Note
1 - Basis of Presentation
The
accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally
accepted in the United States of America and the rules and regulations of the United States Securities and Exchange Commission
for interim financial information. Accordingly, they do not include all the information and footnotes necessary for a comprehensive
presentation of financial position, results of operations, or cash flows. It is management’s opinion, however, that all
material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement
presentation.
The
unaudited interim consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form
10k, which contains the audited financial statements and notes thereto, together with the Management’s Discussion and Analysis,
for the periods ended December 31, 2012 and 2011. The interim results for the period ended June 30, 2013 are not necessarily indicative
of results for the full fiscal year.
Note
2 - Nature of Operations
Global
Equity Partners, Plc. (“GEP”), a private company, was organized under the laws of the Republic of Seychelles on September
2, 2009. Global Equity International Inc. (the “Company” or “GEI”), a reporting company since June 21,
2012, was organized under the laws of the state of Nevada on October 1, 2010. On November 15, 2010, GEP executed a reverse recapitalization
with GEI.
Revenue
is generated from business consulting services, introduction fees, and equity participation.
Note
3 - Going Concern
As
reflected in the accompanying financial statements, the Company had a loss of $907,425 for the six months ended June 30, 2013.
Net cash used in operations of $(93,309) for the quarter ended June 30, 2013; and a working capital deficit of $(258,409) and
stockholders´ deficit of $1,052,084 as of June 30, 2013. These factors raise substantial doubt about the Company’s
ability to continue as a going concern.
The
ability of the Company to continue its operations is dependent on Management’s plans, which include the raising of capital
through debt and/or equity markets, until such time that funds provided by operations are sufficient to fund working capital requirements.
The Company may need to incur liabilities with certain related parties to sustain the Company’s existence.
The
Company expects to use its working capital to implement a marketing program to increase awareness of its business model, which
includes, but is not limited to, acquisition of private companies, with the intention of taking those companies public in the
United States and possibly dual listing those entities abroad. In the event that operating cash flows are slowed or nonexistent,
the Company plans to reduce its overhead wherever possible.
Depending
upon market conditions, the Company may not be successful in raising sufficient additional capital to achieve its business objectives.
In such event, the business, prospects, financial condition, and results of operations could be materially adversely affected
hence there is certain doubt about the Company’s ability to continue as a going concern.
The
accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization
of assets and the satisfaction of liabilities in the normal course of business. These consolidated financial statements do not
include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be
necessary should the Company be unable to continue as a going concern.
Global
Equity International Inc. and Subsidiary
June
30, 2013
(Unaudited)
Note
4 - Summary of Significant Accounting Policies
Principles
of Consolidation
Global
Equity International Inc. is the parent company of its 100% subsidiary Global Equity Partners Plc. All significant inter-company
accounts and transactions have been eliminated in consolidation.
Use
of Estimates
The
preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and
liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.
Making
estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect
of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered
in formulating its estimate could change in the near term due to one or more future non confirming events. Accordingly, the actual
results could differ from those estimates.
Risks
and Uncertainties
The
Company’s operations are subject to significant risk and uncertainties including financial, operational, competition and
potential risk of business failure. The risk of social and governmental factors is also a concern since the Company is headquartered
in Dubai.
Cash
The
Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. At June
30, 2013 and at December 31, 2012 respectively; the Company had no cash equivalents.
Accounts
Receivable and Allowance for Doubtful Accounts
The
Company recognizes accounts receivable in connection with the services provided. The Company recognizes an allowance for doubtful
accounts based on an analysis of current receivables aging and expected future write-offs, as well as an assessment of specific
identifiable customer accounts considered at risk or uncollectible. At the quarter ended June 30, 2013, the Company had no bad
debt. During the year 2012, the Company recorded $35,000 of bad debt expense pertaining to two invoices the Company deemed were
uncollectible.
Marketable
Securities
(A)
Classification of Securities
At
the time of the acquisition, a security is designated as held-to-maturity, available-for-sale or trading, which depends on the
ability and intent to hold such security to maturity. Securities classified as trading and available-for-sale are reported at
fair value, while securities classified as held-to-maturity are reported at amortized cost. The Company recorded unrealized loss
on marketable securities of $0 and $0 as at June 30, 2013 and December 31, 2012.
