UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
10-Q
[X]
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the quarterly period ended September 30, 2014
or
[
] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR
THE TRANSITION FROM ______ TO ______.
Commission
File Number: 000-54557
GLOBAL
EQUITY INTERNATIONAL INC.
(Exact
name of registrant as specified in its charter)
Nevada |
|
27-3986073 |
(State
or other Jurisdiction of
Incorporation or Organization) |
|
(I.R.S.
Employer
Identification No.) |
|
|
|
X3
Jumeirah Bay, Office 3305,
Jumeirah
Lake Towers, Dubai, UAE |
|
|
(Address
of principal executive offices) |
|
(Zip
code) |
Registrant’s
telephone number: +971 (0) 42767576
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate
by check mark whether the registrant has submitted electronically and posted on its Website, if any, every Interactive Data File
required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Sec.232.405 of this chapter) during the preceding
12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [ ]
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.
Large
accelerated filer [ ] |
Accelerated
filer [ ] |
Non-accelerated
filer [ ] |
Smaller
reporting company [X] |
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No
[X]
APPLICABLE
ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS
Indicate
by check mark whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange
Act after the distribution of securities under a plan confirmed by a court. Yes [ ] No [ ]
APPLICABLE
ONLY TO CORPORATE ISSUERS
State
the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: As
of November 11, 2014, there were 33,751,752 outstanding shares of the Registrant’s Common Stock, $.001 par value.
INDEX
PART
I – FINANCIAL INFORMATION
Item
1. Financial Statements.
Global
Equity International, Inc. and Subsidiary
Consolidated
Financial Statements
September
30, 2014
(Unaudited)
CONTENTS
Global
Equity International, Inc. and Subsidiary
Consolidated
Balance Sheets
For
the interim period ended September 30, 2014 (Unaudited) and the year ended December 31, 2013 (Audited)
| |
September 30, 2014 | | |
December 31, 2013 | |
| |
| Unaudited | | |
| Audited | |
| |
| | | |
| | |
Assets | |
| | | |
| | |
| |
| | | |
| | |
Current Assets | |
| | | |
| | |
Cash | |
$ | 17,152 | | |
$ | 48,856 | |
Accounts receivable | |
| 2,520 | | |
| 2,520 | |
Prepaids | |
| 62,429 | | |
| 33,799 | |
Other current assets | |
| 452,201 | | |
| 452,201 | |
Loans receivable | |
| 6,000 | | |
| 6,000 | |
Total current assets | |
| 540,302 | | |
| 543,376 | |
| |
| | | |
| | |
Investment, cost | |
| 5,000 | | |
| 5,000 | |
| |
| | | |
| | |
Fixed assets, net | |
| 22,404 | | |
| 7,817 | |
Total assets | |
$ | 567,706 | | |
$ | 556,193 | |
| |
| | | |
| | |
Liabilities, Redeemable Preferred Stock and Stockholders’ Deficit | |
| | | |
| | |
| |
| | | |
| | |
Current Liabilities | |
| | | |
| | |
Deferred revenue | |
$ | 250,000 | | |
$ | 247,000 | |
Accounts payable and accrued liabilities | |
| 72,324 | | |
| 38,989 | |
Accounts payable - related parties | |
| 331,985 | | |
| 192,053 | |
Loans payable - related party | |
| 57,894 | | |
| 57,194 | |
Accrued interest | |
| 378,979 | | |
| 120,918 | |
Notes payable - net of unamortized discount | |
| 1,128,951 | | |
| 996,531 | |
Total current liabilities | |
| 2,220,133 | | |
| 1,652,685 | |
| |
| | | |
| | |
Long term liabilities | |
| | | |
| | |
Convertible loan payable - related party | |
| 324,475 | | |
| 324,475 | |
Total long term liabilities | |
| 324,475 | | |
| 324,475 | |
| |
| | | |
| | |
Redeemable Series A, Convertible Preferred Stock: 5,000,000 shares authorized
and 1,983,332 and 5,000,000 shares issued and outstanding, respectively, $0.001 par value (redemption amount $480,000) (liquidation
preference of $0) | |
| 1,020,000 | | |
| 1,020,000 | |
| |
| | | |
| | |
Stockholders’ Deficit | |
| | | |
| | |
| |
| | | |
| | |
Common stock: 70,000,000 shares authorized; $0.001 par value 33,159,418 and 31,044,202 shares
issued and outstanding, respectively. | |
| 33,160 | | |
| 31,045 | |
Additional paid in capital | |
| 2,963,638 | | |
| 2,657,659 | |
Stock payable | |
| 82,850 | | |
| 82,850 | |
Accumulated deficit | |
| (6,076,550 | ) | |
| (5,212,521 | ) |
Total stockholders’ deficit | |
| (2,996,902 | ) | |
| (2,440,967 | ) |
| |
| | | |
| | |
Total liabilities, redeemable preferred stock &
stockholders’ deficit | |
$ | 567,706 | | |
$ | 556,193 | |
The
accompanying notes are an integral part of these consolidated financial statements.
