U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

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

For the ~~quarterly~~Quarter period ended June ~~December 31~~30, ~~2012~~2013

[ ]	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 814-00724

MORRIS BUSINESS DEVELOPMENT COMPANY

(Exact name of registrant as specified in its charter)

California		33-0795854
California (State or other jurisdiction of incorporation or organization)		33-0795854 (I.R.S. Employer Identification No.)
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
220 Nice Lane #108 Newport Beach, CA (Address of principal executive offices)		92663 (Zip Code)

220 Nice Lane #108 Newport Beach, CA		92663
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (949) 444-9090

~~Registrant’s~~Indicate by check mark if the registrant is a well-known ~~telephone~~seasoned ~~number~~issuer, ~~including~~as ~~area~~defined ~~code~~in ~~(310)~~Rule ~~493-2244~~405 of the Securities Act. Yes [ ] No [X]

~~Check whether~~Indicate ~~the~~by ~~issuer~~check ~~(1)~~mark ~~has~~if ~~filed~~the ~~all~~registrant ~~reports~~is ~~required~~not required to befile ~~filed~~reports bypursuant to 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 requirements for the past 90 days~~. Yes [X ] No [ X].

Indicate by check mark whether the registrant is(1) ahas ~~large~~filed all ~~accelerated~~reports ~~filer,~~required anto ~~accelerated~~be ~~filer,~~filed by Section 13 or a15(d) ~~non-accelerated~~of ~~filer.~~the ~~See~~Securities ~~definition~~Exchange Act of 1934 during the preceding 12 months (or ~~“accelerated~~for ~~filer~~such -shorter ~~large~~period ~~accelerated~~that ~~filer”~~the inregistrant ~~Rule~~was ~~12b-~~required to file such reports), and (2) ofhas been subject to such filing requirements for the ~~Exchange~~past ~~Act~~90 days. ~~(Check one):~~ Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [ ]

Accelerated filer [ ]

Non-accelerated filer [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]

~~Applicable~~State the aggregate market value of voting and non-voting ~~only~~common equity held by non-affiliates computed by reference to ~~issuers~~the ~~involved~~price inat ~~bankruptcy~~which ~~proceedings~~the ~~during~~common equity was last sold, or the ~~preceding~~average bid ~~five~~and ~~years:~~asked price of such common equity, as of the last business day of the registrant’s most recently completed fiscal quarter. $14,120, based on the closing price of $0.03 of our common stock on March 31, 2013.

Applicable only to registrants involved in bankruptcy proceedings during the preceding five years:

Indicate by check mark whether the registrant filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.
Yes [ ] No [ ]

Applicable only to corporate registrants:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of June 30, 2013, there were 28,667,000 shares of common stock, par value $0.001, issued and outstanding.

Documents incorporated by reference

List hereunder the following documents if incorporated by reference and the Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) Any annual report to security holders: (2) Any proxy or information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or (c) under the Securities Act of 1933. the listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended December 24, 1980). None

Applicable only to corporate issuers:

~~Indicate the~~As ~~number~~ of ~~shares~~August ~~outstanding of each of the issuer’s classes of common stock~~11, ~~as of the latest practicable date. As of February 14,~~ 2013, there were 25, ~~666,~~667 ,000 shares of common stock, par value $0.001, issued and outstanding.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION			3
ITEM 1	Financial Statements		3
ITEM 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3	4
ITEM 3	Quantitative and Qualitative Disclosures About Market Risk	27	31
ITEM 4	Controls and Procedures	27	32
PART II – OTHER INFORMATION			32
ITEM 1	Legal proceedings	28	32
ITEM 1A	Risk Factors	28	32
ITEM 2	Unregistered Sales of Equity Securities and Use of Proceeds	28	32
ITEM 3	Defaults Upon Senior Securities	28	32
ITEM 4	Submission of Matters to a Vote of Security Holders	28	32
ITEM 5	Other Information	28	32
ITEM 6	Exhibits	28	32

PART I – FINANCIAL INFORMATION

This Quarterly Report includes forward-looking statements within the meaning of the Securities Exchange Act of 1934 (the “Exchange Act”). These statements are based on management’s beliefs and assumptions, and on information currently available to management. Forward-looking statements include the information concerning possible or assumed future results of operations of the Company set forth under the heading “Management’s

Discussion and Analysis of Financial Condition or Plan of Operation.” Forward-looking statements also include statements in which words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “consider” or similar expressions are used.

Forward-looking statements are not guarantees of future performance. They involve risks, uncertainties and assumptions. The Company’s future results and shareholder values may differ materially from those expressed in these forward-looking statements. Readers are cautioned not to put undue reliance on any forward-looking statements.

ITEM 1 Financial Statements and Financial Notes

Condensed Balance Sheets June 30, 2013 (Unaudited) and March 31, 2013			F-1

Condensed Statements of Operations for the Three Month Periods Ended June 30, 2013 and 2012 and for the period from inception (April 1, 2012) through June 30, 2013 (Unaudited)			F-2

Condensed Statements of Cash Flows for the Three Month Periods Ended June 30, 2013 and 2012 and for the period from inception (April 1, 2012) through June 30, 2013 (Unaudited)			F-3

Notes to Unaudited Condensed Financial Statements			F-4

MORRIS BUSINESS DEVELOPMENT COMPANY

(A Development Stage Company)

Balance Sheet

as at December 31, 2012 (unaudited) and March 31, 2012

	June 30, 2013			March 31, 2013
	(Unaudited)
ASSETS
Current Assets
Cash	$	2,683		$	3,706
Marketable Securities		-			-
Accounts Receivable		4,000			3,000

TOTAL ASSETS	$	6,683		$	6,706

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts Payable and Accrued Expenses	$	4,320		$	4,170
Total Liabilities		4,320			4,170

Stockholders’ Equity
Preferred Stock, $0.001 par value, 10,000,000 shares authorized; none issued and outstanding
Common Stock, $0.001 par value; 40,000,000 shares authorized; 28,667,000 shares issued and outstanding at June 30, 2013 and March 31, 2013.		28,667			28,667
Additional Paid-in Capital		933,959			933,959
Accumulated Deficit		(924,391	)		(924,218	)
Accumulated other comprehensive loss		(35,872	)		(35,872	)
Total Stockholders’ Equity		2,363			2,536

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	6,683		$	6,706

	December 31, 2012			March 31, 2012
	(Unaudited)
ASSETS
Current Assets
Cash and cash equivalents	$	3,791		$	5,426
Marketable Security		-			12,500
Accounts Receivable		3,000			7,500
Total Current Assets		6,791			25,426
TOTAL ASSETS	$	6,791		$	25,426
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Liabilities
Current Liabilities
Accounts Payable and Accrued Expenses	$	2,390		$	2,390
Total Current Liabilities		2,390			2,390
Total Liabilities		2,390			2,390
Stockholders’ Equity (Deficit)
Preferred Stock, $0.001 par value,10,000,000 shares authorized, none issued and outstanding		-			-
Common Stock, $0.001 par value; 40,000,000 shares authorized, 28,666,667 shares issued and outstanding as at March 31, 2012, and at December 31, 2012		28,667			23,667
Additional Paid-in Capital		975,459			930,459
Accumulated Deficit		(963,853	)		(907,718	)
Accumulated other comprehensive income (loss)		(35,872	)		(23,372	)
Total Stockholders’ Equity (Deficit)		4,401			23,036
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)	$	6,791		$	25,426

The accompanying notes are an integral part of these condensed financial statements.

The accompanying notes are an integral part of these financial statements.

F-1

MORRIS BUSINESS DEVELOPMENT COMPANY

(A Development Stage Company)

Statement of Operations

For the Three and Nine Month Periods Ended December 31, 2012, 2011 and 2010

(Unaudited)

	For the Three Month Period Ended									For the Nine Month Period Ended
							For the period
	December 31,									December 31,
							from Inception
	2012			2011			2010			2012			2011			2010
	For the three months ended						(April 1, 2012)
Net Revenue	$	5,250		$	-		$	3,800		$	8,250		$	-		$	10,090
	June 30, 2013						through
Cost of Revenue		-			-			-			-			-			-
	2013			2012			June 30, 2013
Gross Profit		5,250			-			3,800			8,250			-			10,090
Revenue
Operating Expenses:
Consulting		3,000			-			18,250
Professional Fees		1,281			1,268			1,300			6,399			7,987			6,981
Total Revenue		3,000			-			18,250
Consulting					1,950			3,495			5,550			2,650			8,345
Cost of Sales		-			-			-
Salaries and related expenses								-						-			-
Gross Profit		3,000			-			18,250
Other		272			472			90			52,436			1,366			1,511
General and Administrative Expenses
Total Operating Expenses		1,553			3,690			4,885			64,385			12,003			16,837
Professional Fees		2,850			462			14,296
Loss from operations		3,697			(3,690	)		(1,085	)		(56,135	)		(12,003	)		(6,747	)
Consulting		-			-			7,550
Non-operating income (expense)
Other general and administrative expenses		323			1,473			4,577
Interest expense		-			(627	)		-			-			(1,883	)		(4,772	)
Total General and Administrative Expenses		3,173			1,935			26,423
Total other expense		-			(627	)		-			-			(1,883	)		(4,772	)
Interest expense		-			-			-
Loss before income taxes		3,697			(4,317	)		(1,085	)		(56,135	)		(13,886	)		(11,519	)
Net loss before other comprehensive loss		(173	)		(1,935	)		(8,173	)
Provision for income taxes		-			-			-			-			-			-
Other comprehensive loss - investment securities		-			(6,250	)		(12,500	)
Net Loss		3,697			(4,317	)		(1,085	)		(56,135	)		(13,886	)		(11,519	)
Comprehensive Loss		(173	)		(8,185	)		(20,673	)
Other comprehensive loss
Net loss per common share - basic and diluted	$	(0.00	)	$	(0.00	)
Unrealized loss on marketable securities		(6,250	)		-			-			(12,500	)		-			-
Weighted average number of shares outstanding - basic and diluted		28,667,000			23,667,000
Comprehensive Gain (Loss)		(2,553	)		(4,317	)		(1,085	)		(68,635	)		(13,886	)		(11,519	)
Basic and diluted net loss per common share:	$	0.00		$	(0.00	)	$	(0.00	)	$	-		$	(0.00	)	$	(0.00	)
Basic and diluted weighted average number of common shares outstanding:		28,666,667			23,666,667			23,666,667			28,666,667			23,666,667			16,555,556

The accompanying notes are an integral part of these condensed financial statements.

F-2

MORRIS BUSINESS DEVELOPMENT COMPANY

~~Statement~~(A ~~of Stockholders’ Equity~~Development ~~(Deficit~~Stage Company)

~~For~~Statement ~~the~~of ~~period~~Cash ~~April 1, 2006 to December 31, 2011~~Flows

(Unaudited)

													Accumulated
							For the period
													Other
							from Inception
	Common Stock						Additional			Accum-			Compre-			Total
	For the three months ended						(April 1, 2012)
	Number of						Paid-In			ulated			hensive			Stockholders’
	June 30, 2013						through
	Shares			Amount			Capital			Deficit			Income (Loss)			Deficit
	2013			2012			June 30, 2013
Beginning balance as of April 1, 2006		13,000,000		$	13,000		$	55,600		$	(269,490	)				$	(200,890	)
OPERATING ACTIVITIES
Net loss for the year											(49,444	)					(49,444	)
Net loss	$	(173	)	$	(1,935	)	$	(8,173	)
Balances, March 31, 2007		13,000,000		$	13,000		$	55,600		$	(318,934	)				$	(250,334	)
Change in operating assets and liabilities:
Capital contribution								2,667									2,667
Accounts receivable		(1,000	)		3,000			3,500
Unrealized gain on market security														16,250			16,250
Accounts payable		150			-			1,930
Net loss for the year											(37,272	)					(37,272	)
Net cash provided by (used by) operating activities		(1,023	)		1,065			(2,743	)
Balances, March 31, 2008		13,000,000		$	13,000		$	58,267		$	(356,206	)	$	16,250		$	(268,689	)
FINANCING ACTIVITIES
Capital contribution								3,999									3,999
Repayment of Loans from Officers		-			(2,000	)		-
Beneficial conversion								415,000									415,000
Net cash used by financing activities		-			(2,000	)		-
Unrealized loss on market security														(25,000	)		(25,000	)
NET DECREASE IN CASH		(1,023	)		(935	)		(2,743	)
Net loss for the year											(480,347	)					(480,347	)
CASH, BEGINNING OF PERIOD		3,706			5,426			5,426
Balances, March 31, 2009		13,000,000		$	13,000		$	477,266		$	(836,553	)	$	(8,750	)	$	(355,037	)
CASH, END OF PERIOD	$	2,683		$	4,491		$	2,683
Net loss for the year											(47,750	)					(47,750	)
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Balances, March 31, 2010		13,000,000		$	13,000		$	477,266		$	(884,303	)	$	(8,750	)	$	(402,787	)
Cash paid for
10,666,667 shares issued to pay debt Sep. 30, 2010		10,666,667			10,667			309,333									320,000
Interest	$	-		$	-
Contribution of assumption of liability by officer March. 31, 2011								57,109									57,109
Taxes	$	-		$	-
Net loss for the year											(16,115	)		(14,622	)		(30,737	)
Balances, March. 31, 2011		23,666,667		$	23,667		$	843,708		$	(900,418	)	$	(23,372	)	$	(56,415	)
Contribution of note payable extenguished March 31, 2012								50,968									50,968
Contribution of cancellation of liabilities by officer March 31, 2012								35,783									35,783
Net loss for the year											(7,300	)					(7,300	)
Balances, March 31, 2012		23,666,667		$	23,667		$	930,459		$	(907,718	)	$	(23,372	)	$	23,036
Issued 5,000,000 shares common stock at $0.01 for debt-note				$	5,000		$	45,000								$	50,000
Net loss for the period											(56,135	)		(12,500	)		(68,635	)
Balances, December 31,2012		28,666,667		$	28,667		$	975,459		$	(963,853	)	$	(35,872	)	$	4,401

The accompanying notes are an integral part of these condensed financial statements.

F-3

MORRIS BUSINESS DEVELOPMENT COMPANY

~~Statement~~(A ofDevelopment ~~Cash~~Stage ~~Flows~~Company)

~~for~~NOTES ~~the~~TO ~~nine~~CONDENSED ~~months~~FINANCIAL ~~ended December 31, 2012, 2011, and 2010~~STATEMENTS

~~(Unaudited)~~UNAUDITED

	2012			2011			2010
Cash flows from operating activities:
Comprehensive Net Loss	$	(68,635	)	$	(13,886	)	$	(11,519	)
Adjustments to reconcile net loss to net cash used by operating activities:
Unrealized loss on marketable security		12,500
Non cash issue of stock for services		50,000
Change in operating assets and liabilities:
Accounts receivable		4,500
Accounts payable					10,206			(19,157	)
Net cash provided by (used by) operating activities		(1,635	)		(3,680	)		(30,676	)
Cash flows from financing activities:
Loans from Officers					2,883			33,725
Receivables from related party								1,826
Net cash provided by financing activities		-			2,883			35,551
Net increase (decrease) in cash		(1,635	)		(797	)		4,875
Cash, beginning of the period		5,426			1,415			-
Cash, end of the period	$	3,791		$	618		$	4,875
Supplemental cash flow disclosure:
Interest paid during the year	$	-		$	-		$	-
Taxes paid during the year	$	-		$	-		$	-

June 30, 2013

~~The~~NOTE ~~accompanying~~1 BASIS ~~notes~~OF ~~are~~PRESENTATION anAND ~~integral part of these financial statements.~~ORGANIZATION

Basis of Presentation

These interim condensed financial statements as of and for the three months ended June 30, 2013 reflect all adjustments which, in the opinion of management, are necessary to fairly state the Company’s financial position and the results of its operations for the periods presented in accordance with the accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature.

These interim condensed financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s fiscal year end March 31, 2013 report on Form 10-K. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the three month period ended June 30, 2013 are not necessarily indicative of results for the entire year ending March 31, 2014.

Organization

On April 1, 1998, Morris Business Development Company (the Company or MBDC) was incorporated in California as Electronic Media Central Corporation (EMC) (formerly a division of Internet Infinity, Inc. (III)). The Company is engaged in providing services for the development and growth of both American public and private stock companies. The Company’s year end is March 31.

As of May 12, 2006, the Company filed Form N-54A with the United States Securities Exchange Commission to become a business development company by certifying that it is a closed-end company (mutual fund) organized and operated for the purpose of making investments in securities described in Section 55 (a)(1) through (3) of the Investment Company Act of 1940 (the Act); and that it will make available significant managerial assistance to American companies with respect to issuers of such securities to the extent required by the Act.

On March 29, 2007 the Company registered a name change to Morris Business Development Company with the California Secretary of State.

The Company has commenced the development of new management consulting services to assist American client companies in complying with the reporting requirements to the government and in communicating with shareholders, customers and the public and the accessing of needed growth capital. The Company received 2.5 million shares from its first client for financial consulting work completed in the fiscal year ended March 31, 2008.

In June 2009, the Company entered into an agreement with Howell Capital Holdings, LLC operating as “More American Jobs” to help American companies prepare to access both government and private financial support. In addition, the Company also commenced a new participation relationship in 2009 with Avalon Funding Corporation, an asset based lender focusing on accounts receivable and purchase order funding.

F-4

MORRIS BUSINESS DEVELOPMENT COMPANY

~~NOTES TO~~(A ~~AUDITED~~Development ~~FINANCIAL~~Stage ~~STATEMENTS~~Company)

~~MARCH 31,~~NOTES ~~2012~~TO CONDENSED FINANCIAL STATEMENTS

~~NOTE 1 ORGANIZATION~~UNAUDITED

~~On April 1,~~June ~~1998~~30, Morris Business Development Company (the Company or MBDC) was incorporated in California as Electronic Media Central Corporation (EMC) (formerly a division of Internet Infinity, Inc. (III)). The Company is engaged in providing services for the development and growth of both American public and private stock companies. The Company is also engaged in providing services for duplication, replication and packaging of DVDs and CDs.2013

As of May 12, 2006 the Company filed Form N-54A with the United States Securities Exchange Commission to become a business development company by certifying that it is a closed-end company (mutual fund) organized and operated for the purpose of making investments in securities described in Section 55 (a)(1) through (3) of the Investment Company Act of 1940; and that it will make available significant managerial assistance to American companies with respect to issuers of such securities to the extent required by the act.

On March 29, 2007 the Company registered a name change to Morris Business Development Company with the California Secretary of State.

The Company has commenced the development of new management consulting services to assist American client companies are in complying with the reporting requirements to the government and in communicating with shareholders, customers and the public and the accessing of needed growth capital. The Company has received 2.5 million shares from its first client for financial consulting work completed in the fiscal year ended March 31, 2008.

In June, 2009 the Company entered into an agreement with Howell Capital Holdings, LLC operating as “More American Jobs” to help American companies prepare to access both government and private financial support. In addition, the Company will also commence a new participation relationship this month with Avalon Funding Corporation, an asset based lender focusing on accounts receivable and purchase order funding.

On April 7, 2010 the Company entered into a Material Definitive Agreement with Video Army, LLC, A California limited partnership, to operate a (‘NEWCO”) business named “Internet Video / Morris BDC, LLC”, a California Limited Partnership and/or other registered DBAs. The business will provide financial and internet related services primarily for both private and thinly traded public stock American based companies.

~~NOTE~~Beginning 2April ~~SUMMARIES~~1, OF2012, ~~SIGNIFICANT~~the ~~ACCOUNTING~~Company ~~POLICIES~~became classified &as ~~REALIZATION~~a OFdevelopment ~~ASSETS~~stage company.

NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Development Stage Activities

The Company complies with Financial Accounting Standards Codification (“ASC’) 915 and Securities and Exchange Commission Act Guide 7 for its characterization of the company as a development stage enterprise.

Cash and cash equivalents

The Company considers all liquid investments with aan original maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents.

~~F-5~~Use of Estimates

Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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 of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Long-lived ~~assets~~ Assets

The Company periodically analyzes long-lived assets for potential impairment, assessing the appropriateness of lives and recoverability of unamortized balances through measurement of undiscounted ~~operation~~operating cash flows in accordance with Financial Accounting Standards Board ASC (Accounting Standards Codification) No. 144, Property, Plant and Equipment. If impairment is deemed to exist, it will be written down to its fair value. Fair value ~~Value~~ is generally determined using a discounted cash flow analysis. ~~As at March 31, 2012, the Company does not believe any adjustment for impairment is required.~~

Income ~~taxes~~ Taxes

~~ASC (Accounting~~The ~~Standards~~Company ~~Codification)~~utilizes ~~No.~~FASB ASC 740, “Income Taxes.” ~~Deferred~~which requires the recognition of deferred tax assets and liabilities ~~are recognized~~ for the expected future tax consequences ~~attributable~~of events tothat ~~temporary~~have ~~differences~~been ~~between~~included in the financial statements ~~carrying~~or ~~amounts~~tax ofreturns. ~~existing~~Under ~~assets~~this ~~and liabilities~~method, ~~and~~deferred ~~loss carry-forwards and their respective~~ tax ~~bases. Deferred tax~~ assets and liabilities are ~~measured~~determined ~~using~~based ~~enacted tax~~on ~~rates~~the ~~expected~~difference tobetween ~~apply to taxable income in~~ the ~~years~~tax inbasis ~~which~~of ~~those~~assets ~~temporary~~and ~~differences~~liabilities ~~are~~and ~~expected~~their tofinancial bereporting ~~recovered~~amounts orbased ~~settled.~~on ~~The~~enacted ~~effect~~tax oflaws aand ~~change~~statutory in tax ~~rules~~rates onapplicable ~~deferred~~to ~~tax~~the ~~assets~~periods ~~and~~in ~~liabilities~~which isthe ~~recognized~~differences inare ~~operations~~expected into ~~the~~affect ~~year~~taxable ~~of change~~income. Valuation Aallowances ~~valuation~~are ~~allowance~~established isif ~~recorded when~~ it is “more likely- than- not” that asome portion or all of the deferred tax asset will not be be realized.

~~Stock~~F-~~based compensation~~5

~~The Company~~MORRIS ~~complies~~BUSINESS ~~with~~DEVELOPMENT FASB ASC 718 Compensation – Stock Compensation, requiring companies to measure and recognize the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value.COMPANY

~~Fair value~~(A ofDevelopment ~~financial~~Stage ~~instruments~~Company)

~~The Financial~~NOTES ~~Accounting~~TO ~~Standards~~CONDENSED ~~Board~~FINANCIAL issued ASC (Accounting Standards Codification) 820-10 (SFAS No. 157), “Fair Value Measurements and Disclosures” for financial assets and liabilities. FASB ASC 820-10 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. FASB ASC 820-10 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. FASB ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required by the standard that the Company uses to measure fair value:STATEMENTS

~~- Level 1: Quoted prices in active markets for identical assets or liabilities.~~UNAUDITED

~~F-6~~June 30, 2013

-Fair ~~Level~~Value 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of ~~the~~Financial ~~related assets or liabilities.~~instruments

The Financial Accounting Standards Board issued ASC (Accounting Standards Codification) 820-10, ~~Level~~“Fair 3:Value ~~Unobservable~~Measurements ~~inputs~~and ~~that~~Disclosures” ~~are~~for ~~supported~~financial byassets ~~little~~and orliabilities. FASB noASC ~~market~~820-10 ~~activity~~provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. FASB ASC 820-10 defines fair value as the price that ~~are~~would ~~significant~~be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. FASB ASC 820-10 also establishes a fair value ofhierarchy which requires an entity to maximize the ~~assets~~use orof ~~liabilities~~observable inputs, where available. The following summarizes the three levels of inputs required by the standard that the Company uses to measure fair value:

~~The carrying~~● ~~amounts~~Level of1: ~~the~~Quoted ~~Company’s~~prices ~~financial~~in ~~assets~~active asmarkets atfor ~~March~~identical ~~31,~~assets ~~2012~~or ~~were measured against the three levels of inputs required by the standard to measure fair value:~~liabilities.

	Level 1		Level 2		Level 3
	Quoted		Observable		Unobservable
	Prices		Inputs		Inputs		Total
Marketable Securities	$	12,000
	$	12,000	$	-	$	-	$	$12,000

●

Level 2: Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

●

Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

All of the Company’s financial instruments are recorded at fair value due TO their term of maturity.

Revenue Recognition

The Company’s believes its revenue recognition policies are in compliance with Staff ~~accounting~~Accounting ~~bulletin~~Bulletin (SAB) 104. Sales revenue is recognized at the date of ~~shipment~~delivery to customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and ~~collectibles~~collection is reasonably assured. The Company recognizes consulting fee revenue when the transaction is complete and the fee has been earned.

Advertising and Marketing Costs

The Company expenses costs of advertising and marketing as incurred. Advertising and marketing expense for the years ended March 2012 and 2011 and 2010 were insignificant.

Basic and Diluted Earnings Per Share

Earnings per share are calculated in accordance with FASB ASC Topic 260, “Earnings per share”. Net loss per share for all periods presented has been restated to reflect the adoption of SFAS No. 128. Basic net loss per share is based upon the weighted average number of common shares outstanding. Diluted net loss per share is based on the assumption that all dilutive convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period.

F-7

Recent Accounting Pronouncements

In December 2011, the FASB issued ASU No. 2011-11, “Disclosures about Offsetting Assets and Liabilities.” The amendments in this update require enhanced disclosures around financial instruments and derivative instruments that are either (1) offset in accordance with either ASC 210-20-45 or ASC 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in accordance with either ASC 210-20-45 or ASC 815-10-45. An entity should provide the disclosures required by those amendments retrospectively for all comparative periods presented. The amendments are effective during interim and annual periods beginning on or after January 1, 2013. The Company does not expect this guidance to have any impact on its consolidated financial position, results of operations or cash flows.

ASU 2011-08, Intangibles – Goodwill and Other (Topic 350): Testing Goodwill for Impairment is applicable to fiscal years beginning after December 15, 2011. Early application is permitted. The Company does not expect this ASU has a material impact on its financial position or carrying value of its intangible assets at this time.

The Company has reviewed issued accounting pronouncements and plans to adopt those that are applicable to it. The Company does not expect the adoption of any other pronouncements to have an impact on its results of operations or financial position.

Accounts Receivable

~~The~~Accounts receivable are presented at net realizable value consisting of the carrying amount less an allowance for uncollectible accounts, as needed. The Company maintains ~~reserves~~an allowance for ~~potential~~doubtful ~~credit~~accounts for estimated losses. onThe Company reviews the accounts receivable. ~~Management~~on ~~reviews~~a periodic basis and uses the ~~composition~~allowance method ofto account for uncollectible accounts receivable ~~and~~balances. ~~analyzes~~Under ~~historical~~the ~~bad~~allowance ~~debts~~method, ~~customer~~if ~~concentrations~~needed, an estimate of uncollectible customer balances is made based upon specific account balances that are considered uncollectible. Factors used to establish an allowance include the age of the balance, credit ~~worthiness~~quality, payment history, current ~~economic~~credit-worthiness ~~trends~~of the customer and current ~~changes~~economic intrends. ~~customer~~There ~~payment~~is ~~patterns~~no toallowance ~~evaluate~~for doubtful accounts recorded as of June 30, 2013 as the ~~adequacy~~balance of ~~these~~the ~~reserves.~~Company’s receivables ~~Reserves~~was ~~are~~considered ~~recorded~~collectible ~~primarily~~based on aanalysis ~~specific identification~~of ~~basis~~individual accounts.

~~Marketable Securities~~Basic and Diluted Earnings Per Share

~~The Company’s~~Earnings ~~investments~~(loss) inper ~~securities~~share are ~~classified~~calculated asin accordance ~~available-for-sale~~with ~~and,~~FASB asASC ~~such~~Topic 260, ~~are~~“Earnings ~~carried~~(loss) atper ~~fair~~Share.” ~~value~~Basic net loss per share is based upon the weighted average number of common shares outstanding. Diluted net loss per share is based on the assumption that all dilutive convertible ~~quoted~~shares ~~market~~and ~~prices~~stock options were converted or exercised. ~~Securities~~Dilution ~~classified~~is ascomputed ~~available-for-sale~~by ~~may~~applying bethe ~~sold~~treasury instock ~~response~~method. Under this method, options and warrants are assumed to ~~changes~~be inexercised ~~interest~~at ~~rates~~the beginning of the period (or at the time of issuance, ~~liquidity needs~~if later), and ~~for~~as if ~~other~~funds ~~purposes~~obtained thereby were used to purchase common stock at the average market price during the period.

~~Unrealized holding gains and losses for available~~F-for-sale securities are excluded from earnings and reported as a separate component of stockholder’s equity. Realized and unrealized gains and losses for securities classified as available-for-sale are included in the statement of operations and comprehensive Gain, respectively. On March 31, 2012 and 2011, marketable securities have been recorded at $12,500 and $12,500 respectively, based upon the fair market value of the marketable securities.6

Equity Securities Name and Symbol

Number of Shares Held

Cost

Market Value

Accumulated Unrealized Loss

Traded on Pink Sheets (PK) or Bulletin Board (BB)

Leep, Inc (LPPI)

2,500,000

21,250

6,250

(15,000

)

LPPI

MORRIS BUSINESS DEVELOPMENT COMPANY

~~F-8~~(A Development Stage Company)

NOTES TO CONDENSED FINANCIAL STATEMENTS

UNAUDITED

June 30, 2013

Recent Accounting Pronouncements Adopted

There are no recently issued accounting pronouncements that the Company has yet to adopt that are expected to have a material effect on its financial position, results of operations, or cash flows.

Reclassification of Prior Year Amounts

Certain prior year amounts were reclassified to conform with the current year presentation.

NOTE 3 UNCERTAINTY OF ABILITY TO CONTINUE AS A GOING CONCERN

The Company’s condensed financial statements are prepared using ~~the~~ generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has not generated a sustainable source of income and has an accumulated deficit of $~~907~~924,~~718~~391 at ~~March~~June 3130, ~~2012~~2013.

In view of the ~~matters~~matter described above, recoverability of a major portion of the recorded asset amounts shown in the accompanying balance sheets is dependent upon continued operations of the Company, which in turn is dependent upon the Company’s ability to raise additional capital, obtain financing and to succeed in its future operations. The condensed financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Management has taken the following steps to revise its operating and financial requirements, which it believes are sufficient to provide the Company with the ability to continue as a going concern. The Company is actively pursuing ~~the~~ new business development company ~~activities~~ initiatives and additional funding from strategic partners, which would enhance stockholders’ investment. Management believes that the above actions will allow the Company to continue operations through ~~the~~this ~~next~~ fiscal year. However, there is no assurance the Company will be successful in this regard.

NOTE 4 STOCKHOLDERS’ ~~CAPITAL~~EQUITY

~~On September~~There ~~30, 2010, 10,667,000 shares of common stock~~ were ~~issued~~no atequity ~~$0.03~~transactions ~~per share~~ in ~~retirement~~the ofthree months ~~debt~~ending ofJune ~~$320~~30,~~000~~ 2013.

