UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-KSB
ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2006
COMMISSION FILE NUMBER 000-27305
GAMEPLAN, INC.
(Exact name of registrant as specified in charter)
NEVADA | 87-0493596 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
3701 Fairview Road Reno, Nevada | 89511 | |
(Address of principal executive offices) | (Zip Code) |
Registrant's telephone number, including area code: (775) 853-3980
Securities registered pursuant to section 12(b) of the Act:
Title of Class | Name of each exchange on which registered | |
NONE | NONE |
Securities registered pursuant to section 12(g) of the Act:
Common Stock, par value $.001
(Title of Class)
Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 ý No ¨
Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy of information statements incorporated by reference in Part 10-KSB or any amendment to this Form 10-KSB. ý
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act. Yes ¨ No ý
State issuer's revenues for its most recent fiscal year: $ 0.
The aggregate market value of the registrant's common stock held by non-affiliates as of December 31, 2006 was approximately $4,000. Because less than 40,000 shares of the Company's common stock has been sold within 60 days of December 31, 2006, and the Company's shares are not actively traded, the market value is based on the aggregate par value of the shares of common stock held by non-affiliates.
State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: As of March 31, 2007, the Company had outstanding was 15,225,000 shares of its common stock, par value $0.001.
TABLE OF CONTENTS
ITEM NUMBER AND CAPTION | ||
PAGE | ||
PART I | ||
ITEM 1. | Description of Business | 3 |
ITEM 2. | Description of Property | 13 |
ITEM 3. | Legal Proceedings | 13 |
ITEM 4. | Submission of Matters to a Vote of Security Holders | 13 |
PART II | ||
ITEM 5. | Market for Common Equity and Related Stockholder Matters | 13 |
ITEM 6. | Managements Discussion and Analysis or Plan of Operation | 14 |
ITEM 7. | Financial Statements and Supplementary Data | 19 |
ITEM 8. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | 36 |
ITEM 8A. | Controls and Procedures | 36 |
ITEM 8B | Other Information | 36 |
PART III | ||
ITEM 9. | Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) of the Exchange Act | 36 |
ITEM 10. | Executive Compensation | 39 |
ITEM 11. | Security Ownership of Certain Beneficial Owners and Management | 39 |
ITEM 12. | Certain Relationships and Related Transactions | 40 |
ITEM 13. | Exhibits | 41 |
ITEM 14. | Principal Accountant Fees and Services | 41 |
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PART I
ITEM 1. DESCRIPTION OF BUSINESS
Introduction
For the past several years the Company's President, Robert G. Berry, has been actively developing a comprehensive business plan for the Company. Initially, the plan focused exclusively on the use of Internet technology to offer the public a user-friendly and effective tool to seek qualified professional legal services matching specific legal needs.
During the third quarter of the Company's fiscal year ended December 31, 2000, the Company announced the completion of an expanded, comprehensive new business plan (the "New Plan"). The New Plan builds upon the Company's former concepts related to providing legal services. However, the New Plan envisions the creation of multiple new subsidiaries and/or divisions of the Company for the purpose of providing a variety of new integrated products and services including financial services, insurance products, digital escrow services, advanced digital research, two member legal service organizations of licensed attorneys using Internet-based tools for locating and engaging legal counsel and an Internet "clicks to bricks" site through which all subsidiaries can be accessed.
The focus of the several business plans is dedicated to the satisfactory resolution of potential, threatened and actual conflict through products, services, information and proprietary technology.
The mission of the several business plans is to provide efficient and win-win resolutions to conflict through a family of divergent companies representing a total available market TAM of approximately 40+% of the gross domestic product of the U.S. and to oversight each company within this business ecosystem with divergent thought and action, ethical boundless leadership, empowerment and learning models with fixed and controlled processes.
So conceived, the Company is a conglomerate of products, services, information and proprietary technology and is referred to in the Companys Web site as The Business Ecosystem.
The Company anticipates that these proposed services will be developed and provided to the consumer based upon strict adherence to the business and professional model developed by Mr. Berry. This model, known as "Integrative Conflict Resolution (ICR) is the subject of a book titled Beneath the Gavel and authored by Mr. Berry. The new e-book book has two parts. The first part focuses on the present sick system of resolving conflict with attorneys and is particularly critical of the manner in which conflict is resolved with attorneys and insurance companies. The focus of the second part is to offer specific educational, licensing, special interest, court and/or legislative reforms together with win-win action plan practice solutions, which is referred to in the Companys Web site as Public Ecosystem.
Since announcement, there have been no material developments in the business plan other than the completion of the Companys web site (http://conflictcare.com/). No elements of the New Plan have been implemented and the Company has no revenues from business operations. Implementation of the New Plan is contingent upon entering into agreements and alliances with appropriate merger and/or acquisition candidates such as lending and financial service providers, insurance providers, and other appropriate compatible companies. Significant aspects of the Company's New Plan are new and unproven in the marketplace. Accordingly, there are substantial risks and uncertainties associated with investment in the Company more fully set forth in the "Risk Factors" section below.
Summary of the New Plan
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Under the New Plan, the Company will seek either debt, equity or a combination of debt/equity financing to launch the new plan in very defined and specific steps all with appropriate benchmarks and monuments and/or strategic alliances such as mergers and/or acquisitions to develop in multiple phases a finance company, two insurance companies, two companies having a membership component for plaintiff and defense legal services, a third-party escrow company, and two legal-related Internet companies. The Company intends to adhere strictly to the certain business and professional model of Integrative Conflict Resolution Techniques, which has been expounded in the recently published book, authored by Robert G. Berry the Company's President.
The Company's "Integrative Conflict Resolution" consist of the ability of clients to choose quality insurance and financial service companies together with competent ethical lawyers having access to state-of-the-art technology and committed to a new methodology combining the best aspects of traditional conflict resolution coupled with time-tested alternative dispute resolutions "ADR," educational and special interest reforms, court reforms, practice reforms, digital communications, electronic research, adding value to every dispute within a collegial environment and a level financial and informational playing field.
The new yet to be formed subsidiaries, which may be expanded to other profitable business opportunities that the Company understands, will consist of the following all with several phases to be expanded, contracted and/or changed as market conditions dictate.
·
Legal Information and Portal Internet Company - Practical, legal information and access portals to the products and services of the Company's remaining subsidiaries to be formed.
·
Attorney Membership Subsidiary for Plaintiffs' Counsel - Attorney Dispute Support ("ADSsm") Panel Membership is a membership program limited in Phase I to contingent fee plaintiff personal injury attorneys and expanded thereafter to plaintiff attorneys in other specialized areas of the law in which compensation is lawfully and ethically contingent on the outcome of disputes.
·
Finance Company - The first phase provides pre-judgment, intangible financing ("Rights Financing") to clients of ADSsm Panel Member attorneys and Panel Members directly in appropriate cases with identifiable and reliable reparation sources. Subject to appropriate financing, this yet to be formed subsidiary will be the first subsidiary to commence business operations if strategic alliances have not been formed in the near future. Strategic alliances will still be pursued but alternative plans to launch the new plan must be implemented because of the lack of any viable strategic alliance partners at this time. Upon launch, products offered will not be limited to Panel Membership since that subsidiary will not be in existence when this finance company subsidiary has been formed.
·
E-commerce Escrow Company - The first phase is to act as an electronic escrow agent to coordinate the Rights Financing to be provided by the finance company subsidiary. The escrow subsidiary will hold the rights in trust as security for financial products from the finance company subsidiary.
·
Conflict, Legal and Financial Insurance Conflict insurance products assist insureds with potential or threatened conflict through conflict engineers. Legal insurance is to individuals in need of legal services what health insurance is to individuals in need of health care products. Legal insurance is offered to individuals, family members, home-based businesses and to employers as a fringe benefit for their employees Financial insurance products offer financial assistance to insureds at competitive interest rates.
·
Property/Casualty/Workers Compensation Insurance Company - An insurance company providing individuals and businesses insurance products and services presently not offered by any other property/casualty insurance company.
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Legal Service Organization Company - A Legal Service Organization ("LSOsm") with a membership component initially limited to fixed fee defense attorneys. The first phase is composed of member attorneys for clients insured by the Legal Insurance and Property/Casualty/Workers compensation subsidiary. Future phases will include all other areas of conflict whether covered by insurance or not and may be expanded in future phases to include fixed fee plaintiff attorneys. Only law firms will be eligible for enrollment as Approved Attorney Service Providers.
·
Banks of Value Added Solutions and Legal Briefs - A Bank of value added solutions and a brief Bank of unpublished and published legal work and court decisions in phases.
The Company's plan of operation for the next 12 months is to fund the basic requirements of the parent and foregoing subsidiaries to be formed, to seek appropriate financing to further its merger and/or acquisition strategy and to implement mergers and/or acquisitions.
The Company will continue to seek loans from its principal stockholder, a trust affiliated with Mr. Berry, to fund needed capital for development. Subject to regulatory approval, equity may be offered either publicly or privately to meet current and future obligations.
Description of the New Plan
The Parent Company
The Company's information infrastructure, or "Infostructure," provides the lifeblood of shared information across numerous differing computing platforms, networks, and differing information modalities to achieve an efficient flow of timely and accurate information.
The Infostructure houses its own Internet Service Provider ("ISP") combined with an intertwining network of computers forming separate but interlinking Virtual Private Networks ("VPN"), Intranets and Extranets, and the synthesis of firewalls, secured routers, biometric devices and in-house security procedures to maintain a secured physical and electronic environment.
The Company will employ a limited number of people. Skilled employees in informatics positions, security managers, cryptology experts, team leaders, and programmers to stay abreast of and implement emerging technologies, perform day-to-day security tasks and constantly test and monitor the security Infostructure of each subsidiary will either be employed by the Company or selected functions in whole or part may be outsourced.
The Company will house its own hardware, back up systems, proxy servers, and off-site redundant servers. Biometric personal identification in the form of retinal, finger, and facial scans will be required to access information.
The Company will have the unique ability to amass data from any subsidiary. By employing computing techniques such as pattern association, artificial intelligence, pattern matching, hypothesis testing, data clustering, genetic algorithms and other computational techniques collectively referred to as "Data Mining," the Company will be able to "drill" through the data. This Data Mining will enable the Company to monitor subsidiary performance, fiscal accountability, the success of multi-subsidiary marketing efforts, to identify and respond to rapid market changes and to comply with state and federal regulations.
Each subsidiary at the mature time will have its own VPN, Intranet, Extranet and Internet access portals that are the sole responsibility of that subsidiary, but which can be accessed by the Company for information retrieval at any time.
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The Company believes that certain of its proposed subsidiaries have no counterparts currently in operation and, therefore, must be fully funded and created with strategic alliance partners. Other proposed subsidiaries, such as the finance and the two insurance companies, could either be created or the Company could acquire or establish strategic alliance partnerships with existing financial and insurance companies or companies seeking new, significant profit centers.
Subsidiary 1-Internet Company: Legal Content and Access Portals to Other Products and Services
This subsidiary will provide legal content via the Internet and access portals to the products and services of the remaining subsidiaries to be formed turning "clicks" to "bricks." With a fixed obsession on client service, its core business is to be the leading Internet mission-specific legal information and interaction provider with hyperlinks to high-quality existing and future legal web sites and the access portal to the other subsidiaries initially contemplated to be seven and a subsidiary of the legal insurance subsidiary and possibly expanded to other yet unidentified subsidiaries to be formed.
