As filed with the Securities and Exchange Commission on January 17, 2013
An Exhibit List can be found on page II-2.
Registration No. ___________
SECURITIES AND EXCHANGE COMMISSION
Washington DC 20549
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization)
(Primary Standard Industrial Classification Code Number)
(I.R.S. Employer Identification Number)
15500 SW Jay St. #81704
Beaverton, Oregon 97006-6018
Phone: (855) 222-1114
(Address, including zip code, and telephone number,
including area code, of registrant’s principal executive offices)
c/o Delaware Intercorp, Inc.
113 Barksdale Professional Center
Newark, DE 19711
Phone: (302) 266-9367
Fax: (302) 266-9940
(Address, including zip code, and telephone number,
including area code, of agent for service)
Law Offices of Jonathan D. Strum
5638 Utah Avenue NW
Washington DC 20015
Ph: (202) 362-9027
Fax: (202) 362-9037
As soon as practicable after the effective date of this registration statement
(Approximate date of commencement of proposed sale to the public)
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: x
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting Company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting Company” in Rule 12b-2 of the Exchange Act. (Check one)
Calculation of Registration Fee
(1) The offering price has been arbitrarily determined by the Company and bears no relationship to assets, earnings, or any other valuation criteria. No assurance can be given that the shares offered hereby will have a market value or that they may be sold at this, or at any price.
(2) Estimated solely for the purpose of calculating the registration fee based on Rule 457 (o).
(3) The offering will conclude at the earlier of the sale for all shares or 180 days after this registration statement becomes effective with the Securities and Exchange Commission.
The Registrant hereby amends this Registration Statement on such date as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that the Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission acting pursuant to said Section 8(a) may determine.
UP TO 400,000 SHARES OF COMMON STOCK
Prior to this registration, there has been no public trading market for the common stock of Lollipop Corporation (“LPC”) and it is not presently traded on any market or securities exchange. Up to 400,000 shares of common stock are being offered for sale by the Company to the public.
The price per share will be $0.25 for the duration of the offering. The offering will conclude at the earlier of the sale for all shares or 180 days after this registration statement becomes effective with the Securities and Exchange Commission, unless extended for an additional period of 90 days by us.
The offering is being conducted on a self-underwritten, best efforts basis, which means our President Yisrael Meir Fromer and our Secretary Malka Dahan-Asulin will be responsible for the sale of the shares. This prospectus will permit our officers to sell the shares directly to the public, with no commission or other remuneration payable to them for any shares they may sell. The shares being offered by us though our Directors are pursuant to an exemption as a broker/dealer under Rule 3a 4-1 of the Securities Exchange Act of 1934. We are offering the shares from time to time on a continuous basis, for up to 180 days from the date that this Registration Statement becomes effective, but we may terminate the offering at any time. There is no minimum number of shares that we must sell and we will retain the proceeds from the sale of any of the offered shares that are sold. We will not employ an escrow account and will retain and use the proceeds from the sale of any of the offered shares that are sold. Because we may utilize all funds as they are received, if we raise insufficient funds to execute our business plan, early investors could lose all their investment.
Investing in our securities involves a high degree of risk. See “Risk Factors” beginning on page _ of this prospectus for a discussion of information that should be considered in connection with an investment in our securities.
Prior to this registration, there has been no public trading market for the common stock of Lollipop Corporation and it is not presently traded on any market or securities exchange. After the effective date of the Registration Statement relating to this Prospectus, we hope to have a market maker file an application with the Financial Industry Regulatory Authority (FINRA) for our common stock to be eligible for quotation on the Over The Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application. There is no assurance that a market maker will file an application for our stock to be eligible for quotation on the Over The Counter Bulletin Board, or that such an application, if filed, will be accepted. Even if an application by a market maker for our common stock to be eligible for quotation on the Over The Counter Bulletin Board is filed and accepted, a market for our common stock may not develop or be sustained.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of the prospectus. Any representation to the contrary is a criminal offense. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
Under the recently enacted JOBS Act of 2012 (April 5, 2012) , the Company is deemed to be an “emerging growth” company (revenue under $1 Billion) will be subject to reduced public company reporting requirements. See "The Company: Jumpstart Our Business Startups Act" contained herein. We have elected to opt-in and make use of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act of 2012. This election is irrevocable.
Lollipop Corporation is a development stage company. We have generated no revenues from operations since our inception. This prospectus shows the actions we believe that will lead to the creation of our business and operations. However, as of the date of this prospectus our auditors stated that the Company has solely incurred expenses and has no operating income, which raise substantial doubt about its ability to continue as a going concern. This going concern opinion is due to the fact that we do not have enough material assets, or a source of revenue sufficient to cover our operation costs. The Company is highly dependent upon the raising of additional capital through the sale of our common stock in order to implement its business plan. The ability of the Company to continue as a going concern is dependent on raising capital to fund its business plan and ultimately to attain profitable operations.
As of the date of this prospectus there is currently no market for our shares.
The offering will conclude at the earlier of the sale for all shares or 180 days after this registration statement becomes effective with the Securities and Exchange Commission (unless extended for an additional 90 days).
The date of this prospectus is __________ _, 2013.
The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
DEALER PROSPECTUS DELIVERY OBLIGATION
Until , (90 days after the effective date of this prospectus) all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.
This summary provides an overview of the most significant information contained elsewhere in this prospectus. It does not contain all the detailed information you should consider before making a decision to purchase the shares we are offering. You should very carefully and thoroughly read the more detailed information in this prospectus and review our financial statements contained herein.
Summary Information about Lollipop Corporation
Lollipop Corporation (“LPC, “we”, “the Company”) was incorporated in the State of Delaware as a for-profit Company on November 17, 2011 and established a fiscal year end of December 31. We are a development-stage Company that are committed to provide on our website nutritional supplement solutions for amateur and professional athletes outside of the United States , by developing products for distribution which enable easy intake of vitamins, calories and other essential elements to athletes while exercising or competing. The sports nutrition industry has reached a stage where the focus needs to be on acquiring new consumers while retaining existing ones. With new products and variants being launched frequently, brands are fighting for both shelf space and consumer attention. The wide range of choices in terms of flavor, form, size, and price is encouraging consumers to shift from product to product, trying out tastes and other benefits. As a result, most participants in the sports/fitness nutrition industry - with the exception of the top ten companies, which have strong product profiles - find themselves struggling to retain customer loyalty. Developing stronger brands with distinct identities and clear-cut positioning holds the key to overcome this challenge.
We have no arrangements in place with any of the companies to the supply, manufacture or distribution of such products. Nor do we have any agreements in place with any nutritionists, marketing specialist or other companies with whom will want to have an agreement.
We have a mailing address at 15500 SW Jay St.#81704 Beaverton, Oregon 97006-6018, our telephone is 855 222-1114. Except for the mail address and the use of a room at the premises of our President located at 7 Kaufman Street Jerusalem Israel for our operations in Israel, the Company does not own or rent any property. We expect that once our business is able to expand and we have the financial resources then we will seek additional rental locations for our operations, including in Israel.
As of January 15, 2013, there was US$13,983 of cash on hand in the corporate bank account. As of January 15, 2013, we raised $14,000 through the sale of our common stock to our Officers and Directors, We currently have liabilities of US$ 25, represented by expenses accrued during its start-up. In addition, the Company anticipates incurring costs associated with this offering totaling approximately $11,500. As of the date of this prospectus, we have generated no revenues from our business operations. The following financial information summarizes the more complete historical financial information as indicated on the audited financial statements of the Company filed with this prospectus.
As of the date of this filing, the Company has generated no revenues and has not entered into any agreement, arrangement or understanding with any retailers for its services, and failure to raise funds will require the Company to cease operations. The Company’s officers and directors, Mr. Yisrael Meir Fromer and Ms. Malka Dahan-Asulin have indicated that they may lend the Company funds in the form of a non-secured loan to meet its short to medium term (up to 12 months) financial obligations, but there is no contract in place or written agreement between the Company and its officers and directors and there can be no assurances that they will assist the Company in meeting its short term financial obligations.
We have no plans or intention to be acquired or to merge with an operating company. Additionally, there are no plans to enter into a change of control or similar transaction or change the management of the company.
Summary of the Offering by the Company
We have 875,000 shares of common stock issued and outstanding and we are registering an additional 400,000 shares of common stock for offering to the public. We will endeavor to sell all 400,000 shares of common stock after this registration becomes effective. The price at which we will offer these shares is fixed at $0.25 per share for the duration of the offering. We will receive all proceeds from the sale of the common stock.
You should rely only upon the information contained in this prospectus. We have not authorized anyone to provide you with information different from that which is contained in this prospectus. The Company is offering to sell shares of common stock and seeking offers only in jurisdictions where offers and sales are permitted. The information contained in here is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the common stock.
The following summary financial information for the periods stated summarizes certain information from our financial statements included elsewhere in this prospectus. You should read this information in conjunction with Management's Plan of Operations, the financial statements and the related notes thereto included elsewhere in this prospectus.
As shown in the financial statements accompanying this prospectus, LPC has had no revenues to date and has incurred only losses since its inception. The Company has had no operations and has been issued a “going concern” opinion from their accountants, based upon the Company’s reliance upon the sale of our common stock as the sole source of funds for our future operations.
Please consider the following risk factors and other information in this prospectus relating to our business and prospects before deciding to invest in our common stock.
This offering and any investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and all of the information contained in this prospectus before deciding whether to purchase our common stock. If any of the following risks actually occur, our business, financial condition and results of operations could be harmed. The trading price of our common stock could decline due to any of these risks, and you may lose all or part of your investment.
