online Games business segment has generated $57,340 as of December 31, 2010 while in its open beta testing..





The major online game business that is held is The Great Merchant. The online game is operating at its website http://www.thegreatmerchant.com. The website operated in open beta testing on January 2010. The game will be opened for full commercial service in the 2nd Quarter of 2011.





Online Games





As of December 31, 2010, the Company has acquired license agreements for 16 games for use in South Korea. These agreements allow the Company to release and service these games in South Korea. The Company will be launching three of these games commercially in South Korea beginning 2nd Quarter of 2011. The rest of the games will be launched in consecutive succession soon afterward in each Quarter following.  For each of the game licenses, the Company was required to pay license  fees of $120,500, ranging from zero to $30,000 per game.  On two  games, the Company was required to prepay $30,000 in non-refundabledeposits which can be used for future commission payments.  On one  game, the Company was required to make a $5,000 non-refundable  deposit.  In total, the Company has paid $73,750 of these amounts and is required to make additional payments  of $81,750.  When these games are commercial operating, the Companywill be required to split the revenue with the licensors. The Great Merchant is an economic based MMORPG(massively multiplayer online role playing game) online at http://www.thegreatmerchant.com.  While the game is free to play and there is no cost for users to purchase and connect to the game, the game adequately engages the user to use micro transactions to purchase in-game points that can be used in the game to further the in-game operations of their own character.Unlike different MMORPGs on the market, the Great Merchant player can advance through the game by trading online items and virtual goods.




Customer Service
  We focus on retention of our current subscribers and believe our ability to establish and maintain long-term relationships with subscribers depends, in part, on the strength of our customer support and service operations. We utilize frequent communication and feedback from our subscribers to continually improve our website and our service. Our subscribers can communicate with our customer service representatives by email. We focus on eliminating the causes of customer support calls by automating certain self-service features on our website.
 
 Marketing and Advertising
 
 Our sales and marketing efforts are designed to attract visitors to our website and convert and retain them as paying subscribers in a cost effective manner. We will employ a multi-channel customer acquisition strategy and market and advertise to potential subscribers through a combination of paid and unpaid sources. We believe that our paid marketing efforts are significantly enhanced by the benefits of word-of-mouth advertising and referrals by existing subscribers. We regularly monitor the effectiveness of our marketing efforts primarily by conducting surveys during our registration process. We use the survey results to actively manage our online and offline media and channel mix in order to improve the efficiency of our marketing expenditures.
  We are currently pursuing the following customer acquisition activities:
  Online advertising.    We will advertise online through search engines, advertising networks and partner websites. We use a pay-per-click spending model on search engines and pay-per-conversion model on our various online advertising, affiliate and partner networks, in order to match our costs with new customer additions.
  Word-of-mouth referrals.    We believe that we have developed a loyal customer base, and new customers frequently indicate they have heard about us from current customer.


Competition





Our business is extremely competitive, particularly with respect to the online gaming marketplace. In addition, the market for the products we develop is subject to rapid technological change. We intend to compete with numerous online gaming companies, many of which have significantly greater financial, technical, and marketing resources than we do.




4





Research and Development





We have not expended funds for research and development costs since inception.





Reports to Security Holders





We will file the necessary reports with the SEC pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including but not limited to, current reports on Form 8-K, annual reports on Form 10-K, and quarterly reports on Form 10-Q. You may read and copy these reports, statements or other information filed by us in the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the Public Reference Room. Our SEC filings are also available to the public at the Website maintained by the SEC at www.sec.gov.





Employees





We have three employees, all of which are full time.




ITEM 1A - RISK FACTORS





As a smaller reporting company we are not required to provide a statement of risk factors. However, since our operations are fairly new to us we believe this information may be valuable to our shareholders for this filing. We reserve the right to not provide risk factors in our future filings. Our primary risk factors and other considerations include:





We have a limited operating history and limited historical financial information upon which you may evaluate our performance.





We are in our early stages of development and face risks associated with a new company in a growth industry. We may not successfully address these risks and uncertainties or successfully implement our operating strategies. If we fail to do so, it could materially harm our business to the point of having to cease operations and could impair the value of our common stock to the point investors may lose their entire investment. Even if we accomplish these objectives, we may not generate positive cash flows or the profits we anticipate in the future.





We operate in a competitive industry and continue to be under the pressure of eroding gross profit margins, which could have a material adverse effect on our business.





The market for the products we intend to develop is very competitive and subject to rapid technological change. The prices for our intended products tend to decrease over their life cycle, which can result in decreased gross profit margins for us. There is also substantial and continuing pressure from customers to reduce their total cost for products. We expend substantial amounts on the value creation services required to remain competitive, retain existing business, and gain new customers, and we must evaluate the expense of those efforts against the impact of price and margin reductions. Further, our margins will be lower in certain geographic markets and certain parts of our business than in others. For example, the products we intend to sell in the Asian markets tend to have lower profit margins than in the United States. If we are unable to effectively compete in our industry or are unable to maintain acceptable gross profit margins, our business could be materially adversely affected.





Products developed by us may be found to be defective and, as a result, warranty and/or product liability claims may be asserted against us, which may have a material adverse effect on the company.





We may face claims for damages as a result of defects or failures in the products we intend to develop, or which Joytoto Korea has developed for value-added resellers. Our ability to avoid liabilities, including consequential damages, may be limited as a result of differing factors, such as the inability to exclude such damages due to the laws of some of the countries where we do business. Our business could be materially adversely affected as a result of a significant quality or performance issue in the products developed by us, if we are required to pay for the damages that result.





Our share ownership is concentrated.





Joytoto Co. Ltd., a Korean company, beneficially owns approximately 42.3% of our voting shares (including shares owned by its wholly-owned subsidiary, Joyon Entertainment Co., Ltd.). As a result, this stockholder can exert significant influence over all matters requiring stockholder approval, including the election and removal of directors, any merger, consolidation or sale of all or substantially all of assets, as well as any charter amendment and other matters requiring stockholder approval. In addition, this stockholder may dictate the day to day management of the business. This concentration of ownership may delay or prevent a change in control and may have a negative impact on the market price of our common stock by discouraging third party investors. In addition, the interests of this stockholder may not always coincide with the interests of our other stockholders.




5





Our non-U.S. locations may represent a significant portion of our sales, and consequently, we may be exposed to risks associated with operating internationally.





As a result of our intended foreign sales and locations, and our relationships with foreign suppliers and potential foreign customers, our operations may be subject to a variety of risks that are specific to international operations, including the following:





·
import and export regulations that could erode profit margins or restrict exports;·
the burden and cost of compliance with foreign laws, treaties, and technical standards and changes in those regulations;·
potential restrictions on transfers of funds;·
foreign currency fluctuations;·
import and export duties and value-added taxes;·
transportation delays and interruptions;·
uncertainties arising from local business practices and cultural considerations; and·
potential military conflicts and political risks.





While we intend to adopt measures to reduce the potential impact of losses resulting from the risks of doing business abroad, we cannot ensure that such measures will be adequate.





When we make acquisitions, we may not be able to successfully integrate them or attain the anticipated benefits.





We intend to acquire other businesses that are synergistic with ours. If we are unsuccessful in integrating our acquisitions, or if integration is more difficult than anticipated, we may experience disruptions that could have a material adverse effect on our business. In addition, we may not realize all of the anticipated benefits from our acquisitions, which could result in an impairment of goodwill or other intangible assets.





We lack proper internal controls and procedures.


We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive and Financial Officer, as appropriate, to allow timely decisions regarding required disclosure based on the definition of “disclosure controls and procedures” in Rule 13a-15(e). In designing and evaluating the disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
  During the course of the preparation of our December 31, 2010 financial statements, we identified certain material weaknesses relating to our internal controls and procedures. Some of these internal control deficiencies may also constitute deficiencies in our disclosure and internal controls.
 Our business may require additional capital for continued growth, and our growth may be slowed if we do not have sufficient capital.




The continued growth and operation of our business may require additional funding for working capital.  We may be unable to secure such funding when needed in adequate amounts or on acceptable terms, if at all. To execute our business strategy, we may issue additional equity securities in public or private offerings, potentially at a price lower than the market price at the time of such issuance. Similarly, we may seek debt financing and may be forced to incur significant interest expense. If we cannot secure sufficient funding, we may be forced to forego strategic opportunities or delay, scale back or eliminate operations, acquisitions, and other investments.




Our ability to obtain needed financing may be impaired by such factors as the condition of the economy and capital markets, both generally and specifically in our industry, and the fact that we are not profitable, which could impact the availability or cost of future financings. If the amount of capital we are able to raise from financing activities, together with our revenues from operations, is not sufficient to satisfy our capital needs, even to the extent that we reduce our operations accordingly, we may be required to cease operations.




6




Our inability to use shares of our common stock to finance future acquisitions could impair the growth and expansion of our business.




The extent to which we will be able or willing to use shares of our common stock to consummate acquisitions will depend on (i) the market value of our securities which will vary, (ii) liquidity, which is presently limited, and (iii) the willingness of potential sellers to accept shares of our common stock as full or partial payment for their business. Using shares of our common stock for this purpose may result in significant dilution to existing stockholders. To the extent that we are unable to use common stock to make future acquisitions, our ability to grow through acquisitions may be limited by the extent to which we are able to raise capital through debt or equity financings. We may not be able to obtain the necessary capital to finance any acquisitions. If we are unable to obtain additional capital on acceptable terms, we may be required to reduce the scope of expansion or redirect resources committed to internal purposes. Our failure to use shares of our common stock to make future acquisitions may hinder our ability to actively pursue our acquisition program.




We are subject to financial reporting and other requirements for which our accounting, and other management systems and resources may not be adequately prepared.




We are subject to reporting and other obligations under the Exchange Act, including the requirements of Section 404 of the Sarbanes-Oxley Act. Section 404 requires us to conduct an annual management assessment of the effectiveness of our internal controls over financial reporting. These reporting and other obligations will place significant demands on our management, administrative, operational and accounting resources. We anticipate that we may need to (i) upgrade our systems, (ii) implement additional financial and management controls, reporting systems and procedures, (iii) implement an internal audit function, and (iv) hire additional accounting, internal audit and finance personnel. If we are unable to accomplish these objectives in a timely and effective manner, our ability to comply with our financial reporting requirements and other rules that apply to reporting companies could be impaired. Any failure to maintain effective internal controls could have a negative impact on our ability to manage our business and on our stock price.




Public company compliance may make it more difficult to attract and retain officers and directors.




