Attached files
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EX-32.1 - CERTIFICATION OF CHIEF EXECUTIVE OFFICER - WORLDVEST, INC. | f10k2009ex32i_worldvest.htm |
EX-31.1 - CERTIFICATION OF CHIEF EXECUTIVE OFFICER - WORLDVEST, INC. | f10k2009ex31i_worldvest.htm |
EX-32.2 - CERTIFICATION OF CHIEF FINANCIAL OFFICER - WORLDVEST, INC. | f10k2009ex32ii_worldvest.htm |
EX-31.2 - CERTIFICATION OF CHIEF FINANCIAL OFFICER - WORLDVEST, INC. | f10k2009ex31ii_worldvest.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
ý
|
ANNUAL
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For the
fiscal year ended: December 31,
2009
o
|
TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Commission
File No.:
000-51879
WORLDVEST, INC. | ||
(Exact name of registrant as specified in its charter) |
Florida
|
26-1095171
|
|
(State or other
jurisdiction of
incorporation or
organization)
|
(IRS Employer
Identification No.)
|
|
295 Madison Ave, 12th Floor, New York,
NY
|
10067
|
|
(Address of
principal executive offices)
|
(Zip
Code)
|
|
(310)
277-1513
(Registrant’s
telephone number, including area code)
Securities
registered under Section 12(b) of the Exchange Act: None.
|
Securities
registered under Section 12(g) of the Exchange Act:
|
Common
Stock, par value $0.001
|
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.
Yes o No ý
Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. Yes o No ý
Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes o No ý
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding
12 months (or for such shorter period that the registrant was required to submit
and post such files). Yes o No o
Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not
be contained, to the best of registrant’s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. o
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.
Large
accelerated filer
|
o
|
Accelerated
filer
|
o
|
|
Non-accelerated
filer
(Do
not check if a smaller reporting company)
|
o
|
Smaller
reporting company
|
ý
|
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act). Yes o No ý
The
aggregate market value of the registrant’s voting common stock held by
non-affiliates as of April 15, 2010, based upon the closing price reported for
such date on the OTC Bulletin Board was $22,949,977.
As of
April 15, 2010, the registrant had 59,065,317 shares of its common stock
outstanding
TABLE
OF CONTENTS
PAGE
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|||||
PART
I
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|||||
ITEM
1.
|
Business
|
3 | |||
ITEM
1A.
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Risk Factors
|
4 | |||
ITEM
1B.
|
Unresolved
Staff Comments
|
4 | |||
ITEM
2.
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Properties
|
4 | |||
ITEM
3.
|
Legal Proceedings
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4 | |||
ITEM
4.
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(Removed and Reserved)
|
4 | |||
PART
II
|
|||||
ITEM
5.
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Market for Registrant’s Common Equity, Related
Stockholder Matters and Issuer Purchases of Equity
Securities
|
5 | |||
ITEM
6.
|
Selected Financial Data
|
6 | |||
ITEM
7.
|
Management’s Discussion and Analysis of Financial
Condition and Results of Operation
|
6 | |||
ITEM
7A.
|
Quantitative and Qualitative Disclosures About
Market Risk
|
12 | |||
ITEM
8.
|
Financial Statements and Supplementary
Data
|
12 | |||
ITEM
9.
|
Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure
|
32 | |||
ITEM
9A(T).
|
Controls and Procedures
|
32 | |||
ITEM
9B.
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Other
Information
|
32 | |||
PART
III
|
|||||
ITEM
10.
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Directors, Executive Officers and Corporate
Governance
|
33 | |||
ITEM
11.
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Executive Compensation
|
36 | |||
ITEM
12.
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Security Ownership of Certain Beneficial Owners
and Management and Related Stockholder Matters
|
37 | |||
ITEM
13.
|
Certain Relationships and Related Transactions,
and Director Independence
|
37 | |||
ITEM
14.
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Principal Accounting Fees and
Services
|
38 | |||
PART
IV
|
|||||
ITEM
15.
|
Exhibits, Financial Statement
Schedules
|
39 | |||
SIGNATURES
|
2
PART
I
DESCRIPTION
OF BUSINESS
WorldVest, Inc. (“WorldVest” or the “Company”)
was organized September 17, 2007, under the laws of the state of
Florida. The Company, as a global merchant bank, offers traditional
investment banking and advisory services, while also makes direct investments as
a principal in select global transactions.
WorldVest,
Inc. (“WorldVest”) has established a simplistic and powerful global
infrastructure with the objective of sourcing and completing investment
transactions with the potential for “outsized” returns. At present,
WorldVest consists of an executive management team (“Management”) and an
experienced board of directors and advisors with substantial experience in the
areas of global investing, investment banking, trading, venture capital and
business management across a wide variety of industries in global
markets. It is Management’s responsibility to develop and manage its
subsidiary operating companies, which include WorldVest Finance Corporation (“WV
Financial”), an international banking & finance company, and WorldVest
Partners (“WV Partners”), an equity development & asset management company
charged with creating and launching a series of strategic Platform Development
Companies (“PDC”).
As a
truly global company, WorldVest pursues transactions without predefined
boundaries or limits. Rather than placing limits on its business
areas, WorldVest evaluates opportunities in all geographic markets, industries
and stages of development based on their individual merits and seeking to
participate in those which offer the greatest opportunity to create absolute
risk-adjusted returns. WorldVest’s principal objective as a global
merchant bank is to increase its shareholders’ value by investing in, acquiring,
partnering with and advising high-growth companies with an initial focus on
those located in North America and the BRIC countries (Brazil, Russia, India,
China, and secondarily South Korea), which have among the fastest growing GDPs
in the world. The combination of its highly experienced management team and its
global network of trusted advisors, associates, and affiliate relationships
enables WorldVest to access high-caliber transactions from around the
world.
Management
recognizes the disconnect that exists between the needs of high-growth companies
and the limitations of traditional investment banking, private equity, and
venture capital institutions. As a global merchant bank, WorldVest has set a new
standard, emerging as a partner and solution provider where one did not
previously exist.
WorldVest
Financial Corporation – International Banking & Advisory
Subsidiary
Over the
last few years, WorldVest has assembled, through acquisition and organic growth,
a unique group of Banking & Financial Advisory assets, each positioned for
international transaction growth. Recently, WorldVest Financial
Corporation “WV Financial” was launched as a consolidation of these global
operations into an independent International Banking & Finance subsidiary
with operations in the United States, China and Brazil and will continue to
pursue growth opportunities in the global financial services
markets.
WV
Financial will operate internationally through three divisions: (i) WorldVest,
Inc. dba WorldVest USA, a US based Corporate Finance & advisory company;
(ii) FutureVest Management (Shenyang) Co. Ltd., dba China WorldVest Group, a PRC
subsidiary with a banking & finance license which has a unique status as a
Wholly Foreign Owned Entity operating autonomously in the Peoples Republic of
China; and (iii) WorldVest Brasil, Ltda., a Brazilian finance company currently
being incorporated under the laws of the country of
Brazil.
WorldVest
Partners, LLC – Equity Development & Asset Management
Subsidiary
To
implement its direct investment objectives, WorldVest Partners, LLC is currently
being formed as a subsidiary to create a series of Platform Development
Companies (“PDCs”) that utilize a wide variety of corporate structures and
investment strategies each aimed at capitalizing on strategic equity
opportunities in the global marketplace. Each PDC will be structured
with its own unique business and operating objectives with independent growth
strategies and in each case, WorldVest Partners will act as external management
with the intent to raise equity capital through our partner network and position
each PDC for an independent public listing as an exit
strategy. Currently, WorldVest has launched its initial two PDC
companies with additional PDC transactions in
development:
3
WorldVest Korea Group –
Korean Investment & Development Company
On June
26, 2009, WorldVest signed a memorandum of understanding (“MOU”) with the Korea
Trade and Investment Promotion Agency (“KOTRA”), outlining the creation of the
WorldVest Vintage Korea Investment Initiative, which will be further developed
into a separate entity to be incorporated as WorldVest Korea Group,
LLC (“WV Korea”). With the support of KOTRA, WorldVest
seeks to strategically invest into mature high-growth South Korean companies
seeking to expand globally and list publicly on a U.S. exchange. In
addition to providing an infusion of Capital, WV Korea aims to offer these
portfolio companies the additional resources and management expertise necessary
to execute their business and growth objectives. WV Korea will have
an initial focus on high technology companies positioned to expand globally
though distribution contracts or purchase orders. Each company
acquired in this platform will have a goal to achieve independent growth while
preparing for an exit strategy within a three-year period. Possible
exit strategies will be a M&A event such as a sale, merger or an IPO of
their stock on a major exchange.
Hurricane Global Resource
Corporation – Global Resource Trading, Acquisition &
Development
On
February 19, 2010, WorldVest launched Hurricane Global Resources Corporation
(“Hurricane”) as its second PDC to serve as a global natural resource trading,
acquisition & project development company. As China has overtaken
the United States to become the number one trading partner to Brazil, it is
clear to see that the flow of global trade of commodities and natural resources
between these two countries continues to increase. Accordingly,
WorldVest Partners launched Hurricane to begin trading commodities including
such products such as iron ore, sugar and precious metals. Taking
these trading opportunities a step further, Hurricane is in preliminary talks to
acquire a slate of commodity reserve properties, which include an iron ore mine
in Brazil, a Potash mine in the United States, development rights to a Brazilian
“sustainable forestry management” project and a highly unique fish farm in
Brazil. Hurricane seeks to invest in, and consolidate, these and
future opportunities while pursuing a public listing on a major
exchange.
ITEM
1A. RISK FACTORS
Not
applicable to smaller reporting companies.
ITEM
1B. UNRESOLVED STAFF COMMENTS
Not
applicable to smaller reporting companies.
The
WorldVest principal executive office location is 295 Madison Ave, 12th
Floor, New York City, NY 10067 with additional offices in Los Angles office at
1500 Rosecrans Ave, Suite 500, Manhattan, Beach, CA, 90266. WorldVest
also has small offices in Sao Paulo, Brazil and Shenyang,
China. Currently, our NY and LA offices are sufficient to meet our
needs; however, if we expand our business to a significant degree, we will have
to find a larger space.
There are
no pending legal proceedings to which the Company is a party or in which any
director, officer or affiliate of the Company, any owner of record or
beneficially of more than 5% of any class of voting securities of the Company,
or security holder is a party adverse to the Company or has a material interest
adverse to the Company. The Company’s property is not the subject of any pending
legal proceedings.
ITEM
4. (REMOVED AND RESERVED)
4
PART
II
ITEM
5.
MARKET FOR REGISTRANTS
COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
SECURITIES
Public Market for Common
Stock
Our
common stock is listed on the OTC Bulletin Board system under the symbol “CTLV”
since January 17, 2008, and began trading under the symbol “WOVT” on July 23,
2009.
The
market price of our common stock is subject to significant fluctuations in
response to variations in our quarterly operating results, general trends in the
market, and other factors, over many of which we have little or no control. In
addition, broad market fluctuations, as well as general economic, business and
political conditions, may adversely affect the market for our common stock,
regardless of our actual or projected performance.
Quarter
ended
|
High
|
Low
|
||||||
December
31, 2009
|
$
|
2.10
|
$
|
1.40
|
||||
September
30, 2009
|
$
|
2.30
|
$
|
1.90
|
||||
June
30, 2009
|
$
|
2.05
|
$
|
0.01
|
||||
March
31, 2009
|
$
|
0.01
|
$
|
0.01
|
||||
December
31, 2008
|
$
|
0.01
|
$
|
0.01
|
||||
September
30, 2008
|
$
|
0.01
|
$
|
0.01
|
||||
June
30, 2008
|
$
|
0.01
|
$
|
0.01
|
||||
March
31, 2008
|
$
|
0.01
|
$
|
0.01
|
Holders
As of
April 15, 2010, 59,065,317 shares of the Company’s common stock were issued and
outstanding. There are approximately 66 shareholders of our common
stock and each shareholder of our common stock is entitled to one vote for each
share on all matters submitted to a stockholder vote.
Dividends
Since
inception we have not paid any dividends on our common stock. We currently do
not anticipate paying any cash dividends in the foreseeable future on our common
stock, when issued pursuant to this offering. Although we intend to retain our
earnings, if any, to finance the exploration and growth of our business, our
Board of Directors will have the discretion to declare and pay dividends in the
future.
Payment
of dividends in the future will depend upon our earnings, capital requirements,
and other factors, which our board of directors may deem relevant.
Recent Sales of Unregistered
Securities
On
December 22, 2009, the Company issued 155,843 shares of its restricted common
shares to eight (8) accredited investors in exchange for $233,760 in
cash.
We
believe the issuance of the shares is exempt from the registration and
prospectus delivery requirement of the Securities Act of 1933 by virtue of
Section 4(2) and/or Regulation D, Rule 506. The shares were issued
directly by us and did not involve a public offering or general
solicitation. The recipients of the shares were afforded an
opportunity for effective access to our files and records of that contained the
relevant information needed to make their investment decision, including our
financial statements and 34 Act reports. We reasonably believed that the
recipients had such knowledge and experience in the Company’s financial and
business matters that they were capable of evaluating the merits and risks of
his investment.
On
December 31, 2009, the Company converted $6,000,000 of the principal and
interest due under the 9% Convertible Debenture issued by WorldVest Equity, Inc.
dated June 22, 2009, into the following securities:
a.
|
Four
million (4,000,000) shares of Series B Convertible Preferred Shares
carrying a 9% interest coupon to be Paid in Kind with each share
convertible into one share of the common stock of the
Company. The shares are issued to WV55
Partners;
|
b.
|
1,000,000
Series C Non-Equity Preferred Shares that carry 100 common stock votes for
each Series C Preferred Share Issued. The shares will be issued
WV55 Partners; and
|
c.
|
All
accrued interest on the debentures through December 31, 2009, amounting to
$284,544, will be paid with WorldVest, Inc. common stock at a price of
$1.50 per share resulting in the future issuance of 189,696 common
shares.
|
5
We
believe the issuance of the shares is exempt from the registration and
prospectus delivery requirement of the Securities Act of 1933 by virtue of
Section 4(2) and/or Regulation D, Rule 506. The shares were issued
directly by us and did not involve a public offering or general
solicitation. The recipients of the shares were afforded an
opportunity for effective access to our files and records of that contained the
relevant information needed to make their investment decision, including our
financial statements and 34 Act reports. We reasonably believed that the
recipients had such knowledge and experience in the Company’s financial and
business matters that they were capable of evaluating the merits and risks of
his investment.
Equity Compensation Plan
Information
The
following table sets forth certain information as of April 15, 2010, with
respect to compensation plans under which our equity securities are authorized
for issuance:
(a)
|
(b)
|
(c)
|
|||||
_________________
|
_________________
|
_________________
|
|||||
Number
of securities to be issued upon exercise of outstanding options, warrants
and rights
|
Weighted-average
exercise price of outstanding options, warrants and rights
|
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in column
(a))
|
|||||
Equity
compensation
|
None
|
||||||
Plans
approved by
|
|||||||
Security
holders
|
|||||||
Equity
compensation
|
None
|
||||||
Plans
not approved
|
|||||||
By
security holders
|
ITEM
6. SELECTED FIANANCIAL DATA
Not
applicable because we are a smaller reporting company.
The
following discussion should be read in conjunction with the Consolidated
Financial Statements and Notes thereto appearing elsewhere in this Form 10-K.
The following discussion contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934 relating to future events or our future performance. Actual
results may materially differ from those projected in the forward-looking
statements as a result of certain risks and uncertainties set forth in this
prospectus. Although management believes that the assumptions made and
expectations reflected in the forward-looking statements are reasonable, there
is no assurance that the underlying assumptions will, in fact, prove to be
correct or that actual results will not be different from expectations expressed
in this report.
Plan of
Operations
During
the next twelve months, we seek to continue to develop our operating
subsidiaries and platform development companies with the combined goal of
maximizing both earnings per share and the net asset value of our investment
portfolio.
Within WV
Financial, we plan to complete the formation and capitalization of a Fundo de
Investimento em Diretos Creditorios (“FIDC”), a Brazilian structured credit
receivables fund investing in highly-rated short term receivables within the
retail and consumer finance sectors in Brazil. Additionally,
WorldVest seeks to acquire a multiple license Brazilian commercial and
Investment Bank, an established Brazilian financial management company and an
emerging U.S. Mortgage Bank currently licensed in California. Through
the consolidation of these assets, WV Financial will become a diversified and
far reaching global financial holding company positioned for an independent
public listing.