The Company considers the following to be the most significant material risks to an investor regarding this offering. LPC should be viewed as a high-risk investment and speculative in nature. An investment in our common stock may result in a complete loss of the invested amount. Please consider the following risk factors before deciding to invest in our common stock.
INVESTING IN THE COMPANY IS A HIGHLY SPECULATIVE INVESTMENT AND COULD RESULT IN THE ENTIRE LOSS OF YOUR INVESTMENT
A purchase of the offered shares is highly speculative and involves significant risks. The offered shares should not be purchased by any person who cannot afford the loss of their entire investment. The business objectives of the company are also speculative as there is no other nutritious lollipop in the market, and it is possible that we could be unable to satisfy our potential customers. The company’s shareholders may be unable to realize a substantial return on their purchase of the offered shares, or any return whatsoever, and may lose their entire investment. For this reason, each prospective purchaser of the offered shares should read this prospectus and all of its exhibits carefully and consult with their attorney, business and/or investment advisor.
A market for our common stock may never develop. We intend to contact an authorized OTC Bulletin Board market-maker for sponsorship of our securities on the OTC Bulletin Board upon the effectiveness of the registration statement of which this prospectus forms a part. However, our shares may never be traded on the bulletin board, or, if traded, a public market may not materialize. If our common stock is not traded on the bulletin board or if a public market for our common stock does not develop, investors may not be able to re-sell the shares of our common stock that they have purchased and may lose all of their investment.
BECAUSE OUR AUDITORS HAVE ISSUED A GOING CONCERN OPINION REGARDING OUR COMPANY, THERE IS A RISK ASSOCIATED WITH INVESTING IN OUR BUSINESS
Our auditors have issued a going concern opinion regarding our Company, as we do not have material assets, nor do we have operations or a source of revenue sufficient to cover our operation costs. The Company has a net operating loss accumulated since inception (November 17, 2011) through December 31, 2012 of $42. The Company will be dependent upon the raising of additional capital through placement of our common stock in order to implement its business operations, or merge with an operating company.
There is no assurance that the Company will be successful in either situation in order to continue as a going concern. The Officers and Directors have not committed to advancing certain operating costs of the Company.
The ability of the Company to continue is dependent on raising capital to fund its business plan and ultimately to attain profitable operations. Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amount and classification of liabilities that might cause results from this uncertainty. The Company is funding its initial operations by issuing paid for Founder’s shares. As of January 15, 2013, the Company had issued 875,000 Founder’s shares at $0.016 per share for net funds to the Company of $14,000.
We reserve the right to seek additional funds through private placements of our common stock and/or through debt financing. Our ability to raise additional financing is unknown. We do not have any formal commitments or arrangements for the advancement or loan of funds. For these reasons, our auditors stated in their report that they have substantial doubt we will be able to continue as a going concern. As a result, there is an increased risk that you could lose the entire amount of your investment in our company.
AS WE DO NOT HAVE AN ESCROW OR TRUST ACCOUNT FOR INVESTORS' SUBSCRIPTIONS, IF WE FILE FOR OR ARE FORCED INTO BANKRUPTCY PROTECTION, INVESTORS WILL LOSE THEIR ENTIRE INVESTMENT
Invested funds for this offering will not be placed in an escrow or trust account and may be used as received. Accordingly, if we file for bankruptcy protection, or a petition for involuntary bankruptcy is filed by creditors against us, your funds will become part of the bankruptcy estate and administered according to the bankruptcy laws. As such, you will lose your investment and your funds will be used to pay creditors.
BUYERS WILL PAY MORE FOR OUR COMMON STOCK THAN THE PRO RATA PORTION OF THE ASSETS ARE WORTH; AS A RESULT, INVESTING IN OUR COMPANY MAY RESULT IN AN IMMEDIATE LOSS
The offering price and other terms and conditions regarding the company’s shares have been arbitrarily determined and do not bear any relationship to assets, earnings, book value or any other objective criteria of value. Additionally, no investment banker, appraiser or other independent third party has been consulted concerning the offering price for the shares or the fairness of the offering price used for the shares.
The arbitrary offering price of $0.25 per common share as determined herein is substantially higher than the net tangible book value per share of our common stock. Our assets do not substantiate a share price of $0.25. This premium in share price applies to the terms of this offering and does not attempt to reflect any forward looking share price subsequent to the company obtaining a listing on any exchange, or becoming quoted on the OTC Bulletin Board.
THE COMPANY’S MANAGEMENT COULD ISSUE ADDITIONAL SHARES, SINCE THE COMPANY HAS 180,000,000 AUTHORIZED SHARES, DILLUTING THE CURRENT SHARE HOLDERS’ EQUITY
The company has 180,000,000 authorized shares, of which only 875,000 are currently issued and outstanding and only 1,275,000 will be issued and outstanding after this offering terminates. The company’s management could, without the consent of the existing shareholders, issue substantially more shares, causing a large dilution in the equity position of the company’s current shareholders. Additionally, large share issuances would generally have a negative impact on the company’s share price. It is possible that, due to additional share issuance, you could lose a substantial amount, or all, of your investment.
IN THE EVENT THAT OUR SHARES ARE TRADED, THEY MAY TRADE UNDER $5.00 PER SHARE AND THUS WILL BE A PENNY STOCK. TRADING IN PENNY STOCKS HAS MANY RESTRICTIONS AND THESE RESTRICTIONS COULD SEVERLY AFFECT THE PRICE AND LIQUIDITY OF OUR SHARES
In the event that our shares are traded, and our stock trades below $5.00 per share, our stock would be known as a “penny stock”, which is subject to various regulations involving disclosures to be given to you prior to the purchase of any penny stock. The U.S. Securities and Exchange Commission (the “SEC”) has adopted regulations which generally define a “penny stock” to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. Depending on market fluctuations, our common stock could be considered to be a “penny stock”. A penny stock is subject to rules that impose additional sales practice requirements on broker/dealers who sell these securities to persons other than established customers and accredited investors. For transactions covered by these rules, the broker/dealer must make a special suitability determination for the purchase of these securities. In addition, he must receive the purchaser’s written consent to the transaction prior to the purchase. He must also provide certain written disclosures to the purchaser. Consequently, the “penny stock” rules may restrict the ability of broker/dealers to sell our securities, and may negatively affect the ability of holders of shares of our common stock to resell them. These disclosures require you to acknowledge that you understand the risks associated with buying penny stocks and that you can absorb the loss of your entire investment. Penny stocks are low priced securities that do not have a very high trading volume. Consequently, the price of the stock is often volatile and you may not be able to buy or sell the stock when you want to.
SINCE OUR OFFICERS AND DIRECTORS CURRENTLY OWN 100% OF THE OUTSTANDING COMMON STOCK, INVESTORS MAY FIND THAT THEIR DECISIONS ARE CONTRARY TO THEIR INTERESTS
Our Officers and Directors, own 100% of the outstanding shares and will own approximately 69% after this offering is completed. Accordingly, they will have full control in determining the outcome of all corporate transactions or other matters, including mergers, consolidations and the sale of all or substantially all of our assets, and also the power to prevent or cause a change in control. While we have no current plans with regard to any merger, consolidation or sale of substantially all of our assets, the interests of our officers and directors may still differ from the interests of the other stockholders.
Accordingly, no person should purchase the offered shares unless willing to entrust all aspects of management to the Officers and Directors, or their successors. Potential purchasers of the offered shares must carefully evaluate the personal experience and business abilities of our management.
SINCE WE ARE A DEVELOPMENT STAGE COMPANY, WE DO NOT ANTICIPATE PAYING DIVIDENDS IN THE FORSEEABLE FUTURE AND AS SUCH OUR STOCKHOLDERS WILL NOT BE ABLE TO RECEIVE A RETURN ON THEIR INVESTMENT UNLESS THEY SELL THEIR SHARES OF COMMON STOCK
We do not anticipate paying dividends on our common stock in the near future, but plan rather to retain earnings, if any, for growth and expansion of our business. Unless we pay dividends, our stockholders will not be able to receive a return on their shares unless they sell them. There is no assurance that stockholders will be able to sell shares when desired.
SINCE WE ANTICIPATES OPERATING EXPENSES WILL INCREASE PRIOR TO EARNING REVENUE, WE MAY NEVER ACHIEVE PROFITABILITY
We anticipate increases in our operating expenses, without realizing any revenues from its business activities. Within the next 12 months, we will have estimated costs of $100,000 to make our company operational and there is no history upon which to base any assumption as to the likelihood that the we will prove successful. We cannot provide investors with any assurance that our products will attract customers; generate any operating revenue or ever achieve profitable operations. If we are unable to address these risks, there is a high probability that our business can fail, which will result in the loss of your entire investment.
THIS OFFERING IS AIMING TO RAISE $100,000 WITH WHICH WE BELIEVE IS THE IDEAL AMOUNT TO START OUR OPERATION UNTIL THE COMPANY BEGINS TO GENERATE REVENUE OR ACQUIRE FINANCING RESOURCES. EVEN IF WE SUCCEED TO RAISE THIS ENTIRE AMOUNT, FAILING TO MANAGE IT PROPERLY OR IF IT IS NOT ENOUGH UNTIL THE COMPANY CAN OPERATE BY ITSELF MAY RESULT IN PERIODIC INTERRUPTIONS OR BUSINESS FAILURE
The amount of $100,000 was estimated (see section “Plan of Operation” on page 22) using our best efforts and information available in order to create the condition to start the operation of the Company. In the case of our estimation fails, we will need to look for more financial resources. If we cannot raise more investments to fund the start of our operation, we may be forced to periodically interrupt our activities or even stop it at all.