Global
Equity International, Inc. and Subsidiary
Consolidated
Statements of Operations and Comprehensive Loss
For
the three and nine months period ended September 30, 2014 and September 30, 2013 (Unaudited)
| |
Three Months | | |
Three Months | | |
Nine Months | | |
Nine Months | |
| |
September 30, 2014 | | |
September 30, 2013 | | |
September 30, 2014 | | |
September 30, 2013 | |
| |
| | |
| | |
| | |
| |
Revenue | |
$ | 209,000 | | |
$ | 165,000 | | |
$ | 555,000 | | |
$ | 171,849 | |
| |
| | | |
| | | |
| | | |
| | |
General and administrative expenses | |
| 130,263 | | |
| 99,240 | | |
| 226,463 | | |
| 222,634 | |
Salaries | |
| 251,657 | | |
| 150,000 | | |
| 639,375 | | |
| 390,000 | |
Professional services | |
| 111,215 | | |
| 116,772 | | |
| 211,648 | | |
| 511,042 | |
Depreciation | |
| 653 | | |
| 336 | | |
| 1,630 | | |
| 998 | |
Impairment of financial assets | |
| - | | |
| - | | |
| - | | |
| 160,000 | |
Total operating expenses | |
| 493,788 | | |
| 366,348 | | |
| 1,079,115 | | |
| 1,284,674 | |
| |
| | | |
| | | |
| | | |
| | |
Net loss from operations | |
| (284,788 | ) | |
| (201,348 | ) | |
| (524,115 | ) | |
| (1,112,825 | ) |
| |
| | | |
| | | |
| | | |
| | |
Other income (expenses): | |
| | | |
| | | |
| | | |
| | |
Interest (expense) | |
| (70,782 | ) | |
| (23,555 | ) | |
| (329,432 | ) | |
| (24,491 | ) |
Amortization of debt discount | |
| (709 | ) | |
| (18,240 | ) | |
| (26,567 | ) | |
| (26,452 | ) |
Gain on settlement of debt | |
| - | | |
| - | | |
| 16,560 | | |
| 13,200 | |
Exchange rate gain / (loss) | |
| (323 | ) | |
| - | | |
| (476 | ) | |
| - | |
Total income (expenses) | |
| (71,814 | ) | |
| (41,795 | ) | |
| (339,915 | ) | |
| (37,743 | ) |
| |
| | | |
| | | |
| | | |
| | |
Net loss | |
$ | (356,602 | ) | |
$ | (243,143 | ) | |
$ | (864,030 | ) | |
$ | (1,150,568 | ) |
| |
| | | |
| | | |
| | | |
| | |
Weighted average number of common shares outstanding - basic | |
| 32,474,668 | | |
| 30,784,202 | | |
| 31,866,476 | | |
| 30,370,730 | |
| |
| | | |
| | | |
| | | |
| | |
Net loss per common share - basic | |
$ | (0.01 | ) | |
$ | (0.01 | ) | |
$ | (0.01 | ) | |
$ | (0.04 | ) |
| |
| | | |
| | | |
| | | |
| | |
Comprehensive Loss: | |
| | | |
| | | |
| | | |
| | |
Net loss | |
| (356,602 | ) | |
| (243,143 | ) | |
| (864,030 | ) | |
| (1,150,568 | ) |
Comprehensive Loss | |
$ | (356,602 | ) | |
$ | (243,143 | ) | |
$ | (864,030 | ) | |
$ | (1,150,568 | ) |
The
accompanying notes are an integral part of these consolidated financial statements.
