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EXCEL - IDEA: XBRL DOCUMENT - Immobiliare Global Investments, Inc.Financial_Report.xls
EX-31.1 - RULE 13A-14(A)/ 15D-14(A) CERTIFICATION OF CHIEF EXECUTIVE OFFICER - Immobiliare Global Investments, Inc.immobiliare_ex31-1sept2012.htm
EX-32.1 - SECTION 1350 CERTIFICATIONS OF CEO AND CFO - Immobiliare Global Investments, Inc.immobiliare_ex32-1sept2012.htm
EX-31.2 - RULE 13A-14(A)/ 15D-14(A) CERTIFICATION OF CHIEF FINANCIAL OFFICER - Immobiliare Global Investments, Inc.immobiliare_ex31-2sept2012.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10–Q

 

(Mark One)

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

 

For the quarterly period ended September 30, 2012

 

or

 

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

 

For the transition period from ____________ to ________________

 

Commission file number: 333-174261

 

IMMOBILIARE GLOBAL INVESTMENTS, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Florida

 

27-3943293

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

 

 

13575 58th Street N., Suite 140, Clearwater, FL 33760

(Address of principal executive offices)

 

(602) 885-9792

(Registrant’s telephone number, including area code)

 

 

(Former name, former address and former fiscal year, if changed since last report)

 

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 [X]  No [] 

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes [X] No [  ]

 

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 (Check one).

 

Large accelerated filer [ ]

 

Accelerated filer [ ]

 

 

 

Non-accelerated filer [ ]

 

Smaller reporting company [X]

(Do not check if a smaller reporting company)

 

 

 

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

 

As of November 12, 2012 there were 64,525 shares of the issuer’s common stock, par value $0.001, outstanding.

 

 


 

 

PART I – FINANCIAL INFORMATION

 

Item 1.      Financial Statements.

 

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the audited financial statements and notes thereto contained in the Company's Form 10-K filed with the SEC on March 30, 2012. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year ending December 31, 2012.

 

 

 

Immobiliare Global Investments, Inc. and Subsidiary

 

 

INDEX TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

 

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2012

 

(Unaudited)

      

 

Page

 

 

Consolidated Balance Sheets

3

 

 

Consolidated Statements of Operations

4

 

 

Consolidated Statements of Cash Flows

5

 

 

Notes to Consolidated Financial Statements

6

 

                                                                         


 

 

 

Immobiliare Global Investments, Inc.

Consolidated Balance Sheets

 

 

As at

September 30,

2012

 

As at

December 31,

2011

ASSETS

(Unaudited)

 

 

 

Current Assets

 

 

 

 

 

Cash

$

35

 

$

6,078

Prepaid legal fees and escrow funds

 

5,237

 

 

126,582

 

 

 

 

 

 

Total Current Assets

 

5,272

 

 

132,660

 

 

 

 

 

 

Land and buildings, net of accumulated depreciation of $234,624 and $213,295, respectively

 

830,063

 

 

851,392

Intangibles

 

-

 

 

622

Other assets

 

2,300

 

 

2,300

 

 

 

 

 

 

Total Assets

$

837,635

 

$

986,974

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIENCY

 

 

 

 

 

Liabilities

 

 

 

 

 

Current Liabilities

 

 

 

 

 

Current portion of mortgage notes payable

$

20,411

 

$

12,280

Accounts payable

 

50,000

 

 

-

Line of credit

 

5,227

 

 

5,115

Loans from officers

 

42,876

 

 

16,076

Accrued officer compensation

 

84,000

 

 

84,000

Accrued interest

 

10,777

 

 

10,819

State tax payable

 

100

 

 

100

 

 

 

 

 

 

Total Current Liabilities

 

213,391

 

 

128,390

 

 

 

 

 

 

Other Liabilities

 

 

 

 

 

Mortgage notes payable

 

835,393

 

 

858,030

Acquisition note payable to stockholders

 

800,000

 

 

800,000

Tenant deposits

 

10,008

 

 

10,008

 

 

 

 

 

 

Total Liabilities

 

1,858,792

 

 

1,796,428

 

 

 

 

 

 

Stockholders’ Deficiency

 

 

 

 

 

Preferred stock, $0.0001 par value, 100,000,000 shares

authorized; 100,000 shares issued and outstanding, respectively

 

10

 

 

10

Common stock, $0.001 par value, 400,000,000 shares

authorized; 64,525 shares issued and outstanding, respectively

 

65

 

 

65

Additional paid-in capital

 

(565,075)

 

 

(565,075)

Accumulated deficit

 

(456,157)

 

 

(244,454)

Total Stockholders’ Deficiency

 

(1,021,157)

 

 

(809,454)

 

 

 

 

 

 

Total Liabilities and Stockholders’ Deficiency

$

837,635

 

$

986,974

 

 

 

 

 

 

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

                                                                         


 

 

 

Immobiliare Global Investments, Inc.

