As filed with the Securities and Exchange Commission on December __, 2020.

 

Registration No. 333-236563

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

POST EFFECTIVE AMENDMENT NO. 5

FORM S-1

 

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

Investview, Inc.

(Exact name of registrant as specified in its charter)

 

Nevada   7389   87-0369205

(State or other jurisdiction of

incorporation or organization)

 

(Primary Standard Industrial

Classification Code Number)

 

(I.R.S. Employer

Identification Number)

 

234 Industrial Way West, Ste. A202, Eatontown, New Jersey 07224

Telephone 732-889-4300

(Address, including zip code and telephone number, including area code, of registrant’s principal executive offices)

 

Joseph Cammarata, Chief Executive Officer

Investview, Inc.

234 Industrial Way West, Ste. A202, Eatontown, New Jersey 07724

Telephone: 732-889-4300

(Name, address, including zip code and telephone number, including area code, of agent for service)

 

Copy to:

The Lonergan Law Firm, LLC

Lawrence R. Lonergan, Esq.

96 Park Street

Montclair, NJ 07042

Telephone: 973-641-4012

 

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. [  ]

 

If this Form is filed to register additional securities for an Offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same Offering. [  ]

 

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same Offering. [  ]

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer [  ] Accelerated filer [  ]
Non-accelerated filer [  ] Smaller reporting company [X]
  Emerging growth company [  ]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. [  ]

 

CALCULATION OF REGISTRATION FEE

 

Title of Each Class of Securities to be Registered   Amount to be Registered     Proposed Maximum Offering Price per Share     Proposed Maximum Aggregate Offering Price     Amount of Registration Fee(1)  
Units consisting of shares of Series B Preferred Stock, par value $0.001 per share, and Warrants to purchase shares of Common Stock, par value $0.001 per share     2,000,000     $ 25.00     $ 50,000,000          
                                 
Shares of Series B Preferred Stock, included as part of the Units     2,000,000                          
                                 
Common Stock Purchase Warrants to purchase common stock, included as part of the Units (2)     10,000,000                          
                                 
Shares of Common Stock, par value $0.001 per share, issuable upon exercise of the Warrants (3)(4)     10,000,000     $ 0.10     $ 1,000,000          
                                 
Total                   $ 51,000,000     $ 6,619.80  

 

(1) Calculated pursuant to Rule 457(a) based on an estimate of the proposed maximum aggregate Offering price.
(2) In accordance with Rule 457(i) promulgated under the Securities Act, because the shares of our common stock underlying the Warrants are registered hereby, no separate registration fee is required with respect to the Warrants registered hereby.
(3) We are issuing five (5) Common Stock Purchase Warrants (the “Warrants”) each exercisable to purchase one (1) share of our common stock, par value $0.001 (“Common Stock”) as part of the units offered hereunder (the “Units”). Each Unit consists of: (i) one (1) share of 13% Series B Preferred Cumulative Redeemable Perpetual Preferred Stock (“Series B Preferred”); and (ii) five (5) Warrants. The Warrants are exercisable for a period of five (5) years from the date of issuance to purchase one (1) additional share of Common Stock at a price of $0.10 per share.
(4) No additional registration fee is payable pursuant to Rule 457(g) promulgated under the Securities Act. The registration fee was paid upon the filing of the registrant’s initial S-1 on February 21, 2020, Registration No. 333-236563 which was declared effective by the SEC on March 6, 2020 (the “Registration Statement”).

 

The registrant is filing this post-effective amendment no. 5 to amend the registration statement (declared effective by the SEC on March 6, 2020) on such date or dates as may be necessary to delay its effective date of this post-effective amendment no. 5 until the registrant shall file a further amendment, if any, which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended (the “Securities Act”), or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

 

Explanatory Note: The purpose of this Post-Effective Amendment No. 5 to the Registration Statement filed with the SEC on February 21, 2020, Registration No. 333-236563, and declared effective by the SEC on March 6, 2020, is to: (i) file as Exhibit 10.55.2 hereto an amendment to the Certificate of Designations, Preferences and Rights of 13% Series B Cumulative Redeemable Perpetual Preferred Stock (“Certificate of Designation”), specifically amending Section 4 of the Series B Certificate of Designation to provide for, among other things, the payment of dividends on a quarterly basis rather than a monthly basis and, at the request of Series B Holders, payment of the quarterly dividend will be made by check, wire transfer or such other form of payment, including the type of currency including but not limited to digital assets agreed to by the Corporation and each Series B Holder; (ii) include the registrant’s financial statements through the period ended September 30, 2020; (iii) report the change in a majority of the Board of Directors effective April 27, 2020 in connection with the entry into a Securities Purchase Agreement with DBR Capital, LLC, dated April 27, 2020 and the related transaction documents (Reference is made to the registrant’s Form 8-K and 8-K/A, both filed on April 30, 2020); (iv) update the Executive Compensation table to include compensation paid in fiscal 2020; and (v) other revisions to the Registration Statement as a result of the foregoing.

 

The information included in this filing amends this Registration Statement, the previously filed Post-Effective Amendments and the prospectus contained therein and herein. No additional securities are being registered under this Post-Effective Amendment No. 5. All applicable registration fees were paid at the time of the original filing of the Registration Statement.

 

 

 

 
 

 

PROSPECTUS

Subject to completion, dated December __, 2020

 

The information in this prospectus related to this post-effective amendment no. 5 to the Registration Statement is not complete and may be changed. These securities included in this Registration Statement, of which this prospectus, are subject to an effective Registration Statement. This prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

 

INVESTVIEW, INC.

2,000,000 Units

Each Unit Consisting of

One Share of 13% Series B Cumulative Redeemable Perpetual Preferred Stock and

Five Warrants Each Exercisable to Purchase One Share of Common Stock

 

Pursuant to this Post-Effective Amendment No. 5 to the Registration Statement, No. 333-236563, of which this prospectus is a part, we are offering (the “Offering”) a total of 2,000,000 units (each a “Unit” and collectively, the “Units”), each Unit consisting of: (i) one share of our newly authorized 13% Series B Cumulative Redeemable Perpetual Preferred Stock (the “Series B Preferred”); and (ii) five (5) warrants (the “Warrants”) each exercisable to purchase one (1) share of common stock, par value $0.001 per share (“Common Stock” or “Warrant Shares”), at an exercise price of $0.10 (the “Exercise Price”) per Warrant Share. Each Warrant offered hereby as part of the Units is immediately exercisable on the date of issuance and will expire on the date that is five (5) years from the date(s) of issuance (the “Warrant Expiration Date(s)”). Since March 6, 2020, the Effective Date of the Registration Statement, the Registrant has sold approximately 52,000 Units.

 

The shares of Series B Preferred have a stated value of $25 per share (“Stated Value”), which shares of Series B Preferred Stock are offered hereby as part of the Units. Commencing on the date of the issuance of shares of Series B Preferred Stock (as applicable, the “Issue Date”), dividends shall accrue on the Series B Preferred Stock daily and shall be cumulative from, and including, the applicable Issue Date, and shall be payable to the Preferred B Holders on a quarterly basis in arrears, on or about the 15th day after the end of each calendar quarter (each, a “Dividend Payment Date”) as such Series B Holders appear on the stock records of the Corporation at the close of business on the last day of the preceding fiscal quarter, whether or not a Business Day. Reference is made to Exhibit 10.55.2 to this Registration Statement for the full terms of the Series B Preferred Stock, contained in the Amended Series B Certificate of Designation. The Amended Series B Certificate of Designation further provides, among other things, that: (i) at the Corporation’s sole discretion, dividends in amounts less than $50.00 may be held and not paid until the Dividend Payment Date on which the accumulated dividend payable to a Series B Holder exceeds $50.00; and (ii) the quarterly Dividends may be paid to Series B Holders by check, wire transfer or such other form of payment, including the type of currency (including but not limited to digital assets designed to work as a medium of exchange) agreed to by the Corporation and each Series B Holder.

 

Dividends will be payable out of amounts legally available therefor at a rate equal to 13% per annum per $25, the Stated Value per share, or $3.25 per share of Series B Preferred per year. We will reserve the amount equal to the first three years of dividend payments, or $9.75 per share of Series B Preferred, from the proceeds from this Offering (the “Dividend Reserve”) in an escrow account (the “Escrow Account”) maintained by International Financial Enterprise Bank (“IFEB Bank”), with offices in Dallas, TX, also referred to hereinafter as the “Escrow Agent.”

 

Commencing on three years from the dates of issuance, we may redeem, at our option, the shares of Series B Preferred, in whole or in part, at a cash redemption price equal to: (i) of $25 per share, plus all accrued and unpaid dividends to, but not including, the redemption date. The Series B Preferred has no stated maturity, will not be subject to any sinking fund or other mandatory redemption, and will not be convertible into or exchangeable for any of our other securities.

 

Holders of the Series B Preferred will have no voting rights, except as set forth below in section “Voting Rights” under subheading “Description of Offered Securities” and Section 8 of the Amended Series B Certificate of Designation, filed as Exhibit 10.55.2 and attached to this POS AM as filed with the SEC on or around December __, 2020.

 

Prior to this Offering, there has been no public market for the Units, the Series B Preferred or the Warrants. We anticipate that upon FINRA approving the symbols we request for the Units, shares of Series B Preferred, and the Warrants, that these securities will initially be subject to quotation and trading on the OTC Market including, possibly, the OTCQB or OTCQX, of which there can be no assurance, under the symbols “INVUU,” “INVUB” and “INVUW,” respectively. Our Common Stock is currently quoted on the OTCQB market under the symbol “INVU.”

 

We may use broker-dealers, referred to as placement agents to use their best efforts to solicit offers to purchase the Units in this Offering. If any placement agents sell Units, they will be deemed “underwriters” as that term is defined by Section 2(a)(11) of the Securities Exchange Act of 1933 (the “Securities Act”). We will pay any placement agent’s cash commissions equal to 9% of the gross proceeds from any Units they sell and issued Placement Agent Warrants exercisable for a period of 5 years to purchase a number of Units sold by participating Placement Agreements equal to 9% of the Units the respective Placement Agents sell at an exercise price of $25.00 per Placement Agent Warrant. Referenced is made to the Form of Placement Agent Agreement, as Amended, attached as Exhibit 10.56.1 to the registration statement, declared effective on March 6, 2020.

 

Investing in our securities involves a high degree of risk. See “Risk Factors” beginning on page 8 of this prospectus. You should carefully consider these risk factors, as well as the information contained in this prospectus, before purchasing any of the securities offered by this prospectus.

 

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

 

    Per Unit     Total  
Public Offering price   $ 25.00     $ 50,000,000  
Placement agent fees (1)(2)   $ 2.25     $ 4,500,000  
Proceeds, before expenses, to the Company   $ 22.75     $ 45,500,000  

 

(1) See “Plan of Distribution” for a description of cash commissions payable to the placement agent equal to 9% of the number of Units sold by each respective Placement Agent. In addition, the Company will issue a number of Placement Agent Warrants equal to 9% of the number of Units sold by each Placement Agent. We estimate our other expenses to be $100,000.

(2) Assumes all Units will be sold by Placement Agents.

 

[______________]

 

The date of this prospectus is December [  ], 2020

 

 
 

 

TABLE OF CONTENTS

 

  Page
   
Cautionary Note Regarding Forward-Looking Statements 3
Prospectus Summary 4
The Offering 5
Risk Factors 8
Use of Proceeds 22
Dividend Policy 23
Capitalization 24
Financial Information F-1
Business 25
Management’s Discussion and Analysis of Financial Condition and Results of Operations 28
Management 37
Executive and Director Compensation 39
Principal Stockholders 42
Related Person Transactions 43
Description of our Securities 45
Description of Offered Securities 47
Certain U.S. Federal Income Tax Considerations 54
Plan of Distribution 60
Legal Matters 61
Experts 62
Where You Can Find Additional Information 63
Disclosure of Commission Position on Indemnification for Securities Act Liabilities 64

 

You should rely only on the information contained in this prospectus. We have authorized anyone to provide any information or to make any representations other than those contained in this prospectus we have prepared. We take no responsibility for and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the securities offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. You should also read this prospectus together with the additional information described under “Additional Information.”

 

Unless the context otherwise requires, we use the terms “we,” “us,” “the Company” and “our” to refer to Investview, Inc. and its consolidated subsidiaries.

 

  2  
     

 

CAUTIONARY Note Regarding Forward-Looking Statements

 

This prospectus contains statements about the future, sometimes referred to as “forward-looking” statements. Forward-looking statements are typically identified by the use of the words “believe,” “may,” “could,” “should,” “expect,” “anticipate,” “estimate,” “project,” “propose,” “plan,” “intend,” and similar words and expressions. Statements that describe our future strategic goals, plans, objectives, and predictions are also forward-looking statements. This prospectus contains forward-looking statements relating to future products or product development; future selling, general and administrative costs and research and development spending; future performance of our network marketing efforts; our expectations regarding ongoing litigation; international growth; and future financial performance, results of operations, capital expenditures, and sufficiency of capital resources to fund our operating requirements.

 

This forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future, and accordingly, such results may differ from those expressed in any forward-looking statements made herein. These risks and uncertainties include those relating to:

 

  noncompliance by our independent distributors with applicable legal requirements or our policies and procedures;
  potential adverse effects on our business and stock price due to ineffective internal controls over financial reporting;
  inability to manage financial reporting and internal control systems and processes;
  inability to properly motivate and manage our independent distributors;
  inability to manage existing markets, open new international markets, or expand our operations;
  inability of new products to gain distributor or market acceptance;
  inability to execute our product launch process due to increased pressure on our supply chain, information systems, and management;
  disruptions in our information technology systems;
  inability to protect against cybersecurity risks and to maintain the integrity of data;
  international trade or foreign exchange restrictions, increased tariffs, foreign currency exchange fluctuations;
  deterioration of global economic conditions;
  inability to raise additional capital if needed;
  inability to retain independent distributors or to attract new independent distributors on an ongoing basis;
  government regulations on direct selling activities in our various markets prohibiting or severely restricting our business;
  unfavorable publicity on our business or products;
  a finding that our direct selling program is not in compliance with current or newly adopted laws or regulations in various markets;
  expensive and time-consuming legal proceedings;
  potential for investigatory and enforcement action by the Federal Trade Commission;
  failure to comply with anti-corruption laws;
  inability to build and integrate our management team;
  loss of, or inability to attract, key personnel;
  unexpected tax or other assessments relating to the activity of our independent distributors;
  economic, political, foreign exchange, and other risks associated with international operations; and
  volatility of the market price of our common stock.

 

These forward-looking statements are only predictions, are uncertain and involve substantial known and unknown risks, uncertainties and other factors which may cause our (or our industry’s) actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements. The “Risk Factors” section of this prospectus sets forth detailed risks, uncertainties and cautionary statements regarding our business and these forward-looking statements. Moreover, we operate in a very competitive and rapidly changing regulatory environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all of the risks and uncertainties that could have an impact on the forward-looking statements contained in this prospectus.

 

We cannot guarantee future results, levels of activity or performance. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this prospectus. These cautionary statements should be considered with any written or oral forward-looking statements that we may issue in the future. Except as required by applicable law, including the securities laws of the U.S., we do not intend to update any of the forward-looking statements to conform these statements to reflect actual results, later events or circumstances or to reflect the occurrence of unanticipated events. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or other investments or strategic transactions we may engage in.

 

  3  
     

 

Prospectus Summary

 

This prospectus summary, which is a part of the Registration Statement declared effective by the SEC on March 6, 2020, contains an overview of the information from this prospectus, but may not contain all of the information that is important to you. This prospectus includes specific terms of the offering of our common stock, information about our business, and financial data. We encourage you to read this prospectus, including the “Risk Factors” section beginning on page 8, in its entirety before making an investing decision. You should read this prospectus together with additional information described below under the heading “Where You Can Find Additional Information.” As used in this prospectus, the terms “we,” “us,” and “our” refer to Investview, Inc., a corporation organized under the laws of the state of Nevada, including our subsidiaries, and our predecessors, unless the context indicates a different meaning.

 

Our Business

 

We are dedicated to leveraging financial technology worldwide.

 

We provide financial technology services and products for the benefit of individuals worldwide. By marrying emerging technologies to education and research, we can deliver information in real-time to anyone in the world.

 

Our companies service four sectors: personal finance, big data, passive investments and alternative assets. The recent growth of each of these sectors is not slowing down and we anticipate growth of the next three years is astounding.

 

We have established multiple subsidiaries, each with a dedicated focus to these high growth sectors.

 

Our Address

 

Our principal executive offices are located at 234 Industrial Way West, Ste. A202, Eatontown, New Jersey 07224, and our telephone number is 732-889-4300.

 

Before you invest in our Units, you should carefully consider all the information in this Prospectus, including matters set forth under the heading “Risk Factors.”

 

Our Filing Status as a “Smaller Reporting Company”

 

We are a “smaller reporting company,” meaning that we are not an investment company, an asset-backed issuer, or a majority-owned subsidiary of a parent company that is not a smaller reporting company and have a public float of less than $75 million and annual revenues of less than $50 million during the most recently completed fiscal year. As a “smaller reporting company,” the disclosure we will be required to provide in our SEC filings are less than it would be if we were not considered a “smaller reporting company.” Specifically, “smaller reporting companies” are able to provide simplified executive compensation disclosures in their filings; are exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act of 2002 requiring that independent registered public accounting firms provide an attestation report on the effectiveness of internal control over financial reporting; are not required to conduct say-on-pay and frequency votes until annual meetings occurring on or after January 21, 2013; and have certain other decreased disclosure obligations in their SEC filings, including, among other things, being permitted to provide two years of audited financial statements in annual reports rather than three years. Decreased disclosures in our SEC filings due to our status as a “smaller reporting company” may make it harder for investors to analyze the Company’s results of operations and financial prospects.

