NEVADA
|
68-0576847
|
(State
or other jurisdiction of incorporation
or organization)
|
(I.R.S.
Employer Identification
No.)
|
5700
W. Plano Parkway, Suite 2600, Plano, Texas
|
75093
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Large
accelerated filer o
|
Accelerated
filer o
|
Non-accelerated
filer o
|
Smaller
reporting company x
|
CONTENTS
|
||||
PART
I — FINANCIAL INFORMATION (Unaudited)
|
PAGE
|
|||
Item
1
|
—
|
Financial
Statements
|
||
2
|
||||
3
|
||||
4
|
||||
5
|
||||
Item
2
|
—
|
21
|
||
Item
3
|
—
|
24
|
||
Item
4
|
—
|
24
|
||
PART
II — OTHER INFORMATION
|
||||
Item
1
|
—
|
25
|
||
Item
1A
|
—
|
25
|
||
Item
2
|
—
|
25
|
||
Item
3
|
—
|
25
|
||
Item
4
|
—
|
25
|
||
Item
5
|
—
|
25
|
||
Item
6
|
—
|
25
|
||
EX-31.1
Section 302 Certification
|
||||
EX-31.2
Section 302 Certification
|
||||
EX-32.1
Section 906 Certification
|
||||
EX-32.2
Section 906 Certification
|
PART
I — FINANCIAL INFORMATION
|
Item
1 — Financial Statements
|
ESPRE
SOLUTIONS INC. AND SUBSIDIARY
|
Consolidated
Balance Sheets
|
March 31,
2008
|
September 30,
2007
|
|||||||
(Unaudited)
|
||||||||
(As
Restated)
|
||||||||
ASSETS
|
||||||||
Current
assets:
|
||||||||
Cash
|
$ | 1,374,728 | $ | 3,850,666 | ||||
Accounts
receivable, net
|
247,348 | 251,050 | ||||||
Prepaid
expenses and advances
|
93,064 | 34,564 | ||||||
Total
current assets
|
1,715,140 | 4,136,280 | ||||||
Equipment,
net
|
341,992 | 296,758 | ||||||
Intangible
assets, net
|
79,038 | 73,191 | ||||||
Loans
to related parties
|
69,432 | 69,432 | ||||||
Other
assets
|
124,124 | 97,292 | ||||||
Total
assets
|
$ | 2,329,726 | $ | 4,672,953 | ||||
LIABILITIES
AND STOCKHOLDERS’ (DEFICIT) EQUITY
|
||||||||
Current
liabilities:
|
||||||||
Notes
payable to related parties
|
$ | 25,000 | $ | 1,667,944 | ||||
Accounts
payable and accrued expenses
|
1,227,687 | 1,449,399 | ||||||
Total
current liabilities
|
1,252,687 | 3,117,343 | ||||||
Deferred
revenue — related party
|
- | 1,000,000 | ||||||
Minority
interest
|
1,332,505 | 348,093 | ||||||
Stockholders’
(deficit) equity
|
||||||||
Common
shares — $0.001 par value; authorized 500,000,000 shares; and 340,690,884
and 318,522,499 shares issued and outstanding ,
respectively
|
340,690 | 318,522 | ||||||
Additional
paid-in capital
|
76,630,778 | 71,110,086 | ||||||
Stock
subscription receivable
|
(28,500 | ) | (190,000 | ) | ||||
Retained
(deficit)
|
(77,198,434 | ) | (71,031,091 | ) | ||||
Total
stockholders’ (deficit) equity
|
(255,466 | ) | 207,517 | |||||
Total
liabilities and stockholders’ (deficit )equity
|
$ | 2,329,726 | $ | 4,672,953 |
The
accompanying notes are an integral part of these consolidated financial
statements
|
Consolidated
Statements of Operations
|
(Unaudited)
|
Three
Months Ended
March 31,
|
Six
Months Ended
March 31,
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
Revenues:
|
(As
Restated)
|
(As
Restated)
|
(As
Restated)
|
(As
Restated)
|
||||||||||||
Software
licensing fees
|
$ | - | $ | 600,000 | $ | 1,000,000 | $ | 1,240,000 | ||||||||
Custom
engineering fees
|
453,650 | 244,500 | 510,992 | 477,750 | ||||||||||||
Other
|
13,992 | 116,534 | 27,764 | 124,160 | ||||||||||||
Total
revenues
|
467,642 | 961,034 | 1,538,756 | 1,841,910 | ||||||||||||
Expenses:
|