The Sarbanes-Oxley Act and rules implemented by the SEC have required changes in corporate governance practices of public companies. As a public company, we expect these rules and regulations to increase our compliance costs in 2011 and beyond and to make certain activities more time consuming and costly. As a public company, we also expect that these rules and regulations may make it more difficult and expensive for us to obtain director and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our board of directors or as executive officers, and to maintain insurance at reasonable rates, or at all.




Our common stock may be affected by limited trading volume and may fluctuate significantly.





There has been a limited public market for our common stock and there can be no assurance an active trading market for our common stock will develop. This could adversely affect our shareholders’ ability to sell our common stock in short time periods or possibly at all. Our common stock has experienced and is likely to experience significant price and volume fluctuations that could adversely affect the market price of our common stock without regard to our operating performance. Our stock price could fluctuate significantly in the future based upon any number of factors such as: general stock market trends; announcements of developments related to our business; fluctuations in our operating results; announcements of technological innovations, new products or enhancements by us or our competitors; general conditions in the markets we serve; general conditions in the U.S. economy; developments in patents or other intellectual property rights; the performance of our eligible portfolio companies; and developments in our relationships with our customers and suppliers. Substantial fluctuations in our stock price could significantly reduce the price of our stock.





Our common stock is traded on the "Over-the-Counter Bulletin Board," which may make it more difficult for investors to resell their shares due to suitability requirements.





Our common stock is currently traded on the Over the Counter Bulletin Board (OTCBB) where we expect it to remain in the foreseeable future. Broker-dealers often decline to trade in OTCBB stocks given the market for such securities are often limited, the stocks are more volatile, and the risk to investors is greater. These factors may reduce the potential market for our common stock by reducing the number of potential investors. This may make it more difficult for investors in our common stock to sell shares to third parties or to otherwise dispose of their shares. This could cause our stock price to decline.





There is substantial doubt about our ability to continue as a going concern.





Our independent registered public accounting firm has issued an opinion on our consolidated financial statements that states that the consolidated financial statements were prepared assuming we will continue as a going concern and further states that our net losses of $20,796,826 and $30,440,852 in 2010 and 2009 and accumulated deficit of $138,361,213 at December 31, 2010 raise substantial doubt about our ability to continue as a going concern. Our plans concerning these matters include raising capital through the equity markets to fund future operations and generating revenue through our license agreements.  Additionally, even we do raise sufficient capital to support our operating expenses and generate adequate revenues, there can be no assurances that the revenue will be sufficient to enable us to develop business to a level where it will generate profits and cash flows from operations.




7





Our stock price may be volatile.




The market price of our common stock is likely to be highly volatile and could fluctuate widely in price in response to various factors, many of which are beyond our control, including the following:




•

changes in our industry;•

competitive pricing pressures;•

our ability to obtain working capital financing;•

additions or departures of key personnel;•

sales of our common stock;•

our ability to execute our business plan;•

operating results that fall below expectations;•

loss of any strategic relationship;•

regulatory developments; and•

economic and other external factors.





In addition, the securities markets have from time to time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies. These market fluctuations may also materially and adversely affect the market price of our common stock.




We have not paid cash dividends in the past and do not expect to pay cash dividends in the future. Any return on an investment in our common stock may be limited to the value of the common stock.




We have never paid cash dividends on our common stock and do not anticipate doing so in the foreseeable future. The payment of dividends on our common stock will depend on our earnings, financial condition, and other business and economic factors as our board of directors may consider relevant. If we do not pay dividends, our common stock may be less valuable because a return on a shareholder’s investment will only occur if our stock price appreciates.




Our common stock may be deemed a “penny stock,” which would make it more difficult for our investors to sell their shares.




Our common stock may be subject to the “penny stock” rules adopted under Section 15(g) of the Exchange Act. The penny stock rules generally apply to companies whose common stock is not listed on The NASDAQ Stock Market or other national securities exchange and trades at less than $4.00 per share, other than companies that have had average revenue of at least $6,000,000 for the last three years or that have tangible net worth of at least $5,000,000 ($2,000,000 if the company has been operating for three or more years). These rules require, among other things, that brokers who trade penny stock to persons other than “established customers” complete certain documentation, make suitability inquiries of investors and provide investors with certain information concerning trading in the security, including a risk disclosure document and quote information under certain circumstances. Many brokers have decided not to trade penny stocks because of the requirements of the penny stock rules and, as a result, the number of broker-dealers willing to act as market makers in such securities is limited. If we remain subject to the penny stock rules for any significant period, it could have an adverse effect on the market for our securities. If our securities are subject to the penny stock rules, investors will find it more difficult to dispose of our securities





ITEM 1B - UNRESOLVED STAFF COMMENTS





N/A




8





ITEM 2 - PROPERTIES





The Company leases approximately 560 square feet of office space in Santa Clara, California, for $756 per month pursuant to the terms of a one (1) year lease agreement commencing March 1, 2011 and ending February 28, 2012.





ITEM 3 - LEGAL PROCEEDINGS





Consumer Protection Corporation v. Neo-Tech News, a fictitiously named Defendant whose true legal identity is not known by Plaintiff, Joytoto USA, Inc., Joyon Entertainment, Inc., ABC Defendants 1-50, United States District Court for the District of Arizona, Case No. 08-1953-PHX-JAT





Plaintiff commenced this action on or about September 24, 2008, by the filing of a Complaint.  Plaintiff asserts claims arising from an alleged unsolicited facsimile concerning the Company.  Plaintiff alleges that the Company paid Neo-Tech News to broadcast the facsimile to Plaintiff as well as other members of the proposed class.  Based upon these allegations, Plaintiff asserts claims for violations of the Telephone Consumer Protection Act, declaratory judgment, civil conspiracy, and aiding and abetting.  Plaintiff seeks class certification, injunctive relief, damages in accordance with the Telephone Consumer Protection Act, costs, attorneys’ fees, and costs.





On January 5, 2010, the action was dismissed with prejudice.





ITEM 4 – Reserved .





PART II





ITEM 5 - MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES





Market Information





Our common stock is currently quoted on the OTC Bulletin Board.  Our common stock has traded under the symbol PLLX since October 24, 2008.





The following table sets forth the high and low bid information for each quarter within the two most recent fiscal years, as provided by the Nasdaq Stock Markets, Inc. The information reflects prices between dealers, and does not include retail markup, markdown, or commission, and may not represent actual transactions.





Fiscal Year

Ended


Bid PricesDecember 31,
Period

High


Low2009
First Quarter

$
0.10


$
0.02Second Quarter

$
0.24


$
0.02Third Quarter

$
0.13


$
0.04Fourth Quarter

$
0.16


$
0.042010
First Quarter

$
0.1


$
0.016Second Quarter

$
0.04


$
0.016Third Quarter

$
0.04


$
0.0005Fourth Quarter

$
0.04


$
0.0092





The Securities Enforcement and Penny Stock Reform Act of 1990 requires additional disclosure relating to the market for penny stocks in connection with trades in any stock defined as a penny stock. The Commission has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to a few exceptions which we do not meet. Unless an exception is available, the regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated therewith.





There are currently warrants outstanding to acquire an aggregate of 700,000 shares of our common stock at an exercise price of $3.00 per share which were issued to the holders of our Junior Convertible Debentures as part of the acquisition of JEI. There are also currently warrants outstanding to acquire an aggregate of 246,666 shares of our common stock at an exercise price of $10.50per share which were issued to three consultants as part of the acquisition of JEI.





Our transfer agent is Corporate Stock Transfer.




9





The number of holders of record of shares of our common stock is 32.





There have been no cash dividends declared on our common stock. Dividends are declared at the sole discretion of our Board of Directors.





Recent Sales of Unregistered Securities





The Company did not consummate any unregistered sales of its securities during the fiscal year ended December 31, 2010.





ITEM 6 - SELECTED FINANCIAL DATA





As a smaller reporting company we are not required to provide the information required by this Item.





ITEM 7 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION





Our Management’s Discussion and Analysis contains not only statements that are historical facts, but also statements that are forward-looking (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934). Forward-looking statements are, by their very nature, uncertain and risky. These risks and uncertainties include international, national and local general economic and market conditions; demographic changes; our ability to sustain, manage, or forecast growth; our ability to successfully make and integrate acquisitions; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; 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 risks that might be detailed from time to time in our filings with the Securities and Exchange Commission.





Although the forward-looking statements in this Annual Report on Form 10-K reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by them. Consequently, and because forward-looking statements are inherently subject to risks and uncertainties, the actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. You are urged to carefully review and consider the various disclosures made by us in this report and in our other reports as we attempt to advise interested parties of the risks and factors that may affect our business, financial condition, and results of operations and prospects.





Results of Operations





Introduction





We are a majority owned subsidiary of Joytoto Co., Ltd. (“Joytoto Korea”). We had one wholly-owned subsidiary, Joyon Entertainment, Inc. (“JEI”), and had two sub-subsidiaries, Joytoto Technologies, Inc., a Nevada corporation (“JTI”) and Joytoto America, Inc., a California corporation (“JAI”), both of which were wholly-owned subsidiaries of JEI.   Effective June 30, 2010, we, along with JEI, sold 100% of the issued and outstanding common stock of JAI to Joytoto Korea in exchange for the return and cancellation to us of 166,667 shares of our common stock held by Joytoto Korea.  Effective August 6, 2010, JEI was dissolved. The Company is determined to focus on its Online Games business by acquiring new game licenses to provide commercial service of such games in South Korea and the United States.





Our operations were originally organized into two business segments: Consumer Electronics and Online Games. On June 24, 2010, we dissolved JTI due to inactivity of the distributor contracts and lack of revenues generated in the Consumer Electronics business segment of the Company. The Company will focus on its Online Games segment.





Year ended December 31, 2010 compared to the Year ended December 31, 2009





Revenues, Expenses and Loss from Operations





Our revenues, selling, general and administrative expenses, depreciation, amortization, total costs and expenses, and net loss for the year ended December 31, 2010 and for the year ended December 31, 2009 are as follows:





Year Ended

December 31,

2009


Year Ended

December 31,

2010Revenue

$
60,000


$
57,340Cost of goods sold


54,000



-Selling, general and administrative


25,206,681



21,122,776Depreciation and Amortization


-



1,577Total costs and expenses


25,260,681



21,124,353Other expense - interest expense


(25,333)



(43,334)Gain (loss) from discontinued operations


(5,214,838)



313,522Net Loss

$
(30,440,852)


$
(20,796,825)





10





Revenue





Total revenue for the year ended December 31, 2010 was $57,340, compared to $60,000 for the year ended December 31, 2009.  The decrease of $2,660 or 4% was primarily due to the majority of revenue coming from our online games business instead of our consumer electronics business.