Even if all the $100,000 is raised, the success to start our operation will depend on our ability to manage and perform all the planned actions within this budget and the planned time. Considering that Company’s Officers and Directors do not have specific experience in the distribution of sports nutritional supplements and in managing a company like Lollipop Corporation, there is a possibility that what was planned cannot be fully accomplished, due to mistakes that may occur due to their specific inexperience. Consequently, it may lead to the need to acquire more investments or even hire better qualified third party consultants. If we cannot raise more funds or hire the required professionals, we may be forced to periodically interrupt our activities or even stop it at all.
For this reason, each prospective purchaser of the offered shares could lose a substantial amount, or all, of his or her investment.
IF WE DO NOT OBTAIN ADEQUATE FINANCING, OUR BUSINESS WILL FAIL, RESULTING IN THE COMPLETE LOSS OF YOUR INVESTMENT
Because our Officers and Directors may be unwilling or unable to loan or advance any additional capital to us, we believe that if we do not raise all the required capital within 12 months of the effective date of this registration statement, we may be required to suspend or cease the implementation of our business plans. Due to the fact that there is no minimum and no refunds on sold shares, you may be investing in a company that will not have the funds necessary to develop its business strategies. As such we may have to cease operations and you could lose your entire investment.
If we are not successful in earning revenues once we have started our sales activities, we may require additional financing to sustain business operations. Currently, we do not have any arrangements for financing and can provide no assurance to investors that we will be able to obtain financing when required. Obtaining additional financing would be subject to a number of factors, including the Company’s ability to attract customers. These factors may have an effect on the timing, amount, terms or conditions of additional financing and make such additional financing unavailable to us.
No assurance can be given that the Company will obtain access to capital markets in the future or that financing, adequate to satisfy the cash requirements of implementing our business strategies, will be available on acceptable terms. The inability of the Company to gain access to capital markets or obtain acceptable financing could have a material adverse effect upon the results of its operations and upon its financial conditions.
SINCE WE ARE A NEW COMPANY AND LACK AN OPERATING HISTORY, WE FACE A HIGH RISK OF BUSINESS FAILURE WHICH WOULD RESULT IN THE LOSS OF YOUR INVESTMENT
We are a development stage company formed recently to carry out the activities described in this prospectus and thus has only a limited operating history upon which an evaluation of its prospects can be made. We were incorporated on November 17, 2011 and to date we have been involved primarily in the creation of our business plan and we have transacted no business operations. Thus, there is no internal or industry-based historical financial data upon which to estimate the company’s planned operating expenses.
The company expects that its results of operations may also fluctuate significantly in the future as a result of a variety of market factors, including, among others, the dominance of other companies offering similar services and products, the entry of new competitors into the sports nutritional supplements, our ability to attract, retain and motivate qualified personnel, the initiation, renewal or expiration of our customer base, pricing changes by the company or its competitors, specific economic conditions in the nutritional sports market and general economic conditions. Accordingly, our future sales and operating results are difficult to forecast.
BECAUSE WE ARE SMALL AND DO NOT HAVE MUCH CAPITAL, OUR MARKETING CAMPAIGN AND SALES STRATEGY MAY NOT BE ENOUGH TO ATTRACT SUFFICIENT CLIENTS AND PARTNERS TO OPERATE PROFITABLY. IF WE DO NOT MAKE A PROFIT, WE MAY HAVE TO SUSPEND OR CEASE OPERATIONS
Due to the fact we are small and do not have much capital, we must limit our marketing and sales activities and may not be able to make our portfolio of products and services known to potential customers and partners. Because we will be limiting our marketing and sales activities, we may not be able to attract enough customers and partners to operate profitably. If we cannot operate profitably, we may have to suspend or cease operations.
AS THE COMPANY’S OFFICERS AND DIRECTORS HAVE OTHER OUTSIDE BUSINESS ACTIVITIES, THEY MAY NOT BE IN A POSITION TO DEVOTE A MAJORITY OF THEIR TIME TO THE COMPANY, WHICH MAY RESULT IN PERIODIC INTERRUPTIONS OR BUSINESS FAILURE
Mr. Yisrael Meir Fromer is our President and is a director. Ms. Malka Dahan-Asulin is our Secretary and is a Ddriector. Both Mr. Fromer and Ms. Dahan-Asulin have other business interests and each currently devotes approximately 10-15 hours per week to our operations. Our operations may be sporadic and occur at times which are not convenient to either Mr. Fromer or Ms. Dahan-Asulin, which may result in periodic interruptions or suspensions of our business plan. If the demands of the Company’s business require the full business time of our Officers and Directors, they are prepared to adjust their timetables to devote more time to the Company’s business. However, they may not be able to devote sufficient time to the management of the Company’s business, which may result in periodic interruptions in implementing the Company’s plans in a timely manner. Such delays could have a significant negative effect on the success of the business.
KEY MANAGEMENT PERSONNEL MAY LEAVE THE COMPANY WHICH COULD ADVERSELY AFFECT THE ABILITY OF THE COMPANY TO CONTINUE OPERATIONS
The Company is entirely dependent on the efforts of its Officers and Directors. The departure of one or both or or the loss of any other key personnel in the future could have a material adverse effect on the business. There is no guarantee that replacement personnel, if any, will help the Company to operate profitably. The Company does not maintain key person life insurance on its Officers and Directors.
IT MAY BE IMPOSSIBLE TO HIRE ADDITIONAL EXPERIENCED PROFESSIONALS, IF NECESSARY, AND WE MAY HAVE TO SUSPEND OR CEASE OPERATIONS
Since our management does not have prior experience in the selling of products and services for the sports nutritional market, we may need to hire additional experienced personnel to assist us with the operations. If we need the additional experienced personnel and we cannot hire them, we could fail in our plan of operations and have to suspend operations or cease them entirely.
Moreover, as planned, we anticipate the need of contracting nutritionists to help us in the development of sports nutritional supplements and information concerning the distribution of such products, as our Officers and Directors have limited experience in this field. If we do not succeed in finding, contracting or retaining skilled nutritionists and sports enthusiasts, an important part of our business will be affected, which may lead to the suspension of our operation or the cession of it completely.
SINCE OUR OFFICERS AND DIRECTORS RESIDE IN ISRAEL, THE COMPANY MAY FACE SOME DIFFICULTIES DEVELOPING ITS IMPORTING BUSINESS
Since our management’s residence is in the city of Jerusalem, in Israel, their ability to develop relationships with foreign manufactures of sports nutritional products is limited. Due to this fact, all the contact with our possible suppliers and partners will not be in person and that can negatively affect the results of a partnership or business negotiation. If we cannot establish the proper relationship with our possible suppliers and partners, our business will fail, resulting in the total loss of our shareholders investments.
WE MAY NOT BE ABLE TO FIND SUITABLE SUPPLIERS AND CLOSE PARTNERSHIPS REQUIRED FOR OUR BUSINESS TO WORK.
An important part of our business concept and of revenue generation will rely on our ability to select and retain sports nutritional supplement suppliers. If we are unable to find suitable suppliers and we do not have the ability to have profitable partnerships with them, our operation would be affected. Therefore, our operation, revenue and financial success could be severely affected, resulting in the suspension of our operation or the cession of it completely.
BECAUSE OUR MANAGEMENT IS INEXPERIENCED IN OPERATING A SPORTS NUTRITION DISTRIBUTION NETWORK, OUR BUSINESS PLAN MAY FAIL
Our management does not have any specific training in running a business for distributing and for selling sports nutrionalproducts. With no direct training or experience in this area, our management may not be fully aware of many of the specific requirements related to working within this industry. As a result, our management may lack certain skills that are advantageous in managing our company. Consequently, our operations, earnings, and ultimate financial success could suffer irreparable harm due to management’s lack of experience in this industry.
THE COMPANY CURRENTLY HAS NO PRODUCTS OR SERVICES. WHEN WE DO HAVE PRODUCTS AND SERVICES OUR NAME WILL HAVE LITTLE, IF ANY, NAME RECOGNITION. AS A RESULT, WE MAY BE UNABLE TO GENERATE REVENUES, WHICH WILL REDUCE THE VALUE OF YOUR INVESTMENT
Because we are a new company with no products or services and we have not conducted advertising, there is little or no recognition of our name. As a result, consumers may search for products and services other than ours that have brand recognition in the market and we may be unable to generate sufficient revenues to meet our expenses or meet our business plan objectives, which will reduce the value of your investment.
OUR OFFICERS AND DIRECTORS, ARE LOCATED IN ISRAEL. ANY ATTEMPT TO ENFORCE LIABILITIES UPON THEM UNDER THE U.S. SECURITIES AND BANKRUPTCY LAWS MAY BE DIFFICULT.
Since our Officers and Directors, are located in Israel, any attempt to enforce liabilities upon such individual under the U.S. securities and bankruptcy laws may be difficult.
In accordance with the Israeli Law on Enforcement of Foreign Judgments, 5718-1958, and subject to certain time limitations (the application to enforce the judgment must be made within five years of the date of judgment or such other period as might be agreed between Israel and the United States), an Israeli court may declare a foreign civil judgment enforceable if it finds that:
In general, an obligation imposed by the judgment of a United States court is enforceable according to the rules relating to the enforceability of judgments in Israel, and a United States court is considered competent to render judgments according to the laws of private international law in Israel.
Furthermore, Israeli courts may not adjudicate a claim based on a violation of U.S. securities laws if the court determines that Israel is not the most appropriate forum in which to bring such a claim. Even if an Israeli court agrees to hear such a claim, it may determine that Israeli law, not U.S. law, is applicable to the claim. If U.S. law is found to be applicable, the content of applicable U.S. law must be proven as a fact, which can be a time-consuming and costly process.