Consolidated Statements of Operations

(Unaudited)

 

 

For the Three Months Ended September 30,

 

 

For the Nine Months Ended September 30

 

 

2012

 

 

2011

 

 

2012

 

 

2011

 

 

 

 

 

 

 

 

 

 

 

 

Rental income

$

32,514

 

$

25,765

 

$

95,824

 

$

89,594

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses:

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

8,792

 

 

9,001

 

 

215,167

 

 

124,286

Stock based compensation

 

-

 

 

-

 

 

-

 

 

40,000

Depreciation and amortization

 

7,202

 

 

7,543

 

 

21,951

 

 

23,224

Abandoned project costs

 

-

 

 

-

 

 

-

 

 

25,000

Total operating expenses

 

15,994

 

 

16,544

 

 

237,118

 

 

212,510

 

 

 

 

 

 

 

 

 

 

 

 

Net operating income (loss)

 

16,520

 

 

9,221

 

 

(141,294)

 

 

(122,916)

Interest expenses

 

23,214

 

 

25,332

 

 

70,410

 

 

72,743

 

 

 

 

 

 

 

 

 

 

 

 

Net loss before taxes

 

(6,694)

 

 

(16,111)

 

 

(211,704)

 

 

(195,659)

Provision for income tax

 

-

 

 

-

 

 

-

 

 

(8,200)

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

$

(6,694)

 

$

(16,111)

 

$

(211,704)

 

$

(203,859)

 

 

 

 

 

 

 

 

 

 

 

 

Loss per share, primary and dilutive

$

(0.10)

 

$

(0.25)

 

$

(3.28)

 

$

(3.22)

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding, primary and dilutive

 

 

64,525

 

 

64,525

 

 

 

64,525

 

 

 

63,293

 

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

                                                                         


 

 

Immobiliare Global Investments, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

 

 

For the Nine Months Ended September 30,

 

 

2012

 

 

2011

Cash Flows from Operating Activities:

 

 

 

 

 

Net loss

$

(211,704)

 

$

(203,859)

Adjustments to reconcile net income to net cash provided by operations:

 

 

 

 

 

Depreciation and amortization

 

21,951

 

 

23,224

Stock-based and non-cash compensation

 

-

 

 

40,000

Changes in assets and liabilities:

 

 

 

 

 

Prepaid expenses and escrow funds

 

121,345

 

 

(5,219)

Deferred tax asset

 

-

 

 

8,200

Accounts payable and accrued expenses

 

49,958

 

 

94,819

Net cash (Used) Provided by Operating Activities

 

(18,450)

 

 

(42,835)

 

 

 

 

 

Cash Flows from Investing Activities:

 

 

 

 

 

Purchase of property and equipment

 

-

 

 

(955)

Net cash (Used) Provided by Investing Activities

 

-

 

 

(955)

 

 

 

 

 

 

Cash Flows from Financing Activities:

 

 

 

 

 

Proceeds from issuance of common stock

 

-

 

 

50,000

Proceeds from shareholder loans

 

26,800

 

 

4,601

Payments on mortgage notes payable

 

(14,505)

 

 

(11,638)

Net proceeds from line of credit

 

112

 

 

887

Net cash (Used) provided by Financing Activities

 

12,407

 

 

43,850

 

 

 

 

 

 

Net increase (decrease) in cash

 

(6,043)

 

 

60

 

 

 

 

 

 

Cash at beginning of period

 

6,078

 

 

64

 

 

 

 

 

 

Cash end of period

$

35

 

$

124

 

 

 

 

 

 

Supplemental Cash Flow Disclosure:

 

 

 

 

 

Interest paid

$

70,410

 

$

61,924

Taxes paid

$

-

 

$

-

 

 

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

                                                                         


 

 

 

Immobiliare Global Investments, Inc. and Subsidiary

Notes to Consolidated Financial Statements

For the Nine Months Ended September 30, 2012

(Unaudited)

 

 

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Organization and Business Activity

 

Immobiliare Global Investments, Inc. (the “Company” or “Immobiliare”) was incorporated on July 1, 2010 in the State of Florida and commenced operations on that day. Thomas Investment Holdings, Inc., (“Thomas”) was a privately-held limited liability company that was organized on April 23, 2004 in the State of Utah.  Effective November 10, 2010 the companies, completed the purchase and sale agreement between Thomas and Immobiliare and the member of Thomas, pursuant to which Immobiliare acquired all of the membership shares of Thomas by issuing 125,000 shares of common stock to the selling members and notes payable to the previous member of Thomas in the amount of $800,000 for a total consideration of $812,500. Consummation of the merger did not require a vote of the Immobiliare shareholders. As a result of the acquisition, the shareholders of Thomas did not own a majority of the voting stock of Immobiliare and Thomas is a wholly owned subsidiary of Immobiliare.  The previous majority shareholder of Thomas is a material shareholder, although not a majority shareholder, and the President and CEO of Immobiliare.