Subsidiary 2-Attorney Membership Organization for Plaintiffs' Counsel
The core business of this subsidiary will be to provide a nationwide membership organization, to be known as Attorney Dispute Support ("ADSsm") Panel Membership (the "Panel Members") initially for attorneys specializing in plaintiff personal injury cases. Membership in phase I will be limited to contingent fee plaintiff personal injury attorneys with proven track records, unquestioned ethical standards and high esteem within their peer group and expanded thereafter to plaintiff attorneys in other specialized areas of the law in which compensation is lawfully and ethically contingent on the outcome of disputes.
A second major function of the attorney membership subsidiary will be to have in place an information network permitting prospective and retained clients to interactively communicate with ADSsm Panel Members, ADSsm Panel Members to interact with prospective and retained clients; and Panel Members to conduct research, communicate, and interact with fellow ADSsm Panel Members throughout the United States.
These information networks may be accessed using devices such as, but not limited to, telephone, fax, Internet, Web TV, AOLTV, wireless personal planning devices, telematic in-car communications and smart phones, collectively referred to as "Gateway Interface Devices."
Establishment of the information network for this subsidiary will involve the development of an informational infrastructure based on wide-band area network technologies, including access via the Internet, an Extranet, and an Intranet to:
1.
Allow clients to use Gateway Interface Devices to easily review and negotiate fees and to retain and communicate with ADSsm Panel Members.
2.
Allow attorneys to acquire new clients, easily communicate with ongoing clients and have proprietary case evaluation software and other objective criteria to evaluate cases.
3.
Allow Panel Member attorneys, through Gateway Interface Devices, access to a secure Extranet "vln-usa.com" for legal research tools, negotiation materials, and interaction with fellow ADSsm Panel Members throughout the United States, as well as access to timely legal news and current reliable information concerning national legal developments.
Personal injury clients will have the ability to easily and accurately review the qualifications of any ADSsm Panel Member and then interview and select an attorney either in their locale or attorneys having special qualifications to handle interstate matters. Moreover, ADSsm Panel Members and clients will have access to their files at any time through the secure Intranet site.
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Each ADSsm Panel Member's current resume and picture will be displayed. Panel Members may also include a brochure and voice message. A map directing clients to ADSsm Panel Member's offices will be provided.
The ADSsm Panel Member's Extranet will maintain an up-to-date calendaring and messaging service that automatically contacts the attorney over the Gateway Interface Devices upon retrieving inquires. Prompt responses by ADSsm Panel Members to all client inquiries will be a top Company priority.
Clients may access ADSsm Panel Members' special appointments calendar specifically reserved for insured clients and schedule unilateral appointments on any open day or time during the attorney's office hours.
With careful ADSsm Panel Member selection, Gateway Communication Devices, proprietary case evaluation software, objective criteria, and skilled negotiators committed to adding value to disputes, ADSsm Panel Members will be trained to resolve conflict with value added results within cost efficient time frames following the "Integrative Law/Integrative Conflict Resolution" models espoused by the Company.
ADSsm Panel Members will be charged a monthly fee yet to be determined. Additional benefits to ADSsm Panel Members will include a nationwide and local referring service involving several sources, preferential insurance programs and investment and brokerage services.
Subsidiary 3-The Finance Company
Phase I consists of a finance subsidiary providing clients of ADSsm Panel Members and directly to Panel Members pre-judgment, unliquidated, intangible "Rights Financing" to fund estate, subsidy, medical expense and cost reimbursement loans to plaintiffs' and their Panel Members in personal injury cases and will be launched when appropriate financing is in place and there are no viable strategic alliance partners with or without existing infrastructure available. Upon launch, panel membership will not be required since that subsidiary will not have been formed at the time.
This form of un-liquidated Rights financing is fraught with professional and business difficulty. In Rights Financing, the traditional criteria for extension of credit, including net worth, tangible physical assets as security and good credit are irrelevant. The sole basis for Rights Financing decisions is the strength of the plaintiff's claim to receive compensation at some undetermined time in the future. Attorney ADSsm Panel Members, who have been screened for their proven track records and high esteem within their peer group, will assist in the screening of cases to be financed by this subsidiary.
Future products of the finance company subsidiary may include, but not be limited to, expanded financing for clients and Panel Members in other subject matter conflict areas, expansion to include financing or purchasing post-judgment quasi-liquidated rights, financing cases for clients of non-Panel Members and financing or purchasing non-litigious Rights, whether tangible or intangible, liquidated or un-liquidated.
Subsidiary 4-The E-commerce Escrow Company
In the first phase, which may change depending on profitable business opportunities, this subsidiary will function as a trusted third-party escrow agent for Rights Financing and insurance by escrowing those Rights in trust as security for loan and cost reimbursement advances and insurance product lines to be provided by the legal insurance company. This subsidiary will play an integral role in following instructions provided by participants to fulfill contractual requirements in a timely manner, to authenticate both digital and lithographic documents, verify signatures and distribute good funds.
Additional escrow services in future phases set forth not by way of limitation will be made available to disburse and close additional types of Rights Financing loans, securing subrogation Rights such as, but not limited to, Medicare reimbursements, electronic litigation depositaries and Internet sales tax collections.
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Subsidiary 5-Legal Insurance Company with a dispute-engineering subsidiary
Legal insurance is to clients and attorneys what medical insurance is to patients, doctors, and hospitals. While common in Europe, legal insurance in America, with less than a 2% market penetration, is in its infancy. A prepaid legal plan works much like prepaid health insurance. Typically the insured, their employer, or both, pay a nominal fee averaging between $9.00 and $25.00 each month in return for basic legal services such as legal advice over the telephone, limited personal meetings with attorneys and review or drafting of simple legal documents. Other services not covered in the particular plan may be purchased at reduced rates.
This fifth subsidiary to be formed is a legal insurance company with its own dispute engineering/partnering subsidiary offering three core products, which may be expanded or contracted depending on market conditions and profitability. The first legal insurance product will be to provide legal insurance to individuals and all family members living at home. The second is to offer legal insurance to employers as a fringe benefit for their employees. The third is to provide legal insurance to home-based businesses. For all three legal insurance products, insured's will have access to dispute engineers offering practical, non-legal advice to prevent conflict from occurring or offering practical non-legal advice to resolve conflict after it has occurred but before it elevates to the point of requiring legal assistance. If legal assistance is needed, the insurance company, through its Legal Service Organization ("LSOsm") subsidiary, will provide attorneys for insured clients within a close-end system of Approved Attorney Service Providers ("AASPsm") for legal advice and litigation support.
All insured's will be part of an information network permitting each to interactively communicate with dispute engineers and AASP's and to permit AASP's to interact with insured's and to conduct research, communicate and interact with fellow AASP's throughout the United States with all supporting technology described for ADSsm panel members above.
The legal insurance company will also offer six financial insurance product lines expanded or contracted as market conditions dictate:
The first three specific insurance lines, which may or may not be outsourced, are limited to plaintiff clients of Attorney Dispute Support ("ADSsm") Panel Members when the financial products of the Rights Financing Subsidiary are provided.
The fourth insurance line is available to the e-escrow subsidiary of GamePlan, Inc.
The fifth insurance line is available to clients of both ADSsm and AASPsm Panel Members, which may be expanded to non-members subject to quality review.
1.
Life insurance for plaintiffs in personal injury financed cases at the option of the Rights finance company.
2.
Insurance to reimburse the finance company for financed cases that have been lost at the option of the Rights finance company.
3.
Insurance to pay income tax liabilities for financed cases that have been lost at the option of clients.
4.
Insurance to pay for un-recovered medical expense liens, which will be expanded to other professional liens in future phases.
5.
"Loser Pay" insurance provided on a self-perpetuating basis at the option of clients.
8
The sixth is to offer special insurance lines, which may or may not be outsourced, such as malpractice, life, accidental death, health, vision and dental insurance to ADSsm Panel Members and AASPsm panel members, their associates and all employees.
Subsidiary 6-Property/Casualty/Worker's Compensation Insurance Subsidiary
Following the business philosophy of "integrated law/integrated dispute resolutions" and with a fixed obsession on client satisfaction, this subsidiary's core business is selling property/casualty/worker's compensation insurance through a unique business model having five parts:
1.
Property/casualty/worker's compensation insurance company offering individuals and businesses insurance products and services presently not offered by any other property/casualty insurance company in the U.S.
2.
Staffing the company with professional, skilled claims management conflict negotiators focusing on value added negotiated solutions and who have full authority to settle legitimate claims.
3.
Provide creative financial products adding value to legitimate conflict resolution and early appropriate dispute mechanisms.
4.
To secure subordination liens and then collect those liens when reparations have been paid to their first party insured clients. This insurance company will insure that all liens are properly secured and collected. If legal action is required, Legal Services Organization ("LSOsm") members will process the matter.
5.
Refer all claims in which a lawsuit has been filed to the LSOsm that has multiple functions, including the selection, monitoring and paying of all fixed costs and attorneys' fees of AASP's for covered first and third-party insurance claims.
Subsidiary 7-Legal Service Organization Company
This subsidiary to be formed is a legal service organization company ("LSOsm") with an approved closed-end system of Approved Attorney Service Providers. It will have multiple specific responsibilities for the LSO's property/casualty/workman's client. For its legal insurance subsidiary client, it will provide legal advice and litigation support.
Following the Company's business philosophy of Integrative Law/Integrated Conflict value added negotiation and with a focus on client satisfaction, this subsidiary's core business is to provide active case management in the defense of personal injury litigation through an LSOsm. Future phases will include all other areas of conflict whether covered by insurance or not and may be expanded in future phases to include fixed fee plaintiff attorneys. Only law firms will be eligible for enrollment as Approved Attorney Service Providers.
Controlling fees and costs is of great importance in insurance defense work. Some insurance companies have overreacted by imposing unreasonable fee capitation agreements. The function of this company will be to provide a balance between the two extremes.
Its initial two clients, each called "The Signatory Company," are the Legal Insurance and Property/Casualty/Worker's Compensation Insurance subsidiaries of the Company to be formed.
Similar case management services will be available to other competitive insurance companies and to corporate America in later phases.
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Litigation support responsibilities provided to the Property/Casualty/Worker's Compensation Signatory Company, which may be expanded or contracted as market conditions dictate, will initially include:
·
The first responsibility is to hire a nationwide panel of Approved Attorney Service Providers and insure that they follow the terms and conditions of their panel member agreements.
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The second responsibility is to assign lawsuits from the Signatory Company to selected Approved Attorney Service Providers "AASPsm."
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The third responsibility is to insure that approved service attorney providers have compatible computer programs with opposing counsel and the courts.
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The fourth responsibility is to co-ordinate Cumis Counsel.
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The fifth responsibility is to verify medical specials.
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The sixth responsibility is to facilitate communication and research between clients and AASPsm panel members.
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The seventh responsibility is to monitor work in progress.
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The eighth responsibility is to co-ordinate settlement discussions with skilled AASPsm members.
