WESTMOUNTAIN COMPANY

Indicate by check mark whether the registrant: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 is a large accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “small reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer []	Accelerated filer []
Non-accelerated filer   [] (Do not check if a smaller reporting company)	Smaller reporting company  [X]

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

 

WestMountain Company

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PART I  FINANCIAL INFORMATION

For purposes of this report, unless otherwise indicated or the context otherwise requires, all references herein to "WestMountain Company "we," "us," and "our," refer to WestMountain Company, a Colorado corporation, formerly known as WestMountain Asset Management, Inc., and our wholly-owned subsidiaries WestMountain Business Consulting, Inc., WestMountain Valuation Services, Inc., and WestMountain Allocation Analysis, Inc.

ITEM 1.  FINANCIAL STATEMENTS

 

 

WestMountain Company
Consolidated Balance Sheets
(Unaudited)
		March 31,				December 31,
		2015				2014
Assets
Current Assets:
Cash and cash equivalents		$	334,855			$	445,411
Investments in marketable securities			376,716				1,006,230
Accounts receivable, related parties			18,000				41,125
Accounts receivable			27,900				12,300
Income tax receivable			4,417				-
Note receivable, related parties			52,823				25,937
Prepaid expenses			4,697				9,807
Deferred tax asset			210,677				-
Total current assets			1,030,085				1,540,810
Property and equipment, net of accumulated depreciation of			5,659				6,173
$9,987 and $9,473, respectively
Investments in nonmarketable securities, at cost			31,645				31,645
Total assets		$	1,067,389			$	1,578,628
Liabilities and Shareholders'Equity
Current Liabilities:
Accounts payable and accrued liabilities		$	32,020			$	37,293
Deferred tax liability			85,085				107,958
Income tax payable			-				68,662
Total current liabilities			117,105				213,913
Total liabilities			117,105				213,913
Shareholders' Equity:
Preferred stock, $0.10 par value; 1,000,000 shares authorized,			-				-
none issued and outstanding
Common stock, $.001 par value; 50,000,000 shares authorized,
9,517,402 shares issued and outstanding			9,518				9,518
Additional paid-in capital			927,355				927,355
Accumulated earnings (deficit)			(131,117	)			8,952
Other comprehensive income, net			144,528				418,890
Total shareholders' equity			950,284				1,364,715
Total liabilities and shareholders' equity		$	1,067,389			$	1,578,628

 

 

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

 

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WestMountain Company
Consolidated Statements of Operations and Comprehensive Income (Loss)
(Unaudited)
		Three Months Ended
		March 31,
		2015				2014
Revenue:
Advisory/consulting fees, related parties		$	53,600			$	38,000
Advisory/consulting fees			-				12,600
Total revenue			53,600				50,600
Operating expenses:
Selling, general and administrative expenses			84,381				100,264
Total operating expenses			84,381				100,264
Loss from operations			(30,781	)			(49,664	)
Other (expense) income
Interest income			1,886				-
Dividend income on non marketable securities			-				180,950
Loss on impairment of available for sale marketable securities			(193,634	)			-
Total other (expense) income			(191,748	)			180,950
Net income (loss) income before income taxes			(222,529	)			131,286
Income tax benefit			(82,460	)			(81	)
Net (loss) income		$	(140,069	)		$	131,367
Other comprehensive (loss) income
Unrealized (loss) income on investments in marketable equity securities, net of tax			(274,362	)			3,321
Comprehensive (loss) income		$	(414,431	)		$	134,688
Basic net (loss) income per share		$	(0.01	)		$	0.01
Diluted net (loss) income per share		$	(0.01	)		$	0.01
Basic weighted average common shares outstanding			9,517,402				9,517,402
Diluted weighted average common shares outstanding			9,517,402				9,601,985

 

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

 

 

