BOLDFACE GROUP, INC.

CIK:0001423107|SEC Filings

Condensed Consolidated Statements of Operations (Unaudited) (USD $)	3 Months Ended		9 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Revenues
Gross revenues	$ 752,877	$ 3,608,245	$ 4,273,852	$ 5,362,057
Discounts	439,105	584,983	1,221,625	812,526
Revenues, net of discounts	313,772	3,023,262	3,052,227	4,549,531
Cost of Goods Sold
Cost of goods sold	615,942	1,332,377	2,516,153	2,126,773
Gross Profit	(302,170)	1,690,885	536,074	2,422,758
Operating expenses:
Selling expenses	18,843	243,463	369,359	585,241
Research and development	3,006	13,909	14,195	36,921
Royalty expense	419,036	157,895	815,370	480,704
Professional fees	337,222	818,666	1,004,927	1,427,389
General and administrative expenses	721,305	817,995	2,418,327	2,210,174
Depreciation and amortization expense	126,843	671,709	361,812	745,885
Product development fee - related party	140,000	210,000	640,000	622,700
Total Operating Expense	1,766,255	2,933,637	5,623,990	6,109,014
Loss from operations	(2,068,425)	(1,242,752)	(5,087,916)	(3,686,256)
Other (income) / expenses:
Interest expense, net of interest income	388,073	661,838	1,170,555	957,973
Loss from debt extinguishment	2,760,640		2,760,640
Derivative liability (gain) / loss	(462,726)	(3,646,420)	(1,708,651)	(3,299,793)
Net (loss) / income	(4,754,412)	1,741,830	(7,310,460)	(1,344,436)
Preferred Dividend	78,126		78,126
Net (loss) / income attributable to common shareholders - basic and diluted	$ (4,832,538)	$ 1,741,830	$ (7,388,586)	$ (1,344,436)
Net (loss) / income per share attributable to common shareholders - basic and diluted	$ (3.11)	$ 1.97	$ (4.77)	$ (1.54)
Weighted average number of common shares used in computing - basic and diluted	1,555,675	883,074	1,547,820	872,201

Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $)	9 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Cash flows from operating activities:
Net loss	$ (7,310,460)	$ (1,344,436)
Adjustments to reconcile net loss tonet cash used in operating activities:
Stock compensation expense	472,397	452,087
Shares issued for services	46,387	253,455
Inventory reserves	129,228
Amortization of license acquisition costs	6,128	1,998
Amortization of deferred financing costs	198,836	656,623
Amortization of debt discount	753,437	551,502
Depreciation	361,811	89,262
Loss from debt extinguishment	2,760,640
Derivative liability (gain) / loss	(1,708,651)	(3,299,793)
Change in operating assets and liabilities:
Accounts receivable	63,626	(101,553)
Due from factor, net	(89,110)	(526,273)
Prepaid royalty	373,370	380,704
License acquisition costs		(8,902)
Inventory	106,834	(1,837,553)
Deposit		(1,500)
Prepaid expenses and other current assets	48,935	(91,667)
Prepaid inventory	(30,559)	(65,686)
Accounts payable	1,792,028	2,144,990
Customer deposits	50,568
Accrued expenses and other current liabilities	990,247	433,868
Due to Gold Grenade, LLC	234,550	(108,475)
Net cash used in operating activities	(749,758)	(2,421,349)
Cash flows from investing activities:
Acquisition of property and equipment	(189,241)	(876,549)
Net cash used in investing activities	(189,241)	(876,549)
Cash flows from financing activities:
Issuance of common stock, net of financing fees		783,480
Purchase of treasury stock and warrants		(125,000)
Proceeds from short term loans		1,335,000
Paydown of short term loans		(1,335,000)
Payments of preferred dividends	(78,126)
Issuance of bridge note	1,000,000
Payments for deferred financing fees in relation to bridge note issuance	(120,405)
Issuance of convertible debt	550,000	2,605,284
Payments for deferred financing fees in relation to convertible debt issuance	(62,065)
Net cash provided by financing activities	1,289,404	3,263,764
Net change in cash and cash equivalents	350,405	(34,134)
Cash at beginning of period	388,892	71,532
Cash at end of period	739,297	37,398
Supplemental disclosures of cash flow information:
Interest	129,539	225,078
Income Taxes
Non-cash financing activities:
Conversion of bridge notes and convertible debt	1,953,143	1,925,030
Contribution from shareholders for deferred financing cost		1,537,940
Other non-cash deferred financing fees from issuance of convertible debt		194,381
Fair value of conversion features and warrants issued in connection with equity and debt financing	$ 224,899	$ 5,494,386

Condensed Consolidated Balance Sheets (USD $)	Mar. 31, 2014	Jun. 30, 2013
Current assets:
Cash and cash equivalents	$ 739,297	$ 388,892
Accounts receivable, net of reserves for discounts and allowances	36,461	100,087
Due from factor, net	253,200	164,090
Inventory (net of reserve of $495,000 and $365,772, as of March 31, 2014 and June 30, 2013, respectively)	1,712,846	1,948,908
Prepaid inventory	289,090	258,531
Prepaid expenses and other current assets	40,851	89,786
Prepaid royalty	5,590	378,960
Current portion of deferred financing costs, net	37,394	29,899
Total current assets	3,114,729	3,359,153
Property and equipment, net	496,463	669,033
Deferred financing costs, net	120,166	328,893
License acquisition costs	18,376	24,504
Total assets	3,749,734	4,381,583
Current liabilities:
Deferred revenue	50,568
Accounts payable	4,273,880	2,481,852
Accrued expenses and other current liabilities	1,796,800	806,553
Current portion of convertible debt, net of debt discount ($145,729 and $116,524, as of March 31, 2014 and June 30, 2013, respectively)	197,128	23,476
Bridge note, net of debt discount ($231,349 and $0, as of March 31, 2014 and June 30, 2013, respectively)	888,651
Due to Gold Grenade, LLC (related party)	234,550
Total current liabilities	7,441,577	3,311,881
Long-Term Liabilities
Convertible debt, net of debt discount ($0 and $1,281,760, as of March 31, 2014 and June 30, 2013, respectively)		258,240
Derivative liability	119,559	1,660,440
Total Long-Term Liabilities	119,559	1,918,680
Total Liabilities	7,561,136	5,230,561
Preferred stock, $.001 par value, 10,000,000 shares authorized, 3,906 and 0 issued and outstanding as of March 31, 2014 and June 30, 2013 respectively	3,906,004
Commitments and Contingencies (Note 8)
Shareholders' deficit:
Common stock, $.001 par value, 3,000,000 shares authorized, 1,575,250 and 1,553,015 shares issued as of March 31, 2014 and June 30, 2013 respectively	1,575	155,301
Treasury stock, at cost - 9,997 and 9,997 shares as of March 31, 2014 and June 30, 2013, respectively	(228,284)	(228,284)
Additional paid in capital	7,437,579	6,841,822
Accumulated deficit	(14,928,276)	(7,617,817)
Total shareholders' deficit	(7,717,406)	(848,978)
Total liabilities and shareholders' deficit	$ 3,749,734	$ 4,381,583