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The ninth responsibility is to present financial value added products during settlement negotiations.
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The tenth responsibility is to co-ordinate settlement discussions.
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The eleventh responsibility is to co-ordinate negotiation or ADR of procedural and substantive matters if negotiation does not lead to resolution.
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The twelfth responsibility is to aggressively pursue subrogation lien collections as well as seeking and collecting cost and attorney fee awards.
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The thirteenth responsibility is to co-ordinate all evaluations
An information network similar to ADSsm will support this subsidiary allowing panel members previously described permitting insured clients, professional claims personnel and Approved Attorney Service Providers to interactively communicate with each other and for Panel Members to interact with fellow Panel Members throughout the United States.
Subsidiary 8-Knowledge Banks of Value-Added Solutions and Legal Briefs
The service products of this subsidiary will be a bank of value-added solutions and a bank of unpublished and published briefs in phases.
The first subsidiary, counselorsweb.com, is an Internet company. With the business philosophy of integrative law/integrative dispute value added resolution techniques and with a focus on client satisfaction, the core business of this Internet company subsidiary has two purposes in the first phase:
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The professional and public retrieval of value added dispute resolution solutions.
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The professional and public retrieval of unpublished legal briefs and court decisions.
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This subsidiary will have two banks, one for value-added solution retrieval and the other for brief retrievals. The first will consist of a bank of value-added solutions reported by Panel Members, claims personnel and dispute engineers throughout the United States, which will be available to anyone, anywhere in the world for a fee. The second will be a brief bank of unpublished briefs and supporting data used by Panel Members and shared with other Panel Members through a secure Extranet.
Patents, Service Marks, Domain Names and Licenses
Service Marks
The Company has applied for the following service marks. The notation "sm" means a U.S. Patent and service mark that has been applied for and approval is pending. Because of the lack of activity the U.S. Patent Office has classified these service marks as Dead. Accordingly, the marks are not current and there can be no assurance that they will be re-issued at any time in the future.
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AASPsm means panel members "Approved Attorney Service Providers" selected in a close-ended system and paid by the Legal Service Organization "LSOsm" consisting initially of fixed fee defense counsel but to be expanded to fixed fee plaintiff counsel in future phases.
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ADSsm means panel member "Attorney Dispute Support" for plaintiff attorneys, limited in Phase I to contingent fee plaintiff personal injury attorneys and expanded thereafter to plaintiff attorneys in other specialized areas of the law in which their compensation is lawfully and ethically contingent on the outcome of the dispute.
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AISsm means "The Program of Anticipation Integration and Solutions," which anticipates disputes and assists in value added conflict prevention. If conflict arises, either pre-negotiated solutions are in place or value added concepts are integrated to assist in conflict resolution. Initially, AISsm will be staffed with dispute engineers in the legal insurance subsidiary and a subsidiary of that subsidiary.
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ILFsm means "The Integrative Law Forum" an Internal Revenue Service approved ss.501 (c) (3) public charitable foundation established for the study and practice of integrative law, integrative negotiation and legislative and judicial awareness forums funded by public and private donations, referral fees from ADSsm panel members and 5% of the pre-tax profit of the LSOsm.
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LSOsm means the "Legal Services Organization" that, among several other functions, selects Panel Member Approved Attorney Service Providers. In the first phase, it processes and pays capitated defense attorney's fees and costs for the property/causality company. The LSOsm also processes claims and selects and pays attorneys who advise and represent insured's in the legal insurance subsidiary. Future phases will include offering services to other insurance companies, Corporate America and capitated plaintiff attorney's fees.
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Netocracysm means a government of informed, responsible people by fulfilled people for people in a wired world.
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PLAsm means "The Program for Legal Assistance" an Internal Revenue Service approved ss.501 (c) (3) public charitable foundation dedicated to providing pro-bono legal services and the enforcement of public sector laws funded by public and private donations and 5% of the pre-tax profits of both the Rights financing bank and the property/casualty/workman/s compensation insurance company.
Domain Names
The Company has obtained the following domain names. All are in the process of being discontinued except for GamePlan-usa.com
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1stbanknetusa.com - The finance company subsidiary.
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1stinsurancenet.com - The property/causality/workman's compensation subsidiary.
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1stnetbankusa.com - To protect the finance company subsidiary domain name.
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1stnetinsurance.com -To protect property/casualty/workman's compensation domain name
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1stnetlegalinsurance.com - The legal insurance subsidiary.
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1stnetocracy.com - The guiding principle behind the public books and the private business opportunities.
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alcoholchat.com - Interactive chat room to introduce participants to Netocracysm.
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aasp-usa.com - Approved Attorney Service Provider "AASPsm" Defense Panel Members.
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adr-usa.com - Appropriate Dispute Resolution.
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ads-usa.net - Attorney Dispute Support "ADSsm" Plaintiff Panel Members.
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bidcase.com - Allows ADSsm Panel Member attorneys to bid for cases.
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calendarsonline.net - Electronic calendar coordination with professionals.
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casebasereasoning.com - Determining case values using artificial intelligence.
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case-bid.com - Allows clients to post facts of their case and solicit fee quotes from ADSsm Panel Member attorneys.
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counselorsweb.com - Main Internet site for interactive communications and the access portal to the subsidiaries of GamePlan, Inc.
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enlargethepie.com - Value added practical and finance products offered by ADSsm, professional claims representatives of the property/casualty/workman's compensation insurance company, and AASPsm members of LSOsm.
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esqlynx.com - The Bank for value added solutions and unpublished Brief Banks.
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financeescrow.com - The e-commerce escrow company.
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gameplan-usa.com - To protect the name of the parent company.
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conflictcare.com The parent companys primary business website.
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ilf-usa.org - "Integrative Law Forum" "ILFsm", is an approvedss.501(c)(3) public charitable foundation.
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integrativelaw.com - Its essence is a new way to resolve conflict. Claims personnel will practice integrative dispute added value resolutions in the property/causality/workman's compensation subsidiary and dispute engineers will follow its principles for the legal insurance subsidiary as well.
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lawescrow.com - To protect the name of the e-commerce Internet escrow company.
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lawintegrative.com - To protect the name
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lso-usa.com - The LSOsm for the property/causality/workman's compensation insurance company and the legal insurance company.
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lynxesq.com - To protect the name of the Bank for value-added solutions and unpublished briefs.
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pla-usa.org - "The Program of Legal Assistance" "PLAsm," is an approvedss.501(c)(3) public charitable foundation.
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usa-ais.com - Anticipation, Integration and Solutions "AISsm." These functions are performed by dispute engineers employed by a subsidiary of the legal insurance subsidiary and consist of anticipating conflict and integrating value added dispute resolution techniques to reach acceptable value added solutions.
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vln-usa.com - "Virtual Law Network." Two separate secure Extranets for ADSsm and AASPsm Panel Members for information, communication and research.
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vpn-usa.com - "Virtual Private Network". A secure Intranet for unilateral file access to monitor the status of all cases. Clients will also be able to securely access their files unilaterally.
Patents
Berry Development L.L.C. ("Berry LLC") is a Nevada Limited Liability Corporation owned by The Robert G. Berry Trust, the Company's principal shareholder.
Berry LLC has filed four provisional and one complete patent application. There is no assurance that the filed patent will result in granted claims. There can be no assurance that the provisional patents will ripen to completed patents within one year of filing and there can be no assurance that, if filed, claims will be granted.
Berry LLC may or may not remain as a separate entity. If it remains separate, a license agreement between the Company and Berry LLC will be required. No license agreements have been negotiated.
ITEM 2. DESCRIPTION OF PROPERTY
The corporate office and telephone number for the Company are the personal residence and telephone number of Mr. Robert G. Berry, currently the sole officer and principal shareholder of the Company.
ITEM 3. LEGAL PROCEEDINGS
The Company is not a party to any threatened or pending legal action.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to a vote of the shareholders during the fiscal year 2006.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
13
The common stock is quoted on the over-the-counter market (OTC BB) under the symbol "GPLA" and quoted in the pink sheets published by the National Quotations Bureau.
Our common shares are designated as penny stock and thus may be more illiquid. The SEC has adopted rules (Rules 15g-2 through l5g-6 of the Exchange Act), which regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks generally are any non-NASDAQ equity securities with a price of less than $5.00, subject to certain exceptions. The penny stock rules require a broker-dealer to deliver a standardized risk disclosure document prepared by the SEC, to provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, monthly account statements showing the market value of each penny stock held in the customers account, to make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchasers written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a stock that is subject to the penny stock rules. Since our common shares are subject to the penny stock rules, persons holding or receiving such shares may find it more difficult to sell their shares. The market liquidity for the shares could be severely and adversely affected by limiting the ability of broker-dealers to sell the shares and the ability of shareholders to sell their stock in any secondary market.
The trading volume in the Common Stock has been and is extremely limited. The limited nature of the trading market can create the potential for significant changes in the trading price for the Common Stock as a result of relatively minor changes in the supply and demand for Common Stock and perhaps without regard to our business activities. Because of the lack of specific transaction information and our belief that quotations during the period were particularly sensitive to actual or anticipated volume of supply and demand, we do not believe that such quotations during this period are reliable indicators of a trading market for the Common Stock.
The market price of our common stock may be subject to significant fluctuations in response to numerous factors, including: variations in our annual or quarterly financial results or those of our competitors; conditions in the economy in general; announcements of key developments by competitors; loss of key personnel; unfavorable publicity affecting our industry or us; adverse legal events affecting us; and sales of our common stock by existing stockholders.
As of March 31, 2007, there were approximately 90 holders of record of the Company's common stock. This number excludes the number of beneficial owners of shares, if any, held in street name.
We have not paid any dividends to date. We can make no assurance that our proposed operations will result in sufficient revenues to enable profitable operations or to generate positive cash flow. For the foreseeable future, we anticipate that we will use any funds available to finance the growth of our operations and that we will not pay cash dividends to stockholders. The payment of dividends, if any, in the future is within the discretion of the Board of Directors and will depend on our earnings, capital requirements, restrictions imposed by lenders and financial condition and other relevant factors.
RECENT SALES OF UNREGISTERED SECURITIES
None
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Forward Looking Statements
From time to time, our representatives or we have made or may make forward-looking statements, orally or in writing. Such forward-looking statements may be included in, but not limited to, press releases, oral statements made with the approval of an authorized executive officer or in various filings made by us with the Securities and Exchange Commission. Words or phrases "will likely result", "are expected to", "will continue", "is anticipated", "estimate", "project or projected", or similar expressions are intended to identify "forward-looking statements". Such statements are qualified in their entirety by reference to and are accompanied by the above discussion of certain important factors that could cause actual results to differ materially from such forward-looking statements.
14
Management is currently unaware of any trends or conditions other than those mentioned in this management's discussion and analysis that could have a material adverse effect on the Company's consolidated financial position, future results of operations, or liquidity. However, investors should also be aware of factors that could have a negative impact on the Company's prospects and the consistency of progress in the areas of revenue generation, liquidity, and generation of capital resources. These include: (i) variations in revenue, (ii) possible inability to attract investors for its equity securities or otherwise raise adequate funds from any source should the Company seek to do so, (iii) increased governmental regulation, (iv) increased competition, (v) unfavorable outcomes to litigation involving the Company or to which the Company may become a party in the future and, (vi) a very competitive and rapidly changing operating environment.