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WestMountain Company
Consolidated Statements of Cash Flows
(Unaudited)
		Three months ended
		March 31,
		2015				2014
Cash flows from operating activities:
Net income (loss)		$	(140,069	)		$	131,367
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization			514				602
Deferred income tax (benefit) expense			(72,031	)			(81	)
Loss on impairment of available for sale marketable securities			193,634				-
Changes in operating assets and operating liabilities:
Prepaid expenses and other current assets			3,224				(1,675	)
Accounts receivable			(15,600	)			4,800
Accounts receivable, related parties			23,125				378,350
Accounts payable and accrued liabilities			(5,274	)			(78,983	)
Income tax receivable			(73,079	)			(8,441	)
Net cash (used in) provided by operating activities			(85,556	)			425,939
Cash flows from investing activities:
Loan to related party			(25,000	)			-
Purchases of investments			-				(52	)
Net cash used in investing activities			(25,000	)			(52	)
Net change in cash and cash equivalents			(110,556	)			425,887
Cash and cash equivalents, beginning of period			445,411				57,992
Cash and cash equivalents, end of period		$	334,855			$	483,879
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Income taxes		$	62,650			$	42,000
Interest		$	-			$	-
Non cash investing and financing activities
Unrealized loss (income) on investments in marketable equity securities, net of tax		$	274,362			$	(3,321	)

 

 

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

 

 

WestMountain Company.

Notes to Consolidated Financial Statements

(Unaudited)

(1) Nature of Organization and Summary of Significant Accounting Policies

Nature of Organization and Basis of Presentation

 

WestMountain Company, formerly known as WestMountain Asset Management, Inc. , ("we"," our" or the "Company"), was incorporated in the state of Colorado on October 18, 2007 and on this date approved its business plan and commenced operations. The consolidated financial statements include the financial information of WestMountain Company and its wholly owned subsidiaries, WestMountain Business Consulting, Inc., WestMountain Allocation Analytics, Inc. and WestMountain Valuation Services Inc. All significant intercompany accounts and transactions have been eliminated.

Unaudited Financial Information

 

The accompanying financial information as of March 31, 2015 and for the three months ended March 31, 2015 and 2014 is unaudited. In the opinion of management, all normal and recurring adjustments which are necessary to provide a fair presentation of the Company's financial position at March 31, 2015 and its operating results for the three months ended March 31, 2015 and 2014 have been made. Certain information and footnote data necessary for a fair presentation of financial position and results of operations in conformity with accounting principles generally accepted in the United States of America have been condensed or omitted. It is therefore suggested that these financial statements be read in conjunction with the summary of significant accounting policies and notes to financial statements included in the Company's annual Report on Form 10-K filed with the Securities and Exchange Commission (the "SEC") for the year ended December 31, 2014. The results of operations for the three months ended March 31, 2015 is not necessarily an indication of operating results to be expected for the year.

 

Commitments and Contingencies

 

Based on currently available information, the Company believes that it is remote that future costs related to known contingent liability exposures will exceed current accruals by an amount that would have a material adverse impact on our financial statements. As the Company learns new facts concerning contingencies, the Company reassesses its position both with respect to accrued liabilities and other potential exposures. In the case of all known contingencies, the Company accrues a liability when the loss is probable and the amount is reasonably estimable. The Company does not reduce these liabilities for potential insurance or third-party recoveries.

 

Income Tax Receivable

 

Fair Value of Financial Instruments

 

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(2)    Investments

Investments in Available for Sale Marketable Securities

The Company's investments in available for sale marketable securities as of March 31, 2015 and December 31, 2014 are summarized below.

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										As of March 31, 2015
																		Accumulated
										Share				Market/Cost				Unrealized
Company Name		Shares				Cost				Price				Value				Gain/(Loss)
Hangover Joe's Holding Corporation			868,463				99,750				0.0002				-				(99,750	)
Silver Verde May Mining Co., Inc.			246,294				46,488				0.2250			$	55,416				8,928
WestMountain Gold, Inc.			918,000				918				0.3500			$	321,300				320,382
Totals			2,032,757			$	147,156							$	376,716			$	229,560
										As of December 31, 2014
																		Accumulated
										Share				Market/Cost				Unrealized
Company Name		Shares				Cost				Price				Value				Gain/(Loss)
Omni Bio Pharmaceutical, Inc.			1,707,107			$	193,635			$	0.3695			$	630,776			$	437,141
Hangover Joe's Holding Corporation			868,463				99,750				0.0028				2,432				(97,318	)
Silver Verde May Mining Co., Inc			246,294				46,488				0.2100				51,722				5,234
WestMountain Gold, Inc.			918,000				918				0.3500				321,300				320,382
Totals			3,739,864			$	340,791							$	1,006,230			$	665,439