 

  4  
     

 

The Offering

 

The following summary contains basic terms about this Unit Offering including the Series B Preferred and the Warrants and is not intended to be complete. It may not contain all of the information that is important to you. You should read the more detailed information contained in this prospectus, including but not limited to, the risk factors beginning on page 8. For a more complete description of the terms of the Units, see “Description of the Securities Offered.” Reference is also made to the “Amended Series B Certificate of Designations, Preferences and Rights of 13% Series B Cumulative Redeemable Perpetual Preferred Stock,” filed as Exhibit 10.55.2 hereto and attached to this POS AM No. 5 as filed with the SEC on or about December __, 2020 (the “Amended Series B Certificate of Designation.”

 

Issuer   Investview, Inc.
     
Securities Offered   2,000,000 Units, each Unit consisting of: (i) one share of 13% Series B Preferred, having a Stated Value of $25; and (ii) five Warrants each exercisable to purchase one share of our Common Stock (the “Warrant Shares”) at an exercise price of $0.10 (the “Exercise Price”). The shares of Series B Preferred and the Warrants comprising the Units are immediately separable upon issuance and will be issued separately upon the closing of this Offering.
     
Shares of Series B Preferred Offered with Units   2,000,000
     
Warrants Offered with Units   Warrants to purchase up to 10,000,000 shares of Common Stock (the “Warrant Shares”), which will be exercisable during the period commencing on the date of their issuance and ending five years from such date (the “Warrant Expiration Date”) at an exercise price of $0.10 per Warrant Share (the “Exercise Price”). This Prospectus also relates to the Offering of the shares of Common Stock issuable upon exercise of the Warrants, referred to herein as the Warrant Shares. There is no established public trading market for the Warrants, and we cannot assure you an active trading market will develop or be sustained, if at all. In addition, the exercise price of the Warrants is subject to adjustment in the event during the five-year exercise period from the original issuance of the Warrants, if we sell any shares of our Common Stock or securities exchangeable or exercisable or convertible into our Common Stock, subject to certain exceptions, at a price per share less than the exercise price of the Warrants then in effect or without consideration. Reference is made to Exhibit 10.57, Form of Common Stock Purchase Warrant.
     
Series B Preferred to be Outstanding after this Offering   2,000,000 shares
     
Offering Price   $25 per Unit

 

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Dividends   Commencing on the date of the issuance of shares of Series B Preferred Stock (as applicable, the “Issue Date”), dividends shall accrue on the Series B Preferred Stock daily and shall be cumulative from, and including, the applicable Issue Date, and shall be payable to the Preferred B Holders on a quarterly basis in arrears, on or about the 15th day after the end of each calendar quarter (each, a “Dividend Payment Date”) as such Series B Holders appear on the stock records of the Corporation at the close of business on the last day of the preceding fiscal quarter, whether or not a Business Day. Reference is made to Exhibit 10.55.2 to this Registration Statement for the full terms of the Series B Preferred Stock, contained in the Amended Series B Certificate of Designation. The Amended Series B Certificate of Designation further provides, among other things, that: (i) at the Corporation’s sole discretion, dividends in amounts less than $50.00 may be held and not paid until the Dividend Payment Date on which the accumulated dividend payable to a Series B Holder exceeds $50.00; and (ii) the quarterly Dividends may be paid to Series B Holders by check, wire transfer or such other form of payment, including the type of currency (including but not limited to digital assets designed to work as a medium of exchange) agreed to by the Corporation and each Series B Holder.
     
Dividend Escrow   We will allocate and pay from the proceeds from this Offering an amount equal to the first three years of dividend payments, or $9.75 per share of Series B Preferred, which monies will be deposited in an escrow account at IFEB Bank (the “Escrow Agent”). The dividends on the Series B Preferred paid by the Company from the proceeds of the Offering into the Escrow Account and will be held by the Escrow Agent and will be transmitted by the Escrow Agent into an account maintained by the Company for payment to the Series B Holders on a quarterly basis in arrears. See “Description of Offered Securities - Dividends.”
     
No Maturity, Sinking Fund or Mandatory Redemption   The Series B Preferred has no stated maturity and will not be subject to any sinking fund or mandatory redemption. Shares of the Series B Preferred will remain outstanding indefinitely unless we decide to redeem or otherwise repurchase them as provided under Optional Redemption and Special Optional Redemption below. We are not required to set aside funds to redeem the Series B Preferred.
     
Optional Redemption  

The Series B Preferred is not redeemable by us prior to the three-year anniversary of each issuance of Series B Preferred. We may, at our option, redeem the Series B Preferred, in whole or in part, at any time or from time to time, for cash at a redemption price equal to the Stated Value of $25 per share of Series B Preferred, plus any accumulated and unpaid dividends to, but not including, the redemption date. See “Description of the Series B Preferred - Redemption - Optional Redemption” for further details. If we redeem any Series B Preferred, we will only do so by treating all investors equally. In order to do that, we will deposit all redemption proceeds in an escrow account, since we expect the three-year periods to vary. The only exception to escrowing funds will be if the redemption date is more than three years after issuance of all Series B Preferred in which case, we will simply pay all investors at the same time.

 

Special Optional Redemption  

Upon the occurrence of a Change of Control, we may, at our option, redeem the Series B Preferred, in whole or in part, within 120 days after notice of such Change of Control, for cash at a redemption price equal to the Stated Value of $25 per share of Series B Preferred, plus any accumulated and unpaid dividends to, but not including, the redemption date.

 

A “Change of Control” is deemed to occur when any person, including any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Securities Exchange Act of 1934 (the “Exchange Act”) of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of purchases, mergers or other acquisition transactions shall have acquired our stock entitling that person to exercise more than 50% of the total voting power of all our stock entitled to vote generally in the election of our directors (except that such person will be deemed to have beneficial ownership of all securities that such person has the right to acquire, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition).

 

  6  
     

 

Ranking   The Series B Preferred will rank, with respect to rights to the payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up, senior to all classes or series of our Common Stock or our issued and outstanding Series A Preferred Stock and to all other equity securities issued by us other than equity securities on a parity with all equity securities issued by us with terms specifically providing that those equity securities rank on a parity with the Series B Preferred with respect to rights to the payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up; junior to all equity securities issued by us with terms specifically providing that those equity securities rank senior to the Series B Preferred with respect to rights to the payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up, including any other series of Preferred Stock; and effectively junior to all of our existing and future indebtedness (including indebtedness convertible into our Common Stock or Preferred Stock) and to the indebtedness and other liabilities of (as well as any preferred equity interests held by others in) our existing subsidiaries and any future subsidiaries. See “Description of the Series B Preferred–Ranking” for further information.
     
Limited Voting Rights   Holders of Series B Preferred will have no voting rights except for the limited instance where the Series B Preferred may vote. See the section entitled “Description of the Series B Preferred—Voting Rights,” and Section 8 of the Amended Series B Certificate of Designation, filed as Exhibit 10.55.2 and attached to this POS AM No. 5, as filed with the SEC on or about December __, 2020.
     
Use of Proceeds   After escrowing proceeds equal to $9.75 per share of Series B Preferred with the Escrow Agent for the payment of the initial three years of dividends, we plan to use the net proceeds from this Offering to repay our outstanding debt and the balance for working capital, general corporate purposes and growth initiatives, including potential future acquisitions, although the Company has no present plans, arrangements or agreements for any such acquisitions other than as contemplated in the registrant’s Form 8-K filed with the SEC on April 30, 2020 and the exhibits thereto. See the disclosure under “Use of Proceeds” below.
     
Risk Factors   Please read the disclosure under the section entitled “Risk Factors” below for a discussion of some of the factors you should carefully consider before deciding to invest in our Units consisting of Series B Preferred and Warrants.
     
Trading Market   Our Common Stock is quoted on the OTCQB under the INVU symbol. We expect the Units, the Series B Preferred, and the Warrants will be quoted under the symbols “INVUU,” “INVUB” and “INVUW,” respectively, pending assignment by FINRA of trading symbols. We intend to initially apply to the OTCQB Market (“OTCQB”) to make these securities become subject to quotation although we may determine to apply for quotation on the OTCQX although there can be no assurance that we will qualify for quotation of these securities on the OTCQX. See “Description of Offered Securities - Trading Market.”
     
Transfer Agent   Vstock Transfer LLC is the transfer agent for the Company’s common stock and will act as the registrar and transfer agent with respect of the Units, Series B Preferred Stock, Warrants and. shares of common stock underlying any conversion of the Warrants.
     
Certain U.S. Federal Income Tax Considerations  

For a discussion of the federal income tax consequences of purchasing, owning and disposing of the Series B Preferred, please see the section entitled “Certain U.S. Federal Income Tax Considerations.” You should consult your tax advisor with respect to the U.S. federal income tax consequences of owning the Series B Preferred in light of your own particular situation and with respect to any tax consequences arising under the laws of any state, local, foreign or other taxing jurisdiction.

 

Book Entry and Form   The Units, the Series B Preferred and the Warrants will be represented by one or more global certificates in definitive, fully registered form deposited with a custodian for, and registered in the name of, a nominee of The Depository Trust Company (“DTC”).

 

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Risk Factors

 

Investing in our securities involves a high degree of risk. You should carefully consider and evaluate all of the information contained in this prospectus before you decide to purchase the Units. The risks and uncertainties described in this prospectus are not the only ones we may face. Additional risks and uncertainties that we do not presently know about or that we currently believe are not material may also adversely affect our business, business prospects, results of operations or financial condition. Any of the risks and uncertainties set forth herein, could materially and adversely affect our business, results of operations and financial condition. This could cause the market price of the Units, the Series B Preferred and the Warrants to decline, perhaps significantly, and you may lose part or all of your investment.

 

Risks Related to our Financial Condition

 

Because this is a best effort Offering, investors who invest initially will be subject to more risk than later investors.

 

We are seeking to raise up to $50,000,000 from the sale of the Units. Since March 6, 2020, the date the Registration Statement was declared effective by the SEC (the “Effective Date”), we have escrowed and will continue to escrow approximately 39% of the gross proceeds in order to provide investors a 13% return through dividend payments for three years from the date of issuance to each investor. There is no minimum to the Offering and, as a result, we will be able to use the Offering Proceeds, as received, for our operations, excluding 39% of the Offering Proceeds that will be deposited with the Escrow Agent for the payment of quarterly dividends. The Offering Proceeds will be first used to pay our indebtedness and we intend to use the remaining proceeds for working capital, general corporate purposes and growth initiatives, including potential future acquisitions, although the Company has no present plans, arrangements or agreements for any such acquisitions. See “Description of Offered Securities – Series B Preferred” and the Amended Series B Certificate of Designation, filed as Exhibit 10.55.2 and attached to this POS AM No. 5, as filed with the SEC on or about December 15, 2020. Because this is a best effort Offering, the earlier investors invest in this Offering, the greater degree of risk they will incur. For example, if the Company raises an immaterial amount, investors will be subject to more risk than if all or substantially all of the $50,000,000 is raised, excluding any proceeds from the exercise of Warrants. This is because there is no minimum amount of proceeds we must raise. If we do not raise a substantial amount of proceeds, we may not have sufficient working capital to be able to carry out our business since we are continuing to lose money. In that event, we will be required to seek other financing which, if available, may be very dilutive and expensive. In that event, your investment will be adversely affected. In order to qualify our shares of Series B Preferred Stock for quotation on the OTCQB, of which there can be no assurance, we will need to generate net proceeds of $1.7 million from the sale of 68,000 Units. We will continue the Offering of Units until all of the units are sold or we terminate the Offering. While there can be no assurance that we will be successful in selling 68,000 Units and securing quotation of our Series B Preferred Stock on the OTCQB, to date we have sold approximately 52,000 Units with proceeds of approximately $1.3 million.

 

Our Independent Registered Public Accounting Firm has expressed substantial doubt as to our ability to continue as a going concern.

 

The audited financial statements have been prepared assuming that we will continue as a going concern and do not include any adjustments that might result if we cease to continue as a going concern. We believe that to continue as a going concern we will need approximately $1,000,000 per year simply to cover the administrative, legal and accounting fees. We plan to fund these expenses primarily through cash flow from operations, if and when we generate positive cash flow, of which there can be no assurance, the sale of restricted shares of our Common Stock, and the issuance of convertible notes, as well as funds raised from this Offering, if it is successful, of which there can be no assurance

 

Based on our financial statements for the years ended March 31, 2020 and 2019, our independent registered public accounting firm has expressed substantial doubt as to our ability to continue as a going concern. Reference is also made to our quarterly report on Form 10-Q for the period-ended September 30, 2020 and specifically Note 4 - Going Concern and Liquidity, in which we disclose “Our financial statements are prepared using generally accepted accounting principles applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. We have incurred significant recurring losses, which have resulted in an accumulated deficit of $52,536,063 as of September 30, 2020, along with a net loss of $1,187,760 for the three months ended September 30, 2020. Additionally, as of September 30, 2020, we had cash of $583,955 and a working capital deficit of $18,383,173. These factors raise substantial doubt about our ability to continue as a going concern.

 

Investing in our securities involves a great deal of risk. Careful consideration should be made of the following factors as well as other information included in this Prospectus before deciding to purchase the Units subject of this Offering or of our Common Stock in the open market or otherwise. Our business, financial condition or results of operations could be affected materially and adversely by any or all the risks set forth under “Risk Factors” and elsewhere in this Prospectus.

 

Our operations and financial condition may be adversely impacted by the COVID-19 pandemic.

 

In December 2019, a strain of novel coronavirus, or COVID-19, was first reported in Wuhan, China, resulting in thousands of confirmed cases of the disease in China. By January, the Chinese government implemented a quarantine protocol for Wuhan and implemented other restrictions for other major Chinese cities, including mandatory business closures, social distancing measures, and various travel restrictions, all of which have subsequently been adopted in countries throughout the world. On March 11, 2020, as COVID-19 spread outside of China, the World Health Organization designated the outbreak as a global pandemic. This pandemic could affect our business, employees, operating results, ability to obtain additional funding, product development programs, research and development programs, suppliers and third-party manufacturers.

 

We anticipate that COVID-19 and a prolonged public health crisis may negatively impact our financial condition and operating results; however, given the evolving health, economic, social, and governmental environments, the breadth and duration of the impact remains uncertain. Given the dynamic nature of these circumstances, the duration of any business disruption or potential impact to our business resulting from the COVID-19 coronavirus is difficult to predict, but it may increase our costs or expenses.

 

We may need to raise additional capital to fund continuing operations and an inability to raise the necessary capital or to do so on acceptable terms could threaten the success of our business.

 

To date, our operations have been funded entirely from the proceeds from equity and debt financings or loans from our management. We currently anticipate that our available capital resources will be insufficient to meet our expected working capital and capital expenditure requirements for the near future. We anticipate that we will require an additional $1.5 million during the next twelve months to fulfil our business plan. However, such resources may not be sufficient to fund the long-term growth of our business. If we determine that it is necessary to raise additional funds, we may choose to do so through strategic collaborations, licensing arrangements through our “White Labelling” strategy, public or private equity or debt financing, a bank line of credit, or other arrangements.

 

We cannot be sure that any additional funding will be available on terms favorable to us or at all. Any additional equity financing may be dilutive to our shareholders, new equity securities may have rights, preferences or privileges senior to those of existing holders of our shares of Common stock. Debt or equity financing may subject us to restrictive covenants and significant interest costs. If we obtain funding through a strategic collaboration or licensing arrangement, we may be required to relinquish our rights to our product or marketing territories. If we are unable to obtain the financing necessary to support our operations, we may be required to defer, reduce or eliminate certain planned expenditures or significantly curtail our operations.

 

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We have a history of net losses; we may never achieve or sustain profitability or positive cash flow from operations.

 

We have incurred net losses in each fiscal year since our inception, including net losses of $21,285,191 for the year ended March 31, 2020 and $5,011,036 for the year ended March 31, 2019, and a net loss of $6,101,547 for the six months ended September 30, 2020. As of September 30, 2020, we had an accumulated deficit of $52,536,063. We expect to continue to incur substantial expenditures to develop and market our services and could continue to incur losses and negative operating cash flow for the foreseeable future. We may never achieve profitability or positive cash flow in the future, and even if we do, we may not be able to continue being profitable.

 

We have a limited operating history; it is difficult to evaluate our business and future prospects and increases the risks associated with investment in our securities.

 

We have only limited prior business operations. Because of our limited operating history, investors may not have adequate information on which they can base an evaluation of our business and prospects. Investors should be aware of the difficulties, delays, and expenses normally encountered by an enterprise in its early stage, many of which are beyond our control, including unanticipated research and development expenses, employment costs, and administrative expenses. We cannot assure our investors that our proposed business plans as described herein will materialize or prove successful, or that we will be able to finalize development of our products or operate profitably. We may not be successful in addressing these and other challenges we may face in the future, and our business and future prospects may be materially and adversely affected if we do not manage these and other risks successfully. Given our limited operating history, we may be unable to effectively implement our business plan which could materially harm our business or cause us to scale down or cease our operations.

 

Risks Related to our Business

 

We may not be able to manage our growth effectively, which could slow or prevent our ability to achieve profitability.

 

The ability to manage and operate our business as we execute our development and growth strategy will require effective planning. Significant rapid growth could strain our internal resources and delay or prevent our efforts to achieve profitability. We expect that our efforts to grow will place a significant strain on our personnel, management systems, infrastructure, and other resources. Our ability to manage future growth effectively will also require us to successfully attract, train, motivate, retain, and manage new employees and continue to update and improve our operational, financial, and management controls and procedures. If we do not manage our growth effectively, slower growth is likely to occur, thereby slowing or negating our ability to achieve and sustain profitability.

 

We may not be able to fully protect our proprietary rights and we may infringe the proprietary rights of others, which could result in costly litigation.