On As of June 30, 2013 and March 31, ~~2010~~2013 the Company had authorized 10,000,000 anshares ~~officer~~of preferred stock, of ~~the~~which ~~Company~~none ~~contributed~~is ~~$57~~issued and outstanding and had authorized 40,~~109~~000,000 shares ~~upon~~of ~~assumption~~common stock of par value $570.001,~~109~~ ~~liabilities~~ of ~~the~~which ~~Company~~28,667,000 were issued and outstanding.

~~On March 31, 2012 a note payable of $41,847 together with accrued interest of $9,121 was cancelled and recorded as capital contributed to the company.~~F-7

~~On March~~ITEM ~~31,~~2. ~~2012~~Management’s aDiscussion ~~Note~~and ~~payable~~Analysis ~~to an Officer~~ of ~~the~~Financial ~~Company~~Condition ~~of $41,847~~ and aResults ~~payable to the officer~~ of ~~$190 together with accrued interest of $19,452 was cancelled and recorded as capital contributed to the Company.~~Operations

~~As of~~Disclaimer ~~March~~Regarding ~~31,~~Forward ~~2012 and 2011 the Company had authorized 10,000,000 preferred shares of par value~~Looking Statements

$0Our Management’s Discussion and Analysis contains not only statements that are historical facts, but also statements that are forward-looking (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934).~~001~~ Forward-looking statements are, by their very nature, uncertain and risky. These risks and uncertainties include international, national and local general economic and market conditions; demographic changes; our ability to sustain, manage, or forecast growth; our ability to successfully make and integrate acquisitions; raw material costs and availability; new product development and introduction; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; the loss of ~~which~~significant ~~none~~customers ~~was~~or ~~issued~~suppliers; fluctuations and ~~outstanding~~difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; and other risks that might be detailed from time to time in our filings with the Securities and Exchange Commission.

AsAlthough the forward-looking statements in this Quarterly Report reflect the good faith judgment of ~~March~~our 31management, ~~2012~~such statements can only be based on facts and ~~2011~~factors ~~the~~currently ~~Company~~known ~~had~~by ~~authorized~~them. 40Consequently,~~000~~ and because forward-looking statements are inherently subject to risks and uncertainties,~~000~~ the ~~shares~~actual ofresults ~~common~~and ~~stock~~outcomes ofmay ~~par~~differ ~~value~~materially $0from the results and outcomes discussed in the forward-looking statements.~~001,~~ You ofare ~~which~~urged to carefully review and consider the various disclosures made by us in this report and in our other reports as we 28attempt to advise interested parties of the risks and factors that may affect our business,~~667~~ financial condition,~~000~~ ~~were~~and ~~issued~~results of operations and ~~outstanding~~prospects.

~~NOTE~~General ~~5 RELATED PARTY TRANSACTIONS~~Overview

~~George Morris~~We isfocus on the development ~~chairman~~ of ~~MBDE.~~opportunities Asto ofinvest ~~March~~in ~~31,~~eligible ~~2011,~~portfolio ~~Mr.~~companies ~~Morris’~~by ~~beneficial~~providing ~~ownership~~either ~~percentages~~early ofstage ~~related~~capital ~~companies’~~and/or “fix-it” ~~common~~capital ~~stock~~for isexisting asprivate ~~follows:~~or thinly traded public companies along with strategic guidance and operational support.

Morris Business Development Company (the Company)	92.23	%
Internet Infinity, Inc.	85.1	%
Morris & Associates, Inc.	71.30	%
Apple Realty, Inc.	100.00	%

Our principal objective is both current consulting income and long-term capital appreciation. We may invest in debt securities of these companies, or may acquire an equity interest in the form of common or preferred stock, warrants or options to acquire stock or the right to convert the debt securities into stock. We may invest alone, or as part of a larger investment group. Consistent with our status as a BDC and the purposes of the regulatory framework for BDC’s under the 1940 Act, we will provide managerial assistance, potentially in the form of a consulting agreement or in the form of a board of director’s seat, to the developing companies in which we invest.

FIn addition, we may acquire either a minority or controlling interest in companies in a roll-9up strategy. It is anticipated that any acquisitions will be primarily in exchange for our common stock, or a combination of cash and stock. The principal objective of acquisitions pursuant to a roll-up strategy would be to consolidate an industry and either sell the acquired entities as a larger unit, or take the unit public through an initial public offering, spin-off to our shareholders, or reverse merger into a publicly traded shell corporation.

~~The~~We shall currently ~~Company’s~~operate ~~note~~as ~~payable~~an internally managed investment company until such time as we are ready to ~~Apple~~select ~~Realty,~~either ~~Inc.~~an ofindependent ~~$41,847~~or ~~was~~affiliated external ~~extinguished~~management ~~during~~company ~~the~~discussed ~~year~~below. Our operations may be governed by ~~its~~an ~~cancellation,~~Investment ~~together~~Advisory ~~with~~Management Agreement to be ~~accrued~~entered ~~interest~~into ofbetween ~~$9,121.~~us ~~The~~and ~~note~~a ~~was~~new ~~due~~investment onadvisory ~~demand,~~limited liability company which may be and ~~was~~probably ~~secured~~will be formed and wholly-owned by ~~assets~~our ofChairman, ~~the~~George ~~Company~~Morris. ~~Interest~~We ~~accrued~~have atnot 6%elected ~~per~~to ~~annum~~but plan to attempt to qualify without a guarantee of success or timing, to be taxed as a regulated investment company as defined under Subchapter M of the Internal Revenue Code.

~~The Company’s payables to the Company’s chairman of $15,005 and $190 were extinguished during the year by his cancellation of the debt, together with accrued interest of 20,588.~~4

~~NOTE~~Our 6common ~~CONCENTRATION~~stock trades OFon ~~CREDIT~~the ~~RISK~~Over the Counter Bulletin Board under the symbol “MBDE.”

For the year ended March 31, 2012, 2011 and 2010, revenue from the top two customers represents (None), 100% and 100% of the Company’s total revenue, respectively. Accounts receivable balance outstanding from these customers was zero as of March 31, 2012, 2011 and 2010. For total purchases for the twelve month periods ended March 31, 2012, 2011 and 2010 the Company had two top vendors who represent (None), 100%and 100%of the Company’s total purchases. Accounts payable balance outstanding for these vendors was zero, zero and $526 as of March 31, 2012, 2011 and 2010, respectively.BUSINESS

~~NOTE 7 INCOME TAXES~~General

NoMorris Business ~~provision~~Development ~~was~~Company, ~~made~~a ~~for~~California ~~federal~~corporation ~~income~~(referred ~~tax~~to ~~for~~as “we,” “us,” “our” or the ~~years~~“Company”) was ~~ended~~incorporated on March 3110, ~~2012~~1998, ~~2011~~in ~~and~~the ~~2010,~~State ~~since~~of ~~the~~California, ~~Company~~as ~~had~~Electronic aMedia ~~significant net~~Central ~~operating loss~~Corporation. ~~The~~Prior ~~net~~to ~~operating~~our ~~loss~~incorporation, we ~~carry-forwards~~commenced ~~may~~sales bedistribution ~~used~~operations toin ~~reduce~~late ~~taxable~~1996 ~~income~~as ~~through~~a ~~the~~division ~~year~~of ~~2027~~Internet Infinity, Inc. ~~The~~(“Internet ~~availability~~Infinity”). ofFollowing ~~the~~our ~~Company’s~~incorporation, ~~net~~in ~~operating~~April ~~loss~~1998, ~~carry-forwards~~we ~~are~~continued ~~subject~~ to ~~limitation~~provide ifsuch ~~there~~services isas a 50100% orwholly ~~more~~owned ~~positive~~subsidiary ~~change in the ownership~~ of ~~the Company’s stock~~Internet Infinity. ~~The~~Internet ~~provision~~Infinity ~~for~~supplied ~~income~~us ~~taxes~~with ~~consists~~management ofsupport ~~the~~to ~~state~~launch ~~minimum~~our ~~tax~~Internet ~~imposed~~sales ondistribution ~~corporations~~activities.

~~The~~On September 28, ~~net~~2001, ~~operating~~all ~~loss~~500,000 ~~carryforward~~of ~~for~~our ~~federal~~issued and ~~state~~outstanding ~~income~~shares ~~tax~~of ~~purposes~~common ~~was~~stock, ~~approximately~~held ~~$907~~by Internet Infinity,~~000~~ were distributed to the Internet Infinity shareholders of record as of ~~March~~September 3118, ~~2012~~2001.

~~The~~Our initial business ~~components~~focus in late 1996 was on distributing electronic media duplication and packaging services. These services were supplied through March 31, 2002. On May 12, 2006, we filed an election to be treated as a business development company (“BDC”) under the Investment Company Act of 1940 (the ~~net~~“1940 ~~deferred~~Act”), ~~tax~~which ~~asset~~became ~~are~~effective ~~summarized~~on ~~below:~~the date of filing.

	2012			2011			2010
Deferred tax asset – from net operating loss	$	363,087		$	360,167			$ 350, 641
Less valuation allowance		(363,087	)		(360,167	)		350,641	)
Net deferred tax asset	$	-		$	-		$	-

On March 30, 2007, we changed our name to Morris Business Development Company with the intent of operating as a BDC.

~~The~~As of March 31, ~~Company~~2013 ~~has~~George ~~recorded~~Morris, aPh.D. ~~100%~~returned ~~valuation~~to ~~allowance~~operations ~~for~~as the ~~deferred~~CEO ~~tax~~of ~~asset~~the ~~since~~Company itwith isthe ~~more~~full ~~likely~~motivation ~~than~~to ~~not~~build ~~that~~the ~~some~~mission orof ~~all~~the Company. Dr. Morris and the new independent Board of Directors plan to seek revenue and profits for the ~~deferred~~Company ~~tax~~through ~~asset~~strategic partnering ~~will~~and ~~not~~acquisitions beas ~~realized~~a Business Development Company (“BDC”).

~~The valuation~~Description ~~allowance~~of ~~increased in 2012 by $2,920 and in 2011 by $12,295 due to the increase in net operating losses in these years.~~Business

~~F-10~~General

~~The~~Most Business Development ~~following~~Companies is(“BDC”) athat ~~reconciliation~~comply ofwith the ~~provision~~1940 ~~for~~Investment ~~income~~Act ~~taxes~~are atsimilar in their business and investment operations due to the Ustandard compliance requirements.S However, there are significant differences between individual BDC philosophies and investment strategies. ~~federal~~Therefore, ~~income~~only ~~tax~~careful ~~rate~~reading toof ~~the~~our ~~income~~BDCs ~~taxes~~SEC ~~reflected~~filings and other reports can point out our differences infor the ~~Statement~~benefit of ~~Operations:~~the reader.

	2012			2011			2010
Tax expense (credit) at statutory rate-federal		(34	)%		(34	)%		(34	)%
State tax expense net of federal tax		(6	)		(6	)		(6	)
Changes in valuation allowance		40			40			40
Tax expense at actual rate		-			-			-

Currently, we are an internally managed, non-diversified, closed-end management Investment Company that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended (the “1940 Act”). We generally have to invest at least 70% of our total assets in “qualifying assets,” including securities of American companies, cash, cash equivalents, U.S.A. government securities and high-quality debt investments. See “Regulation as a Business Development Company” below.

~~Income tax expense consisted of the following:~~ 5

	2012		2011		2010
Current tax expense:
Federal	$	-		-		-
State		800		800		800
Total current	$	800	$	800	$	800
Tax expense	$	800	$	800	$	800

We plan to elect to be treated for tax purposes as a regulated investment company, or a RIC, under Subchapter M of the Code. However, there is no guarantee that we will be successful in obtaining or maintaining our RIC status. As a new BDC operation, we have not yet generated a taxable profit.

~~NOTE~~As 8a ~~SUBSEQUENT~~Fund, ~~EVENTS~~we focus our investments in companies that currently show net income from their operations or will show a net income from their operations in less than one year with our management and capital support.

~~Events subsequent~~However, towe ~~March~~are a ~~15,~~fund ~~2012~~pursuing ~~have~~both ~~been~~investor ~~evaluated~~income ~~through~~generation ~~June~~and ~~29,~~investor ~~2012,~~capital ~~the~~appreciation ~~date~~models. ~~these~~Therefore, ~~statements~~we ~~were~~realize ~~available~~that toan ~~be issued,~~investment toopportunity ~~determine~~with ~~whether~~future ~~they~~pay-off ~~should~~results bemay ~~disclosed~~require toadditional ~~keep~~risk ~~the~~for ~~financial~~an ~~statements~~investment ~~from~~in ~~being~~a ~~misleading.~~portfolio ~~Management~~company ~~found~~that nois ~~subsequent~~not currently ~~events~~profitable toor bepositively ~~disclosed~~cash flowing.

~~F-11~~Following are the two general investment models currently guiding our investment decision process. However, these descriptions may be substantially modified in the future to pursue financial gains for our BDC.

~~ITEM~~Model 1 is not mutually exclusive to Model 2. ~~Management’s~~and ~~Discussion~~our BDC may actively pursue both Model 1 and ~~Analysis~~2 ofsimultaneously ~~Financial~~with ~~Condition~~both the same and/or ~~Results~~different ofportfolio ~~Operations~~companies.

~~Disclaimer Regarding~~MODEL ~~Forward~~1. ~~Looking~~INCOME ~~Statements~~GENERATION

~~Our Management’s~~Income ~~Discussion and Analysis contains not only statements that are historical facts, but also statements that are~~generation ~~forward-looking~~is ~~(within~~sought ~~the~~from ~~meaning~~facilitating ofshort ~~Section~~term ~~27A~~secured ofloans ~~the~~to ~~Securities~~our ~~Act~~portfolio ofcompanies ~~1933~~ and ~~Section~~other ~~21E~~non-portfolio ofcompanies, ~~the~~through ~~Securities Exchange Act~~affiliated ofand ~~1934). Forward~~non-~~looking~~affiliated ~~statements~~lending ~~are,~~sources. byOperating ~~their~~capital ~~very~~loans ~~nature,~~may ~~uncertain~~be ~~and~~used ~~risky.~~by ~~These~~our ~~risks~~investment ~~and~~portfolio ~~uncertainties~~companies ~~include~~for ~~international~~invoices, ~~national~~ orders and ~~local~~inventory ~~general economic~~ and ~~market~~may ~~conditions;~~follow ~~demographic~~the ~~changes;~~factoring ~~our~~strategy ~~ability~~operated tofor ~~sustain, manage, or forecast growth;~~ our ~~ability~~BDC toby ~~successfully~~affiliated ~~make~~ and ~~integrate~~non-affiliated ~~acquisitions;~~experienced ~~raw material costs and availability; new product development and~~factors. ~~introduction;~~These ~~existing~~are ~~government~~factors ~~regulations and changes in, or the failure to comply~~ with, ~~government~~existing ~~regulations;~~software ~~adverse publicity; competition; the loss of significant customers or suppliers; fluctuations~~ and ~~difficulty~~management insystems ~~forecasting operating results; changes~~ in ~~business~~place. ~~strategy~~Our orBDC ~~development~~investors ~~plans;~~may ~~business~~participate ~~disruptions;~~in the ~~ability~~cash ~~to attract and retain qualified personnel; the ability~~return toyield ~~protect~~generated ~~technology;~~by ~~and~~these ~~other risks that might be detailed from time to time in our filings with the Securities and Exchange Commission~~activities.

~~Although the~~Long ~~forward-looking~~term ~~statements in this Quarterly Report reflect the good faith judgment of our management, such statements can~~secured ~~only~~loans beto ~~based~~refinance ~~on facts~~ and ~~factors~~acquire ~~currently~~additional ~~known by them. Consequently~~plant, ~~and~~equipment ~~because forward-looking statements are inherently subject to risks~~ and/or ~~uncertainties,~~other ~~the~~earnings ~~actual results~~ and ~~outcomes~~assets ~~may~~could ~~differ~~provide ~~materially~~cash ~~from~~flow ~~the~~income ~~results~~to ~~and outcomes discussed~~our ~~in the forward-looking statements~~investors. ~~You~~This ~~are~~lending ~~urged~~income tomay ~~carefully~~pass ~~review~~through interest and ~~consider~~fees ~~the~~paid ~~various~~for ~~disclosures~~secured ~~made~~loans byfor ussuch inpurposes. ~~this~~Leasing ~~report~~ revenues and fees inpaid ~~our~~from” ~~other~~borrowers” ~~reports~~ as werenters ~~attempt~~rather than to ~~advise~~owned ~~interested~~assets, ~~parties~~including ofsale ~~the~~lease ~~risks~~backs, ~~and factors that~~ may ~~affect~~also ~~our~~provide ~~business, financial~~cash ~~condition,~~income ~~and~~paid ~~results~~to ofour ~~operations and prospects~~investors.

~~General~~We cannot guarantee ~~Overview~~any rate of return results to our investors. However, we plan to payout 98% of the BDC net lending income to seek benefit from our intended RIC tax status.

~~We focus~~MODEL on2. ~~the~~CAPITAL development of opportunities to invest in eligible portfolio companies by providing either growth stage capital and/or “fix-it” capital for existing private or thinly traded public companies along with strategic guidance and operational support.APPRECIATION

~~Our principal~~Capital ~~objective~~ appreciation is ~~both~~sought ~~current~~from ~~consulting~~our ~~income~~equity participation and ~~long-term~~profit ~~capital~~realization ~~appreciation.~~from Wea ~~may~~sale ~~invest in debt securities~~ of ~~these~~ ~~companies,~~some or ~~may~~all ~~acquire~~of anour equity ~~interest~~ in ~~the~~a ~~form~~portfolio ofcompany’s investment. ~~common~~We ormay ~~preferred~~invest ~~stock,~~cash ~~warrants~~ and/or ~~options~~fees toearned ~~acquire~~and ~~stock or~~received ~~the~~for ~~right~~providing tomanagerial ~~convert~~support ~~the~~consulting ~~debt~~services ~~securities~~to ~~into~~a ~~stock~~client. The Wepercentage ~~may~~amount ~~invest~~of ~~alone,~~our orBDC asownership ~~part~~may ofbe apassive ~~larger~~at ~~investment~~less ~~group.~~than ~~Consistent with~~10% without our ~~status~~Board asof aDirector ~~BDC~~ and control positions in the ~~purposes~~portfolio ofcompany. ~~the~~This ~~regulatory~~may ~~framework~~allow ~~for~~us ~~BDC’s~~more ~~under~~unrestricted ~~the~~sale ~~1940~~of ~~Act,~~our weinvestment ~~will~~at ~~provide~~our ~~managerial assistance,~~sole ~~potentially~~discretion into attempt to maximize the ~~form~~return of athis ~~consulting~~investment. ~~agreement~~Or orwe inmay ~~the~~own ~~form~~a larger percentage of athe ~~board~~portfolio ofcompany ~~director’s~~including ~~seat,~~options to increase the ~~developing~~size ~~companies~~of inour ~~which~~ownership weand ~~invest~~control stake.

In addition, we may acquire either a minority or controlling interest in companies in a roll-up strategy. It is anticipated that any acquisitions will be primarily in exchange for our common stock, or a combination of cash and stock. The principal objective of acquisitions pursuant to a roll-up strategy would be to consolidate an industry and either sell the acquired entities as a larger unit, or take the unit public through an initial public offering, spin-off to our shareholders, or reverse merger into a publicly traded shell corporation.6

3We may also initiate and help develop a new controlling acquisition entity (“Newco”) for a particular industry. We may partner with specific industry management “experts” to help create this portfolio acquisition company in an industry to build revenue, profits and value of a Newco. We shall not directly operate such a Newco.

~~We shall~~The ~~currently~~main ~~operate~~strategy for asvalue ancreation ~~internally~~of ~~managed~~portfolio ~~investment~~companies ~~company~~is ~~until~~SEC ~~such~~registration ~~time~~for astransparency wewith ~~are~~financial ~~ready~~reporting toand ~~select~~liquidity ~~either~~through ~~an independent~~subsequent orSEC ~~affiliated~~registration ~~external~~for ~~management~~public ~~company~~stock ~~discussed below~~trading. ~~Our~~A ~~operations~~price ~~may~~to beearnings ~~governed~~multiple by“arbitrage” anratio ~~Investment~~between ~~Advisory~~public ~~Management~~stock and ~~Agreement~~private tostock bemay ~~entered~~increase ~~into~~our ~~between~~portfolio uscompany ~~and~~holding avalue. ~~new~~This ~~investment~~concept ~~advisory~~is ~~limited~~based ~~liability~~on ~~company~~the ~~which~~investment ~~may~~market bevalue ~~and probably will~~accretion befor ~~formed~~going ~~and~~from ~~wholly-owned~~private byto ~~our~~public ~~Chairman, George Morris~~status. WeFactors ~~have~~such ~~not~~as ~~elected~~financial toand ~~but~~operating ~~plan~~transparency, toquality ~~attempt~~of toliquidity, ~~qualify without a guarantee~~management ofand ~~success~~asset, orand ~~timing,~~earnings toacquisition beare ~~taxed~~improved aswhen a ~~regulated investment~~ company asis ~~defined~~publically ~~under~~traded ~~Subchapter~~versus Mprivately ofowned ~~the~~and ~~Internal Revenue Code~~operated.

~~Our~~Also, under the ~~common~~BDC Act, we can help “fix” business net income and other financial problems for existing “thinly traded” public stock ~~trades~~company onalready reporting to the ~~over~~SEC. Additional earnings and the ~~counter~~factors ~~bulletin~~such ~~board~~as ~~under~~improved financial and operating transparency, quality of liquidity, management and asset and further earnings acquisition can increase the ~~symbol~~value ~~“MBDE~~of a thinly traded portfolio company and our investment.”

Our shareholders ~~financial~~can ~~statements~~participate ~~have~~in ~~been~~our ~~prepared~~portfolio ~~assuming~~income weand ~~will~~capital ~~continue~~appreciation aswith aour ~~going~~fund ~~concern~~that byallows ~~our~~them ~~Board~~to ofshare ~~Directors.~~in ~~Because~~our wepotential ~~have~~share ~~historically~~value ~~incurred~~increase ~~operating~~from ~~losses,~~our ~~and~~investment. ~~expect~~We ~~those~~believe ~~losses~~the toshares ~~continue~~of a company we invest in ~~the~~should ~~future,~~trade ~~our~~at ~~Certified~~a ~~Public~~higher ~~Accountants~~price ~~included~~when that price anis ~~explanatory~~based ~~paragraph~~on inearnings ~~their~~increases ~~report~~and/or ~~raising~~an ~~substantial~~increased ~~doubt~~price ~~about~~earning ~~our~~multiple, ~~ability~~of toa ~~continue~~“successful” aspublic SEC reporting company, than on a ~~going~~non-reporting ~~concern~~privately held company. WeAny ~~are~~increase ~~reducing and/or~~share ~~will~~value ~~continue~~of toour ~~attempt~~portfolio ~~control~~investments ~~reductions~~should increase the Net Asset Value, (“NAV”) of our ~~operating~~BDC ~~cost~~and assubsequent ~~part~~market price of ~~operations~~our BDC traded shares listed under the OTCBB symbol: “MBDE.”

~~BUSINESS~~However, the success of these strategies and models by us cannot be guaranteed.

~~General~~We commenced our portfolio company investment activities several years ago with our first acquisition. Leep Company was brought to us by one of our Board members after the formation of our BDC and we received LPPI shares and no cash as payment for consulting advice. Contrary to our expectations, the Leep Company did not file audit reports with the SEC, nor did they generate anticipated net operating income. Our BDC went dormant until this year 2013 when a new Board of Directors was created with a new strategy requiring firm net income potential and SEC reporting status commitments from the managers of our portfolio investment.

~~Morris~~Currently, we are ~~Business~~internally ~~Development~~managed ~~Company,~~for ainvestment ~~California~~decisions ~~corporation~~by ~~(referred~~our toBoard asof ~~“we~~Directors,” ~~“us~~George Morris,” “our” ~~or the~~Chairman ~~“Company”)~~of ~~was~~the ~~incorporated~~Board onand ~~March~~Investment Committee. 10However, ~~1998,~~we inshall ~~the~~change ~~State~~our ofFund ~~California,~~management asto ~~Electronic~~an ~~Media~~external ~~Central~~management ~~Corporation~~advisor e. ~~Prior~~g. toMorris ~~our~~BDC ~~incorporation~~Management, weLLC ~~commenced~~(“Morris Investment”) ~~sales~~to ~~distribution~~facilitate ~~operations~~more inand ~~late~~new ~~1996~~technical asadvice aduring ~~division~~the offiscal ~~Internet~~year ~~Infinity~~ending March 31, ~~Inc~~2013. ~~(“Internet~~We cannot guarantee ~~Infinity”).~~Morris ~~Following~~Investment ~~our~~will ~~incorporation,~~achieve inregistered ~~April~~investment ~~1998,~~adviser westatus ~~continued~~upon tolicensing, ~~provide~~it ~~such~~shall ~~services~~serve as aour ~~100%~~investment ~~wholly~~adviser ~~owned subsidiary~~and ofalso ~~Internet~~provides ~~Infinity. Internet Infinity supplied~~ us with ~~management~~the ~~support~~administrative toservices ~~launch~~necessary ~~our~~for ~~Internet~~us ~~sales~~to ~~distribution activities~~operate.

OnWe plan but cannot ~~September~~guarantee ~~28,~~that ~~2001,~~our ~~all~~investment ~~500,000~~portfolio will consist of ~~our~~securities ~~issued~~that ~~and~~typically ~~outstanding~~produce ~~shares~~some ofcurrent ~~common~~income ~~stock,~~through ~~held~~interest or bydividend ~~Internet~~income. ~~Infinity,~~One ~~were~~investment ~~distributed~~objective is to maximize realized capital appreciation and/or an undetermined cash income paid from our investments. We seek to ~~the~~accomplish ~~Internet~~our ~~Infinity~~capital ~~shareholders~~appreciation ofobjective ~~record~~by asmaking portfolio investments in the equity securities of ~~September~~companies ~~18,~~with ~~2001~~a growing net operating income and shares trading valued at a publically traded price earnings multiple.

Our initial business focus in late 1996 was on distributing electronic media duplication and packaging services. These services were supplied through March 31, 2002. On May 12, 2006, we filed an election to be treated as a business development company (“BDC”) under the Investment Company Act of 1940 (the “1940 Act”), which became effective on the date of filing.7

OnWe seek to invest ~~March~~in ~~30,~~equity ~~2007~~securities of principally U.S.-based, weprivate ~~changed~~companies ~~our~~with ~~name~~a projected total enterprise value of between $2-million to ~~Morris~~$20-million ~~Business~~and ~~Development~~based ~~Company~~on ~~with~~three ~~the~~to ~~intent~~five times earnings. This same level of ~~operating~~earnings ascould ahave ~~BDC~~an estimated public share price significantly higher after going public, but the higher price cannot be guaranteed.

~~As of March 31~~Also, ~~2012~~investments may ~~George~~be ~~Morris,~~initiated ~~Ph.D.~~in ~~returned~~Newco totarget ~~operations~~companies ~~as the CEO of the Company~~ with ~~the~~under ~~full~~$1-million ~~motivation~~in toenterprise ~~build~~value ~~the mission~~for ofstrategic ~~the~~acquisition ~~Company~~reasons. ~~Dr.~~These ~~Morris and the~~ new acquisition ~~independent~~portfolio ~~Board~~companies ofmay ~~Directors~~be ~~plan~~used to ~~seek~~help ~~revenue~~create ~~and~~a ~~profits~~company prepared for ~~the~~further ~~Company through~~earnings ~~strategic~~growth ~~partnering~~from ~~and acquisitions as a Business Development Company, (“BDC”)~~acquisition.

~~Description of~~INVESTMENT ~~Business~~SOURCING

~~General~~We shall generally acquire our debt and/or equity securities through direct investments in prospective portfolio companies that meet our investment criteria. We use a structured approach for our initial investment assessment and continued portfolio monitoring. Also, we rely primarily on the detailed financial and business information we receive about the portfolio company and our access to and discussions with management, both prior to and after our investment. Our equity investments are typically acquired directly from the issuer in the form of convertible preferred stock and common stock. Our debt investments shall be generally in the form of secured corporate bonds/notes.

~~Most~~The equity securities ~~Business~~that ~~Development~~we ~~Companies~~acquire ~~(“BDC”)~~directly ~~that~~from ~~comply~~an ~~with~~issuer ~~the~~for ~~1940~~cash ~~Investment~~or ~~Act~~consulting services are ~~similar~~typically inthe ~~their~~issuer’s ~~business~~most ~~and~~senior preferred ~~investment~~stock ~~operations~~at ~~due to~~ the ~~standard~~time ~~compliance~~of ~~requirements.~~our ~~However~~investment or, ~~there~~in ~~are~~cases ~~significant~~where ~~differences~~we ~~between~~acquire ~~individual BDC~~common ~~philosophies~~shares; ~~and~~the ~~investment~~issuer ~~strategies.~~typically ~~Therefore,~~has only ~~careful~~common ~~reading~~stock outstanding. The proceeds of our ~~BDCs~~direct ~~SEC~~investments ~~filings~~of ~~and~~cash ~~other~~or ~~reports~~services ~~can~~are ~~point~~used by these companies for growth and/or working capital purposes ~~out~~as ~~our~~well ~~differences~~as in select cases for ~~the~~acquisitions. ~~benefit~~Debt ofis ~~the~~secured ~~reader~~by corporate and/or personal guarantees and assets.

~~Currently,~~Some of our direct weinvestments ~~are~~shall anbe ~~internally~~sourced ~~managed~~through venture capital funds, ~~diversified~~merger and acquisition specialists, ~~closed-end~~trade ~~management~~associations ~~Investment~~and ~~Company~~other financial or strategic investors that ~~has~~are ~~elected~~either toexisting beinvestors ~~regulated~~or asco-investors awith ~~business development~~us. ~~company~~We ~~under~~may ~~the~~also ~~Investment~~acquire ~~Company~~equity ~~Act~~or debt securities of ~~1940,~~companies asdirectly ~~amended~~from ~~(the~~current ~~“1940~~or ~~Act”).~~former Wemanagement ~~generally~~or ~~have~~early tostage ~~invest at~~investors ~~least~~in ~~70%~~private ofsecondary ~~our~~transactions, ~~total~~or ~~assets~~from incurrent or ~~“qualifying~~former ~~assets,”~~non-management ~~including~~employees ~~securities~~where ofthe ~~American~~portfolio ~~companies,~~company ~~cash,~~or ~~cash~~its ~~equivalents, U~~management is coordinating the transaction process.~~S.A.~~ ~~government~~The equity securities ~~and~~that ~~high-quality~~we ~~debt~~acquire ~~investments.~~directly ~~See~~from ~~“Regulation~~selling asstockholders aare ~~Business~~typically ~~Development~~common ~~Company”~~stock or notes and may not represent the most ~~below~~senior equity securities of the issuer.

4The debt securities may be sourced directly from a debtor, creditor or from market traders of such securities. In these private or public secondary transactions, we usually require an opportunity to conduct due diligence discussions with the portfolio company’s management, as well as to have access to the company’s business and financial information in connection with our investment and on an ongoing basis. We may also seek to negotiate terms, such as warrants or other structural protections, which are intended to provide some additional value protection or incentive from increases in the value of the related securities.