 

 

Investments in Nonmarketable Securities

During December 2012, NexCore Healthcare Capital Corp. entered into a restructuring whereby the Company received a stock dividend consisting of 1,645,000 Class B Units of NexCore Real Estate, LLC. NexCore Real Estate is a private company with no market for its stock. The stock dividend received in NexCore Real Estate was recorded at its cost basis which was $0. The investment in NexCore Healthcare is deemed to be nonmarketable because there is no active market for its stock. The investment in NexCore Healthcare is recorded at its original cost basis of $1,645.

During February 2012, the Company converted its $30,000 convertible note receivable into 200,000 common shares of SKRP 16, Inc. This investment is recorded at our cost of $30,000. SKRP is in the process of obtaining their ticker symbol. As no market exists for the shares, this investment is deemed an investment in nonmarketable securities and is accounted for under the cost method.

The Company's investments in nonmarketable securities accounted for under the cost method as of March 31, 2015 and December 31, 2014 are summarized below.

 

		March 31, 2015												December 31, 2014
										Market/Cost												Market/Cost
Company Name		Shares				Units				Value				Shares				Units				Value
Nonmarketable Securities:
SKRP 16, Inc.			200,000				-			$	30,000				200,000				-			$	30,000
Nexcore Real Estate LLC (Class B Units)			-				1,645,000				-								1,645,000				-
Nexcore Healthcare Capital Corp			1,645,000				-				1,645				1,645,000				-				1,645
WestMountain Distressed Debt, Inc.			80,000				-				-				80,000				-				-
Totals Shares or Units			1,925,000				1,645,000			$	31,645				1,925,000				1,645,000			$	31,645

 

 

 

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(3) Stockholders Equity

 

Common Stock

There were 9,517,402 shares of common stock outstanding as of March 31, 2015 and December 31, 2014. 

No common shares were issued or cancelled during the three months ended March 31, 2015.

 

Stock options

 

On August 15, 2012, the Company approved the employee compensation plan and granted a total of 200,000 common stock options, to our employees. As stated in the compensation plan, these options have a four year term. Fifty percent of the options became vested and exercisable immediately, 25% on the first anniversary date of August 15, 2012, and 25% on the second anniversary date of August 15, 2013. The options have an exercise price of $0.27 per share, which was the fair value of the stock on the day of the grant. The fair value of the options was determined to be $41,038 using the Black Scholes option pricing model.

The significant assumptions in the model included a risk free rate of 0.99%, a volatility input of 99.96% and using the simplified method, the expected term used in the calculation is 2.375 years. As of March 31, 2015, the full fair value of $41,038 has been expensed.

The following table presents the activity for common stock options during the three months ended March 31, 2015:

 

The weighted average remaining life of these 200,000 options as of March 31, 2015 and December 31, 2014 was 0.4 and 0.6 years respectively.

The following table presents the composition of options outstanding and exercisable as of March 31, 2015 and December 31, 2014. The exercisable options have an intrinsic value of $54,000 and $56,000 as of March 31, 2015 and December 31, 2014.

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(4) Related Parties

 

Bohemian Companies, LLC and BOCO Investments, LLC are two companies under common control.  Mr. Klemsz, our CEO, has been the Chief Investment Officer of BOCO Investments, LLC since March 2007.  Since there is common control between the two companies and a relationship with our Company President, we are considering all transactions with Bohemian Companies, LLC and BOCO Investments, LLC, related party transactions.