6
WorldVest
Partners aims to capitalize and further develop its existing two platform
development companies. Under Hurricane Global Resource Corporation,
WorldVest Partners anticipates commending brokering the trade of iron ore
between Latin America and its Chinese buyer, currently under LOI. On
the strength of this buyer, Hurricane aims to complete the acquisition of one or
more iron ore reserves to be developed into a producing mine(s), while also
pursuing additional investments in natural resource related assets.
We also
plan to raise a minimum of USD $5 million in new capital into the Company
through a Regulation D private placement offering, which we anticipate launching
in April/May of 2010. Further, we plan to launch parallel Regulation
D private placement offerings in both WV Finance and Hurricane in the coming
months in order to independently finance their ongoing focused
operations.
Limited Operating
History
We have
generated approximately two full years of financial information and have not
previously demonstrated that we will be able to expand our business through an
increased investment in our product line and/or marketing
efforts. Our business is subject to risks inherent in growing an
enterprise, including limited capital resources and possible rejection of our
new products and/or sales methods.
If
financing is not available on satisfactory terms, we may be unable to continue
expanding our operations. Equity financing will result in a dilution to existing
shareholders.
Results of
Operations
For the
year ended December 31, 2009, we had revenue of $41,700. Total expenses for the
year ended December 31, 2009, totaled $1,302,540 resulting in a loss of
$2,134,079. Total expenses of $1,302,540 for the period consisted of $806,676
for general and administrative expenses, $180,810 for rent expense, $2,898 for
depreciation expense and $100,000 for deferred investment costs written
off. Additionally, we had other income of $49,602 and interest
expense of $922,841 for the year ended December 31, 2009.
For the
year ended December 31, 2008, we had revenue of $-0-. Total expenses
for the year ended December 31, 2008 totaled $986,602 resulting in a loss of
$1,020,454. Total expenses of $986,602 for the period consisted of $29,760 for
professional fees - related party, $200,000 for executive compensation, $649,048
for general & administrative expenses, and $651 for depreciation expense,
$1,143 for Loss of Property, $6,000 for deferred investment costs written off,
$100,000 for deposit on investment written off. Additionally, we had
other income of $-0- and interest expense of $33,230 for the year ended December
31, 2008.
Capital Resources and
Liquidity
As of
December 31, 2009, we had $2,480 in cash, $714,236 in total assets and
$1,931,415 in total current liabilities. Our current liabilities exceed
our current assets by $1,889,395 as of December 31,
2009.
We
believe we can satisfy our cash requirements for the next twelve months with our
current cash, expected revenues and continued funding from WorldVest Equity,
Inc. However, completion of our plan of operation is subject to attaining
adequate revenue and additional financing. We cannot assure investors that
adequate revenues will be generated. In the absence of our projected revenues,
we may be unable to proceed with our plan of operations. Even without adequate
revenues within the next twelve months, we still anticipate being able to
continue with our present activities, but we may require financing to
potentially achieve our profit, revenue, and growth goals.
Per our
Form 8-K, dated June 26, 2009, WorldVest, Inc. acquired the global merchant
banking operations from WorldVest Equity, Inc. Pursuant to the
agreement, we acquired Global Banking & Advisory assets from WorldVest
Equity, which currently employs eleven (11) individuals, and is headquartered in
New York and Los Angeles offices. With this transaction we acquired
the assets of FutureVest Management (Shenyang) Co., Ltd., a unique license to
perform investment banking, advisory, and investment management services in the
Peoples Republic of China, without the need for any Chinese
partners. Through this acquisition, we are able to provide capital
financing and venture services, as well as use the extensive WorldVest global
relationships to enhance and support the development of the WorldVest Global
Merchant banking plan. Additionally, through this acquisition, we
believe we can attract equally beneficial relationships with the business
communities and governments of Brazil and South Korea.
We
anticipate that our operational, and general and administrative expenses for the
next 12 months will be minimal. We do not anticipate the purchase or
sale of any significant equipment. We also do not expect any
significant additions to the number of employees. The foregoing
represents our best estimate of our cash needs based on current planning and
business conditions. The exact allocation, purposes and timing of any
monies raised in subsequent private financings may vary significantly depending
upon the exact amount of funds raised and our progress with the execution of our
business plan.
7
In the
event we are not successful in reaching our initial revenue targets, additional
funds may be required, and we may not be able to proceed with our business plan
for the development and marketing of our core business. Should this occur, we
would likely seek additional financing to support the continued operation of our
business. We anticipate that depending on market conditions and our plan of
operations, we may incur operating losses in the foreseeable future. Therefore,
our auditors have raised substantial doubt about our ability to continue as a
going concern.
Critical Accounting
Policies
Our
financial statements and related public financial information are based on the
application of accounting principles generally accepted in the United States
(“GAAP”). GAAP requires the use of estimates; assumptions, judgments and
subjective interpretations of accounting principles that have an impact on the
assets, liabilities, revenue and expense amounts reported. These estimates can
also affect supplemental information contained in our external disclosures
including information regarding contingencies, risk and financial condition. We
believe our use if estimates and underlying accounting assumptions adhere to
GAAP and are consistently and conservatively applied. We base our estimates on
historical experience and on various other assumptions that we believe to be
reasonable under the circumstances. Actual results may differ materially from
these estimates under different assumptions or conditions. We continue to
monitor significant estimates made during the preparation of our financial
statements.
Our
significant accounting policies are summarized in Note 1 of our financial
statements. While all these significant accounting policies impact our financial
condition and results of operations, we view certain of these policies as
critical. Policies determined to be critical are those policies that have
the most significant impact on our financial statements and require management
to use a greater degree of judgment and estimates. Actual results may differ
from those estimates. Our management believes that given current facts and
circumstances, it is unlikely that applying any other reasonable judgments or
estimate methodologies would cause effect on our consolidated results of
operations, financial position or liquidity for the periods presented in this
report.
Investments in Companies
Accounting for Using the Equity or Cost Method
Investments
in other entities are accounted for using the equity method or cost basis
depending upon the level of ownership and/or the Company's ability to exercise
significant influence over the operating and financial policies of the investee.
Investments of this nature are recorded at original cost and adjusted
periodically to recognize the Company's proportionate share of the investees'
net income or losses after the date of investment. In accordance with ASC 323,
“Investments-Equity Method and Joint Ventures, when net losses from an
investment accounted for under the equity method exceed its carrying amount, the
investment balance is reduced to zero and additional losses are not provided
for. The Company resumes accounting for the investment under the equity method
if the entity subsequently reports net income and the Company's share of that
net income exceeds the share of net losses not recognized during the period the
equity method was suspended. Investments are written down only when there is
clear evidence that a decline in value that is other than temporary has
occurred. When an investment accounted for using the equity method issues its
own shares, the subsequent reduction in the Company's proportionate interest in
the investee is reflected in income as a deemed dilution gain proportionate
interest in or loss on disposition. The Company evaluates its investments in
companies accounted for by the equity or cost method for impairment when there
is evidence or indicators that a decrease in value may be other than
temporary.
Revenue
recognition
The
Company will recognize revenues through Investment banking, consulting,
financial advisory services, and direct investments consolidating revenues of
our wholly owned platform development subsidiary operations and majority owned
investments, and through cash flow generated from our subsidiaries and
investments.
Stock-based
compensation
The
Company accounts for all compensation related to stock, options or warrants
using a fair value based method whereby compensation cost is measured at the
grant date based on the value of the award and is recognized over the service
period, which is usually the vesting period. The Company uses the Black-Scholes
pricing model to calculate the fair value of options and warrants issued to both
employees and non-employees. Stock issued for compensation is valued using the
market price of the stock on the date of the related agreement.
8
Recent accounting
pronouncements
In
February 2010, the FASB issued ASU No. 2010-09 regarding subsequent events and
amendments to certain recognition and disclosure requirements. Under
this ASU, a public company that is a SEC filer, as defined, is not required to
disclose the date through which subsequent events have been evaluated. This ASU
is effective upon the issuance of this ASU. The adoption of this ASU
did not have a material impact on our consolidated financial
statements.
In
January 2010, the FASB issued ASU No. 2010-06 regarding fair value measurements
and disclosures and improvement in the disclosure about fair value
measurements. This ASU requires additional disclosures regarding
significant transfers in and out of Levels 1 and 2 of fair value measurements,
including a description of the reasons for the transfers. Further,
this ASU requires additional disclosures for the activity in Level 3 fair value
measurements, requiring presentation of information about purchases, sales,
issuances, and settlements in the reconciliation for fair value
measurements. This ASU is effective for fiscal years beginning after
December 15, 2010, and for interim periods within those fiscal
years. We are currently evaluating the impact of this ASU, however,
we do not expect the adoption of this ASU to have a material impact on our
consolidated financial statements.
In
January 2010, the FASB issued ASU No. 2010-02 regarding accounting and reporting
for decreases in ownership of a subsidiary. Under this guidance, an
entity is required to deconsolidate a subsidiary when the entity ceases to have
a controlling financial interest in the subsidiary. Upon
deconsolidation of a subsidiary, an entity recognizes a gain or loss on the
transaction and measures any retained investment in the subsidiary at fair
value. In contrast, an entity is required to account for a decrease
in its ownership interest of a subsidiary that does not result in a change of
control of the subsidiary as an equity transaction. This ASU
clarifies the scope of the decrease in ownership provisions, and expands the
disclosures about the deconsolidation of a subsidiary or de-recognition of a
group of assets. This ASU is effective for beginning in the first
interim or annual reporting period ending on or after December 31,
2009. We are currently evaluating the impact of this ASU, however, we
do not expect the adoption of this ASU to have a material impact on our
consolidated financial statements.
In
January 2010, the FASB issued ASU No. 2010-01 regarding equity and accounting
for distributions to shareholders with components of stock and
cash. This ASU addresses the diversity in practice related to the
accounting for a distribution to shareholders that offers them the ability to
elect to receive their entire distribution in cash or shares of equivalent value
with a potential limitation on the total amount of cash that shareholders can
elect to receive in the aggregate. Historically, some entities have
accounted for the stock portion of the distribution as a new share issuance that
is reflected in earning per share (EPS) prospectively. Other entities have
accounted for the stock portion of the distribution as a stock dividend by
retroactively restating shares outstanding and EPS for all periods
presented. The amendments in this ASU clarify that the stock portion
of a distribution to shareholders that allows them to elect to receive cash or
shares with a potential limitation on the total amount of cash that all
shareholders can elect to receive in the aggregate is considered a share
issuance thus eliminating the diversity in practice. The amendments
in this ASU affect entities that declare dividends to shareholders that may be
paid in cash or shares at the election of the shareholders with a potential
limitation on the total amount of cash that all shareholders can elect to
receive in the aggregate. This ASU is effective for interim and
annual periods ending on or after December 15, 2009, and it is to be applied
retrospectively. The adoption of this ASU did not have an impact on our
consolidated financial statements.
In
December 2009, the FASB issued ASU No. 2009-17 regarding consolidations and
improvements to financial reporting by enterprises involved with VIEs. This ASU
changes how a company determines when an entity that is insufficiently
capitalized or is not controlled through voting should be
consolidated. The determination of whether a company is required to
consolidate an entity is based on, among other things, an entity’s purpose and
design and a company’s ability to direct the activities of the entity that most
significantly impact the entity’s economic performance. This
statement is effective for us beginning in the first quarter of fiscal 2011
(October 1, 2010). We are currently assessing the potential impact that the
adoption of ASU No. 2009-17 will have on our consolidated financial
statements.
In
September 2009, the FASB issued ASU No. 2009-12 – Fair Value Measurements and
Disclosures (Topic 820) – Investments in Certain Entities That Calculate Net
Asset Value per Share (or its equivalent). This ASU permits use of a
practical expedient, with appropriate disclosures, when measuring the fair value
of an alternative investment that does not have a readily determinable fair
value. ASU No. 2009-12 is effective for interim and annual periods
ending after December 15, 2009, with early application
permitted. Since the Company does not currently have any such
investments, it does not anticipate any impact on its financial statements upon
adoption.
In August
2009, the FASB issued ASU No. 2009-05 – Fair Value Measurements and Disclosures
(Topic 820) – Measuring Liabilities at Fair Value. This ASU clarifies
the fair market value measurement of liabilities. In circumstances
where a quoted price in an active market for the identical liability is not
available, a reporting entity is required to measure fair value using one or
more of the following techniques: a technique that uses quoted price of the
identical or a similar liability or liabilities when traded as an asset or
assets, or another valuation technique that is consistent with the principles of
Topic 820 such as an income or market approach. ASU No. 2009-05 was
effective upon issuance and it did not result in any significant financial
impact on the Company upon adoption.
9
On July
1, 2009, the Financial Accounting Standards Board (FASB) officially launched the
FASB Accounting Standards Codification (ASC) 105 -- Generally Accepted Accounting
Principles, which established the FASB Accounting Standards Codification
(“the Codification”), as the single official source of authoritative,
nongovernmental, U.S. GAAP, in addition to guidance issued by the Securities and
Exchange Commission. The Codification is designed to simplify U.S.
GAAP into a single, topically ordered structure. All guidance
contained in the Codification carries an equal level of
authority. The Codification is effective for interim and annual
periods ending after September 15, 2009. Accordingly, the Company
refers to the Codification in respect of the appropriate accounting standards
throughout this document as “FASB ASC”. Implementation of the
Codification did not have any impact on the Company’s consolidated financial
statements.
On June
30, 2009, the FASB issued Accounting Standard Update (ASU) No. 2009-01 (Topic
105) – Generally Accepted Accounting Principles – amendments based on –
Statement of Financial Accounting Standards No. 168 – The FASB Accounting and
Standards Codification and the Hierarchy of Generally Accepted Accounting
Principles. Beginning with this Statement the FASB will no longer issue new
standards in the form of Statements, FASB Staff Positions, or Emerging Issues
Task Force Abstracts. Instead, it will issue Accounting Standard
Updates. This ASU includes FASB Statement No. 168 in its
entirety. While ASU’s will not be considered authoritative in their
own right, they will serve to update the Codification, provide the bases for
conclusions and changes in the Codification, and provide background information
about the guidance. The Codification modifies the GAAP hierarchy to
include only two levels of GAAP: authoritative and
non-authoritative. ASU No. 2009-01 is effective for financial
statements issued for the interim and annual periods ending after September 15,
2009, and the Company does not expect any significant financial impact upon
adoption.
In June
2009, the FASB issued SFAS No. 167, “Amendments to FASB Interpretation No.
46(R)”. SFAS No. 167 addresses the effect on FASB Interpretation
46(R), “Consolidation of Variable Interest Entities” of the elimination of the
qualifying special-purpose entity concept of SFAS No. 166, “Accounting for
Transfers of Financial Assets”. SFAS No. 167 also amends the
accounting and disclosure requirements of FASB Interpretation 46(R) to enhance
the timeliness and usefulness of information about an enterprise’s involvement
in a variable interest entity. This Statement shall be effective as of the
Company’s first interim reporting period that begins after November 15, 2009.
Earlier application is prohibited. The Company does not anticipate
any significant financial impact from adoption of SFAS No. 167. As of September
30, 2009, SFAS No. 167 has not been added to the Codification.
In June
2009, the FASB issued SFAS No. 166, “Accounting for Transfers of Financial
Assets – an amendment of FASB Statement No. 140”. SFAS No. 166 amends
SFAS No. 140, “Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities” by eliminating the concept of special-purpose
entity, requiring the reporting entity to provide more information about sales
of securitized financial assets and similar transactions, particularly if the
seller retains some risk to the assets, changes the requirements for the
de-recognition of financial assets, and provides for the sellers of the assets
to make additional disclosures. This Statement shall be effective as
of the Company’s first interim reporting period that begins after November 15,
2009. Earlier application is prohibited. The Company does not
anticipate any significant financial impact from adoption of SFAS No. 166. As of
September 30, 2009, SFAS No. 166 has not been added to the
Codification.
In May
2009, the FASB issued FASB ASC 855, “Subsequent Events”. This
Statement addresses accounting for and disclosure of events that occur after the
balance sheet date but before financial statements are issued or available to be
issued. FASB ASC 855 requires disclosure of the date through which an
entity has evaluated subsequent events and the basis for that date, the date
issued or date available to be issued. The Company adopted this
Statement in the second quarter of 2009. As a result the date through
which the Company has evaluated subsequent events and the basis for that date
have been disclosed.