Since our Directors and Officers do not reside in the United States it may be difficult for courts in the United States to obtain jurisdiction over our foreign assets or persons, and, as a result, it may be difficult or impossible for you to enforce judgments rendered against us or our Directors or Officers in United States courts. Thus, investing in us may pose a greater risk because should any situation arise in the future in which you have a cause of action against these persons or us, you may face potential difficulties in bringing lawsuits or, if successful, in collecting judgments against these persons or us.
WE ARE AN ‘EMERGING GROWTH CONMPANY” AND WE INTENED TO TAKE ADVANTAGE OF REDUCED DISCLOSURE AND GOVERNANCE REQUIREMENTS APPLICABLE TO EMERGING GROWTH COMPANIES, WHICH COULD RESULT IN OUR STOCK BEING LESS ATTRACTIVE TO INVESTORS.
We are an "emerging growth company," as defined in the Jumpstart Our Business Startups Act of 2012, which we refer to as the JOBS Act, and we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile. We expect to take advantage of these reporting exemptions until we are no longer an emerging growth company, which in certain circumstances could be for up to five years.
THE COMPANY’S ELECTION TO TAKE ADVANTAGE OF THE JOBS ACT’S EXTENDED ACCOUNTING TRANSITION PERIOD MAY NOT MAKE ITS FINANCIAL STATEMENTS EASILY COMPARABLE TO OTHER COMPANIES
Pursuant to the JOBS Act of 2012, as an emerging growth company the Company can elect to take advantage of the extended transition period for any new or revised accounting standards that may be issued by the PCAOB or the SEC. The Company has elected take advantage of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the standard for the private company. This may make comparison of the Company's financial statements with any other public company which is not either an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible as possible different or revised standards may be used .
THE JOBS ACT WILL ALSO ALLOW THE COMPANY TO POSTPONE THE DATE BY WHICH IT MUST COMPLY WITH CERTAIN LAWS AND REGULATIONS INTENDED TO PROTECT INVESTORS AND REDUCE THE AMOUNT OF INFORMATION PROVIDED IN REPORTS FILED WITH THE SEC
The JOBS Act is intended to reduce the regulatory burden on “emerging growth companies. The Company meets the definition of an emerging growth company and so long as it qualifies as an “emerging growth company,” it will, among other things:
— be exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that its independent registered public accounting firm provide an attestation report on the effectiveness of its internal control over financial reporting.
— be exempt from the “say on pay” provisions (requiring a non-binding shareholder vote to approve compensation of certain executive officers) and the “say on golden parachute” provisions (requiring a non-binding shareholder vote to approve golden parachute arrangements for certain executive officers in connection with mergers and certain other business combinations) of the Dodd-Frank Act and certain disclosure requirements of the Dodd-Frank Act relating to compensation of its chief executive officer;
— be permitted to omit the detailed compensation discussion and analysis from proxy statements and reports filed under the Securities Exchange Act of 1934 and instead provide a reduced level of disclosure concerning executive compensation; and
— be exempt from any rules that may be adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotation or a supplement to the auditor’s report on the financial statements
The Company currently intends to take advantage of some or all of the reduced regulatory and reporting requirements that will be available to it so long as it qualifies as an “emerging growth company,”.
AS LONG AS THE COMPANY QUALIFIES AS AN EMERGING GROWTH COMPANY, THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM WILL NOT BE REQUIRED TO ATTEST TO THE EFFECTIVENESS OF THE COMPANY’S INTERNAL CONTROL OVER FINANCIAL REPORTING.
Because the Company has elected to take advantage of the extended time periods for compliance with new or revised accounting standards provided for under Section 102(b) of the JOBS Act, among other things, this means that the Company's independent registered public accounting firm will not be required to provide an attestation report on the effectiveness of the Company's internal control over financial reporting so long as it qualifies as an emerging growth company, which may increase the risk that weaknesses or deficiencies in the internal control over financial reporting go undetected. Likewise, so long as it qualifies as an emerging growth company, the Company may elect not to provide certain information, including certain financial information and certain information regarding compensation of executive officers, that would otherwise have been required to provide in filings with the SEC, which may make it more difficult for investors and securities analysts to evaluate the Company. As a result, investor confidence in the Company and the market price of its common stock may be adversely affected.
USE OF PROCEEDS
Our offering is being made on a self-underwritten, best-efforts basis: no minimum number of shares must be sold in order for the offering to proceed. We expect to use any proceeds received from the offering for general corporate purposes, including working capital needs set forth in our plan of operation as described below in Management’s Discussion and Analysis or Plan of Operation. The offering scenarios presented are for illustrative purposes only and the actual amount of proceeds, if any, may differ.
Our Officers and Directors will not receive any compensation for their efforts in selling our shares. Our management will have broad discretion in the application of the net proceeds of this offering. In addition to changing allocations because of the amount of proceeds received, we may change the use of proceeds because of changes in our business plan. Investors will be relying on the judgment of our management regarding the application of the proceeds of any sale of the securities. We may invest the net proceeds received from this offering temporarily until we use them for general corporate purposes.
We do not intend to use the proceeds to acquire assets or finance the acquisition of other businesses. At present, no material changes are contemplated. Should there be any material changes in the projected use of proceeds in connection with this offering, we will issue an amended prospectus reflecting the new uses.
See table under Plan of Operations, page 22.
DETERMINATION OF OFFERING PRICE
As there is no established public market for our shares, the offering price and other terms and conditions relative to our shares have been arbitrarily determined by LPC and do not bear any relationship to assets, earnings, book value, or any other objective criteria of value. In addition, no investment banker, appraiser, or other independent third party has been consulted concerning the offering price for the shares or the fairness of the offering price used for the shares.
The historical net tangible book value as of December 31, 2012, was $13,958 or $0.016 per share. Pro forma net tangible book value per share of common stock is equal to our total tangible assets less total liabilities, divided by the number of shares of common stock outstanding as of December 31, 2012, as adjusted to give effect to the receipt of net proceeds from the sale of 400,000 shares of common stock for $100,000. This represents an immediate increase of $0.073 per share to existing stockholders and an immediate and substantial dilution of $0.161 per share, or approximately 64.4%, to new investors purchasing our securities in this offering. Dilution in pro forma net tangible book value per share represents the difference between the amount per share paid by purchasers of shares of our common stock in this offering and the pro forma net tangible book value per share of our common stock immediately following this offering.
The following table sets forth as of December 31, 2012, the number of shares of common stock purchased from us and the total consideration paid by our existing stockholders and by new investors in this offering if new investors purchase all of the shares being offered in this offering, before deducting offering expenses payable by us, assuming a purchase price in this offering of $0.25 per share of common stock.
PLAN OF DISTRIBUTION
875,000 common shares are issued and outstanding as of the date of this prospectus. The Company is registering an additional of 400,000 shares of its common stock for possible resale at the price of $0.25 per share.
LPC will receive all proceeds from the sale of those shares. The price per share is fixed at $0.25. Prior to being quoted on the OTCBB, the company may sell its shares in private transactions to individuals. Although our common stock is not quoted on a public exchange, we intend to seek a quote on the Over the Counter Bulletin Board (OTCBB). In order to be quoted on the OTCBB, a market maker must file an application on our behalf in order to make a market for our common stock. There can be no assurance that a market maker will agree to file the necessary documents with FINRA, which operates the OTCBB, nor can there be any assurance that such an application for quotation will be approved. However, sales by the Company must be made at the fixed price of $0.25 until a market develops for the stock.
We intend to seek a quoting with the OTCBB, if we are unable to get a Broker Dealer to apply to the OTCBB or are unable to receive approval to quote in the OTCBB, we may wish to apply to the Pink Sheets.
The offering will conclude at the earlier of the sale for all shares or 180 days after this registration statement becomes effective with the Securities and Exchange Commission. LPC may at its discretion extend the offering for an additional 90 days. Further, the Company will not offer its shares for sale through underwriters, dealers, agents or anyone who may receive compensation in the form of underwriting discounts, concessions or commissions from the Company and/or the purchasers of the shares for whom they may act as agents.
This is a self-underwritten (“best-efforts”) offering. This Prospectus is part of a registration statement that permits our Officers and Directors to sell the shares being offered by the Company directly to the public, with no commission or other remuneration payable to them for any shares they may sell. There are no plans or arrangements to enter into any contracts or agreements to sell the shares with a broker or dealer. Our Officers and Directors will sell the shares and intends to offer them to friends, family members and business acquaintances. In offering the securities on our behalf, our Officers and Directors will rely on the safe harbor from broker dealer registration set out in Rule 3a4-1 under the Securities Act of 1934. The Officers and Directors will not register as broker-dealers pursuant to Section 15 of the Securities Exchange Act of 1934, in reliance upon Rule 3a4-1, which sets forth those conditions under which a person associated with an Issuer may participate in the offering of the Issuer’s securities and not be deemed to be a broker-dealer.
In addition and without limiting the foregoing, the Company will be subject to applicable provisions, rules and regulations under the Exchange Act with regard to security transactions during the period of time when this Registration Statement is effective.
LPC will pay all expenses incidental to the registration of the shares (including registration pursuant to the securities laws of certain states).
DESCRIPTION OF SECURITIES
Our authorized capital stock consists of 180,000,000 shares of common stock, par value $0.0001 per share. The holders of our common stock:
· have equal ratable rights to dividends from funds legally available if and when declared by our Board of Directors;
· are entitled to share ratably in all of our assets available for distribution to holders of common stock upon liquidation, dissolution or winding up of our affairs;
· do not have preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights; and
· are entitled to one non-cumulative vote per share on all matters on which stockholders may vote.