On January 1, 2008, we entered into a Service Agreement with Bohemian Companies, LLC to provide us with certain defined services. These services include financial, bookkeeping, accounting, legal and tax matters, as well as cash management, custody of assets, preparation of financial documents, including tax returns and checks, and coordination of professional service providers as may be necessary to carry out the matters covered by the Service Agreement.  We compensated Bohemian Companies, LLC by reimbursing this entity for the allocable portion of the direct and indirect costs of each employee of Bohemian Companies, LLC that performs services on our behalf. We received invoices monthly from Bohemian Companies, LLC. This Service Agreement was terminated by mutual agreement of the parties on March 31, 2014.  Total expenses incurred with Bohemian Companies were $-0- and $3,000 for the three months ending March 31, 2015 and 2014, respectively. As of March 31, 2015 the Company had no balance due to Bohemian Companies, LLC.

As of March 31, 2015 and December 31, 2014, the Company had $18,000 and $41,125, respectively, of accounts receivable from related parties. 

  

In 2014, the Board of Directors of NexCore Healthcare Capital Corp. authorized a $0.0675 per unit cash distribution to shareholders of record on December 1, 2014. In December 2014, the Company deposited a check in the amount of $111,038. In addition, the Board of Directors of NexCore Healthcare Capital Corp authorized a $0.025 per share cash dividend to shareholders of record on December 1, 2014. The Company received and deposited a check in the amount of $41,125 in January 2015. This amount is currently recorded as a dividend and related accounts receivable as of December 31, 2014.  The distribution was received in January, 2015.

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On January 28, 2015, we entered into a Promissory Note Agreement with WestMountain Distressed Debt, Inc., a related party, in the amount of $25,000. The note bears an interest rate of 18% per annum until paid in full. Repayment of the loan is due on or before July 28, 2015. As of March 31, 2015, the principal and interest due on the note is $25,777.

On May 4, 2015, we entered into a Promissory Note Agreement with WestMountain Distressed Debt, Inc., a related party, in the amount of $10,000. The note bears an interest rate of 18% per annum until paid in full. Repayment of the loan is due on or before November 4, 2015.

 

		March 31, 2015												December 31, 2014
										Market/Cost												Market/Cost
Company Name		Shares				Units				Value				Shares				Units				Value
Marketable Securities:
Omni Bio Pharmaceutical, Inc.		-				-				-				1,707,107				-				630,776
Hangover Joe's Holding Corporation			868,463			-				$	-				868,463				-			$	2,432
WestMountain Gold, Inc.			918,000				-				321,300				918,000				-				321,300
Total Shares or Units			1,786,463				-			$	321,300				3,493,570				-			$	982,309
Nonmarketable Securities:
Nexcore Real Estate LLC (Class B Units)			-				1,645,000			$	-				-				1,645,000			$	-
Nexcore Healthcare Capital Corp			1,645,000				-				1,645				1,645,000				-				1,645
WestMountain Distressed Debt, Inc.			80,000				-				-				80,000				-				-
Totals Shares or Units			1,725,000				1,645,000			$	1,645				1,725,000				1,645,000			$	1,645

 

 

On May 4, 2015, we entered into a Promissory Note Agreement with WestMountain Distressed Debt, Inc., a related party, in the amount of $10,000. The note bears an interest rate of 18% per annum until paid in full. Repayment of the loan is due on or before November 4, 2015.

 

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATION

The following discussion of our financial condition and results of operations should be read in conjunction with, and is qualified in its entirety by, the consolidated financial statements and notes thereto included in, Item 1 in this Quarterly Report on Form 10-Q.  This item contains forward-looking statements that involve risks and uncertainties.  Actual results may differ materially from those indicated in such forward-looking statements.

Forward-Looking Statements

 

This Quarterly Report on Form 10-Q and the documents incorporated herein by reference contain forward-looking statements. Such forward-looking statements are based on current expectations, estimates, and projections about our industry, management beliefs, and certain assumptions made by our management.  Words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates," variations of such words, and similar expressions are intended to identify such forward-looking statements.  These statements are not guarantees of future performance and are subject to certain risks, uncertainties, and assumptions that are difficult to predict; therefore, actual results may differ materially from those expressed or forecasted in any such forward-looking statements.  Unless required by law, we undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.  However, readers should carefully review the risk factors set forth herein and in other reports and documents that we file from time to time with the Securities and Exchange Commission, particularly Annual Reports on Form 10-K, Quarterly reports on Form 10-Q and any Current Reports on Form 8-K.