Selling, General and Administrative





General and Administrative expenses for the year ended December 31, 2010 was $21,122,776, compared to $25,206,681 for the year ended December 31, 2009.  The decrease of $4,083,905 or 16% was primarily due to stock based compensation due to the shares granted to our executive officers under their employment agreements.





Depreciation





Depreciation for the year ended December 31, 2010 was $1,577, compared to $8,309 for the year ended December 31, 2009.




Interest expense
 
 Interest expense for the year ended December 31, 2010 was $43,334, compared to $25,333 for the year ended December 31, 2009.  This increase was due to the increase in borrowings by the Company in 2010.
 
 Discontinued operations
 
 During 2010, the Company disposed of its’ subsidiary and related companies.  As a result, the Company recognized a gain of $372,198 on the disposal.  This gain was due to the assumption and forgiveness of liabilities on the disposal.  For the year ended December 31, 2010, the Company had a loss on the operations of the discontinued operations of $58,676, compared to a loss of $5,214,838 for the year ended December 31, 2009.  The decrease in the loss of discontinued operations is due to the impairment of licence agreements and goodwill of $4,227,975 and $52,912, respectively, which were incurred in 2009.  Additionally, the Company had amortization expense of $617,620 on the license agreements in 2009 prior to their impairment.


Net Loss





Our Net Loss for the year ended December 31, 2010 was $20,796,825, compared to $30,440,852 for the year ended December 31, 2009.  The decrease of $9,644,027 or 32% was primarily due to less stock based compensation due to the shares granted to executive officers and the impairment of our license agreements to be reduced to zero.





Liquidity and Capital Resources





Introduction





Our primary assets are the two online game license agreements and the Exclusive Distributorship Agreement. We have not begun to generate revenue from the two online game license agreements, and as a result we have very few current assets. Our cash requirements have been relatively small up to this point, but as a result of the acquisition of JEI and the fact that we are now a public, reporting company, we anticipate that our cash needs will increase dramatically. We anticipate satisfying these cash needs through the sale of our common stock until we not only begin to generate revenue, but until we can generate enough revenue to sustain our operations.





Cash Requirements





As stated above, we anticipate that our cash requirements will increase substantially as a result of the fact that we are now a public, reporting company and as we begin to increase operations to generate revenue from our license and distributorship agreements.




11





Sources and Uses of Cash





Operations





Net loss for the year ended December 31, 2010 was $20,796,825, compared to $30,440,852 for the year ended December 31, 2009.  The decrease of $9,644,027 or 32% was primarily due to decrease in impairment of Company’s license agreements. This was offset by depreciation and amortization of $1,577, stock based compensation of $20,833,333, an decrease in accrued expenses of $194,216, for total cash used in operating activities of $112,344.





Revenue for the year ended December 31, 2010 was $57,340, compared to $60,000 for the year ended December 31, 2009.  The decrease of $2,660 or 4% was primarily due to the majority of revenue coming from our online games business instead of our consumer electronics business.





Investments





For the year ended December 31, 2010, we invested $67,252, which relates the purchase of property and equipment of $8,502 and acquisition of license agreements of $58,750.





Financing





For the year ended December 31, 2010, our cash flows from financing activities totaled $247,541, from $349,500 in loan proceeds offset by the repayment of $101,959 in loans.





For the year ended December 31, 2009, our cash flows from financing activities totaled $312,252, from $327,552 in loan proceeds offset by the repayment of $15,000 in loans.





Critical Accounting Policies





The discussion and analysis of the Company’s financial condition and results of operations are based upon its financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. In consultation with its Board of Directors, the Company has identified the following accounting policies that it believes are key to an understanding of its financial statements. These are important accounting policies that require management’s most difficult, subjective judgments.





Valuation of License Agreements





In 2007, the Company acquired the following license agreements:





·
On February 23, 2007, JAI entered into a license agreement with Joytoto Korea, for one game, Pang Pang Terrible, for consideration of $400,000.  The license is for the United States of America territory and is for a term of 3 years.


·
On April 18, 2007, JAI entered into an exclusive North American Master License Agreement with Joytoto Korea and Joyon Korea.  The license gives JAI the exclusive right to the use and commercialization of 4 game titles immediately, and the right to acquire no less than 20 additional game title licenses for no additional consideration.  The term of the agreement is 10 years and allows for two 5 year extensions for additional consideration of $10,000.  Upon execution of the Master License Agreement, JEI issued Joyon Korea 30,000,000 common shares as consideration.  Prior to the acquisition of the Master License Agreement, JEI had an independent business valuation performed whereby the Company’s enterprise value was calculated to be $0.1799 per share.  Accordingly, the shares issued for the license were valued at this amount.


·
On June 11, 2007, JTI entered into an Exclusive Distributorship Agreement with Joytoto Korea.  The agreement provides that JTI has the worldwide, exclusive right to distribute, market, promote and sell Joytoto Korea’s current and future model MP3 player devices.  As consideration for the Exclusive Distributorship Agreement, JEI issued Joytoto Korea 30,000,000 common shares.  Prior to the acquisition of the Exclusive Distributorship Agreement the Company had an independent business valuation performed whereby the Company’s enterprise value was calculated to be $0.3562 per share.  Accordingly, the shares issued for the license agreement were valued at this amount.




12




These license agreements were being amortized over their useful lives ranging from 3 to 10 years. The company periodically evaluates the reasonableness of the useful lives of these intangible assets.  In 2008 and 2009, these licenses were evaluated for impairment as follows:





·
At September 30, 2008, the Company reviewed its license agreements for impairment due to the deteriorating market for consumer goods in the US.  At that time, the Company reviewed and adjusted its discounted cash flow projections. As a result of this assessment, the Company determined that the value of its license agreements was $5,000,000. As such, an impairment charge of $9,095,227 was recorded to reduce the carrying amount of the license agreements to this amount.


·
The Company reviewed its license agreements for impairment again at December 31, 2009 and determined that the license agreements were completely impaired and should be reduced to zero.  Accordingly, the Company recognized an impairment loss of $4,227,975 in 2009.  The Company reached this conclusion due to its’ inability to generate the revenues originally anticipated as well the difficulty in raising the necessary funds to develop and utilize the licenses due to the current difficult credit environment.





During 2010, the Company acquired license agreements for 16 online games for use in South Korea.  These agreements called for a total of $120,500 in license fees, $30,000 in nonrefundable royalty prepayments on two of the licenses and a $5,000 non refundable deposit on one of the licenses.  The Company paid $73,750 of these fees during the nine months ended September 30, 2010 and will pay the remaining fees of $81,750 when the games are launched commercially.  Each license also has a royalty fee which varies for each license.  Future royalties will be offset against the $30,000 prepayment.   The licenses have terms of 2 to 3 years, beginning when they are launched commercially.





Revenue Recognition





Revenues are recognized when all of the following criteria have been met: persuasive evidence for an arrangement exists; delivery has occurred or services have been rendered; the fee is fixed or determinable; and collectability is reasonably assured.





Equipment and Depreciation





Equipment is stated at cost and is depreciated using the straight line method over the estimated useful lives of the respective assets. Routine maintenance, repairs and replacement costs are expensed as incurred and improvements that extend the useful life of the assets are capitalized.  When equipment is sold or otherwise disposed of, the cost and related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is recognized in operations.





Stock-Based Compensation





The Company accounts for employee stock based compensation and stock issued for services using the fair value method. The Company accounts for stock issued for services using the fair value method. The measurement date of shares issued for services is the date at which the counterparty’s performance is complete.





Off-balance Sheet Arrangements





We have no off-balance sheet arrangements that 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 is deemed by our management to be material to investors.





ITEM 7A - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK





As a smaller reporting company we are not required to provide the information required by this Item.





13




ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 
 POLLEX, INC.
 
 AUDITED FINANCIAL STATEMENTS
 FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009
 
 
 
 
 CONTENTS

PageReport of Independent Registered Public Accounting Firm

F-2Balance Sheets

F-3Statements of Operations

F-4Statement of Stockholders’ Equity (Deficit)

F-5Statements of Cash Flows

F-6Notes to Financial Statements

F-7
 
 
 
  F-1
  MEYLER & COMPANY, LLC
 CERTIFIED PUBLIC ACCOUNTANTS
 ONE ARIN PARK
 1715 HIGHWAY 35
 MIDDLETOWN, NJ 07748
 
 
 
 Report of Independent Registered Public Accounting Firm
 
 
 To the Board of Directors
 Pollex, Inc.
 Santa Clara, CA
 
 We have audited the accompanying balance sheets of Pollex, Inc. as of December 31, 2010 and 2009 and the related statements of operations, stockholders’ equity (deficit), and cash flows for each of the years in the two-year period ended December 31, 2010.  These financial statements are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements based on our audits.
 
 We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting.  Accordingly, we express no such opinion.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.
 
 In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Pollex, Inc. as of December 31, 2010 and 2009, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2010, in conformity with accounting principles generally accepted in the United States of America.
 
 The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  As discussed in Note B to the financial statements, the Company incurred net losses of $20,796,825 and $30,440,852 in 2010 and 2009 and had an accumulated deficit of $138,361,213 at December 31, 2010.  These conditions raise substantial doubt about its ability to continue as a going concern.  Management’s plans regarding these matters are also described in Note B.  The financial statements do not include any adjustments that may result from the outcome of this uncertainty.
 