 

Our future success depends on our ability to protect and preserve the proprietary rights related to our products. We cannot assure that we will be able to prevent third parties from using our intellectual property rights and technology without our authorization. We also rely on trade secrets, common law trademark rights, and trademark registrations, as well as confidentiality and work for hire, development, assignment, and license agreements with employees, consultants, third-party developers, licensees, and customers. Our protective measures for these intangible assets afford only limited protection and may be flawed or inadequate.

 

Policing unauthorized use of our technology is difficult and some foreign laws do not provide the same level of protection as U.S. laws. Litigation may be necessary in the future to enforce our intellectual property rights, to protect our trade secrets or patents that we may obtain, or to determine the validity and scope of the proprietary rights of others. Such litigation could result in substantial costs and diversion of resources and have a material adverse effect on our future operating results.

 

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In recent years, there has been significant litigation in the United States involving patents and other intellectual property rights. In particular, there has been an increase in the filing of suits alleging infringement of intellectual property rights, which pressures defendants into entering settlement arrangements quickly to dispose of such suits, regardless of their merits. Other companies or individuals may allege that we infringe on their intellectual property rights. Litigation, particularly in the area of intellectual property rights, is costly and the outcome is inherently uncertain. In the event of an adverse result, we could be liable for substantial damages and we may be forced to discontinue our use of the intellectual property in question or obtain a license to use those rights or develop non-infringing alternatives.

 

 Our business could be negatively affected by any adverse economic developments in the securities markets or the economy in general.

 

We depend on the interest of individuals in obtaining financial information and securities trading strategies to assist them in making their own investment decisions. Significant downturns in the securities markets or in general economic and political conditions may cause individuals to be reluctant to make their own investment decisions and, thus, decrease the demand for our products. Significant upturns in the securities markets or in general economic and political conditions may cause individuals to be less proactive in seeking ways to improve the returns on their trading or investment decisions and, thus, decrease the demand for our products.

 

We may encounter risks relating to security or other system disruptions and failures that could reduce the attractiveness of our sites and that could harm our business.

 

Although we have implemented various security mechanisms, our business is vulnerable to computer viruses, physical or electronic break-ins, and similar disruptions, which could lead to interruptions, delays, or loss of data. For instance, because a portion of our revenue is based on individuals using credit cards to purchase subscriptions over the Internet and a portion from advertisers that seek to encourage people to use the Internet to purchase goods or services, our business could be adversely affected by these break-ins or disruptions.

 

Additionally, our operations depend on our ability to protect systems against damage from fire, earthquakes, power loss, telecommunications failure, and other events beyond our control. Moreover, our website may experience slower response times or other problems for a variety of reasons, including hardware and communication line capacity restraints, software failures, or significant increases in traffic when there have been important business or financial news stories. These strains on our systems could cause customer dissatisfaction and could discourage visitors from becoming paying subscribers. Our websites could experience disruptions or interruptions in service due to the failure or delay in the transmission or receipt of information from us. These types of occurrences could cause users to perceive our website and technology solutions as not functioning properly and cause them to use other methods or services of our competitors. Any disruption resulting from these actions may harm our business and may be very expensive to remedy, may not be fully covered by our insurance, could damage our reputation, and discourage new and existing users from using our products and services. Any disruptions could increase costs and make profitability even more difficult to achieve.

 

We will need to introduce new products and services and enhance existing products and services to remain competitive.

 

Our future success depends in part on our ability to develop and enhance our products and services. In addition, the adoption of new Internet, networking, or telecommunications technologies or other technological changes could require us to incur substantial expenditures to enhance or adapt our services or infrastructure. There are significant technical and financial costs and risks in the development of new or enhanced products and services, including the risk that we might be unable to effectively use new technologies, adapt our services to emerging industry standards, or develop, introduce, and market enhanced or new products and services. An inability to develop new products and services, or enhance existing offerings, could have a material adverse effect on our profitability.

 

We rely on external service providers to perform certain key functions.

 

We rely on a number of external service providers for certain key technology, processing, service, and support functions. External content providers provide us with financial information, market news, charts, option and stock quotes, research reports, and other fundamental data that we offer to clients. These service providers face technological and operational risks of their own. Any significant failures by them, including improper use or disclosure of our confidential client, employee, or company information, could cause us to incur losses and could harm our reputation.

 

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We cannot assure that any external service providers will be able to continue to provide these services in an efficient, cost-effective manner or that they will be able to adequately expand their services to meet our needs. An interruption in or the cessation of service by any external service provider as a result of systems failures, capacity constraints, financial constraints or problems, unanticipated trading market closures, or for any other reason, and our inability to make alternative arrangements in a smooth and timely manner, if at all, could have a material adverse effect on our business, results of operations, and financial condition.

 

We could face liability and other costs relating to storage and use of personal information about its users.

 

Users provide us with personal information, including credit card information, which we do not share without the user’s consent. Despite this policy of obtaining consent, however, if third persons were able to penetrate our network security or otherwise misappropriate our users’ personal or credit card information, we could be subject to liability, including claims for unauthorized purchases with credit card information, impersonation or other similar fraud claims, and misuses of personal information, such as for unauthorized marketing purposes. New privacy legislation may further increase this type of liability. Furthermore, we could incur additional expenses if additional regulations regarding the use of personal information were introduced or if federal or state agencies were to investigate our privacy practices.

 

 Our business could be negatively affected if we are required to defend allegations of unfair competition and unfair false or deceptive acts or practices in or affecting commerce.

 

Advertising and marketing of our products in the United States are also subject to regulation by the Federal Trade Commission (“FTC”) under the Federal Trade Commission Act, or FTC Act. Among other things, the FTC Act prohibits unfair methods of competition and unfair false or deceptive acts or practices in or affecting commerce. The FTC Act also makes it illegal to disseminate or cause to be disseminated any false advertisement. The FTC routinely reviews websites to identify questionable advertising claims and practices. Competitors sometimes inform the FTC when they believe other competitors are violating the FTC Act and consumers also notify the FTC of what they believe may be wrongful advertising. The FTC may initiate a non-public investigation that focuses on our advertising claims, which usually involves non-public, pre-lawsuit, extensive formal discovery. Such an investigation may be lengthy and expensive to defend and result in a publicly disclosed consent decree or settlement agreement. If no settlement can be reached, the FTC may start an administrative proceeding or a federal court lawsuit against us or our principal officers. The FTC often seeks to recover from the defendants, whether in a consent decree or a proceeding, any or all of the following: (i) consumer redress in the form of monetary relief or disgorgement of profits; (ii) significant reporting requirements for several years; and (iii) injunctive relief. In addition, most, if not all, states have statutes prohibiting deceptive and unfair acts and practices. The requirements under these state statutes are similar to those of the FTC Act.

 

We accept and hold cryptocurrencies, which may subject us to exchange risk and additional tax and regulatory requirements.

 

We have recently begun accepting cryptocurrencies, bitcoin and etherium as a form of payment. Cryptocurrencies are not considered legal tender or backed by any government and have experienced significant price volatility, technological glitches, and various law enforcement and regulatory interventions. If we fail to comply with regulations or prohibitions applicable to us, we could face regulatory or other enforcement actions and potential fines and other consequences. We also hold cryptocurrencies directly, subjecting us to exchange rate risk as well as the risk that regulatory or other developments and the recent price volatility may adversely affect the value of the cryptocurrencies we hold. The uncertainties regarding legal and regulatory requirements relating to cryptocurrencies or transactions using cryptocurrencies, as well as potential accounting and tax issues or other requirements relating to cryptocurrencies, could have a material adverse effect on our business.

 

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Our business could be negatively affected if we are required to defend allegations that our direct selling activities are fraudulent or deceptive schemes, are against public interest, or are the sale of unregistered securities.

 

Direct selling activities are regulated by the FTC, as well as various federal, state, and local governmental agencies in the United States and foreign countries. These laws and regulations are generally intended to prevent fraudulent or deceptive schemes, often referred to as “pyramid” schemes, which compensate participants primarily for recruiting additional participants without significant emphasis on product sales. Regulators may take the position that some or all of our products are deemed to be securities, the sale of which has not been registered. The laws and regulations governing direct selling are modified from time to time, and like other direct selling companies, we may be subject from time to time to government investigations related to our direct selling activities. This may require us to make changes to our business model and our compensation plan.

 

Our independent distributors could fail to comply with applicable legal requirements or our distributor policies and procedures, which could result in claims against us that could harm our business.

 

Our independent distributors are independent contractors and, accordingly, we are not in a position to directly provide the same oversight, direction, and motivation as we could if they were our employees. As a result, we cannot assure that our independent distributors will comply with applicable laws or regulations or our distributor policies and procedures.

 

Extensive federal, state, local, and international laws regulate our business, products, and direct selling activities. Because we have expanded into foreign countries, our policies and procedures for our independent distributors differ slightly in some countries due to the different legal requirements of each country in which we do business.

 

Our proprietary systems may be compromised by hackers.

 

Our current products and other products and services that we may develop in the future will be based on proprietary software and customer-specific data that we protect by routine measures such as password protection, confidentiality and nondisclosure agreements with employees, and similar measures. Any unauthorized access to our software or data could materially disrupt our business and result in financial loss and damages to our business reputation.

 

 Our future success is largely dependent on our current management.

 

Our business was built by the vision, dedication, and expertise of our executive officers, who are responsible for our day-to-day operations and creative development. Our success is dependent upon the continued efforts of these people. If it became necessary to replace them, it is unlikely new management could be found that would have the same level of knowledge and dedication to our success. The loss of the services of these professionals, especially in the development of future proprietary software, patents, or applications, would adversely affect our business.

 

Risks Related to this Offering and Ownership of the Units, Series B Preferred and the Warrants.

 

The Series B Preferred ranks junior to all of our indebtedness and other liabilities

 

In the event of our bankruptcy, liquidation, dissolution or winding-up of our affairs, our assets will be available to pay obligations on the Series B Preferred only after all of our indebtedness and other liabilities have been paid. The rights of holders of the Series B Preferred to participate in the distribution of our assets will rank junior to the prior claims of our current and future creditors, existing preferred stock and Common Stock, and any future series or class of preferred stock we may issue that ranks senior to the Series B Preferred. Also, the Series B Preferred effectively ranks junior to all our existing and future indebtedness and to the indebtedness and other liabilities of our existing subsidiaries and any future subsidiaries. Our existing subsidiaries are, and future subsidiaries would be, separate legal entities and have no legal obligation to pay any amounts to us in respect of dividends due on the Series B Preferred. If we are forced to liquidate our assets to pay our creditors, we may not have sufficient assets to pay amounts due on any or all of the Series B Preferred then outstanding. We may in the future incur debt and other obligations that will rank senior to the Series B Preferred. At September 30, 2020, we had total liabilities of $29,322,235. Nevertheless, the three years of dividends on the Series B Preferred, which total $9.75 per share of Series B Preferred, that will be paid by the Company from the proceeds of the Offering into the Escrow Account, will not be the property of the Company but rather will be for the sole benefit of the Series B holders, payable to them on a quarterly basis. As a result, these dividends will not, in the ordinary course, be accessible to third-party creditors of the Company.

 

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Additionally, any convertible or exchangeable securities that we issue in the future may have rights, preferences and privileges more favorable than those of the Series B Preferred and may result in dilution to owners of the Series B Preferred. We and, indirectly, our stockholders, will bear the cost of issuing and servicing such securities. Because our decision to issue debt or equity securities in any future Offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future Offerings. The holders of the Series B Preferred will bear the risk of our future Offerings, which may reduce the market price of the Series B Preferred and will dilute the value of their holdings in us.

 

We may not be able to declare and pay dividends on the Series B Preferred if we fail to comply with the conditions imposed by the applicable Nevada law requirements.

 

Section 78.288 “Distributions to stockholders” of the Nevada Revised Statute provide that we may only declare and pay cash dividends on the Series B Preferred if (a) the corporation would not be able to pay its debts as they become due in the usual course of business; or (b) except as otherwise specifically allowed by the articles of incorporation, the corporation’s total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the corporation were to be dissolved at the time of distribution, to satisfy the preferential rights upon dissolution of stockholders whose preferential rights are superior to those receiving the distribution. There can be no assurance that we will satisfy such requirements in any given year.

 

There is no established market for the Units, the Series B Preferred or the Warrants and no assurance that a market will develop and be sustained.

 

There is no established trading market for the Units, the Series B Preferred or the Warrants and we do not know if a market will develop on the OTCQB for the Series B Preferred Stock or, if it does, how active it will be or whether it will be sustained. Further, if in the future we believe we meet the quantitative requirements for listing our Common Stock on Nasdaq, we intend to apply to have the Common Stock, the Units, the Series B Preferred and the Warrants listed. We cannot assure you that we will meet the quantitative listing requirements or that any application will be approved. The liquidity of the market for the Units, the Series B Preferred, and the Warrants depends on a number of factors, including prevailing interest rates, our financial condition and operating results, the number of holders of these securities, the market for similar securities and the interest of securities dealers in making a market in these securities. The market for the Warrants will be linked to the price and the liquidity of our Common Stock. We cannot predict with certainty the extent of investor interest in the Units, the Series B Preferred, and the Warrants, or how liquid that market will be. Without an active trading market, the liquidity of these securities will be limited.

 

 We may issue additional shares of Series B Preferred and additional series of preferred stock that rank on parity with or senior to the Series B Preferred as to dividend rights, rights upon liquidation or voting rights.

 

We are allowed to issue additional shares of Series B Preferred and additional series of preferred stock that would rank on parity with or junior to the Series B Preferred as to dividend payments and rights upon our liquidation, dissolution or winding up of our affairs pursuant to our Certificate of Incorporation, including the Certificate of Designations relating to the Series B Preferred without any vote of the holders of the Series B Preferred. Upon the affirmative vote of the holders of at least two-thirds of the outstanding shares of Series B Preferred (voting together as a class with all other series of parity preferred stock we may issue upon which like voting rights have been conferred and are exercisable), we are allowed to issue additional series of preferred stock that would rank senior to the Series B Preferred as to dividend payments and rights upon our liquidation, dissolution or the winding up pursuant to our Certificate of Incorporation and the Certificate of Designations relating to the Series B Preferred. The issuance of additional shares of Series B Preferred and additional series of preferred stock could have the effect of reducing the amounts available to the holders of Series B Preferred upon our liquidation or dissolution or the winding up of our affairs.

 

Also, although holders of Series B Preferred are entitled to limited voting rights, as described in this prospectus under “Description of the Series B Preferred - Voting Rights,” and in Section 8 of the Amended Series B Certificate of Designation, filed as Exhibit 10.55.2 to this POS AM No. 5 as filed with the SEC on or about December __, 2020, with respect to the circumstances under which the holders of Series B Preferred are entitled to vote, the Series B Preferred votes separately as a class along with all other series of our preferred stock that we may issue upon which like voting rights have been conferred and are exercisable. As a result, the voting rights of the holders of Series B Preferred may be significantly diluted, and the holders of such other series of preferred stock that we may issue may be able to control or significantly influence the outcome of any vote. Future issuances and sales of senior or parity preferred stock, or the perception that such issuances and sales could occur, may cause prevailing market prices for the Series B Preferred and our Common Stock to decline and may adversely affect our ability to raise additional capital in the financial markets at times and prices favorable to us.

 

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Holders of the Units may be unable to use the dividends-received deduction and may not be eligible for the preferential tax rates applicable to “qualified dividend income.”

 

Dividends paid to corporate U.S. holders of the Series B Preferred, which is being offered in this Offering as part of the Units, may be eligible for the dividends-received deduction, and dividends paid to non-corporate U.S. holders of the Series B Preferred may be subject to tax at the preferential tax rates applicable to “qualified dividend income,” if we have current or accumulated earnings and profits, as determined for U.S. federal income tax purposes. We do not currently have accumulated earnings and profits. Additionally, we may not have sufficient current earnings and profits during future fiscal years for the distributions on the Series B Preferred to qualify as dividends for U.S. federal income tax purposes. If the distributions fail to qualify as dividends, U.S. holders would be unable to use the dividends-received deduction and may not be eligible for the preferential tax rates applicable to “qualified dividend income.” If any distributions on the Series B Preferred with respect to any fiscal year are not eligible for the dividends-received deduction or preferential tax rates applicable to “qualified dividend income” because of insufficient current or accumulated earnings and profits, the market value of the Units and the Series B Preferred could decline.

 

If we redeem the Series B Preferred, investors will no longer be entitled to dividends.

 

On or after three years after the first sale of Series B Preferred in or about March 2023, we may, at our option, redeem the Series B Preferred, in whole or in part, at any time or from time-to-time, based upon the payment of the Stated Value of $25 per share of Series B Preferred plus accrued dividends. Also, upon the occurrence of a Change of Control (as defined below under “Description of the Series B Preferred – Redemption”), we may, at our option, upon not less than 30 and nor more than 60 days’ written notice, redeem the Series B Preferred, in whole or in part, within 120 days after the date of such written notice. We may have an incentive to redeem the Series B Preferred voluntarily if market conditions allow us to issue other preferred stock or debt securities at a rate that is lower than the dividend on the Series B Preferred. If we redeem the Series B Preferred, then from and after the redemption date, dividends will cease to accrue on the shares of Series B Preferred, that have been redeemed, such shares of Series B Preferred shall no longer be deemed outstanding and all rights as a holder of those shares will terminate, except the right to receive the redemption price plus accumulated and unpaid dividends, if any, payable upon redemption.

 

The market price of the Units, the Series B Preferred and the Warrants could be substantially affected by various factors.

 

The market price of the Units, the Series B Preferred and the Warrants could be subject to wide fluctuations in response to numerous factors. The price of the Units and the Series B Preferred that will prevail in the market after this Offering may be higher or lower than the Offering price depending on many factors, some of which are beyond our control and may not be directly related to our operating performance.

