As of April 30, 2011, the Company had assets equal to $7,808, comprised exclusively of cash. This compares with assets of $4,060, comprised exclusively of cash, as of April 30, 2010. The Company’s current liabilities as of April 30, 2011 totaled $30,950 comprised of $10,950 of accounts payable and $20,000 due to a related party. This compares with total liabilities of $21,911 comprised exclusively of accounts payable, as of April 30, 2010. The Company can provide no assurance that it can continue to satisfy its cash requirements for at least the next twelve months.
The following is a summary of the Company's cash flows provided by (used in) operating, investing, and financing activities for the fiscal years ended April 30, 2011 and 2010.
As of and for the two year period ended April 30, 2011, our auditors have issued a going concern opinion on our financial statements.
For the fiscal year ended April 30, 2011, the Company had a net loss of $45,291 comprised exclusively of general and administrative expenses including legal, accounting, audit, and other professional service fees incurred in relation to the filing of the Company’s periodic reports on Form 10-K and Form 10-Q.
For the fiscal year ended April 30, 2010, the Company had a net loss of $103,350 comprised exclusively of general and administrative expenses including legal, accounting, audit, and other professional service fees incurred in relation to the filing of the Company’s periodic reports on Form 10-K and Form 10-Q.
We have audited the accompanying balance sheets of Prevention Insurance.com (“the Company”) as of April 30, 2011 and 2010 and the related statements of operations, changes in stockholders’ equity (deficit) and cash flows for the years then ended. 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 audit.
September 2009: Conversion of $400,000 note payable for 16,000 restricted common stock (post reverse stock split)
As of April 30, 2011, the Company is a shell company as defined in Rule 12b-2 of the Exchange Act. The Company’s business is to pursue a business combination through acquisition, or merger with, an existing company. No assurances can be given that the Company will be successful in locating or negotiating with any target company.
As of April 30, 2011, the Company recognizes compensation cost based upon the fair value of stock options at the grant date using the Black-Scholes pricing model.
During the years ended April 30, 2011 and 2010, the Company did not issue any shares for services nor did the Company issue any options as stock based compensation to any officers, directors, or non-employees.
As of April 30, 2011, the Company does not expect any of the recently issued accounting pronouncements to have a material impact on its financial condition or results of operations.
Effective April 27, 2011, the Company authorized a (1:100) reverse stock split and a change in par value to $0.0001 per common share. In addition, the par value of all the 10,000,000 shares of preferred stock authorized was changed to $0.0001.
On September 22, 2009, the Company issued 16,000 shares of restricted common stock, as adjusted for the reverse stock split effective April 27, 2011, as payment for the $400,000 note payable to Mr. Goldsmith. As of April 30, 2010, this transaction is being reflected on the Company’s balance sheet as a reclassification from a current liability to equity.
As of April 30, 2011, the Company’s Chief Executive Officer, Alan P. Donenfeld, as a beneficial owner for securities held by Paragon Capital LP, holds warrants that are exercisable into 1,750,000 common shares of the Company as adjusted for the reverse stock split effective April 27, 2011. The $185,000 paid by Paragon Capital LP for the right to exercise these warrants is reflected in the additional paid in capital on the Company’s balance sheet.
As of April 30, 2011, if Mr. Donenfeld and Paragon Capital LP exercised the warrants that have been granted, they would be required to pay $975,000, except for a cashless exercise right, as adjusted for the reverse stock split effective April 27, 2011.
As of April 30, 2011, the Company had a $20,000 demand note payable with no formal repayment terms to Paragon Capital LP.
As of April 30, 2011, the Company maintains office space in New York, New York with the Company’s majority shareholder at no cost to the Company. For the year ended April 30, 2011 and 2010, the rent expense was zero.
As of April 30, 2009, the Company recognized a liability of $400,000 due to Mr. Goldsmith as a result of the transactions that took place on February 5, 2008.
On March 8, 2010, the Company, Paragon Capital LP and Mr. Goldsmith entered into an agreement whereby the Company paid Mr. Goldsmith $65,000. Paragon Capital LP transferred to Mr. Goldsmith its warrant issued April 30, 2008 which was due April 30, 2010 to buy 100,000 shares of common stock with an exercise price of $1.00, as adjusted for the reverse stock split effective April 27, 2011. This agreement relinquished Paragon Capital LP’s requirement to issue 40,000 warrants as adjusted for the reverse stock split effective April 27, 2011) to Mr. Goldsmith. The Company extended the warrant’s maturity date from April 30, 2010 to April 30, 2012.
In September 2009, the Company issued 16,000 shares of restricted common stock as adjusted for the reverse stock split effective April 27, 2011 to Mr. Goldsmith as payment for the $400,000 note payable.
The following table summarizes information about the Company's common stock warrants outstanding as of April 30, 2011.
As of April 30, 2011, Paragon Capital LP, holds warrants that are exercisable into 1,750,000 common shares of the Company at an average exercise price of $.56 per share post-reverse split effective April 27, 2011, except for a cashless exercise provision. At the sole discretion of the warrant holder, there is a cashless exercise provision within the warrant agreements.
As of April 30, 2011, Mr. Goldsmith holds warrants that are exercisable into 100,000 common shares of the Company at an exercise price of $1.00 per share post-reverse stock split effective April 27, 2011. Pursuant to the agreement with Mr. Goldsmith of March 8, 2010, the exercise period for the warrants that Mr. Goldsmith holds has been extended to April 2012.
As of April 30, 2011, the Company is a shell company as defined in Rule 12b-2 of the Exchange Act. The Company’s current business is to pursue a business combination through acquisition, or merger with, an existing company. The Company’s ability to continue as a going concern is dependent upon its ability to develop additional sources of capital, locate and complete a merger with another company and ultimately achieve profitable operations. No assurances can be given that the Company will be successful in locating or negotiating with any target company
As of the date the financial statements were available to be issued, there are no subsequent events that are required to be recorded or disclosed in the accompanying financial statements as of and for the year ended April 30, 2011.