 /s/ Meyler & Company, LLC
 
 Middletown, New Jersey
 March 31, 2011
 F-2




POLLEX, INC.BALANCE SHEETSDecember 31,2010


2009(Consolidated)ASSETSCURRENT ASSETSCash and cash equivalents

$
11,452


$
5,257Total current assets


11,452



5,257Property and equipment, net of accumulateddepreciation of $1,577 and $23,541, respectively


6,925



-OTHER ASSETS:License Agreements


120,500



-Prepaid royalty


30,000



-Due from affiliated company


1,963



-Deposits


6,000



-Assets of discontinued operations


-



6,558Total other assets


158,463



6,558Total Assets

$
176,840


$
11,815LIABILITIES AND STOCKHOLDERS' DEFICITCURRENT LIABILITIESAccrued expenses and accounts payable


627,823



743,514Due to affiliate


194,056



194,056Loans payable


856,193



608,652Total Current Liabilities


1,678,072



1,546,222Stockholders' DeficitCommon stock, authorized 300,000,000 shares;par value $0.001; 4,955,022 and 5,121,689 issued andoutstanding at December 31,2010 and 2009, respectively


4,953



5,120Additional paid-in capital


136,855,028



116,024,861Accumulated deficit


(138,361,213
)


(117,564,388
)Total Stockholders’ Deficit


(1,501,232
)


(1,534,407
)Total Liabilities and Stockholders’ Deficit

$
176,840


$
11,815See accompanying notes to financial statements.
  F-3


POLLEX, INC.STATEMENTS OF OPERATIONSFor the years endedDecember 31,2010


2009(Consolidated)REVENUES

$
57,340


$
60,000COSTS AND  EXPENSESCost of goods sold


-



54,000Selling, general and administrative


21,122,776



25,206,681Depreciation and amortization


1,577



-Total Costs and Expenses


21,124,353



25,260,681OPERATING LOSS


(21,067,013
)


(25,200,681
)OTHER EXPENSEInterest expense


(43,334
)


(25,333
)Total Other Expense


(43,334
)


(25,333
)LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES


(21,110,347
)


(25,226,014
)PROVISION FOR INCOME TAXES


-



-LOSS FROM CONTINUING OPERATIONS


(21,110,347
)


(25,226,014
)DISCONTINUED OPERATIONSGain on disposal of discontinued operations, net of tax


372,198



-Loss from discontinued operations, net of tax


(58,676
)


(5,214,838
)Gain (loss) from discontinued operations


313,522



(5,214,838
)NET LOSS


(20,796,825
)


(30,440,852
)NET INCOME (LOSS) PER COMMON SHARE (Basic and Diluted)Continuing operations

$
(4.17
)

$
(4.93
)Discontinued operations


0.06



(1.02
)$
(4.11
)

$
(5.94
)WEIGHTED AVERAGE SHARESOUTSTANDING


5,056,849



5,120,417See accompanying notes to financial statements.
  F-4
  POLLEX, INC.STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)For the years ended December 31, 2009 and 2010TotalAdditional





Stockholders'Common Stock


Paid in


Accumulated


EquityShares


Amount


Capital


Deficit


(Deficit)Balance, December 31, 2008


5,121,689



5,120



91,024,861



(87,123,536
)


3,906,445Stock based compensation


-



-



25,000,000



-



25,000,000Net loss for the year ended December 31, 2009


-



-



-



(30,440,852
)


(30,440,852
)Balance, December 31, 2009


5,121,689



5,120



116,024,861



(117,564,388
)


(1,534,407
)Stock based compensation


-



-



20,833,333



-



20,833,333Cancellation of common stock


(166,667
)


(167
)


(3,166
)






(3,333
)Net loss for the year ended December 31, 2009


-



-



-



(20,796,825
)


(20,796,825
)Balance, December 31, 2010


4,955,022


$
4,953


$
136,855,028


$
(138,361,213
)

$
(1,501,232
)See accompanying notes to financial statements.
  F-5
  POLLEX, INC.STATEMENTS OF CASH FLOWSFor the years endedDecember 31,2010


2009(Consolidated)CASH FLOWS FROM OPERATING ACTIVITIESNet loss

$
(20,796,825
)

$
(30,440,852
)Gain (loss) from discontinued operations


(313,522
)


5,214,838Adjustments to reconcile net loss to net cashused in continuing operating activities:Depreciation and amortization


1,577



-Stock based compensation


20,833,333



25,000,000Changes in assets and liabilities:(Increase) decrease in prepaid royalties


(15,000
)


-(Increase) decrease in receivable from affiliate


(1,963
)


-(Increase) decrease in deposits


(1,000
)


-Increase (decrease) in accrued expenses


(194,216
)


218,563Net cash used in continuing operating activities


(487,616
)


(7,451
)Net cash provided by (used in) discontinued operating activities


313,522



(308,203
)Net cash provided by operating activities


(174,094
)


(315,654
)CASH FLOWS FROM INVESTING ACTIVITIESPurchase of property and equipment


(8,502
)


-Acquisition of license agreements


(58,750
)


-Net cash provided by investing activities


(67,252
)


-CASH FLOWS FROM FINANCING ACTIVITIESLoan proceeds


349,500



327,252Repayment of loan


(101,959
)


(15,000
)Net cash provided by financing activities


247,541



312,252Net increase (decrease) in cash


6,195



(3,402
)CASH AT BEGINNING OF YEAR


5,257



8,659CASH AT END OF YEAR

$
11,452


$
5,257SUPPLEMENTAL CASH FLOW DISCLOSURES:Cash paid for interest

$
-


$
-Cash paid for taxes

$
900


$
-See accompanying notes to financial statements.


F-6





POLLEX, INC.


NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
 
 
 NOTE A – ORGANIZATION AND DESCRIPTION OF BUSINESS
 
 Pollex, Inc. (the “Company”) is a majority owned subsidiary of Joytoto Co., Ltd. (“Joytoto Korea”). The Company had one wholly-owned subsidiary, Joyon Entertainment, Inc. (“JEI”), and had two sub-subsidiaries, Joytoto Technologies, Inc., a Nevada corporation (“JTI”) and Joytoto America, Inc., a California corporation (“JAI”), both of which were wholly-owned subsidiaries of JEI.
 
 Effective June 24, 2010, the Company dissolved JTI.  The Company filed a certificate of dissolution with the Secretary of State of Nevada on June 24, 2010.  JTI was mostly inactive during 2009 and 2010.
 
 Effective June 30, 2010, the Company, along with JEI, sold 100% of the issued and outstanding common stock of JAI to Joytoto Korea in exchange for the return and cancellation of 166,667 shares of the Company’s common stock held by Joytoto Korea.
 
 Effective August 6, 2010, JEI was dissolved. The Company is determined to focus on its Online Games business by acquiring new game licenses to provide commercial service of such games in South Korea and the United States.
 
 Operations are focused in Online Games by acquiring new game licenses to provide commercial service of such games in South Korea and the United States. Our Online Games business segment has generated $57,340 as of December 31, 2010
 
 Pollex, Inc. is currently operating “The Great Merchant” which is in beta service. Full commercial service is expected in the 2nd Quarter of 2011. The Company has acquired license agreements for 16 games for use in South Korea.
 
 NOTE B – GOING CONCERN
 
 As indicated in the accompanying consolidated financial statements, the Company incurred net losses of $20,796,825 and $30,440,852 for the years ended December 31, 2010 and 2009 and has an accumulated deficit of $138,631,213 at December 31, 2010. Management’s plans include raising capital through the equity markets to fund future operations and generating revenue through its license agreements.  Failure to raise adequate capital and generate adequate sales revenues could result in the Company having to curtail or cease operations.  Additionally, even if the Company does raise sufficient capital to support its operating expenses and generate adequate revenues, there can be no assurances that the revenue will be sufficient to enable it to develop business to a level where it will generate profits and cash flows from operations.  These matters raise substantial doubt about the Company’s ability to continue as a going concern.  However, the accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.  These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.
 
 NOTE C – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
 Consolidated Financial Statements
 
 The consolidated financial statements for the year ended December 31, 2009 include the accounts of Pollex, Inc. and its wholly owned subsidiary.  All significant intercompany balances and transactions were eliminated in consolidation.  During 2010, the Company dissolved its sub-subsidiary, JEI, and its sub-subsidiary, JTI, and sold its subsidiary, JAI.  As a result of these transactions, the Company no longer had a subsidiary on December 31, 2010 and the financial statements are thus not consolidated.
 
 F-7
 
 POLLEX, INC.
 
 NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
 
 
 NOTE C – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
 Use of Estimates
 
 The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.
 
 Cash Equivalents
 
 The Company considers all highly-liquid investments with an original maturity of three months or less to be cash equivalents.  In addition, amounts on deposit with Paypal, a third party payment processor, are considered cash equivalents.
 
 Equipment and Depreciation
 
 Equipment is stated at cost and is depreciated using the straight line method over the estimated useful lives of the respective assets. Routine maintenance, repairs and replacement costs are expensed as incurred and improvements that extend the useful life of the assets are capitalized.  When equipment is sold or otherwise disposed of, the cost and related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is recognized in operations.
 
 Revenue Recognition
 
 The Company recognizes revenue from the sale of products and services in accordance with Accounting Standards Codification (“ASC”) 605, “Revenue Recognition.”  Revenues are recognized when all of the following criteria have been met: persuasive evidence for an arrangement exists; delivery has occurred or services have been rendered; the fee is fixed or determinable; and collectibility is reasonably assured.  The Company recognizes revenues from the sale of its’ online games, currently the Great Merchant, when the game has been played and paid for by the customer.  All payments are made through Paypal.
 
 Intangible Assets, Goodwill and License Agreements
 
 Goodwill and intangibles with indefinite lives are not amortized; rather they are tested for impairment at least annually.
 
 Intangible assets and license agreements with definite lives are amortized over their useful lives ranging from 3 to 10 years.  The company periodically evaluates the reasonableness of the useful lives of these intangible assets.  The Company begins amortizing license agreements when they are put into service, which is when the contractual life of the agreements commences.
 
 In order to test goodwill and other intangible assets with indefinite lives for impairment, a determination of the fair value of the Company’s reporting units for its goodwill valuation and its other intangible assets with indefinite lives is required and is based upon, among other things, estimates of future operating performance of the reporting unit being valued.  Changes in market conditions, among other factors may have an impact on these estimates.
 
 F-8
 
 POLLEX, INC.
 
 NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
 
 
 NOTE C – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
 Intangible Assets, Goodwill and License Agreements (Continued))
 
 The Company reviews long-lived assets, including intangibles with definite useful lives, for impairment whenever events or changes in circumstances indicate the carrying amount of an asset 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.
 
 See Notes E and F as to impairment of license agreements and goodwill.
 
 Advertising Expense
 
 Advertising expenses are included in Selling, general and administrative expenses in the Statement of Operations and are expensed as incurred.  The Company incurred $0 and $1,546 in advertising expenses for the years ended December 31, 2010 and 2009, respectively.
 
 Fair Values of Financial Instruments
 
 The Company has adopted ASC 820, Fair Value Measurements and Disclosures (“ASC 820”) for its financial assets and liabilities. Management uses the fair value hierarchy of ASC 820, which gives the highest priority to quoted prices in active markets. The fair value of financial instruments is estimated based on market trading information, where available. Absent published market values for an instrument or other assets, management uses observable market data to arrive at its estimates of fair value.   The carrying values of accrued expenses and accounts payable, due to affiliate and loans payable approximate their fair value due to the short-term maturities of these assets and liabilities.
 
 ASC 820 defines fair value as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, ASC 820 establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The three levels of inputs used to measure fair value are as follows:
 
 Level 1
Quoted prices in active markets for identical assets or liabilities.
 