 

Although Thomas became a wholly owned subsidiary of Immobiliare in the merger, for financial reporting purposes Thomas is treated as "accounting acquirer" because its previous majority shareholder continued to own a material interest in Immobiliare and is the President and CEO of Immobiliare. Accordingly, the historical consolidated financial statements prior to the date of merger that are included in these consolidated financial statements for comparative purposes are the financial statements of Thomas. In accounting for this reverse merger, the legal share capital is that of Immobiliare (the legal parent).  In consolidation, the original investment in Thomas has been recorded as a distribution to the former owners of Thomas. 

 

The Company operates in the real estate industry, primarily in the area of investing in land and buildings to earn rental income in Salt Lake City, Utah.

 

Principles of Consolidation

 

The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Thomas Investment Holdings, LLC. All significant intercompany balances and transactions have been eliminated in these consolidated financial statements.  The original investment by Immobiliare in Thomas has been recorded as a distribution to the former owners of Thomas.

 

Basis of Accounting

 

The unaudited financial statement and notes are presented in accordance with accounting principles generally accepted in the United States of America (GAAP).  These interim financial statements include all adjustments that, in the opinion of management, are necessary in order to make the financial statements not misleading.   

 

Use of estimates

 

The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates in the accompanying consolidated financial statements include the amortization period for intangible assets, valuation and impairment of intangible assets, depreciable lives of the real property and the valuation allowance on deferred tax assets.

 

Cash and Cash Equivalents

 

Cash equivalents are generally comprised of certain highly liquid investments with maturities of three months or less.

 

Concentrations of Credit Risk

 


 

 

 

 

The Company's financial instruments that are exposed to concentrations of credit risk consist primarily of temporary cash investments and trade accounts receivable. The Company maintains its cash balances at a financial institution. At times such investments may exceed federally insured limits. The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash. The Company believes it is not exposed to any significant credit risk on trade accounts receivable because the Company routinely assesses the financial strength of its customers before extending credit.

 

Land and Buildings

 

Land and buildings are stated at cost net of accumulated depreciation. Land is not depreciated. Depreciation on buildings is computed using the straight-line method over the estimated useful lives of the buildings, generally twenty-seven and a half years. Depreciation begins in the month of acquisition or when constructed buildings are ready for their intended use.

 

Costs of renewals and improvements which substantially extend the useful life of the buildings are capitalized. Upon retirement, sale or other disposition, the cost and accumulated depreciation are eliminated from the respective accounts and any resulting gain or loss is included in operations. Maintenance and repairs are expensed as incurred.

 

Intangible Assets

 

Intangible assets with finite lives consist of capitalized loan costs and are amortized using the straight-line method over their estimated useful lives.

 

Income Taxes

 

Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related primarily to the difference between the bases of certain assets and liabilities for financial reporting and income tax reporting. Valuation allowances are established, if necessary, to reduce the deferred tax asset to the amount that will more likely than not be realized.

 

Upon completion of the November 10, 2010 transaction with Immobiliare, Thomas ceased to be treated as a partnership for income tax purposes, resulting in (1) the imposition of income tax at the corporate level instead of the individual member level and (2) the inability to continue to elect to be taxed on a Cash Basis resulting in a potential transitional income tax liability. The potential liability is subject to special transitional rules that may allow such amounts, once they have been determined, to be paid over a four year period pursuant to the IRS code. The former members of the limited liability company have undertaken to provide such assistance as may be necessary to minimize the Company's exposure to such potential tax liability.

 

Revenue Recognition

 

Revenue is recognized when rental income is received due to the uncertainty associated with collecting the income. Lessors are generally on a month to month rental basis.

 

Earnings (Loss) per Share

 

Basic earnings (loss) per share calculations are determined by dividing net income (loss) by the weighted average number of shares outstanding during the period. Diluted earnings (loss) per share calculations are determined by dividing net income (loss) by the weighted average number of shares. During the nine months ended September 30, 2012 and 2011, there were no common stock equivalents outstanding.

 

NOTE 2 - GOING CONCERN

 

The accompanying consolidated 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 sustained net losses of $211,704 and used cash in operating activities of $18,450 for the period ended September 30, 2012.  The Company had a working capital deficiency, stockholders’ deficiency and accumulated deficit of $208,119, $1,021,157 and $456,157, respectively, at September 30, 2012.  These factors raise substantial doubt about the ability of the Company to continue as a going concern for a reasonable period of time.  The Company’s continuation as a going concern is dependent upon its ability to generate revenues and its ability to continue receiving capital from third parties.  No assurance can be given that the Company will be successful in these efforts.

 


 

 

 

The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

NOTE 3 - LAND AND BUILDINGS

 

Land and buildings consisted of the following:

 

 

September 30, 2012

(Unaudited)

 

December 31, 2011

(Audited)

 

 

 

 

 

 

 

 

Land

$

285,371

 

$

285,371

Buildings and improvements, at cost

 

778,361

 

 

778,361

Furniture

 

955

 

 

955

 

 

1,064,687

 

 

1,064,687

Less: accumulated depreciation

 

(234,624)

 

 

(213,295)

Land and Buildings, net

$

830,063

 

$

851,392

 

Depreciation expense was $21,951 and $23,224 for the nine months ended September 30, 2012 and 2011.