  

General

 

We are a fee-based marketing, media and investor relations consultant to public and private companies.

On January 1, 2008, we entered into a Service Agreement with Bohemian Companies, LLC to provide us with certain defined services. These services included financial, bookkeeping, accounting, legal and tax matters, as well as cash management, custody of assets, preparation of financial documents, including tax returns and checks, and coordination of professional service providers as may be necessary to carry out the matters covered by the Service Agreement.  We compensated Bohemian Companies, LLC by reimbursing this entity for the allocable portion of the direct and indirect costs of each employee of Bohemian Companies, LLC that performed services on our behalf. This Service Agreement was terminated by mutual agreement of the parties on March 31, 2014. 

On February 26, 2014, we amended our Articles of Incorporation to change our name to WestMountain Company. No other changes were made to our Articles of Incorporation.

Operations

As a consultant, we provide investor relations, website development, video production, and associated marketing and media services to clients. We are paid fees for our services by our clients under written consulting agreements.

 

Currently, we believe that we have sufficient capital to implement our business operations or to sustain them indefinitely. We have been profitable in the past, including the most recent fiscal quarter. If we can maintain our profitability, we could operate at our present level indefinitely. To date, we have never had any discussions with any possible acquisition candidate nor have we any intention of doing so.

 

We have not been subject to any bankruptcy, receivership or similar proceeding.

Results of Operations

 

The following discussion involves our results of operations for the three months ended March 31, 2015 and 2014.

 

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Operating expenses, consisting primarily of selling, general and administrative costs were $84,381 for the three months ended March 31, 2015, compared to $100,264 for the three months ended March 31, 2014.  The cost decrease of $15,883 over the two periods is related to contract services provided to the company. We believe that our selling, general and administrative costs will increase as we grow our business activities going forward, although we cannot predict the extent of such growth.

On January 3, 2014, NexCore Healthcare Capital Corp. declared a $0.10 per share cash dividend to holders of NexCore common stock of record on January 16, 2014. As of that date, the Company owned 1,645,000 shares of common stock and received a cash dividend of $164,500.

As of March 31, 2015, we hold nine investment positions. All the companies classified as marketable securities are publicly traded and listed on the OTC Bulletin Board. Those classified as nonmarketable are private companies or do not have an active market for their shares. The table below lists the investments and total shares owned by us as of March 31, 2015.

 

Company Name		Shares				Units
Marketable Securities:
Hangover Joe's Holding Corporation			868,463				-
Silver Verde May Mining Co., Inc.			246,294				-
WestMountain Gold, Inc.			918,000				-
Total Shares or Units			2,032,757				-
Nonmarketable Securities:
SKRP 16, Inc.			200,000				-
Nexcore Real Estate LLC Class B Units			-				1,645,000
Nexcore Real Estate LLC			1,645,000				-
WestMountain Distressed Debt, Inc.			80,000				-
Total Shares or Units			1,925,000				1,645,000
Total			3,957,757				1,645,000

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              On January 28, 2015, we entered into a Promissory Note Agreement with WestMountain Distressed Debt, Inc., a related party, in the amount of $25,000. The note bears an interest rate of 18% per annum until paid in full. Repayment of the loan was due on or before July 28, 2015. As of March 31, 2015, the principal and interest due on the note is $25,777.

Liquidity and Capital Resources

As of March 31, 2015, we had cash of $334,855.

Over the next twelve months we do not expect any material capital costs for our operations.

Currently, we believe that we have sufficient capital to implement our business operations or to sustain them at our present level indefinitely. To date, we have never had any discussions with any possible acquisition candidate nor have we any intention of doing so.

We operate out of one office in Colorado. We have no specific plans at this point for additional offices.   

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements with any party.

