SGRB SigmaBroadband Company (PK)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: September 30, 2015

 

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________ to _____________

 

Commission File Number: 333-191426

SIGMABROADBAND CO.

(Exact name of registrant as specified in its charter)

 

GEORGIA	4899		46-1289228
(State or other jurisdiction of organization)	(Primary Standard Industrial Classification Code)		(Tax Identification Number)
2690 Cobb Parkway Suite A5 Atlanta, Georgia 33080 Tel: (800) 545-0010 (Address and telephone number of registrant's executive office)		2690 Cobb Parkway Suite A5 Atlanta, Georgia 33080 Tel: (800) 545-0010 (Name, address and telephone number of agent for service)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirement for the past 90 days. Yes [X] No [ ]

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ ] No [X]

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

 

Large Accelerated Filer [ ]

Accelerated Filer [ ]

Non-accelerated filer [ ] (Do not check if a smaller reporting company)

Smaller reporting company [X]

 

Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act). YES [ ] NO [X]

 

The number of shares outstanding of each of the issuer’s classes of common equity, as of November 22, 2015 was 24,596,000.

 

Table of Contents

SigmaBroadband Co.

 

Index

 

PART I - FINANCIAL INFORMATION				Page No.
Item 1.		Financial Statements		1
		Condensed Balance sheets at September 30, 2015 (unaudited) and December 31, 2014		1
		Condensed Statements of Operations (unaudited) for the three and nine months ended September 30, 2015 and 2014		2
		Condensed Statements of Cash Flows (unaudited) For the Nine Months Ended September 30, 2015 and 2014		3
		Notes to Condensed Financial Statements (unaudited), September 30, 2015		4
Item 2.		Management's Discussion and Analysis of Financial Condition and Results of Operations		8
Item 3.		Quantitative and Qualitative Disclosures About Market Risk		11
Item 4.		Controls and Procedures		11
PART II—OTHER INFORMATION
Item 1.		Legal Proceedings		13
Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds		13
Item 3.		Default Upon Senior Securities		13
Item 4.		Submission of Matters to a Vote of Security Shareholders		13
Item 5.		Other Information		13
Item 6.		Exhibits		15
Signatures				14

  

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This quarterly report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, that involve substantial risks and uncertainties. In addition, we, or our executive officers on our behalf, may from time to time make forward-looking statements in reports and other documents we file with the Securities and Exchange Commission, or SEC, or in connection with oral statements made to the press, potential investors or others. All statements, other than statements of historical facts, including statements regarding our strategy, future operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management are forward-looking statements. The words "expect," "estimate," "anticipate," "predict," "believe," "think," "plan," "will," "should," "intend," "seek," "potential" and similar expressions and variations are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

 

Forward-looking statements in this report are subject to a number of known and unknown risks and uncertainties that could cause our actual results, performance or achievements to differ materially from those described in the forward-looking statements, in this report as well as in the other documents we file with the SEC from time to time, and such risks and uncertainties are specifically incorporated herein by reference.

 

Forward-looking statements speak only as of the date the statements are made. Except as required under the federal securities laws and rules and regulations of the SEC, we undertake no obligation to update or revise forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. We caution you not to unduly rely on the forward-looking statements when evaluating the information presented in this report.

  

PART I—FINANCIAL INFORMATION

 

ITEM 1.    FINANCIAL STATEMENTS

 

The financial statements of SigmaBroadband Co. ("SigmaBroadband Co." or the "Company") as of September 30, 2015 and 2014 included herein have been prepared by the Company, without audit, pursuant to U.S. generally accepted accounting principles and the rules and regulations of the SEC. In addition, certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These financial statements reflect, in the opinion of management, all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the results for the interim periods. The results of operations for such interim periods are not necessarily indicative of the results for the full year.