 

NOTE 4 - INTANGIBLES

 

Intangibles at September 30, 2012 and December 31, 2011 consisted of:

 

 

September 30, 2012

(Unaudited)

 

December 31, 2011

(Audited)

 

 

 

 

 

 

 

 

Capitalized costs

$

6,915

 

$

6,915

Less: accumulated amortization

 

(6,915)

 

 

(6,293)

Intangibles, net

$

-

 

$

622

 

Amortization of capitalized loan fees was $622 for the nine months ended September 30, 2012.

 

NOTE 5 - PREPAID LEGAL EXPENSE AND CONTINGENT LIABILITY

 

During 2010 the founding stockholders of the Company engaged the services of an attorney to assist them in the preparation and filing of Form S-1 with the Securities and Exchange Commission (“SEC”) to register as an issuer under the Securities and Exchange Acts. In connection with the filing of this registration statement the founding stockholders agreed to pay the attorney $125,000 for the preparation and filing of Form S-1. In return for the prepayment of $125,000 in legal fees the founding stockholders were issued 60,000 shares of the Company’s common stock which was the initial stock issuance for Immobiliare Global Investments, Inc.

 

The $125,000 advanced to the attorney by the Stockholders on behalf of the Company has been recognized as prepaid legal fees at December 31, 2011. The registration statement was deemed to be effective by the SEC on February 8, 2012.  The entire amount was charged to operations on that date.

 

Upon effective date of the registration statement by the SEC (February 8, 2012), the agreement with the attorney calls for an additional payment of $50,000 that will be paid by the Company.

 

NOTE 6 - LINE OF CREDIT PAYABLE

 

The Company has a line of credit with a local credit union for $6,000. The line of credit is unsecured, bears interest at 18% per annum and matures annually. At September 30, 2012 and December 31, 2011 the balance drawn on the line of credit was $5,227 and $5,115, respectively.  At September 30, 2012, the Company had $773 of credit available on this line.

 

NOTE 7 - INCOME TAXES

 

During the nine months ended September 30, 2012 and 2011, the Company had losses of $211,704 and $195,659, respectively. The losses generated $0 and $8,200 in deferred federal and state income tax provisions using a blended income tax rate of 37.25% after an allowance for deferred tax asset realization.

 


 

 

The components of income tax expense attributable to continuing operations for the nine months ended September 30, 2012 and 2011 are as follows:

 

 

 

2012

 

2011

Deferred federal and state income tax benefit

 

$

72,000

 

$

66,500

 

 

 

 

 

 

 

Current state income tax benefit

 

 

6,900

 

 

6,500

Change in allowance for deferred tax assets

 

 

(78,900)

 

(81,200)

 

 

 

 

 

 

 

Provision for income tax

 

$

-

 

$

8,200

 

The net operating losses begin expiring in 2031.

 

NOTE 8 - ACQUISITION NOTES PAYABLE TO STOCKHOLDERS

 

The former member of Thomas was given a note as consideration for the membership of Thomas Investment Holdings, Inc. together with 125,000 shares of restricted common stock of the Company. The note bears interest at 4.5%, and is payable in monthly interest only installments from January 1, 2011. The notes must be repaid by November 10, 2014 or the membership interests of Thomas Investment Holdings, Inc. must be returned to the holders. The notes are secured by membership interests in Thomas Investments, LLC and by the individual real properties owned by Thomas Investments, LLC and operated by the Company.  Wayne Middleton has designated a portion of this note to be payable to William Middleton under the same terms. 

 

Acquisition note payables at September 30, 2012 and December 31, 2011 are as follows:

 

 

 

 

September 30, 2012

(Unaudited)

 

 

December 31, 2011

(Audited)

 

Note payable to Wayne Middleton, due November 10, 2014, with monthly payments of interest only, secures by membership interest in Thomas Investment Holdings and real estate. $80,000 of this note is designated as payable to William Middleton under the same terms.

 

 

 

 

 

 

 

$

 

 

 

 

 

800,000

 

 

 

 

 

 

 

$

 

 

 

 

 

800,000

                 

 

NOTE 9 - MORTGAGE NOTES PAYABLE

 

The Company issued a number of mortgage notes to acquire property.  These notes are generally payable in monthly installments of interest and principle and secured by property in and around Salt Lake City, Utah (SLC).  Mortgage note payables at September 30, 2012 and December 31, 2011 are as follows:

 

 

 

 

September 30, 2012

(Unaudited)

 

 

December 31, 2011

(Audited)

 

 

Note to a credit union, interest at 6%, due in monthly installments of $1,876, including interest, secured by a home and duplex on Major St, SLC and maturing May 2014

 

 

 

 

$

 

 

236,633

 

 

 

 

$

 

 

242,735

 

 

 

 

 

 

 

 

 

 

 

Note to a finance company, interest at 6.63%, due in interest only installments of $496, including interest, secured by 1414 S 900 W, SLC and maturing in November 2034

 

 

 