WeBy intention, our ~~plan~~structure tois ~~elect~~that toof bea ~~treated~~high ~~for~~risk/high ~~tax~~return ~~purposes~~investment asmodel. aWe ~~regulated~~seek ~~investment~~long-term ~~company,~~capital orappreciation athrough ~~RIC,~~investments ~~under~~in ~~Subchapter~~equity securities Mthat ofwe ~~the~~believe ~~Code~~will maximize our total return. ~~However~~In addition, ~~there~~ isour noequity ~~guarantee~~investments ~~that~~are weexpected ~~will~~to begenerate ~~successful~~some incurrent income ~~obtaining~~(i.e., dividends or ~~maintaining~~interest ~~our~~income), ~~RIC~~which ~~status.~~makes Asus atypical ~~new~~of ~~BDC~~other ~~operation,~~business wedevelopment ~~have~~companies ~~not~~that primarily make ~~yet~~debt ~~generated~~investments afrom ~~taxable~~which ~~profit~~they receive current yield in the form of interest income.

As a Fund, we focus our investments in companies that currently show net income from their operations or will show a net income from their operations in less than one year with our management and capital support.8

~~However~~We pursue both income and capital appreciation. Along with current income, a source of investment return will be generated from net capital gains, if any, realized on the disposition of our portfolio company investments, which typically will occur after a portfolio company completes our public stock registration and subsequent acquisition strategy. The portfolio company securities that we acquire are typically illiquid until going public or a ~~fund~~sale ~~pursuing~~of ~~both~~the ~~investor~~company. ~~income~~Therefore, ~~generation~~we cannot predict the regularity and ~~investor~~time periods between dispositions of our portfolio company investments and the realizations of capital ~~appreciation~~gains, ~~models~~if any, from such dispositions. Dispositions of our portfolio company investments are discretionary and based on our business judgment.

~~Therefore,~~Our goal is to facilitate financing for companies in growth industries that we ~~realize~~believe are capable of significant gains with capital and managerial support. Despite our limited track record, the transactions that anwe ~~investment~~plan ~~opportunity~~will establish our reputation with ~~future~~our ~~pay-off~~transparency, ~~results~~funding, ~~may~~acquisitions and ~~require~~managerial ~~additional~~advice ~~risk~~to ~~for~~selected ancompanies. ~~investment~~We inhave arelationships ~~portfolio~~developed by our founder, George Morris, after twenty five years ~~company~~in finance with venture capital firms, investment banks and trade associations, among others. We believe that iswe can source but not ~~currently~~guarantee ~~profitable~~access orto ~~positively~~both ~~cash~~investment ~~flowing~~opportunities and capital to reach our objectives.

~~Following~~Our strategy is ~~are~~to ~~the~~evaluate ~~two~~and ~~general~~invest ~~investment~~in ~~models~~a ~~currently~~broad ~~guiding~~range ~~our~~of ~~investment~~American ~~decision~~portfolio ~~process.~~companies, ~~However~~for example, ~~these~~but ~~descriptions~~not limited to energy, green technology, health, software and media, and other growth areas. Our advisory and management teams may besimultaneously ~~substantially~~develop our strategy with ~~modified~~other affiliated and non-affiliated BDCs or non-BDCs in ~~the~~industry ~~future~~and toother ~~pursue~~related ~~financial~~areas ~~gains~~where ~~for~~there is a potential conflict or support to our ~~BDC~~strategy in a specific industry or portfolio company investment.

~~Model~~We focus on financial 1reporting transparency prior to sourcing investment capital. Once we acquire a vested interest, we work with company management through offering significant managerial advice. This is ~~not~~followed ~~mutually~~by ~~exclusive~~further toearnings ~~Model~~acquisitions 2by and ~~our~~with ~~BDC~~the ~~may~~newly ~~actively~~acquired portfolio ~~pursue~~company ~~both~~to ~~Model~~accelerate 1earnings growth. Then we can move forward to becoming a public stock trading company when and 2if appropriate ~~simultaneously~~for us, with ~~both~~a ~~the~~possible ~~same~~increase in company and/or share value for the company. We believe in the private to public ~~different~~“arbitrage” ~~portfolio~~concept ~~companies~~based on earnings multiples, to further increase the capitalized earnings stream. However, we cannot guarantee successful results for the BDC with our strategy.

~~MODEL~~Some of the benefits 1.to ~~INCOME~~our ~~GENERATION~~shareholders investing in potential growth situation with income may be as follows; however, we may not be able to provide any of these benefits to our investors due to the high risk nature of our investment fund operations.

~~Income generation is sought from facilitating short terms secured loans to our portfolio companies and other non~~Public-~~portfolio~~ ~~companies, through~~traded ~~affiliated and non-affiliated lending sources. Operating capital loans may be used by our~~ investment ~~portfolio companies~~ for invoices, orders and inventory and may follow the factoring strategy operated for our BDC by affiliated and non-affiliated experienced factors. These are factors with existing experience, software and management systems in place. Our BDC investors may participate in the cash return yield generated by these activities.fund:

~~Long term~~We ~~secured~~are ~~loans~~a topublicly ~~refinance~~listed ~~and~~investment fund ~~acquire~~dedicated ~~additional~~to ~~plant,~~value ~~equipment~~creation ~~and/or~~opportunities, ~~other~~based ~~earnings~~on ~~and~~earning ~~assets could provide cash flow income to our investors~~growth. ~~This~~Also, ~~Lending~~we ~~income~~provide ~~may~~transparency ~~pass through interest~~ and ~~fees~~liquidity ~~paid for secured loans for such purposes. Leasing revenues and fees paid from” borrowers”~~ as ~~renters~~a ~~rather than to own assets, including sale lease backs, may also~~publically ~~provide~~traded ~~cash~~fund ~~income~~on ~~paid~~the toNASDAQ-OTCBB ~~our investors~~market.

~~We cannot~~Transparency ~~guarantee any rate~~ of ~~return results to our investors. However, we plan to payout 98% of the BDC net lending income to~~portfolio ~~seek benefit from our intended RIC tax status.~~investments

~~MODEL~~Our SEC reporting status requirement 2of our portfolio companies should give our investors more reliable information about our investments. ~~CAPITAL~~However, ~~APPRECIATION~~we cannot guarantee a portfolio company can achieve or maintain such SEC reporting status despite our experience with management of such reporting.

~~Capital Appreciation~~Liquidity is ~~sought~~both ~~from our equity participation and profit realization from a sale of some or all of our equity in a portfolio~~an ~~company’s~~outcome ~~investment. We may invest cash~~ and~~/or~~ ~~fees earned and received for providing managerial support consulting services to~~ a ~~client.~~driver ~~The percentage amount~~ of our ~~BDC ownership may be passive at less than 10% without our Board of Director and control positions in the portfolio company. This may allow us more unrestricted sale of our~~ investment at our sole discretion to attempt to maximize the return of this investment. Or we may own a larger percentage of the portfolio company including options to increase the size of our ownership and control stake.strategy:

~~We may~~As ~~also~~a ~~initiate~~public ~~and~~fund, we help offer ~~develop~~investors ain ~~new~~our ~~controlling~~fund ~~acquisition~~the ~~entity~~ability ~~(“Newco”)~~to ~~for~~sell aor ~~particular~~buy ~~industry~~interests in our fund through the public stock market. WeIn ~~may~~addition, we believe ~~partner~~there ~~with~~are ~~specific~~opportunities ~~industry~~for ~~management~~our ~~“experts”~~fund to ~~help~~acquire ~~create~~portfolio ~~this~~investment ~~portfolio~~positions ~~acquisition~~by ~~company~~swapping inor anbartering ~~industry~~our fund shares for discounted toportfolio ~~build~~company ~~revenue,~~shares. ~~profits~~Proper evaluation and ~~value~~negotiation ofcould aprovide ~~Newco.~~investment Weshares ~~shall~~in ~~not~~selected ~~directly~~companies ~~operate~~by swapping liquid public shares for less liquid portfolio shares until such aportfolio ~~Newco~~shares can also be traded.

The main strategy for value creation of portfolio companies is SEC registration for transparency with financial reporting and liquidity through subsequent SEC registration for public stock trading. A price to earnings multiple “arbitrage” ratio between public stock and private stock may increase our portfolio company holding value. This concept is based on the investment market value accretion for going from private to public status. Factors such as financial and operating transparency, quality of liquidity, management and asset and earnings acquisition may be improved when a company is publically traded versus privately owned and operated.9

5Also, liquidity outcomes from a portfolio investment are improved by the Business Development Company negotiations during both the acquisition and disposition of a portfolio investment.

~~Also, under the BDC Act, we can help “fix” business net income and other financial problems for an existing “thinly traded” public stock company already reporting to the SEC.~~ Additional ~~earnings and the factors such as improved financial~~Capitals ~~and operating transparency, quality of liquidity, management and asset and further earnings acquisition can increase the value of a thinly traded portfolio company and our investment.~~Sourcing:

~~Our shareholders~~The ~~can~~Business ~~participate~~Development ~~in our portfolio income and capital appreciation with our fund that allows them to share in our potential~~Company ~~share~~by ~~value~~its ~~increase~~assigned mission from ~~our~~Congress ~~investment.~~and Weits ~~believe~~designs ~~the~~has ~~shares of~~ a ~~company~~focus ~~we invest in should trade at a higher price when that price is based~~ on ~~earnings~~helping ~~increases~~provide ~~and/or~~capital anto ~~increased~~companies ~~price~~for ~~earning multiple, of a “successful” public SEC reporting company, than on a non-reporting privately held company~~growth. ~~Any~~This ~~increase share value of our portfolio investments should~~financial ~~increase~~leverage ~~the~~may ~~Net~~accelerate ~~Asset~~that ~~Value,~~growth ~~(“NAV”)~~ of ~~our~~earnings ~~BDC~~ and ~~subsequent~~portfolio ~~market~~share ~~price of our BDC traded shares listed under the OTCBB symbol: “MBDE~~value.”

~~However, the~~Management ~~success~~advice ~~of these strategies and models by us cannot be guaranteed.~~support:

~~We commenced~~The ~~our~~Business ~~portfolio~~Development ~~company investment activities several years ago when our first acquisition. Leep~~ Company ~~was brought to~~ us by ~~one~~its ofassigned ~~our~~mission ~~Board~~from ~~members~~Congress ~~after~~and ~~the~~its ~~formation~~design ofhas ~~our~~the ~~BDC~~opportunity and weresponsibility ~~received~~to ~~LPPI~~provide ~~shares~~substantial ~~and~~managerial ~~no cash as payment for consulting~~ advice~~. Contrary~~ to ~~our~~support ~~expectations,~~a ~~the~~portfolio ~~Leep~~investment ~~Company~~company’s ~~did not file audit reports with the SEC, nor did they generate anticipated net operating income~~success. ~~Our~~This ~~BDC~~managerial ~~went~~advice ~~dormant~~may ~~until~~accelerate ~~this~~that ~~year~~growth ~~2013 when a new Board~~ of ~~Directors~~earnings ~~was created with a new strategy requiring firm net income potential~~ and ~~SEC reporting status commitments from the managers of our~~ portfolio ~~investment. A tough~~ ~~lesson~~share ~~learned~~value.

~~Currently, we~~Access ~~are internally managed for investment decisions by our Board of Directors, George Morris, our Chairman of the Board and Investment Committee. However, we shall consider changing our Fund management~~ to an external management advisor e.g. Morris BDC Management, LLC (“Morris Investment”) to facilitate more and new technical advice during the fiscal year ending March 31, 2014. We cannot guarantee Morris Investment will achieve registered investment ~~adviser status but upon~~ ~~licensing. It shall serve as our investment adviser and also provides us with the administrative services necessary for us to operate.~~opportunities:

~~We plan~~With ~~but~~its ~~cannot~~higher ~~guarantee~~profile ~~that our investment portfolio will consist of securities that typically produce some current income~~created ~~through~~by ~~interest~~Congress, ora ~~dividend~~Business ~~income.~~Development ~~One~~Company ~~investment~~may ~~objective~~get isaccess to ~~maximize~~investments ~~realized~~probably ~~capital~~not ~~appreciation~~directly ~~and/or~~available ~~an undetermined cash income paid from our investments. We seek~~ to ~~accomplish~~non-BDC ~~our capital appreciation objective by making portfolio investments~~investors; inincluding ~~the~~individuals ~~equity securities of companies with a growing net operating income~~ and ~~shares trading valued at a publically traded price earnings multiple~~institutions.

~~We seek~~Experience ~~to invest in equity securities of principally U.S.-based, private companies~~ with ~~a projected total enterprise value of between~~SEC $2-million to $20-million and based on three to five times earnings. This same level of earnings could have an estimated public share price significantly higher after going public, but the higher price cannot be guaranteed.reporting:

~~Also,~~The cost and managerial expertise ~~investments~~necessary ~~may~~for beSEC ~~initiated~~reporting inand ~~Newco~~eventually ~~target~~“going ~~companies~~public” ~~with~~are ~~under~~mitigated ~~$1-million~~and incontrolled ~~enterprise~~through ~~value~~the ~~for~~advisory ~~strategic~~experience of ~~acquisition~~our ~~reasons~~Business Development Company. This advice included assistance in both going and remaining “public.” with continued ~~These~~compliance ~~Newco~~with ~~acquisition~~SEC ~~portfolio~~requirements. ~~companies~~Our ~~may~~BDC bemanagement ~~used~~has toextensive ~~help~~experience ~~create~~with athe ~~company~~management ~~prepared~~of ~~for~~nearly ~~further~~100 ~~earnings~~SEC ~~growth~~filings ~~from~~but we ~~acquisition~~cannot guarantee successful results with the SEC in any filing.

~~INVESTMENT~~Value of going ~~SOURCING~~public:

~~We shall~~Although ~~generally~~an ~~acquire~~increase ~~our debt and/or equity securities through direct investments~~ in ~~prospective portfolio companies that meet~~the ~~our~~value ~~investment~~of ~~criteria. We use~~ a ~~structured approach for our initial investment assessment and continued~~ portfolio ~~monitoring. Also,~~company wefrom ~~rely primarily on~~ the ~~detailed~~application ~~financial~~of ~~and business information that we receive about~~ the ~~portfolio~~price-earnings ~~company~~ratio ~~and~~arbitrage ~~our access~~concept tocannot ~~and~~be ~~discussions with management~~guaranteed, ~~both~~it ~~prior~~is toa ~~and after our investment. Our equity investments are typically acquired~~strategy ~~directly~~with ~~from~~historical ~~the issuer in the form of convertible preferred stock~~ and ~~common~~researched ~~stock~~support. ~~Our debt investments shall be generally in the form of secured corporate bonds/notes.~~

6The status of the Business Development Company:

~~The equity~~Compliance ~~securities~~with ~~that~~RIC ~~we acquire directly from an issuer for cash or consulting services are typically the issuer’s most~~Regulations ~~senior preferred stock at the time~~ of ~~our investment or, in cases where we acquire common shares;~~ the ~~issuer~~IRS ~~typically~~Code ~~has~~may ~~only common~~allow ~~stock~~earnings ~~outstanding.~~to ~~The~~pass ~~proceeds~~through ofto our ~~direct~~investor ~~investments~~without ofFederal ~~cash~~Government ortax. ~~services~~However, ~~are~~there ~~used~~is byno ~~these companies for growth and/or~~guarantee ~~working~~that ~~capital~~we ~~purposes~~will asinitially ~~well~~qualify asor incontinue ~~select~~to ~~cases~~qualify for ~~acquisitions.~~this ~~Debt~~tax ~~is secured by corporate and/or personal guarantees and assets~~benefit.

~~Some of~~Diversification ~~our direct investments shall be sourced through venture capital funds, merger~~ and ~~acquisition specialists, trade associations~~ ~~and~~risk other financial or strategic investors that are either existing investors or co-investors with us. We may also acquire equity or debt securities of companies directly from current or former management or early stage investors in private secondary transactions, or from current or former non-management employees where the portfolio company or its management is coordinating the transaction process. The equity securities that we acquire directly from selling stockholders are typically common stock or notes and may not represent the most senior equity securities of the issuer.mitigation:

The ~~debt~~ ~~securities~~Business ~~may~~Development beCompany by ~~source~~its ~~directly~~investment ~~from~~fund anature ~~debtor,~~offers ~~creditor~~diversification orand ~~from~~risk ~~market traders of such securities~~mitigation. InThis ~~these~~is ~~private~~also ~~or public~~while ~~secondary~~pursuing ~~transactions,~~a wehigher ~~usually~~return ~~require~~value ancreation strategy ~~opportunity~~for toits ~~conduct~~investment ~~due~~portfolio ~~diligence~~companies. ~~discussions~~There ~~with~~are ~~the~~no ~~portfolio~~guarantees ~~company’s management,~~of aspositive ~~well~~risk as to ~~have~~reward ~~access~~results tofrom ~~the~~an ~~company’s~~investment strategy ~~business~~ and/or ~~financial~~activities ~~information~~of ~~in connection with~~ our ~~investment and~~Business onDevelopment anCompany; ~~ongoing basis. We may also seek to negotiate terms~~however, ~~such~~we asbelieve ~~warrants~~our orstrategy ~~other~~can ~~structural~~enhance ~~protections,~~the ~~which~~probability ~~are intended~~of toour ~~provide~~success ~~some~~to ~~additional~~produce ~~value~~income ~~protection~~and orcapital ~~incentive~~gains ~~from~~for ~~increases~~our ~~in the value of the related securities~~investors.

By intention, our structure is that of a high risk/high return investment model. We seek long-term capital appreciation through investments in equity securities that we believe will maximize our total return. In addition, our equity investments are expected to generate some current income (i.e., dividends or interest income), which makes us typical of other business development companies that primarily make debt investments from which they receive current yield in the form of interest income.10

~~We pursue~~Other both income and capital appreciation. Along with current income, a source of investment return will be generated from net capital gains, if any, realized on the disposition of our portfolio company investments, which typically will occur after a portfolio company completes our public stock registration and subsequent acquisition strategy. The portfolio company securities that we acquire are typically illiquid until going public or a sale of the company. Therefore, , we cannot predict the regularity and time periods between dispositions of our portfolio company investments and the realizations of capital gains, if any, from such dispositions. Dispositions of our portfolio company investments are discretionary and based on our business judgment.notes:

~~Our goal~~We ~~is to facilitate financing for companies in growth industries that we believe~~ are ~~capable~~not ~~of significant gains with capital~~subject ~~and~~to ~~managerial~~requirements ~~support.~~to ~~Despite~~return ~~our~~invested ~~limited~~capital ~~track~~to ~~record,~~investors ~~the~~nor ~~transactions~~do ~~that~~ we ~~plan~~have ~~will~~finite ~~establish~~investment ~~our~~horizon. ~~reputation~~Also, ~~with~~capital ~~our~~providers such ~~transparency,~~as ~~funding~~us, ~~acquisitions~~subject ~~and managerial advice~~ to ~~selected~~such ~~companies.~~limitations Weare ~~have~~often ~~relationships~~required ~~developed~~to byseek ~~our~~liquidity ~~founder, George~~events ~~Morris~~more ~~after~~quickly ~~twenty~~than ~~five~~they ~~years~~otherwise ~~in business consulting~~might, ~~finance~~which ~~with venture capital firms, investment banks and trade associations,~~can ~~among~~result ~~others.~~in Wea ~~believe~~lower ~~that~~overall wereturn ~~can~~on ~~source but not guarantee access to~~ investment ~~opportunities, management and capital to reach our objectives~~.

~~Our strategy~~We isseek to ~~evaluate~~develop our ~~and~~first ~~invest~~investment inbeyond aour ~~broad~~current ~~range~~“token” holding of ~~American~~LPPI ~~portfolio~~shares ~~companies,~~received ~~for~~as ~~example~~consulting ~~but~~compensation. ~~not~~In ~~limited to energy~~fact, ~~green~~ ~~technology,~~we ~~health,~~totally ~~software~~wrote ~~and~~off ~~media~~the $12,500 ~~and~~portfolio ~~other~~value ~~growth~~as ~~areas.~~of ~~Our~~March ~~advisory~~31, ~~and~~2013 ~~management~~for ~~teams~~lack ~~may~~of ~~simultaneously develop our strategy with other affiliated and non-affiliated BDCs or non-BDCs in industry and other related areas where there is a~~ potential ~~conflict~~ ~~or support to our strategy in a specific industry or portfolio company investment~~gain.

~~We focus~~Quarterly ~~on financial reporting transparency prior to sourcing investment capital. Once we acquire a vested interest, we work with~~valuation ~~company~~of ~~management~~our ~~through~~portfolio ~~offering~~asset ~~significant managerial advice. This~~ is ~~followed~~a bymeasure ~~further~~of ~~earnings~~performance ~~acquisitions~~necessary byfor ~~and with~~ the ~~newly~~BDC ~~acquired portfolio company to accelerate earnings growth~~investors. ~~Then~~We weuse ~~can~~established ~~move~~valuation ~~forward~~procedures ~~to becoming a public stock~~ and ~~trading~~ ~~company~~assistance ~~when~~consistently ~~and~~applied ~~if appropriate for us, with a possible increase in company and/or share value for the company. We believe in the private~~ to ~~public~~provide ~~“arbitrage”~~investor ~~concept~~information ~~based~~ on ~~increased earnings multiples, to further increase~~ the ~~capitalized earnings~~value ~~stream.~~of ~~However, we cannot guarantee successful results for the BDC with~~ our ~~strategy~~portfolio.

7We may access the capital markets from time to time in the future to raise cash to fund new portfolio investments. We also intend to help file registration statements with the SEC to offer for sale, from time to time, shares of our common stock, in one or more underwritten public offerings, at-the-market offerings, negotiated transactions, block trades, best efforts or a combination of these methods. We intend to use the proceeds from these offerings to fund additional investments in portfolio companies consistent with our investment objective. There can be no assurance that we will be able to raise additional capital for investment purposes or, if we are able to do so, on terms favorable to us.

~~Some~~Without sufficient ofaccess ~~the benefits~~ to ~~our~~the ~~shareholders~~capital ~~investing~~markets, inwe ~~potential~~may ~~growth~~be ~~situation~~forced ~~with~~to ~~income~~curtail ~~may~~our bebusiness asoperations ~~follows:~~or ~~However,~~ we may not be able to ~~provide~~pursue new investment opportunities, which could decrease our investment income, if any, ofand ~~these~~cause ~~benefits~~our net asset value to ~~our~~deteriorate. As ~~investors~~of ~~due~~June 30, 2013 we had no indebtedness for borrowed money, and we currently do not desire to borrow funds in the ~~high~~foreseeable ~~risk~~future ~~nature~~to finance the purchase of our ~~investment~~investments ~~fund~~in ~~operations~~portfolio companies. Our advisor and management may change this position to develop and investment opportunity.

~~Public-~~If we do not generate ~~traded~~enough current income from our portfolio company investments, our operating expenses will be financed from our capital base during periods of time between realizations of capital gains on our investments. In addition, if we are successful in disposing of a portfolio company investment, ~~fund:~~we may reinvest the principal amount of our investment in new portfolio company opportunities. Or we may distribute gains to our stockholders after we pay any incentive fees earned by our investment adviser and our operating expenses.

~~We are~~Offering aof ~~publicly listed investment fund dedicated to value creation opportunities, based on earning growth. Also, we provide transparency and liquidity as a publically traded fund on the OTCBB market.~~Securities

~~Transparency~~From April 1, 2012 through March 31, 2013, we have not raised any capital in a public offering of ~~portfolio~~our ~~investments~~common stock. However, on March 30, 2012, with the approval of our independent Board of Directors, we eliminated the balance of our debt by converting the then existing up-to $100,000 debt to 5,000,000 restricted common shares at $0.02 per share. The trading price per unrestricted share was $0.02 at the time of the exchange. With Board agreement, George Morris converted the $100,000 in debt for 2,000,000 restricted shares at $0.05. The holder of the debt and now converted shares is Apple Realty, Inc., owned by our Board Chairman, George Morris.

~~Our~~The shares of our ~~SEC~~common ~~reporting~~stock ~~status~~are ~~requirement~~listed on the Over-the-counter Capital Market. There are 28,667,000 shares outstanding as of ~~our~~June ~~portfolio~~30, ~~companies~~2013, ~~should~~and approximately ~~give~~2,000,000 ~~our~~non-insider ~~investors~~shares ~~more~~are ~~reliable~~in ~~information~~the ~~about~~public float. George Morris, our ~~investments. However~~Chairman, wemay ~~cannot~~“trickle-out” sell ~~guarantee~~approximately aone-percent ~~portfolio~~per ~~company~~quarter ~~can~~of ~~achieve~~his orbeneficially ~~maintain~~owned ~~such~~shares ~~SEC~~in ~~reporting~~the ~~status~~near ~~despite~~future ~~our~~for ~~experience~~personal ~~with~~financial needs and ~~management~~to increase the non-insider public float shares. George has been the primary funding source of ~~such~~our ~~reporting~~BDC over the last five years of “hibernation”.

~~Liquidity is both an outcome and a driver of our investment strategy:~~11

~~As a~~Investment ~~public~~Management fund, we help offer investors in our fund the ability to sell or buy interests in our fund through the public stock market. In addition, we believe there are opportunities for our fund to acquire portfolio investment positions by swapping or bartering our fund shares for discounted portfolio company shares. Proper evaluation and ~~negotiation could provide investment shares in selected companies by swapping liquid public shares for less liquid portfolio shares until such portfolio shares can also be traded.~~Adviser

~~Also~~We are internally managed now by our Board of Directors and Independent Board of Directors Committees such as Investment and Audit Committees. However, ~~liquidity~~we ~~outcomes~~have ~~from~~the intention but cannot guarantee the success of becoming externally managed. The intended management company will be a ~~portfolio~~new investment ~~are~~adviser ~~improved~~created by Dr. George Morris that is registered under the ~~Business~~Investment ~~Development~~Advisers ~~Company~~Act ~~negotiations~~of ~~during~~1940, ~~both~~as amended (the ~~acquisition~~“Advisers Act”). The new Investment Advisor is expected to be appointed by March 31, 2014. The new investment adviser will be responsible for managing our day-to-day operations including, without limitation, identifying, evaluating, negotiating, closing, monitoring and ~~disposition~~servicing our investments. The new adviser will also provide us with the selected administrative services necessary for us to operate. Our investment activities will be managed by the new external advisor pursuant to an investment advisory and administrative services agreement (the “Investment Advisory and Administrative Services Agreement”) to be approved by our Board of Directors. We shall pay the new advisor a ~~portfolio~~fee for its investment advisory services under the Investment Advisory and Administrative Services Agreement consisting of two components – a two percent of asset value base management fee and a twenty percent realized performance incentive.

~~Additional~~The managing member ~~capitals~~and ~~sourcing:~~majority owner of the new Adviser shall be George P. Morris, PhD. Our investment adviser’s principals may be George P. Morris, our President, Chief Executive Officer and Chairman of our Board of Directors, a Chief Investment Officer, a Chief Operating Officer, Chief Compliance Officer, and some members of our Board of Directors, all yet to be recruited and retained. In addition, the new external advisor organization will employ other investment professionals dedicated to portfolio company origination, due diligence and financial analysis.

The new Advisor ~~Business~~shall ~~Development~~establish ~~Company~~an byinvestment ~~its~~committee ~~assigned~~(“Investment ~~mission~~Committee”) ~~from~~that ~~Congress~~must unanimously approve each new portfolio company investment that we make. Messrs. Morris and ~~its~~Paul ~~designs~~Rademaker ~~has~~of aour ~~focus~~Board onof ~~helping~~Directors ~~provide~~are ~~capital~~the tocurrent ~~companies~~members of the Investment ~~for~~Committee. ~~growth~~However, as the managing member of the new Advisor, Mr. ~~This~~Morris ~~financial~~has ~~leverage~~sole ~~may~~control ~~accelerate~~over ~~that~~the ~~growth~~appointment and removal of the ~~earnings~~members ~~and~~of ~~portfolio~~the ~~share~~Investment ~~value~~Committee.

~~Management~~Our new investment ~~advice~~adviser’s ~~support:~~principals shall have extensive experience in “taking companies public,” advising micro- and small-cap companies on capital markets strategies, and developing investor relations programs.

~~The~~George Morris currently has “hands-on” ~~Business~~experience ~~Development~~in ~~Company~~these byfinancial ~~its~~areas. ~~assigned~~Through ~~mission~~our ~~from~~investment ~~Congress~~adviser’s experience in taking companies public, we believe the principals of our investment adviser possess valuable insights on the trends affecting the going public and ~~its~~merger ~~design~~and ~~has~~acquisition markets. Also, there is experience in what contributes to the ~~opportunity~~completion of successful SEC registrations in the current market, going and ~~responsibility~~being public, share price drivers, investor exposure and sentiment, and industries or sectors that are in and out of favor. Our investment adviser is able to ~~provide~~use ~~substantial~~this ~~managerial~~experience ~~advice~~and insight as part of its disciplined approach to ~~support~~investment aassessment and adjust valuation expectations and portfolio ~~investment~~compositions ~~company~~as ~~success.~~public ~~This~~stock ~~managerial~~market ~~advice~~trends ~~may~~are ~~accelerate~~identified. However, we cannot guarantee ~~that~~the ~~growth~~success of ~~earnings~~our ~~and~~advisor ~~portfolio~~or ~~share~~management ~~value~~in these activities.

~~Access to investment opportunities:~~Governance

~~With~~Our Board of Directors ~~its~~(“Board”) ~~higher~~monitors ~~profile~~and ~~created~~performs byan ~~Congress,~~oversight arole ~~Business~~with ~~Development~~respect ~~Company~~to ~~may~~our ~~get~~business ~~access~~and affairs, including with respect to ~~investments~~investment ~~probably~~practices ~~not~~and ~~directly~~performance, ~~available~~compliance with regulatory requirements and the services, expenses and performance of our service providers. Also, our Board approves the appointment of our investment adviser and officers, reviews and monitors the services and activities performed by our investment adviser and officers, approves the engagement, and reviews the performance of, our independent registered public accounting firm, and provides overall risk management oversight. Pursuant to ~~non-BDC~~the ~~investors;~~requirements under ~~including~~the ~~individuals~~1940 Act and ~~institutions~~to satisfy our listing standards. Our Board is composed of a majority of non-interested, independent, directors.

~~Experience with SEC reporting:~~12

~~The cost~~Our ~~and~~Board ~~managerial~~shall create ~~expertise~~the ~~necessary~~Audit ~~for~~Committee, ~~SEC~~the ~~reporting~~Valuation Committee and ~~eventually~~the ~~‘going~~Nominating ~~public”~~Committee ~~are~~to ~~mitigated~~assist ~~and~~the ~~controlled~~Board in fulfilling its oversight ~~through~~responsibilities. ~~the~~Each ~~advisory~~of ~~experience~~these committees shall be composed solely of ~~our~~non-interested, ~~Business~~or ~~Development~~independent, ~~Company~~directors. ~~This~~The ~~advice~~Audit ~~included~~Committee’s responsibilities ~~assistance~~include inoverseeing ~~both~~our ~~going~~accounting and ~~remaining~~financial reporting processes, our systems of internal controls over financial ~~“public.”~~reporting, ~~with~~and ~~continued~~audits ~~compliance~~of ~~with~~our ~~SEC~~financial ~~requirements~~statements. ~~Our~~The ~~BDC~~Valuation ~~management~~Committee’s ~~has~~responsibilities ~~extensive~~include ~~experience~~reviewing ~~with~~preliminary portfolio company investment valuations from our investment adviser and making recommendations to our Board regarding the ~~management~~valuation of ~~nearly~~each ~~100~~investment in our portfolio as an SEC ~~filings~~reporting ~~but~~requirement. weThe ~~cannot~~Nominating ~~guarantee~~Committee’s ~~successful~~responsibilities ~~results~~include identifying ~~with~~qualified individuals to serve on our Board and to select, or recommend that the ~~SEC~~Board inselect, ~~any~~the ~~filing~~Board nominees.