Global
Equity International Inc. and Subsidiary
June
30, 2013
(Unaudited)
Cost
Method Investment
At
March 31, 2013, the Company had investment in securities of two different Companies, having a cost of $163,000 that is treated
as a cost method investment. The value of the cost method investment pertains to the receipt of 9.2% of the common stock in a
private company in which the best evidence of value was the services rendered and a further 9.86% of the common stock in another
private company in which the best evidence of value was the services rendered.
At
June 30, 2013, there were identifiable events or changes in circumstances that had a significant adverse effect on the value of
one of the investments hence the Company decided to impair $160,000 of the investments.
Also
at June 30, 2013, the Company received 2,000,000 shares from a private company and client having a cost of $2,000 that is treated
as a cost method investment. The value of the cost method investment pertains to the receipt of 8.55% of the common stock in a
private company in which the best evidence of value was the services rendered
Equity
investment in companies is accounted for under the cost method as the equity investments do not have readily determinable fair
values. As per ASC codification 320 “Certain Investments in Debt and Equity Securities”, non-marketable equity securities
that do not have a readily determinable fair value are not required to be accounted for under the equity method and are typically
carried at cost.
(B)
Other than Temporary Impairment
The
Company reviews its equity investment portfolio for any unrealized losses that would be deemed other-than-temporary and require
the recognition of an impairment loss in income. If the cost of an investment exceeds its fair value, the Company evaluates, among
other factors, general market conditions, the duration and extent to which the fair value is less than cost, and the Company’s
intent and ability to hold the investments. Management also considers the type of security, related-industry and sector performance,
as well as published investment ratings and analyst reports, to evaluate its portfolio. Once a decline in fair value is determined
to be other than temporary, an impairment charge is recorded and a new cost basis in the investment is established. If market,
industry, and/or investee conditions deteriorate, the Company may incur future impairments. The Company did record a permanent
impairment of one of its investments during the quarter ended June 30, 2013; no impairments were carried out during the quarter
ended June 30, 2012.
Beneficial
Conversion Feature
For
conventional convertible debt where the rate of conversion is below market value, the Company records a “beneficial conversion
feature” (“BCF”) and related debt discount.
When
the Company records a BCF, the relative fair value of the BCF would be recorded as a debt discount against the face amount of
the respective debt instrument. The discount would be amortized to interest expense over the life of the debt.
Debt
issue costs and debt discount
The
Company may pay debt issue costs, and record debt discounts in connection with raising funds through the issuance of convertible
debt. These costs are amortized over the life of the debt to interest expense. If a conversion of the underlying debt occurs,
a proportionate share of the unamortized amounts is immediately expensed.
Global
Equity International Inc. and Subsidiary
June
30, 2013
(Unaudited)
Original
issue discount
For
certain convertible debt issued, the Company provides the debt holder with an original issue discount. The original issue discount
is recorded to debt discount, reducing the face amount of the note and is amortized to interest expense over the life of the debt.
Fixed
Assets
Fixed
Assets are to be stated at cost of acquisition less accumulated depreciation. Depreciation is provided based on estimated useful
lives of the assets. Cost of improvements that substantially extend the useful lives of assets can be capitalized. Repairs and
maintenance expenses are to be charged to expense when incurred. In case of sale or disposal of an asset, the cost and related
accumulated depreciation are removed from the consolidated financial statement.
|
|
|
June
30, 2013
|
|
|
December 31, 2012
|
|
|
Office
equipment
|
|
$
|
6,579
|
|
|
$
|
6,579
|
|
|
Accumulated
depreciation
|
|
$
|
(779
|
)
|
|
$
|
(117
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net
fixed assets
|
|
$
|
5,800
|
|
|
$
|
6,462
|
|
During
the three and six months ended June 30, 2013, the Company has expensed $333 and $662 and $0 and $0 during the comparative period
June 30, 2012, respectively for depreciation.
Revenue
Recognition
We
recognize revenue when all of the following conditions are satisfied: (1) there is persuasive evidence of an arrangement; (2)
the product or service has been provided to the customer; (3) the amount of fees to be paid by the customer is fixed or determinable;
and (4) the collection of our fees is probable.
The
Company’s services do not include a provision for cancellation, termination, or refunds.
For
the quarters ended June 30, 2013 and June 30, 2012 the Company received marketable securities and cash as consideration for services
rendered.