 

 

89,825

 

 

 

 

 

89,825

 

 

 

 

 

 

 

 

 

 

 

Note to a finance company, interest at 9.75%, due in monthly installments of $206, including interest, secured by 1414 S 900 W, SLC and maturing August 2020

 

 

 

 

 

22,640

 

 

 

 

 

22,833

 

 

 

 

 

 

 

 

 

 

 

Note to a bank, interest at 6.75%, due in interest only installments of $526, including interest, secured by 476 S Concord, SLC and maturing November 2035

 

 

 

 

 

93,597

 

 

 

 

 

93,597

 

 

 

 

 

 

 

 

 

 

 

Note to a finance company, interest at 11.5%, due in monthly installments of $248, including interest, secured by 476 S Concord, SLC and maturing November 2020

 

 

 

 

 

24,059

 

 

 

 

 

24,209

 

 

 

 

 

 

 

 

 

 

 

Note to a bank, interest at 7.735%, due in interest only installments of $587, including interest, secured by 345 N 1200 W, SLC and maturing November 2035

 

 

 

 

 

87,401

 

 

 

 

 

87,605

 

 

 

 

 

 

 

 

 

Note to a finance company, interest at 10%, due in monthly installments of $158, including interest, secured by 345 N 1200 W, SLC and maturing November 2035

 

 

 

 

 

17,068

 

 

 

 

 

17,206

 

 

 

 

 

 

 

 

 

 

 

Note to a bank, interest at 8.79%, due in interest only installments of $699, including interest, secured by 1111 W 900 S, SLC and maturing November 2035

 

 

 

 

 

85,058

 

 

 

 

 

85,817

 

 

 

 

 

 

 

 

 

 

 

Note to a finance company, interest at 10%, due in monthly installments of $155, including interest, secured by 1111 W 900 S, SLC and maturing November 2035

 

 

 

 

 

16,513

 

 

 

 

 

16,666

 

 

 

 

 

 

 

 

 

 

 

Note to a credit union, interest at 5%, due in monthly installments of $1,546, including interest, secured by land and buildings on Major St, SLC and maturing April 2026

 

 

 

 

 

183,010

 

 

 

 

 

189,918

 

 

 

 

 

 

 

 

 

Total mortgage notes receivable

 

 

 

855,804

 

 

 

870,310

Less current portion of mortgage notes payable

 

 

 

20,411

 

 

 

12,280

 

 

 

 

 

 

 

 

 

Long-term portion of mortgage notes payable

 

 

$

835,393

 

 

$

858,030


 

 

Aggregate maturities of mortgage notes payable for each of the next five years is as follows:

 

 

2012

 

 

$

4,977

 

2013

 

 

 

20,644

 

2014

 

 

 

238,559

 

2015

 

 

 

13,410

 

2016

 

 

 

14,200

 

Thereafter

 

 

 

564,014

 

 

 

 

 

 

 

 

 

 

$

855,804

 

NOTE 10 - EQUITY

 

Preferred Stock Rights and Privileges

 

The Company is authorized to issue 100,000,000 of preferred stock with a par value of $0.0001 per share.  Currently there are a total of 100,000 shares of Preferred "C" shares outstanding.  There are no Preferred “A” or “B” shares designated at this time.  Each Preferred "C" Share is entitled to cast five thousand (5,000) votes. These shares were issued in proportional amounts to the original founding stockholders, no payment was received. The class "C" preferred stock has no equity conversion rights. The shares contain a restriction on transferability which prohibits the transfer of the shares without prior written approval of the Board of Directors of the Company.

 

There were no preferred shares issued during the period ended September 30, 2012 and the year ended December 31, 2011.

 


 

Common Stock issues

 

The Company is authorized to issue up to 400,000,000 shares of common stock with a par value of $0.001 per share

 

Effective August  28, 2012, the Company effected a 1 for 1,000 reverse split on its common stock outstanding, under which each stockholder of record on that date received one (1) new share of the Corporation’s $0.001 par value common stock for every one thousand (1,000) old shares owned.

 

The Company has issued shares of its common stock as follows, retroactively adjusted to give effect to the 1 for 1,000 reverse split:

 

In January 2011, the Company issued 1,000 shares each to the four directors as compensation for services.  This stock was valued at $10,000 per director.

 

On March 31, 2011, the Company issued 80 shares to an unrelated party for $20,000 cash.

 

On April 25, 2011, the Company issued 120 shares to an unrelated party for $30,000 cash.

 

NOTE 11 – RELATED PARTY TRANSACTIONS

 

During the period ended September 30, 2012, the Company made a total of $18,000 in interest payments on the acquisition notes payable to two stockholders.  Another $6,000 of interest was accrued as of September 30, 2012.

 

The directors of the Company had agreements providing them compensation of $7,000 per month starting in January 2011.  Each of the four directors accrued $21,000 in compensation for the first quarter.  The board agreed to stop these accruals as of April 1, 2011 until further notice.  None of this compensation has been paid.  The accrued salary is shown on the balance sheet as accrued compensation and the expense is shown on the statement of operations for the year ended December 31, 2011 as part of the general and administrative operating expenses.