In April
2009, the FASB issued an update to FASB ASC 820, “Fair Value Measurements and
Disclosures”, related to providing guidance on when the volume and level of
activity for the asset or liability have significantly decreased and identifying
transactions that are not orderly. The update clarifies the
methodology to be used to determine fair value when there is no active market or
where the price inputs being used represent distressed sales. The
update also reaffirms the objective of fair value measurement, as stated in FASB
ASC 820, which is to reflect how much an asset would be sold in and orderly
transaction, and the need to use judgment to determine if a formerly active
market has become inactive, as well as to determine fair values when markets
have become inactive. The Company adopted this Statement in the
second quarter of 2009 without significant financial impact.
In April
2009, the FASB ASC 320, “Investments – Debt and Equity”, amends current
other-than-temporary guidance for debt securities through increased consistency
in the timing of impairment recognition and enhanced disclosures related to
credit and noncredit components impaired debt securities that are not expected
to be sold. Also, the Statement increases disclosures for both debt
and equity securities regarding expected cash flows, securities with unrealized
losses, and credit losses. The Company adopted this Statement in the
second quarter of 2009 without significant impact to our financial
statements.
In April
2009, the FASB issued an update to FASB ASC 825, “Financial Instruments”, to
require interim disclosures about the fair value of financial
instruments”. This update enhances consistency in financial reporting
by increasing the frequency of fair value disclosures of those assets and
liabilities falling within the scope of FASB ASC 825. The Company adopted this
update in the second quarter of 2009 without significant impact to the financial
statements.
10
In April
2009, the FASB issued an update to FASB ASC 805, “Business Combinations”, that
clarifies and amends FASB ASC 805, as it applies to all assets acquired and
liabilities assumed in a business combination that arise from
contingencies. This update addresses initial recognition and
measurement issues, subsequent measurement and accounting, and disclosures
regarding these assets and liabilities arising from contingencies in a business
combination. The Company adopted this Statement in the second quarter
of 2009 without significant impact to the financial statements.
In
January 2009, the FASB issued an update to FASB ASC 325, “Investments – Other”,
which amends the impairments guidance on recognition of interest income and
impairment on purchased beneficial interests and beneficial interests that
continue to be held by a transferor in securitized financial assets to achieve
more consistent determination of whether an other-than-temporary impairment has
occurred. The update also retains and emphasizes the objective of an other
than-temporary impairment assessment and the related disclosure requirements in
FASB ASC 320, “Investments – Debt and Equity Securities”, and other related
guidance. The adoption of this update in the second quarter of 2009
did not have a significant impact on the Company’s financial
statements.
In
November 2008, EITF issued new guidance under FASB ASC 350, “Intangibles –
Goodwill and Other” on accounting for defensive intangible
assets”. The new guidance applies to all acquired intangible assets
in which the acquirer does not intend to actively use the asset but intends to
hold (lock up) the asset to prevent its competitors from obtaining or using the
asset (a defensive asset). This guidance was adopted by WorldVest in
January 2009 without impact to the financial statements.
In May
2008, the FASB issued an update to FASB ASC 470, “Debt”, with respect to
accounting for convertible debt instruments that may be settled in cash upon
conversion including partial cash settlement. This update applies to
convertible debt instruments that, by their stated terms, may be settled in cash
(or other assets) upon conversion, including partial cash settlement, unless the
embedded conversion option is required to be separately accounted for as a
derivative under FASB ASC 815, “Derivatives and
Hedging.” Additionally, this update specifies that issuers of such
instruments should separately account for the liability and equity components in
a manner that will reflect the entity’s nonconvertible debt borrowing rate when
interest cost recognized in subsequent periods. The update is effective for
financial statements issued for fiscal years beginning after December 15, 2008,
and interim periods within those fiscal years. The Company does not
currently have any debt instruments for which this update would
apply. This update was adopted in January 2009 without significant
financial impact.
In March
2008, the FASB issued an update to FASB ASC 815, “Derivatives and Hedging” This
update is intended to enhance the current disclosure framework in FASB ASC
815. Under this update, entities will have to provide disclosures
about (a) how and why and entity uses derivative instruments, (b) how derivative
instruments and related hedged items are accounted for under FASB ASC 815 and
its related interpretations, and (c), how derivative instruments and related
hedged items effect an entity’s financial position, financial performance and
cash flows. This update is effective for all financial statements
issued for fiscal and interim periods beginning after November 15,
2008. The Company does not currently have any derivative instruments,
nor does it engage in hedging activities, therefore, the Company’s adoption of
this update in the first quarter of 2009 was without significant financial
impact.
In
December 2007, the FASB issued an update to FASB ASC 805, “Business
Combinations” which establishes principles and requirements for how an acquirer
recognizes and measures in its financial statements the identifiable assets
acquired, the liabilities assumed, any non-controlling interest in the acquiree,
and the goodwill acquired. This update also establishes disclosure requirements
to enable the evaluation of the nature and financial effects of the business
combination. This update is effective for the Company with respect to business
combinations for which the acquisition date is on or after January 1, 2009.
The Company adopted this update in the first quarter of 2009 without significant
financial impact.
In
December 2007, the FASB issued an update to FASB ASC 810, “Consolidation”, which
establishes accounting and reporting standards for ownership interests in
subsidiaries held by parties other than the parent, the amount of consolidated
net income attributable to the parent and to the non-controlling interest,
changes in a parent’s ownership interest, and the valuation of retained
non-controlling equity investments when a subsidiary is deconsolidated. SFAS 160
also establishes disclosure requirements that clearly identify and distinguish
between the interests of the parent and the interests of non-controlling owners.
This update is effective for the Company as of January 1, 2009. The Company
adopted this update in January 2009 without significant impact on the
consolidated financial position, results of operations, and
disclosures.
11
Off Balance Sheet
Arrangements
We do not
have any off-balance sheet arrangements, financings, or other relationships with
unconsolidated entities or other persons, also known as “special purpose
entities” (SPEs).
ITEM
7A. QUANTITIATIVE AND QUALITATIVE DISCLOUSURES ABOUT MARKET
RISK
Not
applicable because we are a smaller reporting company.
ITEM
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
12
REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the
Board of Directors and
Stockholders
of WorldVest, Inc.
We have
audited the accompanying combined balance sheets of WorldVest, Inc. (“the
Company”) (formerly known as Catalyst Ventures Incorporated) as of December 31,
2009 and 2008, and the
related statements of operations, stockholders’ deficit, and cash flows for the
years in the two-year period ended December 31, 2009 and for the period from
September 17, 2007 (Inception) to December 31, 2009. WorldVest’s management is
responsible for these financial statements. Our responsibility is to express an
opinion on these financial statements based on our audits.
We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of WorldVest as of December 31, 2009
and 2008, and the results of its operations and its cash flows for each of the
years in the two-year period ended December 31, 2009 and for the period from
September 17, 2007 (Inception) to December 31, 2009 in conformity with
accounting principles generally accepted in the United States of
America.
The
accompanying combined financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the combined
financial statements, the Company’s current liabilities exceed current assets
and has incurred recurring losses, all of which raise substantial doubt about
the Company’s ability to continue as a going concern. Management’s plans in
regards to these matters are also described in Note 2. The consolidated
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
/s/ L.L.
Bradford & Company, LLC
April 15,
2010
Las
Vegas, Nevada
13
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Combined
Balance Sheets
(Audited)
December
31,
|
December
31,
|
|||||||
2009
|
2008
|
|||||||
Assets
|
||||||||
Current
assets:
|
||||||||
Cash
|
$ | 2,480 | $ | 37,636 | ||||
Prepaid
expenses
|
9,359 | - | ||||||
Salary
Advances
|
2,250 | - | ||||||
Notes
receivable
|
27,931 | - | ||||||
Total
current assets
|
42,020 | 37,636 | ||||||
Property
and equipment, net of accumulated depreciation
|
22,216 | - | ||||||
Deferred
acquisition costs
|
650,000 | - | ||||||
Total
assets
|
$ | 714,236 | $ | 37,636 | ||||
Liabilities
and Stockholders' (Deficit)
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable
|
$ | 51,337 | $ | 14,049 | ||||
Accrued
payroll
|
92,357 | - | ||||||
Notes
payable - related parties
|
1,668,041 | 419,594 | ||||||
Accrued
interest payable - related parties
|
119,680 | 10,533 | ||||||
Total
current liabilities
|
1,931,415 | 444,176 | ||||||
Long-term
liabilities:
|
||||||||
Total
long-term liabilities
|
- | - | ||||||
Total
liabilities
|
1,931,415 | 444,176 | ||||||
Commitments
and contingencies
|
||||||||
Stockholders'
(deficit):
|
||||||||
Preferred
stock, $0.001 par value, 10,000,000 shares
|
||||||||
authorized,
5,000,000 and no shares issued and outstanding
|
||||||||
as
of December 30, 2009 and December 31, 2008
|
4,000 | - | ||||||
Common
stock, $0.001 par value, 100,000,000 shares
|
||||||||
authorized,
58,979,592 and 55,153,750 shares issued and outstanding
|
||||||||
as
of December 31, 2009 and December 31, 2008, respectively
|
58,980 | 55,154 | ||||||
Additional
paid-in capital
|
10,443,334 | 3,412,264 | ||||||
Common
Stock Payable
|
284,544 | - | ||||||
(Deficit)
accumulated during development stage
|
(12,008,037 | ) | (3,873,958 | ) | ||||
Total
stockholders' (deficit)
|
(1,217,179 | ) | (406,540 | ) | ||||
Total
liabilities and stockholders' (deficit)
|
$ | 714,236 | $ | 37,636 |
See
Accompanying Notes to Combined Financial Statements
14
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Combined
Statements of Operations
(Audited)
September
17, 2007
|
||||||||||||
For
the year ended
|
(inception)
to
|
|||||||||||
December
31,
|
December
31,
|
|||||||||||
2009
|
2008
|
2009
|
||||||||||
Income
|
$ | 41,700 | $ | - | $ | 41,700 | ||||||
Expenses:
|
||||||||||||
Professional
services - related party
|
- | 29,760 | 84,760 | |||||||||
Rent
expense
|
180,810 | - | 180,810 | |||||||||
Executive
compensation
|
212,156 | 200,000 | 2,812,156 | |||||||||
General
and administrative expenses
|
806,676 | 649,048 | 1,680,161 | |||||||||
Depreciation
expense
|
2,898 | 651 | 4,361 | |||||||||
Loss
on property, plant and equipment
|
- | 1,143 | 1,143 | |||||||||
Failed
acquisition costs
|
- | - | 143,200 | |||||||||
Deferred
acquisition costs written off
|
100,000 | 6,000 | 106,000 | |||||||||
Deposit
on investment written off
|
- | 100,000 | 100,000 | |||||||||
Total
expenses
|
1,302,540 | 986,602 | 5,112,591 | |||||||||
Net
operating (loss)
|
(1,260,840 | ) | (986,602 | ) | (5,070,892 | ) | ||||||
Other
income/(expense)
|
||||||||||||
Other
income
|
49,602 | - | 49,602 | |||||||||
Interest
expense - related parties
|
(922,841 | ) | (33,852 | ) | (986,748 | ) | ||||||
Total
other income/(expense)
|
(873,239 | ) | (33,852 | ) | (937,146 | ) | ||||||
Net
(loss) before provision for income taxes
|
(2,134,079 | ) | (1,020,454 | ) | (6,008,037 | ) | ||||||
Provision
for income taxes
|
- | - | - | |||||||||
Net
(loss)
|
$ | (2,134,079 | ) | $ | (1,020,454 | ) | $ | (6,008,037 | ) | |||
Weighted
average number of common shares
|
55,166,967 | 67,302,419 | ||||||||||
outstanding
- basic and fully diluted
|
||||||||||||
Net
(loss) per common share - basic and fully diluted
|
$ | (0.04 | ) | $ | (0.02 | ) |
See
Accompanying Notes to Combined Financial Statements
15
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Combined
Statement of Stockholders' (Deficit)
(Audited)
Common
|
Deficit
|
|||||||||||||||||||||||||||||||||||
Stock
|
Accumulated
|
|||||||||||||||||||||||||||||||||||
Additional
|
Issued
for
|
Common
|
During
|
Total
|
||||||||||||||||||||||||||||||||
Common
Shares
|
Preferred
Shares
|
Paid-In
|
Prepaid
|
Stock
|
Development
|
Stockholders'
|
||||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Services
|
Payable
|
Stage
|
(Deficit)
|
||||||||||||||||||||||||||||
Shares
issued for services September 17, 2007
|
55,000,000 | $ | 55,000 | $ | - | $ | - | $ | - | $ | - | $ | 55,000 | |||||||||||||||||||||||
Shares
issued for cash September 30, 2007
|
47,000 | 47 | 46,953 | 47,000 | ||||||||||||||||||||||||||||||||
Cash
received for common stock payable
|
34,250 | - | 34,250 | |||||||||||||||||||||||||||||||||
Net
(loss) for the period September 17, 2007 (inception) through December 31,
2007
|
(2,853,504 | ) | (2,853,504 | ) | ||||||||||||||||||||||||||||||||
Balance,
December 31, 2007
|
55,047,000 | 55,047 | 0 | 0 | 46,953 | - | 34,250 | (2,853,504 | ) | (2,717,254 | ) | |||||||||||||||||||||||||
Shares
issued for cash January 18, 2008
|
56,750 | 57 | 56,693 | (34,250 | ) | 22,500 | ||||||||||||||||||||||||||||||
Shares
issued for prepaid services March 31, 2008
|
30,000,000 | 30,000 | 22,470,000 | (22,500,000 | ) | - | ||||||||||||||||||||||||||||||
Shares
issued for prepaid services cancelled June 9, 2008
|
(20,000,000 | ) | (20,000 | ) | (14,455,806 | ) | 14,475,806 | - | ||||||||||||||||||||||||||||
Amortization
of prepaid services paid in shares
|
576,613 | 576,613 | ||||||||||||||||||||||||||||||||||
Contribution
of accrued executive compensation and related payroll
|
2,682,055 | 2,682,055 | ||||||||||||||||||||||||||||||||||
Cash
received for common stock payable June 19, 2008
|
50,000 | 50,000 | ||||||||||||||||||||||||||||||||||
Shares
issued for common stock payable June 25, 2008
|
50,000 | 50 | 49,950 | (50,000 | ) | - | ||||||||||||||||||||||||||||||
Shares
issued for prepaid services cancelled August 13, 2008
|
(10,000,000 | ) | (10,000 | ) | (7,437,581 | ) | 7,447,581 | - | ||||||||||||||||||||||||||||
Net
(loss) for the year ended December 31, 2008
|
(1,020,454 | ) | (1,020,454 | ) | ||||||||||||||||||||||||||||||||
Balance,
December 31, 2008
|
55,153,750 | 55,154 | 0 | 0 | 3,412,264 | - | - | (3,873,958 | ) | (406,540 | ) | |||||||||||||||||||||||||
Acquisition
of entites under common control
|
(6,000,000 | ) | (6,000,000 | ) | ||||||||||||||||||||||||||||||||
Warrants
issued with convertible debt and beneficial conversion
feature
|
2,941,773 | 2,941,773 | ||||||||||||||||||||||||||||||||||
Shares
issued for Cash
|
155,842 | 156 | 233,604 | 233,760 | ||||||||||||||||||||||||||||||||
Shares
to be issue for accrued interest from conversion of convertible debenture
on December 31, 2009
|
- | 284,544 | 284,544 | |||||||||||||||||||||||||||||||||
Issuance
for Preferred Series B shares from conversion of convertible debt on
December 31, 2009.
|
4,000,000 | 4,000 | 3,492,364 | 3,496,364 | ||||||||||||||||||||||||||||||||
Issuance
of commons shares for conversion of note to ZumaHedgeFund, LLC as of
December 31, 2009.
|
3,670,000 | 3,670 | 363,330 | - | 367,000 | |||||||||||||||||||||||||||||||
Issuance
of Preferred Series C shares from conversion of convertible debenture on
December 31, 2009.