 

These factors include, but are not limited to, the following:

 

prevailing interest rates, increases in which may have an adverse effect on the market price of the Series B Preferred;
trading prices of similar securities;
our history of timely dividend payments;
the annual yield from dividends on the Series B Preferred as compared to yields on other financial instruments;
general economic and financial market conditions;
government action or regulation;
the financial condition, performance and prospects of us and our competitors;

 

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changes in financial estimates or recommendations by securities analysts with respect to us or our competitors in our industry;
our issuance of additional equity or debt securities; and
actual or anticipated variations in quarterly operating results of us and our competitors.

 

The Warrants are likely to trade in the same manner as our Common Stock.

 

As a result of these and other factors, investors who purchase the Units in this Offering may experience a decrease, which could be substantial and rapid, in the market price of the Units, the Series B Preferred and the Warrants, including decreases unrelated to our operating performance or prospects.

 

If you purchase the Units, you will have no voting rights except for extremely limited voting rights for the Series B Preferred.

 

The voting rights of a holder of Series B Preferred are limited. Our shares of Common Stock are the only classes of our securities that carry full voting rights.

 

The holders of Series B Preferred have no voting rights except with respect to voting on amendments to our Series B Preferred Certificate of Designation that materially and adversely affect the rights of the holders of Series B Preferred or authorize, increase or create additional classes or series of our capital stock that are senior to the Series B Preferred. Other than the limited circumstances described in the Prospectus and except to the extent required by law, holders of Series B Preferred do not have any voting rights. See “Description of the Series B Preferred—Voting Rights.”

 

The Series B Preferred is not convertible into our common stock, investors will not benefit if the price of our common stock increases.

 

The Series B Preferred is not convertible into our Common Stock and earns dividends at a fixed rate. Accordingly, an increase in market price of our Common Stock will not necessarily result in an increase in the market price of our Series B Preferred. The market value of the Series B Preferred may depend more on dividend and interest rates for other preferred stock, commercial paper and other investment alternatives and our actual and perceived ability to pay dividends on, and in the event of dissolution satisfy the liquidation preference with respect to, the Series B Preferred.

 

Management will have broad discretion in using the proceeds of this Offering.

 

We intend to use the net proceeds of this Offering (after putting the dividends for the initial three years into an escrow account) to pay our indebtedness and thereafter for working capital and general corporate purposes to support our growth. We have not allocated any specific portion of the net proceeds to any particular purpose, and our management will have the discretion to allocate the proceeds as it determines. We will have significant flexibility and broad discretion in applying the net proceeds of this Offering. Our management might not be able to yield a significant return, if any, on any investment of these net proceeds, and you will not have the opportunity to influence our decisions on how to use our net proceeds from this Offering.

 

Risks Relating to Our Common Stock

 

We have a history of operating losses and expect to report future losses that may cause our stock price to decline.

 

We have incurred net losses in each fiscal year since our inception, including net losses of $21,285,191 for the year ended March 31, 2020 and $5,011,036 for the year ended March 31, 2019, and a net loss of $6,101,547 for the six months ended September 30, 2020. As of September 30, 2020, we had an accumulated deficit of $52,536,063. We cannot be certain whether we will ever be profitable, or if we do, that we will be able to continue to be profitable. Also, any economic weakness or global recession may limit our ability to market our products. Any of these factors could cause our stock price to decline and result in our stockholders losing a portion or all of their investments.

 

  15  
     

 

We will need to raise additional capital. If we are unable to raise additional capital, our business may fail.

 

Because our revenues are not yet sufficient to cover expenses or fund our growth, we need to secure ongoing funding. If we are unable to obtain adequate additional financing, we may not be able to successfully market and sell our products, our business operations will most likely be discontinued, and we will cease to be a going concern. To secure additional financing, we may need to borrow money or sell more securities. Under these circumstances, we may be unable to secure additional financing on favorable terms or at all. Selling additional stock, either privately or publicly, would dilute the equity interests of our stockholders. If we borrow money, we will have to pay interest and may also have to agree to restrictions that limit our operating flexibility. If we are unable to obtain adequate financing, we may have to curtail business operations, which would have a material negative effect on operating results and most likely result in a lower stock price.

 

 Our common stock price has been and may continue to be extremely volatile.

 

Our common stock has closed as low as $0.006 per share and as high as $.036 per share during the fiscal year preceding the date of this prospectus. We believe this volatility may be caused, in part, by variations in our quarterly operating results, delays in development of our technologies, changes in market valuations of similar companies, and the volume of our stock in the market.

 

Additionally, in recent years the stock market in general, and the OTC Markets and technology stocks in particular, have experienced extreme price and volume fluctuations. In some cases, these fluctuations are unrelated or disproportionate to the operating performance of the underlying company. These market and industry factors may materially and adversely affect our stock price regardless of our operating performance. The historical trading of our common stock is not necessarily an indicator of how it will trade in the future and our trading price as of the date of this prospectus is not necessarily an indicator of what the trading price of our common stock might be in the future.

 

In the past, class action litigation has often been brought against companies following periods of volatility in the market price of those companies’ common stock. If we become involved in this type of litigation in the future it could result in substantial costs and diversion of management attention and resources, which could have a further negative effect on our stock price.

 

Shares of our common stock may never become eligible for trading on Nasdaq or a national securities exchange.

 

We cannot assure that we will ever be listed on the Nasdaq Stock Market or on another national securities exchange. Listing on one of the Nasdaq markets or one of the national securities exchanges is subject to a variety of requirements, including minimum trading price and minimum public “float” requirements. There are also continuing eligibility requirements for companies listed on national securities exchanges. If we are unable to satisfy the initial or continuing eligibility requirements of any such market, then our stock may not be listed or could be delisted. This could result in a lower trading price for our common stock and may limit the ability of our stockholders to sell their shares, which could result in a loss of some or all of their investments.

 

If we fail to file periodic reports with the U.S. Securities and Exchange Commission, our common stock will not be able to be traded on the OTCQB.

 

Although our common stock trades on the OTCQB, a regular trading market for our common stock may not be sustained in the future. OTC Markets limits quotation on the OTCQB to securities of issuers that are current in their reports filed with the Securities and Exchange Commission. If we fail to remain current in the filing of our reports with the Securities and Exchange Commission, our common stock will not be able to be traded on the OTCQB. The OTCQB is an inter-dealer market that provides significantly less liquidity than a national securities exchange or automated quotation system.

 

Because we have no plans to pay dividends on our common stock, stockholders must look solely to appreciation of our common stock to realize a gain on their investments.

 

We do not anticipate paying any dividends on our common stock in the foreseeable future. We currently intend to retain future earnings, if any, to finance the expansion of our business. Our future dividend policy is within the discretion of our board of directors and will depend upon various factors, including our business, financial condition, results of operations, capital requirements, and investment opportunities. Accordingly, stockholders must look solely to appreciation of our common stock to realize a gain on their investment. This appreciation may not occur.

 

  16  
     

 

Certain provisions of Nevada law and of our corporate charter may inhibit a potential acquisition of our Company, and this could depress our stock price.

 

Nevada corporate law includes provisions that could delay, defer, or prevent a change in control of our company or our management. These provisions could discourage information contests and make it more difficult for our stockholders to elect directors and take other corporate actions. As a result, these provisions could limit the price that investors are willing to pay in the future for shares of our common stock. For example:

 

  (i) without prior stockholder approval, our board of directors has the authority to issue one or more classes of preferred stock with rights senior to those of our common stock and to determine the rights, privileges, and inference of that preferred stock;
  (ii) there is no cumulative voting in the election of directors, which would otherwise allow less than a majority of stockholders to elect director candidates; and
  (iii) stockholders cannot call a special meeting of stockholders.

 

Our indemnification of our directors and officers may limit the rights of our stockholders.

 

While our board of directors and officers are generally accountable to our stockholders and us, the liability of our directors and officers to all parties is limited in certain respects under applicable state law and our articles of incorporation and bylaws, as in effect. Further, we have agreed or may agree to indemnify our directors and officers against liabilities not attributable to certain limited circumstances. This limitation of liability and indemnity may limit rights that our stockholders would otherwise have to seek redress against our directors and officers.

 

Additional issuances of stock options and warrants, convertible notes, and stock grants will cause additional substantial dilution to our stockholders.

 

Given our limited cash, liquidity, and revenues, it is likely that in the future, as in the past, we will issue additional warrants, stock grants, and convertible debt to finance our future business operations and acquisitions and strategic relationships. The issuance of additional shares of common stock, the exercise of warrants, and the conversion of debt to stock could cause additional dilution to our stockholders and could have further adverse effects on the market price for our securities or on our ability to obtain future financing. The 2018 increase in our authorized shares from two billion to ten billion increased the magnitude of this risk substantially.

 

The amount of authorized common stock may result in management implementing anti-takeover procedures by issuing new securities.

 

The proportion of unissued authorized shares to issued shares could, under certain circumstances, have an anti-takeover effect, for example, by permitting issuances that would dilute the stock ownership of a person seeking to effect a change in the composition of our board of directors or contemplating a tender offer or other transaction for the combination of our company with another entity. Although, we have no current plans to issue additional stock for this purpose, management could use the additional shares that are now available or that may be available after a possible further recapitalization to resist or frustrate a third-party transaction. Generally, no stockholder approval would be necessary for the issuance of all or any portion of the additional shares of common stock unless required by law or any rules or regulations to which we are subject.

 

Depending upon the consideration per share for any subsequent issuance of common stock, such issuance could have a dilutive effect on those stockholders who paid a higher consideration per share for their stock. Also, future issuances of common stock will increase the number of outstanding shares, thereby decreasing the percentage ownership—for voting, distributions, and all other purposes—represented by existing shares of common stock. The availability for issuance of the additional shares of common stock may be viewed as having the effect of discouraging an unsolicited attempt by another person or entity to acquire control of us. Although our board has no present intention of doing so, our authorized but unissued common stock could be issued in one or more transactions that would make a takeover of us more difficult or costly and, therefore, less likely. Holders of our common stock do not have any pre-emptive rights to acquire any additional securities issued by us.

 

  17  
     

 

Our stockholders may not recoup all or any portion of their investment upon our dissolution.

 

In the event of a liquidation, dissolution, or winding-up of our company, whether voluntary or involuntary, our net remaining proceeds and/or assets, after paying all of our debts and liabilities, will be distributed to the holders of common stock on a pro-rata basis. We cannot assure that we will have available assets to pay to the holders of common stock any amounts upon such a liquidation, dissolution, or winding-up of our company. In this event, our stockholders could lose some or all of their investment.

 

The sale of any additional shares of our common stock to Triton may cause dilution, and the sale of the shares of common stock acquired by Triton, or the perception that such sales may occur, could cause the price of our common stock to fall.

 

On December 29, 2018, we entered into certain agreements with Triton Funds, which agreements were amended April 11, 2019. Under these agreements we have the ability to require Triton to purchase up to $1.0 million of our common stock between the date that the effective registration statement. Up to 100,000,000 shares of our common stock are being offered for resale under the respective prospectus. The shares will be purchased at 85% of the lowest closing price of the common stock in the five consecutive trading days immediately preceding the delivery of a purchase notice to Triton from us. The purchase of shares by Triton is subject to certain limitations, including that Investor cannot purchase any shares that would result in it owning more than 4.9% of our common stock.

 

After Triton has acquired our shares, it may sell all, some, or none of those shares. Therefore, sales to Triton by us could result in substantial dilution to the interests of other holders of our common stock. Additionally, the sale of a substantial number of shares of our common stock to Triton, or the anticipation of such sales, could make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish. In addition, the per-share purchase price for these shares will be equal to 85% of the lowest closing price of the common stock for the five consecutive trading days immediately preceding our delivery of a purchase notice to Investor. Depending on market liquidity at the time, sales of these shares may cause the trading price of our common stock to fall. To date, Triton has purchased 39,215,648 shares of our common stock for $325,000.

 

As of June 27, 2019, the Company has ceased selling additional shares of our common stock to Triton by mutual agreement between the Company and Triton.

 

There is a limited market for our Common Stock, and there may never be an active and sustained market for our common stock and we cannot assure you that the common stock will remain liquid or that it will continue to be listed on a securities exchange.

 

Our Common Stock is subject to quotation on the OTCQB under the trading symbol “INVU”. An investor may find it difficult to obtain accurate quotations as to the market value of the Common Stock and trading of our Common Stock may be limited and sporadic from time to time. A more active market for the Common Stock may never develop and, if developed, may not be sustained. In addition, if we fail to meet the criteria set forth in SEC regulations, various requirements would be imposed by law on broker-dealers who sell our securities to persons other than established customers and accredited investors. Consequently, such regulations may deter broker-dealers from recommending or selling the Common Stock, which may further affect its liquidity. This would also make it more difficult for us to raise additional capital.

 

Until our Common Stock is listed on the NASDAQ or another stock exchange, we expect that our Common Stock will continue to be eligible to trade on the OTCQB market where our stockholders may find it more difficult to dispose of shares or obtain accurate quotations as to the market value of our Common Stock. Furthermore, in order to remain subject to quotation on the OTCQB, the trading price of our Common Stock must maintain certain trading levels, which, in not maintained, could result in our Common Stock being relegated to the OTC Pink. In such event, we will have to again qualify and make applications for quotation on the OTCQB, and there can be no assurance that our Common Stock will be accepted for the OTCQB.

 

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Our Common stock is subject to the “Penny Stock” rules of the SEC and the trading market in our stock is limited, which makes transactions in our stock cumbersome and may reduce the value of an investment.

 

The Securities and Exchange Commission has adopted Rule 15g-9 which establishes the definition of a “penny stock,” for the purposes relevant to us, as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require:

 

That a broker or dealer approve a person’s account for transactions in penny stocks; and
The broker or dealer receives from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.

 

In order to approve a person’s account for transactions in penny stocks, the broker or dealer must:

 

Obtain financial information and investment experience objectives of the person; and
Make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.

 

The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the Commission relating to the penny stock market, which, in highlight form:

 

Sets forth the basis on which the broker or dealer made the suitability determination; and
That the broker or dealer received a signed, written agreement from the investor prior to the transaction.

 

Generally, brokers may be less willing to execute transactions in securities subject to the “penny stock” rules. This may make it more difficult for investors to dispose of our Common stock and cause a decline in the market value of our stock.

 

Disclosure also must be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements must be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.

 

Financial Industry Regulatory Authority, Inc. (“FINRA”) sales practice requirements may limit a shareholder’s ability to buy and sell our common stock.

 

In addition to the “penny stock” rules described above, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our Common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

 

 Our common stock may be thinly traded, sale of your common stock may take a considerable amount of time.

 

The shares of our Common Stock, from time-to-time, may be thinly-traded on the OTCQB Market, meaning that the number of persons interested in purchasing our Common Stock at or near bid prices at any given time may be relatively small or non-existent. Consequently, there may be periods of several days or more when trading activity in our shares is minimal or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on share price. We cannot give you any assurance that a broader or more active public trading market for our Common Stock will develop or be sustained, or that current trading levels will be sustained. Due to these conditions, we can give you no assurance that you will be able to sell your shares at or near bid prices or at all if you need money or otherwise desire to liquidate your shares.

 

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Shares eligible for future sale may adversely affect the market.

 

From time to time, certain of our stockholders may be eligible to sell all or some of their shares of Common Stock by means of ordinary brokerage transactions in the open market pursuant to Rule 144 promulgated under the Securities Act, subject to certain limitations. In general, pursuant to amended Rule 144, non-affiliate stockholders may sell freely after six months subject only to the current public information requirement. Affiliates may sell after six months subject to the Rule 144 volume, manner of sale (for equity securities), current public information and notice requirements. To date, there were 121,345,168 shares reserved underlying outstanding convertible notes, which represent a significant multiple of from 4 to 10 times the number of shares actually subject to conversion under the terms of the outstanding convertible notes. Any substantial sales of our Common Stock pursuant to Rule 144 may have a material adverse effect on the market price of our Common Stock.

 

If we fail to maintain effective internal controls over financial reporting, the price of our common stock may be adversely affected.

 

Our internal control over financial reporting may have weaknesses and conditions that could require correction or remediation, the disclosure of which may have an adverse impact on the price of our Common Stock. We are required to establish and maintain appropriate internal controls over financial reporting. Failure to establish those controls, or any failure of those controls once established, could adversely affect our public disclosures regarding our business, prospects, financial condition or results of operations. In addition, management’s assessment of internal controls over financial reporting may identify weaknesses and conditions that need to be addressed in our internal controls over financial reporting or other matters that may raise concerns for investors. Any actual or perceived weaknesses and conditions that need to be addressed in our internal control over financial reporting or disclosure of management’s assessment of our internal controls over financial reporting may have an adverse impact on the price of our Common Stock.

 

Our annual and quarterly results may fluctuate, which may cause substantial fluctuations in our common stock price.

 

Our annual and quarterly operating results may in the future fluctuate significantly depending on factors including the timing of purchase orders, new product releases by us and other companies, gain or loss of significant customers, price discounting of our product, the timing of expenditures, product delivery requirements and economic conditions. Revenues related to our product are required to be recognized upon satisfaction of all applicable revenue recognition criteria. The recognition of revenues from our product is dependent on several factors, including, but not limited to, the terms of any license agreement and the timing of implementation of our products by our customers.

 

Any unfavorable change in these or other factors could have a material adverse effect on our operating results for a particular quarter or year, which may cause downward pressure on our Common stock price. We expect quarterly and annual fluctuations to continue for the foreseeable future.

 

We are subject to compliance with securities law, which exposes us to potential liabilities, including potential rescission rights.