We refer you to the Bylaws of our Articles of Incorporation and the applicable statutes of the State of Delaware for a more complete description of the rights and liabilities of holders of our securities.
Holders of shares of our common stock do not have cumulative voting rights, which means that the holders of more than 50% of the outstanding shares, voting for the election of Directors, can elect all of the Directors to be elected, if they so choose and, in that event, the holders of the remaining shares will not be able to elect any of our Directors. After this offering is completed, our Officers and Directors will own approximately 67% of our outstanding shares.
As of the date of this prospectus, we have not declared or paid any cash dividends to stockholders. The declaration of any future cash dividend will be at the discretion of our Board of Directors and will depend upon our earnings, if any, our capital requirements and financial position, our general economic conditions and other pertinent conditions. It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings in our business operations.
Stock Transfer Agent
We have not engaged the services of a transfer agent at this time. However, within the next twelve months we anticipate doing so. Until such a time a transfer agent is retained, LPC will act as its own transfer agent.
INTERESTS OF NAMED EXPERTS AND COUNSEL
No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, Director, Officer, or employee.
The financial statements included in this prospectus and the registration statement have been audited by Dov Weinstein & Co., the extent and for the periods set forth in their report appearing elsewhere herein and in the registration statement. The financial statements are included in reliance on such report given upon the authority of said firm as experts in auditing and accounting.
Jonathan D. Strum, our independent legal counsel, has provided an opinion on the validity of our common stock.
DESCRIPTION OF BUSINESS
On November 17, 2011, we were incorporated in the State of Delaware and established a fiscal year end of December 31. The objective of this corporation is to distribute sports nutritional supplements, especially in ring form capable of being worn during exercise, including initially in Israel.
Our Company believes that the search for a healthier life is linked directly an active life and to improvements in our eating habits and how we choose our foods. It seems to be a concern on the mind of many individuals who are also trying to have an active healthy life style, including by participating in sports events such as triathlons and marathons. LPC believes that the concept behind our sports nutritional supplements is aligned with healthy lifestyle concerns as they assist athletes whilst in the midst of exercise or competition.
The market for sports nutritional supplements is growing year over year, and is a flourishing market. As an example, in the United States, research released in 2008 revealed that consumers are increasingly incorporating sports nutritional supplements into their lifestyles. “Total household penetration across six product categories has risen from 57 percent in 2006 to 59 percent in 2007 (source: http://www.grabstats.com/statmain.asp?StatID=1176). The research also showed that the number of core users has increased from 16 percent in 2006 to 18 percent in 2007.” Source: http://www.grabstats.com/statmain.asp?StatID=1177 .
We intend to create a fully functional website (www.lollipopsports-.com) with updates as to healthy events to occur in Israel and in other territories as a way to attract individuals who also will choose to purchase our sports nutritional supplements. We have secured the web domain and the current website is a template of what we expect to further develop. The website is still under construction.
Therefore we expect to generate revenue by selling our sports nutritional supplements:
We believe that Lollipop Corporation will also attract individuals who are seeking nutrients during the course of their exercise and athletes who need a help to be on track for their special nutritional and dietary requirements.
We do not plan to manufacture out sports nutritional supplements directly, but rather to have as yet unidentified third party suppliers from the far east and local partners at the point of distribution to deliver directly to our customers. We plan on establishing a commissioning policy for each supplier/partner. We expect that our suppliers will be able to deliver the products to our clients using their existing structure. If one or all of our suppliers can’t provide delivery service, we would have to hire a third party delivery company and, in this case, we would charge a delivery fee to our clients. In order to keep the delivery cost down, we intend to seek for several clients who live in the same area, so, more deliveries would be made at each time.
Initially we intend to hire a freelance athlete and a known sports internet site to hand out free our sports nutritional supplements at sporting events held in public locations. We intend to do this at major soccer, basketball and other sporting events, running events and other public sports events, including in the large metropolitan areas of Tel-Aviv and Haifa. We expect to also achieve some free “editorial” media coverage as these matches and the crowd is often covered by the evening news.
Distribution to Stores
We plan to hire a yet undetermined distribution company to be responsible for distributing this product to retail chains. Our President will make the introduction into the retail chains by calling on the buyers of these establishments. All distribution and collection of monies will be done by the distributors we plan to hire in the future. Our product will have an additional 15% fee added on to it in order to cover the costs of the distributor. We intend to establish a direct sales channel with Eden Teva Markets which is a chain of health food stores in addition to the major chain stores such as Supersol, Blue Square, and others. We intend to offer them to sell our sports nutritional supplements and place the product on their shelves. Here too we intend to have students handing out tasters to passing customers, thereby explaining the benefits of what we are selling.
According to research analysts in the nutritional supplement market, the sports nutrition industry has reached a stage where the focus needs to be on acquiring new consumers while retaining existing ones. With new products and variants being launched frequently, brands are fighting for both shelf space and consumer attention. The wide range of choices in terms of flavor, form, size, and price is encouraging consumers to shift from product to product, trying out tastes and other benefits. As a result, most participants in the sports/fitness nutrition industry - with the exception of the top ten companies, which have strong product profiles - find themselves struggling to retain customer loyalty. Developing stronger brands with distinct identities and clear-cut positioning holds the key to overcome this challenge.
Better Taste Profile Increases Product Appeal for Mainstream Consumers
"In the last three years, the single most important factor driving the growth of the sports nutrition industry has been taste," says analyst of sports nutrition market. With an increasing number of mainstream consumers adopting sports nutrition products as a means of healthy living, the taste factor will remain important for some more time to come.
Our management understands that functional benefits alone are not enough - the reason most sports nutrition products fail to attract mainstream consumers is their weak taste profile. Focused R&D efforts on this area, has resulted in an explosion of flavors - each product category from top manufacturers has at least three to four flavor variants. As the market tries to draw more mainstream consumers, the importance of taste and texture profiles is expected to increase further. We believe that a lollipop form of sports nutrition supplement while taking part in an athletic activity will add flavor to such participation.
Ever Increasing Awareness Levels Draw Health Conscious People Toward Sports Nutrition
One of the key factors influencing the demand for sports nutrition products is the awareness level of the potential consumer, which is usually bolstered by books, magazines, and other media. Increasing health consciousness and focus on issues such as obesity-related deaths and the adverse effects of eating wrong foods is steering people toward healthy lifestyles. The average consumer now feels that regular diets do not provide them with all the essential nutrients they need - something sports nutrition products can do. Accordingly, manufacturers are also promoting sports nutrition products as health foods, which have an affect on physical appearance as well as performance.
Management feels that there is a large potential growth in the development of online sales of sports nutritional supplements, particularly those which can be consumed during activity manufactured with key vitamins. Lollipop Corporation intends to penetrate this market using a strategy of attracting customers to buy its energy bars by explaining the health and athletic benefits of an sports nutritional supplement. We have no arrangements in place with any of the companies identified as sports nutrional supplement suppliers.
Description of our Product
Our business will be based on the development of the website www.lollipopsports.com, from which we expect to attract customers who are interested in purchasing sports nutritional supplements which will be available in ring and sucking candy form for consumption, during or after their training or participation in sporting events.
Currently, we are not offering any services or selling any product in our website as we are still in the development stage of our company. Our main competitor is a local Israeli based company, On Target Sports founded in 2005 that has focused on importing and marketing specialty equipment/gear and nutrition for endurance athletes, in order to help them reach their goal. Their wholesale chain covers the entire country with over 100 stores: Bike, professional running, triathlon, fitness clubs, health and nutrition. In addition to traditional stores, their distribution network includes kiosks and booths at major sports events year round, in order to showcase its products and to meet its customers' needs. We intend to sell our products in these markets and believe that our main advantage will be our ability to cooperate with other food distributors and work within their networks as an additional source of endurance products. We expect to have a significant distinction from our competition due to our business model, where we plan to offer different services and products from those available on our competitors’ websites such as:
Since we are initially targeting the market segment to ages 18 to 50, we believe that in addition to advertising at triathlon, running and other sports events, the internet will play an important marketing vehicle to get Lollipop Corporation known. Bearing this in mind, our plan consists of:
Facebook (www.facebook.com): by creating a profile for Lollipop Corporation, we expect to join a community interested in sports nutritional supplements and products. In this way, we can make our business known and attract more potential users to our services.
Twitter (www.twitter.com): by posting information about sports nutritional supplements and products and our prodcust benfifits while exercising or training, we intend to promote our business and attract more users to our website. Also, by encouraging our users to post opinions and suggestions about our sports nutritional supplement we expect to raise interest to our business.
Also we plan to advertise on the website products and services related to weekend sports events and to participate in expositions and forums.
We intend, in due course, subject to legal advice, to apply for trademark protection and/or copyright protection in Israel and other jurisdictions. We intend to aggressively assert our rights trademark and copyright laws to protect our intellectual property, including product design, product research and concepts and recognized trademarks. These rights are protected through the acquisition of trademark registrations, the maintenance of copyrights, and, where appropriate, litigation against those who are, in our opinion, infringing these rights.
While there can be no assurance that registered trademarks and copyrights will protect our proprietary information, we intend to assert our intellectual property rights against any infringer. Although any assertion of our rights can result in a substantial cost to, and diversion of effort by, our Company, management believes that the protection of our intellectual property rights is a key component of our operating strategy.
We are unaware of and do not anticipate having to expend significant resources to comply with any governmental regulations. However, we still need to verify certifications and possible government approvals needed to execute our business. We are subject to the laws and regulations of those jurisdictions in which we plan to sell our product, which are generally applicable to business operations, such as business licensing requirements, income taxes and payroll taxes. In general, the development and operation of our business is not subject to special regulatory and/or supervisory requirements.