|
1,000,000 | 0 | - | |||||||||||||||||||||||||||||||||
Net
(loss) for the nine months ended December 30,
2009
|
(2,134,079 | ) | (2,134,079 | ) | ||||||||||||||||||||||||||||||||
Balance,
December 31, 2009
|
58,979,592 | $ | 58,980 | 5,000,000 | 4,000 | $ | 10,443,335 | $ | - | $ | 284,544 | $ | (12,008,037 | ) | $ | (1,217,179 | ) |
See
Accompanying Notes to Combined Financial Statements
16
WorldVest, Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Combined
Statements of Cash Flows
(Audited)
September
17, 2007
|
||||||||||||
For
the year ended
|
(inception)
to
|
|||||||||||
December
31,
|
December
31,
|
|||||||||||
2009
|
2008
|
2009
|
||||||||||
CASH
FLOWS FROM OPERATING ACTIVITIES
|
||||||||||||
Net
(loss)
|
$ | (2,134,079 | ) | $ | (1,020,117 | ) | $ | (6,008,037 | ) | |||
Adjustments
to reconcile net (loss)
|
||||||||||||
to
net cash used in operating activities:
|
||||||||||||
Shares
issued for services
|
- | - | 55,000 | |||||||||
Deferred
acquisition cost written off
|
- | 6,000 | 6,000 | |||||||||
Deposit
on investment written off
|
- | 100,000 | 100,000 | |||||||||
Fixed
assets written down
|
100,000 | - | 100,000 | |||||||||
Depreciation
expense
|
2,898 | 651 | 4,361 | |||||||||
Amortization
of prepaid services paid with common stock
|
- | 576,613 | 576,613 | |||||||||
Loss
on property and equipment
|
- | 1,143 | 1,143 | |||||||||
Amortization
of the warrants and benefical conversion feature
|
438,137 | - | 438,137 | |||||||||
Changes
in operating assets and liabilities:
|
||||||||||||
(Increase)
in prepaid expenses
|
(9,359 | ) | - | (9,359 | ) | |||||||
(Increase)
in employee advances
|
(2,250 | ) | - | (2,250 | ) | |||||||
(Increase)
in accrued interest receivable
|
(10,578 | ) | - | (10,578 | ) | |||||||
(Increase)
in accrued expenses reimbursement
|
- | (214,732 | ) | - | ||||||||
Increase
in accounts payable
|
37,288 | 6,448 | 51,736 | |||||||||
Increase
in accrued payroll and payroll taxes
|
92,357 | 16,150 | 178,238 | |||||||||
Increase
in accrued interest payable - related party
|
426,363 | (19,522 | ) | 436,896 | ||||||||
Increase
in due to related parties
|
- | 52,500 | 52,500 | |||||||||
Increase
in accrued executive compensation
|
- | 200,000 | 2,600,000 | |||||||||
Net
cash (used) in operating activities
|
(1,059,223 | ) | (294,866 | ) | (1,429,600 | ) | ||||||
CASH
FLOWS FROM INVESTING ACTIVITIES
|
||||||||||||
Proceeds
for notes receivable - related party
|
(230,943 | ) | - | (230,943 | ) | |||||||
Payments
from notes receivable - related party
|
44,851 | - | 44,851 | |||||||||
Purchase
of property, plant and equipment
|
(4,877 | ) | (982 | ) | (7,483 | ) | ||||||
Deferred
acquisition cost
|
- | - | (6,000 | ) | ||||||||
Deposit
on investment
|
- | - | (100,000 | ) | ||||||||
Investment
in WV Capital Partners Asset
|
(24,500 | ) | - | (24,500 | ) | |||||||
Due
from Related Party - 2008
|
- | (30,337 | ) | (30,337 | ) | |||||||
Net
cash (used) by investing activities
|
(215,469 | ) | (31,319 | ) | (354,412 | ) | ||||||
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||||||||||||
Proceeds
from notes payable - related party
|
1,189,608 | 397,094 | 1,733,037 | |||||||||
Payments
on notes payable - related party
|
(183,832 | ) | (131,723 | ) | (334,055 | ) | ||||||
Proceeds
from conversion of Accrued Interest on Debentures to common
stock
|
- | - | - | |||||||||
Proceeds
from conversion of Convertible Debentures
|
- | - | - | |||||||||
Proceeds
from sale of common stock, net of offering costs
|
233,760 | 72,500 | 387,510 | |||||||||
Net
cash provided by financing activities
|
1,239,536 | 337,871 | 1,786,492 |
17
NET
CHANGE IN CASH
|
(35,156 | ) | 11,686 | 2,480 | ||||||||
CASH
AT BEGINNING OF YEAR
|
37,636 | 25,950 | - | |||||||||
CASH
AT END OF YEAR
|
$ | 2,480 | $ | 37,636 | $ | 2,480 | ||||||
SUPPLEMENTAL
INFORMATION:
|
||||||||||||
Interest
paid
|
$ | - | $ | - | $ | - | ||||||
Income
taxes paid
|
$ | - | $ | - | $ | - | ||||||
NON-CASH
TRANSACTIONS:
|
||||||||||||
Common
stock issued for prepaid services
|
$ | - | $ | 22,500,000 | $ | 22,500,000 | ||||||
Common
stock issued for prepaid services cancelled
|
$ | - | $ | 21,923,387 | $ | 21,923,387 | ||||||
Contribution
of accrued executive compensation and related payroll
taxes
|
$ | - | $ | 2,682,055 | $ | 2,682,055 | ||||||
Acquisition
of entites under common control
|
$ | 6,000,000 | $ | - | $ | 6,000,000 | ||||||
Assumption
of note payable - related party for asset purchase
|
||||||||||||
Investment
in WV Capital Partners
|
$ | 100,000 | $ | - | $ | 100,000 | ||||||
Deferred
acquisition costs
|
650,000 | - | 650,000 | |||||||||
750,000 | 750,000 | |||||||||||
Assumption
of property, plant and equipment in asset purchase
|
$ | 20,237 | $ | - | $ | 100,000 | ||||||
Transfer
of notes and interest receivable in satisfaction of
|
||||||||||||
notes
and interest payable - related parties
|
$ | 193,239 | $ | - | $ | 193,239 | ||||||
Conversion
of notes and interest payable - related party into
|
||||||||||||
preferred
stock
|
$ | 6,284,544 | $ | - | $ | 6,284,544 | ||||||
Debt
discount associated with issuance of warrants and
|
||||||||||||
beneficial
conversion feature attached to convertible note
|
$ | 2,941,773 | $ | - | $ | 2,941,773 | ||||||
Transfer
of notes and interest receivable in satisfaction of
|
||||||||||||
into
common stock
|
$ | 367,000 | $ | - | $ | 367,000 |
See
Accompanying Notes to Combined Financial Statements
18
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
(Unaudited)
Note
1: Description of Business and Summary of Significant Accounting
Policies
Description of
Business
WorldVest,
Inc. (A Development Stage Company) (hereafter “WorldVest” or the “Company”) was
organized September 17, 2007 (Date of Inception) under the laws of the State of
Florida, under the name Catalyst Ventures Incorporated. The Company
filed for a name change on July 2, 2009, and is now known as WorldVest,
Inc. The Company is authorized to issue 10,000,000 shares of its
$.001 par value preferred stock and 100,000,000 shares of its $.001 par value
common stock.
The
business of the Company is to grow as a global merchant bank that offers not
only traditional investment banking, asset management and advisory services, but
also makes direct investments as a principal in select high-growth transactions
on a global basis. Recognizing the disconnect that exists between the
needs of companies and the limitations of traditional investment banking,
private equity, and venture capital institutions, WorldVest seeks to set a new
standard, emerging as a partner and solution provider where one did not
previously exist.
The
Company is considered a development stage company and in accordance with
Accounting Standards Codification (ASC) 915, “Development Stage
Entities.”
Principles of
Combination
Financial
Accounting Standards Board (“FASB”) ASC 805, “Business Combinations” ASC 805 a
“business combination” excludes transfers of net assets or exchanges of equity
interests between entities under common control. ASC 805 also states that
transfers of net assets or exchanges of equity interests between entities under
common control should be
accounted
for similar to the
pooling-of-interests method (“as-if
pooling-of-interests”) in that the entity that receives the net assets or the
equity interests initially recognizes the assets and liabilities transferred at
their carrying amounts in the accounts of the transferring entity at the date of
transfer. Because the Company and WorldVest, LLC and FutureVest were under
common control at the time of the acquisitions, the transfer of assets and
liabilities of WorldVest, LLC and FutureVest were accounted for at historical
cost in a manner similar to a pooling of interests. For financial accounting
purposes, the acquisition was viewed as a change in reporting entity and, as a
result, required restatement of the Company’s financial statements for all
periods subsequent to June 18, 2009, the date of the Transaction and the date at
which common control of the Company and WorldVest, LLC and FutureVest by
WorldVest, Inc. commenced. Accordingly, the Company’s combined balance sheet as
of December 31, 2009 and December 31, 2008, and the combined statement of
operations, combined statement of stockholders’ deficit and combined statement
of cash flows for the year ended December 31, 2009 and for the period from
September 17, 2007 through December 31, 2009 include WorldVest, Inc., WorldVest,
LLC and FutureVest.
Business
Combinations
On June
18, 2009, the Company acquired the Global Banking & Advisory assets of
WorldVest Equity, Inc., a related-party entity, for $6 million, subject to
certain post-closing adjustments. The purchase price consisted of a convertible
debenture of $6 million. As described above, since WorldVest, Inc. was under
control of WorldVest Equity, Inc. at the time of the asset acquisitions, the
transfer of assets and liabilities of WorldVest, LLC and FutureVest were
accounted for at historical cost in a manner similar to a pooling of interests.
The $6 million of convertible debentures paid to WorldVest Equity, Inc., a
related party, for 100% of the Banking & Advisory assets was treated as
dividend and recorded to retained earnings. In “as-if
pooling-of-interests” accounting, financial statements of the previously
separate companies for periods under common control prior to the combination are
restated on a combined basis to furnish comparative information. At June 30,
2009, the WorldVest, LLC assets added $924,447 of total assets and FutureVest
added $114,740 of total assets. For the period from January 1, 2009
through December 31, 2009, WorldVest, LLC assets added revenue and net loss of
$28,439 and $641,557, respectively. For the period from January 1, 2009 through
December 31, 2009, FutureVest added revenue and net loss of $-0- and $21,741,
respectively.
Cash and
Equivalents
For the
purpose of the statement of cash flows, all highly liquid investments with an
original maturity of three months or less are considered to be cash
equivalents. There were no cash equivalents as of December 31,
2009.
19
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
1: Description of Business and Summary of Significant Accounting Policies
(Continued)
Investments in Companies
Accounting for Using the Equity or Cost Method
Investments
in other entities are accounted for using the equity method or cost basis
depending upon the level of ownership and/or the Company's ability to exercise
significant influence over the operating and financial policies of the investee.
Investments of this nature are recorded at original cost and adjusted
periodically to recognize the Company's proportionate share of the investees'
net income or losses after the date of investment. In accordance with ASC 323,
“Investments-Equity Method and Joint Ventures”, when net losses from an
investment accounted for under the equity method exceed its carrying amount, the
investment balance is reduced to zero and additional losses are not provided
for. The Company resumes accounting for the investment under the equity method
if the entity subsequently reports net income and the Company's share of that
net income exceeds the share of net losses not recognized during the period the
equity method was suspended. Investments are written down only when there is
clear evidence that a decline in value that is other than temporary has
occurred. When an investment accounted for using the equity method issues its
own shares, the subsequent reduction in the Company's proportionate interest in
the investee is reflected in income as a deemed dilution gain proportionate
interest in or loss on disposition. The Company evaluates its investments in
companies accounted for by the equity or cost method for impairment when there
is evidence or indicators that a decrease in value may be other than
temporary.
Revenue
Recognition
The
Company will recognize revenues from Investment Banking, consulting, financial
advisory services, and direct investments consolidating revenues of our wholly
owned subsidiary operations and majority owned investments, and through cash
flow generated from our subsidiaries and investments.
Stock-based
compensation
The
Company accounts for all compensation related to stock, options or warrants
using a fair value based method whereby compensation cost is measured at the
grant date based on the value of the award and is recognized over the service
period, which is usually the vesting period. The Company uses the Black-Scholes
pricing model to calculate the fair value of options and warrants issued to both
employees and non-employees. Stock issued for compensation is valued using the
market price of the stock on the date of the related agreement.
Dividends
The
Company has not yet adopted any policy regarding payment of
dividends. No dividends have been paid or declared since
inception.
Loss per Common
Share
The
Company presents basic loss per share (“EPS”) and diluted EPS on the face of the
statement of operations. Basic EPS is computed by dividing reported
losses by the weighted average shares outstanding. Diluted EPS is
computed by adding to the weighted average shares the dilutive effect if stock
options and warrants were exercised into common stock. For the years
ended December 31, 2009 and 2008 the denominator in the diluted EPS computation
is the same as the denominator for basic EPS because the Company has no stock
options and warrants outstanding.
Income
Taxes
The
Company accounts for income taxes under the asset and liability method, which
requires the recognition of deferred tax assets and liabilities for the expected
future tax consequences of events that have been included in the financial
statements. Under this method, deferred tax assets and liabilities are
determined based on the differences between the financial statements and tax
basis of assets and liabilities using enacted tax rates in effect for the year
in which the differences are expected to reverse. The effect of a change in tax
rates on deferred tax assets and liabilities is recognized in income in the
period that includes the enactment date.
The
Company records net deferred tax assets to the extent the Company believes these
assets will more likely than not be realized. In making such determination, the
Company considers all available positive and negative evidence, including future
reversals of existing taxable temporary differences, projected future taxable
income, tax planning strategies and recent financial operations. A valuation
allowance is established against deferred tax assets that do not meet the
criteria for recognition. In the event the Company were to determine that it
would be able to realize deferred income tax assets in the future in excess of
their net recorded amount, the would make an adjustment to the valuation
allowance which would reduce the provision for income taxes.
20
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
1: Description of Business and Summary of Significant Accounting Policies
(Continued)
The
Company follows the accounting guidance which provides that a tax benefit from
an uncertain tax position may be recognized when it is more likely than not that
the position will be sustained upon examination, including resolutions of any
related appeals or litigation processes, based on the technical merits. Income
tax positions must meet a more-likely-than-not recognition threshold at the
effective date to be recognized initially and in subsequent periods. Also
included is guidance on measurement, derecognition, classification, interest and
penalties, accounting in interim periods, disclosure and
transition.
Use of
Estimates
The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities as of the date
of the financial statements and the reported amounts of revenue and expenses
during the reporting period. Actual results could differ from those
estimates.
Fair Value of Financial
Instruments
The
Company has financial instruments whereby the fair value of the financial
instruments could be different than that recorded on a historical basis in the
accompanying balance sheet. The Company’s financial instruments
consist of cash and payables. The carrying amounts of the Company’s
financial instruments approximate their fair values as of September 30, 2009 due
to their short-term nature.
Recent accounting
pronouncements
In
February 2010, the FASB issued ASU No. 2010-09 regarding subsequent events and
amendments to certain recognition and disclosure requirements. Under
this ASU, a public company that is a SEC filer, as defined, is not required to
disclose the date through which subsequent events have been evaluated. This ASU
is effective upon the issuance of this ASU. The adoption of this ASU
did not have a material impact on our consolidated financial
statements.
In
January 2010, the FASB issued ASU No. 2010-06 regarding fair value measurements
and disclosures and improvement in the disclosure about fair value
measurements. This ASU requires additional disclosures regarding
significant transfers in and out of Levels 1 and 2 of fair value measurements,
including a description of the reasons for the transfers. Further,
this ASU requires additional disclosures for the activity in Level 3 fair value
measurements, requiring presentation of information about purchases, sales,
issuances, and settlements in the reconciliation for fair value
measurements. This ASU is effective for fiscal years beginning after
December 15, 2010, and for interim periods within those fiscal
years. We are currently evaluating the impact of this ASU, however,
we do not expect the adoption of this ASU to have a material impact on our
consolidated financial statements.
In
January 2010, the FASB issued ASU No. 2010-02 regarding accounting and reporting
for decreases in ownership of a subsidiary. Under this guidance, an
entity is required to deconsolidate a subsidiary when the entity ceases to have
a controlling financial interest in the subsidiary. Upon
deconsolidation of a subsidiary, an entity recognizes a gain or loss on the
transaction and measures any retained investment in the subsidiary at fair
value. In contrast, an entity is required to account for a decrease
in its ownership interest of a subsidiary that does not result in a change of
control of the subsidiary as an equity transaction. This ASU
clarifies the scope of the decrease in ownership provisions, and expands the
disclosures about the deconsolidation of a subsidiary or de-recognition of a
group of assets. This ASU is effective for beginning in the first
interim or annual reporting period ending on or after December 31,
2009. We are currently evaluating the impact of this ASU, however, we
do not expect the adoption of this ASU to have a material impact on our
consolidated financial statements.