 

We have offered and sold our Common Stock to investors pursuant to certain exemptions from the registration requirements of the Securities Act of 1933, as amended (the “Act”) as well as those of various state securities laws. The basis for relying on such exemptions is factual; that is, the applicability of such exemptions depends upon our conduct and that of those persons contacting prospective investors and making the Offering. We have not received a legal opinion to the effect that any of our prior Offerings were exempt from registration under any federal or state law. Instead, we have relied upon the operative facts as the basis for such exemptions, including information provided by investors themselves.

 

If any prior offering did not qualify for such exemption, an investor would have the right to rescind its purchase of the securities if it so desired. It is possible that if an investor should seek rescission, such investor would succeed. A comparable situation prevails under state law in those states where the securities may be offered without registration in reliance on the partial pre-emption from the registration or qualification provisions of such state statutes. If investors were successful in seeking rescission, we would face severe financial demands that could adversely affect our business and operations. Additionally, if we did not in fact qualify for the exemptions upon which it has relied, we may become subject to significant fines and penalties imposed by the SEC and state securities agencies.

 

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The availability of a large number of authorized but unissued shares of common stock may, upon their issuance, lead to dilution of existing stockholders.

 

We are authorized to issue 10,000,000,000 shares of Common Stock, $0.001 par value per share. To date, there were 3,062,481,329 shares of Common Stock outstanding. Additional shares may be issued upon the conversion of any outstanding convertible notes or convertible notes issued in the future, or otherwise authorized for issuance by our board of directors, from time-to-time, without further stockholder approval. The issuance of large numbers of shares of Common Stock, possibly at below market prices, is likely to result in substantial dilution to the interests of other stockholders. In addition, issuances of large numbers of shares may adversely affect the market price of our Common stock.

 

Our Articles of Incorporation, as amended, authorize 50,000,000 shares of preferred stock, $0.001 par value. The Board of Directors is authorized to provide for the issuance of unissued shares of preferred stock in one or more series, and to fix the number of shares and to determine the rights, preferences and privileges thereof. Accordingly, the board of directors may issue preferred stock which may convert into large numbers of shares of Common Stock and consequently lead to further dilution of other shareholders.

 

As of the date of this prospectus, we had 2,000,000 authorized shares of Series B Preferred. The Series B Preferred offered hereby will be fully paid and nonassessable. Our Board may, without the approval of holders of the Series B Preferred or our Common Stock, designate additional series of authorized preferred stock ranking junior to or on parity with the Series B Preferred and authorize the issuance of such shares. Designation of preferred stock ranking senior to the Series B Preferred will require approval of the holders of Series B Preferred, as described below in “Voting Rights.”

 

We have never paid cash dividends on our common stock and do not anticipate doing so in the foreseeable future.

 

We have never declared or paid cash dividends on our Common Stock. We currently plan to retain any earnings to finance the growth of our business rather than to pay cash dividends on our Common Stock. Nevertheless, we are required to pay cash dividends of 13% on our Series B Preferred, based upon the Stated Value of $25 per share. Payments of any cash dividends in the future, other than on our shares of Series B Preferred, will depend on our financial condition, results of operations and capital requirements, as well as other factors deemed relevant by our board of directors.

 

The Nevada Revised Statute contains provisions that could discourage, delay or prevent a change in control of our company, prevent attempts to replace or remove current management and reduce the market price of our stock.

 

Provisions in our articles of incorporation and bylaws may discourage, delay or prevent a merger or acquisition that our stockholders may consider favorable. For example, our certificate of incorporation authorizes our board of directors to issue up to ten million shares of “blank check” preferred stock. As a result, without further stockholder approval, the board of directors has the authority to attach special rights, including voting and dividend rights, to this preferred stock. With these rights, preferred stockholders could make it more difficult for a third party to acquire us.

 

We are also subject to the anti-takeover provisions of the NRS. Depending on the number of residents in the state of Nevada who own our shares, we could be subject to the provisions of Sections 78.378 et seq. of the Nevada Revised Statutes which, unless otherwise provided in the Company’s articles of incorporation or by-laws, restricts the ability of an acquiring person to obtain a controlling interest of 20% or more of our voting shares. Our articles of incorporation and by-laws do not contain any provision which would currently keep the change of control restrictions of Section 78.378 from applying to us.

 

We are subject to the provisions of Sections 78.411 et seq. of the Nevada Revised Statutes. In general, this statute prohibits a publicly held Nevada corporation from engaging in a “combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the combination or the transaction by which the person became an interested stockholder is approved by the corporation’s board of directors before the person becomes an interested stockholder. After the expiration of the three-year period, the corporation may engage in a combination with an interested stockholder under certain circumstances, including if the combination is approved by the board of directors and/or stockholders in a prescribed manner, or if specified requirements are met regarding consideration. The term “combination” includes mergers, asset sales and other transactions resulting in a financial benefit to the interested stockholder. Subject to certain exceptions, an “interested stockholder” is a person who, together with affiliates and associates, owns, or within three years did own, 10% or more of the corporation’s voting stock. A Nevada corporation may “opt out” from the application of Section 78.411 et seq. through a provision in its articles of incorporation or by-laws. We have not “opted out” from the application of this section.

 

Our publicly filed reports are subject to review by the SEC, and any significant changes or amendments required as a result of any such review may result in material liability to us and may have a material adverse impact on the trading price of the Company’s common stock.

 

The reports of publicly traded companies are subject to review by the SEC from time to time for the purpose of assisting companies in complying with applicable disclosure requirements, and the SEC is required to undertake a comprehensive review of a company’s reports at least once every three years under the Sarbanes-Oxley Act of 2002. SEC reviews may be initiated at any time. We could be required to modify, amend or reformulate information contained in prior filings as a result of an SEC review. Any modification, amendment or reformulation of information contained in such reports could be significant and result in material liability to us and have a material adverse impact on the trading price of the Company’s Common Stock.

 

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Use of Proceeds

 

We estimate that the net proceeds to us from the sale of all of the 2 million Units in this Offering will be approximately $45,500,000, based on the public Unit Offering Price of $25 per Unit, after deducting our estimated Offering expenses, including placement agent commissions of 9%, or approximately $4,500,000, assuming all of the Units are sold as a direct result of the selling efforts and introductions of placement agents. As we receive and accept subscriptions from investors, we will immediately pay the Escrow Agent an amount equal to 39% of the gross proceeds of the Units (or $9.75 per Series B Preferred), to be held by the Escrow Agent for timely transmittal to the Company for payment of the dividends to Series B Holders at each Dividend Payment Date. The amount of the escrow of $9.75 per Series B Preferred is equal to 13% per annum or $3.25 per share of Series B Preferred, for a period of three years, for the purpose of ensuring a fund will be available to pay investors the quarterly dividends of 13% during the first three years from the date of issuance on the shares of Series B Preferred.

 

We plan to use the remaining net proceeds to pay our indebtedness and any balance will be used for working capital and other general corporate purposes, which may include platform development, general and administrative matters, and capital expenditures. See the table under this Use of Proceeds, below. We may also use a portion of the net proceeds for the acquisition of, or investment in, technologies, solutions, or businesses that complement our business. Other than as disclosed in Item 1.01 of our Form 8-K filed on April 30, 2020 with respect to the Securities Purchase Agreement and related agreements with DBR Capital, LLC, as of the date of this prospectus, we do not have any understandings to acquire any businesses. Because this is a best effort Offering with no minimum, we cannot predict how much money we will ultimately raise.

 

We anticipate an approximate allocation of the use of net proceeds assuming we raise 25%, 50%, 75% or 100% of the maximum offering amount as follows:

 

      25%     50%     75%     100%     %(1)(2)
Dividend Reserves (3 Years)   $ 4,875,000     $ 9,750,000     $ 14,625,000     $ 19,500,000       39 %
Repay existing indebtedness, including interest thereon   $ 2,190,000     $ 2,190,000     $ 2,190,000     $ 2,190,000       5 %
Fund working capital and general corporate purposes   $ 4,085,000     $ 10,460,000     $ 16,385,000     $ 33,210,000       56 %
Offering Expenses   $ 100,000     $ 100,000     $ 100,000     $ 100,000       0 %
Subtotal – net proceeds   $ 11,150,000     $ 22,400,000     $ 33,650,000     $ 44,900,000       90 %
Total – gross proceeds   $ 12,500,000     $ 25,000,000     $ 37,500,000     $ 50,000,000       100.00 %

 

Other than as discussed above, we have not allocated any specific portion of the net proceeds to any particular purpose, and our management will have broad discretion in the allocation of the net proceeds. Furthermore, the amount and timing of our actual expenditures will depend on numerous factors, including the cash used in or generated by our operations, the level of our expected sales and marketing activities and the attractiveness of any additional acquisitions or investments. Pending these uses, we intend to invest the net proceeds that we receive from this Offering in short-term, investment-grade interest-bearing securities, such as money market accounts, certificates of deposit, commercial paper, and guaranteed obligations of the U.S. government.

 

If in the future we receive proceeds from the exercise of the Warrants, we expect such proceeds will be contributed to working capital and will be used for general corporate purposes.

 

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DIVIDEND POLICY

 

We have never declared or paid any cash dividends on our Common Stock or any other shares of capital stock. Except for the 13% cash dividends payable to Series B Holders, which dividends shall accrue on the Series B Preferred Stock daily and shall be cumulative from, and including, the applicable Issue Date, and shall be payable on a quarterly basis in arrears, on or about the 15th day after the end of each calendar quarter (each, a “Dividend Payment Date”). Reference is made to Exhibit 10.55.2 to this Registration Statement for the full terms of the Series B Preferred Stock, contained in the Amended Series B Certificate of Designation. The Amended Series B Certificate of Designation further provides, among other things, that: (i) at the Corporation’s sole discretion, dividends in amounts less than $50.00 may be held and not paid until the Dividend Payment Date on which the accumulated dividend payable to a Series B Holder exceeds $50.00; and (ii) the quarterly Dividends may be paid to Series B Holders by check, wire transfer or such other form of payment, including the type of currency (including but not limited to digital assets designed to work as a medium of exchange) agreed to by the Corporation and each Series B Holder.

 

Other than with respect to the dividends payable on our Series B Preferred, we currently intend to retain any future earnings and do not expect to pay any dividends on any other securities, including Common Stock for the foreseeable future. Any future determination to declare cash dividends (other than on the Series B Preferred) will be made at the discretion of our Board, subject to applicable laws, and will depend on a number of factors, including our financial condition, results of operations, capital requirements, contractual restrictions, general business conditions, and other factors that our Board may deem relevant. Further Nevada law limits when we can pay dividends on our securities. Further our continuing losses require us to use funds we receive in financings to meet our working capital needs. See “Description of Offered Securities – Dividends.”

 

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Capitalization

 

Set forth below is our cash and capitalization as of September 30, 2020:

 

● on an actual basis;

 

● on a pro forma as adjusted basis, reflecting the issuance of 2,000,000 shares of Series B Preferred and 10,000,000 Warrants offered by this prospectus, at $25 per share, assuming net proceeds of approximately $49,900,000, after deducting our estimated Offering expenses payable by us, as well as deducting activity recorded through September 30, 2020.

 

You should read the information in the below table together with our consolidated financial statements and related notes, and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” each included elsewhere in this prospectus.

 

    As of September 30, 2020  
    Actual     Pro Forma as Adjusted  
                 
Cash     583,955       30,373,122  
Restricted cash   $ 439,900     $ 19,500,000  
Total cash   $ 1,023,855     $ 49,873,122  
                 
Derivative liability   $ 4,265       276,621  
Total liabilities   $ 29,322,235     $ 29,594,591  
                 
Stockholders’ Equity (Deficit):                
Preferred stock, Series B Preferred, par value $0.001 per share; 50,000,000 shares authorized; 46,612 issued and outstanding, actual; 2,000,000 shares issued and outstanding, pro forma as adjusted   $ 47     $ 2,000  
Common stock, par value $0.001 per share; 10,000,000,000 shares authorized; actual 3,003,490,408 shares issued and outstanding, as of 12-31-2019   $ 3,003,490     $ 3,003,490  
Additional paid-in capital   $ 30,021,081     $ 78,581,472  
Accumulated deficit   $ (52,536,063 )   $ (52,636,063 )
Total stockholders’ equity (deficit)   $ (19,609,235 )   $ 28,853,109  
Total liabilities and stockholders’ equity (deficit)   $ 9,713,000     $ 58,447,700  

 

The table above is based on 2,929,481,329 shares of common stock outstanding as of September 30, 2020, and excludes, as of such date:

 

161,742,478 shares of our common stock issuable upon conversion of convertible debt;

 

233,060 shares of our common stock issuable upon exercise of warrants to purchase common stock;

 

100,000,000 shares of common stock reserved for future issuance under our 2020 Equity Incentive Plan (the “2020 Plan”).

 

  24  
     

 

FINANCIAL INFORMATION

 

FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 2020 AND FOR THE THREE AND SIX MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

 

INVESTVIEW, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

    September 30,     March 31,  
    2020     2020  
    (Unaudited)        
ASSETS                
Current assets:                
Cash and cash equivalents   $ 583,955     $ 137,177  
Restricted cash, current     151,489       -  
Prepaid assets     818,749       5,309,512  
Receivables     964,613       910,646  
Short-term advances     145,000       145,000  
Short-term advances - related party     500       500  
Other current assets     155,628       96,022  
Total current assets     2,819,934       6,598,857  
                 
Fixed assets, net     5,918,004       2,997,611  
                 
Other assets:                
Intangible assets, net     606,070       692,882  
Restricted cash, long term     288,411       -  
Operating lease right-of-use asset     72,093       99,465  
Deposits     8,488       11,173  
Total other assets     975,062       803,520  
                 
Total assets   $ 9,713,000     $ 10,399,988  
                 
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)                
Current liabilities:                
Accounts payable and accrued liabilities   $ 2,271,583     $ 2,896,012  
Payroll liabilities     171,412       880,349  
Customer advance     474,155       392,310  
Deferred revenue     780,396       612,500  
Derivative liability     4,265       793,495  
Dividend liability     37,775       -  
Operating lease liability, current     48,000       56,530  
Other current liabilities     14,077,200       11,407,200  
Related party payables, net of discounts     1,766,400       1,964,760  
Debt, net of discounts     1,571,921       1,719,326  
Total current liabilities     21,203,107       20,722,482  
                 
Operating lease liability, long term     31,428       50,268  
Other long term liabilities, net of deferred interest     8,087,700       3,885,464  
Total long term liabilities     8,119,128       3,935,732  
                 
Total liabilities     29,322,235       24,658,214  
                 
Commitments and contingencies     -       -  
                 
Stockholders’ equity (deficit):                
Preferred stock, par value: $0.001; 50,000,000 shares authorized, 46,612 and none issued and outstanding as of September 30, 2020 and March 31, 2020, respectively     47       -  
Common stock, par value $0.001; 10,000,000,000 shares authorized; 2,929,481,329 and 3,214,490,408 shares issued and outstanding as of September 30, 2020 and March 31, 2020, respectively     2,929,481       3,214,490  
Additional paid in capital     30,021,081       28,929,516  
Accumulated other comprehensive income (loss)     (23,781 )     (20,058 )
Accumulated deficit     (52,536,063 )     (46,382,174 )
Total stockholders’ equity (deficit)     (19,609,235 )     (14,258,226 )
                 
Total liabilities and stockholders’ equity (deficit)   $ 9,713,000     $ 10,399,988  

 

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

 

F- 1
 

 

INVESTVIEW, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME

(Unaudited)

 

    Three Months Ended September 30,     Six Months Ended September 30,  
    2020     2019     2020     2019  
                         
Revenue:                                
Subscription revenue, net of refunds, incentives, credits, and chargebacks   $ 5,255,888     $ 7,236,755     $ 9,499,145     $ 14,748,468  
Mining revenue     2,493,739       -       3,836,285       -  
Fee revenue     3,710       5,369       7,723       5,369  
Total revenue, net     7,753,337       7,242,124       13,343,153       14,753,837  
                                 
Operating costs and expenses:                                
Cost of sales and service     1,724,809       289,045       2,637,133       532,498  
Commissions     3,416,713       4,347,177       6,790,544       9,216,147  
Selling and marketing     627,356       401,979       844,940       814,467  
Salary and related     816,554       2,567,592       2,037,389       3,711,446  
Professional fees     232,062       346,337       659,310       655,783  
General and administrative     364,826       1,363,113       2,809,618       2,721,756  
Total operating costs and expenses     7,182,320       9,315,243       15,778,934       17,652,097  
                                 
Net loss from operations     571,017       (2,073,119 )     (2,435,781 )     (2,898,260 )
                                 
Other income (expense):                                
Gain (loss) on debt extinguishment     812,111       1,281,477       829,937       1,281,477  
Gain (loss) on fair value of derivative liability     (20,847 )     2,358,447       326,788       599,257  
Gain on deconsolidation     -       -       -       53,739  
Impairment expense     (66,645 )     -       (66,645 )     -  
Realized gain (loss) on cryptocurrency     1,096       (1,077 )     1,096       (667 )
Unrealized gain (loss) on cryptocurrency     85,331       (122,080 )     176,817       25,330  
Interest expense     (2,480,067 )     (1,944,640 )     (4,727,165 )     (2,490,637 )
Interest expense, related parties     (210,805 )     (1,251,094 )     (389,720 )     (1,251,094 )
Other income (expense)     123,346       358       186,408       (71,284 )
Total other income (expense)     (1,756,480 )     321,391       (3,662,484 )     (1,853,879 )
                                 
Income (loss) before income taxes     (1,185,463 )     (1,751,728 )     (6,098,265 )     (4,752,139 )
Income tax expense     (2,297 )     (1,838 )     (3,282 )     (7,382 )
                                 
Net income (loss)     (1,187,760 )     (1,753,566 )     (6,101,547 )     (4,759,521 )
                                 
Dividends on Preferred Stock     (52,342 )     -       (52,342 )     -  
                                 
Net income applicable to common shareholders   $ (1,240,102 )   $ (1,753,566 )   $ (6,153,889 )   $ (4,759,521 )
                                 