 

SigmaBroadband Co.
Condensed Balance Sheets
September 30, 2015 and December 31, 2014
		September 30,				December 31,
		2015				2014
		(Unaudited)
ASSETS
Current Assets:
Cash and equivalents		$	767			$	2,161
Total current assets			767				2,161
Equipment, net			8,250,000				9,000,000
		$	8,250,767			$	9,002,161
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Accounts payable and accrued expenses		$	14,757				9,958
Accrued interest			184,187				124,187
Loans payable - stockholders			22,718				3,556
Total current liabilities			221,662				137,701
Note payable			10,000,000				10,000,000
Commitments and Contingencies			—				—
Stockholders' Equity:
Series A Preferred stock, no par value; 10,000,000 shares authorized, no shares issued and outstanding			—				—
Common stock, $0.0001 par value; 490,000,000 shares authorized, 24,596,000 and 24,596,000 shares issued and outstanding, respectively			2,460				2,460
Additional paid in capital			59,490				54,990
Treasury stock			(1,000	)			(1,000	)
Deficit			(2,031,845	)			(1,191,990	)
			(1,970,895	)			(1,135,540	)
		$	8,250,767			$	9,002,161

 

SigmaBroadband Co.
Condensed Statements of Operations
(Unaudited)
		For the Three Months Ended September 30,								For the Nine Months Ended September 30,
		2015				2014				2015				2014
Revenue		$	—			$	—			$	—			$	—
Cost of goods sold			—				—				—				—
Gross income			—				—				—				—
Expenses:
Computer and internet			30				30				209				89
Depreciation			250,000				250,000				750,000				750,000
Professional fees			2,035				13,547				8,461				18,620
Rent			1,500				1,500				4,500				4,639
Storage			707				639				2,057				1,917
Travel			—				—				1,023				2,134
Permits and fees			10				—				12,560				—
Other			120				90				975				1,303
			254,402				265,806				779,855				778,702
Net loss before other income, expenses and income taxes			(254,402	)			(265,806	)			(779,855	)			(778,702	)
Other income and (expenses)
Interest expense			(20,000	)			(30,000	)			(60,000	)			(90,520	)
Net loss before income taxes			(20,000	)			(30,000	)			(60,000	)			(90,520	)
Provision for income taxes			—				—				—				—
Net loss		$	(274,402	)		$	(295,806	)		$	(839,855	)		$	(869,222	)
Basic and diluted loss per share		$	(0.01	)		$	(0.01	)		$	(0.03	)		$	(0.04	)
Basic and diluted weighted average number of shares outstanding			24,596,000				24,588,391				24,596,000				24,579,123

 

 

SigmaBroadband Co.
Condensed Statements of Cash Flows
(Unaudited)
		For the Nine Months Ended September 30,
		2015				2014
Cash flows from operating activities:
Net (loss)		$	(839,855	)		$	(869,222	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation expense			750,000				750,000
Accounts payable and accrued expenses			64,799				91,924
Capitalized rent expense			4,500				4,500
Net cash provided by (used in) operating activities			(20,556	)			22,798
Cash flows from financing activities:
Proceeds from issuance of common stock			—				20,000
Stockholders' loans			19,162				1,066
Net cash provided by financing activities			19,162				21,066
Net decrease in cash			(1,394	)			(1,732	)
Cash at beginning of period			2,161				8,904
Cash at end of period		$	767			$	7,172
Supplemental cash flow information:
Cash paid during the period for:
Interest		$	—			$	—
Income taxes		$	—			$	—
Non-cash transactions:
Forgiven rent converted to additional paid-in capital		$	4,500			$	4,500

SigmaBroadband Co.

Notes to Condensed Financial Statements

September 30, 2015

(Unaudited)

 

Note 1.  NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Nature of Operations

 

SigmaBroadband Co. ("Sigma" or the "Company") was incorporated in Georgia in October 2012.  The Company  has not generated any revenue to date.  The Company is a full service, facilities-based broadband service provider, local exchange and inter-exchange carrier serving residential and commercial customers with a special focus on rural areas.

 

Basis of Presentation

 

The accompanying interim condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP").  In the opinion of management, all adjustments considered necessary for a fair presentation of the interim periods presented have been included.  All such adjustments are of a normal recurring nature.  The accompanying condensed financial statements and the information included under the heading Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Company's audited financial statements and related notes included in the Company's Form 10-K as of December 31, 2014.  Interim results are not necessarily indicative of the results for the year ended December 31, 2015.

 

Revenue Recognition

 

In general, the Company records revenue when persuasive evidence of an arrangement exists, services have been rendered or product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The following policies reflect specific criteria for the various revenues streams of the Company:

 

Revenue will be recognized at the time the product is delivered or services are performed.  Provision for sales returns will be estimated based on the Company's historical return experience.  Revenue will be presented net of returns.