The risks identified here are not all inclusive. New risk factors emerge from time to time and it is not possible for management to predict all of such risk factors, nor can it assess the impact of all such risk factors on the Company's business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. Accordingly, forward-looking statements should not be relied upon as a prediction of actual results.
The financial information set forth in the following discussion should be read with the financial statements of Gameplan, Inc. included elsewhere herein.
Plan of Operation
Since announcement of the New Business Plan, which is set forth in Item 1. Description of Business located elsewhere in this Annual Report on Form 10-KSB for the fiscal year ended December 31, 2006 there have been no material developments towards implementation, funding, or development of the New Plan. No elements of the New Plan have been implemented except for the completion of the Companys website (http://conflictcare.com/), and the Company has no revenues from business operations. The Company is in the process of actively seeking merger and/or acquisitions of existing companies. These merger and acquisition activities are contingent on the Companys ability to raise substantial amounts of capital, locating and hiring a qualified management team, engaging multiple third-party service providers to design and implement a complex, Internet-based, information handling system for the Company and its proposed family of subsidiaries, and entering into agreements and alliances with attorneys, lending and financial service providers, insurance providers, and other risk-management professionals. Significant aspects of the Companys New Plan are new and unproven in the marketplace. The Company will also pursue other acquisitions completely unrelated to the New Plan as well. Accordingly, there are substantial risks and uncertainties associated with investment in the Company which are more fully set forth in the Risk Factors section below of this Annual Report.
There may be market or other barriers to entry or unforeseen factors, which could render the New Plan to be not feasible. Accordingly, the Company may refine, rewrite, or abandon some or all elements of the New Plan, which might benefit the Company and its shareholders.
Apart from any cash requirements necessary to implement the New Plan, the Company will continue to incur expenses relating to maintenance of the Company in good standing, filing required reports with the SEC and other regulatory agencies, and investigating potential business ventures. The Company believes that such additional maintenance expenses will be advanced by management or principal stockholders as loans to the Company. However, there can be no assurance that the management or stockholders will continue to advance operating funds to the Company.
Risk Factors
15
An investment in our Common Stock involves risk. You should carefully consider the risks described below in addition to the other information presented in this Report before deciding to invest in our Common Stock. The risks and uncertainties described below are not the only ones facing the Company. Additional risks and uncertainties not presently known to us or that we currently deem immaterial but could be material may also impair our business operations. If any of the following risks actually occur, our business, financial condition, or results of operations could be materially adversely affected.
We have no operating history upon which to evaluate our likelihood of success.
We have an unproven and untested business plan only. You should consider our business and prospects in light of the risks and uncertainties encountered by technology companies in evaluating whether to invest in our Company. There are many reasons why we may not be successful in implementing our strategy including but not limited to:
·
Significant funding will be required to implement its merger and/or acquisition strategy when it does not have existing cash flow, and the worth of the ideas cannot be proven without funding.
·
The inability to design the Internet and computer-based infrastructure contemplated in our New Plan necessary to provide the array of legal, insurance, and financial products discussed in the New Plan;
·
The inability to achieve market acceptance of our products and services;
·
The need to enter into contracts with and to rely on third-party providers for certain components of our services;
·
The need to assemble a management team and support personnel for the Company and its subsidiaries;
·
The inability to respond effectively to competitive pressures;
·
The loss of key personnel;
·
The failure to comply with governmental regulations.
·
The plan in its entirety is very difficult to understand. Considerable effort will be required to acquaint financial and securities people with its details. Many will resist the difficult task of spending the time necessary to fully understand every aspect.
·
Components and talent are in short supply. The proper execution of this plan will require thousands of highly qualified, trained people. To recruit and keep the talent necessary may be extremely difficult.
·
Departing employees will have the knowledge of selected portions of important confidential business plans. Even with the most strict confidentiality agreements, which are unenforceable in many states, the business plans will be shopped to competitors compromising corporate strategy.
·
Since our clients, Panel Members and actual or potential adversaries likely will be among the most litigious people in society, the Company may need to devote significant resources to respond to claims brought against the Company.
·
The company will be subject to the highest public profile leading to constant legislative and regulatory scrutiny.
·
New legislation and regulations may be required to fully implement The Company's plan.
16
Additional challenges may arise from:
·
Tort reform advocates, organizations and lobbies.
·
Attorneys resisting career changes.
·
Existing property and casualty insurers with vested interests and huge financial resources.
·
Redundant insurance adjusters and claims support personnel.
·
Court reporters.
·
Bail bondsman.
·
Existing companies purchasing viatical and quasi-viatical settlements.
·
Existing companies purchasing structured settlements.
·
Existing companies offering value added products that are not part of this proposal.
·
Existing companies specializing in insurance for attorneys.
·
Existing companies specializing in managing attorney investment and pension funds.
·
Existing companies financing loans to clients.
We have a history of losses and an accumulated deficit and this trend of losses may continue in the future.
For the fiscal year ended December 31, 2006 we had a net loss of $57,510 and an accumulated deficit of $1,386,240. Our ability to obtain and sustain profitability will depend, in part, upon the successful marketing of our proposed new products and services and the successful and timely introduction of new products. We can give no assurances that we will achieve profitability or, if achieved, that we will sustain profitability.
Our business will depend on consumer acceptance of our computer and internet-based legal services and business models.
Our success will depend in large part on our ability to successfully encourage the legal profession, consumers, prospective clients and private and public agencies to switch from traditional methods of processing conflict with lawyers, insurance, financial and other support services to our proposed new methods. If our methods are not accepted in the market, our business may be materially adversely affected.
Changes in technology could negatively impact our financial performance.
The use of the Internet, and the use of intertwining networks of computers forming Virtual Private Networks, Intranets, and Extranets, together with devices and procedures to maintain secured physical and electronic environments, is characterized by rapid technological change. As technological changes occur in the marketplace, we may have to modify our hardware, software, products or services in order to become or remain competitive or to ensure that our products do not become obsolete. Assuming our Company begins to generate profits, if we fail to anticipate or respond in a cost-effective and timely manner to professional ethical requirements and government requirements, market trends or customer demands, or if there are any significant delays in product development or introduction, our revenues and profit margins may decline which could adversely affect our cash flows, liquidity and operating results.
17
We may have problems raising the money needed in the future.
Our growth strategy includes mergers and/or acquisitions and/or the formation, development, staffing and financing of a family of electronically interconnected legal service, financial, and insurance companies. The Company and its proposed subsidiaries will not be viable without significant equity and/or debt financing. We are currently exploring alternatives to fulfill these requirements, including the sale of debt or equity securities together with private investment company funds to support its merger and acquisition activities but cannot assure that financing will be available when needed or that, if available, it will be on terms favorable to us or our stockholders. If needed funds are not available, we may be unable to implement the New Plan and the family of service subsidiaries contemplated by the plan. We may be required to take other actions that may lessen the value of our Common Stock, including borrowing money on terms that are not favorable to us. If we raise the needed funds through the sale of additional shares of our Common Stock or securities convertible into shares of our Common Stock dilution to current stockholders may result.
We are subject to competition.
The market for legal, financial, and insurance products and services is highly competitive. Competition in the market for such products and services may intensify in the future. Numerous well-established companies and smaller entrepreneurial companies are focusing significant resources on developing and marketing products and services that compete, at least indirectly, with our products and services. Although the Company believes that its new approach to providing such services as set forth in the New Plan is unique, other companies might attempt to copy our methods and techniques once they are implemented and we begin to generate revenues. In addition, many of our current and potential competitors have greater financial, technical, operational, and marketing resources. We may not be able to compete successfully against these competitors in developing our technology, products and services. Competitive pressures may also force prices for our services down and such price reductions may affect our potential future revenue.
Future growth may place strains on our managerial, operational and financial resources.
If we grow as expected, a significant strain on our managerial, operational and financial resources may occur. Further, as the number of our affiliated Panel Membership attorneys, clients, advertisers, and finance, insurance and other business partners grows, we will be required to manage complex multiple relationships. To date, the Company has been managed by only one man serving as the sole officer and director of the Company. The Company must retain many new qualified officers and employees to successfully implement the New Plan. We cannot guarantee that the Company will be able to locate, attract, and hire the management and staff personnel necessary to commence and sustain commercial operations.
The Company does not intend to pay dividends.
The Company does not anticipate paying any cash dividends on its Common Stock to its shareholders for the foreseeable future. The Company intends to retain future earnings, if any, for use in the operation and expansion of its business. In addition, it is possible that any debt financing agreements entered into by the Company may contain restrictions on the Company's ability to declare dividends.
The Company has not retained information technology consultants to design its information infrastructure.
18
If mergers and/or acquisitions do not occur, implementation of the New Plan will require the Company to engage information technology consultants to design and implement the information-handling infrastructure for the Company's system. To date, no specific design or implementation work has been undertaken. Such work would require the Company to raise substantial additional funds, to conduct research and development, purchase or lease equipment, and to develop the secure digital information system necessary to begin operations. We expect to begin fundraising efforts shortly, and will consider a variety of funding sources, including private investments, joint venturing, and traditional venture capital. To date, however, no agreements have been made, nor potential investors identified, regarding additional capital for the Company. We can give no assurance that the Company will be able to raise the capital necessary to pursue its business plan.
There may be no support for our products and services in the market.
There may be market or other barriers to entry or unforeseen factors that make the concepts set forth in our New Plan unfeasible. For this reason, we might refine, rewrite, expand, contract or abandon some or all elements of the Plan. In conjunction with the Plan, or as an alternative thereto, we will continue to consider acquisition or merger opportunities with existing businesses that might benefit the Company and its shareholders. Such acquisitions may create business opportunities for the Company completely unrelated to the New Plan.
New Accounting Pronouncements
Gameplan does not expect the adoption of recently issued accounting pronouncements to have a significant impact on Gameplans results of operations, financial position, or cash flow.
ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
19
INDEX TO FINANCIAL STATEMENTS
TABLE OF CONTENTS
Page | |
Report of Independent Registered Public Accounting Firm | F-1 |
Consolidated Balance Sheet December 31, 2006 | F-2 |
Consolidated Statements of Operations for the Years Ended December 31, 2006 and 2005 and for the Period From Inception [April 27, 1984] through December 31, 2006 | F-3 |
Consolidated Statements of Stockholders Equity/(Deficit) for the Period from Inception [April 27, 1984] through December 31, 2006 | F-4 |
Consolidated Statements of Stockholders Equity/(Deficit) for the Period from Inception [April 27, 1984] through December 31, 2006 | F-5 |
Consolidated Statements of Cash Flows for the Years Ended December 31, 2006 and 2005 and for the Period from Inception [April 27, 1984] through December 31, 2006 | F-6 |
Notes to Consolidated Financial Statements | F-7 |
20
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Directors and Shareholders
GamePlan, Inc.