Income (loss) per common share, basic and diluted   $ (0.00 )   $ (0.00 )   $ (0.00 )   $ (0.00 )
                                 
Weighted average number of common shares outstanding, basic and diluted     2,985,916,112       2,840,281,449       3,109,673,727       2,234,117,482  
                                 
Other comprehensive income, net of tax:                                
Foreign currency translation adjustments   $ (4,359 )   $ (1,585 )   $ (3,723 )   $ (20,560 )
Total other comprehensive income     (4,359 )     (1,585 )     (3,723 )     (20,560 )
Comprehensive income (loss)   $ (1,192,119 )   $ (1,755,151 )   $ (6,105,270 )   $ (4,780,081 )

 

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

 

F- 2
 

 

INVESTVIEW, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

THREE AND SIX MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Unaudited)

 

                                  Accumulated                    
                            Additional     Other                    
    Preferred stock     Common stock     Paid in     Comprehensive     Accumulated     Noncontrolling        
    Shares     Amount     Shares     Amount     Capital     Income     Deficit     Interest     Total  
Balance, March 31, 2019     -     $ -       2,640,161,318     $ 2,640,161     $ 23,758,917     $ 1,363     $ (25,096,983 )   $ 51,485     $ 1,354,943  
Common stock issued for cash     -       -       39,215,648       39,216       285,784       -       -       -       325,000  
Offering costs     -       -       -       -       101,387       -       -       -       101,387  
Deconsolidation of Kuvera LATAM     -       -       -       -       -       -       -       (51,485 )     (51,485 )
Foreign currency translation adjustment     -       -       -       -       -       (18,975 )     -       -       (18,975 )
Net income (loss)     -       -       -       -       -       -       (3,005,955 )     -       (3,005,955 )
Balance, June 30, 2019     -       -       2,679,376,966       2,679,377       24,146,088       (17,612 )     (28,102,938 )     -       (1,295,085 )
Common stock issued for cash     -       -       13,000,000       13,000       312,000       -       -       -       325,000  
Common stock issued for services and compensation     -       -       241,000,000       241,000       1,274,915       -       -       -       1,515,915  
Common stock repurchase     -       -       (5,150 )     (5 )     (97 )     -       -       -       (102 )
Common stock cancelled     -       -       (222,500,000 )     (222,500 )     (3,157,500 )     -       -       -       (3,380,000 )
Beneficial conversion feature     -       -       -       -       1,000,000       -       -       -       1,000,000  
Foreign currency translation adjustment     -       -       -       -       -       (1,585 )     -       -       (1,585 )
Net income (loss)     -       -       -       -       -       -       (1,753,566 )     -       (1,753,566 )
Balance, September 30, 2019     -     $ -       2,710,871,816     $ 2,710,872     $ 23,575,406     $ (19,197 )   $ (29,856,504 )   $ -     $ (3,589,423 )
                                                                         
Balance, March 31, 2020     -     $ -       3,214,490,408     $ 3,214,490     $ 28,929,516     $ (20,058 )   $ (46,382,174 )   $ -     $ (14,258,226 )
Common stock issued for services and compensation     -       -       21,000,000       21,000       397,954       -       -       -       418,954  
Share repurchase     -       -       (9,079 )     (9 )     (263 )     -       -       -       (272 )
Beneficial conversion feature     -       -       -       -       2,000,000       -       -       -       2,000,000  
Foreign currency translation adjustment     -       -       -       -       -       636       -       -       636  
Net income (loss)     -       -       -       -       -       -       (4,913,787 )     -       (4,913,787 )
Balance, June 30, 2020     -       -       3,235,481,329       3,235,481       31,327,207       (19,422 )     (51,295,961 )     -       (16,752,695 )
Preferred stock issued for cash     46,612       47       -       -       1,158,754       -       -       -       1,158,801  
Offering costs     -       -       -       -       (20,994 )     -       -       -       (20,994 )
Common stock issued for services and compensation     -       -       -       -       376,282       -       -       -       376,282  
Common stock forfeited     -       -       (200,000,000 )     (200,000 )     (3,180,000 )     -       -       -       (3,380,000 )
Common stock repurchase     -       -       (106,000,000 )     (106,000 )     (14,000 )     -       -       -       (120,000 )
Forgiveness of accrued payroll     -       -       -       -       373,832       -       -       -       373,832  
Dividends     -       -       -       -       -       -       (52,342 )     -       (52,342 )
Foreign currency translation adjustment     -       -       -       -       -       (4,359 )     -       -       (4,359 )
Net income (loss)     -       -       -       -       -       -       (1,187,760 )     -       (1,187,760 )
Balance, September 30, 2020     46,612     $ 47       2,929,481,329     $ 2,929,481     $ 30,021,081     $ (23,781 )   $ (52,536,063 )   $ -     $ (19,609,235 )

 

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

 

F- 3
 

 

INVESTVIEW INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

    Six Months Ended September 30,  
    2020     2019  
CASH FLOWS FROM OPERATING ACTIVITIES:                
Net loss   $ (6,101,547 )   $ (4,759,521 )
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:                
Depreciation     982,819       36,007  
Amortization of debt discount     703,511       1,892,791  
Amortization of long-term license agreement     -       75,406  
Amortization of intangible assets     86,812       169,539  
Stock issued for services and compensation     795,236       1,515,915  
Loan fees on new borrowings     -       841,140  
Offering costs     6       -  
Lease cost, net of repayment     2       -  
(Gain) on deconsolidation     -       (53,739 )
(Gain) loss on debt extinguishment     (829,937 )     (1,281,477 )
Loss on fair value of derivative liability     (326,788 )     (599,257 )
Realized (gain) loss on cryptocurrency     (1,096 )     667  
Unrealized (gain) loss on cryptocurrency     (176,817 )     (25,330 )
Impairment expense     66,645       -  
Changes in operating assets and liabilities:                
Receivables     (53,967 )     (18,538 )
Prepaid assets     (1,141,805 )     (1,283,764 )
Short-term advances     -       (100,000 )
Short-term advances from related parties     -       (10,000 )
Other current assets     118,307       (517,051 )
Deposits     2,685       (3,130 )
Accounts payable and accrued liabilities     (1,001,276 )     (19,420 )
Customer advance     81,845       3,448,476  
Deferred revenue     167,896       (94,985 )
Other liabilities     6,872,236       3,529,296  
Accrued interest     107,025       131,799  
Accrued interest, related parties     309,837       649,999  
Net cash provided by (used in) operating activities     661,629       3,524,823  
                 
CASH FLOWS FROM INVESTING ACTIVITIES                
Cash paid for fixed assets     (1,717,289 )     (1,720,116 )
Net cash provided by (used in) investing activities     (1,717,289 )     (1,720,116 )
                 
CASH FLOWS FROM FINANCING ACTIVITIES:                
Proceeds from related parties     4,474,137       1,459,500  
Repayments for related party payables     (3,036,216 )     (1,369,500 )
Proceeds from debt     1,405,300       1,322,651  
Repayments for debt     (2,030,344 )     (2,745,024 )
Payments for share repurchase     (272 )     (102 )
Dividends paid     (14,567 )     -  
Proceeds from the sale of stock     1,165,300       650,000  
Payments for financing costs     (21,000 )     -  
Net cash provided by (used in) financing activities     1,942,338       (682,475 )
                 
Effect of exchange rate translation on cash     -       2,297  
                 
Net increase (decrease) in cash, cash equivalents, and restricted cash     886,678       1,124,529  
Cash, cash equivalents, and restricted cash - beginning of period     137,177       133,644  
Cash, cash equivalents, and restricted cash - end of period   $ 1,023,855     $ 1,258,173  
                 
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION                
Cash paid during the period for:                
Interest   $ 275,192     $ 51,000  
Income taxes   $ 3,282     $ 5,544  
Non cash investing and financing activities:                
Prepaid assets reclassified to fixed assets   $ 2,252,568     $ -  
Beneficial conversion feature   $ 2,000,000     $ 1,000,000  
Cancellation of shares   $ -     $ 3,380,000  
Changes in equity for offering costs accrued   $ -     $ 101,387  
Derivative liability recorded as a debt discount   $ -     $ 365,000  
Recognition of lease liability and ROU asset at lease commencement   $ -     $ 131,244  
Shares forfeited   $ 3,380,000     $ -  
Share repurchase   $ 120,000     $ -  
Reclassification of related party debt   $ 26,000     $ -  
Dividends declared but not yet paid   $ 37,775     $ -  
Forgiveness of accrued payroll   $ 373,832     $ -  

 

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

 

F- 4
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS

 

Organization

 

Investview, Inc. was incorporated on January 30, 1946, under the laws of the state of Utah as the Uintah Mountain Copper Mining Company. In January 2005 the Company changed domicile to Nevada, and changed its name to Voxpath Holding, Inc. In September of 2006 the Company merged The Retirement Solution Inc. through a Share Purchase Agreement into Voxpath Holdings, Inc. and then changed its name to TheRetirementSolution.Com, Inc. In October 2008 the Company changed its name to Global Investor Services, Inc., before changing its name to Investview, Inc., on March 27, 2012.

 

On March 31, 2017, we entered into a Contribution Agreement with the members of Wealth Generators, LLC, a limited liability company (“Wealth Generators”), pursuant to which the Wealth Generators members agreed to contribute 100% of the outstanding securities of Wealth Generators in exchange for an aggregate of 1,358,670,942 shares of our common stock. The closing of the Contribution Agreement was effective April 1, 2017, and Wealth Generators became our wholly owned subsidiary and the former members of Wealth Generators became our stockholders and control the majority of our outstanding common stock.

 

On June 6, 2017, we entered into an Acquisition Agreement with Market Trend Strategies, LLC, a company whose members are also former members of our management. Under the Acquisition Agreement, we spun-off our operations that existed prior to the merger with Wealth Generators and sold the intangible assets used in those pre-merger operations in exchange for Market Trend Strategies’ assumption of $419,139 in pre-merger liabilities.

 

On February 28, 2018, we filed a name change for Wealth Generators, LLC to Kuvera, LLC (“Kuvera”) and on May 7, 2018 we established WealthGen Global, LLC as a Utah limited liability company and a wholly owned subsidiary of Investview, Inc.

 

On July 20, 2018, we entered into a Purchase Agreement with United Games Marketing LLC, a Utah limited liability company, to purchase its wholly owned subsidiaries United Games, LLC and United League, LLC for 50,000,000 shares of our common stock.

 

On November 12, 2018, we established Kuvera France, S.A.S. to handle sales of our financial education and research in the European Union.

 

On December 30, 2018, our wholly owned subsidiary S.A.F.E. Management, LLC received its registration and disclosure approval from the National Futures Association. S.A.F.E. Management, LLC is now a New Jersey State Registered Investment Adviser, Commodities Trading Advisor, Commodity Pool Operator, and approved for over the counter FOREX advisory services.

 

On January 17, 2019 we renamed our non-operating wholly owned subsidiary WealthGen Global, LLC to SafeTek, LLC, a Utah Limited Liability Company.

 

Effective July 22, 2019 we renamed our non-operating wholly owned subsidiary Razor Data, LLC to APEX Tek, LLC, a Utah Limited Liability Company.

 

Nature of Business

 

Investview owns a number of companies that each operate independently but are accretive to one another. Investview is establishing a portfolio of wholly owned subsidiaries delivering leading edge technologies, services and research, dedicated primarily to the individual consumer. Following is a description of each of our companies.

 

Kuvera, LLC provides research, education, and investment tools designed to assist the self-directed investor in successfully navigating the financial markets. These services include research, trade alerts, and live trading rooms that include instruction in equities, options, FOREX, ETFs, binary options, crowdfunding and cryptocurrency sector education. In addition to trading tools and research, we also offer full education and software applications to assist the individual in debt reduction, increased savings, budgeting, and proper tax management. Each product subscription includes a core set of trading tools/research along with the personal finance management suite to provide an individual with complete access to the information necessary to cultivate and manage his or her financial situation.

 

F- 5
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

Different packages are available through a monthly subscription that can be cancelled at any time at the discretion of the customer. A unique component of the product marketing plan is the distribution method whereby all subscriptions are sold via current participating customers who choose to distribute and sell the services by participating in the bonus plan. The bonus plan participation is purely optional but enables individuals to create an additional income stream to further support their personal financial goals and objectives.

 

Kuvera France S.A.S. is our entity in France that will distribute Kuvera products and services throughout the European Union.

 

S.A.F.E. Management, LLC is a Registered Investment Adviser and Commodity Trading Adviser that has been established to deliver automated trading strategies to individuals who find they lack the time to trade for themselves.

 

United League, LLC owns a number of proprietary technologies including FIREFAN a social app for sports enthusiasts. Technologies created to support any of the Investview companies are held under the United League structure.

 

United Games, LLC is the distribution network for United League technologies. Since the acquisition of United Games in July of 2018, we are working to combine the distributors of Kuvera and United Games. This is an on-going process that is not yet complete.

 

SAFETek, LLC (formerly WealthGen Global, LLC) is a new addition that we are currently establishing for expansion plans in the high-speed processing and cloud computing environment.

 

Apex Tek, LLC (formerly Razor Data, LLC) delivers the APEX program which permits individuals to purchase assets that will generate monthly cash flow. As of September 30, 2020 we have ceased selling the APEX package. We may re-introduce APEX at a later date after further evaluation of the model.

 

Investment Tools & Training, LLC currently has no operations or activities.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations (Regulation S-X) of the Securities and Exchange Commission (the “SEC”) and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results of operations for the six months ended September 30, 2020, are not necessarily indicative of the operating results that may be expected for the year ending March 31, 2021. These unaudited condensed consolidated financial statements should be read in conjunction with the March 31, 2020 consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended March 31, 2020.

 

Principles of Consolidation

 

The consolidated financial statements include the accounts of Investview, Inc., and our wholly owned subsidiaries, Kuvera, LLC, Investment Tools & Training, LLC, Apex Tek, LLC (formerly Razor Data, LLC), S.A.F.E. Management, LLC, SafeTek, LLC (formerly WealthGen Global, LLC), United Games, LLC, United League, LLC, and Kuvera France S.A.S. Through March 31, 2019 we had determined that one affiliated entity, Kuvera LATAM S.A.S., which we previously conducted business with, was a variable interest entity and we were the primary beneficiary of the entity’s activities, which are similar to those of Kuvera, LLC. As a result, through March 31, 2019 we had consolidated the accounts of this variable interest entity into the consolidated financial statements. Further, because the Company did not have any ownership interest in this variable interest entity, the Company had allocated the contributed capital in the variable interest entity as a component of noncontrolling interest. As of April 1, 2019 Kuvera LATAM S.A.S. had no operations and ceased to exist, therefore, as of that date, no consolidation of the entity was necessary and we recorded a gain on deconsolidation of $53,739 to eliminate the intercompany account with Kuvera LATAM S.A.S. All intercompany transactions and balances have been eliminated in consolidation.

 

Financial Statement Reclassification

 

Certain account balances from prior periods have been reclassified in these consolidated financial statements to conform to current period classifications.

 

F- 6
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

Use of Estimates

 

The preparation of these unaudited condensed consolidated financial statements in conformity with 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 revenue and expenses during the reporting period. Actual results could differ from those estimates.

 

Foreign Exchange

 

We have consolidated the accounts of Kuvera France S.A.S. into our consolidated financial statements. The operations of Kuvera France S.A.S. are conducted in France and its functional currency is the Euro.

 

The financial statements of Kuvera France S.A.S. are prepared using their functional currency and have been translated into U.S. dollars (“USD”). Assets and liabilities are translated into USD at the applicable exchange rates at period-end. Stockholders’ equity is translated using historical exchange rates. Revenue and expenses are translated at the average exchange rates for the period. Any translation adjustments are included as foreign currency translation adjustments in accumulated other comprehensive income in our stockholders’ equity (deficit).

 

The following rates were used to translate the accounts of Kuvera France S.A.S. and Kuvera LATAM S.A.S. into USD at the following balance sheet dates.

 

    September 30, 2020     March 31, 2020  
Euro to USD     1.17300       1.10314  

 

The following rates were used to translate the accounts of Kuvera France S.A.S. into USD for the following operating periods.

 

    Six Months Ended September 30,  
    2020     2019  
Euro to USD     1.135711       1.11795  

 

Restricted Cash

 

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheet that sum to the total of the same such amounts shown in the statement of cash flows.

 

    September 30, 2020     March 31, 2020  
Cash and cash equivalents   $ 583,955     $ 137,177  
Restricted cash, current     151,489       -  
Restricted cash, long term     288,411       -  
Total cash, cash equivalents, and restricted cash shown on the statement of cash flows   $ 1,023,855     $ 137,177  

 

Amount included in restricted cash represent funds required to be held in an escrow account by a contractual agreement and will be used for paying dividends to our Series B Preferred Stock holders.

 

F- 7
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

Cryptocurrencies

 

We hold cryptocurrency-denominated assets (“cryptocurrencies”) and include them in our consolidated balance sheet as other current assets. We record cryptocurrencies at fair market value and recognize the change in the fair value of our cryptocurrencies as an unrealized gain or loss in the consolidated statement of operations. As of September 30, 2020, and March 31, 2020, the fair value of our cryptocurrencies was $155,628 and $96,022, respectively. During the six months ended September 30, 2020 we recorded $1,096 and $176,817 as a total realized and unrealized gain (loss) on cryptocurrency, respectively. During the six months ended September 30, 2019 we recorded $(667) and $25,330 as a total realized and unrealized gain (loss) on cryptocurrency, respectively. During the three months ended September 30, 2020, we recorded $1,096 and $85,331 as a total realized and unrealized gain (loss) on cryptocurrency, respectively. During the three months ended September 30, 2019 we recorded $(1,077) and $(122,080) as a total realized and unrealized gain (loss) on cryptocurrency, respectively.