 

Use of Estimates

 

The preparation of condensed financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the condensed balance sheets and the reported amounts of revenues and expenses during the reporting periods.  Actual results could differ from those estimates.

 

Net Loss Per Common Share

 

The Company calculates net income (loss) per share based on the authoritative guidance.  Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period.  Diluted earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares and dilutive common stock equivalents outstanding.  During periods in which the Company incurs losses common stock equivalents, if any, are not considered, as their effect would be anti-dilutive.  As of September 30, 2015, the Company had no common stock equivalents.

 

Income Taxes

 

The Company utilizes the accrual method of accounting for income taxes. Under the accrual method, deferred tax assets and liabilities are determined based on the differences between the financial reporting basis and the tax basis of the assets and liabilities, and are measured using enacted tax rates and laws that will be in effect when the differences are expected to reverse. An allowance against deferred tax assets is recognized, when it is more likely than not, that such tax benefits will not be realized.

SigmaBroadband Co.

Notes to Condensed Financial Statements

September 30, 2015

(Unaudited)

 

Note 1.  NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The Company recognizes the financial statement benefit of an uncertain tax position only after considering the probability that a tax authority would sustain the position in an examination. For tax positions meeting a “more-likely-than-not” threshold, the amount recognized in the financial statements is the benefit expected to be realized upon settlement with the tax authority.  For tax positions not meeting the threshold, no financial statement benefit is recognized. The Company recognizes interest and penalties, if any, related to uncertain tax positions in income tax expense.  The Company did not have any unrecognized tax benefits as of September 30, 2015, and does not expect this to change significantly over the next 12 months.

 

Stock-Based Compensation

 

The Company accounts for equity instruments issued to employees in accordance with ASC 718, Compensation - Stock Compensation.  ASC 718 requires all share-based compensation payments to be recognized in the financial statements based on the fair value on the issuance date.

 

Equity instruments granted to non-employees are accounted for in accordance with ASC 505, Equity.  The final measurement date for the fair value of equity instruments with performance criteria is the date that each performance commitment for such equity instrument is satisfied or there is a significant disincentive for non-performance.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

 

Fair Value of Financial Instruments

 

Pursuant to ASC No. 820. "Fair Value Measurement and Disclosures," the Company is required to estimate the fair value of all financial instruments included on its balance sheet as of September 30, 2015. The Company's financial instruments consist of cash. The Company considers the carrying value of such amounts in the financial statements to approximate their fair value due to the short-term nature of these financial instruments.

 

Recent Pronouncements

 

In May 2014, FASB and IASB issued a new joint revenue recognition standard that supersedes nearly all GAAP guidance on revenue recognition.  The core principle of the standard is that revenue recognition should depict the transfer of goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services.  The new standard is effective for the Company for the year beginning January 1, 2018, and the effects of the standard on the Company’s consolidated financial statements are not known at this time.

 

The Company is currently evaluating the effects of the following recently issued pronouncements:
Update No. 2015-03 - Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs
Update 2015-15 - Interest - Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements
Update 2015-16—Business Combinations (Topic 805): Simplifying the Accounting for Measurement - Period Adjustments

 

The Company has no expectation that any of these items will have a material impact upon the financial statements.

 

SigmaBroadband Co.

Notes to Condensed Financial Statements

September 30, 2015

(Unaudited)

  

Note 2.  PROPERTY, PLANT, & EQUIPMENT

 

In December 2013, the Company signed an agreement to purchase certain telecommunications equipment for $10 million.  The Company is depreciating these assets over an estimated useful life of 10 years.  As of September 30, 2015 and December 31, 2014, the Company has recognized $1,750,000 and $1,000,000 in accumulated depreciation, respectively.  For the nine months ended September 30, 2015 and 2014, the Company recognized $750,000 and $750,000 in depreciation expense, respectively.

 

Note 3.  LOAN PAYABLE - STOCKHOLDER

 

At  September 30, 2015 a stockholder and officer of the Company was owed $17,538 by the Company for funds he had advanced to pay for certain expenses.  The loan bears no interest and is payable on demand.