At
June 30, 2013 and December 31, 2012, the Company had the following concentrations of accounts receivables with customers:
|
Customer
|
|
June
30, 2013
|
|
|
December
31, 2012
|
|
|
C
|
|
|
-
|
%
|
|
|
-
|
%
|
|
I
|
|
|
-
|
%
|
|
|
99
|
%
|
For
the six months ended June 30, 2013 and 2012, the Company had the following concentrations of revenues with customers:
|
Customer
|
|
June
30, 2013
|
|
|
June
30, 2012
|
|
|
|
C
|
|
|
100
|
%
|
|
|
11
|
%
|
|
|
E
|
|
|
-
|
%
|
|
|
5
|
%
|
|
|
F
|
|
|
-
|
%
|
|
|
15
|
%
|
(*)
|
|
G
|
|
|
-
|
%
|
|
|
31
|
%
|
|
|
H
|
|
|
-
|
%
|
|
|
38
|
%
|
|
The
Company received from customer “C” 56.20% of its revenue in cash and 43.80% in Non-marketable securities.
_____________
|
*
|
|
Non-marketable
securities,
accounted
for
under
the
cost
method.
|
Global
Equity International Inc. and Subsidiary
June
30, 2013
(Unaudited)
During
the six months ended June 30, 2013, the Company received $3,000 in equity securities in a private company in exchange for services
performed. The valuation was based on 3,000,000 shares at $0.001 per share. The company also received $2,000 in equity securities
in another private company in exchange for services to be performed. The valuation was based on 2,000,000 shares at $0.001 per
share.
The
company currently holds the following equity securities in private and also reporting companies:
|
Company
|
|
No.
Shares
|
|
|
Status
|
|
|
|
|
|
|
|
|
M1
Lux AG
|
|
|
2,000,000
|
|
|
Private
Company
|
|
Monkey
Rock Group Inc.
|
|
|
1,500,000
|
|
|
Reporting
Company – OTC
|
|
Voz
Mobile Cloud Limited
|
|
|
3,200,000
|
|
|
Private
Company
|
|
Arrow
Cars International Inc.
|
|
|
3,000,000
|
|
|
Reporting
Company – OTC
|
|
Direct
Security Integration Inc.
|
|
|
2,000,000
|
|
|
Private
Company
|
|
|
|
|
|
|
|
|
|
|
|
|
11,700,000
|
|
|
|
Deferred
Revenue
Deferred
revenue represents fees that have been received by the Company for requested services that have not been substantially completed.
During the six months ended June 30, 2013 the Company received $122,000 from a client for service to be rendered during the year
2013.
Share-based
payments
The
Company recognizes all forms of share-based payments, including stock option grants, warrants and restricted stock grants at their
fair value on the grant date, which is based on the estimated number of awards that are ultimately expected to vest.
Share
based payments, excluding restricted stock, are valued using a Black-Scholes pricing model.
Share
based payment awards issued to non-employees for services rendered are recorded at either the fair value of the services rendered
or the fair value of the share-based payment, whichever is more readily determinable.
The
grants are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period
.
Global
Equity International Inc. and Subsidiary
June
30, 2013
(Unaudited)
When
computing fair value, the Company considered the following variables:
|
|
●
|
The
risk-free interest rate assumption is based on the U.S. Treasury yield for a period consistent with the expected term of the
share based payment in effect at the time of the grant.
|
|
|
|
|
|
|
●
|
The
expected term was developed by management estimate.
|
|
|
|
|
|
|
●
|
The
Company has not paid any dividends on common stock since inception and does not anticipate paying dividends on its common
stock in the near future.
|
|
|
|
|
|
|
●
|
The
expected volatility is based on management estimates regarding private company stock, where future trading of stock in a public
market is expected to be highly volatile.
|
|
|
|
|
|
|
●
|
The
forfeiture rate is based on historical experience.
|
Income
Taxes
Income
taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for the
future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities
and their respective tax bases, and operating loss carry-forwards. Deferred income tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered
or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period
that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred income tax assets
if it is considered more likely than not that some portion, or all, of the deferred income tax assets will not be realized.
Earnings
per Share
Basic
earnings (loss) per share are computed by dividing net income (loss) by weighted average number of shares of common stock outstanding
during each period. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number
of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period.
The
Company has no common stock equivalents, which, if exercisable, would be dilutive. A separate computation of diluted earnings
(loss) per share is not presented.
Fair
Value of Financial Assets and Liabilities
The
carrying amounts reflected in the balance sheets for cash, accounts payable and accrued expenses approximate the respective fair
values due to the short maturities of these items. The Company does not hold any investments that are available-for-sale.
As
required by the Fair Value Measurements and Disclosures Topic of the FASB ASC, fair value is measured based on a three-tier fair
value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted
prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly
or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity
to develop its own assumptions.