||||||||||||||||
General,
administrative and selling expenses
|
3,215,226 | 1,290,372 | 5,281,914 | 2,383,800 | ||||||||||||
General,
administrative and selling expenses stock based
compensation
|
358,389 | 1,726,334 | 1,441,798 | 2,810,408 | ||||||||||||
Research
and development
|
974,795 | 366,900 | 1,626,063 | 451,500 | ||||||||||||
Amortization
and depreciation
|
32,086 | 23,399 | 70,173 | 46,746 | ||||||||||||
Total
operating expenses
|
4,580,496 | 3,407,005 | 8,419,948 | 5,692,454 | ||||||||||||
Loss
from operations
|
(4,112,854 | ) | (2,445,971 | ) | (6,881,192 | ) | (3,850,544 | ) | ||||||||
Interest
income
|
15,641 | - | 36,031 | - | ||||||||||||
Interest
expense
|
(675 | ) | (1,836 | ) | (675 | ) | (9,684 | ) | ||||||||
Net
loss before minority interest
|
(4,097,888 | ) | (2,447,807 | ) | (6,845,836 | ) | (3,860,228 | ) | ||||||||
Minority
interest
|
518,763 | - | 825,587 | - | ||||||||||||
Net
(loss)
|
$ | (3,579,125 | ) | $ | (2,447,807 | ) | $ | (6,020,249 | ) | $ | (3,860,228 | ) | ||||
Basic
and diluted net loss per share
|
$ | (0.01 | ) | $ | (0.01 | ) | $ | (0.02 | ) | $ | (0.02 | ) | ||||
Weighted
average shares outstanding, basic and diluted
|
330,385,415 | 208,334,315 | 323,934,532 | 208,334,315 |
The
accompanying notes are an integral part of these consolidated financial
statements
|
Consolidated
Statements of Cash Flows
|
Six
Months Ended March 31,
|
(Unaudited)
|
2008
|
2007
|
|||||||
Cash
flows from operating activities:
|
(As
Restated)
|
(As
Restated)
|
||||||
Net
(loss) for period
|
$ | (6,020,249 | ) | $ | (3,860,228 | ) | ||
Adjustments
to reconcile net loss to cash used in operating
activities:
|
||||||||
Stock
and options issued for services
|
838,233 | 200,000 | ||||||
Stock
based compensation
|
1,441,798 | 2,810,408 | ||||||
Amortization
and depreciation
|
70,173 | 46,746 | ||||||
Minority
interest
|
(825,587 | ) | - | |||||
Changes
in assets and liabilities:
|
||||||||
Deferred
revenue
|
(1,000,000 | ) | 150,000 | |||||
Accounts
receivable
|
4,702 | (445,486 | ) | |||||
Prepaid
expenses
|
(58,500 | ) | 27,811 | |||||
Other
assets
|
(26,833 | ) | (7,600 | ) | ||||
Accounts
payable and accrued expenses
|
(209,353 | ) | 254,809 | |||||
Total
cash used in operating activities
|
(5,785,616 | ) | (823,540 | ) | ||||
Net
cash used in investing activities:
|
||||||||
Purchase
of equipment
|
(86,545 | ) | (19,348 | ) | ||||
Purchase
of intangible assets
|
(34,709 | ) | (127,580 | ) | ||||
Loan
to affiliate
|
- | (250,000 | ) | |||||
Net
cash used in investing activities
|
(121,254 | ) | (396,928 | ) | ||||
Cash
flows provided by financing activities:
|
||||||||
Payments
on notes payable to related parties
|
(100,000 | ) | 102,957 | |||||
Proceeds
from sale of stock
|
1,781,932 | 1,140,000 | ||||||
Minority
capital raised
|
1,749,000 | - | ||||||
Net
cash provided by financing activities
|
3,430,932 | 1,242,957 | ||||||
Net
(decrease) increase in cash
|
(2,475,938 | ) | 22,489 | |||||
Cash,
beginning of period
|
3,850,666 | 291,426 | ||||||
Cash,
end of period
|
$ | 1,374,728 | $ | 313,915 | ||||
Supplemental
disclosures of cash flow information:
|
||||||||
Cash
paid for interest
|
$ | - | $ | - | ||||
Non-cash
transactions:
|
||||||||
Issuance
of common stock to retire debt
|
$ | 1,542,943 | $ | 619,000 |
The
accompanying notes are an integral part of these consolidated financial
statements
|
As
of March 31, 2008
|
||||||||||||
As
previously
reported
|
Reclassifications
and
adjustment
|
As
restated
|
||||||||||
ASSETS
|
||||||||||||
Current
assets:
|
||||||||||||
Cash
|
$ | 1,374,728 | $ | - | $ | 1,374,728 | ||||||
Accounts
receivable
|
247,348 | - | 247,348 | |||||||||
Prepaid
expenses and advances
|
93,064 | - | 93,064 | |||||||||
Total
current assets
|
1,715,140 | - | 1,715,140 | |||||||||
Equipment,
net
|
341,992 | - | 341,992 | |||||||||
Intangible
assets, net
|
79,038 | - | 79,038 | |||||||||
Loans
to related parties
|
69,432 | - | 69,432 | |||||||||
Other
assets
|
124,124 | - | 124,124 | |||||||||
Total
assets
|
$ | 2,329,726 | $ | - | $ | 2,329,726 | ||||||
LIABILITIES
AND STOCKHOLDERS (DEFICIT)
|
||||||||||||
Current
liabilities:
|
||||||||||||
Notes
payable to related parties
|
$ | 25,000 | $ | - | $ | 25,000 | ||||||
Accounts
payable and accrued expenses
|
1,229,812 | (2,125 | ) | 1,227,687 | ||||||||
Total
current liabilities
|
1,254,812 | (2,125 | ) | 1,252,687 | ||||||||
Minority
interest
|
1,186,414 | 146,091 | 1,332,505 | |||||||||
Stockholders'
(deficit)
|
||||||||||||
Common
stock
|
340,690 | - | 340,690 | |||||||||
Additional
paid in capital
|
78,782,089 | (2,151,311 | ) | 76,630,778 | ||||||||
Stock
subscription receivable
|
(28,500 | ) | - | (28,500 | ) | |||||||
Retained
(deficit)
|
(79,205,779 | ) | 2,007,345 | (77,198,434 | ) | |||||||
Total
stockholders’ (deficit)
|
(111,500 | ) | (143,966 | ) | (255,466 | ) | ||||||
Total
liabilities and stockholders' (deficit)
|
$ | 2,329,726 | $ | - | $ | 2,329,726 |
CONSOLIDATED
STATEMENT OF OPERATIONS
|
||||||||||||||||||||||||
Three
months ended March 31, 2008
|
Six
months ended March 31, 2008
|
|||||||||||||||||||||||
Previously
reported
|
Reclassifications
and
adjustments
|
As
restated
|
As
previously
reported
|
Reclassifications
and
adjustments
|
As
restated
|
|||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||
Software
licensing fees
|
$ | - | $ | - | $ | - | $ | 1,000,000 | $ | - | $ | 1,000,000 | ||||||||||||
Custom
engineering fees
|
418,284 | 35,366 | 453,650 | 475,626 | 35,366 | 510,992 | ||||||||||||||||||
Other
|
13,380 | 612 | 13,992 | 63,130 | (35,366 | ) | 27,764 | |||||||||||||||||
Total
revenues
|
431,664 | 35,978 | 467,642 | 1,538,756 | - | 1,538,756 | ||||||||||||||||||
Expenses:
|
||||||||||||||||||||||||
General,
administrative and selling
|
2,441,707 | 773,519 | 3,215,226 | 5,211,890 | 70,023 | 5,281,913 | ||||||||||||||||||
General,
administrative and selling stock based compensation
|
1,801,577 | (1,443,188 | ) | 358,389 | 3,798,318 | (2,356,520 | ) | 1,441,798 | ||||||||||||||||
Research
and development
|
1,003,810 | (29,015 | ) | 974,795 | 1,590,697 | 35,366 | 1,626,063 | |||||||||||||||||
Amortization
and depreciation
|
25,886 | 6,200 | 32,086 | 57,673 | 12,500 | 70,173 | ||||||||||||||||||
Total
operating expenses
|
5,272,980 | (692,484 | ) | 4,580,496 | 10,658,578 | (2,238,631 | ) | 8,419,947 | ||||||||||||||||
Loss
from operations
|
(4,841,316 | ) | 728,462 | (4,112,854 | ) | (9,119,822 | ) | 2,238,631 | (6,881,191 | ) | ||||||||||||||
Interest
income
|
36,030 | (20,389 | ) | 15,641 | 36,030 | - | 36,030 | |||||||||||||||||
Interest
expense
|
(1,575 | ) | 900 | (675 | ) | (1,575 | ) | 900 | (675 | ) | ||||||||||||||
Net
loss before minority interest
|
(4,806,861 | ) | 708,973 | (4,097,888 | ) | (9,085,367 | ) | 2,239,531 | (6,845,836 | ) | ||||||||||||||
Minority
interest
|
529,319 | (10,556 | ) | 518,763 | 910,678 | (85,091 | ) | 825,587 | ||||||||||||||||
Net
(loss)
|
$ | (4,277,542 | ) | $ | 698,417 | $ | (3,579,125 | ) | $ | (8,174,689 | ) | $ | 2,154,440 | $ | (6,020,249 | ) | ||||||||
Basic
and diluted net loss per share
|
$ | (0.01 | ) | $ | - | $ | (0.01 | ) | $ | (0.03 | ) | $ | 0.01 | $ | (0.02 | ) | ||||||||
Weighted
average shares outstanding, basic and diluted
|
330,385,415 | - | 330,385,415 | 323,934,532 | - | 323,934,532 |
CONSOLIDATED
STATEMENT OF CASH FLOWS
|
||||||||||||
Six
months ended March 31, 2008
|
||||||||||||
As
previously
reported
|
Reclassifications
and
adjustments
|
As
restated
|
||||||||||
Cash
flows from operating activities:
|
||||||||||||
Net
(loss) for period
|
$ | (8,174,689 | ) | $ | 2,154,440 | $ | (6,020,249 | ) | ||||
Adjustments
to reconcile net loss to cash used in operating
activities:
|
||||||||||||
Stock
and options issued for services
|
732,477 | 105,756 | 838,233 | |||||||||
Stock
based compensation
|
3,798,318 | (2,356,520 | ) | 1,441,798 | ||||||||
Amortization
and depreciation
|
57,673 | 12,500 | 70,173 | |||||||||
Minority
interest
|
(910,678 | ) | 85,091 | (825,587 | ) | |||||||
Changes
in assets and liabilities:
|
||||||||||||
Deferred
revenue
|
(1,000,000 | ) | - | (1,000,000 | ) | |||||||
Accounts
receivable
|
3,702 | 1,000 | 4,702 | |||||||||
Prepaid
expenses
|
(58,501 | ) | - | (58,501 | ) | |||||||
Other
assets
|
(26,832 | ) | - | (26,832 | ) | |||||||
Accounts
payable and accrued expenses
|
(219,587 | ) | 10,234 | (209,353 | ) | |||||||
Total
cash used in operating activities
|
(5,798,117 | ) | 12,501 | (5,785,616 | ) | |||||||
Net
cash used in investing activities:
|
||||||||||||
Purchase
of equipment
|
(87,032 | ) | 487 | (86,545 | ) | |||||||
Purchase
of intangible assets
|
(21,721 | ) | (12,988 | ) | (34,709 | ) | ||||||
Net
cash used in investing activities
|
(108,753 | ) | (12,501 | ) | (121,254 | ) | ||||||
Cash
flows provided by financing activities:
|
||||||||||||
Payments
on notes payable to related parties
|
(100,000 | ) | - | (100,000 | ) | |||||||
Proceeds
from sale of stock
|
1,781,932 | - | 1,781,932 | |||||||||
Minority
capital raised
|
1,749,000 | - | 1,749,000 | |||||||||
Net
cash provided by financing activities
|
3,430,932 | - | 3,430,932 | |||||||||
Net
decrease in cash
|
(2,475,938 | ) | - | (2,475,938 | ) | |||||||
Cash,
beginning of period
|
3,850,666 | - | 3,850,666 | |||||||||
Cash,
end of period
|
$ | 1,374,728 | $ | - | $ | 1,374,728 | ||||||
Supplemental
disclosures of cash flow information:
|
||||||||||||
Cash
paid for interest
|
$ | - | $ | - | $ | - | ||||||
Non-cash
transactions:
|
||||||||||||
Issuance
of common stock to retire debt
|
$ | 1,542,943 | $ | - | $ | 1,542,943 |
CONSOLIDATED
STATEMENT OF OPERATIONS
|
||||||||||||||||||||||||
Three
months ended March 31, 2007
|
Six
months ended March 31, 2007
|
|||||||||||||||||||||||
Previously
reported
|
Reclassifications and adjustments
|
As restated
|
As previously
reported
|
Reclassifications and adjustments
|
As restated
|
|||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||
Software
licensing fees
|
$ | - | $ | 600,000 | $ | 600,000 | $ | 1,990,000 | $ | (750,000 | ) | $ | 1,240,000 | |||||||||||
Custom
engineering fees
|
244,500 | - | 244,500 | 477,750 | - | 477,750 | ||||||||||||||||||
Other
|
116,534 | - | 116,534 | 124,160 | - | 124,160 | ||||||||||||||||||
Total
revenues
|
361,034 | 600,000 | 961,034 | 2,591,910 | - | 1,841,910 | ||||||||||||||||||
Expenses:
|
||||||||||||||||||||||||
General,
administrative and selling
|
1,218,772 | 71,600 | 1,290,372 | 2,383,800 | - | 2,383,800 | ||||||||||||||||||
General,
administrative and selling: stock based compensation
|
1,726,334 | - | 1,726,334 | 2,810,408 | - | 2,810,408 | ||||||||||||||||||
Research
and development
|
366,900 | - | 366,900 | 451,500 | - | 451,500 | ||||||||||||||||||
Amortization
and depreciation
|
23,399 | - | 23,399 | 46,746 | - | 46,746 | ||||||||||||||||||
Total
operating expenses
|
3,335,405 | 71,600 | 3,407,005 | 5,692,454 | - | 5,692,454 | ||||||||||||||||||
Loss
from operations
|
(2,974,371 | ) | 528,400 | (2,445,971 | ) | (3,100,544 | ) | (750,000 | ) | (3,850,544 | ) | |||||||||||||
Interest
income
|
- | - | - | - | - | - | ||||||||||||||||||
Interest
expense
|
(1,836 | ) | - | (1,836 | ) | (9,684 | ) | - | (9,684 | ) | ||||||||||||||
Net
loss before minority interest
|
(2,976,207 | ) | 528,400 | (2,447,807 | ) | (3,110,228 | ) | (750,000 | ) | (3,860,228 | ) | |||||||||||||
Minority
interest
|
- | - | - | - | - | - | ||||||||||||||||||
Net
(loss)
|
$ | (2,976,207 | ) | $ | 528,400 | $ | (2,447,807 | ) | $ | (3,110,228 | ) | $ | (750,000 | ) | $ | (3,860,228 | ) | |||||||
Basic
and diluted net loss per share
|
$ | (0.01 | ) | $ | - | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.02 | ) | |||||||
Weighted
average shares outstanding, basic and diluted
|
220,393,640 | - | 220,393,640 | 220,393,640 | - | 220,393,640 |
CONSOLIDATED
STATEMENT OF CASH FLOWS
|
||||||||||||
Six
months ended March 31, 2007
|
||||||||||||
As
previously
reported
|
Reclassifications
and
adjustments
|
As
restated
|
||||||||||
Cash
flows from operating activities:
|
||||||||||||
Net
(loss) for period
|
$ | (3,110,228 | ) | $ | (750,000 | ) | $ | (3,860,228 | ) | |||
Adjustments
to reconcile net loss to cash used in operating
activities:
|
||||||||||||
Stock
and options issued for services
|
200,000 | - | 200,000 | |||||||||
Stock
based compensation
|
2,810,408 | - | 2,810,408 | |||||||||
Amortization
and depreciation
|
46,746 | - | 46,746 | |||||||||
Changes
in assets and liabilities:
|
||||||||||||
Deferred
revenue
|
150,000 | - | 150,000 | |||||||||
Accounts
receivable
|
(1,195,486 | ) | 750,000 | (445,486 | ) | |||||||
Prepaid
expenses
|
27,811 | - | 27,811 | |||||||||
Other
assets
|
(7,600 | ) | - | (7,600 | ) | |||||||
Accounts
payable and accrued expenses
|
254,809 | - | 254,809 | |||||||||
Total
cash used in operating activities
|
(823,540 | ) | - | (823,540 | ) | |||||||
Net
cash used in investing activities:
|
||||||||||||
Purchase
of equipment
|
(19,348 | ) | - | (19,348 | ) | |||||||
Purchase
of intangible assets
|
(127,580 | ) | - | (127,580 | ) | |||||||
Loan
to affiliate
|
(250,000 | ) | - | (250,000 | ) | |||||||
Net
cash used in investing activities
|
(396,928 | ) | - | (396,928 | ) | |||||||
Cash
flows provided by financing activities:
|
||||||||||||
Payments
on notes payable to related parties
|
102,957 | - | 102,957 | |||||||||
Proceeds
from sale of stock
|
1,140,000 | - | 1,140,000 | |||||||||
Net
cash provided by financing activities
|
1,242,957 | - | 1,242,957 | |||||||||
Net
decrease in cash
|
22,489 | - | 22,489 | |||||||||
Cash,
beginning of period
|
291,426 | - | 291,426 | |||||||||
Cash,
end of period
|
$ | 313,915 | $ | - | $ | 313,915 | ||||||
Supplemental
disclosures of cash flow information:
|
||||||||||||
Cash
paid for interest
|
$ | - | $ | - | $ | - | ||||||
Non-cash
transactions:
|
||||||||||||
Issuance
of common stock to retire debt
|
$ | 619,000 | $ | - | $ | 619,000 |
|
·
|
Persuasive
evidence of a contractual arrangement
exists;
|
|
·
|
Delivery
of the service has occurred in accordance with the Company’s contractual
obligations and title has passed to the
customer;
|
|
·
|
The
fee or revenue recognized is fixed or determinable;
and,
|
|
·
|
The
right to payment is unconditional and collectability is
probable.
|
|
·
|
Obtain
additional debt and equity
financing
|
|
·
|
Market
its principal product, VUELIVE (previously EspreLive), to customers
wishing to build applications using video and provide custom engineering
services to those customers as
requested.
|
|
·
|
Engage
in partnerships with firms in key vertical markets. These
partners will be market experts and have well defined application
strategies that require VUELIVE to develop
them.
|
|
·
|
Launch
Blideo as an application service
provider.
|
|
·
|
Establish
independent sales agreements with representatives to sell its products and
services. The Company will actively pursue the engagement of
additional independent sales representatives who can distribute the
Company’s existing video products and services, both domestically and
internationally.
|
March 31,
2008
|
September 30,
2007
|
|||||||
Contingent
repurchase agreement to Video Software Partners, secured by certain
software products, payable on February 1, 2008, interest imputed at
10%
|
$
|
-
|
$
|
1,642,944
|
||||
Note
payable to a related individual, at 10%, due November 25, 2004, extended
year to year, unsecured
|
25,000
|
25,000
|
||||||
$
|
25,000
|
$
|
1,667,944
|
March 31,
2008
|
September 30,
2007
|
|||||||
Accounts
payable - trade
|
$
|
845,349
|
$
|
543,487
|
||||
Accrued
expenses
|
38,845
|
242,151
|
||||||
Due
to investment banker
|
-
|
139,825
|
||||||
Accrued
vacation pay
|
76,640
|
76,640
|
||||||
Accrued
payroll and payroll taxes
|
266,853
|
297,296
|
||||||
Customer
advances
|
-
|
150,000
|
||||||
$
|
1,227,687
|
$
|
1,449,399
|
Outstanding
Stock Options
|
Exercisable
Stock Options
|
|||||||||
Options
|
Weighted
Average
Exercise
Price
|
Options
|
Weighted
Average
Exercise
Price
|
|||||||
Outstanding
at beginning of period
|
79,904,634
|
$
|
.1174
|
36,506,010
|
$
|
.1174
|
||||
Granted
|
4,500,000
|
$
|
.0883
|
4,261,172
|
$
|
.0876
|
.
|
|||
Outstanding
at end of period
|
84,404,634
|
$
|
.1159
|
40,767,182
|
$
|
.1159
|
Outstanding
Stock Options
|
Exercisable
Stock Options
|
||||||||||||||||||||||
Exercise Price Range
|
Shares
|
Life
|
Weighted
Average exercise Price
|
Shares
|
Life
|
Weighted
Average exercise Price
|
|||||||||||||||||
$
|
0.010
- $0.085
|
51,979,634
|
8.33
|
$
|
0.08
|
19,619,273
|
8.33
|
$
|
0.08
|
||||||||||||||
$
|
0.100
- $0.200
|
26,945,000
|
7.70
|
$
|
0.10
|
19,730,749
|
7.70
|
$
|
0.10
|
||||||||||||||
$
|
0.210
- $1.333
|
5,480,000
|
6.90
|
$
|
0.54
|
1,417,160
|
6.90
|
$
|
0.61
|
||||||||||||||
84,404,634
|
40,767,182
|
Outstanding
Warrants
|
Exercisable
Warrants
|
|||||||||||||||
Shares
|
Weighted
Average
Exercise
Price
|
Shares
|
Weighted
Average
Exercise
Price
|
|||||||||||||
Outstanding
at December 31, 2007
|
44,019,716
|
$
|
0.10
|
44,019,716
|
$
|
0.10
|
||||||||||
Granted
during period
|
-
|
-
|
-
|
-
|
||||||||||||
Exercised
during the period
|
(892,858
|
)
|
$
|
0.10
|
(892,858
|
)
|
$
|
0.10
|
||||||||
Outstanding
at March 31, 2008
|
43,126,858
|
$
|
0.10
|
43,126,858
|
$
|
0.10
|
March 31,
2008
|
September 30,
2007
|
|||||||
Net
operating loss carryforward
|
$ | 21,388,000 | $ | 19,433,000 | ||||
In-process
research and development
|
1,129,000 | 1,528,000 | ||||||
Transition
adjustment
|
217,000 | 217,000 | ||||||
$ | 22,734,000 | $ | 21,178,000 | |||||
Less
valuation allowance
|
(22,734,000 | ) | (21,178,000 | ) | ||||
Net
deferred tax assets
|
$ | - | $ | - |
|
·
|
Obtain
additional debt and equity
financing
|
|
·
|
Market
our principal product, VUELIVE (previously EspreLive), to customers
wishing to build applications using video and provide custom engineering
services to those customers as
requested.
|
|
·
|
Engage
in partnerships with firms in key vertical markets. These
partners will be market experts and have well-defined application
strategies that require VUELIVE to build them. Potential
customers have been identified and we are in active negotiations with
them. No assurance can be given, however, that we will be
successful in entering into satisfactory commercial arrangements with
these or other customers.
|
|
·
|
Establish
independent sales agreements with representatives to sell its products and
services. We will actively pursue the engagement of additional
independent sales representatives who can distribute our existing video
products and services, both domestically and
internationally. Potential partners have been identified and we
are in active negotiations with them. No assurance can be
given, however, that we will be successful in entering into satisfactory
commercial arrangements with these or other
partners.
|
Date
|
Date
|
||
/s/
William Hopke
|
November
12, 2008
|
/s/
BG Moore
|
November
12, 2008
|
William Hopke
|
BG Moore
|
||
President
|
Chief
Financial Officer
|