 Level 2
Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted price for identical or similar assets and liabilities in markets that are not active; or other input that are observable or can be corroborated by observable market data.Level 3
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.
 
 As of December 31, 2010, the Company has no financial assets or liabilities that were measured at fair value on a recurring basis.
 
 F-9
 
 POLLEX, INC.
 
 NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
 
 
 NOTE C – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
 Income Taxes
 
 Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.
 
 Net Loss Per Common Share
 
 Basic earnings per share (“EPS”) is computed by dividing the income (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period.  Diluted EPS is based on the weighted-average number of shares of common stock and common stock equivalents outstanding during the periods. There are no potential dilutive common shares at December 31, 2010.
 
 Stock-Based Compensation
 
 The Company accounts for employee stock based compensation and stock issued for services using the fair value method.
 
 The Company accounts for stock issued for services using the fair value method.  The measurement date of shares issued for services is the date at which the counterparty’s performance is complete.
 
 Recent Accounting Pronouncements
  In October 2009, the FASB issued ASU 2009-13, which amends ASC 605-25 “Revenue Recognition–Multi-Deliverable Arrangements”. ASU 2009-13 requires arrangement consideration to be allocated to all deliverables at inception using a relative selling price method and establishes a selling price hierarchy for determining the selling price of a deliverable. The update also expands the disclosure requirements to include additional detail regarding the deliverables, method of calculation of selling price and the timing of revenue recognition. ASU 2009-13 is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. The adoption of these amendments is not expected to have a material effect on the Company’s financial statements.
 
 NOTE D- DISCONTINUED OPERATIONS
 
 On June 24, 2010, the Company dissolved its sub-subsidiary, jti.  The Company filed a certificate of dissolution with the Secretary of State of Nevada on June 24, 2010.  JTI was mostly inactive during 2009 and 2010.  In relation to the dissolution, the Company assumed $365,871 in liabilities of JTI.
 
 On August 11, 2010, the Company, along with its wholly owned subsidiary, JEI, entered into a stock purchase agreement with Joytoto Korea, effective as of June 30, 2010.  JEI owns 100% of the issued and outstanding common stock of JAi.  Pursuant to the terms of the Agreement, the Company and JEI sold 100% of the issued and outstanding common stock of JAI to Joytoto Korea in consideration for the return and cancellation of 166,667 shares of the Company’s common stock held by Joytoto Korea.   At June 30, 2010, JAI had assets of $6,546 and liabilities of $205,296.
 
 On August 6, 2010, JEI was dissolved.
 
 F-10
 
 POLLEX, INC.
 
 NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
 
 
 NOTE D- DISCONTINUED OPERATIONS (CONTINUED)
 
 As a result of the above transactions, the Company recognized a gain of $372,198 on the disposals and a loss of 58,676 on the operations of the discontinued operations though the date of the disposas.
 
 As a result of the the above transactions, the assets of JEI, JAI and JTI are classified as discontinued operations on the consolidated balance sheets at December 31, 2009.
 
 The following summarizes the results of the discontinued operations for 2010 and 2009:
 
 December 31,2010


2009Revenues

$
-


$
-Cost and expensesCost of goods sold


-



-Selling, general and administrative


56,975



308,022Impairment of license agreements


-



4,227,975Impairment of goodwill


-



52,912Depreciation and amortization


-



625,929Interest expense


1,697



-58,676



5,214,838Loss from operations of discontinued operations

$
(58,676
)

$
(5,214,838
)
 
 NOTE E – FIXED ASSETS
 
 Fixed Assets are comprised of the following:
 
 December 31,

Estimated2010


2009

Useful LifeComputers

$
8,502


$
23,500

3 yearsFurniture and fixtures


-



3,328

7 years8,502



26,828(1,577
)


(23,541
)$
6,925


$
3,287
 
 Depreciation expense was $1,577 and $8,309 for the years ended December 31, 2010 and 2009, respectively.  Depreciation expense for the year ended December 31, 2009 is included in discontinued operations.
 
 F-11
 POLLEX, INC.
 
 NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
  NOTE F – LICENSE AGREEMENTS
  In 2007, the Company acquired the following license agreements:
  ·  On February 23, 2007, JAI entered into a license agreement with Joytoto Korea, for one game, Pang Pang Terrible, for consideration of $400,000.  The license is for the United States of America territory and is for a term of 3 years.
  ·  On April 18, 2007, JAI entered into an exclusive North American Master License Agreement with Joytoto Korea and Joyon Korea.  The license gives JAI the exclusive right to the use and commercialization of 4 game titles immediately, and the right to acquire no less than 20 additional game title licenses for no additional consideration.  The term of the agreement is 10 years and allows for two 5 year extensions for additional consideration of $10,000.  Upon execution of the Master License Agreement, JEI issued Joyon Korea 30,000,000 common shares as consideration.  Prior to the acquisition of the Master License Agreement, JEI had an independent business valuation performed whereby the Company’s enterprise value was calculated to be $0.1799 per share.  Accordingly, the shares issued for the license were valued at this amount.
 In 2007, the Company acquired the following license agreements:



·On February 23, 2007, JAI entered into a license agreement with Joytoto Korea, for one game, Pang Pang Terrible, for consideration of $400,000.  The license is for the United States of America territory and is for a term of 3 years.



·On April 18, 2007, JAI entered into an exclusive North American Master License Agreement with Joytoto Korea and Joyon Korea.  The license gives JAI the exclusive right to the use and commercialization of 4 game titles immediately, and the right to acquire no less than 20 additional game title licenses for no additional consideration.  The term of the agreement is 10 years and allows for two 5 year extensions for additional consideration of $10,000.  Upon execution of the Master License Agreement, JEI issued Joyon Korea 30,000,000 common shares as consideration.  Prior to the acquisition of the Master License Agreement, JEI had an independent business valuation performed whereby the Company’s enterprise value was calculated to be $0.1799 per share.  Accordingly, the shares issued for the license were valued at this amount.  ·  On June 11, 2007, JTI entered into an Exclusive Distributorship Agreement with Joytoto Korea.  The agreement provides that JTI has the worldwide, exclusive right to distribute, market, promote and sell Joytoto Korea’s current and future model MP3 player devices.  As consideration for the Exclusive Distributorship Agreement, JEI issued Joytoto Korea 30,000,000 common shares.  Prior to the acquisition of the Exclusive Distributorship Agreement, JEI had an independent business valuation performed whereby the Company’s enterprise value was calculated to be $0.3562 per share.  Accordingly, the shares issued for the license agreement were valued at this amount.
  These license agreements were being amortized over their useful lives ranging from 3 to 10 years. The company periodically evaluates the reasonableness of the useful lives of these intangible assets.  In 2008 and 2009, these licenses were evaluated for impairment as follows:
  ·  At September 30, 2008, the Company reviewed its license agreements for impairment due to the deteriorating market for consumer goods in the US.  At that time, the Company reviewed and adjusted its discounted cash flow projections. As a result of this assessment, the Company determined that the value of its license agreements was $5,000,000. As such, an impairment charge of $9,095,227 was recorded to reduce the carrying amount of the license agreements to this amount.
  ·  The Company reviewed its license agreements for impairment again at December 31, 2009 and determined that the license agreements were completely impaired and should be reduced to zero.  Accordingly, the Company recognized an impairment loss of $4,227,975 in 2009.  The Company reached this conclusion due to its’ inability to generate the revenues originally anticipated as well the difficulty in raising the necessary funds to develop and utilize the licenses due to the current difficult credit environment.
  Amortization expense was $0 and $617,620 for the years ended December 31, 2010 and 2009. respectively.  Depreciation expense for the year ended December 31, 2009 is inlcuded in discontinued operations.
  F-12
  POLLEX, INC.
  NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
   NOTE F – LICENSE AGREEMENTS (CONTINUED)
  During 2010, the Company acquired license agreements for 16 online games for use in South Korea.  These agreements called for a total of $120,500 in license fees, $30,000 in nonrefundable royalty prepayments on two of the licenses and a $5,000 non refundable deposit on one of the licenses.  The Company paid $73,750 of these fees during the nine months ended September 30, 2010 and will pay the remaining fees of $81,750 when the games are launched commercially.  Each license also has a royalty fee which varies for each license.  Future royalties will be offset against the $30,000 prepayment.   The licenses have terms of 2 to 3 years, beginning when they are launched commercially.of the Master License Agreement, JEI had an independent business valuation performed whereby the Company’s enterprise value was calculated to be $0.1799 per share.  Accordingly, the shares issued for the license were valued at this amount.
  NOTE G – GOODWILL
 
 In connection with the Company’s acquisition of JAI on April 18, 2007, the Company recognized Goodwill of $52,912, which represented the excess of the purchase price over the fair value of the net assets of JAI.
  The Company reviewed tested Goodwill for impairment at December 31, 2009 and concluded that the Goodwill was completely impaired and should be reduced to zero.  Accordingly, the Company recognized an impairment loss of $52,912 in 2009.  This plus the impairment of the license agreements discussed in Note E resulted in the fair value of JAI being reduced to zero.
  NOTE H – DUE TO AFFILIATE
 
 Certain expenses have been paid on behalf of the Company by Joytoto Korea. The Company has recognized the expenses and corresponding payable to Joytoto Korea as due to affiliate. The advances are non-interest bearing and have no specific repayment date.
 
 NOTE I – LOANS PAYABLE
 
 During 2008, the Company signed promissory notes with two individuals totaling $296,400.  The terms of the promissory notes are one year and bears interest at an annual rate of 6%.  The notes may be repaid at any time prior to its due date without a prepayment penalty, however if any amount of the principal plus accrued interest remains unpaid after the notes due date then the annual rate of interest increases to 10% per annum.
 
 During 2010, the Company repaid $101,959 of these notes and received additional proceeds of $349,500 from additional promissory notes from two individuals.
 
 During 2009, the Company repaid $34,419 of these notes and received additional proceeds of $346,671 from additional promissory notes.  The remaining $608,652 in notes is with one individual.
 
 F-13
 
 POLLEX, INC.
 
 NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
 
 NOTE J - INCOME TAXES
 
 The Company files a consolidated income tax return on a calendar year basis.  At December 31, 2010, the Company had an unused net operating loss carryforward of approximately $4,250,000 for income tax purposes, which expires between 2027 and 2029..  This net operating loss carryforward may result in future income tax benefits of approximately $1,275,000; however because realization is uncertain at this time, a valuation reserve in the same amount has been established.  Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.
 