The
three levels of the fair value hierarchy are described below:
Level
1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or
liabilities;
Level
2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially
the full term of the asset or liability;
Level
3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable
(supported by little or no market activity).
Global
Equity International Inc. and Subsidiary
June
30, 2013
(Unaudited)
Loans
to Third Parties
On
March 22, 2013 the Company granted a loan to Dreamscapes Properties International Inc. The principal amount lent was $6,000, the
agreed interest rate was 5% per annum and finally, the loan would have to be repaid no later than one year from the date that
the loan was granted.
Recent
Accounting Pronouncements
There
are no new accounting pronouncements that have any impact on the Company’s financial statements.
Note
5 - Debt
(A)
Related Party – short term
The
Company received loans from related parties. The loans are non-interest bearing, unsecured and due on demand. The following table
represents the loans payable activity as of June 30, 2013 and as of December 31, 2012 respectively:
|
Loans
payable – related party – December 31, 2012
|
|
$
|
48,075
|
|
|
|
|
|
|
|
|
Proceeds
from loans
|
|
|
4,819
|
|
|
Repayments
|
|
|
-
|
|
|
|
|
|
|
|
|
Loans
payable – related party – June 30, 2013
|
|
$
|
52,894
|
|
(B)
Related party – long term
The
Company has accrued salary to the officers and directors of the Company based on the terms of the employment agreements entered
into with each officer. As at December 31, 2012, $209,475 was due to the Chief Executive Officer and $115,000 was due to the Chief
Financial Officer. During the quarter ended March 31, 2013, the Company converted this amount to Convertible Loan Payable. This
amount will be advanced for a term of two years and is repayable on demand and will accrue interest at 10% on the loan period.
The agreement also gives an option to the officers of the Company to convert all or part of the debt that the Company maintains
with them into restricted shares at $1.20 per share. The balance outstanding in the Loan Payable account as at June 30, 2013 is
$324,475. The Company assessed if there is a beneficial conversion feature cost associated with this transaction, none was noted.
(C)
Notes payable
In
February and March 2012, the Company entered into two 90 day bridge loan agreements to raise a total of $70,000; $20,000 from
“note holder A” and $50,000 from “note holder B”. The loans had interest rates ranging from 0% - 3%. The
loans were unsecured.
In
connection with these loans, the Company issued 140,000 shares of common stock, having a fair value of $70,000 ($0.50/share),
based upon recent third party services rendered at that time, and 20,000 options to one lender having an exercise price of $1,
expiring September 2013. The fair value of the options was $6,968.
Global
Equity International Inc. and Subsidiary
June
30, 2013
(Unaudited)
The
140,000 shares of common stock issued in connection with the bridge loans were treated as a debt discount of $70,000. The remaining
valuation of the options, $6,968, was recorded as interest expense.
The
Company applied fair value accounting for the options issued to the lender. The fair value of the options granted was estimated
on the date of grant using the Black-Scholes pricing model. (Please refer to note 6 C Stock Options)
On
June 25, 2012, $30,000 was repaid to “note holder B” and the remaining $10,000 was converted into 40,000 shares of
common stock ($0.25/share) in September of 2012, thereby leaving an outstanding balance as of December 31, 2012 of $10,000. There
was no gain or loss on conversion. During the quarter ended March 31, 2013 the Company repaid the balance of $10,000.
On
July 5, 2012, “note holder A”, $20,000 was converted into 40,000 shares of common stock ($0.50/share). There was no
gain or loss on conversion.
On
November 16, 2012, the Company issued 2,000 common restricted shares ($0.25/share) to “note holder A” in lieu of $500
interest due. The balance outstanding for the interest payment of $500 is outstanding as at June 30, 2013.
On
April 23, 2013, the Company secured a nine month convertible loan for $42,500 with an 8% interest rate due on January 29, 2014.
The terms of the conversion will be a 42% discount to market based on an average price calculated on the 10 trading days prior
to the conversion date. If the Company opts to pay the loan back on or before the 9 month period ends, hence not converting the
debt into equity; borrower shall make payment to the holder of an amount in cash (the “Optional Prepayment Amount”)
equal to 130% of total amount due inclusive of principal and interest accrued.
On
June 4, 2013, the Company secured a twelve month convertible loan for $50,000 with the understanding that the Company will issue
10,000 common restricted shares in lieu of interest, these shares are not issued as of June 30, 2013 and accounted for as Stock
Payable. The terms of the conversion will be either a $0.50 conversion price or a 25% discount to market based on an average price
calculated on the 10 trading days prior to the conversion date, whichever is the lowest.