In
January 2010, the FASB issued ASU No. 2010-01 regarding equity and accounting
for distributions to shareholders with components of stock and
cash. This ASU addresses the diversity in practice related to the
accounting for a distribution to shareholders that offers them the ability to
elect to receive their entire distribution in cash or shares of equivalent value
with potential limitation on the total amount of cash that shareholders can
elect to receive in the aggregate. Historically, some entities have
accounted for the stock portion of the distribution as a new share issuance that
is reflected in earning per share (EPS) prospectively. Other entities have
accounted for the stock portion of the distribution as a stock dividend by
retroactively restating shares outstanding and EPS for all periods
presented. The amendments in this ASU clarify that the stock portion
of a distribution to shareholders that allows them to elect to receive cash or
shares with a potential limitation on the total amount of cash that all
shareholders can elect to receive in the aggregate is considered a share
issuance thus eliminating the diversity in practice.
21
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
1: Description of Business and Summary of Significant Accounting Policies
(Continued)
The
amendments in this ASU affect entities that declare dividends to shareholders
that may be paid in cash or shares at the election of the shareholders with a
potential limitation on the total amount of cash that all shareholders can elect
to receive in the aggregate. This ASU is effective for interim and
annual periods ending on or after December 15, 2009, and it is to be applied
retrospectively. The adoption of this ASU did not have an impact on our
consolidated financial statements.
In
December 2009, the FASB issued ASU No. 2009-17 regarding consolidations and
improvements to financial reporting by enterprises involved with VIEs. This ASU
changes how a company determines when an entity that is insufficiently
capitalized or is not controlled through voting should be
consolidated. The determination of whether a company is required to
consolidate an entity is based on, among other things, an entity’s purpose and
design and a company’s ability to direct the activities of the entity that most
significantly impact the entity’s economic performance. This
statement is effective for us beginning in the first quarter of fiscal 2011
(October 1, 2010). We are currently assessing the potential impact that the
adoption of ASU No. 2009-17 will have on our consolidated financial
statements.
In
September 2009, the FASB issued ASU No. 2009-12 – Fair Value Measurements and
Disclosures (Topic 820) – Investments in Certain Entities That Calculate Net
Asset Value per Share (or its equivalent). This ASU permits use of a
practical expedient, with appropriate disclosures, when measuring the fair value
of an alternative investment that does not have a readily determinable fair
value. ASU No. 2009-12 is effective for interim and annual periods
ending after December 15, 2009, with early application
permitted. Since the Company does not currently have any such
investments, it does not anticipate any impact on its financial statements upon
adoption.
In August
2009, the FASB issued ASU No. 2009-05 – Fair Value Measurements and Disclosures
(Topic 820) – Measuring Liabilities at Fair Value. This ASU clarifies
the fair market value measurement of liabilities. In circumstances
where a quoted price in an active market for the identical liability is not
available, a reporting entity is required to measure fair value using one or
more of the following techniques: a technique that uses quoted price of the
identical or a similar liability or liabilities when traded as an asset or
assets, or another valuation technique that is consistent with the principles of
Topic 820 such as an income or market approach. ASU No. 2009-05 was
effective upon issuance and it did not result in any significant financial
impact on the Company upon adoption.
On July
1, 2009, the Financial Accounting Standards Board (FASB) officially launched the
FASB Accounting Standards Codification (ASC) 105 -- Generally Accepted Accounting
Principles, which established the FASB Accounting Standards Codification
(“the Codification”), as the single official source of authoritative,
nongovernmental, U.S. GAAP, in addition to guidance issued by the Securities and
Exchange Commission. The Codification is designed to simplify U.S.
GAAP into a single, topically ordered structure. All guidance
contained in the Codification carries an equal level of
authority. The Codification is effective for interim and annual
periods ending after September 15, 2009. Accordingly, the Company
refers to the Codification in respect of the appropriate accounting standards
throughout this document as “FASB ASC”. Implementation of the
Codification did not have any impact on the Company’s consolidated financial
statements.
On June
30, 2009, the FASB issued Accounting Standard Update (ASU) No. 2009-01 (Topic
105) – Generally Accepted Accounting Principles – amendments based on –
Statement of Financial Accounting Standards No. 168 – The FASB Accounting and
Standards Codification and the Hierarchy of Generally Accepted Accounting
Principles. Beginning with this Statement the FASB will no longer issue new
standards in the form of Statements, FASB Staff Positions, or Emerging Issues
Task Force Abstracts. Instead, it will issue Accounting Standard
Updates. This ASU includes FASB Statement No. 168 in its
entirety. While ASU’s will not be considered authoritative in their
own right, they will serve to update the Codification, provide the bases for
conclusions and changes in the Codification, and provide background information
about the guidance. The Codification modifies the GAAP hierarchy to
include only two levels of GAAP: authoritative and
non-authoritative. ASU No. 2009-01 is effective for financial
statements issued for the interim and annual periods ending after September 15,
2009, and the Company does not expect any significant financial impact upon
adoption
22
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
1: Description of Business and Summary of Significant Accounting Policies
(Continued)
In June
2009, the FASB issued SFAS No. 167, “Amendments to FASB Interpretation No.
46(R)”. SFAS No. 167 addresses the effect on FASB Interpretation
46(R), “Consolidation of Variable Interest Entities” of the elimination of the
qualifying special-purpose entity concept of SFAS No. 166, “Accounting for
Transfers of Financial Assets”. SFAS No. 167 also amends the
accounting and disclosure requirements of FASB Interpretation 46(R) to enhance
the timeliness and usefulness of information about an enterprise’s involvement
in a variable interest entity. This Statement shall be effective as of the
Company’s first interim reporting period that begins after November 15, 2009.
Earlier application is prohibited. The Company does not anticipate
any significant financial impact from adoption of SFAS No. 167. As of September
30, 2009, SFAS No. 167 has not been added to the Codification.
In June
2009, the FASB issued SFAS No. 166, “Accounting for Transfers of Financial
Assets – an amendment of FASB Statement No. 140”. SFAS No. 166 amends
SFAS No. 140, “Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities” by eliminating the concept of special-purpose
entity, requiring the reporting entity to provide more information about sales
of securitized financial assets and similar transactions, particularly if the
seller retains some risk to the assets, changes the requirements for the
de-recognition of financial assets, and provides for the sellers of the assets
to make additional disclosures. This Statement shall be effective as
of the Company’s first interim reporting period that begins after November 15,
2009. Earlier application is prohibited. The Company does not
anticipate any significant financial impact from adoption of SFAS No. 166. As of
September 30, 2009, SFAS No. 166 has not been added to the
Codification.
In May
2009, the FASB issued FASB ASC 855, “Subsequent Events”. This
Statement addresses accounting for and disclosure of events that occur after the
balance sheet date but before financial statements are issued or available to be
issued. FASB ASC 855 requires disclosure of the date through which an
entity has evaluated subsequent events and the basis for that date, the date
issued or date available to be issued. The Company adopted this
Statement in the second quarter of 2009. As a result the date through
which the Company has evaluated subsequent events and the basis for that date
have been disclosed in Note 12, Subsequent Events.
In April
2009, the FASB issued an update to FASB ASC 820, “Fair Value Measurements and
Disclosures”, related to providing guidance on when the volume and level of
activity for the asset or liability have significantly decreased and identifying
transactions that are not orderly. The update clarifies the
methodology to be used to determine fair value when there is no active market or
where the price inputs being used represent distressed sales. The
update also reaffirms the objective of fair value measurement, as stated in FASB
ASC 820, which is to reflect how much an asset would be sold in and orderly
transaction, and the need to use judgment to determine if a formerly active
market has become inactive, as well as to determine fair values when markets
have become inactive. The Company adopted this Statement in the
second quarter of 2009 without significant financial impact.
In April
2009, the FASB ASC 320, “Investments – Debt and Equity”, amends current
other-than-temporary guidance for debt securities through increased consistency
in the timing of impairment recognition and enhanced disclosures related to
credit and noncredit components impaired debt securities that are not expected
to be sold. Also, the Statement increases disclosures for both debt
and equity securities regarding expected cash flows, securities with unrealized
losses, and credit losses. The Company adopted this Statement in the
second quarter of 2009 without significant impact to our financial
statements.
In April
2009, the FASB issued an update to FASB ASC 825, “Financial Instruments”, to
require interim disclosures about the fair value of financial
instruments”. This update enhances consistency in financial reporting
by increasing the frequency of fair value disclosures of those assets and
liabilities falling within the scope of FASB ASC 825. The Company adopted this
update in the second quarter of 2009 without significant impact to the financial
statements.
In April
2009, the FASB issued an update to FASB ASC 805, “Business Combinations”, that
clarifies and amends FASB ASC 805, as it applies to all assets acquired and
liabilities assumed in a business combination that arise from
contingencies. This update addresses initial recognition and
measurement issues, subsequent measurement and accounting, and disclosures
regarding these assets and liabilities arising from contingencies in a business
combination. The Company adopted this Statement in the second quarter
of 2009 without significant impact to the financial statements.
23
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
1: Description of Business and Summary of Significant Accounting Policies
(Continued)
In
January 2009, the FASB issued an update to FASB ASC 325, “Investments – Other”,
which amends the impairments guidance on recognition of interest income and
impairment on purchased beneficial interests and beneficial interests that
continue to be held by a transferor in securitized financial assets to achieve
more consistent determination of whether an other-than-temporary impairment has
occurred. The update also retains and emphasizes the objective of another
than-temporary impairment assessment and the related disclosure requirements in
FASB ASC 320, “Investments – Debt and Equity Securities”, and other related
guidance. The adoption of this update in the second quarter of 2009
did not have a significant impact on the Company’s financial
statements.
In
November 2008, EITF issued new guidance under FASB ASC 350, “Intangibles –
Goodwill and Other” on accounting for defensive intangible
assets”. The new guidance applies to all acquired intangible assets
in which the acquirer does not intend to actively use the asset but intends to
hold (lock up) the asset to prevent its competitors from obtaining or using the
asset (a defensive asset). This guidance was adopted by the Company
in January 2009 without impact to the financial statements.
In May
2008, the FASB issued an update to FASB ASC 470, “Debt”, with respect to
accounting for convertible debt instruments that may be settled in cash upon
conversion including partial cash settlement. This update applies to
convertible debt instruments that, by their stated terms, may be settled in cash
(or other assets) upon conversion, including partial cash settlement, unless the
embedded conversion option is required to be separately accounted for as a
derivative under FASB ASC 815, “Derivatives and
Hedging”. Additionally, this update specifies that issuers of such
instruments should separately account for the liability and equity components in
a manner that will reflect the entity’s nonconvertible debt borrowing rate when
interest cost recognized in subsequent periods. The update is effective for
financial statements issued for fiscal years beginning after December 15, 2008,
and interim periods within those fiscal years. The Company does not
currently have any debt instruments for which this update would
apply. This update was adopted in January 2009 without significant
financial impact.
In March
2008, the FASB issued an update to FASB ASC 815, “Derivatives and Hedging” This
update is intended to enhance the current disclosure framework in FASB ASC
815. Under this update, entities will have to provide disclosures
about (a) how and why and entity uses derivative instruments, (b) how derivative
instruments and related hedged items are accounted for under FASB ASC 815 and
its related interpretations, and (c), how derivative instruments and related
hedged items effect an entity’s financial position, financial performance and
cash flows. This update is effective for all financial statements
issued for fiscal and interim periods beginning after November 15,
2008. The Company does not currently have any derivative instruments,
nor does it engage in hedging activities, therefore, the Company’s adoption of
this update in the first quarter of 2009 was without significant financial
impact.
In
December 2007, the FASB issued an update to FASB ASC 805, “Business
Combinations” which establishes principles and requirements for how an acquirer
recognizes and measures in its financial statements the identifiable assets
acquired, the liabilities assumed, any noncontrolling interest in the acquiree,
and the goodwill acquired. This update also establishes disclosure requirements
to enable the evaluation of the nature and financial effects of the business
combination. This update is effective for the Company with respect to business
combinations for which the acquisition date is on or after January 1, 2009.
The Company adopted this update in the first quarter of 2009 without significant
financial impact.
In
December 2007, the FASB issued an update to FASB ASC 810, “Consolidation”, which
establishes accounting and reporting standards for ownership interests in
subsidiaries held by parties other than the parent, the amount of consolidated
net income attributable to the parent and to the noncontrolling interest,
changes in a parent’s ownership interest, and the valuation of retained
noncontrolling equity investments when a subsidiary is deconsolidated. SFAS 160
also establishes disclosure requirements that clearly identify and distinguish
between the interests of the parent and the interests of noncontrolling owners.
This update is effective for the Company as of January 1, 2009. The Company
adopted this update in January 2009 without significant impact on the
consolidated financial position, results of operations, and
disclosures.
Fiscal Year
End
The
Company’s fiscal year end is December 31.
24
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
2: Going Concern
The
accompanying financial statements have been prepared on a going concern basis,
which contemplates the realization of assets and the satisfaction of liabilities
in the normal course of business. The Company has accumulated
consolidated net losses of $6,008,037 from the period September 17, 2007
(Inception) to December 31, 2009. The Company’s current liabilities
exceed its current assets by $1,889,395 as of December 31, 2009.
These
conditions give rise to substantial doubt about the Company’s ability to
continue as a going concern. These financial statements do not
include adjustments relating to the recoverability and classification of
reported asset amounts or the amount and classification of liabilities that
might be necessary should the Company be unable to continue as going
concern. The Company’s continuation as a going concern is dependent
upon its ability to obtain additional financing or sale of its common stock as
may be required and ultimately to attain profitability.
Management’s
plan, in this regard, is to raise financing of USD $5 Million through it a
preferred share private placement offering, which will be launched on May 1,
2010, which will pay a 9% paid in kind coupon and the preferred shares will
convert into common shares. The offering may also include warrants in
WorldVest. Management believes it will be able to successfully sell out the
USD $5 Million financing which should finance the growth through
profitability. However, there is no assurance that the Company will
be successful in raising such financing. As of the date of these
financial statements the Company has not secured a firm commitment under its
financing plan, but has opened the private placement to accredited investors and
institutions.
Note
3: Business Combinations
On June
22, 2009 and amended on August 19, 2009 we completed an agreement with our
parent company, whereby WorldVest Equity, Inc. to acquire its global banking and
advisory operations. As part of this agreement, we acquired Banking
and Advisory assets from WorldVest, LLC (“WVUSA”), a Nevada Company and 100% of
FutureVest Management (Shenyang) Co., Ltd. from WorldVest Equity, Inc. in
accordance with the terms and conditions of a contemporaneously executed and
delivered WorldVest, Inc. – WorldVest Equity, Inc. Purchase
Agreement.
As a
global merchant bank, WorldVest will focus on providing premier investment
banking, advisory and asset management services, as well as making direct
investments as a principal in select global transactions. WorldVest
will focus on two areas of business: Global Banking &
Advisory and Asset Management. WorldVest maximizes shareholder
value by creating synergies between its operating divisions, allowing us to
provide a full complement of services to a wide variety of clients while
choosing the highest caliber transactions to pursue as direct
investments.
As part
of the WorldVest asset and liability acquisition the Company acquired 20% of
Ascher Decision Services (“Ascher”) with an option to purchase the remaining 80%
of Ascher upon the final approval from FINRA. Additionally, the
Company acquired the rights to purchase 100% all current acquisition projects of
WorldVest, LLC, which included the LOI to purchase a Brazilian multiple license
bank, and a Brazilian retail company. In February 2008, WorldVest,
LLC paid $750,000 to an unrelated third party for the rights to acquire the
three entities above. As of December 31, 2009, WorldVest has not
formally closed on these transactions and the Company has recorded as deferred
acquisition costs, which is classified as other assets. Additionally,
the Company spent $124,500 in direct acquisition costs related to these entities
and have recorded that amount to deferred acquisition costs. On
December 31, 2009 due to the inability of WorldVest and Management of Ascher to
finalize their original agreement the 20% of Ascher was sold back to CCG for
$24,499 and the company took a $100,000 write off effective on December 31,
2009.