Critical Accounting Policies

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to use judgment in the application of accounting policies, including making estimates and assumptions. We base our estimates on historical experience and on various other assumptions believed to be reasonable under the circumstances. These judgments affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. If our judgment or interpretation of the facts and circumstances relating to various transactions had been different, it is possible that different accounting policies would have been applied resulting in a different presentation of our financial statements. From time to time, we evaluate our estimates and assumptions. In the event estimates or assumptions prove to be different from actual results, adjustments are made in subsequent periods to reflect more current information. Below is a discussion of accounting policies that we consider critical in that they may require complex judgment in their application or require estimates about matters that are inherently uncertain.

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ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

None.

ITEM 4. CONTROLS AND PROCEDURES

Not applicable.

ITEM 4T. CONTROLS AND PROCEDURES

 

 

This report does not include an attestation report by our independent registered public accounting firm regarding internal control over financial reporting.

PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

There are no legal proceedings, to which we are a party, which could have a material adverse effect on our business, financial condition or operating results.

 

ITEM 1A.  RISK FACTORS

 

You should carefully consider the risks and uncertainties described below; and all of the other information included in this document. Any of the following risks could materially adversely affect our business, financial condition or operating results and could negatively impact the value of your investment.

The occurrence of any of the following risks could materially and adversely affect our business, financial condition and operating result. In this case, the trading price of our common stock could decline and you might lose all or part of your investment.

Risks Related to Our Business and Industry

 

We have a limited operating history. We have not been profitable for our two most recent fiscal years We may never be profitable again, and, as a result, we could go out of business.

 

We were formed as a Colorado business entity in October, 2007. At the present time, we have not been profitable at our two most recent fiscal year ends, and we were not profitable in our most recent fiscal quarter. We cannot guarantee that we will be profitable again, and, as a result, we could go out of business.

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Our lack of substantial operating history makes it difficult for us to evaluate our future business prospects and make decisions based on those estimates of our future performance. An investor could lose his entire investment.

 

We have a limited operating history. An investor has no frame of reference to evaluate our future business prospects. This makes it difficult, if not impossible, to evaluate us as an investment. An investor could lose his entire investment if our future business prospects do not result in our ever becoming profitable and sustaining profitability.

If we do not generate adequate revenues to finance our operations, our business may fail.

 

We were not profitable in the last two quarters. As of March 31, 2015, we had a cash position of $334,855. We anticipate that operating costs will be approximately $380,000 for the fiscal year ending December 31, 2015. These operating costs include payroll and related costs, travel, office lease, contract services and all other costs of operations. We also use contract employees.  However, the operating costs and expected revenue generation are difficult to predict. Since there can be no assurances that revenues will be sufficient to cover operating costs for the foreseeable future, it may be necessary to raise additional funds. Due to our lack of substantial operating history, raising additional funds may be difficult.

 

Competition in our industry is intense.

 

Our business plan involves acting as a fee-based marketing and media consultant to client companies. This business is highly competitive. There are numerous similar companies providing such services in the United States of America. Our competitors will have greater financial resources and more expertise in this business. Our ability to develop our business will depend on our ability to successfully market our services in this highly competitive environment. We cannot guarantee that we will be able to do so successfully.

The share control position of WestMountain Blue, LLC will limit the ability of other shareholders to influence corporate actions.

 

Our largest shareholder, WestMountain Blue, LLC, of which Mr. Klemsz is a 16.8% member, owns 8,505,652 shares and thereby controls approximately 90% of our outstanding shares. Because WestMountain Blue, LLC individually beneficially controls more than a majority of the outstanding shares, other shareholders, individually or as a group, will be limited in their ability to effectively influence the election or removal of our directors, the supervision and management of our business or a change in control of or sale of our company, even if they believed such changes were in the best interest of our shareholders generally.

Our future success depends, in large part, on the continued service of our President and Treasurer

 

We depend almost entirely on the efforts and continued employment of Mr. Anderson, our President, and Mr. Klemsz, our Treasurer. Mr. Anderson is our primary executive officer, and we will depend on him for nearly all aspects of our operations. We do not have an employment contract with either Mr. Anderson or Mr. Klemsz, and we do not carry key person insurance on the life of either gentleman. The loss of the services of either Mr. Anderson or Mr. Klemsz through incapacity or otherwise, would have a material adverse effect on our business. It would be very difficult to find and retain qualified personnel such as either Mr. Anderson or Mr. Klemsz.