The
amounts paid to acquire the debt financing have been treated as a debt discount hence at June 30, 2013, the Company recorded debt
discounts of $47,370. This will be amortized over the life of the respective loans.
During
the six months ended June 30, 2013 and December 31, 2012, the Company amortized $8,212 and $67,556.
(D)
Accounts payable – related parties
The
following table represents the accounts payable to related parties as of June 30, 2013 and December 31, 2012, respectively:
|
|
|
06/30/2013
|
|
|
12/31/2012
|
|
|
|
|
|
|
|
|
|
|
Salaries
|
|
|
138,500
|
|
|
|
414,034
|
|
|
Expenses
|
|
|
25,935
|
|
|
|
7,466
|
|
|
|
|
$
|
164,435
|
|
|
$
|
421,500
|
|
As
discussed in note no. 5(B), the Company converted $324,475 of related party accounts payable into a convertible loan payable during
the six months ended June 30, 2013.
Global
Equity International Inc. and Subsidiary
June
30, 2013
(Unaudited)
Note
6 - Temporary Equity and Stockholders’ Equity
(A)
Preferred Stock
On
November 30, 2011, the Company authorized and designated 5,000,000 Series “A” convertible preferred shares of stock,
as a bonus to its Chief Executive Officer for services rendered, having a fair value of $480,000 ($0.096/share), based upon the
fair value of the services rendered, which represented the best evidence of fair value.
On
November 13, 2012, the Company’s board of directors approved an amendment to the Certificate of Designation; to amend the
voting rights and conversion rights of the Company’s Series “A” preferred shares as follows:
|
|
●
|
Voting
Rights: 10 votes per share (votes along with common stock);
|
|
|
●
|
Conversion
Rights: Each share of Series “A” Preferred is convertible into ten (10) shares of common stock 1 day after the
second anniversary of issuance;
|
|
|
●
|
Dividend
Rights: None;
|
|
|
●
|
Liquidation
Rights: None
|
The
board of directors subsequently agreed that the Chief Executive Officer of the Company would retire to treasury 3,466,668 of these
Series “A” preferred shares and retain, the balance, 1,533,332 shares.
On
November 21, 2012 the Company’s CEO gave 533,332 of his Series “A” preferred shares to the Company’s CFO
(400,000) and two other employees (133,332). As the 533,332 preferred shares will convert into 5,333,320 on December 1, 2014 and
the price per common share on November 21, 2012 was $0.25, the contribution by the officer to the Company was calculated at $1,333,330.
The
Company has determined that no beneficial conversion feature or derivative financial instruments exist in connection with the
Series “A”, convertible preferred stock, as the conversion rate was fixed at an amount equal to the market price of
the Company’s common stock. Additionally, there are a stated number of fixed shares.
Redeemable
Preferred Stock
Under
Regulation S-X, Rule 5-02-28, preferred stock must be classified outside of stockholders’ equity when the stock is:
|
●
|
|
Redeemable
at a fixed or determinable price on a fixed or determinable date,
|
|
●
|
|
Redeemable
at the option of the holder, or
|
|
●
|
|
Redeemable
based on conditions outside the control of the issuer.
|
The
Series “A”, convertible preferred stock is redeemable on December 1, 2014 and it is presented on the balance sheets
as “Redeemable Preferred Stock” in a manner consistent with temporary equity. There are no other features associated
with this class of redeemable preferred stock, which require disclosure. The carrying amount and redemption amount is $480,000.
There are no redemption requirements.