Note
4: Notes Receivable
Notes
receivable consisted of the following as of December 31, 2009 and December 31,
2008:
December
31,
|
December
31,
|
|||||||
2009
|
2008
|
|||||||
Notes
receivable, unrelated third party, unsecured, 12% interest, matures on
April 30, 2010, monthly payment of $7,500
|
$ | 27,931 | $ | - | ||||
$ | 27,931 | $ | - |
During
the year ended December 31, 2009 and 2008, the Company had interest income of
$14,379 and $0, respectively.
25
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
5: Property and Equipment
Fixed
assets consisted of the following as of December 31, 2009 and December 31,
2008:
December
31,
|
December
31,
|
|||||||
2009
|
2008
|
|||||||
Computer
equipment
|
$ | 18,085 | - | |||||
Furniture
and equipment
|
$ | 7,029 | - | |||||
Accumulated
depreciation
|
$ | (2,898 | ) | - | ||||
$ | 22,216 | - |
During
the year ended December 31, 2009 and 2008, the Company recorded depreciation
expense of $2,898 and $0, respectively.
Note
6: Notes Payable – Related Party
Notes
payable consisted of the following as of December 31, 2009 and December 31,
2008:
December
31,
|
December
31,
|
|||||||
2009
|
2008
|
|||||||
Notes
payable, related party, unsecured, 12% interest, matures on December 2010,
balloon payment of principal and interest.
|
$ | 829,762 | $ | 71,189 | ||||
Revolving
line of credit for up to $1,500,000 until December 31, 2012, related
party, unsecured, 12% interest, matures on December 31,
2012. Interest Payments Accrued.
|
$ | 957,959 | $ | - | ||||
Convertible
notes payable, related party, unsecured, 12% interest, matures on December
31, 2009, balloon payment of principal and interest, convertible into
common stock at a rate of $0.10 per share
|
$ | - | $ | 358,938 | ||||
$ | 1,787,721 | $ | 430,127 |
During
the year ended December 31, 2009 and 2008, the Company had interest expense of
$922,841 and $33,852, respectively, related to notes payable – related
party. As of December 31, 2009 and December 31, 2008, the Company had
accrued interest for notes payable of $119,680 and $10,533,
respectively.
Note
7: Preferred Shares (conversion of debenture)
On
December 31, 2009 WorldVest came to agreement with WorldVest Equity, Inc. to
convert its $6,000,000 9% Convertible Debenture into 4,000,000 new Preferred
Series B shares convertible into common stock, which continue to pay a 9% PIK
“Paid in Kind” Coupon through December 31, 2013 and 1,000,000 new Preferred
Series C non-equity shares that carry 100 common stock votes for each share
issued. These shares are issued to WV55 Partners as per
agreement.
26
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
8: Other Related Party Transactions
On
September 17, 2007, the Company hired Kenneth Green to serve as the President of
the Company. Mr. Green was to be paid an annual salary of
$400,000. Mr. Green was also to be paid an annual director’s fees of
$200,000. This agreement was cancelled upon the resignation of Mr.
Green on November 13, 2008.
On
September 17, 2007, the Company hired Patricia Hendricks to serve as the
Secretary and Treasurer of the Company. Ms. Hendricks was to be paid
an annual salary of $100,000. Ms. Hendricks was also to be paid an
annual director’s fees of $100,000. This agreement was
cancelled upon the resignation of Ms. Hendricks on November 13,
2008.
The Board
of Directors of the Company authorized payments to Mr. Green and Ms. Hendricks
of both the annual salary and director fees for years 2005, 2006 and
2007. Accordingly the Company accrued executive compensation totaling
$2,600,000 and the associated payroll taxes of approximately $82,055 through the
period ending March 31, 2008.
The
company paid Mr. Ken Green the sum of $29,210 for consulting services in the
period ended September 30, 2008 and the sum of $55,000 in the period ended
September 30, 2007. These sums were made prior to June 30, 2008 and
any ongoing fees relating to the agreements with Mr. Green and Ms. Hendricks
have been suspended as of June 30, 2008.
In 2008,
Mr. Green and Ms. Hendricks agreed to waive payment of the accrued compensation
of $2,600,000 and the Company classified this accrual and the related payroll
taxes of $82,055 as additional paid-in capital. On November 13, 2008,
Kenneth S. Green resigned as our President, Chief Executive Officer and Chairman
of the Board of Directors, and Patricia Hendricks resigned from her position as
our Secretary, Treasurer and member of the Board of Directors. Their
resignations were not the result of any disagreement with us on any matter
relating to our operations, policies and practices.
On March
8, 2008 the Company entered into a professional services contract with Catalyst
Financial Group, Inc. (“CFGI”) wherein for a term of five years CFGI will
provide the company with business development and executive corporate strategic
planning. The Company issued 5,000,000 of restricted common stock as
compensation for the services to be performed (see Note 9). Kenneth
Green is the Chief Executive Officer, director and shareholder of
CFGI. This contract was cancelled and the stock was returned to
the company as part of the return of 30,000,000 (See Note 9).
On
October 1, 2008, the Company entered into a one-year professional services
contract with majority shareholder WorldVest Equity, Inc. (WVE), WorldVest, LLC,
a wholly owned operating subsidiary of WorldVest Equity at that
time. WorldVest was to provide the Company with business development
and corporate strategic planning. The Company agreed to pay $10,000
per month to WorldVest, LLC pursuant to this contract. Garrett K.
Krause is the Executive Chairman of WorldVest Equity, Inc. and Managing Director
of WorldVest, LLC. As of September 30, 2009 this contract has been
cancelled.
On
November 30, 2008, the Company entered into a line of credit promissory note
with Zuma Investment Partners (Zuma), whereby Zuma paid a total of $3,500 on
behalf of the Company to various professionals for services
rendered. Interest of $379 has accrued on this note.
On
November 30, 2008, the Company entered into a line of credit promissory note
with WorldVest Equity, Inc., whereby WVE paid a total of $9,000 on behalf of the
Company to various professionals for services rendered. At the same
time, WVE extended an additional $10,000 to the Company within this line of
credit to cover short term operating expenses. As of September 30,
2009 WorldVest Equity is advanced a total of $591,446 to WorldVest and interest
of $18,079 has accrued on the advances.
On April
10, 2009 Mr. Garrett K. Krause agreed to a consulting contract whereby he was
paid a minimum of $25,000 for the 3 month period in order to execute the
WorldVest, Inc. merchant banking plan on behalf of the new majority shareholder
WorldVest Equity, Inc. This agreement was amended and Mr. Krause
agreed to receive a base salary of $114,906 for 2009 and $120,000 for
2010.
Pursuant
to the June 22, 2009 transaction to acquire the Global Banking & Advisory
assets, WorldVest Equity, Inc. was issued a 9% $6,000,000 convertible debenture
that converts into 4,000,000 shares of stock and includes warrants to purchase
4,000,000 shares of stock at $3.00 per share.
27
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
8: Other Related Party Transactions (Continued)
On
December 31, 2009 WorldVest Equity, Inc. agreed to convert its $6,000,000
Convertible Debenture into 4,000,000 9% Preferred Series B Shares and 1,000,000
Preferred Series C shares that carry no equity but have 100 common share votes
for each share issued.
On
December 31, 2009 WorldVest Equity agreed to acquire $107,106 in Notes
Receivable from FaceKoo Limited in payment of accrued interest owed and Notes
Payable owed by FutureVest Management (Shenyang) Co. Ltd. This
transaction provides for no future recourse to FutureVest Management (Shenyang)
Co. Ltd or its parent company, WorldVest, Inc.
On
December 31, 2009 Corporate Capital Group, LLC agreed to acquire the 20% equity
shares in Ascher Decision Services, Inc plus the $9,499 in current notes
receivable owed by Ascher Decision Services, Inc. for a total amount of $21,499
which was applied against the Notes Payable owed to Corporate Capital Group by
WorldVest, Inc.
On
December 31, 2009 Corporate Capital Group, LLC agreed to acquire a Note
Receivable of $7,040 owed by Mr. Peter Dunev from WorldVest, Inc. and agreed to
acquire the debts owed to Stockpicks.com Corporation and DealFlow Media of $475
and $7,500 respectively. These transactions will have no recourse to WorldVest,
Inc.
Note
9: Equity
On
September 17, 2007, the Company issued 55,000,000 shares of restricted stock in
exchange for consulting services rendered valued at $55,000. The
common stock was issued to entities that are controlled and owned by the
company’s former Chief Executive Officer. The shares were valued at
the fair value of the services.
On
September 30, 2007, the Company issued 47,000 shares of its common stock in
exchange for a subscription receivable of $47,000. On October 3,
2007, the Company received $47,000 and reduced its subscription receivable
balance.
In
December 2007, the Company received $34,250 in payment of subscriptions for
34,250 shares of common stock. As the shares of common stock were
issued January 18, 2008, the Company recorded a common stock payable for the
$34,250 on December 31, 2007.
On
January 18, 2008 the Company issued 22,500 shares of its Common stock for 22,500
in cash.
On June
9, 2008 the company cancelled 20,000,000 shares pursuant to the cancellation of
the consulting contracts (see Note 8).
On June
19, 2008, the Company received $50,000 in payment for 50,000 shares of
unrestricted common stock. As the shares were issued in July 2008, the Company
recorded the $50,000 as a common stock payable.
On July
25, 2008 the Company Issued 50,000 shares in satisfaction of common stock
payable totaling $50,000.
On August
13, 2008 the company cancelled 10,000,000 shares pursuant to the cancellation of
the consulting contracts (Note 8).
On
December 31, 2009 the company issued 155,852 shares of its Commons stock for
$233,760 in cash.
On
December 31, 2009 the company issued 3,670,000 shares to ZumaHedgeFund, LLC for
conversion of $367,000 outstanding Notes Payable of $367,000 to ZumaHedgeFund,
LLC.
On
December 31, 2009 the company agreed to issue 189,696 common shares to WorldVest
Equity, Inc. in order to pay the accrued interest of $284,544 due for the
convertible debenture through December 31, 2009.
On
December 31, 2009 the company issued 4,000,000 9% Preferred Class B shares
convertible into 4,000,000 shares of common stock in exchange for cancellation
of the $6,000,000 9% convertible debenture issued to WorldVest Equity,
Inc. This transaction also called for the issuance of 1,000,000
Preferred Class C non-equity shares that carry 100 common share votes for each 1
share issued.
Pursuant
to a stock purchase agreement as of September 18, 2008, Catalyst Holding Group,
LLLP, an entity owned by the Company’s former Chief Executive Officer,
transferred 51,000,000 shares of the Company’s common stock to Wilmington
Rexford International, Inc. for a price of twenty thousand dollars
($20,000). On November 13, 2008, Wilmington Rexford International,
Inc, assigned 20,000,000 shares of the common stock to Wilmington WorldVest
Partners, 20,000,000 shares to CaboWest Group, Inc. and 11,000,000 shares to
Javalon Investment Partners. The total of 51,000,000 shares represents 92.47% of
our issued and outstanding common stock. Garrett K Krause is the beneficial
owner of Wilmington WorldVest Partners, Inc., CaboWest, and Javalon Investment
Partners.
28
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
9: Equity (Continued)
On April
9, 2009 51,000,000 shares of our common stock held by Wilmington WorldVest
Partners (20,000,000 shares), CaboWest Group, Inc. (20,000,000 shares) and
Javalon Investment Partners (11,000,000 shares) have been transferred to
WorldVest Equity, Inc., a global Merchant Bank for a price of three hundred
thousand dollars ($300,000). WorldVest Equity will own a total of
51,000,000 shares representing 91.9% of our issued and outstanding common
stock. Garrett K. Krause is the Executive Chairman of WorldVest
Equity, Inc. and will be deemed a beneficial owner of 70% of the fully diluted
WorldVest Equity, Inc. stock through investment companies and trusts for which
Garrett K. Krause is either Executive Chairman and/or Managing
Director.
On June
22, 2009, the Company issued 4,000,000 warrants in conjunction with a
convertible debenture for $6,000,000. The fair value of the warrants
and the beneficial conversion feature totaled $2,941,773 and was recorded to
additional paid in capital. Based on the early conversion of this
convertible debenture the company recorded a reversal to the beneficial
conversion in the amount of $2,503,636.
Note
10: Warrants
The
following is a summary of the status of all of the Company’s stock warrants as
of December 31, 2009 and changes during the year ended on that
date:
Number
Of Warrants
|
Weighted-Average
Exercise Price
|
|||||||
Outstanding
at January 1, 2009
|
- | $ | 0.00 | |||||
Granted
|
4,000,000 | $ | 3.00 | |||||
Exercised
|
- | $ | 0.00 | |||||
Cancelled
|
- | $ | 0.00 | |||||
Outstanding
at December 31, 2009
|
4,000,000 | $ | 3.00 | |||||
Warrants
exercisable at December 31, 2009
|
4,000,000 | $ | 3.00 | |||||
Warrants
exercisable at December 31, 2008
|
- | $ | 0.00 |
The
following tables summarize information about stock warrants outstanding and
exercisable at December 31, 2009:
STOCK
WARRANTS OUTSTANDING
|
||||||||||||||
Exercise
Price
|
Number of
Warrants Outstanding
|
Weighted-Average Remaining Contractual Life in
Years
|
Weighted-Average Exercise Price
|
|||||||||||
$ | 3.00 | 4,000,000 | 1.72 | $ | 3.00 | |||||||||
4,000,000 | 1.72 | $ | 3.00 |
STOCK
WARRANTS EXERCISABLE
|
||||||||||
Exercise
Prices
|
Number
of Shares Exercisable
|
Weighted-Average
Exercise Price
|
||||||||
$ | 3.00 | 4,000,000 | $ | 3.00 | ||||||
4,000,000 | $ | 3.00 |
29
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
11: Commitments and Contingencies
On
December 5, 2007 and March 8, 2008 the Company entered into six contracts to
provide professional services in return for 20,000,000 and 10,000,000 shares of
restricted common stock respectively, including 5,000,000 shares of restricted
common stock issued to Catalyst Financial Group, Inc., (see Note
8). All of the agreements have been assigned an effective date
concurrent with the date of issuance of the stock, which is March 18,
2008. The stock has been valued at $.75 (seventy five cents) per
share, as the estimated fair market value of the common
stock. Accordingly on March 18, 2008, $22,500,000 in prepaid
professional fee contracts was recorded on the books of the
Company. The prepaids were to be amortized over the lives of the
contracts, which bear either one year or five years terms. As of this
time all six contracts have been cancelled and the 30,000,000 shares have been
returned to treasury.
On June
9, 2008 the Company cancelled four of the six contracts to provide professional
services and the stock certificates for 20,000,000 shares of the restricted
common stock, which represented all of the stock issued for those contracts,
were also cancelled and returned to the Company. The related prepaid
professional fees recorded on the books of the Company of $15,000,000 less
$576,613 of the prepaid professional fees which were amortized and expensed as
of the period ended March 31, 2008, have been reversed on the books of the
Company as of June 30, 2008. The agreements provide for the
development and implementation of advertising and marketing programs and
concurrent efforts at business development.
On August
13, 2008 the Company cancelled the remaining two of the six contracts to provide
professional services and the stock certificates for 10,000,000 shares of the
restricted common stock, which represented all of the stock issued for those
contracts, were also cancelled and returned to the Company. The
agreements provide for the development and implementation of advertising and
marketing programs and concurrent efforts at business development.
Note
12: Subsequent Events
On February 19,
2010, The
Company announced today the formation and launch of Hurricane Global Resource
Corporation (“Hurricane”) as a platform development
subsidiary. Hurricane will engage in global trading of in-demand
resources between high growth markets such as Latin America and Asia and will
seek to secure continuous long-term supply through strategic acquisitions in a
diversified slate of natural resource projects.
The
Company will independently manage all Hurricane operations through a dedicated
team of professionals experienced in acquisition, development and management of
global resource properties. With an extensive worldwide network of
resources, The Company is confident in its ability to transform its current
slate of resource M&A targets into long-term global supplies and strong
revenue growth.
Hurricane’s
launch coincides with the signing of a Letter of Intent with a large Chinese
steel manufacturer with a government approved import license seeking a long-term
iron ore supply with an initial monthly requirement of up to 1.2 million metric
tons. In order to fulfill this long-term demand, Hurricane has entered
into negotiations for the acquisition of two properties, each estimated to
contain significantly more than 500 million tons of iron ore reserves. In
the near term, Hurricane’s objective is to finalize a long-term purchase
contract based on terms of LOI and to secure internal supply through the
completion of at least one of its two acquisition targets. In the
near term, Hurricane anticipates securing multiple short-term Brazilian iron ore
supplies and brokering initial shipments to China immediately creating positive
cash flow.