Global
Equity International Inc. And Subsidiary
Consolidated
Statements of Cash Flows
For
the nine months period ended September 30, 2014 and September 30, 2013 (Unaudited)
| |
September 30, 2014 | | |
September 30, 2013 | |
| |
| | |
| |
Cash flows from operating activities | |
| | | |
| | |
Net loss | |
$ | (864,030 | ) | |
$ | (1,150,568 | ) |
| |
| | | |
| | |
Adjustments to reconcile net loss to net cash used in operating activities | |
| | | |
| | |
| |
| | | |
| | |
Gain on settlement of debt | |
| (16,560 | ) | |
| (13,200 | ) |
Consulting revenues received in marketable securities | |
| - | | |
| (3,000 | ) |
Depreciation | |
| 1,630 | | |
| 998 | |
Common stock issued for services rendered | |
| 186,275 | | |
| 459,748 | |
Common stock issued in lieu of notes payable | |
| - | | |
| - | |
Amortization of debt discount | |
| 26,567 | | |
| 26,452 | |
Impairment of financial assets | |
| - | | |
| 160,000 | |
Stock issued for interest | |
| 65,785 | | |
| - | |
| |
| | | |
| | |
Changes in operating assets and liabilities: | |
| | | |
| | |
Prepaids, cash | |
| (28,630 | ) | |
| (2,690 | ) |
Accrued interest | |
| 262,448 | | |
| 17,724 | |
Accounts payable and accrued liabilities | |
| 49,896 | | |
| 36,214 | |
Accounts payable - related parties | |
| 139,932 | | |
| 134,477 | |
Deferred revenue | |
| 3,000 | | |
| 60,000 | |
Accounts receivable | |
| - | | |
| 145,000 | |
Impairment of financial assets | |
| - | | |
| - | |
| |
| | | |
| | |
Net cash used in operating activities: | |
| (173,688 | ) | |
| (128,845 | ) |
| |
| | | |
| | |
Cash Flows used in investing activities: | |
| | | |
| | |
Office furniture and equipment, net | |
| (16,216 | ) | |
| - | |
Loans given to non-affiliate | |
| - | | |
| (6,000 | ) |
| |
| | | |
| | |
Net cash used in investing activities | |
| (16,216 | ) | |
| (6,000 | ) |
| |
| | | |
| | |
Cash flows from financing activities: | |
| | | |
| | |
Proceeds from loans - related parties | |
| 700 | | |
| 4,819 | |
Convertible loan payable | |
| 208,000 | | |
| 125,000 | |
Repayment of notes payable | |
| (50,500 | ) | |
| (9,500 | ) |
Proceeds from issuance of common stock | |
| - | | |
| 10,000 | |
| |
| | | |
| | |
Net cash provided by financing activities | |
| 158,200 | | |
| 130,319 | |
| |
| | | |
| | |
Net increase in cash | |
| (31,704 | ) | |
| (4,526 | ) |
| |
| | | |
| | |
Effect of Exchange Rates on Cash | |
| - | | |
| - | |
| |
| | | |
| | |
Cash at Beginning of Period | |
| 48,856 | | |
| 4,852 | |
| |
| | | |
| | |
Cash at End of Period | |
$ | 17,152 | | |
$ | 326 | |
| |
| | | |
| | |
Supplemental disclosure of cash flow information: | |
| | | |
| | |
Cash paid for interest | |
$ | - | | |
$ | - | |
| |
| | | |
| | |
Cash paid for income taxes | |
$ | - | | |
$ | - | |
| |
| | | |
| | |
Supplemental disclosure of non-cash investing and financing activities: | |
| | | |
| | |
| |
| | | |
| | |
Accounts payable settled in shares | |
$ | 186,275 | | |
$ | 75,000 | |
Prepaid expenses paid in stock | |
$ | - | | |
$ | 104,522 | |
Debt discount recorded on notes payable | |
$ | 93,446 | | |
$ | 47,370 | |
Deferred revenue settled in shares | |
$ | | | |
$ | 2,000 | |
Conversion of balance in accounts payable - related party to loans payable | |
$ | - | | |
$ | 324,475 | |
Notes payable settled in shares | |
$ | 121,819 | | |
$ | - | |
The
accompanying notes are an integral part of these consolidated financial statements.