We have audited the consolidated balance sheet of GamePlan, Inc. [a development stage company] and its wholly owned subsidiary, Gameplaninc.com, as of December 31, 2006, and the related consolidated statements of operations, stockholders' deficit, and cash flows for the years ended December 31, 2006 and 2005, and the period from inception [April 27, 1984] through December 31, 2006. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. The financial statements of GamePlan, Inc. for the period from inception [April 27, 1984] through December 31, 1992, were audited by other auditors whose report dated March 31, 1993, expressed an unqualified opinion on those statements. We have previously audited the financial statements of GamePlan, Inc., since 1992, and expressed unqualified opinions on those statements in our reports.
We conducted our audit in accordance with auditing standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company has determined that it is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for expressing an opinion on the effectiveness of the Companys internal controls over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of GamePlan, Inc. [a development stage company] as of December 31, 2006, and the results of operations and cash flows for the years ended December 31, 2006 and 2005, and for the period from inception [April 27, 1984] through December 31, 2006, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that GamePlan, Inc. will continue as a going concern. As discussed in Note 4 to the financial statements, the Company has experienced recurring losses from operations since its inception and has a net working capital deficiency which raises substantial doubt about its ability to continue as a going concern. Managements plans in regard to these matters are also described in Note 4. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
\s\ Mantyla McReynolds, LLC
Mantyla McReynolds, LLC
Salt Lake City, Utah
March 29, 2007
F-1
GAMEPLAN, INC.
[A Development Stage Company]
Consolidated Balance Sheet
December 31, 2006
ASSETS | ||
2006 | ||
Current Assets | ||
Cash | $ | 1,126 |
Total Current Assets | 1,126 | |
Fixed Assets | ||
Property & Equipment | 1,604 | |
Accumulated Depreciation | (1,604) | |
Total Fixed Assets | 0 | |
Total Assets | $ | 1,126 |
LIABILITIES AND STOCKHOLDERS DEFICIT | ||
Liabilities | ||
Current Liabilities | ||
Accounts Payable | 680 | |
Total Current Liabilities | 680 | |
Long-Term Liabilities | ||
Payable to Shareholder | 643,895 | |
Total Long-Term Liabilities | 643,895 | |
Total Liabilities | 644,575 | |
Stockholders Deficit | ||
Common stock, $.001 par value, 40,000,000 shares authorized, 15,225,000 issued and outstanding at December 31, 2006 | 15,225 | |
Additional Paid in Capital | 727,566 | |
Deficit accumulated during development stage | (1,386,240) | |
Total Stockholders Deficit | (643,449) | |
Total Liabilities and Stockholders Deficit | $ | 1,126 |
See accompanying notes to financial statements
F-2
GAMEPLAN, INC.
[A Development Stage Company]
Consolidated Statements of Operations
For the Years Ended December 31, 2006 and 2005
and for the Period from Inception [April 27, 1984] through December 31, 2006
For the Year | For the Year | |||||||
ended | Ended | |||||||
December 31, | December 31, | Inception to | ||||||
2006 | 2005 | 12/31/06 | ||||||
Revenues | ||||||||
Consulting fees | $ | 0 | $ | 0 | $ | 768,042 | ||
Commissions | 0 | 0 | 137,034 | |||||
Book Sales | 0 | 40 | 40 | |||||
Other Income | 0 | 0 | 27,168 | |||||
Total Revenue | 0 | 40 | 932,284 | |||||
Expenses | ||||||||
General and Administrative | 11,241 | 20,230 | 2,075,502 | |||||
Total Expenses | 11,241 | 20,230 | 2,075,502 | |||||
Operating Loss | (11,241) | (20,190) | (1,143,218) | |||||
Other Income and Expenses | ||||||||
Interest Income | 0 | 0 | 16,064 | |||||
Interest Expense | (46,269) | (41,935) | (628,445) | |||||
Gain/(loss) on sale of assets | 0 | 0 | (29,477) | |||||
Total Other Income/(Expense) | (46,269) | (41,935) | (641,858) | |||||
Net Loss Before Taxes | (57,510) | (62,125) | (1,785,076) | |||||
Income Taxes | 0 | 0 | 1,164 | |||||
Net Loss Before Extraordinary Items | (57,510) | (62,125) | (1,786,240) | |||||
Extraordinary Item | ||||||||
Lost Opportunity settlement | 0 | 0 | 400,000 | |||||
Net Income From Extraordinary Items | 0 | 0 | 400,000 | |||||
Net Loss | $ | (57,510) | $ | (62,125) | $ | (1,386,240) | ||
Loss Per Share from continuing operations | ||||||||
Before Extraordinary item | $ | (0.01) | $ | (0.01) | $ | (0.21) | ||
Extraordinary item | 0.00 | 0.00 | 0.05 | |||||
Income/(Loss) per share Basic and Diluted | (0.01) | (0.01) | (0.16) | |||||
Weighted Average Shares Outstanding Basic and Diluted | 15,225,000 | 15,225,000 | 8,426,832 |
See accompanying notes to financial statements
F-3
GAMEPLAN, INC.
[A Development Stage Company]
Consolidated Statements of Stockholders' Equity/(Deficit)
For the Period from Inception [April 27, 1984] through December 31, 2006
|
| Common | Common | Additional Paid | Accumulated | Net | ||||||||
Balance at Inception, April 27, 1984 |
| 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||
Issued 750,000 shares of common stock for cash |
| 750,000 |
| 750 |
| 2,250 |
|
| 3,000 | |||||
Issued 2,500,000 shares of common stock for cash |
| 2,500,000 |
| 2,500 |
| 19,569 |
|
| 22,069 | |||||
Issued 29,250,000 shares of common stock for cash, 12/31/091 |
| 29,250,000 |
| 29,250 |
|
|
| 29,250 | ||||||
Reverse split [1 for 5] of 32,500,000 shares of common stock outstanding |
| (26,000,000) |
| (26,000) |
| 26,000 |
|
| 0 | |||||
Expenses of merger and stock issuance |
|
|
| (17,028) |
|
| (17,028) | |||||||
Accumulated deficit from inception through December 31, 1991 |
|
|
|
| (5,621) |
| (5,621) | |||||||
Balance, December 31, 1991 |
| 6,500,000 |
| 6,500 |
| 30,791 |
| (5,621) |
| 31,670 | ||||
|
|
|
|
|
| |||||||||
Net Loss 1992 |
|
|
|
| (326,738) |
| (326,738) | |||||||
Balance, December 31, 1992 |
| 6,500,000 |
| 6,500 |
| 30,791 |
| (332,359) |
| (295,068) | ||||
Issued 1,200,000 shares of restricted common stock in satisfaction of debt, December 30, 1993 |
| 1,200,000 |
| 1,200 |
| 248,800 |
|
| 250,000 | |||||
Net Loss 1993 |
|
|
|
| (305,062) |
| (305,062) | |||||||
Balance, December 31, 1993 |
| 7,700,000 |
| 7,700 |
| 279,591 |
| (637,421) |
| (350,130) | ||||
Net Loss, 1994 |
|
|
|
| (306,974) |
| (306,974) | |||||||
Balance, December 31, 1994 |
| 7,700,000 |
| 7,700 |
| 279,591 |
| (944,395) |
| (657,104) | ||||
Net Loss, 1995 |
|
|
|
| (215,677) |
| (215,677) | |||||||
Balance, December 31, 1995 |
| 7,700,000 |
| 7,700 |
| 279,591 |
| (1,160,072) |
| (872,781) | ||||
Issued 4,500,00 shares of common stock in satisfaction of debt, October 7, 1996 |
| 4,500,000 |
| 4,500 |
| 445,500 |
|
| 450,000 | |||||
Net Income, 1996 |
|
|
|
| 277,209 |
| 277,209 | |||||||
Balance, December 31, 1996 |
| 12,200,000 |
| 12,200 |
| 725,091 |
| (882,863) |
| (145,572) | ||||
Net loss, 1997 |
|
|
|
| (46,264) |
| (46,264) | |||||||
Balance, December 31, 1997 |
| 12,200,000 |
| 12,200 |
| 725,091 |
| (929,127) |
| (191,836) |
See accompanying notes to financial statements
F-4
GAMEPLAN, INC.
[A Development Stage Company]
Consolidated Statements of Stockholders' Equity/(Deficit)
For the Period from Inception [April 27, 1984] through December 31, 2006
[continued]
|
| Common |
Common |
Additional Paid |
Accumulated | Net | ||||||||
Issued 3,000,000 shares of common stock for R&D |
| 3,000,000 |
| 3,000 |
|
|
| 3,000 | ||||||
Net Loss, 1998 |
|
|
|
| (47,807) |
| (47,807) | |||||||
Balance, December 31, 1998 |
| 15,200,000 |
| 15,200 |
| 725,091 |
| (976,934) |
| (236,643) | ||||
Issued 25,000 shares of common stock for cash |
| 25,000 |
| 25 |
| 2,475 |
|
| 2,500 | |||||
Net Loss, 1999 |
|
|
|
| (46,310) |
| (46,310) | |||||||
Balance, December 31, 1999 |
| 15,225,000 |
| 15,225 |
| 727,566 |
| (1,023,244) |
| (280,453) | ||||
Net Loss, 2000 |
|
|
|
| (77,320) |
| (77,320) | |||||||
Balance, December 31, 2000 |
| 15,225,000 |
| 15,225 |
| 727,566 |
| (1,100,564) |
| (357,773) | ||||
Net loss, 2001 |
|
|
|
| (49,232) |
| (49,232) | |||||||
Balance, December 31, 2001 |
| 15,225,000 |
| 15,225 |
| 727,566 |
| (1,149,796) |
| (407,005) | ||||
Net loss, 2002 |
|
|
|
| (35,273) |
| (35,273) | |||||||
Balance, December 31, 2002 |
| 15,225,000 |
| 15,225 |
| 727,566 |
| (1,185,069) |
| (442,278) | ||||
Net Loss, 2003 |
|
|
|
| (36,325) |
| (36,325) | |||||||
Balance, December 31, 2003 |
| 15,225,000 |
| 15,225 |
| 727,566 |
| (1,221,394) |
| (478,603) | ||||
Net loss, 2004 |
|
|
|
| (45,212) |
| (45,212) | |||||||
Balance, December 31, 2004 |
| 15,225,000 |
| 15,225 |
| 727,566 |
| (1,266,606) |
| (523,815) | ||||
Net loss, 2005 |
|
|
|
|
|
| (62,125) |
| (62,125) | |||||
Balance, December 31, 2005 | 15,225,000 | 15,225 | 727,566 | (1,328,730) | (585,939) | |||||||||
Net loss, 2006 | (57,510) | (57,510) | ||||||||||||
Balance, December 31, 2006 | 15,225,000 | 15,225 | 727,566 | (1,386,240) | (643,449) |
See accompanying notes to financial statements
F-5
GAMEPLAN, INC.