 

At  September 30, 2015 a separate stockholder and officer of the Company was owed $5,180 by the Company for funds he had advanced to pay for certain expenses.  The loan bears no interest and is payable on demand.

 

Note 4.  NOTE PAYABLE

 

In December 2013, the Company signed an agreement to purchase certain telecommunications equipment for $10 million.  The agreement called for the Company to sign an installment agreement for $1,000,000.  The installment agreement, as amended in January 2015, calls for this balance to be amortized over a six year term with interest accruing at 8% per annum.  Additionally, under the terms of this amendment, payments will begin 48 months after the signing of the original agreement (December 2013) at which time all interest accrued until that time will be due and payable.  Interest only payments will begin in month 49 and will continue through month 72 at which time a balloon payment of the principal and any unpaid interest will be due.

 

In November 2015, the agreement was amended a second time.  This amendment gives the Company the option to pay the remaining $9,000,000 balance by issuing 10 million shares of the Company's preferred, no par value, stock within 36 months from the date of the amendment.

 

Accrued and unpaid interest totaled approximately $184,000 and $94,000 at September 30, 2015 and 2014, respectively, and is reported as accounts payable and accrued expenses.

 

Note 5.  STOCKHOLDERS' EQUITY

 

The Company has authorized 490,000,000 shares of common stock with a par value of $0.0001 per share.  At September 30, 2015 and December 31, 2014, 24,596,000 and 24,596,000 shares of common stock were issued and outstanding, respectively.

 

The Company has authorized 10,000,000 shares of preferred stock with no par value.  No shares were issued or outstanding at September 30, 2015 and 2014.

 

Note 6.  COMMITMENTS AND CONTINGENCIES

 

The Company currently leases its offices on a month to month basis from the Company's President and stockholder for $500 per month.

 

Rent expense for the nine months ended September 30, 2015 and 2014 totaled $4,500, $4,500, respectively, and was forgiven and converted to additional paid-in capital.

 

SigmaBroadband Co.

Notes to Condensed Financial Statements

September 30, 2015

(Unaudited)

 

Note 7.  INCOME TAXES

 

The deferred tax asset consists of the following:

 

		September 30, 2015				December 31, 2014
Net operating loss carryforward		$	813,000			$	477,000
Valuation allowance			(813,000	)			(477,000	)
Deferred tax asset, net		$	—			$	—

 

The income tax benefit differs from the amount computed by applying the statutory federal and state income tax rates to the loss before income taxes.  The sources and tax effects of the differences are as follows:

 

		September 30, 2015				December 31, 2014
Statutory federal income tax rate			34	%			34	%
State income taxes, net of federal taxes			6	%			6	%
Valuation allowance			(40	)%			(40	)%
Effective income tax rate			0	%			0	%

 

As of September 30, 2015, the Company has net operating loss carryforwards of approximately $2,032,000 to reduce the future federal and state taxable income through 2035.

 

The Company currently has no federal or state tax examinations in progress, nor has it had any federal or state examinations since its inception.  The Company is current on its tax filings through tax year 2014, and all of the Company's tax years are subject to federal and state tax examinations.

 

Note 8.  BASIS OF REPORTING - GOING CONCERN

 

The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the recoverability of assets and the satisfaction of liabilities in the normal course of business.

 

The Company has incurred losses from inception of approximately $2,032,000, which, among other factors, raises substantial doubt about the Company's ability to continue as a going concern.  The ability of the Company to continue as a going concern is dependent upon management's plans to raise additional capital from the sale of stock and receive additional loans from related parties.  The accompanying financial statements do not include any adjustments that might be required should the Company be unable to continue as a going concern.

 

Note 9.  SUBSEQUENT EVENTS

 

In November 2015, the agreement was amended a second time.  This amendment gives the Company the option to pay the remaining $9,000,000 balance by issuing 10 million shares of the Company's preferred, no par value, stock within 36 months from the date of the amendment.  Until the Company elects to settle the balance by issuing shares, it will continue to report the remaining balance as a liability on the balance sheet. 

ITEM 2:    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion should be read in conjunction with (i) our financial statements for the nine months ended September, 2015 and 2014 together with the notes to these financial statements; and (ii) the section entitled “Business” that appears elsewhere in this report.  The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this report. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report.  Our financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.