 

From time to time an officer may pay an expense for or loan money to the Company with the expectation of being reimbursed.  These loans are temporary in nature, do not accrue interest and are unsecured.  At September 30, 2012 and December 31, 2011, the Company owed $42,876 and $16,076 to officers for temporary loans, respectively.

 

NOTE 12 – CONTINGENCIES

 

From time to time the Company may be a party to litigation matters involving claims against the Company. Management believes that there are no current matters that would have a material effect on the Company’s financial position or results of operations other than what is noted here.

 

Upon effective date of the registration statement by the SEC, which occurred on February 8, 2012, the agreement with the attorney calls for an additional payment of $50,000 that will be paid by the Company. This contingent fee has been recorded accordingly in accounts payable on the accompanying Consolidated Balance Sheets at September 30, 2012.

 

NOTE 13 – SUBSEQUENT EVENTS

 

In accordance with ASC 855-10, Company management reviewed all material events through the date of this report and determined that there are no material subsequent events to report.  

 


 

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

 

This report on Form 10-Q contains forward-looking statements within the meaning of Rule 175 of the Securities Act of 1933, as amended, and Rule 3b-6 of the Securities Act of 1934, as amended, that involve substantial risks and uncertainties. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our industry, our beliefs and our assumptions. Words such as “anticipate”, “expects”, “intends”, “plans”, “believes”, “seeks” and “estimates” and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. You should not place undue reliance on these forward-looking statements, which apply only as of the date of this Form 10-Q. Investors should carefully consider all of such risks before making an investment decision with respect to the Company’s stock. The following discussion and analysis should be read in conjunction with our consolidated financial statements and summary of selected financial data for Immobiliare Global Investments, Inc. Such discussion represents only the best present assessment from our Management.

 

Description of the Company

 

Our Company is involved in real estate investments through our wholly owned subsidiary, Thomas Investment Holdings, LLC (“Thomas” or “TIH”), a Utah limited liability company. Thomas presently owns several parcels of real estate in Salt Lake City, Utah from which it receives rental income. For the next twelve (12) month period we propose to develop a state of the art self-storage facility totaling 53,400 square feet along with 900 units, located in Salt Lake City, Utah.

 

The Company was incorporated in Florida on July 1, 2010, as Immobiliare Investors, Inc. On November 1, 2010 we amended our articles of incorporation and changed our name to Immobiliare Global Investments, Inc.

 

On February 8, 2012, the Company became effective with the SEC.  As of this filing, the Company has not filed with FINRA for its trading symbol.  

 

On August 28, 2012, we effected a one (1) for 1,000 reverse stock split of our issued and outstanding common stock. As a result, our issued and outstanding common stock decreased from 64,525,000 shares to 64,525 shares of common stock, all with a par value of $0.001.

 

The Company has one wholly-owned subsidiary, Thomas Investment Holdings, LLC.

 

The following Management Discussion and Analysis should be read in conjunction with the consolidated financial statements and accompanying notes included in on our Form 10-K, as filed with the SEC on March 30, 2012. 

 

Executive Summary

 

For the nine months ended September 30, 2012, we reported rental income of $95,824, an increase of $6,230, or 1%, over the $89,594 reported for the period ended September 30, 2011. Operating and interest expenses, which include all interest, depreciation, selling, general and administrative costs, increased $22,275, or 8%, to $307,528 for the period ended September 30, 2012 as compared to $285,253 for the period ended September 30, 2011.  Net loss for the period ended September 30, 2012 was $211,704 compared to net loss of $203,859 for the period ended September 30, 2011.

 

Results of Operations

 

The following summary of our results of operations should be read in conjunction with our consolidated financial statements for the periods ended September 30, 2012 and 2011.

 

Our operating results for the periods ended September 30, 2012 and 2011 are summarized as follows:

 

 

 

Nine Months Ended  

 

 

 

September 30  

 

 

 

2012  

 

 

2011  

 

Revenue

$

95,824

 

$

85,594

 

Operating expenses

 

237,118

   

212,500

 

Net operating loss

 

(141,294

)

 

(122,916

Interest expenses

 

70,410

   

72,743

 

Provision for income tax

 

-

 

 

8,200

 

Net Loss

$

(211,704

)

$

(203,859

)


 

 

Revenue

 

We earned revenues of $95,824 for the nine months ended September 30, 2012 compared to revenues of $89,594 for the nine months ended September 30, 2011.

 

Expenses

 

Our total expenses for the periods ended September 30, 2012 and 2011 are outlined in the table below:

 

 

 

Nine Months Ended  

 

 

 

September 30  

 

 

 

2012  

 

 

2011

 

General and administrative

$

215,167

 

$

124,286

 

Stock based compensation

 

-

   

40,000

 

Depreciation and amortization

 

21,951

   

23,224

 

Abandoned project costs

 

-

   

25,000

 

Interest expense

 

70,410

 

 

72,743

 

Total

$

307,528

 

$

285,253

 

 

Expenses for the period ended September 30, 2012, increased by 8% as compared to the comparative period in 2011 primarily as a result of a one time commitment for legal fees related to our recent S-1 Registration filing with the SEC.  A significant portion of expenses for the period ended September 30, 2012, $175,000, resulted from the legal fees that were due when our S-1 became effective on February 8, 2012.