~~Value of~~The ~~“going~~Investment ~~public:~~Environment

~~Although~~We operate within an ~~increase~~uncontrollable inenvironment ~~the~~of ~~value~~investment and economic market variables. Further we believe some of athis ~~portfolio~~uncertainty ~~company~~creates opportunity ~~from~~as well as risk. One opinion is that the ~~application~~American ofbanking system has failed American business and is not providing the ~~price-earnings~~capital ~~ratio~~needed ~~arbitrage~~by ~~concept~~business ~~cannot~~to beoperate ~~guaranteed~~and grow. And both the stock market and mergers and acquisition volatility have left the investors very uncertain about the investment market direction and value. However, we believe this same environment has created itopportunity isfor awell ~~strategy~~managed, ~~with~~transparent ~~historical~~investments and ~~researched~~the ~~support~~needed resources to grow value and income.

~~The~~Further, we believe ~~status~~and want to provide the assistance needed by business in this time of opportunity. We further believe that we can marshal the available resources to help business get what they need as an SEC registered Business Development Company as follows:

~~Compliance with~~Sourcing ~~RIC Regulations of the IRS Code may allow earnings to pass through to our investor without Federal Government tax. However,~~Capital ~~there~~Opportunities ~~is no guarantee that we will initially qualify or continue to qualify for this tax benefit..~~–

8We can’t “fix” a failed banking system. However, we can try to serve as a new kind of banking solution to our clients by facilitating access to needed capital. Secured debt has long been the kind of money that allowed American business to grow.

~~Diversification~~The expanding need for operations in areas of purchase order and ~~risk~~accounts ~~mitigation:~~receivable funding, sometimes called Asset Based Lending (“ABL”) needs to be filled. What is called “hard money” had negative connotation and costs that inhibited business from using this kind of money in the past. Today, we are seeing more acceptances such as ABL exhibitors with hard money at industry trade shows. And we are planning to be involved in the creation of an ABL Fund and developing other forms of ABL. In fact, other BDCs are specializing in “secured” loan transactions which are another form of ABL. We shall help our clients access all methods of raising operating capital, including ABL from both private and government sources.

~~The Business~~Another ~~Development~~client ~~Company~~capital need ~~by its investment fund nature offers diversification and risk mitigation. This~~ is ~~also while pursuing a higher return value creation strategy~~ for ~~its~~acquiring ~~investment~~plant ~~portfolio companies. There are no guarantees of positive risk to reward results from an investment strategy~~ and~~/or~~ ~~activities of our Business Development Company; however, we believe our strategy can enhance the probability of our success to produce income and capital gains for our investors~~equipment.

~~Other~~Leasing rather than ~~strategy~~owning ~~notes:~~can help facilitate the acquisition of needed equipment. We believe we can help our clients with specialized funds looking for longer-term secured loans and/or leases. And lease disclosure is part of the improved transparency required to investors and this kind of positive financial leverage can facilitate growth for our clients. We shall help our clients access better financial leasing sources through our BDC contacts.

We are not subject to requirements to return invested capital to investors nor do we have finite investment horizon. Also, capital providers such as us, subject to such limitations are often required to seek liquidity events more quickly than they otherwise might, which can result in a lower overall return on investment.13

WeSourcing equity ~~seek~~capital for growth is most challenging and has to ~~develop~~offer ~~our~~the ~~first~~investor ~~investment~~a ~~beyond~~significant ~~our~~gain ~~past~~for ~~“token”~~taking ~~holding~~the risk of ~~LPPI~~ownership ~~shares~~loss. We ~~received~~believe asnormal ~~consulting~~business ~~compensation~~growth in revenue and income may not be sufficient for the investor risk/return reward challenge. In ~~fact~~Therefore, we ~~have~~believe ~~written-off~~our financial model of increasing the $6market value of a company and its shares is another way of enhancing return to the equity investor. Specifically,~~250~~ our portfolio client companies moving through SEC reporting and then to SEC filing for trading their company shares is an investor opportunity. Multiplying the value received for ~~lack~~investment in the earnings of ~~potential~~a ~~gain~~successful public portfolio company can help offset the risk with an increase total return. It is a matter of transparency, solid financial and operating strategies and continuing access to capital.

~~Quarterly valuation~~Our ofInvestment our portfolio asset is a measure of performance necessary for the BDC investors. We use established valuation procedures and assistance consistently applied to provide investor information on the value of our portfolio.Strategy

WeOur investment objectives ~~may~~are ~~access~~to ~~the~~maximize capital ~~markets~~appreciation ~~from~~and ~~time~~pass-through tointerest ~~time~~and individend ~~the~~income ~~future~~from toour ~~raise~~portfolio ~~cash~~company investments to ~~fund new~~our ~~portfolio investments~~investors. We ~~also~~seek ~~intend~~ to ~~help~~accomplish ~~file~~our ~~registration~~capital ~~statements~~appreciation ~~with~~objective ~~the SEC~~through toequity ~~offer~~investments ~~for~~appreciation ~~sale,~~accelerated ~~from~~by ~~time~~earnings growth tomagnified ~~time,~~by ~~shares~~the ofprice ~~our~~earnings ~~common~~“arbitrage” ~~stock,~~resulting infrom ~~one~~becoming ora ~~more~~publically ~~underwritten~~traded ~~public~~stock ~~offerings~~company, ~~at-the-market~~versus ~~offerings,~~a ~~negotiated~~non-traded ~~transactions,~~private ~~block~~company. ~~trades~~Therefore, ~~best~~a ~~efforts~~major orsource aof ~~combination~~investment ofreturn ~~these~~will ~~methods.~~be Wegenerated ~~intend~~from tonet ~~use~~capital ~~the~~gains, ~~proceeds~~if any, ~~from~~realized ~~these~~on ~~offerings~~the todisposition ~~fund~~of ~~additional~~our portfolio company investments, inwhich typically will occur after a portfolio ~~companies~~company ~~consistent~~completes a ~~with~~public offering. However, our ~~investment~~equity ~~objective.~~investments ~~There~~are ~~can be~~also noexpected ~~assurance~~to ~~that~~generate wesome ~~will~~current beincome ~~able~~(i.e., todividends ~~raise~~or ~~additional~~interest income). ~~capital~~Our ~~for~~investing strategy relies on the expertise of our investment ~~purposes~~advisers ~~or,~~and ifbusiness wemanagerial ~~are~~support ~~able~~team to dosource opportunities ~~so,~~that onmeet ~~terms favorable~~our toinvestment usincome growth criteria.

~~Without sufficient~~We ~~access~~intend to ~~the~~maximize our potential for capital ~~markets,~~appreciation by taking advantage of the premium we ~~may~~believe beis ~~forced~~generally toassociated ~~curtail~~with ~~our~~having ~~business~~a ~~operations~~more transparent and liquid asset, such as a public SEC reporting and/or wereporting ~~may~~and/traded ~~not~~security. beWe ~~able~~believe toinvestors ~~pursue~~place a ~~new~~premium ~~investment~~on ~~opportunities~~transparency and liquidity, ~~which~~or ~~could~~having ~~decrease~~the ~~our~~ability ~~investment~~to ~~income,~~honestly if“know ~~any,~~what ~~and~~is ~~cause our~~going ~~net~~on ~~asset~~in ~~value~~a portfolio company” and to ~~deteriorate.~~sell Aspublic ofstock ~~December~~more 31quickly and efficiently, ~~2012~~trading wevalues ~~had~~should ~~near~~improve ~~zero~~once ~~indebtedness~~the ~~for~~portfolio ~~borrowed~~company ~~money,~~shares ~~and~~are weregistered ~~currently~~for dotrading, ~~not~~than ~~desire~~through private transactions. We believe that public companies typically trade at higher valuations – generally 2 to ~~borrow~~3 ~~funds~~times inor ~~the~~more ~~foreseeable~~– ~~future~~than private companies with similar financial results. By going public and listing on an exchange, we believe that our portfolio companies have the potential to ~~finance~~receive the ~~purchase~~benefit of ~~our~~this ~~investments~~information inand ~~portfolio~~liquidity ~~companies~~premium. There ~~Our~~can ~~advisor~~be no assurance that our portfolio companies will trade at these higher valuations once they are public and ~~management~~listed ~~may~~on ~~change~~an ~~this~~exchange or ~~position~~that tothey ~~develop~~can successfully register and ~~investment~~become ~~opportunity~~trading at all.

~~If we~~Because doof ~~not~~the ~~generate~~value differential ~~enough~~which ~~current~~we ~~income~~believe ~~from~~exists ~~our~~between ~~portfolio~~public ~~company~~and ~~investments,~~private ~~our~~companies ~~operating~~as ~~expenses~~a ~~will~~result ~~be financed from our capital base during periods~~ of ~~time~~the ~~between~~liquidity ~~realizations~~and oftransparency ~~capital~~premium, as ~~gains~~discussed ~~on our investments. In addition~~above, if we ~~are~~seek ~~successful in~~to ~~disposing~~make ofinvestments athat ~~portfolio~~create ~~company~~the ~~investment,~~potential wefor ~~may~~a ~~reinvest~~2 ~~the~~to ~~principal~~3 ~~amount~~times ofreturn on our investment inonce ~~new portfolio company~~the ~~opportunities.~~company Oris wepublicly ~~may~~traded ~~distribute~~and ~~gains~~there tois ~~our~~sufficient ~~stockholders~~time after wefor ~~pay~~investors ~~any~~to ~~incentive~~become ~~fees~~aware ~~earned~~of bythe ~~our~~quality ~~investment~~of ~~adviser and~~ our ~~operating~~portfolio ~~expenses~~investment.

~~Offering~~We shall pursue investments with a shorter expected investment success time, where we believe the portfolio company may file registration statements with the SEC for reporting and trading. The process of ~~Securities~~our realizing a maximum capital gain apart from the investment appreciation resulting from gains in operating earnings, could take as much as one to two years from initial SEC registration, legal market exposure and SEC “lockup” provisions prohibiting sale following a “going-public” offering. Once this lockup restriction expires, we may sell our shares in the portfolio company in the public markets. However, we have the discretion to hold our position to the extent we believe the portfolio company is not being appropriately valued in the public markets. We may pursue investments that have a shorter expected investment hold time but we cannot guarantee the timing results for our liquidation of an investment.

From April 1, 2011 through December 31, 2012, we have not raised any capital in a public offering of our common stock., However, on March 30, 2012, with the approval of our independent Board of Directors, we eliminated the balance of our debt by converting the existing up-to $100,000 debt at that time to 5,000,000 restricted common shares at $0.02 per share. The trading price per unrestricted share was $0.02 at the time of the exchange. With Board agreement, George Morris converted the $100,000 in debt for 5,000,000 restricted shares at $0.02. The holder of the debt and now converted shares is Apple Realty, Inc., owned by our Board Chairman, George Morris.14

~~The~~We are focused on ~~shares~~the ofpotential value transformation that we believe our ~~common~~portfolio ~~stock~~companies ~~are~~will ~~listed~~experience onas the ~~Bulletin~~result ~~Board~~of ~~Capital~~their ~~Market~~becoming ~~(“OTCBB”).~~reliably transparent ~~There~~with ~~are~~SEC ~~25,667,000~~reports ~~shares outstanding~~and asthen ofcomplete ~~September~~becoming ~~30,~~publicly ~~2012~~traded and ~~approximately~~achieve ~~2,000,000~~a ~~non-insider~~market ~~shares~~equity ~~are~~value incomparable ~~the~~to ~~public~~their ~~float~~publicly traded peers. ~~George~~We ~~Morris,~~target our investments in portfolio companies that we believe can complete this value transformation within our ~~Chairman~~projected ~~may~~12 ~~“trickle~~to 36-~~out”~~month ~~sell~~holding ~~approximately~~period. ~~one-percent~~As ~~per~~a ~~quarter~~result, ofwe ~~his~~may ~~beneficially~~have ~~owned~~low ~~shares~~or negative returns in ~~the~~our ~~near~~initial years with any potential ~~future~~valuation ~~for~~accretion ~~personal~~typically ~~financial~~occurring ~~needs~~in ~~and~~later years as our portfolio companies complete their becoming publicly traded. Growth of earnings to support an increase ~~the~~in ~~non-insider~~portfolio ~~public~~company ~~float~~value ~~shares~~cannot .be ~~George~~guaranteed ~~has~~but ~~been~~we ~~the~~believe, ~~primary~~good ~~funding~~portfolio company management ~~source~~with ofaggressive ~~our~~merger ~~BDC~~and ~~over~~acquisition ~~the~~work ~~last~~by ~~five~~management ~~years~~can shorten the process of ~~“hibernation~~the company gains.”

9Accurate information and the willingness of a major share owner along with existing desired management retention of potential portfolio investments greatly affect the selection of a company for investment by us. It is really about the valuation differential which we believe exists in a potential portfolio investment between their public and private status as a result of the transparency and liquidity premiums investors place on having the ability to know about the company and to sell stock quickly.

~~Investment~~We believe that ~~Management~~there are critical factors that will drive the success of our investment strategy, and ~~Adviser~~potentially enable us to meet our expected targeted return. The following explanations are some of the relevant concepts but this list is not intended to be complete.

~~We are~~● ~~internally~~Enterprise ~~managed~~value: ~~now~~We byfocus ~~our~~on ~~Board~~companies ofwith ~~Directors~~an ~~and~~enterprise ~~Independent~~value ~~Board~~ of ~~Directors~~typically ~~Committees~~between ~~such~~$2 asmillion ~~Investment~~ and ~~Audit~~ ~~Committees.~~$20 ~~However, we have the intention but cannot guarantee the success of becoming externally managed~~million. ~~The intended~~We ~~management~~believe ~~company~~companies ~~will be a new investment adviser created by Dr. George Morris or an independent that is registered under the Investment Advisers Act~~ of ~~1940,~~this assize ~~amended~~are ~~(the~~best ~~“Advisers~~positioned ~~Act”).~~to ~~The~~achieve ~~new investment adviser will be responsible for managing~~ our ~~day-to-day~~targeted ~~operations~~return ~~including,~~on ~~without limitation, identifying, evaluating, negotiating, closing, monitoring and servicing~~ our ~~investments. The new adviser will also provide us with the selected administrative/maintenance services necessary for us to operate such as management of SEC Filings. Our~~ investment ~~activities will~~once ~~be managed by~~ the ~~new~~company ~~external~~is ~~advisor~~publicly ~~pursuant~~reporting ~~to an investment advisory~~ and~~/or~~ ~~separate investment advisory and administrative maintenance services agreement (the “Investment Advisory and Administrative Services Agreement”) to be approved by our Board of Directors~~traded. WeThis ~~shall~~range ~~pay the new advisor a fee for its investment advisory services under the Investment Advisory and Administrative Services Agreement consisting~~ of ~~two~~equity ~~components~~value –could aincrease ~~two~~with ~~percent~~our ofincreased ~~asset~~track ~~value base~~record ~~management fee~~ and aincreased ~~twenty~~capital ~~percent~~available ~~realized~~for ~~performance~~portfolio ~~incentive~~investment.

~~The managing~~● ~~member~~Acquisition ~~and~~source. ~~majority~~We ~~owner~~seek ofprospective ~~the~~portfolio ~~new~~companies ~~Adviser~~where ~~may~~we becan ~~George~~purchase P.securities ~~Morris,~~directly ~~PhD.~~from ~~Our~~an ~~investment~~issuer ~~adviser’s~~or ~~principals may~~from bea ~~George~~selling P.stockholder ~~Morris,~~and ~~our~~can ~~President,~~obtain ~~Chief~~business ~~Executive Officer~~ and ~~Chairman~~financial ofinformation ~~our~~on ~~Board~~the ofportfolio ~~Directors,~~company. aThe ~~Chief~~approach ~~Investment~~we ~~Officer, a~~use ~~Chief~~to ~~Operating~~assess ~~Officer,~~our ~~Chief~~initial ~~Compliance~~investment ~~Officer,~~ and ~~some~~monitor ~~members of~~ our ~~Board~~portfolio ofinvestments ~~Directors,~~relies ~~all~~primarily ~~yet~~on tothe bedetailed ~~recruited~~financial and ~~retained. In~~business ~~addition,~~information ~~the~~we ~~new~~receive ~~external~~about ~~advisor~~the ~~organization~~company ~~will~~and ~~employ~~our ~~other~~access ~~investment~~to ~~professionals~~and ~~dedicated~~discussions towith ~~portfolio~~management, ~~company~~both ~~origination, due~~prior ~~diligence~~to and ~~financial~~after ~~analysis~~our investment.

~~The new~~● ~~Advisor~~Debt ~~shall~~and/or ~~establish~~equity: anWe ~~investment~~seek ~~committee~~to ~~(“Investment~~acquire ~~Committee”)~~secured debt with conversion privileges or options to acquire common stock or equity securities that ~~must~~are ~~unanimously~~typically ~~approve~~the ~~each~~issuer’s ~~new portfolio~~most ~~company~~senior preferred stock at the time of our investment. ~~that~~In cases where we ~~make.~~acquire ~~Messrs~~common shares, the issuer typically has only common stock outstanding. ~~Morris~~We believe that investing in an issuer’s most senior and/or ~~Paul~~secured ~~Rademaker~~debt ofor ~~our~~equity ~~Board~~securities ofprovides ~~Directors~~some ~~are~~protection ~~the~~and ~~current~~is ~~members of~~one way to potentially mitigate the ~~Investment~~otherwise ~~Committee~~high risks investing. ~~However,~~Since assecurities that we acquire directly from selling stockholders may not represent the ~~managing~~most ~~member~~senior securities of the ~~new~~issuer, ~~Advisor~~we may seek to negotiate terms, Drsuch as warrants or other structural protections, which are intended to provide some additional value protection. ~~Morris~~Although ~~has~~we ~~sole~~seek ~~control~~to ~~over~~invest in the ~~appointment and~~most ~~removal~~senior class of securities or obtain other protections, the ~~members~~seniority and other protections provided in these types of investments may be diminished if the ~~Investment~~portfolio ~~Committee~~company issues more senior securities in a subsequent financing round.

~~Our new~~● Acquisition price: We seek the acquisition of private securities at a valuation that creates the potential for our target “arbitrage” return on our investment ~~adviser’s~~once ~~principals~~the ~~shall~~company ~~have~~is ~~extensive~~publicly ~~experience~~traded. We believe that “buying right” at a lower price earnings multiple is one of the keys to success along with growth of earnings in ~~taking~~our ~~companies~~portfolio ~~public,~~company ~~advising~~from ~~micro-~~either or both organic growth and ~~small-cap companies~~further onacquisitions ~~capital~~of ~~markets~~earnings ~~strategies,~~from ~~and~~additional ~~developing~~investments ~~investor~~in ~~relations~~other ~~programs~~related companies.

George Morris currently has “hands-on” experience in these financial areas. Through our investment adviser’s experience in taking companies public, we believe the principals of our investment adviser possess valuable insights on the trends affecting the going public and merger and acquisition markets. Also, there is experience in what contributes to the completion of successful SEC registrations in the current market, going and being public, share price drivers, investor exposure and sentiment, and industries or sectors that are in and out of favor. Our investment adviser is able to use this experience and insight as part of its disciplined approach to investment assessment and adjust valuation expectations and portfolio compositions as public stock market trends are identified. However, we cannot guarantee the success of our advisor or management in these activities.15

~~Governance~~As of June 30, 2013 we are reviewing the offering status of potential portfolio investments, but have not made a “firm” deal for investment or business development.

~~Our~~We ~~Board~~do ofnot ~~Directors~~intend ~~(“Board”)~~to ~~monitors~~borrow ~~and~~funds ~~performs~~in anthe ~~oversight~~foreseeable ~~role~~future ~~with~~to ~~respect~~finance tothe purchase of our ~~business~~investments ~~and~~in ~~affairs~~portfolio companies, ~~including~~but ~~with~~we ~~respect~~have tothe ~~investment~~discretion ~~practices~~to ~~and~~do ~~performance~~so. However, ~~compliance~~we ~~with~~have ~~regulatory~~reduced ~~requirements~~our ~~and~~debt ~~the~~to ~~services,~~near ~~expenses~~zero ~~and~~as ~~performance~~ of June 30, 2013, to facilitate our ~~service~~company raising ~~providers~~additional equity or debt capital if we desire. ~~Also~~However, ~~our~~in ~~Board~~the ~~approves~~event we do borrow funds to make investments, we are exposed to the ~~appointment~~risks of ~~our~~leverage, ~~investment~~which ~~adviser~~may ~~and~~be ~~officers~~considered a speculative investment technique. Borrowings, ~~reviews~~also ~~and~~known ~~monitors~~as leverage, magnify the ~~services~~potential ~~and~~for ~~activities~~gain ~~performed~~and byloss ~~our~~on ~~investment~~amounts ~~adviser~~invested and ~~officers,~~therefore ~~approves~~increase the ~~engagement,~~risks ~~and~~associated ~~reviews~~with ~~the~~investing ~~performance~~in our securities. ofIn addition, ~~our~~the ~~independent~~costs ~~registered~~associated ~~public~~with ~~accounting~~our ~~firm~~borrowings, ~~and~~including ~~provides~~any ~~overall~~increase ~~risk~~in the management ~~oversight.~~fee ~~Pursuant~~payable to ~~the~~our ~~requirements~~investment adviser, ~~under~~will ~~the~~be ~~1940~~borne ~~Act~~by ~~and~~our tocommon ~~satisfy~~stockholders. We ~~the~~also ~~OTCBB~~do ~~listing~~not ~~standards,~~intend ~~our~~to ~~Board~~lend isthe ~~composed~~securities of aour ~~majority~~publicly oftraded ~~non-interested, independent~~portfolio ~~directors~~companies to generate fee income.

~~Our Board~~Investment shall create the Audit Committee, the Valuation Committee and the Nominating Committee to assist the Board in fulfilling its oversight responsibilities. Each of these committees shall be composed solely of non-interested, or independent, directors. The Audit Committee’s responsibilities include overseeing our accounting and financial reporting processes, our systems of internal controls over financial reporting, and audits of our financial statements. The Valuation Committee’s responsibilities include reviewing preliminary portfolio company investment valuations from our investment adviser and making recommendations to our Board regarding the valuation of each investment in our portfolio as an SEC reporting requirement. The Nominating Committee’s responsibilities include identifying qualified individuals to serve on our Board and to select, or recommend that the Board select, the Board nominees.Criteria

10We have identified numerous criteria we call qualifying and determining factors, to select our portfolio investments. We believe these criteria are important in meeting our investment objective. These core criteria are important for making our investment decisions; however, we may not require each prospective portfolio company in which we invest to meet all of these core criteria.

~~The Investment~~Business ~~Environment~~Model Validation:

WeCurrently generate ~~operate~~enough ~~within~~net anincome ~~uncontrollable environment of investment~~ and/or ~~economic~~cash ~~market~~flow ~~variables. Further we believe some of this uncertainty creates opportunity as well as risk. One opinion is~~ that ~~the~~can ~~American~~sustain ~~banking~~current ~~system has failed American business and is not providing the capital needed by business to operate and grow~~operations. And both the stock market and mergers and acquisition volatility have left the investors very uncertain about the investment market direction and value. However, we believe this same environment has created opportunity for well manage, transparent investments and the needed resources to grow value and income.

~~Further. We~~Gross ~~believe~~revenue and want to provide the assistance needed by business in this time of opportunity. We further believe that we can marshal the available resources to help business get what they need as an SEC registered Business Development company as followssize:

~~Sourcing~~$2-million to $20-million ~~Capital~~+/for ~~Opportunities~~trailing –12-months or projected with high probability revenue contract.

WeEarnings acquisition ~~can’t~~is ~~“fix”~~ a ~~failed~~priority ~~banking~~for ~~system.~~growth ~~However,~~investment ~~we can try to serve as a new kind of banking solution to our clients by facilitating access to needed capital~~opportunities. ~~Secured debt has long been the kind of money that allowed American business to grow.~~

~~The expanding~~Portfolio ~~need~~company ~~for capital in areas of purchase order and accounts receivable funding, sometimes called Asset Based Lending (“ABL”)~~scalability needs to be filled. What is called “hard money” had negative connotation and costs that inhibited business from using this kind of money, in the past. Today, we are seeing more acceptances such as ABL exhibitors with ~~hard money at industry trade shows. And we are planning to be involved in the creation of an ABL Fund and developing other forms of ABL. In fact~~management, ~~other~~operations ~~BDCs are~~structure ~~specializing in “secured” loan transactions which are another form of ABL. We shall help our clients access all methods of raising operating capital, including ABL from both private~~ and ~~government~~resources ~~sources~~needed.

~~Another client~~Growth ~~capital need is for acquiring plant and equipment.~~industry:

~~Leasing rather~~Participate ~~than~~in ~~owning~~upward ~~can~~growth momentum ~~help facilitate the acquisition~~ of ~~needed~~an ~~equipment.~~industry ~~We believe we can help our clients with specialized funds looking for longer-term secured loans and/~~or ~~leases.~~within ~~And~~growing ~~lease~~market ~~disclosure is part of the improved transparency required to investors and this kind of positive financial leverage can facilitate growth for our clients~~segments. ~~We shall help our client’s access better financial leasing sources through our BDC contacts.~~

~~Sourcing equity~~Growth ~~capital for growth is most challenging and has to offer the investor a significant gain for taking the risk of ownership~~potential ~~loss.~~requires Wecompetitive ~~believe~~plan normal business growth in revenue and income may not be sufficient for the investor risk/return reward challenge. Therefore, we believe our financial model of increasing the market value of a company and its shares is another way of enhancing return to ~~the~~realize ~~equity~~both ~~investor.~~organic ~~Specifically, our portfolio client companies moving through SEC reporting~~ and ~~then~~acquire ~~to SEC filing for trading their company shares is an investor opportunity~~growth. Multiplying the value received for investment in the earnings of a successful public portfolio company can help offset the risk with an increase total return. It is a matter of transparency, solid financial and operating strategies and continuing access to capital.

~~Our~~Manageable competition ~~Investment~~with ~~Strategy~~industry growth and without dominance required.

~~Our investment~~Geographic ~~objectives are to maximize capital appreciation and pass-through interest and dividend income from our portfolio company~~concentration ~~investments~~efficient towith ~~our~~expandable investors. . We seek to accomplish our capital appreciation objective through equity investments appreciation accelerated by earning growth magnified by the price earnings “arbitrage” resulting for becoming a publically traded stock company, versus a non-traded private company. Therefore, a major source of investment return will be generated from net capital gains, if any, realized on the disposition of our portfolio company investments, which typically will occur after a portfolio company completes a public offering. However, our equity investments are also expected to generate some current income (i.e., dividends or interest income). Our investing strategy relies on the expertise of our investment advisers and business managerial support team to source opportunities ~~that meet our investment income growth criteria~~.

11Ability and desire of major stakeholders and independent directors to be a public company ASAP.

~~We intend~~Management tocommitment maximize our potential for capital appreciation by taking advantage of the premium we believe is generally associated with having a more transparent and liquid asset, such as a public SEC reporting and/or reporting and/traded security. We believe investors place a premium on transparency and liquidity, or having the ability to ~~honestly “know what is going on in a portfolio company” and to sell~~ public ~~stock more quickly and efficiently, Trading values should improve once the portfolio company~~ ~~shares~~reporting ~~are registered~~ for ~~trading,~~transparency than through private transactions. We believe that public companies typically trade at higher valuations – generally 2 to 3 times or more – than private companies with similar financial results. By going public and ~~listing~~demonstration ~~on an exchange, we believe that our portfolio companies have the potential to receive the benefit~~ of ~~this information and liquidity premium~~integrity. There can be no assurance that our portfolio companies will trade at these higher valuations once they are public and listed on an exchange or that they can successfully register and become trading at all.

~~Because of~~Management ~~the value differential which we believe exists between public and private companies as a result of the liquidity and transparency~~commitment ~~premium, as discussed above, we seek~~ to ~~make~~becoming ~~investments that create the potential for~~ a 2public totrading ~~3 times return on our investment once the~~ company iswith ~~publicly traded and there is sufficient time after for investors to become aware of the quality of~~ our ~~portfolio investment~~support.

We shall pursue investments with a shorter expected investment success time, where we believe the portfolio company may file registration statements with the SEC for reporting and trading. The process of our realizing a maximum capital gain apart from the investment appreciation resulting from gains in operating earnings, could take as much as one to two years from initial SEC registration, legal market exposure and SEC “lockup” provisions prohibiting sale following a “going-public” offering.. Once this lockup restriction expires, we may sell our shares in the portfolio company in the public markets. However, we have the discretion to hold our position to the extent we believe the portfolio company is not being appropriately valued in the public markets. We may pursue investments that have a shorter expected investment hold time but we cannot guarantee the timing results for our liquidation of an investment.16

~~We are~~ROI ~~focused~~Potential ~~on the potential value transformation that we believe our portfolio companies will experience as the result of their becoming reliably transparent~~ with ~~SEC reports and then complete becoming publicly traded and achieve a market equity value comparable~~ tocapital their publicly traded peers. We target our investments in portfolio companies that we believe can complete this value transformation within our projected 12 to 36-month holding period. As a result, we may have low or negative returns in our initial years with any potential valuation accretion typically occurring in later years as our portfolio companies complete their becoming publicly traded. Growth of earnings to support an increase in portfolio company value cannot be guaranteed but we believe, good portfolio company management with aggressive merger and ~~acquisition~~income ~~work by management can shorten the process of the company gains~~appreciation.

~~Accurate information~~Price ~~and~~earnings ~~the~~Ratio: ~~willingness~~ of ~~major share owner along with existing desired management retention of potential portfolio investments~~2-5 ~~greatly~~times ~~affect the selection of a company~~ for ~~investment by us. It is really about the valuation differential which we believe exists in a potential~~ portfolio ~~investment~~acquisition ~~between their public and private status as a result of the transparency and liquidity premiums investors place on having the ability~~ to ~~know~~facilitate ~~about~~maximum ~~the~~PE ~~company~~multiple ~~and~~arbitrage todifferential ~~sell stock quickly~~gain.

~~We believe~~Financial ~~that there are critical factors that will drive the success of our investment strategy,~~ and ~~potentially enable us to meet~~control ~~our~~structure ~~expected~~present ~~targeted~~and ~~return. Follow are explanations of some of the relevant concepts but this list is not intended to be complete.~~projected

●Exceptions ~~Enterprise~~to ~~value: We focus on companies with an enterprise value of typically between $2 million and $20 million. – We believe companies of this size~~ above are ~~best~~acceptable ~~positioned~~for tospecial ~~achieve~~situations ~~our~~at ~~targeted~~time ~~return on our investment once the company is publicly reporting and traded. This range~~ of ~~equity value could increase with~~ our ~~increased track record and increased capital available for portfolio~~ investment.