[A Development Stage Company]
Consolidated Statements of Cash Flows
For the Years Ended December 31, 2006 and 2005
and for the Period from Inception [April 27, 1984] through December 31, 2006
For the Year | For the Year | Inception to December 31, | ||||||
Cash Flows From Operating Activities | ||||||||
Net Loss | $ | (57,510) | $ | (62,125) | $ | (1,386,240) | ||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||
Depreciation | 0 | 0 | 174,645 | |||||
Bad debt expense | 0 | 0 | 911 | |||||
Notes issued in exchange for interest expense | 0 | 0 | 59,588 | |||||
Notes issued in exchange for accrued interest | 0 | 0 | 49,589 | |||||
Issued common stock for development cost | 0 | 0 | 3,000 | |||||
Loss/(gain) on disposal of property & equipment | 0 | 0 | 29,477 | |||||
Increase/(decrease) in accrued expenses | 45,949 | 41,936 | 278,037 | |||||
Net Cash Provided by/(used for) Operating Activities | (11,561) | (20,189) | (790,993) | |||||
Cash Flows Provided by/(used) From Investing Activities | ||||||||
Capital expenditures | 0 | 0 | (520,761) | |||||
Proceeds from disposal of property and equipment | 0 | 0 | 316,641 | |||||
Net Cash Provided by/(used for) Investing Activities | 0 | 0 | (204,120) | |||||
Cash Flows Provided by/(used for) Financing Activities | ||||||||
Proceeds from loans from related party | 12,500 | 20,000 | 1,487,467 | |||||
Loan principal payments | 0 | 0 | (531,018) | |||||
Proceeds from the issuance of common stock | 0 | 0 | 39,791 | |||||
Net Cash Provided by/(Used for) Financing Activities | 12,500 | 20,000 | 996,240 | |||||
Net increase/(decrease) in cash | 939 | (189) | 1,126 | |||||
Beginning Cash Balance | 187 | 376 | 0 | |||||
Ending Cash Balance | $ | 1,126 | $ | 187 | $ | 1,126 | ||
Supplemental Discloser of Cash Flow Information: | ||||||||
Cash paid during the year for interest | $ | 0 | $ | 0 | $ | 0 |
See accompanying notes to financial statements
F-6
GAMEPLAN, INC.
[A Development Stage Company]
Notes to Consolidated Financial Statements
December 31, 2006
NOTE 1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(A)
Organization
The Company was originally incorporated under the laws of the State of Utah on August 26, 1981, as Sunbeam Solar, Inc. The Company was dormant until April 27, 1984, at which time common stock was issued. On December 23, 1991, the Company entered into a plan of merger with GamePlan, Inc., a Nevada corporation. GamePlan, Inc. was the surviving corporation. The transaction was accounted for as a reverse acquisition on a purchase basis. Results of operations have been combined for all periods presented.
The Company is considered to be in the development stage as defined in Financial Accounting Standards Board Statement No. 7. It has yet to commence full-scale operations and it continues to develop its planned principle operations. During 1997, and in prior years, the Company earned revenues primarily from consulting fees.
On September 22, 1999, the Company created a wholly-owned subsidiary, in the State of Nevada, under the name "Gameplaninc.com". The Company resolved that it will transfer, assign, or convey all assets, liabilities and operations to the subsidiary at an appropriate time. As of the date of this report, nothing has been conveyed. The financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles. The consolidated financial statements of the Company include the accounts of GamePlan, Inc. and its subsidiary. All significant intercompany transactions have been eliminated. The following summarizes the more significant of such policies:
(B)
Cash
Cash consists of cash on deposit in commercial banks. As of December 31, 2006, the Company had $1,126 in cash deposits.
(C)
Property and Equipment
Property and equipment are stated at cost less accumulated depreciation. Depreciation is provided using the straight-line method over the useful lives of the related assets of five to ten years. Expenditures for repair and maintenance are charged to expense as incurred.
F-7
GAMEPLAN, INC.
[A Development Stage Company]
Notes to Consolidated Financial Statements
December 31, 2006
NOTE 1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [continued]
(D)
Loss per Share
In accordance with Financial Accounting Standard No. 128, Earnings per Share, basic loss per common share is computed using the weighted average number of common shares plus dilutive common share equivalents outstanding during the period using the treasury stock method. There are outstanding options for purchase of common stock as of December 31, 2006, but as the Company has an operating loss, a loss per share calculation including those options would be anti-dilutive and is not presented. The total potential dilutive stock equivalents outstanding at December 31, 2006 were 100,000. See Note 6 for more information regarding outstanding stock options.
(E)
Use of Estimates in Preparation of Financial Statements
The preparation of financial statements in conformity with U. S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
F)
Revenue Recognition
The Company recognizes revenues in accordance with the Securities and Exchange Commission, Staff Accounting Bulletin (SAB) number 104, Revenue Recognition. SAB 104 clarifies application of U. S. generally accepted accounting principles to revenue transactions. Revenue from the sale of electronic books is recognized when funds are reasonable assured and the products are delivered to the customer or retailer. The Company had no revenues during the period ending December 31, 2006 or 2005.
(G)
Income Taxes
The Company applies Statement of Financial Accounting Standard (SFAS) No. 109, "Accounting for Income Taxes," which requires the asset and liability method of accounting for income taxes. The asset and liability method requires that the current or deferred tax consequences of all events recognized in the financial statements are measured by applying the provisions of enacted tax laws to determine the amount of taxes payable or refundable currently or in future years. (See Note 5 below).
(H)
Fair Value of Financial Instruments
All cash and cash equivalents, accounts payable, and accrued liabilities are carried at approximate fair market value.
F-8
GAMEPLAN, INC.
[A Development Stage Company]
Notes to Consolidated Financial Statements
December 31, 2006
NOTE 1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [continued]
(I)
Stock Options
Prior to January 1, 2006, the Company accounted for share-based payments to employees using Accounting Principles Board Opinion No. 25 (APB 25), Accounting for Stock Issued to Employees and, as a result, the Company measured stock-based employee compensation using the intrinsic value method. On December 19, 2004, the Financial Accounting Standards Board issued SFAS No. 123(R), Share-Based Payments, which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. For public companies that file as small business issuers, the reporting requirements under SFAS No. 123(R) became effective January 1, 2006. The Company adopted the provisions of SFAS No. 123(R) as of January 1, 2006.
Following the provisions of SFAS No. 123(R), the Company has adopted the modified prospective method of accounting and reporting for share-based payments and the Company recognizes the related cost of an option over the period during which an employee is required to provide the requisite service. The prior periods have not been restated for stock compensation based on estimates of fair value of options. The Company has estimated the fair value of options using the Black-Scholes option valuation model. The use of this valuation model requires the use of accounting judgment and financial estimates, including estimates of the expected term employees will retain their vested options before exercising them, the estimated volatility of our stock price, and the number of options that will be forfeited prior to the completion of their vesting requirements.
(I)
Impact of New Accounting Standards
In February 2006, the FASB issued SFAS 155, Accounting for Certain Hybrid Financial Instruments, which amends SFAS 133, Accounting for Derivative Instruments and Hedging Activities and SFAS 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities. SFAS 155 simplifies the accounting for certain derivatives embedded in other financial instruments by allowing them to be accounted for as a whole if the holder elects to account for the whole instrument on a fair value basis. SFAS 155 also clarifies and amends certain other provisions of SFAS 133 and SFAS 140. SFAS 155 is effective for all financial instruments acquired, issued or subject to a re-measurement event occurring in fiscal years beginning after September 15, 2006 and is therefore required to be adopted by the Company as of January 1, 2007. The Company does not anticipate the adoption of SFAS 155 will have any impact on its financial statements.
In March 2006, the FASB issued SFAS 156, Accounting for Servicing of Financial Assets, an amendment of SFAS 140. This clarifies when to separately account for servicing rights, requires servicing rights to be separately recognized initially at fair value, and provides the option of subsequent accounting for servicing rights at either fair value or under the amortization method. The standard is effective for fiscal years beginning after September 15, 2006 but can be adopted early. The Company does not anticipate the adoption of SFAS 156 will have a material impact on its financial statements.
F-9
GAMEPLAN, INC.
[A Development Stage Company]
Notes to Consolidated Financial Statements
December 31, 2006
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [continued]
(I)
Impact of New Accounting Standards [continued]
In June 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109 (FIN 48). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in a companys financial statements and prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This Interpretation also provides related guidance on de-recognition, classification, interest and penalties, accounting in interim periods and disclosure. FIN 48 is effective for us beginning January 1, 2007. The Company is currently evaluating the impact of this standard.
In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. This statement addresses how to calculate fair value measurements required or permitted under other accounting pronouncements. Accordingly, this statement does not require any new fair value measurements. However, for some entities, the application of the statement will change current practice. SFAS No. 157 is effective for us beginning January 1, 2008. The Company is currently evaluating the impact of this standard.
In September 2006, the FASB issued SFAS 158, Employers Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements 87, 88, 106 and 132(R) (SFAS 158). SFAS 158 requires an employer to recognize the over-funded or under-funded status of a defined benefit postretirement plan (other than a multiemployer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income. SFAS 158 also requires the measurement of defined benefit plan assets and obligations as of the date of the employers fiscal year-end statement of financial position (with limited exceptions). Management does not expect adoption of SFAS 158 to have a material impact on the Companys financial statements.
In September 2006, the Securities and Exchange Commission (SEC) staff issued Staff Accounting Bulletin No. 108 (SAB 108), Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. The stated purpose of SAB 108 is to provide consistency between how registrants quantify financial statement misstatements. Prior to the issuance of SAB 108, there have been two widely-used methods, known as the roll-over and iron curtain methods, of quantifying the effects of financial statement misstatements. The roll-over method quantifies the amount by which the current year income statement is misstated while the iron curtain method quantifies the error as the cumulative amount by which the current year balance sheet is misstated. Neither of these methods considers the impact of misstatements on the financial statements as a whole. SAB 108 established an approach that requires quantification of financial statement misstatements based on the effects of the misstatement on each of the Companys financial statements and the related financial statement disclosures. This approach is referred to as the dual approach as it requires quantification of errors under both the roll-over and iron curtain methods. SAB 108 allows registrants to initially apply the dual approach by either retroactively adjusting prior financial statements as if the dual approach had always been used, or by recording the cumulative effect of initially applying the dual approach as adjustments to the carrying values of assets and liabilities as of January 1, 2006 with an offsetting adjustment recorded to the opening balance of retained earnings. We do not believe the adoption of SAB 108 will have a significant effect on our financial statements.
F-10
GAMEPLAN, INC.
[A Development Stage Company]
Notes to Consolidated Financial Statements
December 31, 2006
NOTE 1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [continued]
(I)
Impact of New Accounting Standards [continued]
SFAS 159 In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities, including an amendment of FASB Statement No. 115 (SFAS 159). SFAS 159 creates a fair value option allowing an entity to irrevocably elect fair value as the initial and subsequent measurement attribute for certain financial assets and financial liabilities, with changes in fair value recognized in earnings as they occur. SFAS 159 also requires an entity to report those financial assets and financial liabilities measured at fair value in a manner that separates those reported fair values from the carrying amounts of assets and liabilities measured using another measurement attribute on the face of the statement of financial position. Lastly, SFAS 159 requires an entity to provide information that would allow users to understand the effect on earnings of changes in the fair value on those instruments selected for the fair value election. SFAS 159 is effective for fiscal years beginning after November 15, 2007 (January 1, 2008 for the Bank), with early adoption permitted. The Company is continuing to evaluate SFAS 159 and to assess the impact on its results of operations and financial condition if an election is made to adopt the standard.