In
addition to these initial two iron ore investment targets, Hurricane has
identified a Brazilian sustainable forestry management project and a significant
U.S. based potash reserve each representing unique and attractive growth
opportunities. Collectively, management believes that Hurricane can
consolidate these and other future resource opportunities creating a diversified
and lucrative asset portfolio, ultimately positioning Hurricane for an
independent public listing of its common shares on a major
exchange.
On February
23, 2010, The Company
consolidated of all
finance subsidiary operations in the United States, Brazil and China under new
wholly owned subsidiary, WorldVest Financial Corporation (“WV Financial”), which
is strategically positioned to immediately capitalize on growth opportunities in
these and other global financial markets. The Company will continue
implementing the focused growth of WV Financial, while simultaneously building
its platform development companies, WorldVest Korea Group and Hurricane Global
Resources Corporation, through its equity development & asset management
subsidiary, WorldVest Partners.
30
WorldVest,
Inc.
(A
Development Stage Company)
(formerly
Catalyst Ventures Incorporated)
Notes
to Combined Financial Statements
Note
12: Subsequent Events (Continued)
WV
Financial will seek to achieve significant growth within the Brazilian banking
& finance sector with the pending launch of WorldVest Brasil Finance FIDC, a
securitized credit receivables fund aimed at deploying capital into the
Brazilian consumer finance and credit card markets. WV Financial will
also work toward finalizing the acquisition of a Brazilian multiple license
commercial and investment bank, currently under Letter of Intent.
Additionally,
WV Financial anticipates accelerated growth in its Chinese deal flow through its
wholly owned Chinese financial advisory subsidiary, FutureVest Management
(Shenyang) Co. Ltd., dba. China WorldVest Advisors, and the continued expansion
of its U.S. corporate finance & advisory business. Further, WV
Financial looks to pursue additional banking & finance related M&A
opportunities in the United States and Brazil.
On March 30, 2010,
The Company’s to be formed subsidiary Hurricane Global Resource Corporation
signed a Joint Venture to launch its Chinese Iron Ore Sales Office in Tianjin,
China. Simultaneously, Hurricane announced the addition of Qianli Ma,
as its Managing Director in charge of negotiating and managing all Hurricane
relationships with the Chinese steel industry. Mr. Qianli Ma has
extensive experience and far-reaching relationships within this industry as well
as within the state and federal governments of China.
Through
the addition of its Chinese Sales office, Hurricane has begun assembling a
consortium of steel producers seeking to secure long-term supplies of iron
ore. In partnership with these buyers, Hurricane is currently
evaluating opportunities to invest in and develop global reserve assets into
producing iron ore mines for the benefit of the consortium. While pursuing its
long-term mineral acquisition and development endeavors, Hurricane has begun
sourcing interim supply and plans to broker iron ore transactions on behalf of
its buyers.
On April 5, 2010, The Company’s to be
formed subsidiary Hurricane Global Resource Corporation (“Hurricane”), announced
today that it has secured its first iron ore purchase contract from a prominent
Chinese commodities import and trading company (the “Buyer”). Through
this contract, the Buyer has agreed to purchase up to 12 million tonnes of iron
ore annually from Hurricane, with an annual current market value of $1.4 billion
USD. Through its broad relationships in Latin America, Hurricane has
begun sourcing available iron ore supplies to fulfill this contract with
long-term plans to acquire and develop into production a slate of Hurricane
owned iron ore reserve properties.
Initially,
Hurricane has contracted with its first iron ore producer to fulfill
approximately 20% of the annual contract volume. Subsequently, the
Buyer has accepted and signed a “Supplier Addendum”, pursuant to the terms of
the purchase contract, accepting the specifications of this initial iron ore
supply. Pending a mine site visit by the Buyer, the first monthly
shipment of 70,000 tonnes is scheduled to occur within a period of 45 days, with
monthly volumes increasing to 150,000 tonnes in the third month and 300,000
tonnes by the eighth month. The contract calls for a total first year
delivery volume of 2,390,000 tonnes at a value of $286,800,000.
31
ITEM
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
Our accountant is L.L. Bradford & Company,
LLC, CPAs, independent certified public accountants. We do not presently intend
to change accountants. At no time have there been any disagreements with such
accountants regarding any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure.
ITEM
9A(T). CONTROLS AND PROCEDURES
Evaluation
of Disclosure Controls and Procedures
Pursuant
to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”),
the Company carried out an evaluation, with the participation of the Company’s
management, including the Company’s Chief Executive Officer (“CEO”) and Chief
Financial Officer (“CFO”) (the Company’s principal financial and accounting
officer), of the effectiveness of the Company’s disclosure controls and
procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the
end of the period covered by this report. Based upon that evaluation, the
Company’s CEO and CFO concluded that the Company’s disclosure controls and
procedures are not effective to ensure that information required to be disclosed
by the Company in the reports that the Company files or submits under the
Exchange Act, is recorded, processed, summarized and reported, within the time
periods specified in the SEC’s rules and forms, and that such information is
accumulated and communicated to the Company’s management, including the
Company’s CEO and CFO, as appropriate, to allow timely decisions regarding
required disclosure.
Management's
Annual Report on Internal Control Over Financial Reporting.
The
management of the Company is responsible for establishing and maintaining
adequate internal control over financial reporting for the
Company. Our internal control system was designed to, in general,
provide reasonable assurance to the Company’s management and board regarding the
preparation and fair presentation of published financial statements, but because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation
of effectiveness to future periods are subject to the risk that controls may
become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.
Our
management assessed the effectiveness of the Company’s internal control over
financial reporting as of December 31, 2009. The framework used by
management in making that assessment was the criteria set forth in the document
entitled “ Internal Control – Integrated Framework” issued by the Committee of
Sponsoring Organizations of the Treadway Commission. Based on that assessment,
our management has determined that as of December 31, 2009, the Company’s
internal control over financial reporting was not effective for the purposes for
which it is intended.
This
annual report does not include an attestation report of the Company’s registered
public accounting firm regarding internal control over financial reporting.
Management's report was not subject to attestation by the Company's registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit the Company to provide only management's report
in this annual report.
Changes
in Internal Control over Financial Reporting
No change
in our system of internal control over financial reporting occurred during the
period covered by this report, fourth quarter of the fiscal year ended December
31, 2009, that has materially affected, or is reasonably likely to materially
affect, our internal control over financial reporting.
ITEM
9B. OTHER INFORMATION
On
December 22, 2009, the Company issued 155,843 shares of its restricted common
shares to eight (8) accredited investors in exchange for $233,760 in
cash.
We
believe the issuance of the shares is exempt from the registration and
prospectus delivery requirement of the Securities Act of 1933 by virtue of
Section 4(2) and/or Regulation D, Rule 506. The shares were issued
directly by us and did not involve a public offering or general
solicitation. The recipients of the shares were afforded an
opportunity for effective access to our files and records of that contained the
relevant information needed to make their investment decision, including our
financial statements and 34 Act reports. We reasonably believed that the
recipients had such knowledge and experience in the Company’s financial and
business matters that they were capable of evaluating the merits and risks of
his investment.
On
December 31, 2009, the Company converted $6,000,000 of the principal and
interest due under the 9% Convertible Debenture issued by WorldVest Equity, Inc.
dated June 22, 2009, into the following securities:
a.
|
Four
million (4,000,000) shares of Series B Convertible Preferred Shares
carrying a 9% interest coupon to be Paid in Kind with each share
convertible into one share of the common stock of the
Company. The shares will be issued to WV55
Partners;
|
b.
|
1,000,000
Series C Non-Equity Preferred Shares that carry 100 common stock votes for
each Series C Preferred Share Issued. The shares will be issued
WV55 Partners; and
|
c.
|
All
accrued interest on the debentures through December 31, 2009, amounting to
$284,544, will be paid with WorldVest, Inc. common stock at a price of
$1.50 per share resulting in the future issuance of 189,696 common
shares.
|
We
believe the issuance of the shares is exempt from the registration and
prospectus delivery requirement of the Securities Act of 1933 by virtue of
Section 4(2) and/or Regulation D, Rule 506. The shares were issued
directly by us and did not involve a public offering or general
solicitation. The recipients of the shares were afforded an
opportunity for effective access to our files and records of that contained the
relevant information needed to make their investment decision, including our
financial statements and 34 Act reports. We reasonably believed that the
recipients had such knowledge and experience in the Company’s financial and
business matters that they were capable of evaluating the merits and risks of
his investment.
32
PART
III
We have
Directors and Executive Officers as follows:
NAME
|
AGE
|
POSITION
|
||
Garrett
K. Krause
|
44 |
CEO/Chairman
|
||
Michael
R. Carney
|
26 |
Vice
President, Banking & Global Business Development
|
||
Conrad
C. Chase
|
27 |
Vice
President, Operations
|
||
Richard
Whalen
|
49 |
Independent
Director
|
The
business background description of the officers and directors:
Mr. Garrett K. Krause,
CEO/Chairman: For over 25 years, Garrett K. Krause has been a successful
entrepreneur, dealmaker, venture banker and investor with active participation
in over 50 global transactions in both private and public companies in domestic
and international markets. A true entrepreneur, at the age of 18, Mr. Krause was
on the cutting edge of the 1980’s software explosion as the inventor of a first
generation PC based retail inventory point of sale system. In 1988, Mr. Krause
sold his software technology to the world’s leading cash register manufacturer
NCR, and has spent the ensuing 21 years providing "smart capital" and “strategic
entrepreneurial advisory” as an integral part of many global ventures. One of
these ventures was as an early investor in small public Canadian oil and gas
Company, which grew from the point of near bankruptcy, producing only 60 barrels
of oil a day, to become one of the largest independent oil producers in Canada,
eventually listing on the NYSE and ultimately selling to the Chinese government
in 2005 for over $4 billion. It was through this transaction and the
subsequent business relationships in China that had led to WorldVest securing
its rare, independent, Chinese business license now operating as FutureVest
Management (Shenyang) Co. Ltd.
Mr.
Krause's career as a lead investor, principal, banker and consultant has
provided a unique experience and viewpoint for operating in today's
ever-convergent global business world. These views have been
incorporated as a driving force in the overall vision and successful creation of
WorldVest, its Banking and Finance Subsidiary and initial and developing
Platform Development Companies. Mr. Krause is currently Managing
Director of WorldVest Equity, Inc. (OTC: WVVEF) and Wilmington Rexford
International, Inc. Mr. Krause also sits as a Director of Barotex
Technology Corporation (OTC: BARX) as well as the boards of many other private
companies. Mr. Krause studied finance and accounting at the
University of Calgary, Canada and currently lives in Malibu, CA with his wife
and 2 daughters.
Disclosure:
In 1994 Mr. Krause made a $300,000 investment in a company located in Las Vegas,
Nevada and due to some previous issues with the original company founder not
disclosed within the transaction, subsequent legal action was taken and Mr.
Krause was included as a second defendant. Several years later, the
lawsuit became dormant due to the death of the principal
defendant. Mr. Krause wrongly took the assumption that his lawyer had
the case dismissed. In 1997, the plaintiff went to court and obtained
a $30 million default judgment against Mr. Krause personally by serving him at a
previous address. After becoming aware of the personal judgment
against him in late 1999, Mr. Krause’s spent several years and almost a half
million dollars in legal fees fighting through the Nevada court system seeking
his day in court. Mr. Krause and his counsel heavily disputed the
allegations, findings and facts, which led to the default
judgment. In October of 2005 at the advice of his legal counsel, Mr.
Krause filed personal Bankruptcy in an effort to move the case from local Nevada
courts to the Federal Bankruptcy Court where he felt he would finally be granted
a hearing and an opportunity to dispute the merits of the
judgment. In the first hearing on this case the Bankruptcy Judge
dismissed the judgment with prejudice and the case and Mr. Krause’s Bankruptcy
was immediately discharged. This decision held up on appeal and the
case was settled for $250,000 before final the results of the Appeal to the
Supreme Court could be heard.
Mr. Michael Carney, Executive Vice
President: Mr. Carney has been instrumental the early development of
WorldVest as a global merchant bank. Paramount among his accomplishments has
been the development of the WorldVest retail syndication network and the
Company’s business development efforts throughout Asia. Mr. Carney
brings substantial experience in transactional due diligence, structuring and
capital syndication. Prior to joining WorldVest, Mr. Carney worked with Castle
Arch Real Estate Investment Company, a Los Angeles based private equity real
estate development firm, where he was responsible for developing sales,
marketing, and investor education campaigns targeted to high net worth
investors. Previously, Mr. Carney spent one year working for the Kyunggido
Provincial Ministry of Education in Seoul, South Korea while learning
conversational Korean. Mr. Carney earned a B.S. in Chemical
Engineering from the University of California-Santa Barbara.
33
Mr. Conrad Chase, Executive Vice
President: Mr. Chase is responsible for raising investment capital,
sourcing investment opportunities, and attracting strategic global partners to
the Company. As an indication of his entrepreneurial mettle, Mr.
Chase successfully started and profitably sold two businesses while college in
order to finance his college education. Early in his career, Mr. Chase spent one
year working for the Kyunggido Provincial Ministry of Education in Seoul, South
Korea while learning conversational Korean. Mr. Chase also is also
multi-lingual with conversational fluency in Portuguese, Spanish and
Italian. After returning to the U.S., Mr. Chase was responsible for
developing sales, marketing, and investor education campaigns to high net worth
investors for Castle Arch Real Estate Investment Co., a Los Angeles based
private equity & real estate development firm. Mr. Chase earned a B.S. in
International Studies from the University of Wisconsin-Madison.
Mr. Richard T. Whelan, Independent
Director: Mr. Whelan is the Senior Managing Partner of Alexis Global
Investors an international asset management company headquartered in New York
City. In this role he is responsible for overseeing the general
operations of the company including leading all fund raising efforts, validating
all transactional due diligence and approving each capital
deployment. Mr. Whelan’s extensive experience with multi-billion
dollar companies and projects coupled with his management and leadership
experience have and will continue to translate into success within each role he
occupies and bring immeasurable value to the WorldVest team.
Through a
20 year career as a United States Naval Supply Officer and 5 years as a civilian
consultant specializing in financial management, Richard T. Whelan has built a
reputation for integrity, attention to detail, and execution under demanding
circumstances. Upon graduating from the United States Naval Academy
with a B.S. in Mechanical Engineering and throughout his Naval career he was the
recipient of numerous awards and honors for outstanding
performance. Throughout this distinguished career, including numerous
combat and non-combat deployments, Mr. Whelan excelled in the areas of personnel
management, financial management, procurement, logistics, and facilities
support. While in the Navy, he continued his education receiving a
MBA from San Diego State University. Since retiring from the Navy in
2003, Mr. Whelan has held many high-level consultant positions for both the US
government and large private corporations in the defense industry.
Most
recently, prior to the formation of Alexis Global, Mr. Whelan was a Deputy
Director, with Raytheon Technical Services Company, as part of the ITAM-Army
Support Operations and Multi-National Security Transition Team in
Iraq. In this role, he was responsible for supervising procurement
and construction initiatives designed to generate and train Iraqi Army units at
13 Division Level Location Commands located throughout Iraq.
Mr.
Whalen has managed numerous multi-billion dollar budgets in his career
including:
·
|
Provided
systems analysis for $2 billion USD Iraqi Security Force Funds (ISFF) and
a $2.6 billion Foreign Military Sales (FMS) Program including projects in
construction, communications infrastructure, military force generation,
and strategic security.
|
·
|
Supported
the strategic initiatives within the Iraqi Ministry of Defense annual
budget of $5.1 billion USD by working to integrate the processes of
Requirements Generation, Budget Formulation, Acquisition, Life Cycle
Management, and Financial
Management.
|
·
|
Project
Manager for $1 billion USD Navy Global Contingency Construction
Contract
|
·
|
Project
Manager for $9 billion USD Army Field & Readiness Support Team
Contract
|
·
|
Provided
Planning, Programming, Budgeting & Execution System (PPBES) inputs for
supporting Operations & Maintenance of 23 operational satellites from
6 Satellite Comm. (SATCOM) programs with a total book value of
$3.5 billion
|
There are
no agreements or understandings for an officer or director to resign at the
request of another person and the above-named officer and director is not acting
on behalf of nor will act at the direction of any other person.