 

THIS FILING CONTAINS FORWARD-LOOKING STATEMENTS. THE WORDS "ANTICIPATED," "BELIEVE," "EXPECT," "PLAN," "INTEND," "SEEK," "ESTIMATE," "PROJECT," "WILL," "COULD," "MAY," AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. THESE STATEMENTS INCLUDE, AMONG OTHERS, INFORMATION REGARDING FUTURE OPERATIONS, FUTURE CAPITAL EXPENDITURES, AND FUTURE NET CASH FLOW. SUCH STATEMENTS REFLECT THE COMPANY'S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND FINANCIAL PERFORMANCE AND INVOLVE RISKS AND UNCERTAINTIES, INCLUDING, WITHOUT LIMITATION, GENERAL ECONOMIC AND BUSINESS CONDITIONS, CHANGES IN FOREIGN, POLITICAL, SOCIAL, AND ECONOMIC CONDITIONS, REGULATORY INITIATIVES AND COMPLIANCE WITH GOVERNMENTAL REGULATIONS, THE ABILITY TO ACHIEVE FURTHER MARKET PENETRATION AND ADDITIONAL CUSTOMERS, AND VARIOUS OTHER MATTERS, MANY OF WHICH ARE BEYOND THE COMPANY'S CONTROL. SHOULD ONE OR MORE OF THESE RISKS OR UNCERTAINTIES OCCUR, OR SHOULD UNDERLYING ASSUMPTIONS PROVE TO BE INCORRECT, ACTUAL RESULTS MAY VARY MATERIALLY AND ADVERSELY FROM THOSE ANTICIPATED, BELIEVED, ESTIMATED, OR OTHERWISE INDICATED. CONSEQUENTLY, ALL OF THE FORWARD-LOOKING STATEMENTS MADE IN THIS FILING ARE QUALIFIED BY THESE CAUTIONARY STATEMENTS AND THERE CAN BE NO ASSURANCE OF THE ACTUAL RESULTS OR DEVELOPMENTS.

 

The following discussion and analysis should be read in conjunction with "Selected Financial Data" and our financial statements and related notes thereto included elsewhere in this registration statement. Portions of this document that are not statements of historical or current fact are forward-looking statements that involve risk and uncertainties, such as statements of our plans, objectives, expectations and intentions. The cautionary statements made in this registration statement should be read as applying to all related forward-looking statements wherever they appear in this registration statement. Our actual results could differ materially from those anticipated in the forward-looking statements. Factors that could cause our actual results to differ materially from those anticipated include those discussed in "Risk Factors," "Business" and "Forward-Looking Statements."

 

For a discussion of the factors that could cause actual results to differ materially from the forward-looking statements see the “Liquidity and Capital Resources” section under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this item of this report and the other risks and uncertainties that are set forth elsewhere in this report or detailed in our other Securities and Exchange Commission reports and filings. We believe it is important to communicate our expectations. However, our management disclaims any obligation to update any forward-looking statements whether as a result of new information, future events or otherwise.

 

General Overview

 

SIGMABROADBAND CO. is a registered Georgia company. The Company has several million dollars in technology assets and is to be engaged in the business of providing voice, data, and digital video as a triple play bundled service to rural markets in the United States of America. We plan to offer our customers traditional cable video programming, Internet services, telephone services and IPtv, as well as advanced video services such as on demand, high definition (“HD”) television and digital video recorder (“DVR”) service. We plan to provide national and international long distance service. Our business plan include goals for increasing customers and revenue. To reach our goals, we will actively invest in our network and operations in order to improve the quality and value of the products and packages that we offer.

SIGMABROADBAND CO. has never declared bankruptcy, it has never been in receivership, and it has never been involved in any legal action or proceedings. Since becoming incorporated, has not made any significant purchase or sale of assets, nor has it been involved in any mergers, acquisitions or consolidations. SIGMABROADBAND CO. is not a blank check registrant as that term is defined in Rule 419(a)(2) of Regulation C of the Securities Act of 1933, since it has a specific business plan, purpose and substantial assets.

 

Since our inception, we have been engaged in business planning activities, including researching the industry, identifying target markets for our services and developing our SIGMABROADBAND CO. models and financial forecasts, performing due diligence regarding potential geographic locations and acquisitions most suitable for establishing our offices and identifying future sources of capital.

