On December 28, 2010, FullCircle Entertainment, Inc. acquired certain commercial property located at 3898 Lafayette Road, Indianapolis, Indiana 46224. The property currently houses a 14 movie theatre complex, which is owned and operated by FullCircle Entertainment, Inc. and a grocery store, which is owned and operated by an independent third party, who has an existing lease with FullCircle Entertainment, Inc.
In December 2007 Mr. Frohreich was appointed as President and CEO of FullCircle Registry, Inc. Mr. Frohreich introduced a business plan to the directors and has since been finalizing those plans designing the infrastructure, locating additional talent and preparing the Form S-1 registration statement to issue preferred shares to fund the Company plans.
Late in 2007 and early 2008 insurance sales revenue began to come in as a result of our transition into the insurance business. The accounting process, revenue recognition, cost of sales, gross profit and operating expenses will fluctuate as we continue to evolve as an insurance agency. In late 2008 our insurance sales began to drop due to the impending economic situations. In addition, our main insurance company, AIG, and several other insurance companies received substantial negative press and many individuals began delaying the purchase of insurance products. In 2009, because of the lack of funding we put our insurance company activities on hold to preserve cash, which continued in 2010.
Revenues from FullCircle Prescription Services, Inc. are minimal because we are in the process of setting up that infrastructure and locating independent agents to offer our Rx services. Those marketing efforts are also on hold because of the lack of funding. We are not able to develop operational materials, brochures, mailings, training materials and additional web pages until funding is available from our preferred share offering.
During 2010 we incurred expenses of $97,428 in professional fees including auditing, database assessment, legal, accounting, IT services and web design fees.
On December 31, 2010, the Company had $5,200,016 in total liabilities. Current liabilities included $61,881 in accounts payable, $20,286 in accrued interest, $5,008 in accrued expenses, current note payable liabilities of $65,000 and current mortgage payable of $113,430.
By comparison on December 31, 2009, the Company had $618,598 in total liabilities. On December 31, 2009 liabilities included $62,067 in accounts payable, $85,675 in accrued interest, $2,292 in accrued expenses and $468,564 in current notes payable liabilities. Current notes payable included $65,000 in notes payable and $403,564 in notes payable to related parties.
Net cash used by operating activities for the twelve-month period ending December 31, 2010 was $160,353 compared to $120,240 used in the twelve-month period ending December 31, 2009. During the twelve-month period ending December 31, 2010, $10,000 was used by investing activities and $228,564 was used in financing activities. For the same period in 2009, $0 was used by investing activities and $100,000 was provided by financing activities.
During the twelve month period ended December 31, 2010, in an effort to secure additional operating capital and to pay down accounts payable and notes payable, the Company received $175,000 represented by eleven stock purchase agreements from stockholders of the Company. This offering was issued in January 2010 by the board of directors at $.04 per share.
During the twelve month period ended December 31, 2009 in an effort to secure additional operating capital and to pay down accounts payable and notes payable, the Company borrowed $30,000 represented by promissory note agreements from major stockholders of the Company. Each note, together with interest accrued thereon at the rate of two percent (2%) per annum, shall become due and payable in one lump sum on the anniversary of the note. The Notes were issued pursuant to an exemption from registration under Regulation S of the Securities Act of 1933, as amended.
On December 31, 2010 the company net worth was $531,824 as compared to a negative net worth of $315,365 on December 31, 2009. This represented an improvement of $847,189 in 2010.
On December 31, 2010 we signed a note agreement for $5,047,841, for Georgetown 14, a theater that was purchased on that day by our FullCircle Entertainment, Inc., company. Except as otherwise disclosed herein as of December 31, 2010, the Company had no other capital commitments. We are currently focused on developing revenues from our entertainment division, our future insurance agency operations and our future prescription services operations, and reducing debt through converting notes payable to common stock when our common stock price provides a reasonable conversion ratio. We may also seek funding from unencumbered securities purchases or from lenders offering favorable terms. At this time, we have no contracts, agreements, or understandings for additional funding, nor can any assurance be given that we will be able to obtain this capital on acceptable terms, if at all. In such an event, this may have a materially adverse effect on our business, operating results and financial condition. If the need arises, we may offer a private placement or attempt to obtain funding through the use of various types of short term funding, loans or working capital financing arrangements from financial institutions and or shareholders. No assurance can be given that we will be able to obtain the total capital necessary to fund our new business plans. In such an event, this may have a materially adverse effect on our business, operating results and financial condition.
Our prime focus is to offer preferred shares to bring in funding to develop the Company and move our business plan forward.