Term of
Office
Our
directors are appointed for a one-year term to hold office until the next annual
general meeting of our shareholders or until removed from office in accordance
with our bylaws. Our officers are appointed by our board of directors and hold
office until removed by the board.
All
officers and directors listed above will remain in office until the next annual
meeting of our stockholders, and until their successors have been duly elected
and qualified. There are no agreements with respect to the election of
Directors. We have not compensated our Directors for service on our Board of
Directors, any committee thereof, or reimbursed for expenses incurred for
attendance at meetings of our Board of Directors and/or any committee of our
Board of Directors. Officers are appointed annually by our Board of Directors
and each Executive Officer serves at the discretion of our Board of Directors.
We do not have any standing committees. Our Board of Directors may in the future
determine to pay Directors’ fees and reimburse Directors for expenses related to
their activities.
34
None of
our Officers and/or Directors have filed any bankruptcy petition, been convicted
of or been the subject of any criminal proceedings or the subject of any order,
judgment or decree involving the violation of any state or federal securities
laws within the past five (5) years.
Audit
Committee
We do not
have a standing audit committee of the Board of Directors. Management has
determined not to establish an audit committee at present because of our limited
resources and limited operating activities do not warrant the formation of an
audit committee or the expense of doing so. Besides the services of
Mr. Garrett Krause, we do not have a financial expert serving on the Board of
Directors or employed as an officer based on management’s belief that the cost
of obtaining the services of a person who meets the criteria for a financial
expert under Item 401(e) of Regulation S-B is beyond its limited financial
resources and the financial skills of such an expert are simply not required or
necessary for us to maintain effective internal controls and procedures for
financial reporting in light of the limited scope and simplicity of accounting
issues raised in its financial statements at this stage of its
development.
Involvement in Certain Legal
Proceedings
To our
knowledge, during the past five (5) years, none of our directors, executive
officers, promoters, control persons, or nominees has been:
·
|
the
subject of any bankruptcy petition filed by or against any business of
which such person was a general partner or executive officer either at the
time of the bankruptcy or within two years prior to that
time;
|
·
|
convicted
in a criminal proceeding or is subject to a pending criminal proceeding
(excluding traffic violations and other minor
offenses);
|
·
|
subject
to any order, judgment, or decree, not subsequently reversed, suspended or
vacated, of any court of competent jurisdiction, permanently or
temporarily enjoining, barring, suspending or otherwise limiting his
involvement in any type of business, securities or banking activities;
or
|
·
|
found
by a court of competent jurisdiction (in a civil action), the Commission
or the Commodity Futures Trading Commission to have violated a federal or
state securities or commodities
law.
|
Compliance With Section
16(A) Of The Exchange Act
Section
16(a) of the Exchange Act requires the Company’s officers and directors, and
persons who beneficially own more than 10% of a registered class of the
Company’s equity securities, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission and are required to
furnish copies to the Company. To the best of the Company’s knowledge, any
reports required to be filed were timely filed in fiscal year ended December 31,
2008.
Auditors; Code of Ethics;
Financial Expert
We do not
have an audit committee financial expert. We do not have an audit
committee financial expert because we believe the cost related to retaining a
financial expert at this time is prohibitive. Furthermore, because we
are only beginning our commercial operations, at the present time, we believe
the services of a financial expert are not warranted.
Potential Conflicts of
Interest
We are
not aware of any current or potential conflicts of interest with any of our
executives or directors.
35
ITEM
11. EXECUTIVE COMPENSATION
Compensation of Executive
Officers
The
following summary compensation table sets forth all compensation awarded to,
earned by, or paid to the named executive officers paid by us during the fiscal
years ended December 31, 2009 and 2008 in all capacities for the accounts of our
executives, including the Chief Executive Officer (CEO) and Chief Financial
Officer (CFO):
SUMMARY
COMPENSATION TABLE
Name
and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Stock
Awards
($)
|
Option
Awards
($)
|
Non-Equity
Incentive Plan Compensation ($)
|
Non-Qualified Deferred Compensation Earnings($) |
All
Other Compensation
($)
|
Totals
($)
|
|||||||||||||||||||||||||
Garrett K. Krause | 2009 | $ | 114,905 | 0 | 0 | 0 | 0 | 0 | 0 | $ | 114,905 | |||||||||||||||||||||||
President, Chief | 2008 | $ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | $ | 0 | |||||||||||||||||||||||
Executive Officer, | ||||||||||||||||||||||||||||||||||
Chief
Financial Officer
|
||||||||||||||||||||||||||||||||||
Conrad
Chase
|
2009
|
$ | 47,500 | 0 | 0 | 0 | 0 | 0 | $ | 47,500 | ||||||||||||||||||||||||
Vice
President
|
2008
|
$ | 0 | 0 | $ | 0 | ||||||||||||||||||||||||||||
Michael
Carney
|
2009
|
$ | 49,750 | 0 | 0 | 0 | 0 | 0 | $ | 49,750 | ||||||||||||||||||||||||
Vice
President
|
2008
|
$ | 0 | 0 | $ | 0 | ||||||||||||||||||||||||||||
Kenneth
Green
|
2009
|
$ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | $ | 0 | |||||||||||||||||||||||
Ex.
Chairman, & CEO
|
2008
|
$ | 150,000 | 0 | 0 | 0 | 0 | 0 | 0 | $ | 150,000 | |||||||||||||||||||||||
Patricia
Hendricks,
Ex.
Secretary,
|
2009
|
$ | 0 | 0 | 0 | 0 | 0 | 0 | 0 | $ | 0 | |||||||||||||||||||||||
Treasurer,
& Director
|
2008
|
$ | 50,000 | 0 | 0 | 0 | 0 | 0 | 0 | $ | 50,000 |
Forward Executive
Compensation Overview
In order
to serve the best interests of shareholders, the Company follows an executive
compensation philosophy that emphasizes Performance-Based
Compensation, which will be evaluated and adjusted on an annual basis by
the Company’s Board of Directors. In determining compensation in
2010, the Company has considered measures of performance as it directly relates
to positive earnings for the Company. In the future, the Company may
adapt additional metrics similar to those of like companies in our space, which
may include increased earnings per share, increased return on equity, or
specific performance benchmarks agreed upon by the Company’s senior management
and the Board of Directors. The terms of the 2010 Executive
Compensation are detailed below, and outlined in each executive officer’s
(“Management”) Compensation Agreement dated January 1, 2010.
For the
fiscal year 2009, the Company failed to generate Positive Earnings, and as such,
no bonuses or incentives under this plan were paid to Management.
Executive
officers receive annual total compensation comprised of base salary, and both
cash and equity incentive compensation. Base salaries are intended to be a small
portion of the total compensation with regards to the types of compensation
available for Management. Additionally, the Company believes that the
best way to align the interests of executive management with those of the
Company’s shareholders is to ensure that WorldVest stock represents a
substantial portion of their compensation. Per the compensation
agreements signed with the Company, Management receives the following types of
compensation: Salary, cash Bonus, stock bonus.
Executive
Salaries:
Salaries
are set at the beginning of the year by the Company. Salaries for each executive
officer aside from the CEO shall be set by the CEO. The current base
cash salary for the CEO was agreed to be $120,000 and the 2 current Executive
Vice Presidents will be paid a base salary of $54,000 per year
36
Cash
Bonus:
The
Company has established a “bonus matrix” which calls for distributions of the
Company’s net earnings, based upon the Company achieving predetermined benchmark
levels of profitability. In principal, as the net earnings of the
Company increase, so does the bonus allocated to senior
management. The executive cash bonus for the year 2010 has not been
set at this time.
Stock
Bonus:
In
addition to the cash bonus mentioned above, Officers shall receive 5-year
WorldVest stock options (“Options”). Options issued shall originate
from the 2010 stock option bonus allowance, and shall be allocated for year-end
bonuses at a predetermined strike price, which is the trading price on December
31, 2009. Option holders may execute their Options anytime prior to
their expiration date. Additionally, any converted stock that is sold
is subject to a “trickle out” provision in accordance with Rule 144 of the
Securities and Exchange Commission. At this time no final Stock
Option Bonuses have been determined
The
following table sets forth each person known by us to be the beneficial owner of
five percent or more of the Company's Common Stock, all directors individually
and all directors and officers of the Company as a group. Except as noted, each
person has sole voting and investment power with respect to the shares
shown.
Name
and Address of
Beneficial
Owner
|
Amount
of
Beneficial
Ownership
|
Percentage
of
Class
|
||
WV55
Partners (1)
295
Madison Ave., 12th
Floor
New
York, NY, 10067
|
45,000,000
|
76.19%
|
||
Conrad
Chase
|
50,000
|
0.001%
|
||
Michael
Carney
|
50,000
|
0.001%
|
||
All
Executive Officers and Directors as a Group
|
45,100,000
|
76.21%
|
||
(1)
|
Garrett
K. Krause is the Managing Director WV55 Partners and therefore is
considered the beneficial owner of the shares as a group. The
equity of WV55 Partners is held by a diverse group of international
investors.
|
ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
On April 9, 2009, Wilmington WorldVest Partners,
CaboWest Group, and Javalon Investment Partners sold an aggregate 51,000,000
shares of Catalyst Ventures common stock to WorldVest Equity, Inc., a British
Virgin Islands Holding Company for a price of three hundred thousand dollars
($300,000). The total of 51,000,000 shares represented 86.47% of our
issued and outstanding common stock. Garrett K. Krause is the
Executive Chairman of WorldVest Equity, Inc.
On April
13, 2010, WorldVest Equity, Inc. transferred 45,000,000 shares to WV55 Partners
a new Investment Fund set up and managed by WorldVest Equity,
Inc. WorldVest Equity also transferred 650,000 shares to Alexis
Liberty Trust, LLC, 2,500,000 shares to Alexis Capital Partners, Inc. and
another 2,850,000 shares to China International Investors, Inc.
37
ITEM
14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
(1)
Audit Fees
Audit Related
Fees
For the
fiscal year ended December 31, 2009, and the period ended December 31, 2008, the
Company was billed approximately $32,355 and $22,000 respectively for
professional services rendered for the audit and review of our financial
statements.
Tax Fees
For the
fiscal year ended December 31, 2009 and for the period ended December 31, 2008,
the Company did not incur any other fees related to services rendered by our tax
professional.
All Other
Fees
For the
fiscal year ended December 31, 2009 and for the period ended December 31, 2008,
the Company did not incur any other fees related to services rendered by our
principal accountant.
Effective
May 6, 2003, the Securities and Exchange Commission adopted rules that require
that before our auditor is engaged by us to render any auditing or permitted
non-audit related service, the engagement be:
·
|
approved
by our audit committee; or
|
·
|
entered
into pursuant to pre-approval policies and procedures established by the
audit committee, provided the policies and procedures are detailed as to
the particular service, the audit
committee is informed of each service, and such policies and procedures do
not include delegation of the audit committee's responsibilities to
management.
|
We do not
have an audit committee. Our entire board of directors pre-approves
all services provided by our independent auditors. The pre-approval process has
just been implemented in response to the new rules. Therefore, our board of
directors does not have records of what percentage of the above
fees were pre-approved. However, all of the above services and fees
were reviewed and approved by the entire board of directors either before or
after the respective services were rendered.
Pursuant
to the requirements of Section 13 or 15(d) 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.
38
PART
IV
Exhibits
Exhibit No. | Description | |
14 | 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
|
Section
1350 Certification of Chief Executive Officer
|
|
32.2
|
Section
1350 Certification of Chief Financial
Officer
|
* Filed
with the Form 10-KSB filed with the SEC on May 20, 2008
39
SIGNATURES
In
accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
WorldVest,
Inc.
|
|||
Date:
April 15, 2010
|
By:
|
/s/ Garrett
K. Krause
|
|
Garrett
K. Krause
|
|||
Chief
Executive Officer
|
|||
Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.
Name
|
Title
|
Date
|
/s/ Garrett K.
Krause
|
Chief Executive Officer |
April
15, 2010
|
Garrett
K. Krause
|
Chief Financial Officer, | |
and
Director
|
40
CERTIFICATION
OF CHIEF EXECUTIVE OFFICER
PURSUANT
TO
18
U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO SECTION 302 OF
THE
SARBANES-OXLEY ACT OF 2002
I,
Garrett K. Krause, certify that:
1.
|
I
have reviewed this Form 10-K of Worldvest, Inc.;
|
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods present in this
report;
|
|
4.
|
I
am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and
internal control over financial reporting (as defined in Exchange Act
Rules 13-a-15(f) and 15d-15(f)) for the registrant and
have:
|
|
a)
|
Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
|
|
b)
|
Designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
|
c)
|
Evaluated
the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation; and
|
|
d)
|
Disclosed
in this report any change in the registrant’s internal control over
financing reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
|
5.
|
I
have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit
committee of the registrant’s board of directors (or persons performing
the equivalent functions):
|
|
a)
|
All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant’s ability to record,
process, summarize and report financial information;
and
|
|
b)
|
Any
fraud, whether or not material, that involved management or other
employees who have a significant role in the registrant’s internal control
over financial reporting.
|
Date:
April 15, 2010
|
By:
|
/s/
Garrett K. Krause
|
|
Garrett
K. Krause
|
|||
Chief
Executive Officer
|
41
CERTIFICATION
OF CHIEF FINANCIAL OFFICER
PURSUANT
TO
18
U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO SECTION 302 OF
THE
SARBANES-OXLEY ACT OF 2002
I,
Garrett K. Krause, certify that:
1.
|
I
have reviewed this Form 10-K of Worldvest, Inc.;
|
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods present in this
report;
|
|
4.
|
I
am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and
internal control over financial reporting (as defined in Exchange Act
Rules 13-a-15(f) and 15d-15(f)) for the registrant and
have:
|
|
a)
|
Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
|
|
b)
|
Designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
|
c)
|
Evaluated
the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation; and
|
|
d)
|
Disclosed
in this report any change in the registrant’s internal control over
financing reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
|
5.
|
I
have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit
committee of the registrant’s board of directors (or persons performing
the equivalent functions):
|
|
a)
|
All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant’s ability to record,
process, summarize and report financial information;
and
|
|
b)
|
Any
fraud, whether or not material, that involved management or other
employees who have a significant role in the registrant’s internal control
over financial reporting.
|
Date:
April 15, 2010
|
By:
|
/s/
Garrett K. Krause
|
|
Garrett
K. Krause
|
|||
Chief
Financial Officer
|
42
CERTIFICATION
PURSUANT TO
18
U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO SECTION 906 OF
THE
SARBANES-OXLEY ACT OF 2002
In
connection with this Annual Report of Worldvest, Inc. (the “Company”) on Form
10-K for the year ended December 31, 2009, as filed with the Securities and
Exchange Commission on the date hereof (the “Report”), I, Garrett K. Krause,
Chief Executive Officer of the Company, certify to the best of my knowledge,
pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the
Sarbanes-Oxley Act of 2002, that:
1.
|
Such
Annual Report on Form 10-K for the year ended December 31, 2009, fully
complies with the requirements of section 13(a) or 15(d) of the Securities
Exchange Act of 1934; and
|
2.
|
The
information contained in such Annual Report on Form 10-K for the year
ended December 31, 2009, fairly presents, in all material respects, the
financial condition and results of operations of Worldvest,
Inc.
|
Date:
April 15, 2010
|
By:
|
/s/
Garrett K. Krause
|
|
Garrett
K. Krause
|
|||
Chief
Executive Officer
|
43
CERTIFICATION
PURSUANT TO
18
U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO SECTION 906 OF
THE
SARBANES-OXLEY ACT OF 2002
In
connection with this Annual Report of Worldvest, Inc. (the “Company”) on Form
10-K for the year ended December 31, 2009, as filed with the Securities and
Exchange Commission on the date hereof (the “Report”), I, Garrett K. Krause,
Chief Financial Officer of the Company, certify to the best of my knowledge,
pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the
Sarbanes-Oxley Act of 2002, that:
1.
|
Such
Annual Report on Form 10-K for the year ended December 31, 2009, fully
complies with the requirements of section 13(a) or 15(d) of the Securities
Exchange Act of 1934; and
|
The
information contained in such Annual Report on Form 10-K for the year
ended December 31, 2009, fairly presents, in all material respects, the
financial condition and results of operations of Worldvest,
Inc..
|
Date:
April 15, 2010
|
By:
|
/s/
Garrett K. Krause
|
|
Garrett
K. Krause
|
|||
Chief
Financial Officer
|
44