 Significant components of the Company’s deferred tax liabilities and assets as of December 31, 2010 and 2009 are as follows:
 
 December 31,2010


2009Deferred tax liabilities

$
-


$
-Deferred tax asset-Operating loss carryforward


1,400,000



1,500,000Valuation allowance


(1,400,000
)


(1,500,000
)Net deferred tax asset


-



-
 
 The income tax expense (benefit) differs from the amount computed by applying the United States statutory corporate income tax rate as follows:
 December 31,2010


2009U.S. Statutory Income Tax Rate


34
%


(34
)%Utilization of net operating loss carryforwards


(34
)%


-Change in valuation allowance on deferred tax assets


-



34
%-
%


-
%
 NOTE K – WARRANTS
 
 In connection with the acquisition of JEI, 700,000 warrants with an exercise of $3.00 were issued to the debenture holders. The warrants were valued at $42.78 per warrant or $29,943,900. The warrants vested immediately and expire October 31, 2014. The warrants were valued using a Black-Scholes valuation model and were recorded in selling, general and administrative expense.
 
 In connection with the acquisition of JEI, the company issued 133,333 warrants with an exercise price of $37.71 to consultants on October 31, 2007.  The warrants were valued at $37.71 per warrant or $5,028,000. The warrants vested immediately and expire October 31, 2014. The warrants were valued using a Black- Scholes valuation model and were recorded in selling, general and administrative expense.
 
 The Company entered into a consulting agreement with London Finance Group, Ltd. (“LFG”) on October 12, 2007 with an effective date of October 1, 2007 and is for a period of two years.  In connection with this agreement, the Company gave LFG warrants to purchase 113,333 shares of common stock at an exercise price of $10.50 per share. The warrants vested immediately and expire October 31, 2014.  The value of the warrants was determined to be $37.71 per warrant or $4,273,800 using a Black-Scholes valuation model.  Accordingly, this amount was recorded in selling, general and administrative expense.
 
 The following are the assumptions used in determining the above fair values using the Black-Scholes option pricing model:
 
 Expected life

7 yearsRisk free rate

4.20%Volatility

43.50%Dividend yield

0%
  F-14
  POLLEX, INC.
 
 NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
 
 
 NOTE K – WARRANTS (CONTINUED)
 
 The following summarizes warrant activity during 2009 and 2010:
 
 Shares


Weighted

Average

Grant Date

Fair ValueOutstanding, January 1, 2009


946,667


$
41.46Granted


-



-Forfeited


-



-Expired


-



-Exercised


-



-Outstanding, December 31, 2009


946,667


$
41.46Granted


-



-Forfeited


-



-Expired


-



-Exercised


-



-Outstanding, December 31, 2010


946,667


$
41.46
 
 The weighted average remaining contractual life and exercise price of the warrants outstanding and exercisable at December 31, 2010 was 3.84 years and $4.95, respectively.  The intrinsic value of the warrants outstanding and exercisable at December 31, 2010 was $0 as the stock price exceeded the exercise price.
 
 The weighted average remaining contractual life and exercise price of the warrants outstanding and exercisable at December 31, 2009 was 4.84 years and $4.95, respectively.  The intrinsic value of the warrants outstanding and exercisable at December 31, 2008 was $0 as the stock price exceeded the exercise price.
 
 NOTE L – COMMITMENTS AND CONTINGENCIES
 
 Property Leases:
 
 During 2008 and 2009, the Company leased office facilities in Santa Clara, California. The lease commenced on March 1, 2007 and is for a term of one year.  The lease was renewed on March 1, 2008 and ended on March 1, 2009.  The Company’s rent payments were $1,536 per month.
 
 On April 1, 2009, the Company signed a one year lease on office space in Santa Clara, California.  This lease was not renewed on April 1, 2010.  The Company’ rent payments were $1,864 per month.  The Company’s rental payments in 2010 prior to the termination of the lease were $5,592.
 
 On March 1, 2010, the Company signed a one year lease on office space in Santa Clara, California.  This lease term was through February 28, 2011, but was renewed through February 28, 2012.  The Company’s rent payments were $756 per month.
 
 F-15
 
 POLLEX, INC.
 
 NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
 
 
 NOTE L – COMMITMENTS AND CONTINGENCIES (Continued)
 
 The Company was leasing an apartment in Santa Clara, California for use of its President.  The lease was for a term of one year commencing November 1, 2008 and was renewed October 26, 2009.  The lease term is through December 25, 2010.  The lease payments were $3,300 per month.  The President renewed this lease in January 2011 through December 2011 at a monthly rent of $2,998.  The Company has decided that this apartment will no longer be reimbursed to the President in 2011.
 
 The minimum future lease commitment on the above leases, exclusiveof the apartment lease which is no longer reimbursable to the President, is $10,584 through 2011.
 
 Rent expense for the years ended December 31, 2010 and 2009 was $45,132 and $53,442, respectively.
 
 Auto Leases:
 
 The Company signed a lease in December 2008 to lease an automobile for its’ CEO.  The lease runs through December 14, 2012.  The lease payments are $578 per month.  The minimum future lease commitment on these leases is as follows:
 2011


6,9332012


6,356$
13,289
 
 Employment Agreements:
 
 Through its former subsidiary, JEI, the Company had employment agreements with all three of the Company’s executives.  These employment agreements were all dated October 31, 2007 and ran through October 31, 2010.
 
 Under the employment agreement, Seong Yong Cho served as President and Chief Executive Officer, Seong Sam Cho served as Chief Financial Officer, and Doo Ho Choi serves as Chief Operating Officer.   In exchange for their services, each of the three executives received $12,000 per annum, which was increased to $60,000 per annum starting April 1, 2009.  They were eligible for a bonus, not to exceed one half of annual compensation, if approved by JEI’s Board of Directors.
 
 Seong Yong Cho and Seong Sam Cho were each issued 700,000 shares (post splits) and Doo Ho Choi was issued 266,667 shares (post splits) under their employment agreements.  However, those shares were subject to a repurchase right by the Company over the next 36 months beginning November 1, 2007, at a purchase price of $0.03 per share (post splits).  The repurchase right expired as to 1/36th of the shares for every month the executives are employed.  Therefore, if each of the executives remains employed over the next 36 months, they will each own the shares free and clear of the Company’s repurchase right.  These shares are also subject to a one year lock-up period during which they cannot be sold or otherwise transferred without restrictive legend.  The 36 month term expired on October 31, 2010 without the Company exericising its’ repurchase right. Therefore, these employees own the shares of our common stock free and clear from our repurchase right.
 
 The Company valued the total shares issued at the grant date fair value of $45.00 per share (post splits), or $75,000,000.  The Company recognized this expense over the life of the employment agreements.
 
 F-16
 
 POLLEX, INC.
 
 NOTES TO FINANCIAL STATEMENTS
 December 31, 2010
 
 
 NOTE L – COMMITMENTS AND CONTINGENCIES (Continued)
 Litigation:
  On or about September 24, 2008, an action was commenced alleging the Company was sending unsolicited facsimiles concerning the Company.   Based upon the allegations, the plaintiff asserted claims for violations of the Telephone Consumer Protection Act, declaratory judgment, civil conspiracy, and aiding and abetting.  Plaintiff sought class certification, injunctive relief, damages in accordance with the Telephone Consumer Protection Act, costs, attorneys’ fees, and costs.
 
 On January 5, 2010, the action was dismissed with prejudice.
 
 NOTE M – SALES CONCENTRATION
 
 The revenues in 2009 represent one sale of components parts.
 
 NOTE N- SUBSEQUENT EVENTS
 
 Debt Cancellation
 
 On March 21, 2011, the Company, entered into a Conversion and Release Agreement (the “Agreement”) with Joytoto Korea.  Pursuant to the terms of the Agreement, the Company issued 166,666 shares of its common stock to Joytoto Korea in consideration for the cancellation of $20,000 owed to Joytoto Korea by the Company.
 
 Employment Agreements
 
 On March 21, 2011, the Company entered into three year employment agreements (the “Employment Agreements”) with each of Seong Yong Cho, its current President and Chief Executive Officer, and Seong Sam Cho, its current Chief Financial Officer, respectively.  Pursuant to the terms of the Employment Agreements, Mr. Seong Yong Cho will continue to serve as President and Chief Executive Officer of the Company for an annual salary of $1.00 and Mr. Seong Sam Cho will continue to serve as Chief Financial Officer of the Company for an annual salary of $1.00.  These employment agreement run through March 21, 2014.
  F-17




ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE





There are no events required to be disclosed under the Item.





ITEM 9A - CONTROLS AND PROCEDURES





Evaluation of Disclosure Controls and Procedures










We conducted an evaluation, with the participation of our Chief Executive Officer and Chief Financial Officer, 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 amended, or the Exchange Act, as of December 31, 2010, to ensure 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 Securities Exchange Commission's rules and forms, including to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of December 31, 2010, our disclosure controls and procedures were not effective at the reasonable assurance level due to the material weaknesses described below.





In light of the material weaknesses described below, we performed additional analysis and other post-closing procedures to ensure our financial statements were prepared in accordance with generally accepted accounting principles. Accordingly, we believe that the consolidated financial statements included in this report fairly present, in all material respects, our financial condition, results of operations and cash flows for the periods presented.





A material weakness is a control deficiency (within the meaning of the Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 2) or combination of control deficiencies, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected. Management has identified the following three material weaknesses that have caused management to conclude that, as of December 31, 2010, our disclosure controls and procedures were not effective at the reasonable assurance level:





1.   We do not have formalized documentation related to our internal control policies and procedures; however, there are informal policies and procedures that cover the recording and reporting of financial transactions. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act and was applicable to us for the year ending December 31, 2008. Management evaluated the impact of our failure to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.





2.   We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.





3.   We do not have sufficient personnel working on our accounting functions to ensure we can timely file our quarterly and annual reports, as indicated by the filing of this annual report after the original due date (but within the extension period). Management evaluated the impact of our lack of internal accounting personnel to ensure we can timely file our required quarterly and annual reports and has concluded that the control deficiency that resulted represented a material weakness.





To address these material weaknesses, management performed additional analyses and other procedures to ensure that the financial statements included herein fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented.





Remediation of Material Weaknesses





To remediate the material weaknesses in our disclosure controls and procedures identified above, we have continued to refine our internal procedures to begin to implement segregation of duties and to seek additional internal accounting personnel.




14







Management’s Report On Internal Control Over Financial Reporting
 
 We are responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, our principal executive and principal financial officers and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that:
 
 ·
Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;
 
 ·
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and
 
 ·
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.
 
 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.
 
 We assessed the effectiveness of our internal control over financial reporting as of December 31, 2010. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework.
 