Global
Equity International Inc. and Subsidiary
June
30, 2013
(Unaudited)
(B)
Common Stock
During
the six months ended June 30, 2013, the Company issued the following shares:
|
Date
|
|
Type
|
|
Shares
|
|
|
Valuation
|
|
|
Range
of
value
per
share
|
|
|
2/15/2013
|
|
Stock
issued for services
|
|
|
100,000
|
|
|
$
|
80,000
|
|
|
$
|
0.80
|
|
|
3/12/2013
|
|
Stock
issued for services
|
|
|
75,000
|
|
|
$
|
82,500
|
|
|
$
|
1.10
|
|
|
4/5/2013
|
|
Stock
issued for services
|
|
|
150,000
|
|
|
$
|
142,500
|
|
|
$
|
0.95
|
|
|
4/5/2013
|
|
Stock
issued for services
|
|
|
500,000
|
|
|
$
|
125,000
|
|
|
$
|
0.25
|
|
|
4/15/2013
|
|
Stock
issued for services
|
|
|
25,000
|
|
|
$
|
13,750
|
|
|
$
|
0.55
|
|
|
4/24/2013
|
|
Stock
issued for services
|
|
|
150,000
|
|
|
$
|
43,500
|
|
|
$
|
0.29
|
|
|
5/3/2013
|
|
Stock
issued for cash
|
|
|
16,667
|
|
|
$
|
10,000
|
|
|
$
|
0.60
|
|
|
5/17/2013
|
|
Stock
issued for services
|
|
|
40,000
|
|
|
$
|
6,800
|
|
|
$
|
0.17
|
|
|
5/17/2013
|
|
Stock
issued for services
|
|
|
99,835
|
|
|
$
|
16,972
|
|
|
$
|
0.17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals
|
|
|
1,156,502
|
|
|
$
|
521,022
|
|
|
|
|
|
(C)
Stock options
The
following is a summary of the Company’s options activity:
|
|
|
Number
of options
|
|
|
Weighted
Average Exercise Price
|
|
|
Balance
at December 31, 2012
|
|
|
20,000
|
|
|
$
|
1.00
|
|
|
|
|
|
|
|
|
|
|
|
|
-
Granted
|
|
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
-
Exercised
|
|
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
-
Forfeited
|
|
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
at June 30, 2013
|
|
|
20,000
|
|
|
$
|
1.00
|
|
The
weighted average remaining life for all outstanding options at June 30, 2013 is 0.25 years. The fair value of each option granted
is estimated on the date of grant using the Black-Scholes pricing model.
The
Black Scholes assumptions used are as follows:
|
Exercise
price
|
|
$
|
1.00
|
|
|
Expected
dividends
|
|
|
0
|
%
|
|
Expected
volatility
|
|
|
182
|
%
|
|
Risk
fee interest rate
|
|
|
0.3
|
%
|
|
Expected
life
|
|
|
1.5
years
|
|
|
Expected
forfeitures
|
|
|
0
|
%
|
Global
Equity International Inc. and Subsidiary
June
30, 2013
(Unaudited)
(D)
Stock payable
On
October 8, 2012 the Company entered into a commission agreement with a company called Tempest Holdings Limited where Tempest would
receive a finder’s fee for the introduction of new business and also a retainer fee of 10,000 common restricted shares per
month for twelve months commencing January 1, 2013. The Company has valued the 60,000 shares due to Tempest using fair market
value at $39,700.
On
April 24, 2013, the Company entered into a consulting agreement with Robert Sullivan. As per the agreement the Company will be
issuing 150,000 restricted shares to the consultant. The agreement also stipulates a condition where the Company guarantees a
minimal value of $100,000 at the time of legend removal and any shortfall will be taken care of by issuance of additional shares.
As of the date of the agreement the shares are valued at $43,500, hence the difference of $56,500 is recorded as stock payable.
On
June 4, 2013, the Company received $50,000 from Direct Securities Integration, Inc in pursuance of a notes payable agreement.
The agreement stipulates a condition for the payment of 10,000 shares in lieu of interest on the day of agreement. Such shares
are not issued as of June 30, 2013, and are valued at $5,500.
Note
8 – Commitments and contingencies
On
April 24, 2013, the Company entered into advertisement contract with Robert Sullivan. The Company is required to pay $30,000 in
cash and issue 150,000 shares. During the current period the Company has paid $10,000 in cash, the balance of $20,000 is due within
60 days of the signing of the agreement;this amount is unpaid as at June 30, 2013. The Company has guaranteed a value of $100,000
for its shares at the time of legend removal. At June 30, 2013 the legend is still not removed, the Company has accrued for the
short fall of $56,500 as a stock payable.
Note
9 – Subsequent Events
On
July 1, 2013 the Company was engaged by a UK private company called Scandinavian Agritex Co. Limited. The nature of this engagement
was to assist this company with a Dubai NASDAQ full IPO. In consideration of the Company providing services, Scandinavian will
pay $400,000 as fees.
On
July 9, 2013 the Company was engaged by another UK private company called Arabian Nubian Resources Limited (ANR). The nature of
this engagement was to assist this company with sourcing a Dubai DFSA approved sponsor for a subsequent Dubai NASDAQ listing.
ANR shall pay Company a non refundable sum of $25,000 upon signing of the engagement.