Employees and Employment Agreements
As the date of this prospectus, LPC has no paid staff. Mr. Fromer is the President, CEO and Chairman of the Company. Mr. Fromer is employed elsewhere and has the flexibility to work on LPC up to 15 hours per week. He is prepared to devote more time to our operations as may be required. He is not being paid at present.
Ms. Dahan-Asulin is the Secretary of the Company. Ms. Dahan-Asulin is employed elsewhere and has the flexibility to work on LPC up to 15 hours per week. She is prepared to devote more time to our operations as may be required. She is not being paid at present.
There are no employment agreements in existence. The Company presently does not have pension, health, annuity, insurance, stock options, profit sharing or similar benefit plans; however, the Company may adopt plans in the future. Management does not plan to hire additional employees at this time. Our Officers and Directors will be responsible for the initial servicing. When the Company raises enough funds and resumes the work on its current Internet website template (www.lollipopsports.com), it will hire an independent consultant for the further development and finalization of the site. The Company also intends to hire sales representatives initially on a commission only basis to keep administrative overhead to a minimum.
We have not incurred and do not anticipate incurring any expenses associated with environmental laws.
We have a mailing address at 15500 SW Jay St.#81704 Beaverton, Oregon 97006-6018, our telephone is 855 222-1114. Except for the mail address and the use of a room at the premises of our President located at 7 Kaufman Street Jerusalem Israel for our operations in Israel, the Company does not own or rent any property. We expect that once our business is able to expand and we have the financial resources then we will seek additional rental locations for our operations, including in Israel.
We are not yet subject to the reporting requirements of the Securities Exchange Act of 1934. We have filed with the SEC a registration statement on Form S-1 under the Securities Act with respect to the common stock offered hereby. This prospectus, which constitutes part of the registration statement, does not contain all of the information set forth in the registration statement and the exhibits and schedule thereto, certain parts of which are omitted in accordance with the rules and regulations of the SEC. For further information regarding our common stock and our Company, please review the registration statement, including exhibits, schedules and reports filed as a part thereof. Statements in this prospectus as to the contents of any contract or other document filed as an exhibit to the registration statement, set forth the material terms of such contract or other document but are not necessarily complete, and in each instance reference is made to the copy of such document filed as an exhibit to the registration statement, each such statement being qualified in all respects by such reference.
We will comply with the informational requirements of the Exchange Act which requires us to file reports, proxy statements and other information with the SEC. Such reports, proxy statements and other information along with the registration statement, including the exhibits and schedules thereto, may be inspected at public reference facilities of the SEC at 100 F Street N.E, WashingtonD.C.20549. Copies of such material can be obtained from the Public Reference Section of the SEC at prescribed rates. You may call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference room. Because we file documents electronically with the SEC, you may also obtain this information by visiting the SEC’s Internet website at http://www.sec.gov.
Reports to security holders
After we complete this offering, we will not be required to furnish you with an annual report. Further, we will not voluntarily send you an annual report. We will be required to file reports with the SEC under section 13 (a) or 15(d) of the Securities Act. The reports will be filed electronically. The reports we will be required to file are Forms 10-K, 10-Q, and 8-K. You may read copies of any materials we file with the SEC at the SEC’s Public Reference Room or visiting the SEC’s Internet website (see “Available Information” above).
We are not currently a party to any legal proceedings.
Our fiscal year end is December 31. We will provide audited financial statements to our stockholders on an annual basis; as prepared by an Independent Certified Public Accountant.
DECEMBER 31, 2012
REPORT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders of
Lollipop Corporation (A Development Stage Company)
We have audited the accompanying balance sheet of Lollipop Corporation (a development stage company) (“the Company”) as of December 31, 2012 and 2011, and the related statements of operations, changes in stockholders’ equity and cash flows for the periods then ended and from the period of inception (November 17, 2011) through December 31, 2012. 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 audit in accordance with 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. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides 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 Lollipop Corporation (A Development Stage Company) as of December 31, 2012 and the results of its operations and cash flows for the year described above 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. The Company has not established a source of revenues sufficient to cover its operating costs, and as such, has incurred an operating loss since its inception. These matters raise substantial doubt about the Company’s ability to continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that may result should the Company be unable to continue as a going concern. See note 1 to the financial statements for further information regarding this uncertainty.
/s/ Dov Weinstein & Co. C.P.A. (Isr)
January 13, 2013
(A Development Stage Company)
The accompanying notes are an integral part of these financial statements.
(A Development Stage Company)
The accompanying notes are an integral part of these financial statements.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' DEFICIT
for the period of NOVEMBER 17, 2011 (INCEPTION) to DECEMBER 31, 2011
The accompanying notes are an integral part of these financial statements.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
The accompanying notes are an integral part of these financial statements.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2012
NOTE 1 – NATURE OF BUSINESS AND BASIS OF PRESENTATION
Lollipop Corporation is a Delaware corporation (the “Corporation”) incorporated under the laws of the State of Delaware on November 17, 2011.The Corporation is in the development stage as defined by Accounting Standards Codification 915 (ASC 915), “Accounting and reporting by Development Stage Enterprises”. The Corporation's main business is to distribute sports nutritional supplements.
Basis of Presentation
The financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (U.S. GAAP). The financial statements have been prepared on the historical cost basis. Historical cost is generally based on the fair value of the consideration given in exchange for assets.
Fiscal Year End
The Corporation has adopted a fiscal year end of December 31.
The accompanying financial statements have been prepared assuming that the Corporation will continue as a going concern. The Corporation has no established source of revenue. This raises substantial doubt about the Corporation’s ability to continue as a going concern. Without realization of additional capital, it would be unlikely for the Corporation to continue as a going concern. The financial statements do not include any adjustments that might result from this uncertainty.
In view of these matters, continuation as a going concern is dependent upon the continued operations of the Corporation, which in turn is dependent upon the Corporation's ability to meet its financial requirements, raise additional capital, and the success of its future operations. The financial statements do not include any adjustments to the amount and classification of assets and liabilities that may be necessary should the Corporation not continue as a going concern.
The Corporation plans to improve its financial condition through a public offering as described in Note 6. However, there is no assurance that the Corporation will be successful in accomplishing this objective. Management believes that this plan provides an opportunity for the Corporation to continue as a going concern.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts or revenues and expenses during the reporting period. Actual results could differ from those estimates.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies are set out below; these policies have been consistently applied to the period presented, unless otherwise stated:
Cash and cash equivalents
The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.
Earnings per share
The Company computes net loss per share in accordance with ASC 260, "Earnings per Share" ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is calculated by dividing the profit or loss attributable to common shareholders of the Company by the weighted average number of common shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to common shareholders and the weighted average number of common shares outstanding for the effects of all potential dilutive common shares, which comprise options granted to employees. As at December 31, 2012, the Company had no potentially dilutive shares.
Income taxes are accounted for in accordance with ASC Topic 740, “Income Taxes.” Under the asset and liability method, deferred tax assets and liabilities are recognized for the future consequences of differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases (temporary differences). Deferred tax assets and liabilities are measured using tax rates expected to apply to taxable income in the years in which those temporary differences are recovered or settled. Valuation allowances for deferred tax assets are established when it is more likely than not that some portion or all of the deferred tax assets will not be realized.
NOTE 3 – STOCKHOLDER’S EQUITY
On December 7, 2011, the Corporation issued 875,000 shares of common stock to the two directors of the Corporation at a price of $0.016 per share, for $14,000, for initial capital (stock subscription receivable). The proceeds from this stock issuance was received on November 14, 2012.
NOTE 4 – RELATED PARTY TRANSACTIONS
Details of transactions between the Group and other related parties are disclosed below:
The following entities have been identified as related parties :
Yisrael Meir Fromer - Director and greater than 10% stockholder
Malka Dahan-Asulin - Director and greater than 10% stockholder
NOTE 5 – INCOME TAXES
The (benefit)/provision for income taxes for the periods ended December 31, 2012 was as follows (assuming a 15% effective tax rate):
NOTE 6 – SUBSEQUENT EVENTS
The Company has commenced capital formation activity by filing Registration Statement on Form S-1 to the SEC, to register and sell in a self-directed offering of 400,000 shares of newly issued common stock at an offering price of $0.25 per share for proceeds for up to $100,000.
There were no additional subsequent events through the date of issuance of these audited financial statements.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This section of the Registration Statement includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our predictions.
As long as we succeed to raise the funds required to start our operation, we plan to develop its initial activities in 12 months, after the termination of this offering, as shown in the following tables, which presents the planned activities, duration and investments. If we do not raise enough cash through this offering, the following plan of operation below will take effect after we raise enough funds to do so.
As of the date of this prospectus, we have not yet implemented our business plan; we have only secured the web domain ( www.lollipopsports.com) and created a template of our to-be finalized website.
Our business development is planned to start with market research and analysis for sports nutritional supplements during the first 3 months, legal and regulatory research during the 1st and 2nd quarters of 2013, development of the detailed services concept and development of the detailed market plan until 6 months following the completion of our capital raise; suppliers selection and partnership agreements for 6 months following the completion of our capital raise; and in the three months following our capital raise the final development of our website, planned to be completed within 12th month following our capital raise, when we expect to be fully functional.
Our plans would be curtailed under offering scenarios of less than 100%. All of our anticipated costs are shown in the tables below under possible results of the sale of our shares (if 100% or 50% of the offered shares are sold).
The tables below represents our plan of operation using the net proceeds (gross proceeds less offering costs) under the 50% and 100% offering scenarios.
