PMAH PlasmaTech Inc (CE)

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS
 

Management’s Discussion and Analysis

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes appearing elsewhere in this Form 10-QSB. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements.

Plan of Operation

The Company (hereinafter referred to as “PlasmaTech”, the “Company,” “we”, “our” or “us”), has not yet generated any revenue from its operations. As of September 30, 2007 the Company had $68 of cash on hand. We anticipate that its current cash holdings and cash generated from operations will not be sufficient to satisfy its liquidity requirements over the next 12 months and we will seek to obtain additional funds. We will require working capital to support our marketing activities, such as attending trade shows to demonstrate our product, and pay legal and accounting fees. We anticipate raising additional capital through the sale of our common stock, debt securities or will seek alternative sources of financing.
 
If we are unable to obtain this additional financing, we may be required to reduce the scope of our planned sales and marketing efforts which could harm the Company’s financial condition and operating results. In addition, we may require additional funds in order to finance a more rapid expansion, to develop new or enhanced services or products or invest in complementary businesses, technologies, services or products. This additional funding may not be available on favorable terms, if at all.
 
There can be no assurance that we will be successful in raising additional equity financing to satisfy our future cash requirements, which is primarily working capital for the development of our website and carrying out our marketing campaigns, as well as legal and accounting fees. The Company depends upon capital to be derived from future financing activities such as subsequent offerings of our shares. Management believes that if subsequent private placements are successful, we will be able to

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generate revenue from sales of the products and achieve liquidity within the next twelve to fourteen months thereof. However, investors should be aware that this is based upon speculation and there can be no assurance that we will ever be able reach a level of profitability.
 
During the fiscal quarter ending September 30, 2007 the Company was primarily focused on market research and customer identification.

As of September 30, 2007 the Company has not received any orders for its product.
 

We intend to proceed with securing exclusive marketing rights for the Company’s plasma products for North and South America. We estimate that these rights will require a one time fee of approximately $10,000 and will require minimum annual sales quotas.

We plan to continue our marketing activities during the next twelve months by initiating the development of our website and launching direct email and telephone marketing activities directed at trade show design companies who may be interested in purchasing or licensing our products. We estimate that it will cost $10,000 to develop the website and $4,000 for direct email and telephone marketing.
 
We anticipate visiting up to ten high profile trade show design companies to solicit product orders from qualified customers. We estimate the travel cost to attend these shows will be $20,000. After obtaining product orders from at least ten “flagship” customers, we plan to finance further, more extensive, marketing activities and solicit product orders from major trade show design companies across North America. We intend to hire a commission sales person or persons to promote the Company’s product line within its primary market, the trade show management and promotions industry. The Company anticipates that the sales cycle (the length of time between initial customer contact and the completion of the sale) will be a minimum of 90 days.

We also plan to design and order additional samples of our plasma lighting products. We will purchase additional samples from various manufacturers in China and refine our technical requirements, specifications and pricing based on customer needs as determined from our marketing activities. We estimate that these samples will cost $22,000. We will also continue to identify a company or companies in China that will be able to manufacture and supply the signs according to our specifications and standards. We anticipate that it will be necessary to travel to China in order to finalize contractual terms and conditions with our chosen sign supplier(s). While in China we will also initiate arrangements for the shipping and distribution of our product from the factory in China to its customers in North America. The cost of securing product and arranging delivery is expected to total $7,000.
 

We do not expect to purchase or sell any significant equipment, have no current material commitments nor have we generated any revenue since inception.

We have no current plans, preliminary or otherwise, to merge with any other entity.
 
As the Company expands its business, we will likely incur losses. We plan on funding these losses through revenues generated from our marketing activities. If we are unable to satisfy our capital requirements through revenue production or we are unable to raise additional capital through the sale of our common shares we may have to borrow funds in order to sustain our business. We cannot give any assurance or guarantee that we will be able to borrow funds because we are a new business and the future success of the Company is highly speculative.

Off Balance Sheet Arrangements

As of the date of this Form 10-QSB, the current funds available to the Company will not be sufficient to continue to be able to meet our reporting obligations as a “reporting issuer” under the Securities Exchange Act of 1934, as amended. The cost to maintain the reporting status of the Company for the next twelve months has been estimated at $15,000. The Company’s officer and director, Christopher Brough, has indicated to the Company that he may be willing to provide the 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. However, there is no contract in place or written agreement securing this undertaking. 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. 

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Other than the above described situation, the Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in 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.