 

Liquidity and Capital Resources

 

General

 

At September 30, 2012 we had cash and cash equivalents of $35. We have historically met our cash needs through a combination of cash flows from operating activities, proceeds from private placements of our securities and loans. Our cash requirements are generally for selling, general and administrative activities. We believe that our cash balance is not sufficient to finance our cash requirements for expected operational activities, capital improvements, and partial repayment of debt through the next 12 months.

 

Our operating activities used cash of $18,450 for the period ended September 30, 2012, compared to cash used by operating activities of $42,835 during the same period in 2011. The principal elements of cash flow from operations for the period ended September 30, 2012 included a net loss of $211,704 offset by depreciation and amortization, $21,951, prepaid expenses, $121,345, and accounts payable and accrued expenses, $49,958.

 

Cash generated in our financing activities was $12,407 for the period ended September 30, 2012, compared to cash generated in financing activities of $43,850 during the comparable period in 2011. This decrease was primarily attributed to the sale of common stock for $50,000, in the previous period.

 

Cash used in investing activities during the period ended September 30, 2012 was $0 compared to $955 during the same period in 2011.

 

Liquidity and Financial Condition

 

Working Capital  

 

 

 

 

 

 

 

 

 

 

 

At  

 

 

At  

 

 

 

 

 

 

September 30,  

 

 

December 31,  

 

 

Increase/  

 

 

 

2012  

 

 

2011

 

 

(Decrease)  

 

Current Assets

$

5,272

 

$

132,660

 

$

(127,388

)

Current Liabilities

$

213,391

 

$

128,390

 

$

85,001

 

Working Capital (deficit)

$

(208,119

$

4,270

 

$

(212,389

)


 

 

Cash Flows  

 

 

 

 

 

 

 

 

Nine Months Ended  

 

 

Nine Months Ended  

 

 

 

September 30,  

 

 

September 30,  

 

 

 

2012

 

 

2011  

 

Net Cash Used by Operating Activities

$

(18,450

)

$

(42,835

)

Net Cash Used by Investing Activities

$

-

$

(955

)

Net Cash Provided by Financing Activities

$

12,407

$

43,850

 

Net Increase (Decrease) in Cash During the Period

$

(6,043

)

$

60

 

 

We will require additional funds to fund our budgeted expenses in the future. These funds may be raised through equity financing, debt financing, or other sources, which may result in further dilution in the equity ownership of our shares. There is no assurance that we will be able to maintain operations at a level sufficient for an investor to obtain a return on their investment in our common stock. Further, we may continue to be unprofitable. We may need to raise additional funds in the future in order to proceed with our budgeted expenses. Additionally, there is no assurance that any party will advance additional funds to us in order to enable us to sustain our plan of operations or to repay our liabilities.

 

Contractual Obligations

 

As a “smaller reporting company”, we are not required to provide tabular disclosure obligations.

 

Going Concern

 

The Company sustained net losses of $211,704 and used cash in operating activities of $18,450 for the period ended September 30, 2012.  The Company had a working capital deficiency, stockholders’ deficiency and accumulated deficit of $208,119, $1,021,157 and $456,157, respectively, at September 30, 2012.  These factors raise substantial doubt about the ability of the Company to continue as a going concern for a reasonable period of time.  The Company’s continuation as a going concern is dependent upon its ability to generate revenues and its ability to continue receiving capital from third parties.  No assurance can be given that the Company will be successful in these efforts.

 

Critical Accounting Policies

 

Use of Estimates. The preparation of consolidated 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 at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.  Significant estimates in the accompanying consolidated financial statements include the amortization period for intangible assets, valuation and impairment valuation of intangible assets, depreciable lives of the website and property and equipment, valuation of warrant and beneficial conversion feature debt discounts, valuation of share-based payments and the valuation allowance on deferred tax assets.

 

Changes in Accounting Principles. No significant changes in accounting principles were adopted during the period ended September 30, 2012 .

 

Website Development Costs.  The Company accounts for its website development costs in accordance with Accounting Standards Codification (“ASC”) ASC 350-10 “Accounting for the Costs of Computer Software Developed or Obtained for Internal Use” (“ASC 350-10”).  These costs are included in intangible assets in the accompanying consolidated financial statements.

 

ASC 350-10 requires the expensing of all costs of the preliminary project stage and the training and application maintenance stage and the capitalization of all internal or external direct costs incurred during the application development stage.  The Company amortizes the capitalized cost of software developed or obtained for internal use over an estimated life of three years.

 


 

Impairment of Long-Lived Assets.  The Company accounts for long-lived assets in accordance with the provisions of Statement of Financial Accounting Standards ASC 360-10, “Accounting for the Impairment or Disposal of Long-Lived Assets”.  This statement requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset.  If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.  Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.