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(Unaudited)
Notes
to financial statements:
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, 2013 and 2012. The interim results for the period ended September 30, 2014 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. On August 22, 2014 we formed a Dubai subsidiary, of Global Equity Partners Plc., called GE Professionals JLT.
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 net comprehensive loss of $356,602 and $864,030 for the
three and nine months ended September 30, 2014 respectively. Net cash used in operations of $173,688 for the nine months ended
September 30, 2014; and a working capital deficit of $1,679,831 and stockholders´ deficit of $2,996,902 as of September
30, 2014. 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.
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(Unaudited)
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.
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. and GE Professionals JLT is
100% owned by 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 September
30, 2014 and at December 31, 2013 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 September 30, 2014, the Company had no
bad debt.
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 September 30, 2014 and December 31, 2013.
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(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 impaired $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 not carry out any
impairments during the quarter ended September 30, 2014.
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
September
30, 2014
(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.
| |
September 30, 2014 | | |
September 30, 2013 | |
Office equipment | |
$ | 25,532 | | |
$ | 6,679 | |
Accumulated depreciation | |
$ | (3,128 | ) | |
$ | (1,115 | ) |
Net fixed assets | |
$ | 22,404 | | |
$ | 5,464 | |
During
the nine months ended September 30, 2014 and September 30, 2013, the Company expensed $1,630 and $998 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 nine months ended September 30, 2014 and September 30, 2013 the Company received cash only as consideration for services rendered.
At
September 30, 2014 and September 30, 2013, the Company had the following concentrations of accounts receivables with customers:
Customer | | |
| | |
September 30, 2014 | | |
September 30, 2013 | |
| | |
| | |
| | |
| |
ACI | | |
$ | 2,520 | | |
| 100 | % | |
| 0 | % |
| | |
| | | |
| | | |
| | |
| | |
$ | 2,520 | | |
| 100 | % | |
| 0 | % |
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(Unaudited)
For
the three months ended September 30, 2014 and September 30, 2013, the Company had the following concentrations of revenues with
customers:
Customer | | |
September 30, 2014 | | |
September 30, 2013 | |
| | |
| | |
| |
ACI | | |
| 0 | % | |
| 3 | % |
| | |
| | | |
| | |
SAC | | |
| 0 | % | |
| 50 | % |
| | |
| | | |
| | |
ANR | | |
| 0 | % | |
| 6 | % |
| | |
| | | |
| | |
YMD | | |
| 4 | % | |
| 0 | % |
| | |
| | | |
| | |
IOA | | |
| 4 | % | |
| 0 | % |
| | |
| | | |
| | |
STV | | |
| 4 | % | |
| 0 | % |
| | |
| | | |
| | |
PCI | | |
| 5 | % | |
| 0 | % |
| | |
| | | |
| | |
DSI | | |
| 9 | % | |
| 41 | % |
| | |
| | | |
| | |
MHB | | |
| 41 | % | |
| 0 | % |
| | |
| | | |
| | |
DUO | | |
| 30 | % | |
| 0 | % |
| | |
| | | |
| | |
Total | | |
| 100 | % | |
| 100 | % |
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 nine months ended the Company received $558,000 from seven clients for service to be rendered during this year 2014
and 2015. At September 30, 2014, the Company recognized $308,000 ($247,000 out of December 31, 2013) of this deferred revenue
as revenue; leaving a deferred revenue balance of $250,000.