We expect to generate revenue from the sale of our sports nutritional supplements. To be successful, our company needs to accomplish the steps described above, in order to have a better understanding of the Market and then establish our Marketing strategies. Our company believes that the success of our business relies on the proper execution of the above described plan of operation.
We do not plan to manufacture our product but rather to have as yet unidentified third party suppliers/partners provide us with the energy bars under our LPC trade name and according to our business model. We expected that our product shall be sourced from multiple suppliers/partners, which would allow us to possibly always have a supplier nearby our clients, resulting in faster delivery and fresher ingredients. We plan on establishing a commissioning policy for each supplier/partner. We expect that our suppliers will be able to deliver the products to our clients using their existing structure. If one or all of our suppliers can’t provide delivery service, we would have to hire a third party delivery company and, in this case, we would charge a delivery fee to our clients. In order to keep the delivery cost down, we intend to seek for several clients who live in the same area, so, more deliveries would be made at each time.
Results of Operations
For the period from inception (November 17, 2011) through January 15, 2013, we had no revenue. Expenses for the period totaled $42 resulting in a Net loss of $42. The majority of expenses are associated with opening the Company’s bank account and the transfer of money into it from the sale of shares from our officers and directors.
Capital Resources and Liquidity
As of January 15, 2013 we had $13,983 in cash, with liabilities of $25, costs mostly associated with the opening the Company’s bank account.
Our auditors have issued a “going concern” opinion, meaning that there is substantial doubt if we can continue as an on-going business for the next twelve months unless we obtain additional capital. No substantial revenues are anticipated until we have completed the financing from this offering and implemented our plan of operations. Our only source for cash at this time is investments by others in this offering. We must raise cash to implement our strategy and stay in business. We believe that 50% of the amount of the offering would likely allow us to maintain our reporting status for 12 months once this registration becomes effective. We believe that unless we are able to raise the full offering amount of $100,000 then we will not have sufficient funds to meet all of our capital needs for the next twelve months as envisioned under our business plan. In the event of the failure to complete our offering we would need to seek capital from other resources such as debt financing, which may not even be available to us. Raising 50% of our target would not allow the Company to complete a basic website capable of generation revenues and the Company would have to seek additional capital through debt or equity in order to create a website capable of generating revenue. The Company believes if it can raise at least 50% or more of its financing goals under this prospectus it will be able to build a website capable of generating revenues.
Management believes that if subsequent private placements are successful, we will generate sales revenue within the following twelve months thereof. However, additional equity financing may not be available to us on acceptable terms or at all, and thus we could fail to satisfy our future cash requirements.
We are exclusively dependent upon the success of the anticipated offering described herein. Therefore, the failure thereof would result in need to seek capital from other resources such as debt financing, which may not even be available to the Company. However, if such financing were available, because we are a development stage Company with no operations to date, it would likely have to pay additional costs associated with high risk loans and be subject to an above market interest rate. At such time these funds are required, management would evaluate the terms of such debt financing. If the Company cannot raise additional proceeds via a private placement of its common stock or secure debt financing, it would be required to cease business operations. As a result, investors would lose all of their investment.
We do not anticipate researching any further products or services other than the ones described on this prospectus nor the purchase of any significant equipment. The sports nutritional supplements to be sold shall be provided by our suppliers and partners. Our company believes that, due to the fact that we have not implemented our business plan and have not generated any revenues yet, it is important to keep the focus on our business plan before starting researching for new products and services, depending on the results of our plan of operation We also do not expect any significant additions to the number of employees, as the company intends to hire third party consultants when necessary.
As of the date of this registration statement, the current funds available to the Company will not be sufficient to continue maintaining a reporting status. The Company’s Officers and Directors, have indicated at this time that they may be willing to provide funds required to maintain the reporting status in the form of a non-secured loan for the next twelve months as the expenses are incurred if no other proceeds are obtained by the Company. However, there is no contract in place or written agreement securing this agreement. Management believes if the Company cannot maintain its reporting status with the SEC it will have to cease all efforts directed towards the Company. As such, any investment previously made would be lost in its entirety.
Should the Company fail to raise capital through this offering and our Officers and Directors are unwilling or unable to loan the Company funds to proceed with its plans the Company will have to cease all business activities until such time further funds are raised. As the Company does not currently have enough cash to fund its business plan and may not have enough to pay all of its liabilities; if the Company is unable to raise funds from this offering it may be able to issue restricted common shares to its creditors to satisfy their debts. The Company would only offer its creditors shares to settle debt if unable to raise equity financing. The Company would not settle any related debt with this type of share offering. The Company’s current debts are to its attorney, auditor and printer. There is no assurance that any of the Company’s creditors would accept restricted shares from the company in exchange for its debt.
Election under JOBS Act of 2012
The Company has chosen to opt-in and make use of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act of 2012. This election is irrevocable.
Jumpstart Our Business Startups Act
In April, 2012, the Jumpstart Our Business Startups Act ("JOBS Act") was enacted into law. The JOBS Act provides, among other things:
Exemptions for emerging growth companies from certain financial disclosure and governance requirements for up to five years and provides a new form of financing to small companies;
Amendments to certain provisions of the federal securities laws to simplify the sale of securities and increase the threshold number of record holders required to trigger the reporting requirements of the Securities Exchange Act of 1934;
Relaxation of the general solicitation and general advertising prohibition for Rule 506 offerings;
Adoption of a new exemption for public offerings of securities in amounts not exceeding $50 million; and Exemption from registration by a non-reporting company of offers and sales of securities of up to $1,000,000 that comply with rules to be adopted by the SEC pursuant to Section 4(6) of the Securities Act and exemption of such sales from state law registration, documentation or offering requirements.
In general, under the JOBS Act a company is an emerging growth company if its initial public offering ("IPO") of common equity securities was effected after December 8, 2011 and the company had less than $1 billion of total annual gross revenues during its last completed fiscal year. A company will no longer qualify as an emerging growth company after the earliest of
(i) the completion of the fiscal year in which the company has total annual gross revenues of $1 billion or more,
(ii) the completion of the fiscal year of the fifth anniversary of the company's IPO;
(iii) the company's issuance of more than $1 billion in nonconvertible debt in the prior three-year period, or
(iv) the company becoming a "larger accelerated filer" as defined under the Securities Exchange Act of 1934.
The JOBS Act provides additional new guidelines and exemptions for non-reporting companies and for non-public offerings. Those exemptions that impact the Company are discussed below.
Financial Disclosure. The financial disclosure in a registration statement filed by an emerging growth company pursuant to the Securities Act of 1933 will differ from registration statements filed by other companies as follows:
(i) audited financial statements required for only two fiscal years;
(ii) selected financial data required for only the fiscal years that were audited;
(iii) executive compensation only needs to be presented in the limited format now required for smaller reporting companies. (A smaller reporting company is one with a public float of less than $75 million as of the last day of its most recently completed second fiscal quarter)
However, the requirements for financial disclosure provided by Regulation S-K promulgated by the Rules and Regulations of the SEC already provide certain of these exemptions for smaller reporting companies. The Company is a smaller reporting company. Currently a smaller reporting company is not required to file as part of its registration statement selected financial data and only needs audited financial statements for its two most current fiscal years and no tabular disclosure of contractual obligations.
The JOBS Act also exempts the Company's independent registered public accounting firm from complying with any rules adopted by the Public Company Accounting Oversight Board ("PCAOB") after the date of the JOBS Act's enactment, except as otherwise required by SEC rule.
The JOBS Act also exempts an emerging growth company from any requirement adopted by the PCAOB for mandatory rotation of the Company's accounting firm or for a supplemental auditor report about the audit.
Internal Control Attestation. The JOBS Act also provides an exemption from the requirement of the Company's independent registered public accounting firm to file a report on the Company's internal control over financial reporting, although management of the Company is still required to file its report on the adequacy of the Company's internal control over financial reporting.
Section 102(a) of the JOBS Act exempts emerging growth companies from the requirements in §14A(e) of the Securities Exchange Act of 1934 for companies with a class of securities registered under the 1934 Act to hold shareholder votes for executive compensation and golden parachutes.
Other Items of the JOBS Act. The JOBS Act also provides that an emerging growth company can communicate with potential investors that are qualified institutional buyers or institutions that are accredited to determine interest in a contemplated offering either prior to or after the date of filing the respective registration statement. The Act also permits research reports by a broker or dealer about an emerging growth company regardless if such report provides sufficient information for an investment decision. In addition the JOBS Act precludes the SEC and FINRA from adopting certain restrictive rules or regulations regarding brokers, dealers and potential investors, communications with management and distribution of a research reports on the emerging growth company IPO.
Section 106 of the JOBS Act permits emerging growth companies to submit 1933 Act registration statements on a confidential basis provided that the registration statement and all amendments are publicly filed at least 21 days before the issuer conducts any road show. This is intended to allow the emerging growth company to explore the IPO option without disclosing to the market the fact that it is seeking to go public or disclosing the information contained in its registration statement until the company is ready to conduct a roadshow.
Election to Opt Out of Transition Period. Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a 1933 Act registration statement declared effective or do not have a class of securities registered under the 1934 Act) are required to comply with the new or revised financial accounting standard.
The JOBS Act provides a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. The Company has elected not to opt out of the transition period and will “opt-in” and make use of the transitional period.
Off-balance sheet arrangements
The Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect or change on the Company’s financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term “off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with the Company is a party, under which the Company has (i) any obligation arising under a guarantee contract, derivative instrument or variable interest; or (ii) a retained or contingent interest in assets transferred to such entity or similar arrangement that serves as credit, liquidity or market risk support for such assets.