 

Fair Value of Financial Instruments and Fair Value Measurements.   The Company measure their financial assets and liabilities in accordance with generally accepted accounting principles.  For certain of our financial instruments, including cash, accounts payable, accrued expenses escrow liability and short term loans the carrying amounts approximate fair value due to their short maturities.

 

Effective January 1, 2008, we adopted accounting guidance for financial and non-financial assets and liabilities.  The adoption did not have a material impact on our results of operations, financial position or liquidity.  This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures.  This standard does not require any new fair value measurements, but rather applies to all other accounting pronouncements that require or permit fair value measurements.  This guidance does not apply to measurements related to share-based payments.  This guidance discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost).  The guidance utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels.  The following is a brief description of those three levels:

 

Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.

 

Level 2: Inputs other than quoted prices that are observable, either directly or indirectly.  These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.

 

Level 3: Unobservable inputs in which little or no market data exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use.

 

Revenue Recognition. Revenues are recognized on our products in accordance with ASC 605-10, “Revenue Recognition in Financial Statement.”  Under these guidelines, revenue is recognized on sales transactions when all of the following exist:  persuasive evidence of an arrangement did exist, delivery of service has occurred, the sales price to the buyer is fixed or determinable and collectability is reasonably assured. The Company has revenue streams as follows:

 

 

Rental income from TIH residential rental properties.

 

Stock-Based Compensation. The Company accounts for stock-based instruments issued to employees in accordance with ASC Topic 718. ASC Topic 718 requires companies to recognize in the statement of operations the grant-date fair value of stock options and other equity based compensation issued to employees.  The Company accounts for non-employee share-based awards in accordance with ASC Topic 505-50.  The value of the portion of an award that is ultimately expected to vest is recognized as an expense over the requisite service periods using the straight-line attribution method.  The Company estimates the fair value of each stock option at the grant date by using the Black-Scholes option-pricing model.  The Company estimates the fair value of each stock option at the grant date by using the Black-Scholes option-pricing model.

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

 

Item 3. Quantitative and Qualitative Disclosures about Market Risk

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.


 

 

Item 4. Controls and Procedures

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our president and chief executive officer (our principal executive officer) and our chief financial officer (our principal financial officer and principal accounting officer), to allow for timely decisions regarding required disclosure.

 

As of the end of the fiscal quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president and chief executive officer (our principal executive officer) and our chief financial officer (our principal financial officer and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president and chief executive officer (our principal executive officer) and our chief financial officer (our principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.

 

Changes in Internal Control Over Financial Reporting

 

There were no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2012 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II – OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

 

Item 1A. Risk Factors.

 

There have been no material changes to any risk factors affecting our Company as disclosed by us in our Annual Report on Form 10-K for the year ended December 31, 2011.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

None.

 

Item 3. Defaults upon Senior Securities

 

None.

 

Item 4. Mining Safety Disclosure

 

None.

 

Item 5. Other Information

 

On August 28, 2012, we effected a one (1) for 1,000 reverse stock split of our issued and outstanding common stock. As a result, our issued and outstanding common stock decreased from 64,525,000 shares to 64,525 shares of common stock, all with a par value of $0.001.

 

During the quarter ended June 30, 2012, the Board of Directors accepted the resignations of Messrs. Charles Irizarry, Dave Skutt, and Henrik Zohrabians as Directors.  Our Board of Directors consists solely of Mr. Wayne Middleton, who is also our President, CEO, Secretary, and Treasurer.  Mr. Bradford Margetts shall maintain his position as our Chief Financial Officer. There were no disagreements between the Registrant and Messrs. Irizarry, Skutt, and Zohrabians regarding management of the Company relating to the registrant’s operations, policies or practices.


 

 

Item 6.  Exhibits

 

The following exhibits are included as part of this report:

 

           Exhibit No.                                Description 

 

31.1 / 31.2                     Rule 13(a)-14(a)/15(d)-14(a) Certification of Principal Executive and Financial Officer

32.1 / 32.2                     Rule 1350 Certification of Principal Executive and Financial Officer

101.INS*                       XBRL Instance

101.SCH*                     XBRL Taxonomy Extension Schema

101.CAL*                     XBRL Taxonomy Extension Calculations

101.DEF*                      XBRL Taxonomy Extension Definitions

101.LAB*                     XBRL Taxonomy Extension Labels

101.PRE*                      XBRL Taxonomy Extension Presentation

 

*  XBRL Information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

 

 

 

 


 

SIGNATURES  

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

 

 

IMMOBILIARE GLOBAL INVESTMENTS, INC.  

 

(Registrant)

 

 

 

 

Dated: November 15, 2012

/s/ Wayne Middleton  

 

Wayne Middleton  

 

Principal Executive Officer

 

 

 

 

Dated: November 15, 2012

/s/ Bradford Margetts

 

Bradford Margetts

 

Principal Accounting Officer