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(Unaudited)
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.
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.
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(Unaudited)
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).
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. This loan is currently in default, the Company plans to speak to Dreamscapes Properties International Inc.
with a review to discuss a payment plan over the next 6 months.
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 September 30, 2014 and as of December 31, 2013 respectively:
Loans payable – related party – December 31, 2013 | |
$ | 57,194 | |
Proceeds from loans | |
| 700 | |
Repayments | |
| - | |
Loans payable – related party – September
30, 2014 | |
$ | 57,894 | |
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(Unaudited)
(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 September 30, 2014, $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 September 30, 2014
is $324,475. The accrued interest payable at September 30, 2014 amounted to $48,762. The Company assessed if there is a beneficial
conversion feature cost associated with this transaction, none was noted.
(C)
Notes payable
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 September 30, 2014 and is 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. On August 8, 2014 it was
mutually agreed to convert this convertible loan into a payment on account for services to be rendered in Dubai in the near future.
On
September 9, 2013, the Company secured a nine month convertible loan for $32,500 with an 8% interest rate due on June 11, 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 March 17, 2014 the Company decided to allow
this funder to convert $12,000 of this debt in common stock at $0.0406 per share. On April 1, 2014 the Company decided to allow
this funder to convert the rest of this debt in common stock at $0.0425 per share
On
October 9, 2013, the Company secured a two month loan for GBP 75,000 (equivalent to $120,420) with the understanding that the
Company will issue 10,000 common restricted shares, issued to the lender on December 7, 2013, and also repay 35,000 GBP (equivalent
to $56,196) in lieu of interest. As the principal and interest was not paid back to the lender on time. The Company compensated
the lender with an additional 20,000 common restricted shares and for this the lender agreed to five month extension. This stock
compensation as issued to the lender also on December 12, 2013. On February 27, 2014, the Company agreed to pay an extra $50,000
of interest in order to avoid defaulting on the loan. It was mutually agreed that the capital and the interest would be paid once
the $3,540,000 loan, applied for on December 9, 2013, from the United Kingdom financial institution was granted.
On
October 17, 2013, the Company secured a three month bridge loan for 200,000 GBP (equivalent to $319,598) with the agreement to
repay the principle plus 5% per month interest on or before January 18, 2014.
On
November 29, 2013, the Company received a loan in the amount of $450,000 from United Kingdom resident and subsequently the Company
issued a Convertible Note due on November 25, 2014 (“Convertible Note”). The Convertible Note will bear interest at
the rate of 10% per annum until maturity. The Convertible Note may be converted into shares of the issuer’s common stock
at a conversion price of $.50 per share at the option of the holder of the Convertible Note. If the Convertible Note is not paid
in full or converted into common stock of the Company prior to its maturity date, then the Convertible Note will accrue interest
at the rate of 4.5% per annum from the maturity date until paid in full. This $450,000 loan was used as a guarantee for a loan
amounting to $3,540,000 applied for to a United Kingdom financial institution on December 9, 2013. At September 30, 2014 the loan
had still not been approved due to technical reasons solely related to the lender.
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(Unaudited)
On
April 1, 2014, the Company received $53,000 from a secured a nine month convertible loan signed on March 6, 2014. The loan carried
an 8% interest rate and will due on December 10, 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 equal to 130% of total amount due inclusive of principal and interest accrued.
On
April 1, 2014 the Company agreed issue stock at in order to pay off the rest of the note signed on September 9, 2013 ($20,500
plus the $1,300 of accrued interest).
On
May 1, 2014, the Company secured two a 12 month convertible loan for $50,000 each with an 8% interest rate due on May 1, 2015.