 

Currently, SIGMABROADBAND CO. has officers and directors who have assumed responsibility for all planning, development and operational duties, and will continue to do so throughout the beginning stages of the Company. Other than the Officers/Directors and other management team, there are no employees at the present time. We do anticipate hiring regular employees when the need arises.

 

SIGMABROADBAND CO. currently has no intention to engage in a merger or acquisition with any unidentified company. However, we may pursue strategic acquisitions that complement our current business model within the technology industry which may allow us to expand our activities, capabilities, advance our production and revenue.

 

SIGMABROADBAND CO.’s fiscal year end is December 31.

 

Industry Background

 

Approximately 100 million Americans do not have broadband at home today and most of them are living in rural communities across America. We intend to be a leading provider of cost-effective and reliable technology services for home, small to medium sized businesses in the areas we serve and to create value to our shareholders.

 

We intend to deliver innovative communications, information and entertainment. Our voice, data and video products and services offer over intelligent wireless, wireline, cable, fiber, broadband and global IP networks that meet customers' growing demand for speed, mobility, security and control. As a committed corporate citizen, we use our advanced communications services to address important issues confronting our society today, especially in rural America. We plan to follow a strategy of being first to our regional markets with technology and services first introduced in metropolitan areas by national service providers.

 

We intend to be a full service, facilities-based cable operator, local exchange and inter-exchange carrier serving both residential and commercial customers by providing voice, data and digital video services. We intend to employ the newest technology available in the marketplace today, which provides quality of service (QoS), reliability, security, redundancy and continuity of service always. In the future, we will be recognized as a leader in the data network, IP telephony and cloud-based services. Our potential customers are located in some of the country’s largest cities to families living in rural communities. We intend to establish a dominant national presence in the triple-play broadband, cable and telecom industry in America.

 

Plan of Operation

 

We are a development stage company, incorporated on October 19, 2012 and have not started operations or generated or realized any revenues from our business operations. However, we have substantial technology assets ready to deploy in the rural markets where we plan to provide our services.

 

Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for the next twelve (12) months. Our auditors’ opinion is based on the uncertainty of our ability to establish profitable operations. The opinion results from the fact that we have not generated any revenues. Accordingly, we must raise cash from sources other than operations. Our only other source for cash at this time is investments by others in our Company.

 

Our Officers and Directors are responsible for our managerial and organizational structure which will include preparation of disclosure and accounting controls under the Sarbanes Oxley Act of 2002. When these controls are implemented, they will be responsible for the administration of the controls. Should they not have sufficient experience, they may be incapable of creating and implementing the controls which may cause us to be subject to sanctions and fines by the Securities and Exchange Commission which ultimately could cause you to lose your investment.

 

Since incorporation, the Company has financed its operations originally through private capital and then, loans from stockholders and executives of the Company. As of September 30, 2015 we had $767 cash on hand.  We had total expenses of $839,855 which were related to general and administrative costs (See “Financial Statements”).

 

To date, the Company has not fully implemented its planned principal operations or strategic business plan. SIGMABROADBAND CO. is attempting to secure sufficient monetary assets to increase operations. SIGMABROADBAND CO. cannot assure any investor that it will be able to enter into sufficient business operations adequate enough to insure continued operations.  

 

Our intended plan of operations is to offer voice, data, and video services and implement the necessary sales and marketing support to begin generating revenue. If SIGMABROADBAND CO. does not produce sufficient cash flow to support its operations over the next 12 months, the Company will need to raise additional capital by issuing capital stock in exchange for cash in order to continue as a going concern. There are no formal or informal agreements to attain such financing. SIGMABROADBAND CO. cannot assure any investor that, if needed, sufficient financing can be obtained or, if obtained, that it will be on reasonable terms. Without realization of additional capital, it would be unlikely for operations to continue and any investment made by an investor would be lost in its entirety.

 

SIGMABROADBAND CO. currently does own significant plant or equipment that it can seek to sell in the near future in order to sustain its operations if not able to raise necessary capital for its business.  

 

Our management anticipates hiring employees over the next twelve (12) months as needed. Currently, the Company believes the services provided by its officers and directors appear sufficient at this time.

 

The Company has not paid for expenses on behalf of any directors.  Additionally SIGMABROADBAND CO. believes that this policy shall not materially change within the next twelve months.

 

The Company has no plans to seek a business combination with another entity in the foreseeable future.

 

Impact of Inflation

 

We believe that the rate of inflation has had negligible effect on us.  We believe we can absorb most, if not all, increased non-controlled operating costs by operating our Company in the most efficient manner possible.

 

Results of Operations

 

We have generated no significant revenues since inception; we have incurred operational expenses for the six months ended September 30, 2015 and 2014 in the amounts of $839,855 and $869,222 respectively. These expenses were attributed to continuing startup costs including general and administrative expenses.

 

General Trends and Outlook

 

We believe that our immediate outlook is extremely favorable, as we believe the competition is very limited in our market niche for broadband voice, data and video in the rural markets and only a limited number of companies competing with us in the marketplace. However, there is no assurance that such national competitor will not arrive in the future. We do not anticipate any major changes in the triple-play telecommunications industry. We believe that 2015 and beyond will be a significant growth year(s) for us. As we gain strength and stability in the regional rural markets we intend to expand our influence in markets throughout the U.S.

 

Liquidity and Capital Resources

 

The financial statements have been prepared assuming the company will continue as a going concern as per its business plan. For the six months ended September 30, 2015, the company has a net loss $839,855. The company has financed its activities from private funding and proceeds from the issuance of its common stock.

 

The company intends to finance its future business and development activities and its working capital needs largely from the sale of equity securities until such time that funds generated from operations are sufficient to fund working capital requirements.

 

ITEM 3:    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Market risk represents the risk of changes in value of a financial instrument, derivative or non-derivative, caused by fluctuations in interest rates, foreign exchange rates and equity prices. Changes in these factors could cause fluctuations in results of our operations and cash flows. In the ordinary course of business, we are not exposed to interest rate and foreign currency exchange rate risks.

 

ITEM 4.    CONTROLS AND PROCEDURES

 

Based upon the required evaluation of our disclosure controls and procedures, our President and Chief Executive Officer and Chief Financial Officer concluded that as of September 30, 2015 our disclosure controls and procedures were adequate and effective to ensure that information was gathered, analyzed and disclosed on a timely basis.

 

There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during our fiscal quarter ended September 30, 2015, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

Evaluation of disclosure controls and procedures

 

Under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15 (e) and 15d-15(e) under the Exchange Act. Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that, at September 30, 2015, such disclosure controls and procedures were not effective, based on our delinquent filings. Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

 

Management's Report on Internal Control over Financial Reporting

 

The Company's management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) promulgated under the Exchange Act of 1934 as a process designed by or under the supervision of the company’s principal executive and principal financial officers and effected by the company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with generally accepted accounting principles in the United States of America and included those policy and procedures that:

 

•

Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transaction and dispositions of the assets of the company.

•

Provide reasonable assurance that transactions are recorded as necessary to permit preparation of finical statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

•

Provide reasonable assurance regarding prevention for timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements

 

A control system, no matter how well conceived or operated, can provide only reasonable, not absolute assurance that the objectives of the control system are met under all potential conditions, regardless of how remote, and may not prevent or detect all errors and all fraud. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been prevented or detected. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States of America.

 

As of September 30, 2015 management assessed the effectiveness of our internal controls over financial reporting based on the criteria for effective internal control over financial reporting established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organization of the Treadway Commission (“COSO”) and SEC guidance on conducting such assessments. Based on that evaluation, they concluded that, during the period covered by this report, such internal controls and procedures were not effective to detect the appropriate application of US GAAP rules.

 

Our disclosure controls and procedures are designed to provide reasonable, not absolute, assurance that the objectives of our disclosure control system are met. Because of inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected. Based on their evaluation as of the end of the period covered by this report, management concluded that our disclosure controls and procedures were sufficiently effective to provide reasonable assurance that the objectives of our disclosure control system were met.

 

Changes in Internal Control over Financial Reporting

 

No change in the Company's internal control over financial reporting occurred during the quarter ended September 30, 2015, that materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II—OTHER INFORMATION

 

ITEM 1.    LEGAL PROCEEDINGS

The Company is not involved in any legal proceedings and is not aware of any pending or threatened claims.

 

The Company expects and may be subject to legal proceedings and claims from time to time in the ordinary course of its business, including, but not limited to, claims of alleged infringement of the trademarks and other intellectual property rights of third parties by the Company and its licensees. Such claims, even if not meritorious, could result in the expenditure of significant financial and managerial resources.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

There have been no sales of unregistered securities during the quarter ended September 30, 2015.

 

During the nine months period ended September 30, 2015, there was no modification of any instruments defining the rights of holders of the Company's common stock and no limitation or qualification of the rights evidenced by the Company's common stock as a result of the issuance of any other class of securities or the modification thereof.

 

During the period covered by this filing, the Company did not sell any securities that were not registered under the Securities Act.

 

ITEM 3. DEFAULT UPON SENIOR SECURITIES

 

There have been no defaults in any material payments during the covered period.

 

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY SHAREHOLDERS

 

There have been no matters submitted to a vote of the Company’s shareholders.

 

ITEM 5. OTHER INFORMATION

 

Effective October 29, 2015, the Company engaged MartinelliMick PLLC, of Spokane, Washington, as our independent registered public accounting firm for the fiscal year ended December 31, 2015. During the Company’s two most recent fiscal years and the subsequent interim period through October 29, 2015, the Company did not consult with MartinelliMick PLLC with respect to any of the matters or events set forth in Item 304(a)(2) of Regulation S-K.

 

The Company does not have any other material information to report with respect to the nine months period ended September 30, 2015.

  

SIGNATURES

 

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned, thereto duly authorized:

  

SIGMABROADBAND CO.
November 9, 2015
By:	/s/ Jeffery A. Brown
	Jeffery A,. Brown
	President, Secretary,
	Principal Executive Officer,
	and Director
By:	/s/ Timothy D. Valley
	Timothy D. Valley
	Chief Financial Officer and
	Principal Accounting Officer

  

 EXHIBITS

 

INDEX OF EXHIBITS

 

ITEM 6. Exhibits

 

Exhibit No.				Description
	31.1			Certification by Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	32.1			Certification by Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
	31.2			Certification by Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	32.2			Certification by Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

Exhibit 31.1

 

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES OXLEY ACT OF

2002 AND RULE 13A-14 OF THE EXCHANGE ACT OF 1934

 

CERTIFICATION

 

I, Jeffery A. Brown, certify that: 

1.

I have reviewed this Quarterly Report on Form 10-Q of SigmaBroadband Co.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

Disclosed in this report any change in the registrant‘s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

SIGMABROADBAND CO.

 

November 23, 2015

 

By: /s/ Jeffery A. Brown

Jeffery A. Brown

President, Secretary, Principal Executive Officer, and Director

Exhibit 31.2

 

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES OXLEY ACT OF

2002 AND RULE 13A-14 OF THE EXCHANGE ACT OF 1934

 

CERTIFICATION

 

I, Timothy D. Valley, certify that:

1.

I have reviewed this Quarterly Report on Form 10-Q of SigmaBroadband Co.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

Disclosed in this report any change in the registrant‘s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

SIGMABROADBAND CO.

 

November 23, 2015

 

By: /s/ Timothy D. Valley

Timothy D. Valley

Chief Financial Officer and Principal Accounting Officer

 

 

Exhibit 32.1

 

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S. C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of SigmaBroadband Co., (the "Company") on Form 10-Q for the period ended September 30, 2015 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Jeffery A. Brown, President and Principal Executive Officer of the Company, certify, pursuant to 18 U.S. C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002, that, to my knowledge:

 

(1)

The Report fully complies with the requirements of Section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

SIGMABROADBAND CO.

 

November 23, 2015

 

By: /s/ Jeffery A. Brown

Jeffery A. Brown

President, Secretary, Principal Executive Officer, and Director

Exhibit 32.2

 

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S. C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of SigmaBroadband Co., (the "Company") on Form 10-Q for the period ended September 30, 2015 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Timothy D. Valley, President and Principal Executive Officer of the Company, certify, pursuant to 18 U.S. C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002, that, to my knowledge:

 

(1)

The Report fully complies with the requirements of Section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

SIGMABROADBAND CO.

 

November 23, 2015

 

By: /s/ Timothy D. Valley

Timothy D. Valley

Chief Financial Officer and

Principal Accounting Officer