We believe we can execute our plan to recognize gains in 12 to 36 months from our investment. Time is of the essence. However, there can be no assurance that we will be able to achieve our targeted return on each or any of our portfolio company investments in our planned time frame or beyond.

●In ~~Acquisition~~addition, ~~source.~~there are Weother ~~seek~~factors ~~prospective~~outside ~~portfolio~~of ~~companies~~our ~~where~~control weand ~~can~~other ~~purchase~~criteria ~~securities~~for ~~directly~~investment ~~from~~decisions anin ~~issuer~~evaluating ora ~~from~~portfolio acompany ~~selling~~investment opportunity. ~~stockholder~~Some ~~and~~of ~~can~~the ~~obtain~~factors ~~business~~we ~~and~~must ~~financial~~consider ~~information~~include: on(I) ~~the~~decreased ~~portfolio~~demand for the company.’s ~~The~~products ~~approach~~or weservices, ~~use~~(ii) the company’s ability to ~~assess~~support ~~our~~its ~~initial~~competitive ~~investment~~positions and ~~monitor~~its ~~our~~ability ~~portfolio~~to ~~investments~~capitalize ~~relies~~on ~~primarily~~growth onopportunities, (iii) the continued ~~detailed~~existence ~~financial~~and availability of a competent and ~~business~~experienced ~~information~~management weteam, ~~receive~~continuing ~~about~~operating ~~the~~profits ~~company~~and cash and lack of fraud. We cannot guarantee our ~~access~~ability to ~~and~~deal ~~discussions~~ with ~~management,~~these ~~both~~variables ~~prior~~and threats to growth and ~~after our investment~~survival.

●Target Debt and/or equity: We seek to acquire secured debt with conversion privileges or options to acquire common stock or equity securities that are typically the issuer’s most senior preferred stock at the time of our investment. In cases where we acquire common shares, the issuer typically has only common stock outstanding. We believe that investing in an issuer’s most senior and/or secured debt or equity securities provides some protections and is one way to potentially mitigate the otherwise high risks investing. Since the securities that we acquire directly from selling stockholders may not represent the most senior securities of the issuer, we may seek to negotiate terms, such as warrants or other structural protections, which are intended to provide some additional value protection. Although we seek to invest in the most senior class of securities or obtain other protections, the seniority and other protections provided in these types of investments may be diminished if the portfolio company issues more senior securities in a subsequent financing round.Industries

●We ~~Acquisition~~focus ~~price:~~on Wemicro-cap, small-cap ~~seek~~and ~~the~~lower ~~acquisition~~middle ofmarket ~~private~~companies ~~securities~~across at a ~~valuation~~broad ~~that~~range ~~creates~~of ~~the~~growth ~~potential~~industries ~~for~~that ~~our~~we ~~targeted~~believe ~~“arbitrage”~~are ~~return~~being ontransformed ~~our~~by technological, ~~investment~~economic ~~once~~and ~~the~~social ~~company is publicly traded~~forces. WeA ~~believe~~typical ~~that~~example ~~“buying~~of ~~right” at~~ a ~~lower~~promising ~~price~~area ~~earnings~~of ~~multiple~~us is ~~one of~~ the ~~keys~~senior tocitizens ~~success~~living ~~along~~and ~~with~~housing industry. ~~growth~~The ofkey ~~earnings~~directive inis ~~our~~to ~~portfolio~~find ~~company~~the ~~from~~“right” ~~either~~portfolio orinvestment ~~both~~opportunities ~~organic~~for ~~growth~~our ~~and further acquisitions of earnings from additional investments in other related companies~~BDC...

~~As of December 31, 2012 we are reviewing the offering status of potential portfolio investments, but have not made a “firm” deal for investment or business development.~~Diversification

~~We do~~Beyond ~~not intend to borrow funds in the foreseeable future to finance the purchase of~~ our ~~investments in portfolio companies, but~~guidelines wefor ~~have~~satisfying the ~~discretion~~regulated toinvestment ~~do so. However~~company, weor ~~have reduced our debt to near zero for the fiscal year ended March 31~~RIC, ~~2012,~~diversification ~~to facilitate our company raising additional equity or debt capital if we desire. However~~requirements, ~~in the event~~ we do ~~borrow~~not ~~funds~~have tofixed ~~make~~guidelines ~~investments,~~for portfolio wediversification ~~are exposed to the risks of leverage~~and, ~~which~~as ~~may be considered~~ a ~~speculative investment technique. Borrowings~~result, ~~also~~our ~~known~~investments ~~as leverage,~~could ~~magnify~~be ~~the~~concentrated ~~potential for gain and loss on amounts invested and therefore increase the risks associated with investing~~ in ~~our~~relatively ~~securities.~~few Inindustry ~~addition~~sectors, ~~the~~geographic ~~costs~~areas ~~associated with our borrowings, including any increase in the management fee payable~~or toother ~~our~~descriptions ~~investment~~of ~~adviser, will be borne by our common stockholders~~concentration. WeFurther, we also doexpect ~~not~~that ~~intend~~all toor ~~lend~~a ~~the~~substantial ~~securities~~portion of our ~~publicly~~ ~~traded~~ portfolio ~~companies~~may tobe ~~generate~~invested in ~~fee~~illiquid ~~income~~securities.

~~Investment~~During our initial ~~Criteria~~investment period, the size of each of our investments will be generally based on our prevailing low level of our gross assets. Therefore, these investments typically represented more than our target size for each portfolio company investment of about 10% or less of gross assets if we are not seeking a control position.

WeBased on the early ~~have~~level ~~identified~~of ~~numerous~~our ~~criteria~~total assets, we ~~call~~expect ~~qualifying~~that ~~and~~the ~~determining~~size ~~factors~~of our individual portfolio company investments could range from approximately $500,000 to ~~select~~$5 million +/-, but we may invest more than this amount in certain situations. Depending on whether we are able to increase the amount of our invested capital or leverage our investment with the cooperation of our portfolio company, ~~investments~~the range of our potential investment size may increase. We ~~believe~~expect that most of our portfolio company investments ~~these~~will ~~criteria~~represent ~~are~~about ~~important~~5% into ~~meeting~~10% of our ~~investment~~gross ~~objective.~~assets ~~These~~at ~~core~~the ~~criteria~~time ~~are~~of ~~important~~investment. ~~for~~However, ~~making~~based on our investment adviser’s ~~decisions;~~assessment ~~however~~of each portfolio company’s relative quality, fundamentals and valuation, we may make company investments that could represent up to 20% or more of our gross assets at the time of investment. We expect these percentages will fluctuate over time based on a variety of factors including, but not ~~require~~limited ~~each~~to, ~~prospective~~additional ~~portfolio~~follow-on ~~company~~investments in ~~which~~existing weportfolio ~~invest~~companies, dispositions, unrealized appreciation or depreciation, an increased asset base as a result of the issuance of additional equity, or a decreased asset base as a result of repurchases of our own equity. An unplanned series of events or opportunities could lead to ~~meet~~a ~~all~~substantially higher percentage of ~~these~~ownership ~~core~~in ~~criteria~~a portfolio investment.

~~Business Model Validation:~~ 17

~~Currently~~We do not choose ~~generate~~specific ~~enough~~investments ~~net~~based ~~income~~on an allocation strategy of industry diversification and/ do not intend to rebalance our portfolio if one of our portfolio company investments increases in value relative to the remaining portion of the portfolio. As a result, our portfolio may be more vulnerable to events affecting a single economic sector, industry or ~~cash~~portfolio ~~flow~~company and, therefore, subject to greater potential volatility than a company that ~~can~~follows ~~sustain~~a ~~current~~more ~~operations~~diversified strategy.

~~Gross~~With our focus on ~~revenue~~companies ~~size:~~based with headquartered in California and the Southwestern United States, our investments in these areas will likely continue to comprise a large portion of our portfolio. While not a matter of portfolio management personal convenience, our management timely interaction with these portfolio companies is facilitated by this strategy. However, special opportunity circumstance may lead us to invest in portfolio companies outside California and outside the Southwestern United States. Also, we expect that many of the California-based portfolio companies that we may invest in will have significant operations and customers outside of California.

$2Further, as a business development company, we may invest in certain limited number of non-~~million~~U.S. companies that otherwise meet our investment criteria, subject to ~~$20-million~~the ~~+/for~~requirements ~~trailing~~of ~~12-months~~the or1940 ~~projected~~Act. ~~with~~However, ~~high~~we ~~probability~~do ~~revenue~~not ~~growth~~plan at this time to invest beyond the United States.

13Our Investment Sourcing

~~Earnings~~We believe that ~~acquisition~~we ishave a ~~priority~~structured ~~for~~approach ~~growth~~to source qualified investing opportunities from an established developed network of investors, advisers, and private companies that are very interested in participating with us in our transactions. We believe in a very open system to us composed primarily of venture capital firms, investment banking firms, and groups of law firms and accounting firms. Our management through George Morris has developed relationships over twenty five years with these leading participants to help us “prospect” for investment opportunities.

~~Portfolio~~Through these relationships, ~~company~~our ~~scalability~~investment network will help us locate qualified investment opportunities that may meet our investment criteria. We believe this approach will allow us to source the most attractive companies committed to working with our investment models. Our investing strategy relies on our expertise to source opportunities that we can validate as meeting our investment criteria. Our structure requires evaluation of company-provided business and financial information and access to management. Our BDC management will source our investments through its principal office located in Newport Beach, ~~operations~~California, ~~structure~~as well as through other actual and ~~resources~~virtual offices ~~needed~~and other organizations located throughout the United States.

~~Growth~~We expect that the ~~industry:~~primary source of our future portfolio company investment opportunities will be from our relationships with various members of the investment and business communities.

~~Participate~~With over twenty-five years’ experience in ~~upward~~the ~~growth~~in ~~momentum~~the investment banking community, the network available to us through George Morris, our Chairman and President, is established and open to our need for portfolio companies investments. The goals of anthis ~~industry~~network orare ~~within~~mutually ~~growing~~compatible ~~market~~and profitable ~~segments~~for legal compliance and motivation.

~~Growth~~As a micro to smaller middle market ~~potential~~BDC, ~~requires~~we ~~competitive~~can ~~plan~~complement the efforts of larger BDCs, venture capital firms and other investors in a larger targeted portfolio company. In addition, where we do not seek control features of the portfolio company, we may allow the private company’s existing management and board to ~~realize~~focus on executing its business strategy. We will, however, make available significant managerial assistance on both ~~organic~~a free and ~~acquire~~for ~~growth~~a fee basis to our portfolio companies as the BDC law requires. We may also seek to negotiate terms, such as warrants or other structural protections, which are intended to provide some additional value protection and profit.

~~Manageable competition with industry growth and without dominance required.~~18

~~Geographic~~We also shall source ~~concentration~~investment ~~efficient~~opportunities from our direct outreach to private companies. We have implemented a proactive marketing program to communicate with ~~expandable~~our ~~opportunities~~referral network and with companies that meet our investment criteria. In addition, we shall continue to build our reputation as a leading source of investment opportunity.

~~Ability and~~Portfolio ~~desire~~Company ofAnalysis ~~major stakeholders~~ and ~~independent directors to be a public company ASAP.~~ Selection

~~Management~~We use a structured approach to our initial investment assessment which relies primarily on the detailed financial and business information we receive about the company and our access to and discussions with management, both prior to and after our investment. We use this company information to prepare our initial valuation analysis, leveraging its experience in taking companies public. We also use our initial discussions with our portfolio company management teams to discuss their commitment to completing registration and going public to ~~reporting~~determine ~~for~~which ~~transparency~~are best positioned to meet or exceed their performance targets and ~~demonstration~~correspondingly ofachieve ~~integrity~~a market equity value comparable to their publicly traded peers.

~~Management~~Once we identify ~~commitment~~those tocompanies ~~becoming~~that awe ~~public~~believe ~~trading~~meet ~~company~~our atcriteria ~~appropriate~~and ~~time~~have ~~with~~indicated an interest in our ~~support~~value improvement model, we utilize an investment analysis and selection process as follows:

~~ROI Potential~~Qualifying ~~with capital and income appreciation.~~factors

~~Price~~We start with information ~~earnings~~from ~~Ratio:~~the company’s management and/or placement agent and conduct a preliminary evaluation of ~~2-5~~the ~~times~~opportunity ~~for~~with ~~portfolio~~primary focus ~~acquisition~~on understanding the business, historical and projected financial information, industry, competition and valuation. From here we try to ~~facilitate~~determine ~~maximum~~whether PEwe ~~multiple~~believe ~~arbitrage~~the ~~differential~~prospective ~~gain~~portfolio company will be able to satisfy our targeted return on investment.

~~Financial~~The results of this preliminary evaluation are presented to our Investment Committee, and ~~control~~typically ~~structure~~a ~~present~~decision is made whether to pursue the opportunity further based on the relative attractiveness of the opportunity, the expected investment horizon and ~~projected~~our assessment of the potential return on our investment, and our core investment criteria, compared to other opportunities currently available. The Investment Committee will select those portfolio company investment opportunities that best meet our investment criteria and present the greatest potential for achieving our target return on investment.

~~Exceptions to~~Determining ~~above are acceptable for special situations at time of our investment...~~factors

WeAfter Investment ~~believe~~Committee weselects ~~can~~a ~~execute~~portfolio ~~our~~company ~~plan~~investment toopportunity ~~recognize~~for ~~gains~~further inanalysis, 12we towill 36conduct ~~months~~research ~~from~~on ~~our~~the ~~investment.~~company’s prospects ~~Time~~and isindustry, ofparticipate in additional discussions with the ~~essence.~~company’s ~~However~~management, ~~there can~~placement beagent noand ~~assurance~~existing investors, ~~that~~and weprepare ~~will~~an beinternal ~~able~~investment tomemorandum ~~achieve~~which discusses our ~~targeted~~evaluation ~~return~~findings onand ~~each~~recommendations, ortogether with ~~any~~an ofinternal ~~our~~valuation ~~portfolio~~analysis ~~company~~outlining ~~investments in~~ our ~~planned~~acceptable ~~time~~valuation ~~frame~~ranges orfor ~~beyond~~an investment.

~~In addition,~~As ~~there~~part ~~are other factors outside~~ of our ~~control~~analysis, we ~~and~~will ~~other~~have ~~criteria~~discussions ~~for~~with ~~investment~~the ~~decisions in evaluating a portfolio~~ company’s ~~investment~~management ~~opportunity.~~and ~~Some~~advisers, ofand ~~the factors~~ we ~~must~~usually ~~consider~~request ~~include:~~to ~~(I)~~have ~~decreased~~access ~~demand~~to ~~for~~ the company’s ~~products~~ ormajor ~~services,~~stockholders. ~~(ii)~~These ~~the~~discussions ~~company’s~~generally ~~ability~~are tocentered ~~support~~on ~~its~~a ~~competitive~~review ~~positions~~of ~~and~~the ~~its~~company’s ~~ability~~financial history and projections to ~~capitalize~~understand onkey ~~growth~~supporting ~~opportunities~~assumptions, ~~(iii)~~ ~~the~~verification ~~continued~~of ~~existence~~the ~~and~~company’s ~~availability~~commitment ofto ago ~~competent~~public and ~~experienced~~the ~~management~~timing ~~team~~thereof, ~~continuing operating profits~~ and ~~cash~~the ~~and~~primary ~~lack of fraud.~~considerations, Wemetric ~~cannot~~achievements ~~guarantee~~being ~~our~~used ~~ability~~by tothe ~~deal~~company ~~with these variables and threats~~ to ~~growth~~justify ~~and~~its ~~survival~~pre-money valuation.

~~Target Industries~~19

~~We focus~~At onthis ~~micro-cap~~stage, ~~small~~we prepare an in-~~cap~~depth ~~and~~valuation ~~lower~~analysis ~~middle~~focused ~~market~~primarily ~~companies~~on ~~across~~comparable aprivate ~~broad~~transactions; ~~range~~market multiples of ~~growth~~public ~~industries~~ companies that we believe are ~~being~~ ~~transformed~~most ~~by technological~~comparable, ~~economic,~~and ~~political~~a ~~and~~discounted ~~social~~cash ~~forces~~flow analysis. ~~The~~Based ~~key~~on ~~directive~~our iscomprehensive valuation assessment, the Investment Committee typically makes a decision whether to ~~find~~proceed with an investment at a price and, the ~~“right”~~terms and conditions that we will propose for further negotiation. Each new portfolio company investment ~~opportunities~~that we make requires the unanimous approval of our ~~BDC~~investment adviser’s Investment Committee.

~~Diversification~~Variables and Negotiations

~~Beyond~~We believe that ~~our~~negotiating ~~guidelines~~investment ~~for~~terms ~~satisfying~~that ~~the~~are ~~regulated~~expected ~~investment~~to ~~company,~~provide oran ~~RIC,~~enhanced ~~diversification~~return ~~requirements,~~upon wecomplete doexecution ~~not~~of ~~have~~our ~~fixed~~model ~~guidelines~~is one additional ~~for~~important ~~portfolio~~way ~~diversification~~to ~~and,~~mitigate asthe aotherwise ~~result,~~high ~~our~~risks ~~investments~~associated with this transaction. Such structural protections could beinclude conversion ~~concentrated~~rights which would result in ~~relatively~~our ~~few~~receiving ~~industry~~shares ~~sectors,~~of ~~geographic areas~~common orstock ~~other~~at ~~descriptions~~a discount to any public offering upon conversion at the time of ~~concentration.~~starting ~~Further~~public trading, weor ~~also~~warrants ~~expect~~ that ~~all~~would orresult in our receiving additional shares for a ~~substantial~~nominal ~~portion~~exercise price at the time of public trading. In some cases, our ~~portfolio~~decision ~~may~~to pursue an investment opportunity will be dependent on obtaining ~~invested~~some instructural ~~illiquid~~protections ~~securities~~that are expected to enhance our ability to meet our targeted return on the investment.

~~During our~~Due ~~initial~~Diligence ~~investment~~and period, the size of each of our investments will be generally based on our prevailing low level of our gross assets. Therefore, these investments typically represented more than our target size for each portfolio company investment of about 10% or less of gross assets if we are not seeking a control position.Closing

14Prior to closing an investment, we conduct further due diligence with a focus on verifying or validating the primary considerations used by our Investment Committee in approving the investment, contacting where possible key suppliers, customers or industry sources, and verifying the company’s capitalization table and equity structure. The consummation of each investment will be subject to the satisfactory completion of our due diligence investigation, our confirmation and acceptance of the investment pricing and structure, our review and acceptance of definitive agreements and, the exercise of any applicable veto rights or rights of first refusal.

~~Based on~~Our ~~the~~Board ~~early level~~ of ~~our total assets, we expect that the size of our individual portfolio company investments could range from~~Directors ~~approximately~~and ~~$500,000~~advisers tohave $5extensive ~~million~~experience ~~+/-~~negotiating, ~~but~~structuring weand ~~may~~closing ~~invest~~these ~~more~~specialized ~~than~~equity ~~this~~purchase ~~amount~~transactions ~~in certain situations. Depending~~with onissuers ~~whether~~and weselling ~~are~~stockholders. ~~able~~As topart ~~increase the amount~~ of ~~our~~its ~~invested~~due ~~capital~~diligence orprocess, ~~leverage~~ our investment ~~with~~committee ~~the~~analyzes ~~cooperation of our portfolio company,~~ the ~~range~~complex ofcapital ~~our potential investment size may increase. We expect that most of our portfolio company investments~~structures ~~will~~which ~~represent~~companies ~~about~~typically 5%possess toincluding ~~10%~~multiple ofclasses ~~our gross assets at the time~~ of ~~investment.~~common ~~However, based on our investment adviser’s assessment of each portfolio company’s relative quality, fundamentals~~ and ~~valuation,~~preferred weequity ~~may~~securities ~~make~~with ~~company~~differing ~~investments~~rights ~~that~~with ~~could~~respect ~~represent up~~ to ~~20% or more of our gross assets at the time of investment. We expect these percentages will fluctuate over time based on a variety of factors including~~voting, ~~but not limited to~~dividends, ~~additional follow-on investments in existing portfolio companies~~redemptions, ~~dispositions,~~ ~~unrealized appreciation or depreciation~~liquidation, anand ~~increased~~conversion ~~asset~~rights. ~~base~~Our asinvestment acommittee ~~result~~and ofprincipals ~~the~~also ~~issuance of additional equity,~~have orexperience ain ~~decreased~~negotiating ~~asset~~matters ~~base~~relating ~~as a result of repurchases of our own equity. An unplanned series of events or opportunities could lead~~ to arights, ~~substantially~~restrictions ~~higher percentage~~ of ~~ownership~~transfer, ~~in a portfolio investment~~etc.

~~We do~~Portfolio ~~not~~Company ~~choose~~Investment specific investments based on an allocation strategy of industry diversification and do not intend to rebalance our portfolio if one of our portfolio company investments increases in value relative to the remaining portion of the portfolio. As a result, our portfolio may be more vulnerable to events affecting a single economic sector, industry or portfolio company and, therefore, subject to greater potential volatility than a company that follows a more diversified strategy.Structure

~~With our~~Our ~~focus~~portfolio ~~on companies based with headquartered in California and the Southwestern United States, our~~ company investments inwill ~~these areas could likely continue~~ to ~~comprise~~be acomposed ~~large portion~~ of ~~our portfolio. While not a matter of portfolio management personal convenience~~, ~~our~~ ~~management~~investments ~~timely~~primarily ~~interaction with these portfolio companies is facilitated by this strategy. However, our BDC management staff increases and special opportunity circumstance may lead us to invest~~ in ~~portfolio companies outside California and outside~~ the ~~Southwestern~~form ~~United~~of ~~States.~~secured ~~Also~~notes, wepreferred ~~expect~~securities that ~~many~~are ofconvertible into ~~the~~common ~~California-based~~stock, ~~portfolio~~common ~~companies~~stock, ~~that~~and wewarrants ~~may~~exercisable ~~invest~~into incommon ~~will have~~or ~~significant~~preferred ~~operations and customers outside of California~~stock.

~~Further, as~~At athe ~~business~~time ~~development~~of ~~company~~our investment, the equity securities we ~~may~~acquire ~~invest~~are ingenerally ~~certain~~illiquid ~~limited~~due ~~number~~to restrictions on resale and/or to the lack of an established trading market. Our investments are sometimes non-~~U.S.~~controlling ~~companies~~but ~~that~~we ~~otherwise~~may ~~meet~~seek ~~our~~observation ~~investment~~rights or other control features. We ~~criteria,~~offer ~~subject~~significant managerial assistance to ~~the~~our ~~requirements~~portfolio companies on a free or a fee basis. We expect many of our portfolio company investments to be in the ~~1940~~form ~~Act.~~of ~~However,~~debentures weor doloans ~~not~~that ~~plan~~are atconvertible ~~this~~into ~~time~~or tosettled ~~invest~~with ~~beyond~~common ~~America~~stock.

~~Our Investment Sourcing~~20

~~We believe~~The equity securities that we ~~have~~acquire adirectly ~~structured~~from ~~approach~~an toissuer ~~source~~are ~~qualified~~typically ~~investing~~the ~~opportunities~~issuer’s ~~from~~most ansenior ~~established~~preferred ~~developed~~stock ~~network~~at the time of our investment ~~investors~~or, ~~advisers,~~in ~~and~~cases ~~private~~where ~~companies~~we ~~that~~acquire ~~are~~common ~~very~~shares, ~~interested~~the inissuer ~~participating~~typically ~~with~~has usonly incommon ~~our~~stock ~~transactions~~outstanding. WeThe ~~believe~~equity insecurities that awe ~~very~~acquire ~~open~~directly ~~system~~from toselling usstockholders ~~composed~~are ~~primarily~~typically common stock and may not represent the most senior equity securities of ~~venture~~the ~~capital~~issuer. ~~firms~~However, ~~investment~~in ~~banking~~each ~~firms~~case, ~~and~~we ~~groups~~may ofseek ~~law~~to ~~firms~~negotiate ~~and~~terms, ~~accounting firms.~~such ~~Our~~as ~~management~~warrants ~~through~~or ~~George~~other ~~Morris~~structural ~~has~~protections, ~~developed~~which ~~relationships~~are intended ~~over~~to ~~more~~provide ~~than~~some ~~twenty~~additional ~~five~~value ~~years~~protection ~~with~~or ~~these~~opportunity ~~leading~~in ~~participants to~~the ~~help~~event usof ~~“prospect”~~SEC ~~for~~registration ~~investment~~and/or ~~opportunities~~going public.

~~Through these~~The ~~relationships,~~proceeds of our ~~investment~~direct ~~network~~investments ~~will~~are ~~help~~used usby ~~locate~~these ~~qualified~~companies ~~investment~~for ~~opportunities~~growth ~~that~~or ~~may~~working ~~meet~~capital ~~our~~purposes ~~investment criteria.~~as Wewell ~~believe~~as ~~this~~for ~~approach~~acquisitions. ~~will~~In ~~allow us to source the most attractive companies committed to working with our investment~~many ~~models.~~of ~~Our investing strategy relies on~~ our ~~expertise~~portfolio tocompanies, ~~source~~venture ~~opportunities~~capital ~~that~~funds weor ~~can~~other ~~validate~~financial asor ~~meeting~~strategic ~~our~~investors ~~investment criteria.~~are ~~Our~~either ~~structure~~existing ~~requires~~investors ~~evaluation~~or ~~of company~~co-~~provided business and financial information and access to management. Our~~investors ~~BDC~~in ~~management~~the ~~will~~round ~~source our investments through its principal office located~~ in ~~Newport~~which ~~Beach,~~we ~~California~~invest ~~as well as through other actual and virtual offices and other organizations located throughout the United States~~in.

We believe, if requested, ~~expect~~to ~~that~~establish the ~~primary~~price ~~source~~and ofother ~~our~~terms ~~future~~where ~~portfolio~~existing ~~company~~venture ~~investment~~capital ~~opportunities~~investors, ~~will~~who are also likely to have board seats and as such may be ~~from~~conflicted, ~~our~~prefer ~~relationships~~to ~~with~~have ~~various~~a new investor lead the financing round without granting a board seat to us. Since we may ~~members~~not ofrequire board seats or other control provisions, we allow the ~~investment~~current management and board to remain focused on executing the company’s business ~~communities~~strategy...

~~With over~~There ~~twenty-five~~is ~~years’~~no ~~experience~~assurance that inwe ~~the~~will be successful in ~~the~~negotiating ~~investment~~structural ~~banking~~protections ~~community~~and, ~~the~~if ~~network~~we ~~available~~are able to usobtain ~~through~~these ~~George Morris~~structural protections, ~~our~~it is ~~Chairman~~possible ~~and~~that ~~President~~these isprotections ~~established~~may ~~and~~be ~~open~~diminished toif ~~our~~the ~~need for~~ portfolio ~~companies~~company ~~investments.~~issues ~~The~~more ~~goals~~senior ofsecurities ~~this network~~in ~~are~~a ~~mutually~~subsequent ~~compatible and profitable for legal compliance and motivation~~financing round.

15Where we are not a lead investor, we typically will not have structural protections, although some variation may be included in certain investments to the extent negotiated by the lead investor in such transactions.

AsOur aconvertible ~~micro~~preferred tostock ~~smaller~~investments ~~middle~~typically ~~market~~carry ~~BDC,~~fixed weor ~~can~~adjustable ~~complement~~rate ~~the~~dividends ~~efforts~~and ofwill ~~larger~~generally ~~BDCs,~~have ~~venture~~a ~~capital~~preference over ~~firms~~common equity in the payment of dividends and ~~other~~the ~~investors in~~liquidation of a ~~larger~~portfolio ~~targeted~~company’s assets. This preference means that a portfolio company. Inmust ~~addition,~~pay ~~where~~dividends weon dopreferred ~~not~~stock ~~seek~~before ~~control~~paying ~~features~~any ofdividends ~~the~~on ~~portfolio~~its ~~company~~common equity and, wein ~~may~~some ~~allow~~cases, the ~~private~~holders ~~company’s~~of ~~existing~~all ~~management~~outstanding ~~and~~series ~~board~~of topreferred ~~focus~~stock would receive any preferred dividends based on ~~executing~~their ~~its~~respective ~~business~~preference amount ~~strategy.~~on Wea ~~will,~~pro ~~however~~rata basis. However, ~~make available~~in ~~significant~~order ~~managerial~~to ~~assistance~~be onpayable, ~~both~~dividends aon ~~free~~such ~~and~~preferred ~~for~~stock amust ~~fee~~be ~~basis~~declared toby ~~our~~the portfolio company’s ~~companies~~board asof directors. In the ~~BDC~~event ~~law~~dividends ~~requires. We~~on ~~may~~our ~~also~~preferred ~~seek~~stock toinvestments ~~negotiate~~are ~~terms~~non-cumulative, ~~such~~or asif ~~warrants~~the orboard of ~~other~~directors ~~structural~~of ~~protections~~a portfolio company does not declare a preferred dividend for a specific period, ~~which~~then ~~are~~we ~~intended~~will tonot ~~provide~~be ~~some~~entitled ~~additional~~to ~~value~~such ~~protection~~a ~~and~~preferred ~~profit~~dividend for such period.

We ~~also~~cannot ~~shall~~be ~~source~~guaranteed ~~investment~~to ~~opportunities~~receive ~~from~~dividend ~~our~~income ~~direct~~on ~~outreach~~our topreferred ~~private~~stock ~~companies~~investments. WeCumulative ~~have~~dividend ~~implemented~~payments aon ~~proactive~~preferred ~~marketing~~equity ~~program~~means todividends ~~communicate~~will ~~with~~accumulate ~~our~~even ~~referral~~if ~~network~~not ~~and~~declared ~~with~~by ~~companies~~the ~~that~~board ~~meet~~of ~~our~~directors ~~investment~~or ~~criteria~~otherwise made payable. In ~~addition~~such a case, weall ~~shall~~accumulated dividends ~~continue~~must typically be paid before any dividend on the common equity can be paid. However, there is no assurance that any todividends ~~build~~will ~~our~~be ~~reputation~~paid asby a ~~leading~~portfolio ~~source~~company even in the case of ~~investment~~cumulative ~~opportunity~~preferred dividends and, in most cases, the payment of any accumulated preferred dividends is likely to be deferred until conversion and, if paid, may be paid in shares of the issuer’s preferred or common stock.

~~Portfolio~~As of June 30, 2013, ~~Company~~we ~~Analysis~~have ~~and~~not ~~Selection~~made any cash investments.

We use a structured approach to our initial investment assessment which relies primarily on the detailed financial and business information we receive about the company and our access to and discussions with management, both prior to and after our investment. We use this company information to prepare our initial valuation analysis, leveraging its experience in taking companies public. We also use our initial discussions with our portfolio company management teams to discuss their commitment to completing registration and going public to determine which are best positioned to meet or exceed their performance targets and correspondingly achieve a market equity value comparable to their publicly traded peers.21

~~Once we~~Our ~~identify~~Investment ~~those companies that we believe meet our criteria and have indicated an interest in our value improvement model, we utilize an investment analysis and selection process as follows:~~Goals

~~Qualifying~~We seek to invest ~~factors~~in micro-cap, small-cap and lower middle market companies that we believe will be able to file an audited registration statement with the SEC within approximately 6 months or less after our initial investment, and complete a registration to issue portfolio company shares within approximately 12 months after the closing of our initial investment. However, there may be delays due to completion of auditor requirements or a strategy decision to delay trading of our portfolio company shares at our sole discretion.