 

Fixed Assets

 

Fixed assets are stated at cost and depreciated using the straight-line method over their estimated useful lives. When retired or otherwise disposed, the carrying value and accumulated depreciation of the fixed asset is removed from its respective accounts and the net difference less any amount realized from disposition is reflected in earnings. Expenditures for maintenance and repairs which do not extend the useful lives of the related assets are expensed as incurred.

 

As of September 30, 2020, fixed assets were made up of the following:

 

    Estimated        
    Useful        
    Life        
    (years)     Value  
Furniture, fixtures, and equipment     10     $ 12,792  
Computer equipment     3       21,143  
Data processing equipment     3       7,095,515  
              7,129,450  
Accumulated depreciation as of September 30, 2020             (1,211,446 )
Net book value, September 30, 2020           $ 5,918,004  

 

Total depreciation expense for the six months ended September 30, 2020 and 2019, was $982,819 and $36,007, respectively.

 

Long-Lived Assets – Intangible Assets & License Agreement

 

We account for our intangible assets and long-term license agreement in accordance with ASC Subtopic 350-30, General Intangibles Other Than Goodwill, and ASC Subtopic 360-10-05, Accounting for the Impairment or Disposal of Long-Lived Assets. ASC Subtopic 350-30 requires assets to be measured based on the fair value of the consideration given or the fair value of the assets (or net assets) acquired, whichever is more clearly evident and, thus, more reliably measurable. Further, ASC Subtopic 350-30 requires an intangible asset to be amortized over its useful life and for the useful life to be evaluated every reporting period to determine whether events or circumstances warrant a revision to the remaining period of amortization. If the estimate of useful life is changed the remaining carrying amount of the intangible asset is amortized prospectively over the revised remaining useful life. Costs of internally developing, maintaining, or restoring intangible assets are recognized as an expense when incurred.

 

In June of 2017 we issued 80,000,000 shares of common stock with a value of $2,256,000 for a 15-year license agreement. Amortization recognized for the six months ended September 30, 2020 and 2019 was $0 and $75,406, respectively, and the long-term license agreement was recorded at a net value of $0 as of September 30, 2020 and March 31, 2020 due to the asset being impaired as of March 31, 2020.

 

In June of 2018 we purchased United Games, LLC and United League, LLC and recorded the transaction as a business combination. Intangible assets acquired in the business combination were recorded at fair value on the date of acquisition and are being amortized on a straight-line method over their estimated useful lives. During the nine months ended December 31, 2019 we impaired the value of the customer contracts/relationships originally acquired.

 

  Estimated        
    Useful        
    Life        
    (years)     Value  
FireFan mobile application     4     $ 331,000  
Back office software     10       408,000  
Tradename/trademark - FireFan     5       248,000  
Tradename/trademark - United Games     0.45       4,000  
Customer contracts/relationships     n/a       -  
              991,000  
Accumulated amortization as of December 31, 2019             (254,949 )
Net book value, December 31, 2019           $ 736,051  

 

F- 8
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

In June of 2018 we purchased United Games, LLC and United League, LLC and recorded the transaction as a business combination. Intangible assets acquired in the business combination were recorded at fair value on the date of acquisition and are being amortized on a straight-line method over their estimated useful lives. As of September 30, 2020 intangible assets were made up of the following:

 

    Estimated        
    Useful        
    Life        
    (years)     Value  
FireFan mobile application     4     $ 331,000  
Back office software     10       408,000  
Tradename/trademark - FireFan     5       248,000  
Tradename/trademark - United Games     0.45       4,000  
              991,000  
Accumulated amortization as of September 30, 2020             (384,930 )
Net book value, September 30, 2020           $ 606,070  

 

Amortization expense for the six months ended September 30, 2020 and 2019 was $86,812 and $169,539, respectively. Amortization expense is expected to be as follows:

 

Remainder of 2021   $ 86,338  
Fiscal year ending March 31, 2022     173,150  
Fiscal year ending March 31, 2023     173,150  
Fiscal year ending March 31, 2024     32,589  
Fiscal year ending March 31, 2025     6,148  
Fiscal year ending March 31, 2026 and beyond     134,695  
    $ 606,070  

 

Impairment of Long-Lived Assets

 

We have adopted ASC Subtopic 360-10, Property, Plant and Equipment (“ASC 360-10”). ASC 360-10 requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable or when the historical cost carrying value of an asset may no longer be appropriate. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve break-even operating results over an extended period.

 

We evaluate the recoverability of long-lived assets based upon future net cash flows expected to result from the asset, including eventual disposition. Should impairment in value be indicated, the carrying value of intangible assets will be adjusted and an impairment loss is recorded equal to the difference between the asset’s carrying value and fair value or disposable value.

 

During the six months ended September 30, 2020 we fully impaired data processing equipment that had a cost basis of $84,939 and we fully impaired a computer that had a cost basis of $1,609 because the assets were no longer in use. The accumulated depreciation of the assets at the time they were written off was $19,903, therefore we recognized impairment expense of $66,645 for the six months ended September 30, 2020.  No impairment expense was recognized during the six months ended September 30, 2019.

 

Fair Value of Financial Instruments

 

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, based on our principal or, in the absence of a principal, most advantageous market for the specific asset or liability.

 

U.S. generally accepted accounting principles provide for a three-level hierarchy of inputs to valuation techniques used to measure fair value, defined as follows:

 

  Level 1: Inputs that are quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity can access.
     
  Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability, including:

 

  - quoted prices for similar assets or liabilities in active markets;
  - quoted prices for identical or similar assets or liabilities in markets that are not active;
  - inputs other than quoted prices that are observable for the asset or liability; and
  - inputs that are derived principally from or corroborated by observable market data by correlation or other means.

 

  Level 3: Inputs that are unobservable and reflect management’s own assumptions about the inputs market participants would use in pricing the asset or liability based on the best information available in the circumstances (e.g., internally derived assumptions surrounding the timing and amount of expected cash flows).

 

F- 9
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

Our financial instruments consist of cash, accounts receivable, accounts payable, and debt. We have determined that the book value of our outstanding financial instruments as of September 30, 2020 and March 31, 2020, approximates the fair value due to their short-term nature.

 

Items recorded or measured at fair value on a recurring basis in the accompanying consolidated financial statements consisted of the following items as of September 30, 2020:

 

    Level 1     Level 2     Level 3     Total  
Cryptocurrencies   $ 155,628     $ -     $ -     $ 155,628  
Total Assets   $ 155,628     $ -     $ -     $ 155,628  
                                 
Derivative liability   $ -     $ -     $ 4,265     $ 4,265  
Total Liabilities   $ -     $ -     $ 4,265     $ 4,265  

 

Items recorded or measured at fair value on a recurring basis in the accompanying consolidated financial statements consisted of the following items as of March 31, 2020:

 

    Level 1     Level 2     Level 3     Total  
Cryptocurrencies   $ 96,022     $ -     $ -     $ 96,022  
Total Assets   $ 96,022     $ -     $ -     $ 96,022  
                                 
Derivative liability   $ -     $ -     $ 793,495     $ 793,495  
Total Liabilities   $ -     $ -     $ 793,495     $ 793,495  

 

Sale and Leaseback

 

Through our wholly-owned subsidiary, APEX Tex, LLC, we sold high powered data processing equipment (“APEX”) to our customers and they leased the equipment back to SAFETek, LLC, another of our wholly-owned subsidiaries. We account for these transactions under ASC 842-40 where the leaseback has been deemed a sales-type lease due to the lease term generally covering the entire economic life of the equipment and our likelihood to purchase the asset at the end of the lease term. In accordance with ASC 842-40 we have recorded the data processing equipment as a fixed asset on our balance sheet and we have accounted for the amounts received for the equipment as a financial liability, in other liabilities on our balance sheet. Further, we will recognize interest on the financial liability over the term of the lease to ensure the financial liability equates to the total amounts to be paid over the life of the lease. During the six months ended September 30, 2020 we had the following activity related to our sale and leaseback transactions:

 

    Total Financial Liability     Contra-Liability     Net Financial Liability     Current [1]     Long Term  
Balance as of March 31, 2020   $ 53,828,000     $ (38,535,336 )   $ 15,292,664     $ 11,407,200     $ 3,885,464  
Proceeds from sales of APEX     5,001,622       -       5,001,622                  
Interest recorded on financial liability     8,348,378       (8,348,378 )     -                  
Payments made for leased equipment     (2,125,300 )     -       (2,125,300 )              
Interest expense     -       3,995,914       3,995,914                  
Balance as of September 30, 2020   $ 65,052,700     $ (42,887,800 )   $ 22,164,900     $ 14,077,200     $ 8,087,700  

 

[1] Represents lease payments to be made in the next 12 months

 

F- 10
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

The $42,887,800 is expected to be recognized into interest as follows:

 

Remainder of 2021   $ 4,782,861  
Fiscal year ending March 31, 2022     9,565,721  
Fiscal year ending March 31, 2023     9,565,721  
Fiscal year ending March 31, 2024     9,565,721  
Fiscal year ending March 31, 2025 and beyond     9,407,776  
    $ 42,887,800  

 

During the six months ended September 30, 2020 we received additional proceeds for APEX sales which were recorded in the customer advance amount shown on our balance sheet, resulting in a net increase in the account of $81,845 since March 31, 2020. As of September 30, 2020 we have ceased selling the APEX package. We may re-introduce APEX at a later date after further evaluation of the model.

 

Revenue Recognition

 

Subscription Revenue

 

The majority of our revenue is generated by subscription sales and payment is received at the time of purchase. We recognize subscription revenue in accordance with ASC 606-10 where revenue is measured based on a consideration specified in a contract with a customer and recognized when we satisfy the performance obligation specified in each contract. Our performance obligation is to provide services over a fixed subscription period, therefore we recognize revenue rateably over the subscription period and deferred revenue is recorded for the portion of the subscription period subsequent to each reporting date. Additionally, we offer a 10-day trial period to subscription customers, during which a full refund can be requested if a customer does not like the product. Revenues are deferred during the trial period as collection is not probable until that time has passed. Revenues are presented net of refunds, sales incentives, credits, and known and estimated credit card chargebacks.

 

Equipment Sales

 

We generate revenue from the sale of high-speed computer processing equipment that is used for any of the following intense processing activities: protein folding, CGI rendering, Game Streaming, Machine & Deep Learning, Mining, Independent Financial Verification, and general high-speed computing. We recognize equipment sales revenue in accordance with ASC 606-10 where revenue is measured based on a consideration specified in a contract with a customer and recognized when we satisfy the performance obligation specified in each contract. Our performance obligation is to deliver an equipment package to our customers which includes hardware, software, and firmware and is drop-shipped to a hosting data center. We receive payment at the time of purchase and recognize revenue when the equipment package is delivered and ready for maintenance and hosting, which our customers arrange for, and obtain, from a separate third party that provides such services.

 

Cryptocurrency Mining Service Revenue

 

We generate revenue from the sale of cryptocurrency mining services to our customers through an arrangement with a third-party supplier. We recognize cryptocurrency mining service revenue in accordance with ASC 606-10 where revenue is measured based on a consideration specified in a contract with a customer and recognized when we satisfy the performance obligation specified in each contract. Our performance obligation is to arrange for the third-party to provide mining services to our customers and payment is received at the time of purchase, therefore revenue is recognized upon receipt of payment. We recognize revenue in the amount of the fee to which we are entitled to as an agent, or the amount of consideration that we retain after paying the third-party the consideration received in exchange for the services the third-party is to provide.

 

Mining Revenue

 

Through our wholly owned subsidiary, SAFETek, LLC, we lease equipment under a sales-type lease and use the equipment on blockchain networks to validate and add blocks of transactions to blockchain ledgers (commonly referred to as “mining”). As compensation for mining we are issued fees from processors and/or block rewards that are newly created cryptocurrency units granted to us. Our mining activities constitute our ongoing major and central operations of SAFETek, LLC. Because we do not have contracts, nor do we have customers associated with our mining revenue, we recognize revenue when fees and/or rewards are settled, or ultimately granted to us as a result of our mining activities.

 

Fee Revenue

 

We generate fee revenue from our customers through SAFE Management, our subsidiary licensed as a Registered Investment Advisor and Commodities Trading Advisor. We recognize fee revenue in accordance with ASC 606-10 where revenue is measured based on a consideration specified in a contract with a customer and recognized when we satisfy the performance obligation specified in each contract. Our performance obligation is to deliver fully managed trading services to individuals who do not meet the requirements of Qualified Investors and who lack the time to trade for themselves. We recognize fee revenue as our performance obligation is met and we receive payment for such advisory fees in the month following recognition.

 

Revenue generated for the six months ended September 30, 2020 is as follows:

 

    Subscription
Revenue
    Mining Revenue     Fee Revenue     Total  
Gross billings/receipts   $ 10,159,115     $ 3,836,285     $ 7,723     $ 14,003,123  
Refunds, incentives, credits, and chargebacks     (659,970 )     -       -       (659,970 )
Net revenue   $ 9,499,145     $ 3,836,285     $ 7,723     $ 13,343,153  

 

For the six months ended September 30, 2020 foreign and domestic revenues were approximately $9 million and $4.4 million, respectively.

 

F- 11
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

Revenue generated for the six months ended September 30, 2019 is as follows:

 

    Subscription
Revenue
    Mining Revenue     Fee Revenue     Total  
Gross billings/receipts   $ 16,117,861     $ -     $ 5,369     $ 16,123,230  
Refunds, incentives, credits, and chargebacks     (1,369,393 )     -       -       (1,369,393 )
Net revenue   $ 14,748,468     $ -     $ 5,369     $ 14,753,837  

 

For the six months ended September 30, 2019 foreign and domestic revenues were approximately $13.9 million and $800,000, respectively.

 

Revenue generated for the three months ended September 30, 2020 is as follows:

 

    Subscription
Revenue
    Mining Revenue     Fee Revenue     Total  
Gross billings/receipts   $ 5,599,155     $ 2,493,739     $ 3,710     $ 8,096,604  
Refunds, incentives, credits, and chargebacks     (343,267 )     -       -       (343,267 )
Net revenue   $ 5,255,888     $ 2,493,739     $ 3,710     $ 7,753,337  

 

For the three months ended September 30, 2020 foreign and domestic revenues were approximately $7.3 million and $426,000, respectively.

 

Revenue generated for the three months ended September 30, 2019 is as follows:

 

    Subscription
Revenue
    Mining Revenue     Fee Revenue     Total  
Gross billings/receipts   $ 7,825,160     $ -     $ 5,369     $ 7,830,529  
Refunds, incentives, credits, and chargebacks     (588,405 )              -       -       (588,405 )
Net revenue   $ 7,236,755     $ -     $ 5,369     $ 7,242,124  

 

For the three months ended September 30, 2019 foreign and domestic revenues were approximately $6.8 million and $403,000, respectively.

 

Net Income (Loss) per Share

 

We follow ASC subtopic 260-10, Earnings per Share (“ASC 260-10”), which specifies the computation, presentation, and disclosure requirements of earnings per share information. Basic loss per share has been calculated based upon the weighted average number of common shares outstanding. Convertible debt, stock options, and warrants have been excluded as common stock equivalents in the diluted loss per share because their effect is anti-dilutive on the computation.

 

Potentially dilutive securities excluded from the computation of basic and diluted net loss per share are as follows:

 

    September 30,
2020
    September 30,
2019
 
Options to purchase common stock     -       35,000  
Warrants to purchase common stock     233,060       599,800  
Notes convertible into common stock     161,742,478       58,416,067  
Totals     161,975,538       59,050,867  

 

Lease Obligation

 

We determine if an arrangement is a lease at inception. Operating leases are included in the operating lease right-of-use asset account, the operating lease liability, current account, and the operating lease liability, long term account in our balance sheet. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.

 

F- 12
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For leases in which the rate implicit in the lease is not readily determinable, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We have elected to not apply the recognition requirements of ASC 842 to short-term leases (leases with terms of twelve months or less). Lease terms include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for operating lease arrangements is recognized on a straight-line basis over the lease term. We have elected the practical expedient and will not separate non-lease components from lease components and will instead account for each separate lease component and non-lease component associated with the lease components as a single lease component.

 

NOTE 3 – RECENT ACCOUNTING PRONOUNCEMENTS

 

There are no recently issued accounting pronouncements that the Company has not yet adopted that they believe are applicable or would have a material impact on the financial statements of the Company.

 

NOTE 4 – GOING CONCERN AND LIQUIDITY

 

Our financial statements are prepared using generally accepted accounting principles applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. We have incurred significant recurring losses, which have resulted in an accumulated deficit of $52,536,063 as of September 30, 2020, along with a net loss of $6,101,547 for the six months ended September 30, 2020. Additionally, as of September 30, 2020, we had cash of $583,955 and a working capital deficit of $18,383,173. These factors raise substantial doubt about our ability to continue as a going concern.

 

Historically we have relied on increasing revenues and new debt and equity financing to pay for operational expenses and debt as it came due. During the six months ended September 30, 2020, we raised $1,405,300 in cash proceeds from new debt arrangements and raised $4,474,137 in cash proceeds from related parties. Additionally, net cash provided by operations was $661,629 for the six months ended September 30, 2020. Subsequent to September 30, 2020, we received gross proceeds of $93,300 in connection with our Unit Offering (see NOTE 11). Additionally, subject to a Securities Purchase agreement entered into in April 2020 we have a commitment from an investor to purchase a $9 million promissory note on or before October 31, 2020, subject to certain conditions.