Pursuant to the JOBS Act of 2012, as an emerging growth company the Company has elected to opt into the extended transition period for any new or revised accounting standards that may be issued by the PCAOB or the SEC. The Company has elected utilize such extended transition period(s) which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the standard for the private company. This may make comparison of the Company's financial statements with any other public company which is not either an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible as possible different or revised standards may be used.
Although the Company is still evaluating the JOBS Act, it currently intends to take advantage of some or all of the reduced regulatory and reporting requirements that will be available to it so long as it qualifies as an “emerging growth company,”.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUTING AND FINANCIAL DISCLOSURE
There have been no changes in or disagreements with accountants regarding our accounting, financial disclosures or any other matter.
DIRECTORS AND EXECUTIVE OFFICERS
Identification of Directors and executive Officers
Our Directors serve until his successor is elected and qualified. Our Officers are elected by the Board of Directors to a term of one (1) year and serves until his successor is duly elected and qualified, or until he is removed from office. The Board of Directors has no nominating or compensation committees. The Company’s current Audit Committee consists of our two Officers and Directors.
The name, address, age and position of our Officers and Directors are set forth below:
The person named above has held his or her offices/positions since December 5, 2011and is expected to hold his or her offices/positions at least until the next annual meeting of our stockholders.
Yisrael Meir Fromer:
Since 2010 to present Mr. Fromer has been employed at Access Credit Ltd., a foreign exchange company. . His responsibilities include financial management, purchasing and selling of foreign currencies, and daily management of the facility. From 2001-2009 Mr. Fromer managed a youth organization for underprivileged children. His responsibilities included managing several facilities where underprivileged youth would arrive after school to do homework, sports, receive support and eat hot meals. While there he managed budget, logistics, oversight of mentors and planning for the daily/weekly activities.
Mrs. Dahan has worked as a teacher since 2007. Since 2010 to present she has focused on her hobby, music, and has headed up the schools music department. As part of her teaching career Mrs. Dahan has been responsible for educating classes six through eighth grade, although early in her teaching career he pupils were four to six year old children. Mrs. Dahan has completed studies with Dr. Miriam Ahdhan and she comleted her studies at the Old Seminar of Bet-Jacob.
Conflicts of Interest
At the present time, the Company does not foresee any direct conflict between Mr. Fromer’s other business interests and his involvement in LPC.
At the present time, the Company does not foresee any direct conflict between Ms.Dahan-Auslin’s other business interests and her involvement in LPC.
LPC has made no provisions for paying cash or non-cash compensation to its Officers and Directors. No salaries are being paid at the present time, and none will be paid unless and until our operations generate sufficient cash flows.
The table below summarizes all compensation awarded to, earned by, or paid to our named executive officers for all services rendered in all capacities to us for the period from inception (November 17, 2011) through January 10, 2013.
SUMMARY COMPENSATION TABLE
We did not pay any salaries in 2011 or 2012. We have not paid any salaries as of January 10, 2013. We do not anticipate beginning to pay salaries until we have adequate funds to do so. There are no other stock option plans, retirement, pension, or profit sharing plans for the benefit of our Officers and Directors other than as described herein.
Outstanding Equity Awards at Fiscal Year-End
The table below summarizes all unexercised options, stock that has not vested, and equity incentive plan awards for each named executive officers as of January 10, 2013.
There were no grants of stock options since inception to the date of this Prospectus.
We do not have any long-term incentive plans that provide compensation intended to serve as incentive for performance.
The Board of Directors of LPC has not adopted a stock option plan. The Company has no plans to adopt it but may choose to do so in the future.
Stock Awards Plan
The Company has not adopted a Stock Awards Plan, but may do so in the future. The terms of any such plan have not been determined.
The table below summarizes all compensation awarded to, earned by, or paid to our Directors for all services rendered in all capacities to us for the period from inception (November 17, 2011) through January 10, 2013.
At this time, LPC has not entered into any employment agreements with its Officers and Directors. If there is sufficient cash flow available from our future operations, the Company may enter into employment agreements with our Officers and Directors or future key staff members.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of the date of this prospectus, the total number of shares owned beneficially by our Officers and Directors, and key employees, individually and as a group, and the present owners of 5% or more of our total outstanding shares. The table also reflects what this ownership will be assuming completion of the sale of all or partial shares in this offering. The stockholder listed below has direct ownership of her or her shares and possesses sole voting and dispositive power with respect to the shares.
 The persons named above may be deemed to be a “parent” and “promoter” of our Company, within the meaning of such terms under the Securities Act of 1933, as amended, by virtue of his direct and indirect stock holdings. Mr. Yisrael Meir Fromer and Malka Dahan-Auslin are the only “promoters” of our Company.
Our Officers and Directors will continue to own the majority of our common stock after the offering, regardless of the number of shares sold. Since they will continue control the Company after the offering, investors will be unable to change the course of the operations. Thus, the shares we are offering lack the value normally attributable to voting rights. This could result in a reduction in value of the shares you own because of their ineffective voting power. None of our common stock is subject to outstanding options, warrants, or securities convertible into common stock.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On January 15, 2013, we issued a total of 875,000 shares of common stock to Mr. Yisrael Meir Fromer and Ms. Malka Dahan-Auslin, our Officers and Directors, for total cash consideration of $14,000. The Company believes that this issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, as amended, as a transaction by an issuer not involving any public offering.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Under our Bylaws, we may indemnify an Officer or Director who is made a party to any proceeding, including a lawsuit, because of his position, if he acted in good faith and in a manner he reasonably believed to be in our best interest. We may advance expenses incurred in defending a proceeding. To the extent that the Officer or Director is successful on the merits in a proceeding as to which he is to be indemnified, we must indemnify him against all expenses incurred, including attorney's fees. With respect to a derivative action, indemnity may be made only for expenses actually and reasonably incurred in defending the proceeding, and if the Officer or Director is judged liable, only by a court order. The indemnification is intended to be to the fullest extent permitted by the laws of the State of Delaware.
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to Directors, officers or persons controlling the registrant pursuant to the foregoing provisions, we have been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is therefore unenforceable.
Part II - INFORMATION NOT REQUIRED IN THE PROSPECTUS
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Independently of whether or not all shares are sold, the estimated expenses of the offering, all of which are to be paid by the Company, are as follows:
All amounts are estimates other than the Commission’s registration fee. We are paying all expenses of the offering listed above.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our Bylaws provide that we will indemnify an officer, Director, or former officer or Director, to the full extent permitted by law. We have been advised that in the opinion of the Securities and Exchange Commission indemnification for liabilities arising under the Securities Act of 1933 is against public policy as expressed in the Securities Act of 1933, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities is asserted by one of our Directors, officers, or controlling persons in connection with the securities being registered, we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit the question of whether such indemnification is against public policy to a court of appropriate jurisdiction. We will then be governed by the court's decision.
RECENT SALES OF UNREGISTERED SECURITIES
LPC is authorized to issue up to 180,000,000 shares of common stock with a par value of $0.0001.The Company is not listed for trading on any securities exchange in the United States and there has been no active market in the United States or elsewhere for the common shares.
The 875,000 shares sold to our Officers and Directors were offered and sold in reliance on the exemption from registration pursuant to Section 4(2) of the Securities Act of 1933, as amended, as a transaction by an issuer not involving any public offering.
During the current year, the Company has sold the following securities which were not registered under the Securities Act of 1933, as amended:
We have issued 875,000 common shares to our Officers and Directors for total of $14,000 received on November 14, 2012, or $0.016 per share.
The shares were offered and sold in reliance on the exemption from registration afforded by Rule 903(b)(3) of Regulation S, promulgated pursuant to the Securities Act of 1933, as amended.
We have spent a portion of the above proceeds to pay for costs associated with this prospectus and expect the balance of the proceeds to be mainly applied to further costs of this prospectus and administrative costs.
We shall report the use of proceeds on our first periodic report filed pursuant to sections 13(a) and 15(d) of the Exchange Act after the effective date of this Registration Statement and thereafter on each of our subsequent periodic reports through the later of disclosure of the application of all the offering proceeds, or disclosure of the termination of this offering.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
Description of Exhibits
The undersigned registrant hereby undertakes:
(a)(1)To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
i. To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;
ii. To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement.
iii. To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
Provided however, that:
A. Paragraphs (a)(1)(i) and (a)(1)(ii) of this section do not apply if the registration statement is on Form S-8, and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 15 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement; and
B. Paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section do not apply if the registration statement is on Form S-3 or Form F-3 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
2. That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
3. To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
4. If the registrant is a foreign private issuer, to file a post-effective amendment to the registration statement to include any financial statements required by Item 8.A. of Form 20-F at the start of any delayed offering or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Act need not be furnished, provided that the registrant includes in the prospectus, by means of a post-effective amendment, financial statements required pursuant to this paragraph (a)(4) and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements. Notwithstanding the foregoing, with respect to registration statements on Form F-3, a post-effective amendment need not be filed to include financial statements and information required by Section 10(a)(3) of the Act or Rule 3-19 of this chapter if such financial statements and information are contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the Form F-3.
5. That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
i. If the registrant is relying on Rule 430B:
A. Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and
B. Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date; or
ii. If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
6. That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
i. Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
ii. Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
iii. The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
iv. Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the “Act”) may be permitted to our Director, officers and controlling persons pursuant to the provisions above, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities, other than the payment by us of expenses incurred or paid by one of our Director, officers, or controlling persons in the successful defense of any action, suit or proceeding, is asserted by one of our Director, officers, or controlling person sin connection with the securities being registered, we will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification is against public policy as expressed in the Securities Act, and we will be governed by the final adjudication of such issue.
For the purposes of determining liability under the Securities Act for any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Jerusalem, State of Israel, on this 17 th day of January 2013.
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated: