Nevada
|
|
88-0343702
|
(State
or other jurisdiction of
incorporation
or organization)
|
|
(IRS
Employer
Identification
No.)
|
4260
Polaris Avenue
Las
Vegas, Nevada 89103
|
|
(702)
895-8884
|
(Address
of principal executive offices)
|
|
(Issuer’s
telephone number)
|
Large
accelerated filer ¨
|
|
Accelerated
filer ¨
|
Non-accelerated
filer ¨
|
|
Smaller
reporting company x
|
Page
|
||
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
|
1
|
|
PART
I. FINANCIAL INFORMATION
|
2
|
|
Item
1.
|
Financial
Statements
|
2
|
|
Condensed
Balance Sheets as of June 30, 2008 and December 31, 2007
|
2
|
|
Condensed
Statements of Operations for Six Months ended June 30, 2008 and
2007
|
3
|
|
Condensed
Statements of Cash Flows for the Six Months ended June 30, 2008 and
2007
|
4
|
|
Notes
to the Condensed Financial Statements
|
5
|
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
10
|
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk.
|
15
|
Item
4T.
|
Controls
and Procedures
|
15
|
PART
II. OTHER INFORMATION
|
16
|
|
Item
1.
|
Legal
Proceedings
|
16
|
Item
1A.
|
Risk
Factors
|
16
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
16
|
Item
3.
|
Defaults
Upon Senior Securities
|
16
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders.
|
16
|
Item
5.
|
Other
Information
|
17
|
Item
6.
|
Exhibits
|
17
|
SIGNATURES
|
17
|
June 30,
|
December 31,
|
||||||
2008
|
2007
|
||||||
|
(Unaudited)
|
|
(Audited)
|
|
|||
Assets
|
|||||||
Current
assets:
|
|||||||
Cash
|
$
|
-
|
$
|
69,959
|
|||
Accounts
receivable, net of allowance for doubtful acccounts of $32,947 at
June 30,
2008 and December 31, 2007
|
44,584
|
17,852
|
|||||
Prepaid
expenses
|
58
|
11,839
|
|||||
Total
current assets
|
44,642
|
99,650
|
|||||
Fixed
assets, net of accumulated depreciation of $18,763 and $15,534 at
June 30,
2008 and December 31, 2007, respectively
|
2,065
|
5,294
|
|||||
$
|
46,707
|
$
|
104,944
|
||||
Liabilities
and Stockholders' Equity
|
|||||||
Current
liabilities:
|
|||||||
Deferred
revenues
|
$
|
6,667
|
$
|
33,333
|
|||
Checks
drawn in excess of available funds
|
753
|
-
|
|||||
Accounts
payable
|
339,099
|
341,675
|
|||||
Accrued
expenses
|
348,119
|
303,173
|
|||||
Current
maturities of long term debt
|
5,000
|
5,000
|
|||||
Total
current liabilities
|
699,638
|
683,181
|
|||||
Long
term debt, net of discount of $57,121 and $84,705 at June 30, 2008
and
December 31, 2007, respectively
|
372,879
|
345,295
|
|||||
Stockholders'
(deficit):
|
|||||||
Preferred
stock, $0.001 par value, 2,000,000 shares authorized; 1,200,000 and
800,000 shares issued and outstanding, respectively
|
1,200
|
800
|
|||||
Common
stock, $0.001 par value, 150,000,000 shares authorized; 30,389,342
and
29,267,569 shares issued and outstanding, respectively
|
30,390
|
29,267
|
|||||
Additional
paid-in capital
|
14,501,688
|
14,165,616
|
|||||
Accumulated
(deficit)
|
(15,559,088
|
)
|
(15,119,215
|
)
|
|||
(1,025,810
|
)
|
(923,532
|
)
|
||||
$
|
46,707
|
$
|
104,944
|
For the three months ended
|
For the six months ended
|
||||||||||||
June 30,
|
June 30,
|
||||||||||||
2008
|
2007
|
2008
|
2007
|
||||||||||
|
|
|
|
||||||||||
Revenue
|
|||||||||||||
Network
|
$
|
21,625
|
$
|
331
|
$
|
39,010
|
$
|
16,725
|
|||||
Production
and other
|
50,893
|
63,510
|
156,905
|
133,681
|
|||||||||
Total
revenue
|
72,518
|
63,841
|
195,915
|
150,406
|
|||||||||
Expenses:
|
|||||||||||||
Direct
operating costs
|
53,760
|
70,614
|
93,961
|
103,880
|
|||||||||
General
and administrative
|
71,111
|
140,462
|
190,834
|
245,577
|
|||||||||
Officer
salaries
|
62,454
|
175,000
|
184,450
|
250,000
|
|||||||||
Salaries
and wages
|
18,101
|
28,400
|
42,413
|
46,954
|
|||||||||
Consulting
services
|
21,757
|
170,328
|
118,825
|
297,494
|
|||||||||
Consulting
services, related party
|
-
|
19,648
|
26,289
|
113,690
|
|||||||||
Rent
|
19,536
|
19,304
|
38,285
|
31,956
|
|||||||||
Depreciation
and amortization
|
1,549
|
9,303
|
3,229
|
22,935
|
|||||||||
Total
operating expenses
|
248,268
|
633,059
|
698,286
|
1,112,486
|
|||||||||
Net
operating (loss)
|
(175,750
|
)
|
(569,218
|
)
|
(502,371
|
)
|
(962,080
|
)
|
|||||
Other
income (expense):
|
|||||||||||||
Interest
expense
|
(7,617
|
)
|
(18,925
|
)
|
(14,624
|
)
|
(18,925
|
)
|
|||||
Gain
on debt settlement
|
18,000
|
74,610
|
104,706
|
74,610
|
|||||||||
Financing
costs
|
(13,792
|
)
|
(4,687
|
)
|
(27,584
|
)
|
(27,584
|
)
|
|||||
Total
other income (expenses)
|
(3,409
|
)
|
50,998
|
62,498
|
28,101
|
||||||||
Net
(loss)
|
$
|
(179,159
|
)
|
$
|
(518,220
|
)
|
$
|
(439,873
|
)
|
$
|
(933,979
|
)
|
|
Weighted
average number of common shares outstanding - basic and fully
diluted
|
30,221,310
|
25,409,927
|
29,890,547
|
24,501,957
|
|||||||||
Net
(loss) per share - basic & fully diluted
|
$
|
(0.01
|
)
|
$
|
(0.02
|
)
|
$
|
(0.01
|
)
|
$
|
(0.04
|
)
|
|
For the six months ended
|
||||||
June 30,
|
|||||||
2008
|
2007
|
||||||
Cash flows from operating
activities
|
|||||||
Net
(loss)
|
$
|
(439,873
|
)
|
$
|
(933,979
|
)
|
|
Adjustments
to reconcile net (loss) to net cash (used in) operating
activities:
|
|||||||
Gain
on debt settlements
|
(104,706
|
)
|
(74,610
|
)
|
|||
Depreciation
and amortization expense
|
3,229
|
22,935
|
|||||
Stock
issued for services
|
73,450
|
301,516
|
|||||
Stock
issued for services, related party
|
97,255
|
257,729
|
|||||
Options
issued for services
|
99,405
|
148,783
|
|||||
Options
issued for services, related party
|
67,485
|
61,642
|
|||||
Amortization
of warrants
|
-
|
54,179
|
|||||
Amortization
of beneficial conversion feature
|
27,584
|
27,584
|
|||||
Decrease
(increase) in assets:
|
|||||||
Accounts
receivable
|
(26,732
|
)
|
(10,152
|
)
|
|||
Prepaid
expenses
|
11,781
|
(5,635
|
)
|
||||
Increase
(decrease) in liabilities:
|
|||||||
Checks
drawn in excess of available funds
|
753
|
-
|
|||||
Deferred
revenues
|
(26,666
|
)
|
40,000
|
||||
Accounts
payable
|
102,130
|
(47,261
|
)
|
||||
Accrued
expenses
|
44,946
|
62,933
|
|||||
Net
cash (used in) operating activities
|
(69,959
|
)
|
(94,336
|
)
|
|||
Cash
flows from financing activities
|
|||||||
Proceeds
from long term debt
|
-
|
12,500
|
|||||
Proceeds
from the sale of common stock
|
-
|
67,100
|
|||||
Net
cash provided by financing activities
|
-
|
79,600
|
|||||
Net
increase in cash
|
(69,959
|
)
|
(14,736
|
)
|
|||
Cash
- beginning
|
69,959
|
16,507
|
|||||
Cash
- ending
|
$
|
-
|
$
|
1,771
|
|||
Supplemental
disclosures:
|
|||||||
Interest
paid
|
$
|
-
|
$
|
4,245
|
|||
Income
taxes paid
|
$
|
-
|
$
|
-
|
|||
Non-cash
transactions:
|
|||||||
Stock
issued for services
|
$
|
73,450
|
$
|
301,516
|
|||
Stock
issued for services, related party
|
$
|
97,255
|
$
|
257,729
|
|||
Stock
options issued for services
|
$
|
99,405
|
$
|
148,783
|
|||
Stock
options issued for services, related party
|
$
|
67,485
|
$
|
61,642
|
2008
|
2007
|
||||||
5%
unsecured convertible debentures, due in September 2009, convertible
into
333,333 shares of common stock at any time prior to maturity based
on a
conversion price of $0.15 per share. Accrued interest is convertible
as
well at a conversion price of $0.15 per share.
|
$
|
50,000
|
$
|
50,000
|
|||
5%
unsecured convertible debentures, due in August 2009, convertible
into
400,000 shares of common stock at any time prior to maturity based
on a
conversion price of $0.15 per share. Accrued interest is convertible
as
well at a conversion price of $0.15 per share.
|
60,000
|
60,000
|
|||||
5%
unsecured convertible debentures, due in June 2009, convertible
into
200,000 shares of common stock at any time prior to maturity based
on a
conversion price of $0.15 per share. Accrued interest is convertible
as
well at a conversion price of $0.15 per share.
|
30,000
|
30,000
|
|||||
5%
unsecured convertible debentures, due in June 2009, convertible
into
100,000 shares of common stock at any time prior to maturity based
on a
conversion price of $0.15 per share. Accrued interest is convertible
as
well at a conversion price of $0.15 per share.
|
15,000
|
15,000
|
|||||
5%
unsecured convertible debentures, due in May 2009, convertible
into
166,667 shares of common stock at any time prior to maturity based
on a
conversion price of $0.15 per share. Accrued interest is convertible
as
well at a conversion price of $0.15 per share.
|
25,000
|
25,000
|
|||||
5%
unsecured convertible debentures, due in March 2009, convertible
into
571,429 shares of common stock at any time prior to maturity based
on a
conversion price of $0.35 per share. Accrued interest is convertible
as
well at a conversion price of $0.35 per share.
|
200,000
|
200,000
|
|||||
5%
unsecured convertible debentures, due in February 2009, convertible
into
71,429 shares of common stock at any time prior to maturity based
on a
conversion price of $0.35 per share. Accrued interest is convertible
as
well at a conversion price of $0.35 per share.
|
25,000
|
25,000
|
|||||
5%
unsecured convertible debentures, due in February 2009, convertible
into
71,429 shares of common stock at any time prior to maturity based
on a
conversion price of $0.35 per share. Accrued interest is convertible
as
well at a conversion price of $0.35 per share.
|
25,000
|
25,000
|
|||||
Unsecured
demand note due to a former Officer of the Company. The non interest
bearing debt is expected to be repaid in the near term.
|
5,000
|
5,000
|
|||||
Total
debt
|
435,000
|
435,000
|
|||||
Less:
current portion
|
5,000
|
5,000
|
|||||
Long-term
debt, less current portion
|
430,000
|
430,000
|
|||||
Less:
discount on beneficial conversion feature
|
57,121
|
84,705
|
|||||
Long-term
debt, less discount on beneficial conversion feature
|
$
|
372,879
|
$
|
345,295
|
2008
|
$
|
5,000
|
||
2009
|
430,000
|
|||
2010
|
-
|
|||
2011
|
-
|
|||
Thereafter
|
-
|
|||
$
|
435,000
|
|
Shares
Underlying
|
|||||||||||||||||||||||
Shares
Underlying Options and Warrants Outstanding
|
Options
and Warrants Exercisable
|
|||||||||||||||||||||||
Weighted
|
||||||||||||||||||||||||
Shares
|
Average
|
Weighted
|
Shares
|
Weighted
|
||||||||||||||||||||
Underlying
|
Remaining
|
Average
|
Underlying
|
Average
|
||||||||||||||||||||
Range
of
|
Options
|
Contractual
|
Exercise
|
Options
|
Exercise
|
|||||||||||||||||||
Exercise Prices
|
Outstanding
|
Life
|
Price
|
Exercisable
|
Price
|
|||||||||||||||||||
$
|
0.15
- 0.50
|
|
|
8,068,999
|
2.99
years
|
|
$
|
0.27
|
|
|
8,068,999
|
|
$
|
0.27
|
|
2008
|
2007
|
|||||
Average
risk-free interest rates
|
2.02
|
%
|
5.07
|
%
|
|||
Average
expected life (in years)
|
2
|
2
|
|||||
Average
Volatility
|
180
|
%
|
194
|
%
|
|
Weighted
|
||||||
|
Average
|
||||||
|
Number
|
Exercise
|
|||||
|
Of
Shares
|
Price
|
|||||
Balance,
December 31, 2007
|
8,776,499
|
$
|
0.29
|
||||
Options
cancelled
|
-0-
|
-0-
|
|||||
Options
expired
|
(1,832,500
|
)
|
(0.32
|
)
|
|||
Options
vested during the period
|
1,125,000
|
0.20
|
|||||
Balance,
June 30, 2008
|
8,068,999
|
0.28
|
|||||
Exercisable,
June 30, 2008
|
8,068,999
|
$
|
0.28
|
|
For
the Three Months Ended
June
30,
|
Increase
/
|
||||||||
|
2008
|
|
2007
|
(Decrease)
|
||||||
Revenues
|
$
|
72,518
|
$
|
63,841
|
$
|
8,677
|
||||
|
||||||||||
Direct
operating costs
|
53,760
|
70,614
|
(16,854
|
)
|
||||||
General
and administrative
|
71,111
|
140,462
|
(69,351
|
)
|
||||||
Salaries
and wages
|
80,555
|
203,400
|
(122,845
|
)
|
||||||
Consulting
services
|
21,757
|
189,976
|
(168,219
|
)
|
||||||
Rent
|
19,536
|
19,304
|
232
|
|||||||
Depreciation
and amortization
|
1,549
|
9,303
|
(7,754
|
)
|
||||||
|
||||||||||
Total
Operating Expenses
|
248,268
|
633,059
|
(384,468
|
)
|
||||||
|
||||||||||
Net
Operating (Loss)
|
(175,750
|
)
|
(569,218
|
)
|
(393,468
|
)
|
||||
Total
other income (expense)
|
(3,409
|
)
|
50,998
|
(54,407
|
)
|
|||||
|
||||||||||
Net
(Loss)
|
$
|
(179,159
|
)
|
$
|
(518,220
|
)
|
$
|
(339,061
|
)
|
|
For the Six Months Ended
June 30,
|
Increase /
|
||||||||
|
2008
|
2007
|
(Decrease)
|
|||||||
Revenues
|
$
|
195,915
|
$
|
150,406
|
$
|
45,509
|
||||
|
||||||||||
Direct
operating costs
|
93,961
|
103,880
|
(9,919
|
)
|
||||||
General
and administrative
|
190,834
|
245,577
|
(54,743
|
)
|
||||||
Salaries
and wages
|
226,863
|
296,954
|
(70,091
|
)
|
||||||
Consulting
services
|
145,114
|
411,184
|
(266,070
|
)
|
||||||
Rent
|
38,285
|
31,956
|
6,329
|
|||||||
Depreciation
and amortization
|
3,229
|
22,935
|
(19,706
|
)
|
||||||
|
||||||||||
Total
Operating Expenses
|
698,286
|
1,112,486
|
(414,200
|
)
|
||||||
|
||||||||||
Net
Operating (Loss)
|
(502,371
|
)
|
(962,080
|
)
|
(459,709
|
)
|
||||
Total
other income (expense)
|
62,498
|
28,101
|
34,397
|
|||||||
|
||||||||||
Net
(Loss)
|
$
|
(439,873
|
)
|
$
|
(933,979
|
)
|
$
|
(494,106
|
)
|
June 30, 2008
|
December 31, 2007
|
||||||
Total
Assets
|
$
|
46,707
|
$
|
104,944
|
|||
|
|||||||
Accumulated
(Deficit)
|
$
|
(15,559,088
|
)
|
$
|
(15,119,215
|
)
|
|
|
|||||||
Stockholders’
Equity
|
$
|
(1,025,810
|
)
|
$
|
(923,532
|
)
|
|
|
|||||||
Working
Capital (Deficit)
|
$
|
(654,996
|
)
|
$
|
(583,531
|
)
|
31.1
|
Certifications
pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange
Act
of 1934, as amended, as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
|
|
|
32.1
|
Players
Network
|
|
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/s/
Mark Bradley
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Mark
Bradley
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Chief
Executive Officer
(Principal
Executive Officer)
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