 

On January 30, 2020, the World Health Organization declared the coronavirus outbreak a “Public Health Emergency of International Concern” and on March 11, 2020, declared it to be a pandemic. Actions taken around the world to help mitigate the spread of the coronavirus include restrictions on travel, and quarantines in certain areas, and forced closures for certain types of public places and businesses. The coronavirus and actions taken to mitigate the spread of it have had and are expected to continue to have an adverse impact on the economies and financial markets of many countries, including the geographical area in which the Company operates. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was enacted to amongst other provisions, provide emergency assistance for individuals, families and businesses affected by the coronavirus pandemic. It is unknown how long the adverse conditions associated with the coronavirus will last and what the complete financial effect will be to the company. To date, the Company is experiencing challenges in multiple areas of the organization and the full economic impact is yet to be established.

 

During the year ended March 31, 2020 we made significant strides and wide sweeping changes. While we believe they will be beneficial to our bottom line, there is no assurance of this. Some of the concerns we face going forward will continue, including but not limited to:

 

  Supply chain issues for Apex Tek, LLC and the sourcing of miners due to the worldwide COVID pandemic and manufacturing slow downs
     
  SAFETek, LLC operations not scaling according to projections with decreased output due to mining difficulty and operational cost
     
  Regulatory reform that could adversely impact the use and demand of digital currencies
     
  The recent Bitcoin (BTC) halving event that further reduced mining output in addition to the supply chain issues

 

F- 13
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

Apex Tek, LLC and SAFETek, LLC carry additional risk and generated recent losses, however, they also provide Investview a stake in 4IR, HPC, app development, fintech, blockchain and personal money management sectors. Each of these are areas that are targeted for significant growth spurred by innovations through technology which solidify our position in the fintech space.

 

While our liabilities are larger than our assets it is important to note that we seek to further reduce our operating expense. The assets we have acquired and will continue to seek out are those of technology, mobile apps, and human resources. These assets are not easily defined on our balance sheet but represent our ability to carry out our objectives which we believe will ultimately lead to positive cash flow, reduced debt and then profitability.

 

Accordingly, the accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate our continuation as a going concern and the realization of assets and satisfaction of liabilities in the normal course of business. The carrying amounts of assets and liabilities presented in the financial statements do not necessarily purport to represent realizable or settlement values. The financial statements do not include any adjustment that might result from the outcome of this uncertainty.

 

NOTE 5 – RELATED-PARTY TRANSACTIONS

 

Our related-party payables consisted of the following:

 

    September 30,
2020
    March 31,
2020
 
Short-term advances [1]   $ 489,850     $ 876,427  
Promissory note entered into on 1/30/20 [2]     1,133,333       1,033,333  
Convertible Promissory Note entered into on 4/27/20 [3]     77,198       -  
Convertible Promissory Note entered into on 5/27/20 [4]     36,019       -  
Accounts payable – related party [5]     30,000       55,000  
    $ 1,766,400     $ 1,964,760  

 

[1]

We periodically receive advances for operating funds from our current majority shareholders and other related parties, including entities that are owned, controlled, or influenced by our owners or management. These advances are due on demand and are unsecured. During the six months ended September 30, 2020, we received $2,338,137 in cash proceeds from advances, incurred $50,000 in interest expense on the advances, and repaid related parties $2,816,713. Also, during the six months ended September 30, 2020 there was a change in senior management therefore $26,001 due to a former member of the senior management team was reclassified from a related party payable to debt on our balance sheet (see NOTE 6).

   
[2] We entered into a $1,000,000 promissory note with Joeseph Cammarata, our Chief Executive Officer, on January 30, 2020. The term of the note is one year, at which time the principal and interest of 20%, or $200,000 will be due. During the six months ended September 30, 2020 we recognized $100,000 of interest expense on the note.
   
[3] On April 27, 2020 we received proceeds of $1,300,000 from DBR Capital, LLC, an entity controlled by members of our Board of Directors. The note bears interest at 20% per annum, payable monthly, and the principal is due and payable on April 27, 2030. The note is convertible into common stock at a conversion price of $0.01257 per share therefore during the six months ended September 30, 2020 we recorded a beneficial conversion feature and debt discount of $1,300,000 (see NOTE 8). During the six months ended September 30, 2020 we recognized $55,531 of the debt discount into interest expense as well as expensed an additional $111,223 of interest expense on the note, of which $89,556 was repaid during the period.
   
[4] On May 27, 2020 we received proceeds of $700,000 from DBR Capital, LLC, an entity controlled by members of our Board of Directors. The note bears interest at 20% per annum, payable monthly, and the principal is due and payable on April 27, 2030. The note is convertible into common stock at a conversion price of $0.01257 per share therefore during the six months ended September 30, 2020 we recorded a beneficial conversion feature and debt discount of $700,000 (see NOTE 8). During the six months ended September 30, 2020 we recognized $24,352 of the debt discount into interest expense as well as expensed an additional $48,614 of interest expense on the note, of which $36,947 was repaid during the period.
   
[5] During the six months ended September 30, 2020 we paid $25,000 to an accounting firm owned by our Chief Financial Officer to reduce amounts previously owed. We also incurred $68,000 to reimburse DBR Capital, LLC, for amounts paid on our behalf. The entire amount was repaid during the six months ended September 30, 2020.

 

F- 14
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

NOTE 6 – DEBT

 

Our debt consisted of the following:

 

    September 30,
2020
    March 31,
2020
 
Short-term advance received on 8/31/18 [1]   $ 35,000     $ 65,000  
Secured merchant agreement for future receivables entered into on 8/16/19 and refinanced on 12/10/19 [2]     -       1,223,615  
Secured merchant agreement for future receivables entered into on 8/16/19 [3]     -       260,090  
Convertible promissory note entered into on 3/5/20 [4]     -       13,072  
Convertible promissory note entered into on 3/11/20 [5]     -       7,549  
Short-term advance received on 3/25/20 [6]     95,000       150,000  
Promissory note entered into on 4/10/20 [7]     400,000       -  
Note issued under the Paycheck Protection Program on 4/17/20 [8]     507,598       -  
Loan with the U.S. Small Business Administration dated 4/19/20 [9]     508,322       -  
Short-term advance received from a former member of senior management [10]     26,001       -  
    $ 1,571,921     $ 1,719,326  

 

[1] In August 2018, we received a $75,000 short-term advance. The advance is due on demand, has no interest rate, and is unsecured. During the six months ended September 30, 2020 we made repayments of $30,000 on the debt.
   
[2] During August 2019, we entered into a Secured Merchant Agreement for future receivables with an entity that provides quick access to working capital. On August 15, 2019, we received proceeds from this arrangement of $339,270 after paying off $316,093 and $297,033 from two separate February 2018 agreements. In accordance with the terms of the new agreement, we were required to repay $1,399,000 by making daily ACH payments of $6,823. Accordingly, we recorded $446,604 as a debt discount at the inception of the agreement, which was the difference between the funds received plus the earlier debt paid off, and the amount that was to be repaid.
   
  Effective December 10, 2019 this debt was refinanced and the outstanding balance of $839,514 was rolled into a new Secured Merchant Agreement for future receivables. Prior to the refinance, we repaid $559,486 and amortized $446,605 into interest expense related to the August 2019 arrangement. As a result of the refinancing arrangement we received proceeds of $854,801. In accordance with the terms of the agreement, we were required to repay $2,448,250 by making daily ACH payments of $10,999. Accordingly, we recorded $753,935 as a debt discount at the inception of the agreement, which was the difference between the funds received plus the earlier debt paid off, and the amount that was to be repaid. During the year ended March 31, 2020, after the refinance, we repaid $747,932 and amortized $277,232 into interest expense related to the new December 2019 agreement. During the six months ended September 30, 2020 we amortized $442,894 into interest expense and repaid $1,071,996 to pay the debt off in full, which resulted in a gain on settlement of debt being recorded for $594,513.
   
[3] During August 2019, we entered into a Secured Merchant Agreement for future receivables with an entity that provides quick access to working capital. In August 2019, we received proceeds from this arrangement of $418,381 after paying off $382,000 from an October 2018 agreement. In accordance with the terms of the agreement, we were required to repay $1,189,150 by making daily ACH payments of $5,801. Accordingly, we recorded $388,769 as a debt discount at the inception of the agreement, which was the difference between the funds received plus the earlier debt paid off, and the amount that was to be repaid. During the year ended March 31, 2020, we repaid $853,203 and amortized $312,912 into interest expense. During the six months ended September 30, 2020 we repaid $330,013, recorded a $5,934 gain on settlement of debt, and amortized $75,857 into interest expense
   
[4] In March 2020, we entered into a Convertible Promissory Note and received proceeds of $200,000 after incurring loan fees of $3,000. The note incurred interest at 10% per annum and had a maturity date of June 2, 2021. The Convertible Promissory Note had a variable conversion rate that was 65% of the average of the two lowest trading prices during the previous 15-trading-day period, subject to adjustment. Therefore, the conversion feature was accounted for as a derivative instrument (see NOTE 7). At inception, we recorded a debt discount of $203,000 and captured loan fees, recorded as interest expense, of $116,077. During the year ended March 31, 2020, we amortized $11,626 into interest expense, and recorded additional interest expense on the note of $1,446. During the six months ended September 30, 2020, we amortized $59,916 into interest expense, and recorded additional interest expense on the note of $7,453 before we repaid the note in full for $262,649 and wrote off the derivative liability associated with the debt of $265,584 (see NOTE 7), resulting in a net gain on settlement of debt being recorded for $83,376.
   
[5] In March 2020, we entered into a Convertible Promissory Note and received proceeds of $150,000 after incurring loan fees of $3,000. The note incurred interest at 10% per annum and had a maturity date of June 10, 2021. The Convertible Promissory Note had a variable conversion rate that was 65% of the average of the two lowest trading prices during the previous 15-trading-day period, subject to adjustment. Therefore, the conversion feature was accounted for as a derivative instrument (see NOTE 7). At inception, we recorded a debt discount of $153,000 and captured loan fees, recorded as interest expense, of $148,432. During the year ended March 31, 2020, we amortized $6,711 into interest expense, and recorded additional interest expense on the note of $838. During the six months ended September 30, 2020, we amortized $44,960 into interest expense and recorded additional interest expense on the note of $5,617 before we repaid the note in full for $197,351 and wrote off the derivative liability associated with the debt of $203,357 (see NOTE 7), resulting in a net gain on settlement of debt being recorded for $64,132.

 

F- 15
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

[6] In March 2020, we received a $150,000 short-term advance. The advance is due on demand, has no interest rate, and is unsecured. During the six months ended September 30, 2020 we made repayments of $55,000 on the debt.
   
[7] In April 2020, we received proceeds of $400,000 after entering into a promissory note that is due six months from the funding date. Under the note six interest only payments of $16,667 are to be made on the 20th of each month beginning in May 2020. Collateral for the note is, in priority order, is: the reserve and current balance in one of our merchant accounts, the reserve account in a second separate merchant accounts, shares of our common stock, and high-speed computer processing equipment. During the six months ended September 30, 2020 we recorded and paid $83,335 worth of interest expense.
   
[8] In April 2020 we received $505,300 in proceeds from the Paycheck Protection Program as established by the CARES Act as a result of a Note entered into with the U.S. Small Business Administration. The note has an interest rate of 1% and matures on April 1, 2022. Under the Note we are required to make monthly payments beginning November 1, 2020, however, under the terms of the CARES Act the loan may be forgiven if funds are used for qualifying expenses. During the six months ended September 30, 2020 we recorded $2,298 worth of interest expense on the Note.
   
[9] In April 2020 we received proceeds of $500,000 from a loan entered into with the U.S. Small Business Administration. Under the terms of the loan interest is to accrue at a rate of 3.75% per annum and installment payments of $2,437 monthly will begin twelve months from the date of the loan, with all interest and principal due and payable thirty years from the date of the loan. During the six months ended September 30, 2020 we recorded $8,322 worth of interest on the loan.
   
[10] During the six months ended September 30, 2020 there was a change in senior management therefore $26,001 due to a former member of the senior management team was reclassified on our balance sheet from a related party payable to debt (see NOTE 5).

 

NOTE 7 – DERIVATIVE LIABILITY

 

During the six months ended September 30, 2020, we had the following activity in our derivative liability account:

 

    Debt     Warrants     Total  
Derivative liability at March 31, 2020   $ 793,495     $ -     $ 793,495  
Derivative liability recorded on new instruments     -       6,499       6,499  
Derivative liability reduced by debt settlement (see NOTE 6)     (468,941 )     -       (468,941 )
Change in fair value     (324,554 )     (2,234 )     (326,788 )
Derivative liability at September 30, 2020   $ -     $ 4,265     $ 4,265  

 

We use the binomial option pricing model to estimate fair value for those instruments convertible into common stock, at inception, at conversion or settlement date, and at each reporting date. During the six months ended September 30, 2020, the assumptions used in our binomial option pricing model were in the following range:

 

    Debt   Warrants  
Risk free interest rate   0.11 - 0.17%   0.21 - 0.28%  
Expected life in years   0.80 - 1.11   4.84 - 5.00  
Expected volatility   128% - 239%   265% - 306%  

 

NOTE 8 – STOCKHOLDERS’ EQUITY (DEFICIT)

 

Preferred Stock

 

We are authorized to issue up to 50,000,000 shares of preferred stock with a par value of $0.001 and our board of directors has the authority to issue one or more classes of preferred stock with rights senior to those of common stock and to determine the rights, privileges, and preferences of that preferred stock.

 

As of March 31, 2020, we had no preferred stock issued or outstanding.

 

F- 16
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

During the year ended March 31, 2020 our Board of Directors approved the designation of 2,000,000 of the Company’s shares of preferred stock as Series B Cumulative Redeemable Perpetual Preferred Stock (“Series B Preferred Stock”), each with a stated value of $25 per share. Our Series B Preferred Stock holders are entitled to 500 votes per share, are entitled to receive cumulative dividends at the annual rate of 13% per annum of the stated value, equal to $3.25 per annum per share.

 

During the six months ended September 30, 2020 we commenced a security offering to sell a total of 2,000,000 units at $25 per unit (“Unit Offering”), such that each unit consisted of: (i) one share of our newly authorized Series B Preferred Stock and (ii) five warrants each exercisable to purchase one share of common stock at an exercise price of $0.10 per warrant share. Each Warrant offered is immediately exercisable on the date of issuance, will expire 5 years from the date of issuance, and its value has been classified as a fair value liability due to the terms of the instrument (see NOTE 7). During the six months ended September 30, 2020 we sold 46,612 units for gross proceeds of $1,165,300, therefore recorded the issuance of 46,612 shares of Series B Preferred Stock and the grant of 233,060 warrants during the period. Of the gross proceeds, $6,499 was allocated to the warrants and recorded as a derivative liability and $1,158,801 was allocated to the preferred stock ($47 recorded as the par value and $1,158,754 allocated to additional paid in capital). Also in conjunction with the Unit Offering we paid $21,000 of offering costs which was allocated between the preferred stock and warrants. The $20,994 allocated to the preferred stock decreased additional paid in capital due to the underlying instrument being classified as equity and the $6 allocated to the warrants was immediately expensed as offering costs due to the underlying instrument being classified as a fair value liability.

 

Preferred Stock Dividends

 

During the six months ended September 30, 2020 we recorded $52,342 for the cumulative cash dividends due to the shareholders of our Series B Preferred Stock and paid $14,567 of these amounts owing. As a result we recorded $37,775 as a dividend liability on our balance sheet as of September 30, 2020.

 

Common Stock

 

During the six months ended September 30, 2020, we issued 21,000,000 shares of common stock, valued at $399,000 based on the market value on the day of issuance, for services and compensation, which is subject to forfeiture if the employee or contractor is not in good standing at the time the shares are fully vested. Of the $399,000 value we recognized $128,497 as an expense during the six months ending September 30, 2020 and the remaining $270,503 will be recognized ratably over the vesting term. In addition, during the six months ended September 30, 2020, we recognized $666,738 as expense due to the vesting of shares of common stock previously issued.

 

During the six months ended September 30, 2020, we repurchased 9,079 shares of our common stock from a third party for $272 and repurchased 106,000,000 shares of our common stock from former members of our senior management team and founders for $120,000, all of which was recorded in Accounts Payable on our balance sheet at September 30, 2020. These shares repurchased were immediately canceled. Also, during the six months ended September 30, 2020 we recorded an increase in Additional Paid in Capital of $2,000,000 related to beneficial conversion features on our related party debt (see NOTE 5) and recorded an increase in Additional Paid in Capital of $373,832 for accrued payroll forgiven by a member of our senior management team at the time his employment with the Company ended.

 

During the six months ended September 30, 2020 we cancelled 200,000,000 shares returned in conjunction with the termination of a Joint Venture Agreement entered into in March of 2019, reducing common stock by $200,000, reducing additional paid in capital by $3,180,000, offset with a reduction in our prepaid asset of $2,428,044 and a reversal of previously recorded expense of $951,956.

 

As of September 30, 2020, and March 31, 2020, we had 2,929,481,329 and 3,214,490,408 shares of common stock issued and outstanding, respectively.

 

Warrants

 

During the six months ended September 30, 2020 we granted 233,060 warrants in conjunction with our Unit Offering. The warrants are classified as a derivative liability on our balance sheet in accordance with ASC 480, Distinguishing Liabilities from Equity, based on the warrants terms that indicate a fundamental transaction could give rise to an obligation for us to pay cash to our warrant holders (see NOTE 7).

 

F- 17
 

 

INVESTVIEW, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2020

(Unaudited)

 

Details of our warrants outstanding as of September 30, 2020 is as follows:

 

Exercise Price   Warrants Outstanding   Warrants Exercisable   Weighted Average Contractual Life (Years)  
$ 0.10   233,060   233,060   4.79  

 

NOTE 9 – COMMITMENTS AND CONTINGENCIES

 

Litigation

 

In the ordinary course of business, we may be, or have been, involved in legal proceedings from time to time. During the six months ended September 30, 2020 we were not involved in any material legal proceedings.

 

NOTE 10 – OPERATING LEASE