NOTE 2
PROPERTY AND EQUIPMENT
Property and equipment are summarized as follows:
Balance | Useful Life | Method | ||||
Computer Equipment | 1,604 | 5 | Straight-line | |||
Accumulated Depreciation | (1,604) | |||||
Net Fixed Assets | - |
All fixed assets have been fully depreciated since 2004 and therefore, there has been no depreciation expense for either 2006 or 2005.
F-11
GAMEPLAN, INC.
[A Development Stage Company]
Notes to Consolidated Financial Statements
December 31, 2006
NOTE 3
RELATED-PARTY TRANSACTIONS
Note Payable to Shareholders
The amount payable to shareholders includes unsecured balances due to two shareholders of the Company, for amounts loaned or advanced to the Company, plus accrued interest on those loans. The loans bear interest at the rate of the Wall Street Journal Prime plus 2%. Each loan has been evidenced by a note. The original notes have been superseded to provide for compounding of interest and extending maturity dates. Principal and interest are due at maturity with no penalty for prepayment. Below is a summary of the outstanding balance due as of December 31, 2006.
Principle | Interest | Additional | Total | Maturity Date | ||||
200,010 | 289,612 | 43,658 | 533,280 | March 1, 2008 | ||||
10,890 | 89,610 | 10,115 | 110,615 | March 1, 2008 | ||||
210,900 | 379,222 | 53,773 | 643,895 |
The first note is payable to the Companys president. On February 17, 1996, the Company issued notes totaling $695,500, which extended the maturity date on a prior loan. On October 7, 1996, the Company issued 3,500,000 shares of $.001 par value common stock in satisfaction of $350,000 of the note payable and paid a principal reduction of $260,890 in cash. The Company paid an additional principal reduction of $20,000 on October 16, 1996. Since 1996, additional advances of approximately $135,400 have been made to the Company to pay operating, general and administrative expenses.
The second note is payable to another investor. This was originally an unsecured note payable to two other individuals. Principal of $245,000, along with accrued interest, were due to be paid on or before October 1, 1994. During November, 1994, the Company paid principal of $45,000 along with $19,600 accrued interest, and renewed the remaining principal balance of $200,000. On October 7, 1996, the Company issued 1,000,000 shares of $.001 par value common stock in satisfaction of $100,000 of the note payable and paid an additional $89,110 in cash. The Company issued a new promissory note for the remaining principal plus interest. In February, 1999, this note plus the right to receive all accrued interest was assigned to two shareholders of the Company. A series of new notes have been written naming those individuals and compounded interest through March 1, 2008. The Company has recorded accrued interest on this note through December 31, 2006.
F-12
GAMEPLAN, INC.
[A Development Stage Company]
Notes to Consolidated Financial Statements
December 31, 2006
NOTE 4
LIQUIDITY/GOING CONCERN
The Company has incurred losses from inception amounting to $1,386,240, has a net working capital deficit, and has no operating revenue source as of December 31, 2006. Financing the Companys activities to date has primarily been the result of borrowing from shareholders and others. The Companys ability to achieve a level of profitable operations and/or additional financing may impact the Companys ability to continue as it is presently organized. Managements plans include developing the business purpose, as discussed in NOTE 7, and keeping the corporation in good standing for the foreseeable future.
The Company is open to other potential business activities including mergers and acquisitions outside of its current business plan.
NOTE 5
ACCOUNTING FOR TAXES
The provision for income taxes consists of the following:
Current Taxes | $ | - | |
Deferred Tax Benefit | (7,261) | ||
Benefits of operating loss carryforwards | 7,261 | ||
$ | - |
Any deferred tax benefits arising from operating losses carried forward would be offset entirely by a valuation allowance since it is not likely that the Company will be sufficiently profitable in the future to take advantage of the losses carried forward. Net operating loss carry forward amounts expire at various times through 2026.
Deferred Tax Asset | Estimated NOL | Rate | Tax | |||||
Federal loss carryforward | $ | 1,177,685 | 34% | $ | 400,413 | |||
Accrued Related Party Interest | 237,301 | 34% | $ | 80,682 | ||||
Valuation Allowance | $ | (481,095) | ||||||
$ | 0 |
This valuation allowance has increased $ 19,553 during the period ending December 31, 2006.
Reconciliation between expected taxes and the actual income tax provision for continuing operations follows:
Expected Provision Based on Statutory Rates | $ | (19,553) |
Effect of: | ||
Change in Valuation allowance | 19,553 | |
Total Actual Provision | $ | (0) |
F-13
GAMEPLAN, INC.
[A Development Stage Company]
Notes to Consolidated Financial Statements
December 31, 2006
NOTE 6
STOCK OPTIONS
On February 10, 1997, the Company entered into stock option agreements with two directors of the Company. The options provided for the purchase of a total of 50,000 shares, in two 25,000 share lots, of Company common stock at $.10 per share. On February 4, 1999 one of the options was exercised. The other option expired on February 10, 1999.
On January 9, 1998 the directors entered into a stock option contract with another individual as consideration for assistance in developing a business concept. The option contract allowed the purchase of 100,000 shares of stock at $1 per share if the business concept was developed and successfully sold. The options expired unexercised in January, 2005.
On August 11, 2004, the Company entered into a stock option agreement with a director of the Company. The options provide for the purchase of the 100,000 shares of Company common stock at $0.05 per share.
All outstanding options vested in 2004 and were accounted for under APB 25. During 2006, no option-related compensation expense was recorded for 2006 because no new options were granted and all existing options had fully vested in prior years.
The following table summarizes stock option activity of the plan:
Number of | Weighted | Weighted | Aggregate | ||||||
Outstanding at December 31, 2005 | 100,000 | $ | 0.05 | 19 | |||||
Activity during the period: | |||||||||
Granted | -- | $ | -- | ||||||
Exercised | -- | $ | -- | ||||||
Canceled/Expired | -- | $ | -- | ||||||
Outstanding at December 31, 2006 | 100,000 | $ | 0.05 | 7 | -- | ||||
Exercisable at December 31, 2006 | 100,000 | $ | 0.05 | 7 | -- |
No options were exercised during the period ending December 31, 2006 or 2005.
F-14
GAMEPLAN, INC.
[A Development Stage Company]
Notes to Consolidated Financial Statements
December 31, 2006
NOTE 7
BUSINESS PURPOSE
The Company, concluding that its prior business purpose was not viable long term, ceased its gaming consulting operations in 1996. Since that time, the Companys majority shareholder has developed several new business plans supported by statistics and numerous un-coded software programs. The several business plans set forth, in detail, a new methodology for dispute resolution in the United States. It consists of GamePlan, Inc., as the parent company with several subsidiaries to be formed, including two membership plans, a Rights financing company, two insurance companies, an escrow company, an electronic brief bank retrieval, and a legal website providing useful information and the access portal to Gameplan, Inc., and its subsidiaries to be formed as more fully described in Part I, Item 1 "Description of Business" of the Companys 10-KSB annual report.
Numerous service marks have been approved as well as registration of approximately 28 electronic commerce addresses.
The Company has not been successful in identifying suitable merger and/or acquisition candidates. While the Company continues to believe that this strategy will forward the business of the Company rapidly, because our several business models are conceptual only and without an operating history, our merger/acquisition activities have not been received favorably. While the Company will continue its search for viable and suitable merger and/or acquisition candidates for the foreseeable future, the Company cannot delay the implementation of any part of its business plan any longer. Accordingly, the company will immediately seek debt/equity or a combination of debt/equity financing to create and launch the Rights Financing subsidiary as more fully described in Part I, Item I "Description of Business" of the Company's 10-KSB annual report.
F-15
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None
ITEM 8A. CONTROLS AND PROCEDURES
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in company reports filed or submitted under the Securities Exchange Act of 1934 (the Exchange Act) is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commissions rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in company reports filed under the Exchange Act is accumulated and communicated to management, including the Companys Chief Executive Officer and Chief Financial Officer (the Certifying Officers), as appropriate to allow timely decisions regarding required disclosure.
As required by Rules 13a-15 and 15d-15 under the Exchange Act, the Certifying Officers carried out an evaluation of the effectiveness of the design and operation of the Companys disclosure controls and procedures as of December 31, 2006. Their evaluation was carried out with the participation of other members of the Companys management. Based upon their evaluation, the Certifying Officers concluded that the Companys disclosure controls and procedures were effective.
The Companys internal control over financial reporting is a process designed by, or under the supervision of, the Certifying Officers and effected by the Companys Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of the Companys financial reporting and the preparation of the Companys financial statements for external purposes in accordance with generally accepted accounting principles. Internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the Companys assets; provide reasonable assurance that transactions are recorded as necessary to permit preparation of the Companys financial statements in accordance with generally accepted accounting principles, and that the Companys receipts and expenditures are being made only in accordance with the authorization of the Companys Board of Directors and management; and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Companys assets that could have a material effect on its financial statements. There has been no change in the Companys internal control over financial reporting that occurred in the fiscal year ended December 31, 2006, that has materially affected, or is reasonably likely to affect, the Companys internal control over financial reporting.
ITEM 8B. OTHER INFORMATION
There is no information to be disclosed in a report on Form 8-K during the fourth quarter of the year covered by this Form 10-KSB that has not been previously filed with the Securities and Exchange Commission.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
The following table sets forth information concerning our directors and the executive officer of Gameplan, Inc. and their age and positions. Each director holds office until the next annual stockholders' meeting and thereafter until the individual's successor is elected and qualified. Officers serve at the pleasure of the board of directors.
36
NAME | AGE | POSITION | ||
Robert G. Berry | 71 | Chief Executive Officer, President, Secretary and Director | ||
John Sien | 58 | Director |
Mr. Berry received a BA degree from the University of Nevada in 1961, and a JD degree from the University of Notre Dame law school in 1963. After spending four years in the District Attorney's office in Reno, Nevada, Mr. Berry joined the law firm of Laxalt and Berry in Carson City, Nevada. Mr. Berry's areas of emphasis while in private practice were plaintiff's personal injury litigation and regulatory work. While practicing law, Mr. Berry entered into a number of business ventures, including shopping center and condominium development, restaurants, cattle feeding and breeding. Mr. Berry left the active practice of law in 1977 and engaged in more than 50 business ventures and operations. After a brief retirement, Mr. Berry attended Harvard Law School's Program on Negotiation and Mediation in 1996. In 1997, he received training in commercial mediation from A.D.R. Inc., and advance mediation from the John Paul Jones Group. At present, Mr. Berry is a Nevada Supreme Court Settlement Judge, a private mediator, a special master and lectures on negotiation and mediation advocacy skills.
During the quarter ended September 30, 2004 Mr. John Sien was appointed to our Board of Directors. In conjunction with his appointment the Company granted him an option to purchase 100,000 shares of the common stock of GamePlan at $0.05 per share. The grant of option date was August 11, 2004 and is for a period of three (3) years from the date of the option grant.