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Our success also depends upon our ability to develop relationships with our clients. If we cannot develop sufficient relationships, we may never become profitable.  An investor could lose his entire investment.

We now have one line of business. We operate as a fee-based marketing and media consultant to client companies, which include both public and private entities.  Our success now depends, in large part, on our ability to develop relationships with potential consulting services clients. We have no long-term contracts or other contractual assurances of consulting services. We may never develop sufficient consulting services clients, which would negatively impact our proposed operations. As a result, we may never become profitable or be able to sustain profitability. An investor could lose his entire investment.

Risks Related to an Investment in Our Common Stock

 

The lack of a broker or dealer to create or maintain a market in our stock could adversely impact the price and liquidity of our securities.

We have no agreement with any broker or dealer to act as a market maker for our securities and there is no assurance that we will be successful in obtaining any market makers. Thus, no broker or dealer will have an incentive to make a market for our stock. The lack of a market maker for our securities could adversely influence the market for and price of our securities, as well as your ability to dispose of, or to obtain accurate information about, and/or quotations as to the price of, our securities.

 

We have limited experience as a public company.

We have only operated as a public company since 2008. Thus, we have limited experience in complying with the various rules and regulations which are required of a public company. As a result, we may not be able to operate successfully as a public company, even if our operations are successful. We plan to comply with all of the various rules and regulations which are required of a public company. However, if we cannot operate successfully as a public company, your investment may be materially adversely affected. Our inability to operate as a public company could be the basis of your losing your entire investment in us.

 

We may be required to register under the Investment Company Act of 1940, or the Investment Advisors Act, which could increase the regulatory burden on us and could negatively affect the price and trading of our securities.

 

Because our business involves the identification, acquisition and development of investments, we may be required to register as an investment company under the Investment Company Act of 1940 or the Investment Advisors Act and analogous state law. While we believe that we are currently either not an investment company or an investment advisor or are exempt from registration as an investment company under the Investment Company Act of 1940 or the Investment Advisors Act and analogous state law, either the SEC or state regulators, or both, may disagree and could require registration either immediately or at some point in the future. As a result, there could be an increased regulatory burden on us which could negatively affect the price and trading of our securities.

 

Our stock has a limited public trading market on the OTC Bulletin Board and there is no guarantee an active trading market will ever develop for our securities.

 

There has been, and continues to be, a limited public market for our common stock. We trade under the symbol WASM. An active trading market for our shares has not, and may never develop or be sustained. If you purchase shares of common stock, you may not be able to resell those shares at or above the initial price you paid. The market price of our common stock may fluctuate significantly in response to numerous factors, some of which are beyond our control, including the following:

 

·	actual or anticipated fluctuations in our operating results;

·	changes in financial estimates by securities analysts or our failure to perform in line with such estimates;

·	changes in market valuations of other companies, particularly those that market services such as ours;

·	announcements by us or our competitors of significant innovations,  acquisitions, strategic partnerships, joint ventures or capital commitments;

·	introduction of product enhancements that reduce the need for the products our projects may develop;

·	departures of key personnel.

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Of our total outstanding shares as of March 31, 2015, a total of 8,325,000, or approximately 91.9%, will be restricted from immediate resale but may be sold into the market in the near future. This could cause the market price of our common stock to drop significantly, even if our business is doing well.

 

As restrictions on resale end, the market price of our stock could drop significantly if the holders of restricted shares sell them or are perceived by the market as intending to sell them.

 

Applicable SEC rules governing the trading of "Penny Stocks" limit the liquidity of our common stock, which may affect the trading price of our common stock.

 

Our common stock currently trades well below $5.00 per share. As a result, our common stock is considered a "penny stock" and is subject to SEC rules and regulations that impose limitations upon the manner in which our shares can be publicly traded.  These regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock and the associated risks.  Under these regulations, certain brokers who recommend such securities to persons other than established customers or certain accredited investors must make a special written suitability determination for the purchaser and receive the written purchaser's agreement to a transaction prior to purchase.  These regulations have the effect of limiting the trading activity of our common stock and reducing the liquidity of an investment in our common stock.