~~We start~~After, registration with ~~information~~the ~~from~~SEC, the portfolio company’s ~~management~~may seek and~~/or~~ ~~placement~~obtain ~~agent~~an ~~and~~exchange ~~conduct~~listing when it is strategically advantageous. However, we typically will be subject to a ~~preliminary~~lockup ~~evaluation~~restriction ofwhich prohibits us from selling our investment during the customary 180-day period ~~opportunity~~following ~~with~~the ~~primary~~exchange ~~focus~~listing. onOnce ~~understanding~~this ~~the~~lockup ~~business~~restriction expires, ~~historical~~we ~~and~~expect ~~projected~~to ~~financial~~sell ~~information,~~some ~~industry,~~or ~~competition~~all of our shares in the portfolio ~~and~~company ~~valuation.~~in ~~From~~the ~~here~~public markets as are strategically advantageous. However, we ~~try~~have the sole discretion to ~~determine~~hold ~~whether~~our position to the extent we believe the ~~prospective~~portfolio company is not being appropriately valued in the public markets or is adversely affected by market or industry cyclicality. Accordingly, we anticipate our typical investment horizon for portfolio investments will be 12 to 36 months. We may pursue investments with a shorter expected investment horizon, where we believe the portfolio company may file for public trading of shares sooner than 12 months or has a registration statement filed at the time of our investment. In each case, we have the discretion to hold securities for a longer period. There can be no assurance that we will be able to ~~satisfy~~achieve our targeted return on ~~investment~~our investments in portfolio companies once they go public.

~~The results~~If ofthe ~~this~~private ~~preliminary~~companies in ~~evaluation~~which ~~are~~we ~~presented~~invest todo ~~our~~not ~~Investment~~perform ~~Committee~~as planned, ~~and~~they ~~typically~~may abe ~~decision~~unable isto ~~made~~successfully ~~whether~~complete ~~to pursue~~a ~~the~~security ~~opportunity~~public ~~further~~registration ~~based~~within our ontypical ~~the~~targeted ~~relative~~12 ~~attractiveness~~-month oftime ~~the~~frame, ~~opportunity~~or at all, ~~the~~or ~~expected~~may ~~investment~~decide ~~horizon~~to ~~and~~abandon ~~our assessment~~their ofplans. ~~the~~In ~~potential~~such ~~return~~cases, onwe will likely exceed our ~~investment,~~targeted 36-month holding period and ~~our~~the ~~core~~value ~~investment~~of ~~criteria,~~these ~~compared~~investments tomay ~~other~~decline ~~opportunities~~substantially ~~currently~~if the going public exit is no ~~available~~longer viable. ~~The~~We ~~Investment~~may ~~Committee~~also ~~will~~be ~~select~~forced ~~those~~to ~~portfolio~~take ~~company~~other ~~investment~~steps ~~opportunities~~to ~~that~~exit ~~best~~these ~~meet~~investments, ~~our~~including ~~investment criteria~~the ~~and~~use ~~present~~of the ~~greatest~~trading ~~potential~~platforms of ~~for~~private ~~achieving~~secondary ~~our~~marketplaces ~~target~~that ~~return~~specialize onin ~~investment~~the trading of private company securities.

~~Determining~~Although we expect ~~factors~~that some of our equity investments may trade on these trading platforms, the securities we hold will typically be subject to legal and other restrictions on resale that may prevent us from using these trading platforms or otherwise selling our securities, and will otherwise be less liquid than publicly traded securities. Furthermore, trading in private securities markets involves risks given the possible imbalance of information between such transaction participants. In addition, while some portfolio companies may trade on the trading platforms of private secondary marketplaces, we can provide no assurance that such a trading market will be available for particular companies, will continue or remain active, or that we will be able to sell our position in any portfolio company at the time we desire to do so and at the price we anticipate.

~~After~~Since we may not ~~Investment~~seek ~~Committee~~to ~~selects~~control a portfolio company, ~~investment~~we ~~opportunity~~may ~~for~~not ~~further~~expect ~~analysis~~to have input as to when, weor ~~will~~if, ~~conduct~~our ~~research~~portfolio oncompanies ~~the~~choose to pursue ~~company’s~~a ~~prospects~~SEC ~~and~~share ~~industry~~trading registration. In certain cases, ~~participate~~our portfolio companies may choose to delay the registration because of either adverse conditions in ~~additional~~their ~~discussions~~particular ~~with~~industry or the ~~company’s~~equity ~~management~~markets generally. In other cases, ~~placement~~our ~~agent~~portfolio companies may be ~~and~~performing ~~existing~~poorly ~~investors,~~or ~~and~~not ~~prepare~~achieving anthe ~~internal~~milestones that an investment ~~memorandum~~bank ~~which~~would ~~discusses~~require to underwrite a share offering. In such cases, our ~~evaluation~~portfolio ~~findings~~companies ~~and~~may ~~recommendations~~need to raise additional capital, which may cause dilution to, or adversely affect, our ownership ~~together~~interests, or we may have to make additional follow-on investments pro rata with another ~~internal~~investors ~~valuation~~in ~~analysis~~order ~~outlining~~to preserve our ~~acceptable~~rights and ~~valuation~~preferences ~~ranges~~of ~~for~~our aninitial investment.

As part of our analysis, we will have discussions with the company’s management and advisers, and we usually request to have access to the company’s major stockholders. These discussions generally are centered on a review of the company’s financial history and projections to understand key supporting assumptions, verification of the company’s commitment to go public and the timing thereof, and the primary considerations, metric achievements being used by the company to justify its pre-money valuation.22

16In certain situations, our portfolio companies may abandon the pursuit of registration altogether, because the completion of registration is no longer a realistic possibility or because another company seeks to acquire our portfolio company. If a portfolio company has abandoned plans to pursue registration and we are not able to liquidate our shares privately, the portfolio company may consider a sale or merger with a strategic buyer as a possible alternative to registration or pursue a strategic sale and exit strategy.

~~At this~~Portfolio ~~stage,~~Company we prepare an in-depth valuation analysis focused primarily on comparable private transactions; market multiples of public companies that we believe are most comparable, and a discounted cash flow analysis. Based on our comprehensive valuation assessment, the Investment Committee typically makes a decision whether to proceed with an investment at a price and, the terms and conditions that we will propose for further negotiation. Each new portfolio company investment that we make requires the unanimous approval of our investment adviser’s Investment Committee.Progress

~~Variables~~As part of our portfolio company investment, we typically require information rights that give us access to the company’s quarterly and ~~Negotiations~~annual financial statements as well as the company’s annual budget. Although we may not have a control position through our ownership or board seats, we attempt to have an on-going dialogue, on at least a quarterly basis, with our private portfolio company management teams to review the company’s business prospects, financial results, and exit strategy plans. We also monitor our portfolio for compliance with the requirements for maintaining our status as a business development company under the 1940 Act and a RIC for tax purposes.

~~We believe~~Since ~~that~~we ~~negotiating~~may ~~investment~~not be ~~terms~~in ~~that~~a ~~are~~position ~~expected~~ to ~~provide~~control anthe ~~enhanced~~management, ~~return~~operation ~~upon~~and ~~complete~~strategic ~~execution~~decision-making of ~~our~~the ~~model is~~companies ~~one~~we ~~additional~~invest ~~important~~in, ~~way~~a toportfolio company ~~mitigate~~may ~~the~~make ~~otherwise~~business ~~high~~decisions ~~risks~~with ~~associated~~which ~~with~~we ~~this~~disagree, ~~transaction...Such~~and ~~structural~~the ~~protections could~~stockholders ~~include~~and ~~conversion~~management ~~rights~~of ~~which~~such ~~would~~a ~~result~~portfolio incompany ~~our~~may take ~~receiving~~risks ~~shares~~or ofotherwise ~~common~~act ~~stock~~in atways athat ~~discount~~are adverse to ~~any~~our ~~public~~interests. ~~offering upon~~Due ~~conversion~~to at the ~~time~~lack of ~~starting~~liquidity ~~public~~for ~~trading,~~the orequity ~~warrants~~ investments that ~~would~~we ~~result~~will typically hold in our ~~receiving~~portfolio ~~additional~~companies, ~~shares~~we ~~for~~may ~~a nominal~~not ~~exercise~~be ~~price~~able atto ~~the~~dispose ~~time~~ of ~~public~~our ~~trading.~~investments Inin ~~some~~the ~~cases,~~event ~~our~~that ~~decision~~we todisagree with ~~pursue~~the anactions ~~investment~~of ~~opportunity~~a ~~will~~portfolio ~~be dependent~~company onor ~~obtaining~~its ~~some~~substantial ~~structural~~stockholders, ~~protections~~and ~~that~~may ~~are~~therefore ~~expected~~suffer toa ~~enhance~~decrease ~~our~~in ~~ability~~the tovalue ~~meet~~of our ~~targeted return on the~~ ~~investment~~investments.

~~Due~~We also use our ~~Diligence~~ongoing discussions with our portfolio company management teams to monitor their continued commitment to completing a registration and, ~~Closing~~when requested, to provide our insights on the current investment market and what we believe are the key differentiators for successful registration and share offering.

~~Prior to~~We ~~closing~~also anoffer ~~investment,~~significant managerial weassistance ~~conduct~~to ~~further~~our ~~due~~portfolio ~~diligence~~companies ~~with~~as arequires ~~focus~~for onregistered ~~verifying~~business ordevelopment ~~validating~~companies under the ~~primary~~Act. ~~considerations~~We expect ~~used~~that bythis ~~our~~managerial ~~Investment~~assistance ~~Committee~~will inlikely ~~approving~~involve ~~the~~consulting ~~investment,~~and ~~contacting~~advice ~~where~~for ~~possible~~the ~~key~~going ~~suppliers, customers or industry sources,~~ and ~~verifying~~staying ~~the~~public ~~company’s capitalization table~~ and ~~equity~~public ~~structure~~capital markets. As ~~The~~a ~~consummation~~business ofdevelopment ~~each~~company, ~~investment~~we ~~will~~are berequired ~~subject~~ to ~~the satisfactory completion of our due diligence investigation~~offer, ~~our confirmation~~ and ~~acceptance~~in ofsome ~~the~~cases ~~investment~~provide ~~pricing~~ and ~~structure,~~ ~~our~~be ~~review~~paid ~~and acceptance of definitive agreements and~~for, ~~the~~such ~~exercise~~managerial ~~of any applicable veto rights or rights of first refusal~~assistance.

~~Our Board~~Disposition of ~~Directors~~Investments ~~and~~in ~~advisers have experience negotiating, structuring and closing these specialized equity purchase transactions~~Publicly ~~with~~Traded ~~issuers~~Portfolio and selling stockholders. As part of its due diligence process, our investment committee analyzes the complex capital structures which companies typically possess including multiple classes of common and preferred equity securities with differing rights with respect to voting, dividends, redemptions, liquidation, and conversion rights. Our investment committee and principals also have experience in negotiating matters relating to rights, restrictions of transfer, etc.Companies

~~Portfolio~~Our primary source ~~Company~~of ~~Investment~~investment ~~Structure~~return will be generated from net capital gains realized on the disposition of our portfolio company investments, which typically will occur after a portfolio company completes a share trading registration. We are also typically prohibited from exiting investments in our publicly traded portfolio company until the expiration of the customary post-public lockup agreement. These agreements, which we are required to enter into as part of our initial investment, prohibit us and other significant existing investors from selling stock in the portfolio company or hedging such securities during the customary 180 days following an effective registration..

~~Our~~Also, the market prices of portfolio ~~company~~companies ~~investments~~that ~~will~~have torecently becompleted ~~composed~~a oftrading registration typically experience high volatility and are driven by such factors as overall market conditions, ~~investments~~the ~~primarily~~industry inconditions for the ~~form~~particular ofsector ~~secured~~in ~~notes,~~which ~~preferred~~the ~~securities~~portfolio company ~~that~~operates, ~~are~~the ~~convertible~~portfolio ~~into~~company’s ~~common stock~~performance, ~~common~~the ~~stock~~relative size of the public float, and ~~warrants~~the ~~exercisable~~potential ~~into~~selling ~~common~~activities of orother ~~preferred~~pre-registration ~~stock~~investors and possibly management.

At the time of our investment, the equity securities we acquire are generally illiquid due to restrictions on resale and/or to the lack of an established trading market. Our investments are sometimes non-controlling but we may seek observation rights or other control features. We offer significant managerial assistance to our portfolio companies on a free or a fee basis. We expect many of our portfolio company investments to be in the form of debentures or loans that are convertible into or settled with common stock,23

~~The equity~~Following ~~securities~~the ~~that~~lockup period, we ~~acquire~~may ~~directly~~be ~~from~~forced anto ~~issuer~~compete ~~are~~with ~~typically~~other ~~the~~selling ~~issuer’s~~stockholders ~~most~~for ~~senior~~a ~~preferred~~limited ~~stock~~availability ~~at the time~~ of ~~our~~liquidity ~~investment or,~~ in ~~cases~~our ~~where~~publicly wetraded portfolio ~~acquire common shares~~companies, ~~the~~which ~~issuer~~volume ~~typically~~may ~~has~~be ~~only~~inadequate, ~~common~~and ~~stock~~could ~~outstanding.~~result ~~The equity~~in ~~securities~~significant ~~that~~market weprice ~~acquire~~volatility ~~directly from selling stockholders are typically common stock~~ and ~~may~~a ~~not~~decline ~~represent~~in the ~~most~~ ~~senior~~value ~~equity securities~~ of ~~the~~our ~~issuer~~investment. ~~However,~~In insuch ~~each case~~cases, wethe ~~may~~value ~~seek~~of toour ~~negotiate~~investments ~~terms,~~may ~~such~~decline assubstantially ~~warrants~~ or ~~other~~we ~~structural protections,~~may ~~which~~be ~~are~~forced ~~intended~~ to ~~provide~~hold ~~some~~our positions ~~additional~~for ~~value~~longer ~~protection~~than orwe ~~opportunity~~anticipated, ~~in the event of SEC registration and/~~or ~~going~~ ~~public~~both.

~~The proceeds~~For of our ~~direct~~portfolio company investments ~~are~~where ~~used~~the bylockup ~~these~~period ~~companies~~has ~~for~~expired ~~growth~~and orthe ~~working~~stock ~~capital~~becomes ~~purposes~~freely astradable, ~~well~~we asmay ~~for~~not ~~acquisitions.~~begin selling automatically Inupon ~~many~~expiration of the lockup period. We expect to sell our ~~portfolio~~positions ~~companies~~over a period of time, ~~venture~~typically ~~capital~~during ~~funds~~the or12 ~~other~~months ~~financial~~following the orexpiration ~~strategic~~of ~~investors~~our ~~are~~lockup, ~~either~~although ~~existing~~we ~~investors~~ may sell more rapidly or ~~co-investors~~slowly in ~~the~~one ~~round~~or inmore ~~which~~block transactions. Factors that we ~~invest~~may consider ~~in.~~include, but are not limited to, the following:

17The target price determined by our investment adviser based on its business judgment and what it believes to be the portfolio company’s intrinsic value.

WeThe application ~~believe,~~of ifpublic ~~requested,~~company tomultiples ~~establish the price~~ and ~~other~~our ~~terms~~proprietary ~~where~~analysis ~~existing venture capital investors, who are also likely~~ to ~~have~~ ~~board seats and as such may be conflicted, prefer to have~~ a ~~new~~variety ~~investor~~of ~~lead~~operating ~~the~~metrics ~~financing~~for ~~round~~each ~~without~~portfolio ~~granting a board seat to us. Since we may not require board seats, or other control provisions, we allow the current management and board to remain focused on executing the~~ company~~’s business strategy~~.

~~There is~~The noprimary ~~assurance~~operating metrics that we ~~will~~typically beconsider ~~successful in negotiating structural protections and, if we~~ are ~~able to obtain these structural protections~~revenue, itEBITDA isand ~~possible~~net ~~that these protections may be diminished if the portfolio company issues more senior securities in a subsequent financing round~~income.

~~Where we~~Other ~~are~~factors ~~not~~that may abe ~~lead~~adversely ~~investor,~~or wefavorably ~~typically~~affecting wea ~~will~~particular ~~not~~portfolio ~~have~~company’s ~~structural~~stock ~~protections~~price, ~~although~~including ~~some~~overall ~~variation~~market ~~may~~conditions, industry becyclicality, ~~included~~or inissues ~~certain investments~~specific to the ~~extent~~portfolio ~~negotiated by the lead investor in such transactions~~company.

~~Our convertible~~While ~~preferred~~we ~~stock~~do ~~investments typically carry fixed or adjustable rate dividends and will generally have a preference~~not ~~over~~intend ~~common~~to ~~equity~~purchase stock in ~~the payment of dividends and the liquidation of~~ a portfolio company’s ~~assets.~~initial ~~This~~offering ~~preference~~or ~~means that~~in aopen ~~portfolio~~market ~~company~~transactions ~~must pay dividends on preferred stock before paying any dividends on its common equity and~~thereafter, inunder ~~some cases,~~certain ~~the~~circumstances, ~~holders~~we ofmay ~~all~~consider ~~outstanding~~making ~~series~~additional ofinvestments ~~preferred~~in ~~stock would receive any preferred dividends based on their respective preference amount on~~ a ~~pro~~publicly ~~rata~~traded ~~basis.~~portfolio ~~However,~~company in ~~order~~open tomarket ~~be payable~~purchases, ~~dividends~~which will onincrease ~~such~~our ~~preferred~~position ~~stock~~in ~~must be declared by~~ the ~~portfolio~~ company’s. ~~board~~However, ofwe ~~directors.~~may Inbe ~~the~~unable ~~event~~to ~~dividends~~make follow-on ~~our preferred stock~~ investments ~~are~~in ~~non-cumulative,~~our orpublicly iftraded ~~the board~~portfolio ofcompanies ~~directors~~as of a ~~portfolio~~result ~~company~~of ~~does~~certain ~~not~~regulatory ~~declare~~restrictions aon ~~preferred dividend for~~ a ~~specific~~business ~~period,~~development ~~then~~company’s weinvestments ~~will~~in ~~not~~publicly ~~be entitled~~traded tosecurities ~~such~~with amarket ~~preferred~~capitalizations ~~dividend~~in ~~for~~excess ~~such~~of ~~period...~~$250 million.

WeBecause the portfolio ~~cannot~~company besecurities ~~guaranteed~~that towe ~~receive~~acquire ~~dividend~~are ~~income~~typically onilliquid ~~our~~until ~~preferred~~a ~~stock~~public ~~investments.~~trading ~~Cumulative~~registration ~~dividend~~or ~~payments~~sale onof ~~preferred~~the company, we generally ~~equity~~cannot ~~means~~predict ~~dividends~~the ~~will~~regularity ~~accumulate~~and ~~even~~time ifperiods ~~not~~between ~~declared~~dispositions byof our portfolio company investments and the ~~board~~realizations of capital ~~directors~~gains, orif ~~otherwise~~any, ~~made~~from ~~payable~~such dispositions. InDispositions ~~such~~of aour ~~case, all~~portfolio ~~accumulated~~company ~~dividends~~investments ~~must~~are ~~typically~~discretionary beand ~~paid~~based ~~before~~on our ~~any~~business ~~dividend~~judgment. onSince ~~the~~we ~~common~~may ~~equity~~not ~~can~~generate becurrent ~~paid.~~income ~~However,~~from ~~there~~our isportfolio nocompany ~~assurance~~investments, our operating expenses ~~that~~and any ~~dividends~~dividend to our shareholders will be ~~paid~~financed byfrom aour ~~portfolio~~capital ~~company~~base ~~even~~during inperiods ~~the~~of ~~case~~time between realizations of ~~cumulative~~capital gains ~~preferred~~on ~~dividends~~our ~~and~~investments. In addition, if we are successful in ~~most~~disposing ~~cases~~of a portfolio company investment, we may reinvest the principal ~~payment~~amount of our investment in new portfolio company opportunities, with any ~~accumulated~~gain ~~preferred~~that ~~dividends~~we ismay ~~likely~~realize being distributed to beour ~~deferred~~stockholders ~~until~~after ~~conversion~~we ~~and,~~pay ifany ~~paid,~~incentive ~~may~~fees beearned ~~paid~~by inour ~~shares of~~investment ~~the~~adviser ~~issuer’s~~and ~~preferred~~our oroperating ~~common stock~~expenses.

AsThe trading platforms of ~~December~~private ~~31,~~secondary ~~2012~~marketplaces have also emerged as an alternative to traditional public equity exchanges to provide liquidity principally to the stockholders of venture capital-backed, weprivate companies. While these trading platforms have ~~not~~more ~~made~~limited ~~any~~transaction volume ~~cash~~than ~~investments~~public exchanges, they may provide us with access to potential purchasers interested in privately acquiring our positions in our portfolio companies that are unable to dispose of within our targeted time frame.

~~Our Investment Goals~~24

~~We seek~~Due to ~~invest~~the innature of ~~micro-cap~~our corporate structure, ~~small-cap~~we ~~and~~believe ~~lower~~that ~~middle~~we ~~market~~can ~~companies~~be ~~that~~a wepatient ~~believe~~investor ~~will~~in beour ~~able~~portfolio tocompanies ~~file~~allowing anthem ~~audited~~flexibility ~~registration~~to ~~statement~~access ~~with~~what ~~the~~may ~~SEC~~be ~~within~~shorter ~~approximately~~and 6more ~~months~~unpredictable orshare ~~less~~trading ~~after~~registration ~~our~~options, ~~initial~~when ~~investment,~~the timing and ~~complete~~pricing amay ~~registration~~be tobest ~~issue~~for ~~portfolio~~the company ~~shares~~and ~~within~~us. ~~approximately~~In 12the ~~months~~event ~~after~~of ~~the~~a ~~closing~~prolonged closure of ~~our~~the ~~initial~~new ~~investment.~~share ~~However~~issue public trading markets, ~~there~~we ~~may~~can be ~~delays~~flexible as our ~~due~~portfolio tocompanies ~~completion~~wait offor ~~auditor~~a ~~requirements~~market recovery or aseek ~~strategy~~alternative ~~decision~~exist strategies. Since we are not subject to ~~delay~~requirements ~~trading~~to return ofinvested ~~our~~capital ~~portfolio~~to ~~company~~investors, ~~shares~~we attypically ~~our~~are ~~sole~~not forced to seek a liquidity event more quickly than they otherwise might, ~~discretion~~which can result in a lower overall return on an investment.

After, registration with the SEC, the portfolio company may seek and obtain an exchange listing when it is strategically advantageous. However, we typically will be subject to a lockup restriction which prohibits us from selling our investment during the customary 180-day period following the exchange listing. Once this lockup restriction expires, we expect to sell some or all of our shares in the portfolio company in the public markets as are strategically advantageous. However, we have the sole discretion to hold our position to the extent we believe the portfolio company is not being appropriately valued in the public markets or is adversely affected by market or industry cyclicality. Accordingly, we anticipate our typical investment horizon for portfolio investments will be 12 to 36 months. We may pursue investments with a shorter expected investment horizon, where we believe the portfolio company may file for public trading of shares sooner than 12 months or has a registration statement filed at the time of our investment. In each case, we have the discretion to hold securities for a longer period. There can be no assurance that we will be able to achieve our targeted return on our investments in portfolio companies once they go public.Competition

18A large number of entities compete with us to make the types of investments that we target as part of our business strategy. We compete for such investments with a large number of venture capital funds, other equity and non-equity based investment funds such as business development companies, investment banks and other sources of financing, including traditional financial services companies such as commercial banks and specialty finance companies. Many of our competitors are substantially larger than us and have considerably greater financial, technical and marketing resources than we do. In addition, some of our competitors may require less information than we do and/or have higher risk tolerances or different risk assessments, which could allow them to consider a wider variety of investments and establish more relationships than we can. Furthermore, many of our competitors are not subject to the regulatory restrictions that the 1940 Act imposes on us as a business development company and, as a result, such companies may be more successful in completing their investments.

IfThere can be no ~~the~~assurance ~~private~~that ~~companies~~the incompetitive ~~which~~pressures we ~~invest~~face dowill not ~~perform~~have ~~as planned, they may be unable to successfully complete~~ a ~~security~~material ~~public registration~~adverse ~~within~~effect on our ~~typical targeted 12 -month time frame~~business, orfinancial ~~at all~~condition, and orresults ~~may~~of ~~decide to abandon their plans~~operations. ~~In such cases~~Also, we ~~will~~as ~~likely~~a ~~exceed~~result ~~our targeted 36-month holding period and the value~~ of ~~these~~this ~~investments~~competition, ~~may~~we ~~decline substantially if the going public exit is no longer viable. We~~ may ~~also~~not be ~~forced~~able to take ~~other~~advantage ~~steps~~of toattractive ~~exit~~investment opportunities ~~these~~from ~~investments,~~time ~~including~~to ~~writing them~~time, ~~off~~and towe ~~little~~can oroffer ~~zero~~no ~~value~~assurance ~~and~~that ~~the~~we ~~use~~will ofbe ~~the~~able ~~trading~~to ~~platforms~~identify ofand ~~private~~make ~~secondary~~investments ~~marketplaces~~ that ~~specialize~~are ~~in the~~consistent ~~trading~~with ofour ~~private~~investment ~~company securities~~objective.

~~Although we~~Investment ~~expect~~Advisory ~~that some of our equity investments may trade on these trading platforms, the securities we hold will typically be subject to legal~~ and ~~other restrictions on resale that may prevent us from using these trading platforms or otherwise selling our securities,~~Administrative ~~and~~Services will otherwise be less liquid than publicly traded securities. Furthermore, trading in private securities markets involves risks given the possible imbalance of information between such transaction participants. In addition, while some portfolio companies may trade on the trading platforms of private secondary marketplaces, we can provide no assurance that such a trading market will be available for particular companies, will continue or remain active, or that we will be able to sell our position in any portfolio company at the time we desire to do so and at the price we anticipate.Agreements

~~Since we~~We ~~may~~are ~~not seek to control a portfolio company, we may not expect to have input as to when, or if, our portfolio companies choose~~internally tomanaged ~~pursue~~presently aby ~~SEC share trading registration. In certain cases,~~ our ~~portfolio~~Investment ~~companies~~Committee ~~may~~and ~~choose~~Board toof ~~delay~~Directors ~~the~~until ~~registration~~such ~~because of~~time ~~either~~within ~~adverse conditions~~ in ~~their~~approximately ~~particular~~12-months ~~industry or the equity markets generally. In other cases~~that, our ~~portfolio companies~~ ~~may~~Board beof ~~performing~~Director ~~poorly~~selects ~~or not achieving the milestones that~~ an ~~investment~~external ~~bank would require to underwrite a share offering~~Adviser. In ~~such~~Our ~~cases,~~future ~~our~~external ~~portfolio~~investment ~~companies~~advisor ~~may~~shall ~~need~~be to(“Morris ~~raise additional capital, which may cause dilution to, or adversely affect,~~Advisement”) ~~our ownership interests,~~ or weanother ~~may~~licensed ~~have~~adviser tocompany ~~make~~selected ~~additional~~by ~~follow-on investments pro rata with other investors in order to preserve~~ our ~~rights~~Board ~~and preferences~~ of ~~our initial investment~~Directors.

~~In certain~~It ~~situations,~~is ~~our~~expected ~~portfolio companies may abandon the pursuit of registration altogether, because the completion of registration~~that isMorris noAdvisement ~~longer~~elected aby ~~realistic possibility or because another company seeks to acquire~~ our ~~portfolio~~Board ~~company.~~shall Ifbe aregistered ~~portfolio~~with ~~company has abandoned plans to pursue registration and we are not able to liquidate our shares privately,~~ the ~~portfolio~~SEC ~~company may consider a sale~~ or ~~merger~~by ~~with~~State aregulation ~~strategic~~according ~~buyer as a possible alternative~~ to ~~registration~~the orcurrent ~~pursue a strategic sale and exit strategy~~law.

~~Portfolio~~As an investment ~~Company~~adviser ~~Progress~~under the Advisers Act, although we are not aware of any current plans for our Investment Adviser to do so, our Adviser may also in the future provide similar investment advisory services to other entities in addition to us including other BDCs. In the event that our Advisor provides investment advisory services to other entities, our Adviser intends to allocate investment opportunities in a fair, logical and equitable manner as it solely determines pursuant to its allocation policies and procedures and in any event consistent with the fiduciary duties owed to us.

As part of our portfolio company investment, we typically require information rights that give us access to the company’s quarterly and audited annual financial statements as well as the company’s annual budget. Although we may not have a control position through our ownership or board seats, we attempt to have an on-going dialogue by agreement on at least a quarterly basis, with our private portfolio company management teams to review the company’s business prospects, financial results, and exit strategy plans. We also monitor our portfolio for compliance with the requirements for maintaining our status as a business development company under the 1940 Act and a RIC for tax purposes.25

~~Since we~~Subject ~~may not be in a position~~ to ~~control~~ the ~~management,~~overall supervision ~~operation~~of ~~and~~our ~~strategic~~Board ~~decision-making~~ of ~~the companies we invest in~~Directors, a ~~portfolio~~our ~~company~~Adviser ~~may~~shall ~~make~~manage ~~business~~our ~~decisions~~day-to-day ~~with~~operations ~~which we disagree,~~ and ~~the~~provides ~~stockholders~~us ~~and~~with ~~management~~investment ~~of such a portfolio~~advisory ~~company may take risks or otherwise act in ways that are adverse to our interests~~services. ~~Due~~Under to the ~~lack~~terms of ~~liquidity for~~ the ~~equity investments~~Investment ~~that~~Advisory weand ~~will~~Administrative ~~typically~~Services ~~hold in our portfolio companies~~Agreement, weas ~~may~~shall ~~not~~ be ~~able to dispose of our investments~~ in ~~the event that we disagree with the actions of a portfolio company or its substantial stockholders~~effect, ~~and may therefore suffer a decrease in the value of~~ our ~~investments and write-down the value of that investment to little value or zero.~~adviser Investments:

~~We also~~Determines ~~use~~the ~~our~~composition of ~~ongoing discussions with~~ our portfolio, ~~company~~the ~~management~~nature ~~teams~~and totiming ~~monitor~~of ~~their~~the ~~continued~~changes ~~commitment~~ to ~~completing a registration and, when requested, to provide~~ our ~~insights~~portfolio ~~on the current investment market~~ and ~~what we believe are~~ the ~~key~~manner ~~differentiators for~~of ~~successful~~implementing ~~registration~~such ~~and share offering.~~changes;

~~We also~~Determines ~~offer~~which ~~significant~~securities ~~managerial assistance to our portfolio companies as requires for registered business development companies~~we ~~under~~will ~~the~~purchase, ~~Act...~~retain Weor ~~expect~~sell; ~~that~~Identifies, ~~this~~evaluates ~~managerial assistance will likely involve consulting~~ and ~~advice~~negotiates ~~for~~ the ~~going~~structure ~~and~~of ~~staying public~~the ~~and~~investments ~~public capital markets. As a business development company,~~ we ~~are~~make; ~~required~~and ~~to offer~~closes, monitors and inservices ~~some~~the ~~cases~~investments ~~provide~~we ~~and be paid for, such managerial assistance~~make.