Mr. Sien, was Vice President, Strategic Alliances, for Micromuse, Incorporated of San Francisco, CA, a leading provider of business, network, security, and IT management solutions. Prior to joining Micromuse, Micromuse was acquired by IBM and Mr. Sien is presently an executive with IBM. Mr. Sien was President of Sien & Associates LLC, where he provided business planning, technology consulting, and investment sourcing services to Gameplan, Inc as well as economic development consulting services to the public sector. In addition, Mr. Sien has held executive and senior management positions at Hewlett Packard Company including Vice President, Corporate Accounts, Managing Principal, HP Consulting and Integration, and General Manager of Operations, Sales and Marketing for HP Components Group. Mr. Sien brings extensive executive management, general management, sales, and marketing experience to Gameplans Board of Directors. He spent the majority of his career working in Silicon Valley. He is skilled in software, hardware, and services solutions in Information Technology, Network Technology, Business Processes, and Web Services. Mr. Sien has a Bachelors Degree in Electrical Technology with a Business Administration minor. He is a certified Business Retention and Expansion Consultant and member of BREI. He is also on the Advisory Board of the University Of Nevada College of Engineering.
During the last five years, no officers or directors have been involved in any legal proceedings, bankruptcy proceedings, criminal proceedings or violated any federal or state securities or commodities laws or engaged in any activity that would limit their involvement in any type of business, securities or banking activities.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Exchange Act requires the Company's directors and executive officers, and persons who own more than 10% of the outstanding shares of the Company's Common Stock, to file initial reports of beneficial ownership and reports of changes in beneficial ownership of shares of Common Stock with the Commission. Such persons are required by Commission regulations to furnish the Company with copies of all Section 16(a) forms they file.
No person who, at any time during our past fiscal year, was a director, officer, or beneficial owner of more than 10% of any class of equity securities failed to file, on a timely basis, any report required by Section 16(a) of the Exchange Act during the most recent fiscal year.
AUDIT COMMITTEE AND FINANCIAL EXPERT
37
We do not have an Audit Committee. The Company's directors perform some of the same functions of an Audit Committee, such as; recommending a firm of independent certified public accountants to audit the financial statements; reviewing the auditors' independence, the financial statements and their audit report; and reviewing management's administration of the system of internal accounting controls. The Company does not currently have a written audit committee charter or similar document.
We have no audit committee financial expert. We believe the cost related to retaining a financial expert at this time is prohibitive. Further, because of our start-up operations, we believe the services of a financial expert are not warranted.
CODE OF ETHICS
A code of ethics relates to written standards that are reasonably designed to deter wrongdoing and to promote:
1)
Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships.
2)
Full, fair, accurate, timely and understandable disclosure in reports and documents that are filed with, or submitted to the Securities and Exchange Commission and in other public communications made by the Company.
3)
Compliance with applicable government laws, rules and regulations.
4)
The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and
5)
Accountability for adherence to the code.
We have not adopted a formal code of ethics statement. The board of directors evaluated the business of the company and the number of employees and determined that since the business is operated by a small number of persons who are also the officers and directors and many of the persons employed by the company are independent contractors general rules of fiduciary duty and federal and state criminal, business conduct and securities laws are adequate ethical guidelines.
SHAREHOLDER-DIRECTOR COMMUNICATION
We have neither a nominating committee for persons to be proposed as directors for election to the board of directors nor a formal method of communicating nominees from shareholders. We do not have any restrictions on shareholder nominations under our certificate of incorporation or by-laws. The only restrictions are those applicable generally under Nevada Corporate Law and the federal proxy rules. Currently the board of directors decides on nominees, on the recommendation of one or more members of the board. The board of directors will consider suggestions from individual shareholders, subject to evaluation of the person's merits. Stockholders may communicate nominee suggestions directly to any of the board members, accompanied by biographical details and a statement of support for the nominees. The suggested nominee must also provide a statement of consent to being considered for nomination. Although there are no formal criteria for nominees, the board of directors believes that persons should be actively engaged in business endeavors, have a financial background, and be familiar with acquisition strategies and money management.
Because the management and directors of the Company are the same persons, the board of directors has determined not to adopt a formal methodology for communications from shareholders on the belief that any communication would be brought to the boards' attention by virtue of the co-extensive employment.
38
The board of directors does not have a formal policy of attendance of directors at the annual meeting. It does encourage such attendance. The Company did not have an annual meeting in 2006.
ITEM 10. EXECUTIVE COMPENSATION
For several years, we have not paid any cash compensation to our executive officers. The only form of compensation paid to our executive officers for the development of the New Plan has been the issuance of shares of our common stock. Cash compensation amounts will be determined in the future based on the services to be rendered and time devoted to our business and the availability of funds. Other elements of compensation, if any, will be determined at that time or at other times in the future.
Until we have sufficient capital or revenues, Mr. Berry will not be provided cash remuneration. At such time as we are able to provide a regular salary, it is our intention that Mr. Berry will become employed pursuant to an executive employment agreement, at an annual salary to be determined based on his then level of time devoted to Gameplan, Inc. and the scope of his responsibilities. At the appropriate time, consideration will be given to bonus compensation to Mr. Berry for the development of the New Plan. Until we enter into an employment agreement, we may use additional shares of common stock to compensate Mr. Berry. In addition, we may use common stock to compensate others for services to the Company.
COMPENSATION OF DIRECTORS
Persons who are directors and employees will not be additionally compensated for their services as a director. In 2005, Mr. John Sien was appointed to our Board of Directors. Mr. Sien is not an employee and was granted an option to purchase 100,000 shares of the common stock of GamePlan at $0.05 per share.
There is no plan in place for compensation of persons who are directors who are not employees, but it is expected that in the future we will create a remuneration and expense reimbursement plan. It is anticipated that such a plan would be primarily based on stock options.
OTHER COMPENSATION ARRANGEMENTS
The Company does not currently have any other form of compensation arrangements.
ITEM 11.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of March 31, 2007, the name and shareholdings of each person who owns of record, or was known by us to own beneficially,* 5% or more of the shares of the common stock currently issued and outstanding; the name and shareholdings, including options to acquire the common stock, of each director; and the shareholdings of all executive officers and directors as a group. Each of the persons in the table below has sole voting power and sole dispositive power as to all of the shares shown as beneficially owned by them, except as otherwise indicated.
NAME OF PERSON OR GROUP | NUMBER OF | PERCENTAGE | ||
Robert G. Berry (1) | 6,030,500 | 39.6% | ||
Jon T. Jenkins (2) | 6,030,500 | 39.6% | ||
Jon Sien (3) | 0 | 0.0% | ||
All executive officers and directors as a group (one person) | 6,030,500 | 39.6% |
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______________
*
Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. Shares of common stock issuable upon the exercise of options or warrants currently exercisable or convertible within 60 days, are deemed outstanding for computing the percentage ownership of the person holding such options or warrants but are not deemed outstanding for computing the percentage ownership of any other person. All percentages are calculated based upon a total number of shares issued and outstanding as of March 31, 2007, which number of shares is 15,225,000.
(1)
Mr. Berrys address is 3701 Fairview Road Reno, Nevada 89511. The Robert G. Berry Trust holds the shares. Robert G. Berry is the trustee of the trust and has the sole power and authority to vote or dispose of the shares of Common Stock held by the trust.
(2)
Mr. Jenkins address is 5717 East Almeda Court, Cave Creek, AZ 85331. Jon T. Jenkins owns 5,640,500 shares in his individual capacity, and has the authority to vote or dispose of, as trustee, 390,000 shares held in trust for family members.
(3)
Mr. Siens address is 14275 Sorrel Lane, Reno, NV. 89511. On August 11, 2004, Mr. Sien, a director, was granted an option to purchase 100,000 shares of the common stock of GamePlan at $0.05 per share.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Robert G. Berry Promissory Note
On February 1, 1999, the Company entered into an amended and restated promissory note with Robert Berry, pursuant to which the Company agreed to pay Mr. Berry principal then owing to Mr. Berry of $182,256, representing Mr. Berry's unreimbursed cash advances to the Company as of that date. The Note was due February 1, 2001 and bore interest at the rate of prime plus 2%. During 1999, Mr. Berry advanced the Company $17,600. A new note was executed on February 1, 2000, which extended the maturity date to February 1, 2002. In 2000, Mr. Berry advanced $37,200 to the Company. The Company executed a further amended and restated note with Mr. Berry on January 1, 2001, which note replaced and superceded all previous notes of the Company payable to Mr. Berry. The new note was issued in the principal amount of $290,192.44, bore interest at the rate of prime plus 2%, and extends the maturity of the Company's obligations to Mr. Berry to February 1, 2003. The entire unpaid principal and interest was due at maturity. Additionally, the Company executed a further amended and restated note with Mr. Berry on January 1, 2002, which note replaces and supercedes all previous notes of the Company payable to Mr. Berry. The new note was issued in the principal amount of $327,407.84, bears interest at the rate of prime plus 2%, and maintained the maturity of the Company's obligations to Mr. Berry at February 1, 2003. Mr. Berry renewed this promissory note in the total amount of $484,626 after calculating additional advances to Jan. 1, 2006. The entire unpaid principal and interest is due on or before March 1, 2008. Mr. Berry is the indirect owner of approximately 39.6% of the issued and outstanding shares of the Company.
Jon Jenkins Promissory Note
As of February 1, 2001, the Company entered into an amended and restated promissory note payable to Jon and April Jenkins in the principal amount of $74,054.36. The note replaced and supercedes all previous notes of the Company payable to Jon or April Jenkins. The note bears interest at the rate of prime plus 2%. All principal and interest is due and payable on February 1, 2003. Mr. Jenkins agreed to renew this note in the total amount of $100,500 after calculating interest to Jan. 1, 2006. The entire unpaid principal and interest is due on or before March 1, 2008. Jon Jenkins is the beneficial and indirect owner of approximately 20% of the issued and outstanding shares of the Company.
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ITEM 13. EXHIBITS
a. Exhibits
Exhibit Number
Name of Exhibit
31.1
Certification of Chief Executive Officer, pursuant to Rule 13a-14(a) of the Exchange Act, as enacted by Section 302 of the Sarbanes-Oxley Act of 2002.(1)
31.2
Certification of Chief Financial Officer, pursuant to Rule 13a-14(a) of the Exchange Act, as enacted by Section 302 of the Sarbanes-Oxley Act of 2002.(1)
32.1
Certification of Chief Executive Officer and Chief Financial Officer, pursuant to 18 United States Code Section 1350, as enacted by Section 906 of the Sarbanes-Oxley Act of 2002. (1)
______________________
(1)
Filed herewith
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Audit Fees
The Company paid audit and financial statement review fees totaling $5,950 for the fiscal year ended December 31, 2006 and $4,445 for the year ended December 31, 2005 to Mantyla McReynolds, our current independent accountants.
Audit-Related Fees
None
Tax Fees
The company paid tax return preparation fees totaling $400 for the fiscal year ended December 31, 2006 and $350 for the fiscal year ended December 31, 2005.
All Other Fees
None
Audit committee policies & procedures
The company does not currently have a standing audit committee. The companys Board of Directors approved the above services.
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SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) GAMEPLAN, INC.
By /s/ Robert G. Berry
Robert G. Berry, Chief Executive Officer
Date
April 2, 2007
In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Signature
Title
Date
/s/ Robert G. Berry
President, Chief Executive Officer,
April 2, 2007
Robert G. Berry
Secretary, Director and Chief Financial Officer
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