 Based on its assessment, we concluded that, as of December 31, 2010, our internal control over financial reporting is not effective based on those criteria.
 
 This Annual Report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Our report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission.
  Changes in Internal Control over Financial Reporting
 
 Except as noted above, there were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


ITEM 9B - OTHER INFORMATION





There are no events required to be disclosed by the Item.





15





PART III





ITEM 10 - DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNACE





Directors and Executive Officers





The following table sets forth the names and ages of our current directors and executive officers, the principal offices and positions held by each person, and the date such person became a director or executive officer. Our executive officers are elected annually by the Board of Directors. The directors serve one year terms until their successors are elected. The executive officers serve terms of one year or until their death, resignation or removal by the Board of Directors. Unless described below, there are no family relationships among any of the directors and officers.





Name

Age

Position(s)Seong Yong Cho

42

Chief Executive Officer, President, and Director (2007)Seong Sam Cho

45

Chief Financial Officer, Secretary, and Director (2007)





Seong Yong Cho (Michael Cho) , 42, has been the Chief Executive Officer and a Director since the acquisition of JEI on October 31, 2007. He has served as the Chief Executive Officer of Joyon Entertainment Co., Ltd. since December 1999 and has been a director of Joytoto Co., Ltd. since December 2005. He served as the CEO of Joytoto Co., Ltd. from December 2005 to November 2006, and has been the COO of Joytoto Co., Ltd. from December 2006 to March 2008.





Prior to joining Joyon, Mr. Cho was a director of Sam Electronics from 1988 to 1996 and the CEO of Korea Licensing from September 1996 to March 2002. He has provided consulting services related to game development for EA/Accolade/Inforgrams, Samsung, SSangyong, Diamond Ads and other companies since 1988. In recognition of his services, he received the prize of the Ministry of Information and Communications for the Software Industry Development on December 2000 and the prize of the Prime Minister for the Software Industry Development on December 2001. Mr Cho’s qualification to serve as a director of the Company is based on his having served and founded several private and public companies in Korea involved in the computer software and hardware industry.





Seong Sam Cho (Sam Cho) , 45, has been the Chief Financial Officer, Secretary, and a Director since the acquisition of JEI on October 31, 2007. He has been the CEO of Joytoto Co., Ltd. since December 2006, and has been a director of Joytoto Co. Ltd. since December 2005. He served as the COO of Joytoto Co., Ltd. from December 2005 to November 2006. He has been the Chairman of the Board of Joyon Entertainment Co. Ltd., which is a subsidiary of Joytoto Co., since December 1999. Mr. Cho lectures on digital content and culture at the faculty of Sookmyung Women's University as a professor. He also participates actively as a member of the committee for Ministry of Information & Communication and Ministry of Culture & Tourism of the Korean government. Mr. Cho is a subcommittee member of the Federation of Korean Industries and Mirae Forum division of the game department. He has been engaged in the IT industry for approximately 20 years. He founded Sam Electronics Co., Ltd. in 1988. He received the prize of the Ministry of Information and Communication for the Software Industry Development on December 2001. Based on the foregoing, Mr. Cho is qualified to be a director of the Company.





Family Relationships





Seong Yong Cho and Seong Sam Cho are brothers. There are no other family relationships between or among any of the current directors, executive officers or persons nominated or charged by the Company to become directors or executive officers.





Involvement in Certain Legal Proceedings





None of our directors or executive officers has, during the past ten years:





·
been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offences);





·
had any bankruptcy petition filed by or against any business of which he was a general partner or executive officer, either at the time of the bankruptcy or within two years prior to that time;





·
been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities, futures, commodities or banking activities; or





·
been found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.





16





Other Directorships




None of our officers and directors are directors of any company with a class of securities registered pursuant to section 12 of the Exchange Act or subject to the requirements of section 15(d) of such Act or any company registered as an investment company under the Investment Company Act of 1940.





Director Independence





Our board of directors has determined that currently none of it members  qualify as “independent” as the term is used in Item 407 of Regulation S-K as promulgated by the SEC and in the listing standards of The Nasdaq Stock Market, Inc. - Marketplace Rule 4200.





Company Leadership Structure





Our Chief Executive Officer, Seong Yong Cho, is also the chairman of our board of directors.  Although we have not adopted a formal policy on whether the Chairman and Chief Executive Officer positions should be separate or combined, we have traditionally determined that it is in the best interests of the Company and its shareholders to partially combine these roles.  Due to the small size and early stage of the Company, we believe it is currently most effective to have the Chairman and Chief Executive Officer positions partially combined





Board Role in Risk Oversight





Our Board of Directors focus on the most significant risks facing our Company and our Company’s general risk management strategy, and also ensure that risks undertaken by our Company are consistent with the Board’s appetite for risk. While the Board oversees our company’s risk management, management is responsible for day-to-day risk management processes. We believe this division of responsibilities is the most effective approach for addressing the risks facing our company and that our Board leadership structure supports this approach.





Meetings and Committees of the Board of Directors




Our Board of Directors did not hold any formal meeting during the fiscal year ended December 31, 2010.




We currently do not maintain any committees of the Board of Directors. Given our size and the development of our business to date, we believe that the board through its meetings can perform all of the duties and responsibilities which might be contemplated by a committee.




Except as may be provided in our bylaws, we do not currently have specified procedures in place pursuant to which whereby security holders may recommend nominees to the Board of Directors.




Compliance with Section 16(a) of the Securities Exchange Act of 1934





Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s directors and executive officers and persons who own more than ten percent of a registered class of the Company’s equity securities to file with the SEC initial reports of ownership and reports of changes in ownership of Common Stock and other equity securities of the Company. Officers, directors and greater than ten percent shareholders are required by SEC regulations to furnish the Company with copies of all Section 16(a) forms they file.  To the best of the Company’s knowledge, officers, directors and greater than 10% shareholders have been in compliance with Section 16(a) of the Securities Exchange Act of 1934 for the year ended December 31, 2010.




Code of Ethics





We have not yet adopted a Code of Ethics although we expect to as we develop our infrastructure and business.





17





ITEM 11 - EXECUTIVE COMPENSATION





Executive Officers and Directors





The following tables set forth certain information about compensation paid, earned or accrued for services by (i) our Chief Executive Officer and (ii) all other executive officers who earned in excess of $100,000 in the fiscal year ended December 31, 2010 (“Named Executive Officers”):





Name and

Principal Position

Year

Salary

($)

Bonus

($)

Stock

Awards

($)*

Option Awards

($)*

Non-Equity

Incentive Plan Compensation

($)

Nonqualified Deferred Compensation

($)

All Other

Compensation

($)

Total

($)Seong Yong Cho


2009

24,000


-

-


-

-


-

-


24,000Chief Executive Officer,

President, and Director


2010Seong Sam Cho


2009

-


-

-


-

-


-

-


-Chief Financial Officer,

Secretary, and Director


2010Doo Ho Choi


2009

-


-

-


-

-


-

-


-Chief Operating Officer

and Director*


2010





*Mr. Choi resigned from all positions with the Company on October 13, 2010.





Employment Contracts





Through our subsidiary, Joyon Entertainment, Inc., we have employment agreements with all three of our executives. These employment agreements are all dated October 31, 2007.





Under the employment agreement with Seong Yong Cho, he served as our President and Chief Executive Officer. His employment agreement ran through October 31, 2010. In exchange for his services Seong Yong Cho received $12,000 per annum, which increased to $60,000 per annum starting April 1, 2009. He was eligible for a bonus, not to exceed one half the annual compensation, if approved by JEI’s Board of Directors. Seong Yong Cho was granted a total of 700,000 shares of our common stock from Joytoto Co., Ltd. and Joyon Entertainment Co., Ltd., under his employment agreement. However, those shares were subject to a repurchase right by the Company over thirty six (36) months beginning November 1, 2007, at a purchase price of $0.001 per share. The repurchase right expires as to 1/36 th of the shares for every month the employee is employed by us as President and Chief Executive Officer. Therefore, if Seong Yong Cho remains employed with us over the next thirty six (36) months, he will each own the shares free and clear of our repurchase right. These shares are also subject to a one year lock-up period during which they cannot be sold or otherwise transferred without restrictive legend.  The 36 month term expired on October 31, 2010 without the Company exericising its’ repurchase right.





Under the employment agreement with Seong Sam Cho, he served as our Chief Financial Officer. His employment agreement ran through October 31, 2010. In exchange for his services Seong Sam Cho received $12,000 per annum, which increased to $60,000 per annum starting April 1, 2009. He was eligible for a bonus, not to exceed one half the annual compensation, if approved by JEI’s Board of Directors. Seong Sam Cho was granted a total of 700,000 shares of our common stock from Joytoto Co., Ltd. and Joyon Entertainment Co., Ltd., under his employment agreement. However, those shares are subject to a repurchase right by the Company over thirty six (36) months beginning November 1, 2007, at a purchase price of $0.001 per share. The repurchase right expires as to 1/36 th of the shares for every month the employee is employed by us as Chief Financial Officer. Therefore, if Seong Sam Cho remains employed with us over the next thirty six (36) months, he will each own the shares free and clear of our repurchase right. These shares are also subject to a one year lock-up period during which they cannot be sold or otherwise transferred without restrictive legend.  The 36 month term expired on October 31, 2010 without the Company exercising its’ repurchase right.




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On March 21, 2011, the Company entered into three year employment agreements with each of Seong Yong Cho, its current President and Chief Executive Officer, and Seong Sam Cho,  its current Chief Financial Officer, respectively.  Pursuant to the terms of the employment agreements, Mr. Seong Yong Cho will continue to serve as President and Chief Executive Officer of the Company for an annual salary of $1.00 and Mr. Seong Sam Cho will continue to serve as Chief Financial Officer of the Company for an annual salary of $1.00.





Other Compensation





We do not have employment agreements with any of our other employees.





Director Compensation





We do not provide any compensation to our directors for serving as directors.