19Our external Adviser’s services under the Investment Advisory and Administrative Services Agreement will not be exclusive to us and the adviser is free to furnish similar services to other entities so long as its services to us are not impaired. Further, our investment adviser, its principals, investment professionals and the members of its Investment Committee may serve as investment advisers, officers, directors or principals of entities or investment funds that operate in the same or a related line of business as us and/or of investment funds managed by our affiliates.

~~Disposition~~We pay our Advisor a fee for its investment advisory services under the Investment Advisory and Administrative Services Agreement consisting of ~~Investments~~two components – a base management fee and an incentive fee. The cost of both the base management fee payable to our Adviser and any incentive fees earned by our Adviser is ultimately borne by our common stockholders. Our officers do not receive any compensation directly from us. However, the principals and officers of the investment adviser who also serve as the Company’s officers receive compensation from, or may have financial interests in, ~~Publicly~~the ~~Traded~~investment ~~Portfolio~~adviser, which may be funded by or economically related ~~Companies~~to the investment advisory fees paid by us to the investment adviser under to the Investment Advisory and Administrative Services Agreement.

~~Our~~The ~~primary~~base ~~source of investment return~~management ~~will~~fee be(the ~~generated~~“Base ~~from~~Fee”) ~~net~~is ~~capital~~calculated ~~gains~~at ~~realized~~an onannual ~~the~~rate ~~disposition~~of 2% of our ~~portfolio~~gross ~~company investments~~assets, ~~which~~where ~~typically~~gross ~~will occur~~assets ~~after~~include aany ~~portfolio~~borrowings for ~~company~~investment ~~completes a share trading registration~~purposes. WeThe ~~are~~Base ~~also~~Fee ~~typically~~is ~~prohibited~~payable ~~from~~monthly ~~exiting investments~~ in ~~our~~arrears, ~~publicly~~and ~~traded~~is ~~portfolio~~calculated ~~company~~based ~~until~~on the ~~expiration~~value of ~~the~~our ~~customary~~gross ~~post-public~~assets ~~lockup agreement. These agreements,~~at ~~which~~the weend ~~are~~of ~~required~~the tomost ~~enter~~recently ~~into~~completed ascalendar ~~part of our initial investment~~quarter, ~~prohibit us~~ and ~~other~~appropriately ~~significant~~adjusted ~~existing~~for ~~investors~~any ~~from selling~~equity ~~stock~~capital inraises ~~the portfolio company~~ or ~~hedging such securities~~ repurchases during the ~~customary~~current ~~180~~calendar ~~days following an effective registration~~quarter.

~~Also,~~The ~~the~~incentive ~~market~~fee ~~prices~~is payable in arrears as of ~~portfolio~~the ~~companies~~end ~~that~~of ~~have~~each ~~recently~~calendar ~~completed~~year aand ~~trading~~equals ~~registration~~20% ~~typically~~of ~~experience~~our ~~high~~realized ~~volatility~~capital ~~and~~gains, ~~are driven~~if byany, ~~such~~on ~~factors~~a ascumulative basis ~~overall~~from ~~market~~inception ~~conditions,~~through the ~~industry~~end ~~conditions~~of ~~for~~each ~~the~~calendar ~~particular~~year, ~~sector~~computed innet ~~which~~of ~~the~~all ~~portfolio~~realized ~~company~~capital losses and unrealized capital ~~operates,~~depreciation ~~the~~on ~~portfolio~~a ~~company’s~~cumulative ~~performance~~basis, less the ~~relative~~aggregate ~~size~~amount of any previously paid incentive fees. For purposes of determining the ~~public~~incentive ~~float~~fee to be paid, realized capital gains, realized capital losses and ~~the~~unrealized ~~potential~~capital ~~selling~~depreciation ~~activities~~are each determined ofwithout ~~other~~regard ~~pre~~to the holding period for our investments and include both long-~~registration~~term ~~investors~~(held more than 12 months) and ~~possibly~~short-term ~~management~~holdings.

~~Following~~Pursuant to the Investment ~~lockup~~Advisory ~~period~~and Administrative Services Agreement, weOur ~~may~~Adviser ~~be forced~~will toalso ~~compete~~furnish us with ~~other~~equipment ~~selling~~and ~~stockholders~~clerical, ~~for~~bookkeeping and arecord-keeping ~~limited~~services. ~~availability~~Under ofthe ~~liquidity~~Investment inAdvisory ~~our~~and ~~publicly~~Administrative ~~traded~~Services ~~portfolio~~Agreement, ~~companies~~our Adviser will performs, or ~~which~~facilitates ~~volume~~the ~~may~~performance beof, ~~inadequate~~certain administrative services, ~~and~~which ~~could~~include ~~result~~being inresponsible ~~significant~~for ~~market~~the ~~price~~financial ~~volatility~~records which we are required to maintain and apreparing ~~decline~~reports into our stockholders and reports filed with the ~~value~~SEC. ofIn addition, our ~~investment.~~Adviser Inshall ~~such~~assist ~~cases~~us in monitoring our portfolio accounting and bookkeeping, ~~the~~managing portfolio collections and reporting, performing internal audit services, determining and publishing our net asset value, overseeing the preparation and filing of our ~~investments~~tax ~~may~~returns and ~~decline~~the ~~substantially~~printing orand wedissemination ~~may~~of bereports ~~forced~~ to ~~hold~~ our ~~positions~~stockholders, providing support for ~~longer~~our ~~than~~risk management efforts and generally weoverseeing ~~anticipated,~~the orpayment ~~both~~of our expenses and the performance of administrative and professional services rendered to us by others.

For our portfolio company investments where the lockup period has expired and the stock becomes freely tradable, we may not begin selling automatically upon expiration of the lockup period. We expect to sell our positions over a period of time, typically during the 12 months following the expiration of our lockup, although we may sell more rapidly or slowly in one or more block transactions. Factors that we may consider include, but are not limited to, the following:26

~~The~~We ~~target~~shall ~~price~~reimburse our ~~determined~~Adviser byfor our ~~investment adviser~~allocable ~~based~~portion onof overhead and other expenses incurred by it in performing its ~~business~~administrative ~~judgment~~obligations under the Investment Advisory and ~~what~~Administrative itServices ~~believes~~Agreement, toincluding beour allocable portion of the ~~portfolio~~compensation ~~company’s~~of ~~intrinsic~~our Chief ~~value~~Financial Officer and Chief Compliance Officer, and their respective staff.

~~The~~Our ~~application~~primary operating expenses include the payment of: ~~public~~(i) ~~company~~investment ~~multiples~~advisory fees to our investment adviser, (ii) our allocable portion of overhead and other expenses incurred by our ~~proprietary~~Adviser, ~~analysis~~as toour aadministrator, ~~variety~~in ofperforming its administrative obligations under the Investment Advisory and Administrative Services Agreement, and (iii) other operating ~~metrics~~expenses which we have detailed under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” below. Our investment advisory fee compensates our investment adviser for ~~each~~its ~~portfolio~~work ~~company~~in identifying, evaluating, negotiating, closing, monitoring and servicing our investments. We bear all other expenses of our operations and transactions.

~~The~~We ~~primary~~believe ~~operating~~the ~~metrics~~investment advisory fees that we shall pay our Adviser fairly compensates it for the specialized knowledge that its principals and investment ~~typically~~professionals ~~consider~~have ~~are~~in ~~revenue~~managing our specialized pool of private and public equity investments. Specifically, ~~EBITDA~~we believe our investment adviser has a superior origination platform and ~~net~~approach ~~income~~based on company-provided information and access to company management, a unique understanding of the financial markets and the underwriting of risks associated with investing, and a structured portfolio monitoring process to evaluate our specific portfolio companies and ensure the integrity and reliability of our Board of Directors’ determination of the fair value of our portfolio company investments.

~~Other~~Our ~~factors~~amended ~~that~~and restated ~~may~~Investment beAdvisory ~~adversely~~and ~~or favorably~~Administrative ~~affecting~~Services aAgreement, ~~particular~~which ~~portfolio~~shall ~~company’s~~be ~~stock~~in ~~price~~effect, will be approved by our Board of Directors (including ~~overall~~the ~~market~~non-interested ~~conditions~~directors) and by our stockholders with the retention of our new external Adviser. The new Investment Advisory and Administrative Services Agreement will remain in effect from year to year thereafter if approved annually by (i) the vote of our Board of Directors, ~~industry~~by ~~cyclicality~~the vote of a majority of our outstanding voting securities and a majority of our preferred shareholders, and (ii) the vote of a majority of our directors who are not interested persons. An affirmative vote of orthe ~~issues~~holders ~~specific~~of a majority of our outstanding voting securities and a majority preferred shareholder is also necessary in order to make material amendments to the ~~portfolio~~current ~~company~~Investment Advisory and Administrative Services Agreement.

~~While~~The weInvestment doAdvisory and ~~not~~Administrative ~~intend~~Services toAgreement ~~purchase~~will ~~stock~~ automatically terminate in athe ~~portfolio~~event ~~company’s~~of ~~initial~~its ~~offering~~assignment. orAs inrequired ~~open~~by ~~market~~the ~~transactions~~1940 ~~thereafter~~Act, the ~~under~~Investment ~~certain~~Advisory ~~circumstances,~~and Administrative Services Agreement provide that we may terminate the agreement without penalty upon ~~consider~~60 ~~making~~days ~~additional~~written ~~investments~~notice into our Advisor. Such written notice or any request by the external Adviser for shareholders contact information shall include a ~~publicly~~complete ~~traded~~list ~~portfolio~~of ~~company~~BDC inshareholder ~~open~~including ~~market~~their ~~purchases,~~addresses ~~which~~and ~~will~~all ~~increase~~other contact information known to our BDC and ~~position~~provided into the ~~company.~~Adviser ~~However,~~with weseven ~~may~~days beat ~~unable~~the toour ~~make~~BDCs ~~follow-on~~expense. ~~investments~~If in our ~~publicly~~Adviser ~~traded~~wishes ~~portfolio~~to ~~companies~~voluntarily asterminate the Investment aAdvisory ~~result~~and ofAdministrative ~~certain~~Services ~~regulatory~~Agreement, ~~restrictions~~it onmust give stockholders a ~~business~~minimum ~~development~~of ~~company~~120 days’s ~~investments~~notice inprior ~~publicly~~to ~~traded securities~~termination. ~~with~~The ~~market~~Investment ~~capitalizations~~Advisory inand ~~excess~~Administrative Services Agreement may also be terminated, without penalty, upon the vote of ~~$250~~a ~~million~~majority of our outstanding voting securities and preferred shareholders.

~~Because~~In ~~the~~addition, ~~portfolio company securities~~should ~~that~~ we ~~acquire are typically illiquid until a public trading registration~~ or ~~sale~~our ofAdviser ~~the~~elect ~~company,~~to weterminate ~~generally cannot predict~~ the ~~regularity~~Investment ~~and~~Advisory ~~time periods between dispositions of our portfolio company investments~~ and ~~the~~Administrative ~~realizations~~Services ~~of capital gains~~Agreement, if ~~any,~~a ~~from~~new ~~such~~investment ~~dispositions.~~adviser ~~Dispositions of our portfolio company investments are discretionary and based on our business judgment. Since we~~ may not ~~generate current income from our portfolio company investments, our operating expenses and any dividend to our shareholders will~~ be ~~financed~~appointed ~~from~~without ~~our~~approval ~~capital~~of ~~base~~a ~~during~~majority ~~periods~~ of ~~time~~our ~~between~~outstanding ~~realizations~~common ofstock ~~capital~~and ~~gains~~preferred onstock ~~our investments. In addition~~shareholders, ifexcept ~~we are successful~~ in ~~disposing~~limited circumstances ofwhere a ~~portfolio~~temporary ~~company~~adviser ~~investment, we~~ may ~~reinvest~~be ~~the~~appointed ~~principal~~without ~~amount~~stockholder ~~of our investment in new portfolio company opportunities~~consent, consistent with ~~any~~the ~~gain~~1940 ~~that we may realize being distributed to our stockholders after we pay any incentive fees earned by our investment adviser and our operating expenses~~Act.

2027

~~The~~License trading platforms of private secondary marketplaces have also emerged as an alternative to traditional public equity exchanges to provide liquidity principally to the stockholders of venture capital-backed, private companies. While these trading platforms have more limited transaction volume than public exchanges, they may provide us with access to potential purchasers interested in privately acquiring our positions in our portfolio companies that are unable to dispose of within our targeted time frame.Agreement

~~Due~~We tohave ~~the~~entered into ~~nature~~a oflicense ~~our~~agreement ~~corporate~~(“License ~~structure, we~~Agreement”) ~~believe~~with ~~that~~George weMorris ~~can~~pursuant beto awhich ~~patient~~George ~~investor~~Morris, in our ~~portfolio~~President ~~companies~~granted us ~~allowing~~a ~~them~~non-exclusive ~~flexibility~~license to ~~access~~use ~~what~~the ~~may~~name be“Dr ~~shorter and~~George ~~more~~Morris.” ~~unpredictable~~Under ~~share~~the ~~trading~~License ~~registration options~~Agreement, ~~when~~we ~~the~~will ~~timing~~have ~~and~~a ~~pricing~~right ~~may~~to use ~~be best for~~ the ~~company~~Dr ~~and~~George ~~us.~~Morris’ Inname, ~~the event~~for ofso along ~~prolonged~~as ~~closure~~Dr ofGeorge ~~the~~Morris ~~new~~or ~~share~~one ~~issue~~of ~~public~~its ~~trading~~affiliates ~~markets,~~remains ~~we can be flexible as~~ our ~~portfolio~~investment ~~companies wait~~adviser. ~~for~~Other athan ~~market~~with ~~recovery~~respect orto ~~seek~~this ~~alternative~~limited ~~exist~~license, ~~strategies.~~we ~~Since~~will wehave ~~are~~no ~~not~~legal ~~subject~~right to ~~requirements~~the to“Dr ~~return~~George ~~invested~~Morris” ~~capital to~~name ~~investors,~~or welogo. The ~~typically~~License ~~are~~Agreement ~~not~~will ~~forced~~remain toin ~~seek~~effect afor ~~liquidity~~so ~~event~~long ~~more~~as ~~quickly~~the ~~than~~Investment ~~they~~Advisory ~~otherwise~~and ~~might,~~Administrative ~~which~~Services ~~can~~Agreement ~~result~~with inour ainvestment ~~lower~~adviser ~~overall~~are ~~return~~in ~~on an investment~~effect.

~~Competition~~Regulation as a BDC

AAlthough ~~large~~the ~~number~~1940 Act ofexempts ~~entities~~a ~~compete~~BDC ~~with us~~from toregistration ~~make~~under ~~the~~that ~~types~~Act, ofit ~~investments~~contains ~~that~~significant welimitations ~~target~~on asthe ~~part~~operations of ~~our business strategy~~BDC’s. ~~We compete for such investments with a large~~Among ~~number~~other ofthings, ~~venture~~the ~~capital~~1940 ~~funds,~~Act ~~other~~contains ~~equity~~prohibitions and ~~non-equity~~restrictions ~~based~~relating ~~investment~~to ~~funds~~transactions ~~such~~between asa ~~business~~BDC ~~development~~and ~~companies~~its affiliates, ~~investment~~principal ~~banks~~underwriters and ~~other~~affiliates ~~sources~~ of ~~financing,~~its ~~including~~affiliates ~~traditional~~or ~~financial~~underwriters, ~~services~~and ~~companies~~it ~~such~~requires asthat ~~commercial~~a ~~banks~~majority ~~and~~of ~~specialty finance~~the ~~companies.~~BDC’s ~~Many~~directors ofbe persons ~~our~~other ~~competitors~~than ~~are~~“interested ~~substantially~~persons,” ~~larger~~as ~~than~~defined usunder ~~and~~the ~~have~~1940 ~~considerably~~Act. ~~greater~~The ~~financial,~~1940 ~~technical and~~Act ~~marketing~~also ~~resources~~prohibits ~~than~~a weBDC ~~do.~~from Inchanging the ~~addition,~~nature ~~some~~ of ~~our~~its ~~competitors~~business ~~may~~so ~~require~~as ~~less~~to ~~information~~cease ~~than~~to webe, ~~do and/~~or ~~have~~to ~~higher risk~~withdraw ~~tolerances~~its orelection ~~different risk assessments~~as, ~~which~~a ~~could~~BDC ~~allow~~unless ~~them~~so toauthorized ~~consider~~by athe ~~wider~~vote ~~variety~~ of ~~investments and establish~~the ~~more~~holders ~~relationships~~of ~~than~~a wemajority ~~can.~~of ~~Furthermore,~~its ~~many~~outstanding ofvoting ~~our~~securities. ~~competitors~~BDC’s are not ~~subject~~required to ~~the~~maintain ~~regulatory~~fundamental ~~restrictions~~investment ~~that the 1940~~policies ~~Act~~relating ~~imposes~~to ondiversification usand asconcentration aof ~~business~~investments ~~development~~within ~~company and, as~~ a ~~result,~~single ~~such companies may be more successful in completing their investments~~industry.

~~There~~Generally, ~~can~~a BDC must be noprimarily ~~assurance~~engaged ~~that~~in the ~~competitive pressures~~business weof ~~face~~providing ~~will~~capital and managerial expertise to companies that do not have aready ~~material~~access to ~~adverse~~capital ~~effect~~through onconventional ~~our~~financial ~~business,~~channels. ~~financial~~Such ~~condition,~~portfolio ~~and~~companies ~~results~~are oftermed ~~operations~~“eligible portfolio companies.” More ~~Also~~specifically, in order to qualify as a ~~result~~BDC, a company must (1) be a domestic company; (2) have registered a class of ~~this~~its ~~competition,~~equity securities weor ~~may~~have ~~not~~filed bea ~~able~~registration statement with the Securities and Exchange Commission pursuant to ~~take~~Section ~~advantage~~12 of ~~attractive~~the ~~investment~~Securities Exchange ~~opportunities~~Act ~~from~~of ~~time~~1934; to(3) ~~time~~operate for the purpose of investing in the securities of certain types of portfolio companies, namely immature or emerging companies and webusinesses ~~can~~suffering ~~offer~~or nojust ~~assurance~~recovering ~~that~~from wefinancial ~~will~~distress; be(4) ~~able~~extend significant managerial assistance to ~~identify~~such portfolio companies; and ~~make~~(5) ~~investments~~have ~~that~~a ~~are~~majority ~~consistent~~of ~~with~~“disinterested” ~~our~~directors ~~investment~~(as ~~objective~~defined in the 1940 Act).

~~Investment~~An ~~Advisory~~eligible portfolio company (“EPC”) is, generally, a U.S. company that is not an investment company and ~~Administrative~~that ~~Services~~(1) ~~Agreements~~does not have a class of securities registered on an exchange or included in the Federal Reserve Board’s over-the-counter margin list; or (2) is actively controlled by a BDC and has an affiliate of a BDC on its board of directors; or (3) meets such other criteria as may be established by the Securities and Exchange Commission. Control under the 1940 Act is generally presumed to exist where a BDC owns 25% of the outstanding voting securities of the company.

~~ADVISORY~~The ~~AGREEMENT~~1940 Act prohibits or restricts companies subject to the 1940 Act from investing in certain types of companies, such as brokerage firms, insurance companies, investment banking firms and investment companies. Moreover, the 1940 Act limits the type of assets that BDC’s may acquire to “qualifying assets” and certain assets necessary for its operations (such as office furniture, equipment and facilities) if, at the time of acquisition, less than 70% of the value of the BDC’s assets consist of qualifying assets. Qualifying assets include: (1) securities of companies that were eligible portfolio companies at the time the BDC acquired their securities; (2) securities of bankrupt or insolvent companies that were eligible at the time of the BDC’s initial acquisition of their securities but are no longer eligible, provided that the BDC has maintained a substantial portion of its initial investment in those companies; (3) securities received in exchange for or distributed in or with respect to any of the foregoing; and (4) cash items, government securities and high-quality short-term debt. The 1940 Act also places restrictions on the nature of the transactions in which, and the persons from whom, securities can be purchased in order for the securities to be considered qualifying assets. These restrictions include limiting purchases to transactions not involving a public offering and acquiring securities from the portfolio company or its officers, directors, or affiliates.

We are internally managed presently by our Investment Committee and Board of Directors until such time within in approximately 12 to 24 months, our Board of Director may select an external Adviser. Our future external investment advisor could be (“Morris Advisement”) or another licensed adviser company selected by our Board of Directors.28

ItA BDC is ~~expected~~permitted to invest in the securities of public companies and other investments that ~~our~~are ~~external~~not ~~Advisor elected~~qualifying byassets, ~~our~~but ~~Board~~those ~~will~~kinds beof ~~registered~~investments may ~~with~~not ~~the~~exceed ~~SEC~~30% ~~and/or~~of bythe ~~State~~BDC’s ~~regulation~~total ~~according~~asset tovalue at the ~~current~~time ~~law~~of the investment.

AsA anBDC ~~investment~~must ~~adviser~~make significant ~~under~~managerial ~~the~~assistance ~~Advisers Act,~~available ~~although~~to wethe ~~are~~issuers ~~not~~of ~~aware~~eligible ofportfolio ~~any~~securities ~~current~~in ~~plans~~which ~~for~~it ~~our~~invests. ~~Investment~~Making ~~Adviser~~available significant tomanagerial doassistance someans, ~~our~~among ~~Adviser~~other ~~may~~things, ~~also~~any inarrangement whereby the ~~future~~BDC, ~~provide similar~~through ~~investment~~its ~~advisory~~directors, ~~services~~officers toor employees, ~~other~~offers ~~entities~~to inprovide, ~~addition~~and, toif usaccepted ~~including~~does ~~other~~provide, ~~BDCs.~~significant Inguidance ~~the~~and ~~event~~counsel ~~that~~concerning ~~our~~the ~~Advisor~~management, ~~provides~~operations ~~investment~~or ~~advisory~~business ~~services~~objectives toand ~~other~~policies ~~entities,~~of ~~our~~a ~~Adviser~~portfolio ~~intends~~company. toThe ~~allocate~~portfolio ~~investment~~company ~~opportunities~~does innot ahave ~~fair,~~to ~~logical~~accept ~~and equitable~~the ~~manner~~BDC’s asoffer of itmanagerial ~~solely~~assistance, ~~determines~~and ~~pursuant~~if tothey ~~its~~do ~~allocation~~accept ~~policies~~may ~~and~~be ~~procedures~~required ~~and~~to inpay ~~any~~prevailing ~~event~~market ~~consistent~~rates ~~with~~for the ~~fiduciary~~ ~~duties owed to us~~services.

21We do not currently have any subsidiaries or EPC’s, however we do hold shares of “LPPI” granted to us for consulting services. We are actively seeking quality eligible portfolio companies in which to make an investment and provide managerial assistance.

~~Subject~~Three toMonths ~~the~~ended ~~overall~~June ~~supervision~~30, of2013 ~~our~~compared ~~Board of Directors, our Adviser shall manage our day-~~to~~-day~~ ~~investment operations and provides us with needed investment advisory services. Under~~ the ~~terms~~Three ofMonths ~~the~~ended ~~Investment~~June ~~Advisory Agreement~~30, as2012 ~~shall~~and beJune ~~in effect~~30, ~~our adviser Investments:~~2009

~~Determines~~Results ~~the composition~~ of ~~our~~Operations ~~portfolio, the nature and timing of the changes to our portfolio and the manner of implementing such changes;~~(unaudited)

~~Determines which securities we will purchase, retain or sell;~~Introduction

~~Identifies, evaluates and negotiates~~The ~~the~~Company ~~structure~~began ofexploring ~~the~~opportunities ~~investments~~for webusiness ~~make;~~development ~~and~~activities. ~~closes~~Revenue ~~monitors~~has ~~and~~been ~~services~~generated ~~the~~from ~~investments~~related ~~we make~~consulting.

~~Our~~Revenues ~~external Adviser’s services under the Investment Advisory Agreement will not be exclusive to us~~ and ~~the~~Income ~~adviser~~(Loss) isfrom free to furnish similar services to other entities so long as its services to us are not impaired. Further, our investment Adviser, its principals, investment professionals and the members of its Investment Committee may serve as investment advisers, officers, directors or principals of entities or investment funds that operate in the same or a related line of business as us and/or of investment funds managed by our affiliates.Operations

WeOur ~~pay~~revenue, ~~our Advisor a fee for its investment~~cost ~~advisory services under the Investment Advisory Agreement consisting~~ of ~~two~~revenue, ~~components~~total –operating aexpenses ~~base management fee~~ and anincome ~~incentive fee.~~(loss) ~~The~~from ~~cost~~operations offor ~~both~~ the ~~base~~three ~~management~~months ~~fee~~ended ~~payable~~June to30, ~~our Adviser and any incentive fees earned by our Adviser is ultimately borne by our common stockholders. However~~2013, ~~the principals and officers of the investment adviser who also serve~~ as ~~the~~compared ~~Company’s~~to ~~officers~~the ~~receive~~three ~~compensation~~months ~~from,~~ended orJune ~~may have financial interests in~~30, ~~the~~2012 ~~investment~~are ~~adviser,~~as ~~which may be funded by or economically related to the investment advisory fees paid by us to the investment adviser under to the Investment Advisory Agreement.~~follows:

The base management fee (the “Base Fee”) is calculated at an annual rate of 2% of our gross assets, where gross assets also include any borrowings for investment purposes. The Base Fee is payable monthly in arrears, and is calculated based on the value of our gross assets at the end of the most recently completed calendar quarter, and appropriately adjusted for any equity capital raises or repurchases during the current calendar quarter.

	3 Months Ended June 30, 2013			3 Months Ended June 30, 2012			Percentage Change Increase (Decrease)			For the Period from Inception (April 1, 2012) through June 30, 2013
Revenue	$	3,000		$	-			100.0	%	$	18,250
Cost of revenue		-			-			(0.0	)%		-
Total general and administrative expenses		3,173			1,935			64.0	%		26,423

Loss from operations	$	(173	)	$	(1,935	)		(64.8	)%	$	(8,173	)

~~The~~Our ~~incentive~~revenues ~~fee is payable in arrears~~for ~~as of~~ the ~~end~~three ofmonths ~~each~~ended ~~calendar~~June ~~year~~30, ~~and~~2013 ~~equals~~increased ~~20%~~to ~~of our realized capital gains~~$3,000 ifcompared ~~any,~~to on$0 afor ~~cumulative basis from inception through~~ the ~~end~~three ofmonths ~~each~~ended ~~calendar~~June ~~year~~30, ~~computed~~2012 ~~net of all realized capital losses~~ and ~~unrealized capital depreciation on a cumulative basis~~$18,250 ~~less~~ for the ~~aggregate~~fifteen ~~amount~~months ofended ~~any~~June ~~previously~~30, ~~paid incentive fees~~2013. ~~For~~This ~~purposes~~change ofin ~~determining~~revenues ~~the~~was ~~incentive~~a ~~fee~~result toof ~~be paid, realized capital gains, realized capital losses and unrealized capital depreciation are each determined without regard to~~ the ~~holding period~~new activity for our ~~investments~~business ~~and~~development ~~include both long-term (held more than 12 months) and short-term holdings~~consulting services.

~~ADMINISTRATIVE SERVICES AGREEMENT~~29

~~Pursuant~~Our togeneral ~~the Administrative Services Agreement, our Administrator, who may also be our Advisor. Both our Advisor~~ and ~~Administrator may, but not~~ ~~necessarily~~administrative ~~furnish~~expenses usincreased ~~with~~by ~~equipment and clerical, bookkeeping and record-keeping services~~64.0% ~~Under~~to ~~the Administrative Services Agreement~~$3,173 ~~our~~for ~~Administrator facilitates~~ the ~~performance~~three ofmonths ~~certain~~ended ~~administrative~~June ~~services~~30, ~~which~~2013 ~~includes~~compared ~~with Advisor~~to ~~assistance~~$1,935 ~~being~~for ~~retention of~~ the ~~financial records which we are required to maintain and preparing reports to our~~three ~~stockholders~~months ~~and~~ended ~~reports~~June ~~filed with the SEC. In addition~~30, ~~our~~2012 ~~Administrator shall assist us in monitoring our portfolio accounting~~ and ~~bookkeeping~~$26,423 managing portfolio collections and reporting, performing internal audit services, determining and publishing our net asset value as calculated and provided from the Advisor, overseeing the Certified Public Accountants in preparation and filing of our tax returns and the printing and dissemination of reports to our stockholders, providing support for ~~our risk management efforts and generally overseeing~~ the ~~payment~~fifteen ofmonths ~~our~~ended ~~expenses~~June and the performance of administrative and professional services rendered to us by others. The Administrator will not directly create or produce the work necessary for the above but will retain and supervise at the sole discretion of the Administrator and at the Fund expense30, ~~the necessary licensed or non-licensed professional as independent contractors to the Fund~~2013.

22As a result of the above, our loss from operations for the three months ended June 30, 2013 was $173, compared to a loss of $1,935 for the three months ended June 30, 2012, and a loss of $8,173 for the fifteen months ended June 30, 2013.

~~The~~Other ~~BDC~~Comprehensive ~~Fund~~Loss ~~shall reimburse our Adviser~~ and ~~Administrator for our allocable portion of overhead and other expenses incurred by it/them performing advisory and administrative~~Net ~~obligations~~Income under the Investment Advisory and Administrative Services Agreements. The Advisor and Administrator shall credit the Fund for our allocable portion of the compensation of our Chief Financial Officer and Chief Compliance Officer, and their respective staff used by the Advisor and Administrator working on Fund business. The fees paid to the Administrator for the administrative supervision services shall be computed as 20% of the Advisory fee amount paid but no less than $60,000 annually, on a five year $300,000 contract basis or shorter for the life of the Fund. Some or all of these supervision fees shall be paid by our Fund and/or may be deducted from the 2% fees due to the Advisor... The Administrative contract shall be automatically renewable at the option of the Administrator and/or assignable to a competent substitute selected exclusively by the Administrator.(Loss)

Our ~~primary~~other ~~operating expenses include~~comprehensive ~~the~~income ~~payment of:~~ (Iloss) ~~investment advisory fees to our investment adviser, (ii) our administrator fees~~ and ~~allocable~~net ~~portion~~income ~~of overhead and other expenses incurred by our Administrator, in performing its administrative obligations under the both the Administrative Services Agreement, and~~ (~~iii~~loss) other operating expenses which we have detailed under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” below. Our investment advisory fee compensates our investment adviser for ~~its~~the ~~work~~three inmonths ~~identifying,~~ended ~~evaluating,~~June ~~negotiating~~30, ~~closing~~2013, ~~monitoring~~as ~~and~~compared ~~servicing~~to ~~our~~the ~~investments.~~three Wemonths ~~bear~~ended ~~all~~June ~~other~~30, ~~expenses~~2012 ~~of our operations~~ and ~~transactions.~~fifteen ~~Our~~months ~~Fund~~ended ~~Administrator~~June ~~fee~~30, ~~compensates~~2013 ~~our~~are ~~administrator~~as ~~for its work in supervising the maintenance of sub-contractors for their Fund maintenance to support the legal operation and compliance of the Fund.~~follows:

We believe the investment advisory fees that we shall pay our Adviser fairly compensates it for the specialized knowledge that its principals and investment professionals have in managing our specialized pool of private and public equity investments. Specifically, we believe our investment adviser has a superior origination platform and approach based on company-provided information and access to company management, a unique understanding of the financial markets and the underwriting of risks associated with investing, and a structured portfolio monitoring process to evaluate our specific portfolio companies and ensure the integrity and reliability of our Board of Directors’ determination of the fair value of our portfolio company investments.