 

The over-the-counter market for stock such as ours is subject to extreme price and volume fluctuations.

 

The securities of companies such as ours have historically experienced extreme price and volume fluctuations during certain periods. These broad market fluctuations and other factors, such as new product developments and trends in the our industry and in the investment markets generally, as well as economic conditions and quarterly variations in our operational results, may have a negative effect on the market price of our common stock.

 

Buying low-priced penny stocks is very risky and speculative.

 

Our shares are defined as a penny stock under the Securities and Exchange Act of 1934, and rules of the Commission. The Exchange Act and such penny stock rules generally impose additional sales practice and disclosure requirements on broker-dealers who sell our securities to persons other than certain accredited investors who are, generally, institutions with assets in excess of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000, or $300,000 jointly with spouse, or in transactions not recommended by the broker-dealer. For transactions covered by the penny stock rules, a broker-dealer must make a suitability determination for each purchaser and receive the purchaser's written agreement prior to the sale. In addition, the broker-dealer must make certain mandated disclosures in penny stock transactions, including the actual sale or purchase price and actual bid and offer quotations, the compensation to be received by the broker-dealer and certain associated persons, and deliver certain disclosures required by the Commission. Consequently, the penny stock rules may affect the ability of broker-dealers to make a market in or trade our common stock and may also affect your ability to resell any shares you may purchase in the public markets.

 

Issuances of our stock could dilute current shareholders and adversely affect the market price of our common stock, if a public trading market develops.

 

We have the authority to issue up to 50,000,000 shares of common stock, 1,000,000 shares of preferred stock, and to issue options and warrants to purchase shares of our common stock without stockholder approval. Although no financing is planned currently, we may need to raise additional capital to fund operating losses. If we raise funds by issuing equity securities, our existing stockholders may experience substantial dilution. In addition, we could issue large blocks of our common stock to fend off unwanted tender offers or hostile takeovers without further stockholder approval.

The issuance of preferred stock by our board of directors could adversely affect the rights of the holders of our common stock. An issuance of preferred stock could result in a class of outstanding securities that would have preferences with respect to voting rights and dividends and in liquidation over the common stock and could, upon conversion or otherwise, have all of the rights of our common stock. Our board of directors' authority to issue preferred stock could discourage potential takeover attempts or could delay or prevent a change in control through merger, tender offer, proxy contest or otherwise by making these attempts more difficult or costly to achieve.

 

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Colorado law and our Articles of Incorporation protect our directors from certain types of lawsuits, which could make it difficult for us to recover damages from them in the event of a lawsuit.

 

Colorado law provides that our directors will not be liable to our company or to our stockholders for monetary damages for all but certain types of conduct as directors. Our Articles of Incorporation require us to indemnify our directors and officers against all damages incurred in connection with our business to the fullest extent provided or allowed by law. The exculpation provisions may have the effect of preventing stockholders from recovering damages against our directors caused by their negligence, poor judgment or other circumstances. The indemnification provisions may require our company to use our assets to defend our directors and officers against claims, including claims arising out of their negligence, poor judgment, or other circumstances.

 

We do not expect to pay dividends on common stock.

 

We have not paid any cash dividends with respect to our common stock, and it is unlikely that we will pay any dividends on our common stock in the foreseeable future. Earnings, if any, that we may realize will be retained in the business for further development and expansion.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

ITEM 5.  OTHER INFORMATION 

None

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ITEM 6.  EXHIBITS

 

ITEM 6.  EXHIBITS

 

 

 

* Previously filed with Form SB-2 Registration Statement, January 2, 2008

** Previously filed with Form 10-KSB Registration Statement, February 29, 2008

*** Previously filed under cover of Form 8K, February 27, 2014.

Reports on Form 8-K

No reports were filed under cover of Form 8-K for the fiscal quarter ended March 31, 2015.

 

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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 May 15, 2015.