Outstanding Equity Awards at Fiscal Year-End





The following table sets forth certain information concerning outstanding stock awards held by the Named Executive Officers as of December 31, 2010:





Option Awards


Stock AwardsName

Number of Securities Underlying Unexercised Options

(#)

Exercisable


Number of

Securities

Underlying Unexercised

Options

(#)

Unexercisable


Equity

Incentive Plan Awards:

Number of Securities Underlying Unexercised Unearned

Options

(#)


Option Exercise Price


Option Expiration

Date


Number of Shares or Unites of

Stock That Have Not

Vested

(#)


Market Value of

Shares or Unites of

Stock That Have

Not Vested

($)


Equity Incentive

Plan

Awards: Number of Unearned Shares,

Units or Other

Rights That Have Not Vested

(#)


Equity Incentive

Plan

Awards: Market or Payout

Value of Unearned Shares,

Units or Other

Rights That Have Not Vested

($)Seong Yong Cho (1)


-



-



-



-



-



-



-



-



-Seong Sam Cho (1)


-



-



-



-



-



-



-



-



-Doo Ho Choi (2)


-



-



-



-



-



-



-



-



-





*Mr. Choi resigned from all positions with the Company on October 13, 2010





(1)
Seong Yong Cho and Seong Sam Cho were each granted a total of 700,000 shares of our common stock from Joytoto Co., Ltd. and Joyon Entertainment Co., Ltd., under their employment agreements. However, those shares were subject to a repurchase right by the Company over the next thirty six (36) months beginning November 1, 2007, at a purchase price of $0.001 per share. Such repurchase right expires as to 1/36 th of the shares for every month the employee is employed by the Company in their current capacity. Therefore, if the employee remains employed with us over the next thirty six (36) months, they will each own the shares free and clear of our repurchase right. The 36 month term expired on October 31, 2010 without the Company exericising its’ repurchase right. Therefore, these employees own 700,000 shares of our common stock free and clear from our repurchase right.  We have categorized the shares subject to this right of repurchase as unvested. These shares are also subject to a one year lock-up period during which they cannot be sold or otherwise transferred without restrictive legend.





(2)
Doo Ho Choi was granted a total of 8,000,000 shares of our common stock from Joytoto Co., Ltd. and Joyon Entertainment Co., Ltd., under his employment agreement. However, those shares were subject to a repurchase right by the Company over the next thirty six (36) months beginning November 1, 2007, at a purchase price of $0.001 per share. Such repurchase right expires as to 1/36 th of the shares for every month the employee is employed by the Company.





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ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS





The following table sets forth, as of March 30, 2011, certain information with respect to the Company’s equity securities owned of record or beneficially by (i) each Officer and Director of the Company; (ii) each person who owns beneficially more than 10% of each class of the Company’s outstanding equity securities; and (iii) all Directors and Executive Officers as a group.





Title of Class
Name and Address

of Beneficial Owner (3)

Amount and Nature of

Beneficial Ownership


Percent

of Class (1)Common Stock
Joytoto Co. Ltd. (4)(5)

3 FL Sungwoo Bldg

717-3 Sooseo-Dong

Kangnam Gu, Seoul, Korea

135-220


1,166,666



22.8
%Common Stock
Joyon Entertainment Co., Ltd.(4)(5)

3 FL Sungwoo Bldg

717-3 Sooseo-Dong

Kangnam Gu, Seoul, Korea

135-220


1,000,000



19.5
%Common Stock
Doo Ho Choi (5)


266,666



5.2
%Common Stock
Seong Yong Cho (2)


700,000



13.7
%Common Stock
Seong Sam Cho (2)


700,000



13.7
%Common Stock
All Directors and Officers

As a Group (2 persons)


1,400,000



27.3
%





(1)
Unless otherwise indicated, based on 5,121,689 shares of common stock issued and outstanding. Shares of common stock subject to options or warrants currently exercisable or exercisable within 60 days, are deemed outstanding for purposes of computing the percentage of the person holding such options or warrants, but are not deemed outstanding for the purposes of computing the percentage of any other person.





(2)
Indicates one of our officers or directors. Beneficial ownership by these officers does not include shares owned by Joytoto Co., Ltd. or Joyon Entertainment Co., Ltd.





(3)
Unless indicated otherwise, the address of the shareholder is c/o Pollex, Inc., 2005 De La Cruz Blvd. Suite 235, Santa Clara, CA 95050.





(4)
Joyon Entertainment Co., Ltd. is a wholly-owned subsidiary of Joytoto Co. Ltd., and as such, the shares of common stock held by both are attributed to the other. Combined, they own 42.3% of our outstanding common stock.(5)
Mr. Choi resigned from all positions with the Company on October 13, 2010.


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The issuer is not aware of any person who owns of record, or is known to own beneficially, ten percent or more of the outstanding securities of any class of the issuer, other than as set forth above. There are no classes of stock other than common stock issued or outstanding.





There are currently warrants outstanding to acquire an aggregate of 700,000 shares of our common stock at an exercise price of $3.00 per share which were issued to the holders of our Junior Convertible Debentures as part of the acquisition of JEI. There are also currently warrants outstanding to acquire an aggregate of 246,666 shares of our common stock at an exercise price of $10.50 per share which were issued to three consultants as part of the acquisition of JEI. Other than as set forth above, none of these parties owns, in the aggregate and including shares of our common stock that may be acquired upon exercise of their warrants, more than five percent (5%) of our common stock.





There are no current arrangements which will result in a change in control.





ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE





On August 11, 2010, the Company, along with its wholly owned subsidiary, Joyon Entertainment, Inc. (“JEI”) entered into a stock purchase agreement with Joytoto Co., Ltd. (“Joytoto Korea”), effective as of June 30, 2010.  JEI owns 100% of the issued and outstanding common stock of Joytoto America, Inc. (“JAI”).  Pursuant to the terms of the Agreement, the Company and JEI sold 100% of the issued and outstanding common stock of JAI to Joytoto Korea in consideration for the return and cancellation of 166,667 shares of the Company’s common stock held by Joytoto Korea.





On March 21, 2011, the Company entered into a Conversion and Release Agreement (the “Release Agreement”) with Joytoto Korea.  Pursuant to the terms of the Release Agreement, the Company issued 166,666 shares of its common stock to Joytoto Korea in consideration for the cancellation of $20,000 owed to Joytoto Korea by the Company.





ITEM 14 - PRINCIPAL ACCOUNTING FEES AND SERVICES





Audit Fees





During the years ended December 31, 2010 and 2009, Meyler & Co. billed us $32,000 and $49,510, respectively, in fees for professional services for the audit of our financial statements and review of financial statements included in our Form 10-Q’s, as applicable.





Audit - Related Fees





During the years ended December 31, 2010 and 2009, Meyler & Co. billed us $0 and $0, respectively, relating to procedures performed in connection with proxy and registration information filed with the SEC. There were no amounts billed related to any assurance and related services related to the performance of the audit or review of our financial statements.





Tax Fees





During the years ended December 31, 2010 and 2009, Meyler & Co. billed us $0 and $0, respectively, for professional services for tax preparation.





All Other Fees





During the years ended December 31, 2010 and 2009, Meyler & Co. did not bill us for any other fees.





Of the fees described above for the year ended December 31, 2010, 100% were approved by either the entire Board of Directors or the Audit Committee. Of the fees described above for year ended December 31, 2009, 100% were approved by either the entire Board of Directors or the Audit Committee. The Audit Committee’s pre-approval policies and procedures were detailed as to the particular service and the audit committee was informed of each service and such policies and procedures did not include the delegation of the audit committee’s responsibilities.




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PART IV





ITEM 15 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES





(b) Exhibits





3.1 (1)

Articles of Incorporation dated September 20, 20013.2 (2)

Articles of Amendment to Articles of Incorporation dated June 17, 20033.3 (3)

Certificate of Amendment to Articles of Incorporation dated January 7, 20053.4 (6)

Certificate of Amendment to Articles of Incorporation dated November 18, 20053.5 (4)

Certificate of Amendment to Articles of Incorporation dated Effective October 31, 20073.6 (1)

Bylaws of Web Views Corporation dated November 10, 2001





10.1 (5)

Stock Exchange Agreement, dated October 12, 200710.2 (5)

Agreement to Purchase Subsidiaries and Cancel Shares, dated October 12, 200710.3 (7)

License Agreement dated February 23, 200710.4 (7)

Lease Agreement dated February 26, 200710.5 (7)

Master License Agreement dated April 18, 200710.6 (7)

Exclusive Distributorship Agreement dated June 11, 200710.7 (8)

Employment Agreement with Seong Yong Cho dated October 31, 200710.8 (8)

Employment Agreement with Seong Yong Cho dated October 31, 200710.9 (8)

Employment Agreement with Doo Ho Choi dated October 31, 200710.10 (9)

Agreement to Manufacture, Supply and Market among Hyundai RFmon Corp and Joytoto USA, Inc. dated February 20, 200810.11 (10)

Stock Purchase Agreement10.12 (11)

Conversion and Release Agreement10.13 (11)

Employment Agreement with Seong Yong Cho10.14 (11)

Employment Agreement with Seong Sam Cho31.1

Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer31.2

Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer32.1

Chief Executive Officer Certification Pursuant to 18 USC, Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2

Chief Financial Officer Certification Pursuant to 18 USC, Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.





(1)
Incorporated by reference from our Registration Statement on Form 10SB12G filed with the Commission on July 23, 2002.(2)
Incorporated by reference from our Current Report on Form 8-K filed with the Commission on June 25, 2003.(3)
Incorporated by reference from our Current Report on Form 8-K filed with the Commission on January 7, 2005.(4)
Incorporated by reference from our Current Report on Form 8-K filed with the Commission on November 6, 2007.(5)
Incorporated by reference from our Current Report on Form 8-K filed with the Commission on October 31, 2007.(6)
Incorporated by reference from our Quarterly Report on Form 10-Q filed with the Commission on November 14, 2007.(7)
Incorporated by reference from our Current Report on Form 8-K filed with the Commission on December 14, 2007.(8)

(9)

(10)

(11)
Incorporated by reference from our Annual Report on Form 10-K filed with the Commission on April 16, 2008.

Incorporated by reference from our Annual Report on Form 10-K filed with the Commission on April 15, 2009.

Incorporated by reference from our Current Report on Form 8-K filed with the Commission on August 16, 2010.

Incorporated by reference from our Current Report on Form 8-K filed with the Commission on March 25, 2011.


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SIGNATURES





In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.





Pollex, Inc.Dated: March 31, 2011
By:
/s/ Seong Yong ChoSeong Yong ChoPresident, Chief ExecutiveOfficer and Director (Principal Executive Officer)Dated: March 31, 2011
By:
/s/ Seong Sam ChoSeong Sam ChoChief Financial Officer,Secretary and Director (Principal Financial and Accounting  Officer)





In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.





Dated: March 31, 2011
By:
/s/ Seong Yong ChoSeong Yong ChoPresident, Chief ExecutiveOfficer and Director (Principal Executive  Officer)Dated: March 31, 2011
By:
/s/ Seong Sam ChoSeong Sam ChoChief Financial Officer,Secretary and Director (Principal Financial and Accounting  Officer)











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