	3 Months Ended June 30, 2013			3 Months Ended June 30, 2012			Percentage Change Increase (Decrease)			15 Months Ended June 30, 2013
Net loss	$	(173	)	$	(1,935	)		(91.1	)%	$	(8,173	)
Other comprehensive income (loss)		-		$	(6,250	)		(100	)%	$	(12,500	)
Comprehensive loss	$	(173	)	$	(8,185	)		97.9	%	$	(20,673	)

WeLiquidity believe the investment administrator fees that we shall pay our Administrator fairly compensates it for the specialized knowledge in fund supervision maintenance for the operation of a 1940’s Act Business Development Company, (“BDC”), including the compliance and ~~reporting~~Capital requirements necessary. Further, the support of the Administrator to the Board of Directors of the BDC helps Board awareness and advises future challenges with changing government regulations and compliance from government regulators, along with the Fund’s legal counsel.Resources

~~The Advisor is not responsible for the compliance of the Fund and the Board maintains the sole responsibility for timely and appropriate action for the Fund.~~Introduction

~~The~~During ~~BDC~~the ~~Advisor and~~three ~~Administrator~~months ~~shall~~ended ~~each~~June be30, ~~approved~~2013, bywe had a ~~separate~~negative ~~majority~~cash ~~vote~~flow ~~of both common and preferred shareholders for their respective appointment and/or retention. Any Investment Advisory Agreements will remain in effect~~ from ~~year~~operating toactivities ~~year thereafter if approved annually by (i) the vote~~ of ~~our independent Board of Directors~~$1,023 ~~by the vote of a majority of both our outstanding voting securities~~ and a$0 ~~majority~~cash offlow ~~our~~from ~~preferred~~financing ~~shareholders~~activities. ~~Our Investment Advisory and Administrative~~ ~~Supervision~~We ~~Agreements,~~anticipate ~~which~~these ~~shall~~numbers bewill ~~in effect, shall be approved by our non-interested Board of Directors~~improve. And by affirmative vote separately of the holders of a majority of our outstanding voting securities and a majority preferred shareholder in order to maintain and/or make material amendments to the current Investment Advisory and Administrative Services Agreement.

~~The~~Our ~~Investment~~cash, ~~Advisory Agreement will~~accounts ~~automatically~~receivable, ~~terminate~~marketable ~~in the event of its assignment. As required by the 1940 Act~~securities, ~~the~~total ~~Investment~~assets ~~Advisory~~and ~~Agreement~~total ~~provides that~~liabilities weas may terminate the agreement without penalty upon 60 days written notice to our Advisor. Such written notice or any request by the external Adviser for shareholders contact information shall include a complete list of ~~BDC~~June ~~shareholder~~30, ~~including~~2013, ~~their~~compared ~~addresses and all other contact information known~~ to ~~our~~March ~~BDC~~31, ~~and~~2013, ~~provided~~are toas ~~the Adviser with seven days at the our BDCs expense.~~follows:

If our Adviser wishes to voluntarily terminate the Investment Advisory and Administrative Services Agreement, it must give stockholders a minimum of 120 days’ notice prior to termination. The Investment Advisory may also be terminated, without penalty, upon the vote of both separate majority of our outstanding voting securities and preferred shareholders.

	June 30, 2013		March 30, 2013
	(unaudited)
Cash	$	2,683	$	3,706
Accounts receivable	$	4,000	$	3,000
Total assets	$	6,683	$	6,706

Total liabilities	$	4,320	$	4,170

2330

~~The~~Cash Administrative Services Agreement may be assigned by the Administrator with notification to the Board of Directors in the event of its assignment. If our Administrator wishes to voluntarily terminate assign the Administrative Services Agreement, it must give Board of Directors a minimum of 60 days’ notice prior to termination or assignment.Requirements

InOur ~~addition,~~cash ~~should~~requirements are weexpected orto ~~our~~remain ~~Adviser elect~~stable toover ~~terminate~~ the ~~Investment~~next ~~Advisory~~12 amonths. ~~new~~Our ~~investment~~cash ~~adviser~~is ~~may~~utilized ~~not~~primarily befor ~~appointed~~professional ~~without~~fees ~~approval~~associated ofwith being a ~~separate~~public ~~majority of~~reporting ~~both~~company ~~our outstanding common stock~~ and ~~preferred~~with ~~stock~~the ~~shareholders,~~acquisition ~~except~~of ineligible ~~limited~~portfolio ~~circumstances where a temporary adviser may be appointed without stockholder consent, consistent with the 1940 Act~~companies.

~~Regulation~~Sources asand aUses ~~BDC~~of Cash

~~Although~~Operations ~~the 1940 Act exempts a BDC from registration under that Act, it contains significant limitations on the operations of BDC’s. Among other things, the 1940 Act contains prohibitions~~ and restrictions relating to transactions between a BDC and its affiliates, principal underwriters and affiliates of its affiliates or underwriters, and it requires that a majority of the BDC’s directors be persons other than “interested persons,” as defined under the 1940 Act. The 1940 Act also prohibits a BDC from changing the nature of its business so as to cease to be, or to withdraw its election as, a BDC unless so authorized by the vote of the holders of a majority of its outstanding voting securities. BDC’s are not required to maintain fundamental investment policies relating to diversification and concentration of investments within a single industry.Financing

~~Generally,~~During ~~a BDC must be primarily engaged in~~ the ~~business of sourcing capital and managerial expertise to companies that do not have ready access to capital through conventional~~three ~~financial~~months ~~channels.~~ended ~~Such~~June ~~portfolio~~30, ~~companies are termed “eligible portfolio companies.” More specifically~~2013, inwe ~~order to~~generated ~~qualify~~negative ascash aflow ~~BDC,~~of ~~a company must (~~$1),023. beThis awas ~~domestic company; (2) have registered~~ a ~~class~~result of ~~its~~net ~~equity~~cash ~~securities~~used orin ~~have~~operating ~~filed~~activities aof ~~registration~~$1,023, ~~statement with the Securities~~ and ~~Exchange~~no ~~Commission~~cash ~~pursuant~~in tofinancing ~~Section~~activities. 12We ofanticipate ~~the~~that ~~Securities~~we ~~Exchange~~will ~~Act~~continue ofto ~~1934; (3)~~ operate ~~for~~at ~~the~~a ~~purpose~~small ofnet ~~investing~~loss ~~money~~ and ~~time in the securities of certain types of portfolio companies, namely immature~~generate ora ~~emerging~~small ~~companies~~positive ~~and~~cash ~~businesses~~flow ~~suffering or just recovering~~ from ~~financial~~the ~~distress;~~operations ~~(4)~~of ~~extend~~our ~~significant~~business ~~managerial~~services ~~assistance to~~and ~~such~~consulting ~~portfolio companies;~~ and ~~(5)~~loans ~~have~~from ~~a majority of “disinterested” directors (as defined in the 1940 Act)~~officers.

AnCritical ~~eligible~~Accounting portfolio company (“EPC”) is, generally, a U.S. company that is not an investment company and that (1) does not have a class of securities registered on an exchange or included in the Federal Reserve Board’s over-the-counter margin list; or (2) is actively controlled by a BDC and has an affiliate of a BDC on its board of directors; or (3) meets such other criteria as may be established by the Securities and Exchange Commission. Control under the 1940 Act is generally presumed to exist where a BDC owns 25% of the outstanding voting securities of the company.Policies

~~The~~Our ~~1940~~accounting ~~Act prohibits or restricts companies~~policies ~~subject~~are todescribed ~~the 1940 Act from investing~~ in ~~certain~~Note ~~types~~2 ~~of companies, such as brokerage firms, insurance companies, investment banking firms and investment companies. Moreover, the 1940 Act limits the type of assets that BDC’s may acquire~~ to ~~“qualifying assets”~~our ~~and~~condensed ~~certain~~financial ~~assets necessary for its operations (such as office furniture, equipment and facilities) if, at the time of acquisition, less than 70% of the value of the BDC’s assets consist of qualifying assets~~statements. ~~Qualifying~~The ~~assets~~following ~~include:~~describes ~~(1) securities of companies that were eligible portfolio companies at~~ the ~~time~~general ~~the~~application ~~BDC acquired their securities; (2) securities~~ of ~~bankrupt~~ oraccounting ~~insolvent companies that were eligible at the time of the BDC’s initial acquisition of their securities but are~~principles ~~no longer eligible, provided~~ that ~~the~~impact ~~BDC~~our ~~has~~condensed ~~maintained~~financial a substantial portion of its initial investment in those companies; (3) securities received in exchange for or distributed in or with respect to any of the foregoing; and (4) cash items, government securities and high-quality short-term debtstatements. The 1940 Act also places restrictions on the nature of the transactions in which, and the persons from whom, securities can be purchased in order for the securities to be considered qualifying assets. These restrictions include limiting purchases to transactions not involving a public offering and acquiring securities from the portfolio company or its officers, directors, or affiliates.

24Our results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these condensed financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to bad debt, inventories, investments, intangible assets, income taxes, financing operations, and contingencies and litigation.

AWe ~~BDC~~base isour ~~permitted~~estimates on historical experience and on various other assumptions that are believed to ~~invest~~be inreasonable under the ~~securities~~circumstances, the results of ~~public~~which ~~companies~~form ~~and~~the ~~other~~basis ~~investments~~for ~~that~~making ~~are~~judgments ~~not~~about ~~qualifying~~the ~~assets,~~carrying ~~but~~values ~~those~~of ~~kinds~~assets ofand ~~investments~~liabilities ~~may~~that are not ~~exceed~~readily ~~30% of~~apparent ~~the~~from ~~BDC’s~~other ~~total~~sources. ~~asset~~Actual ~~value~~results atmay ~~the~~differ ~~time~~from ofthese ~~the~~estimates ~~investment~~under different assumptions or conditions.

A BDC must make significant managerial assistance available to the issuers of eligible portfolio securities in which it invests. Making available significant managerial assistance means, among other things, any arrangement whereby the BDC, through its directors, officers or employees, offers to provide, and, if accepted does provide, significant guidance and counsel concerning the management, operations or business objectives and policies of a portfolio company. The portfolio company does not have to accept the BDC’s offer of managerial assistance, and if they do accept may be required to pay prevailing market rates for the services.

We do not currently have any subsidiaries or EPC’s; however we do hold shares at zero dollar value of “LPPI” granted to us for consulting services. We are actively seeking quality eligible portfolio companies in which to make an investment and provide managerial assistance.

Results of Operations

Introduction

During the three months ended June 30, 2006, we elected to become subject to certain sections of the Investment Company Act of 1940 by becoming a Business Development Company. Our consulting services continued to be our sole source of revenues for the quarter.

Revenues and Income (Loss) from Operations

Our revenue, cost of revenue, total operating expenses and income (loss) from operations for the three months ended December 31, 2012, as compared to the three months ended December 31, 2011 and 2010 are as follows:

	3 month Period Ended December 31, 2012			2011			Percentage Change Increase (Decrease)			3 Months Ended Dec. 31, 2010
Revenue	$	5,250-		$	0-			100.0		$	3,800
Cost of revenue		-			-			(0.0	)		-
Total operating expenses		(1,553	)		(3,690	)		(57.9	)%		(4,885	)
Income (loss) from operations	$	(3,697	)	$	(4,317	)		(14.4	)%	$	(1,085	)

Our revenues for the three months ended December 31, 2012 increased to $5,250 compared to $0 for the three months ended December 31, 2011 and $3,800 for the three months ended December 31, 2010. This change in revenues was a result of the new activity for our business development consulting services.

Our total operating expenses decreased by 57.91% to $1,553 for the three months ended December 31, 2011 compared to $3,690 for the three months ended December 31, 2011 and $4,885 for the three months ended December 31, 2010.

As a result of the above, our gain from operations for the three months ended December 31, 2012 was $3,697, compared to a loss of $3,690 for the three months ended December 31, 2011, and a loss of $1,085 for the three months ended December 31, 2010.

Non-Operating Income (Expense) and Net Income (Loss)

Our other income, interest expense, and net income (loss) for the three months ended December 31, 2012, as compared to the three months ended December 31, 2011 and 2009 are as follows:

	3 Months Ended 2012			3 Months Ended 2011			Percentage Change Increase (Decrease)			3 Months Ended 2010
Other income (Loss)	$	(6,250	)	$	-			-		$	-
Interest expense		(0	)		(627	)		(100.	)%		(0	)
Beneficial conversion expense		-			-			-			(0	)
Net income (loss)	$	(3,697	)	$	(4,317	)		(14.4	)%	$	(1,085	)

On September 20, 2010, the board of directors authorized George Morris, the chairman, director and officer of the Company, to convert up to $415,000 of the outstanding debt of the company to him into 6,916,667 shares of common stock at the price of $0.06 per share. The Company recorded the right of converting the debt into shares amounting to $415,000 as an expense in the accompanying financial statements as of June 30, 2009. Since George Morris did not convert his debt as of June 30, 2011, at the Board at a meeting of August 11, 2012, the independent Board of Director members again authorized and encouraged George Morris to convert at the current market price of $0.03 to reduce the debt of the Company. The decision to reduce the debt is based on the plan to seek more capital through an equity or debt raise for operations. The current principal balance of George Morris and his affiliate Apple Realty would convert into 3,333,333 shares at $0.03 per share. However, George Morris agreed to convert all of debt his based on his tax accountant advice and Morris did in fact convert his debt receivable from our Company for 5,000,000 shares at $0.02 per restricted share.

Liquidity and Capital Resources

Introduction

During the three months ended December 31, 2012, we had a negative cash flow from operating activities of $1,635 and $0 cash out-flow from financing activities. We anticipate these numbers will improve.

Our cash and cash equivalents, accounts receivable, total current assets, total current liabilities, and total liabilities as of December 31, 2012, compared to December 31, 2011 and March 31, 2012, are as follows:

Cash	$	3,791	$	154	5,426
Accounts receivable		3,000		0-	7,500
Marketable Securities		0		6,250	12,500
Total assets		6,791		12,654	25,426
Total liabilities		2,390		74,559	2,390

Cash Requirements

Introduction

During the three months ended December 31,, 2012, we had a negative cash flow from operating activities of $2,468 and $0 cash out-flow from financing activities. We anticipate these numbers will improve.

	December 31, 2012		December 31, 2011		March 31, 2012
Cash	$	7,894	$	618		5,426
Accounts receivable		750		0-		7,500
Marketable Securities		6,250		12,500		12,500
Total assets		14,894		13,118		25,426
618 Total liabilities		2,390		83,419		2,390

Cash Requirements

Our cash requirements are expected to remain stable over the next 12 months. Our cash is utilized primarily for professional fees associated with being a public, reporting company and with the acquisition of eligible portfolio companies.

Sources and Uses of Cash

Operations and Financing

During the three months ended December 31, 2012, we used a negative cash flow of $1,635. This was a result of net cash used by operating activities of $1,635, and $-0- net cash changed in financing activities. We anticipate that we will continue to operate at a small net loss and generate a small positive cash flow from the operations of our business services and consulting and loans from officers.

Critical Accounting Policies

Our accounting policies are fully described in Note 2 to our consolidated financial statements. The following describes the general application of accounting principles that impact our consolidated financial statements.

Our results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to bad debt, inventories, investments, intangible assets, income taxes, financing operations, and contingencies and litigation.

We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

Since we have very few assets and only one operating division there is no quantitative information, as of ~~December 31~~June 30, ~~2012~~ 2013, about market risk that has any impact on our present business. Once we begin making investments in additional eligible portfolio companies we anticipate there will be market risk sensitive instruments and we will disclose the applicable market risk information at that time.

Our primary financial instruments are cash in banks and money market instruments. We do not believe that these instruments are subject to material potential near-term losses in future earnings from reasonably possible near-term changes in market rates or prices. We do not have derivative financial instruments for speculative or trading purposes. We are not currently exposed to any material currency exchange risk.

ITEM 4. Controls and Procedures

Evaluation of disclosure controls and procedures. The Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective and are designed to provide reasonable assurances of achieving their objectives. Further, the Company’s officers concluded that its disclosure controls and procedures are also effective to ensure that information required to be disclosed in the reports that it files or submits under the Exchange Act is accumulated and communicated to its management, including its chief executive officer and chief financial officer, to allow timely decisions regarding required disclosure. There were no significant changes in the Company’s internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect our internal controls over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. Legal proceedings

In the ordinary course of business, we may be from time to time involved in various pending or threatened legal actions. The litigation process is inherently uncertain and it is possible that the resolution of such matters might have a material adverse effect upon our financial condition and/or results of operations. However, in the opinion of our management, matters currently pending or threatened against us are not expected to have a material adverse effect on our financial position or results of operations.

ITEM 1A. Risk Factors

At the time we filed our last Annual Report on Form 10-K, we were a Small Business Issuer as defined in Regulation S-B, and thus did not include risk factors in our filing.

ITEM 2 Unregistered Sales of Equity Securities and Use of Proceeds

~~5,000,000~~There ~~Common Shares~~ were ~~exchanged~~no unregistered ~~for~~sales ~~$100,000~~of inequity ~~debt~~securities ~~owed~~in tothe ~~our~~quarter ~~Chairman~~ended ~~George~~June ~~Morris~~30, ~~to eliminate almost all debt from our Balance Sheet~~2013.

ITEM 3 Defaults ~~upon~~Upon Senior Securities

There have been no events which are required to be reported under this Item.

ITEM 4 ~~Submissions~~Submission of Matters to a a Vote of Security Holders

There have been no events which are required to be reported under this Item.

ITEM 5 Other Information

There have been no events which are required to be reported under this Item.

ITEM 6 Exhibits

3.1 (1)		Articles of Incorporation of Electronic Media Central Corporation
3.2 (4)		Articles of Amendment to Articles of Incorporation
3.3 (1)		Bylaws
10.1 (2)		Distribution Agreement Between Electronic Media Central and L&M Media, Inc., dba Apple Media
14.1 (3)		Code of Ethics
31.1		Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer*
31.2		Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer*
32.1		Chief Executive Officer Certification Pursuant to 18 USC, Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
32.2		Chief Financial Officer Certification Pursuant to 18 USC, Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
101.INS		XBRL Instance Document**
101.SCH		XBRL Taxonomy Extension Schema Document**
101.CAL		XBRL Taxonomy Extension ~~Definition~~Calculation Linkbase Document**
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document**
101.LAB		XBRL Taxonomy Extension Label Linkbase Document**
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document**

(1)	Incorporated by reference to our Form 10-SB, Commission file number 000-32345, filed with the Commission on February 13, 2001.	~~(1)~~	~~Incorporated by reference to our Form 10-SB, Commission file number 000-32345, filed with the Commission on February 13, 2001.~~
(2)	Incorporated by reference to the Registrant’s Registration Statement on Form 10-SB/A, filed on April 13, 2001.	~~(2)~~	~~Incorporated by reference to the Registrant’s Registration Statement on Form 10-SB/A, filed on April 13, 2001.~~
(3)	Incorporated by reference to the Registrant’s Annual Report on Form 10-KSB, filed on July 13, 2004.	~~(3)~~	~~Incorporated by reference to the Registrant’s Annual Report on Form 10-KSB, filed on July 13, 2004.~~
(4)	Incorporated by reference to the Registrant’s Annual Report on Form 10-K, filed on July 3, 2007.	~~(4)~~	~~Incorporated by reference to the Registrant’s Annual Report on Form 10-K, filed on July 3, 2007.~~
*	Filed herewith.	*	~~Filed herewith~~
**	In accordance with Regulation S-T, the XBRL-formatted interactive data files that comprise Exhibit 101 in this Quarterly Report on Form 10-Q shall be deemed “furnished” and not “filed”.

2832

A signed original of this written statement required by Section 906 has been provided to Morris Business Development Company and will be retained by Morris Business Development Company and furnished to the Securities and Exchange Commission or its staff upon request.SIGNATURES

~~Our~~Pursuant ~~Management’s~~to ~~Discussion and Analysis contains not only statements that are historical facts, but also statements that are forward-looking (within~~ the ~~meaning of~~requirements ~~Section 27A~~ of the Securities ~~Act of 1933 and Section 21E of the Securities~~ Exchange Act of 1934~~). Forward-looking statements are~~, by their very nature, uncertain and risky. These risks and uncertainties include international, national and local general economic and market conditions; demographic changes; our ability to sustain, manage, or forecast growth; our ability to successfully make and integrate acquisitions; raw material costs and availability; new product development and introduction; existing government regulations and changes in, or the ~~failure~~registrant tohas ~~comply~~duly ~~with,~~caused ~~government~~this ~~regulations;~~report adverse publicity; competition; the loss of significant customers or suppliers; fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to ~~attract and retain qualified personnel; the ability to protect technology; and other risks that might~~ be ~~detailed~~signed ~~from~~on ~~time~~its tobehalf ~~time~~by ~~in our filings with~~ the ~~Securities~~undersigned ~~and~~thereunto duly ~~Exchange Commission~~authorized.

Although the forward-looking statements in this Quarterly Report reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by them. Consequently, and because forward-looking statements are inherently subject to risks and uncertainties, the actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. You are urged to carefully review and consider the various disclosures made by us in this report and in our other reports as we attempt to advise interested parties of the risks and factors that may affect our business, financial condition, and results of operations and prospects.

Dated: August 19, 2013	By:	/s/ George P Morris
	Name:	George P. Morris
	Its:	Chief Executive Officer

Dated: August 19, 2013	By:	/s/ George P Morris
	Name:	George P. Morris
	Its:	Chief Financial Officer

~~Overview~~A signed original of this written statement required by Section 906 has been provided to Morris Business Development Company and will be retained by Morris Business Development Company and furnished to the Securities and Exchange Commission or its staff upon request.

~~We focus on the development of opportunities to invest in eligible portfolio companies sourcing and/or providing early stage debt and/or equity capital, strategic guidance and operational support.~~33

Our principal objective is consulting income from clients and long-term capital appreciation holdings of their securities. We may invest in debt securities of these companies, or may acquire an equity interest in the form of common or preferred stock, warrants or options to acquire stock or the right to convert the debt securities into stock.

We may invest alone, or as part of a larger investment group. Consistent with our status as a BDC and the purposes of the regulatory framework for BDC’s under the 1940 Act, we will provide managerial assistance, potentially in the form of a consulting agreement or in the form of a board of director’s seat, to the developing companies in which we invest.

In addition, we may acquire either a minority or controlling interest in mature public or privately owned

companies in a roll-up strategy. It is anticipated that any acquisitions will be primarily in exchange for our common stock, or a combination of cash and stock. The principal objective of acquisitions pursuant to a roll-up strategy would be to consolidate an industry and either sell the acquired entities as a larger unit, or take the unit public through an initial public offering, spin-off to our shareholders, or reverse merger into a publicly traded shell corporation.

We shall operate as an internally managed investment company until such time as we are ready to select either an independent or affiliated external management company. At such time, our operations will be governed by an Investment Advisory Management Agreement to be entered into between us and a new investment advisory limited liability company which may be and probably will be formed and wholly-owned by our Chairman, George Morris. We have not elected to but plan to attempt to qualify without a guarantee of success or timing, to be taxed as a regulated investment company as defined under Subchapter M of the Internal Revenue Code.

Our common stock trades on the over the counter bulletin board under the symbol “MBDE.”

Our financial statements have been prepared assuming we will continue as a going concern by our Board of Directors. Because we have historically incurred operating losses, and expect those losses to continue in the future, our Certified Public Accountants included an explanatory paragraph in their report raising substantial doubt about our ability to continue as a going concern.

Regulation as a BDC

Although the 1940 Act exempts a BDC from registration under that Act, it contains significant limitations on the operations of BDC’s. Among other things, the 1940 Act contains prohibitions and restrictions relating to transactions between a BDC and its affiliates, principal underwriters and affiliates of its affiliates or underwriters, and it requires that a majority of the BDC’s directors be persons other than “interested persons,” as defined under the 1940 Act. The 1940 Act also prohibits a BDC from changing the nature of its business so as to cease to be, or to withdraw its election as, a BDC unless so authorized by the vote of the holders of a majority of its outstanding voting securities. BDC’s are not required to maintain fundamental investment policies relating to diversification and concentration of investments within a single industry.

Generally, a BDC must be primarily engaged in the business of furnishing capital and providing managerial expertise to companies that do not have ready access to capital through conventional financial channels. Such portfolio companies are termed “eligible portfolio companies.” More specifically, in order to qualify as a BDC, a company must (1) be a domestic company; (2) have registered a class of its equity securities or have filed a registration statement with the Securities and Exchange Commission pursuant to Section 12 of the Securities Exchange Act of 1934; (3) operate for the purpose of investing in the securities of certain types of portfolio companies, namely immature or emerging companies and businesses suffering or just recovering from financial distress; (4) extend significant managerial assistance to such portfolio companies; and (5) have a majority of “disinterested” directors (as defined in the 1940 Act).

An eligible portfolio company (“EPC”) is, generally, a U.S. company that is not an investment company and that (1) does not have a class of securities registered on an exchange or included in the Federal Reserve Board’s over-the-counter margin list; or (2) is actively controlled by a BDC and has an affiliate of a BDC on its board of directors; or (3) meets such other criteria as may be established by the Securities and Exchange Commission. Control under the 1940 Act is generally presumed to exist where a BDC owns 25% of the outstanding voting securities of the company.

The 1940 Act prohibits or restricts companies subject to the 1940 Act from investing in certain types of companies, such as brokerage firms, insurance companies, investment banking firms and investment companies. Moreover, the 1940 Act limits the type of assets that BDC’s may acquire to “qualifying assets” and certain assets necessary for its operations (such as office furniture, equipment and facilities) if, at the time of acquisition, less than 70% of the value of the BDC’s assets consist of qualifying assets. Qualifying assets include: (1) securities of companies that were eligible portfolio companies at the time the BDC acquired their securities; (2) securities of bankrupt or insolvent companies that were eligible at the time of the BDC’s initial acquisition of their securities but are no longer eligible, provided that the BDC has maintained a substantial portion of its initial investment in those companies; (3) securities received in exchange for or distributed in or with respect to any of the foregoing; and (4) cash items, government securities and high-quality short-term debt. The 1940 Act also places restrictions on the nature of the transactions in which, and the persons from whom, securities can be purchased in order for the securities to be considered qualifying assets. These restrictions include limiting purchases to transactions not involving a public offering and acquiring securities from either the portfolio company or its officers, directors, or affiliates.

A BDC is permitted to invest in the securities of public companies and other investments that are not qualifying assets, but those kinds of investments may not exceed 30% of the BDC’s total asset value at the time of the investment.

We do not currently have any subsidiaries or EPC’s, however we do hold shares of “LPPI” granted to us for consulting services but not released for free trading. We are actively seeking quality eligible portfolio companies in which to make an investment and provide managerial assistance.

Three Months ended December 31, 2012 compared to the Three Months ended December 31, 2011 and December 31, 2010

Results of Operations

Introduction

During the three months ended September 30, 2006, we elected to become subject to certain sections of the Investment Company Act of 1940 by becoming a Business Development Company. Our consulting services continued to be our sole source of revenues for the quarter.

Revenues and Income (Loss) from Operations

	3 Months Ended December 31, 2012		3 Months Ended December 31, 2011			Percentage Change Increase (Decrease)			3 Months Ended December 31, 2010
Revenue	$	5,250				$	100	%	$	3,800
Cost of revenue		—		—			0			3,800
Total operating expenses		1,553		(3,690	)		(57.9	)%		1,085
Income (loss) from operations	$	3,697	$	(4,317	)		185.6	%	$	(1,085	)

Our revenues for the three months ended December 31, 2012 increased to $5,250 compared to the three months ended December 31, 2011 of $0 and from $3,800 for the three months ended December 31, 2010. This increase in revenues was a result of the additional activity of our business development consulting services.

Our total operating expenses decreased by 14.5% to $1,553 for the three months ended December 31, 2012 compared to $3,690 for the three months ended December 31, 2011 and $1,085 for the three months ended December 31, 2010.

As a result of the above, our loss from operations for the three months ended December 31, 2012 was $3,697, compared to a loss of $3,690 for the three months ended December 31, 2011, and a loss of $1,085 for the three months ended December 31, 2010.

Non-Operating Income (Expense) and Net Income (Loss)

Our other income, interest expense, and net income (loss) for the three months ended December 31, 2012, as compared to the three months ended December 31, 2011 and 2010 are as follows:

	3 Months Ended December 31, 2012		3 Months Ended December 31, 2011			Percentage Change Increase (Decrease)			3 Months Ended December 31, 2010
Other income	$	—	$	—			—		$	—
Interest expense				627			100	%		—
		—		—			—			0
Net income (loss)	$	3,697	$	(4,317	)		(216.7	)%	$	(1,085	)

On September 20, 2010, the board of directors authorized George Morris, the chairman, director and officer of the Company, to convert up to $415,000 of the outstanding debt of the company to him into 6,916,667 shares of common stock at the price of $0.06 per share. The Company recorded the right of converting the debt into shares amounting to $415,000 as an expense in the accompanying financial statements as of December 31, 2010. Since George Morris did not convert his debt as of December 31, 2012, at the Board at a meeting of August 19, 2012, the independent Board of Director members again authorized and encouraged George Morris to convert at the current market price of $0.03 to reduce the debt of the Company. The decision to reduce the debt is based on the plan to seek more capital through an equity or debt raise for operations. The current principal balance of George Morris and his affiliate Apple Realty would convert into 11,348,133 shares at $0.03 per share. George Morris agreed to convert $100,000 debts for 5,000,000 shares on March 31, 2012...

Liquidity and Capital Resources

Introduction

During the three months ended December 31, 2012, we had a negative cash flow from operating activities of $(3,680) and $2,883 cash flow from financing activities. We anticipate these numbers will improve.

	December 31, 2012		December 31, 2011		March 31, 2012
Cash	$	3,791	$	618	$	5,426
Accounts receivable		3,000		—		7,500
Marketable Securities				12,500		12,500
Total assets		6,791		13,118		25,426
Total liabilities		2,390		83,419		2,390

Cash Requirements

Sources and Uses of Cash

Operations and Financing

During the nine months ended December 31, 2012, we generated negative cash flow of $1,635. This was a result of net cash used by operating activities of $(1,635), offset by net cash provided in financing activities of $0. We anticipate that we will continue to operate at a small net loss and generate a small positive cash flow from the operations of our business services and consulting and loans from officers.

Critical Accounting Policies

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

Since we have very few assets and only one operating division there is no quantitative information, as of December 31, 2012, about market risk that has any impact on our present business. Once we begin making investments in additional eligible portfolio companies we anticipate there will be market risk sensitive instruments and we will disclose the applicable market risk information at that time.

ITEM 4. Controls and Procedures

There were no significant changes in the Company’s internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect our internal controls over financial reporting.

SIGNATURES

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

Dated: February 19, 2013	/s/ George P. Morris
	By: George P. Morris
	Its: Chief Executive Officer
Dated: February 19, 2013	/s/ George P Morris
	By: George P. Morris
	Its: Chief Financial Officer

Dated: February 19, 2013	By:	/s/ George P. Morris
		George P. Morris
		Its: Chief Financial Officer

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