The terms of the conversion were agreed at a 40% discount to market based on an average price of the two lowest bids on the 20
trading days prior to the conversion date. If the Company opts to pay the loan back on or before 90 days after the loans were
granted, hence not converting the debt into equity; borrower shall make payment to the holders of an amount in cash equal to 130%
of total amount due inclusive of principal and interest accrued. If the Company opts to pay the loan back on or before 180 days
after the loans were granted, hence not converting the debts into equity; borrower shall make payment to the holders of an amount
in cash equal to 140% of total amount due inclusive of principal and interest accrued. The company also agreed a two collateralized
secured promissory notes (backend notes) under the same terms for a further $50,000 from each lender within six months of the
first loans.
On
June 12 2014, the Company and an investor entered into a two year $250,000 convertible promissory note with an original issue
discount of $25,000. The terms of this convertible note were $55,000 upon closing, an 8% interest rate per annum or 0% interest
if the note was to be paid back within 90 days of the issuance of the note. The terms of the conversion were agreed at the lesser
of $0.30 or a 40% discount to market based on an average price of the lowest bids on the 25 trading days prior to the conversion
date.
The
amounts paid to acquire the debt financing have been treated as a debt discount hence at September 30, 2014 the Company recorded
debt discount of $44,113. This will be amortized over the life of the respective loans. During the nine months ended September
30, 2014 and September 30, 2013, the Company amortized $26,567 and $26,452.
(D)
Accounts payable – related parties
The
following table represents the accounts payable to related parties as of September 30, 2014 and December 31, 2013, respectively:
| | |
September 30, 2014 | | |
December 31, 2013 | |
| | |
| | |
| |
Salaries | | |
| 331,985 | | |
| 182,080 | |
Expenses | | |
| 5,473 | | |
| 9,973 | |
| | |
$ | 337,458 | | |
$ | 192,053 | |
As
discussed in note no. 5(B), the Company converted $324,475 of related party accounts payable into a convertible loan during the
nine months ended September 30, 2014.
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(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.
On
December 12, 2013 the Company issued 450,000 Series “A” preferred shares to the Company’s CFO (200,000), CEO
(200,000) and one employee (50,000) having a fair value of $540,000 ($0.12 per share), based upon the fair value of the services
rendered, which represented the best evidence of fair value.
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 $1,020,000.
There are no redemption requirements.
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(Unaudited)
(B)
Common Stock
During
the six months ended September 30, 2014 the Company issued the following shares:
Date | |
Type | |
Shares | | |
Valuation | | |
Range of value per share | |
3/17/2014 | |
Stock issued for payment of debt | |
| 295,567 | | |
$ | 12,000 | | |
$ | 0.0406 | |
4/1/2014 | |
Stock issued for payment of debt | |
| 501,149 | | |
$ | 109,819 | | |
$ | 0.2190 | |
4/22/2014 | |
Stock issued for services | |
| 165,000 | | |
$ | 8,250 | | |
$ | 0.0500 | |
7/22/2014 | |
Stock issued for services | |
| 115,000 | | |
$ | 17,250 | | |
$ | 0.1500 | |
7/22/2014 | |
Stock issued for services | |
| 50,000 | | |
$ | 7,500 | | |
$ | 0.1500 | |
7/22/2014 | |
Stock issued for services | |
| 12,500 | | |
$ | 1,875 | | |
$ | 0.1500 | |
7/22/2014 | |
Stock issued for services | |
| 276,000 | | |
$ | 41,400 | | |
$ | 0.1500 | |
8/4/2014 | |
Stock issued for services | |
| 200,000 | | |
$ | 30,000 | | |
$ | 0.1500 | |
9/19/2014 | |
Salary Bonus | |
| 500,000 | | |
$ | 80,000 | | |
$ | 0.1600 | |
| |
| |
| | | |
| | | |
| | |
| |
| |
| 2,115,216 | | |
$ | 308,094 | | |
| | |
(C)
Stock payable
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. As of September 30, 2014 $77,350 was 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 September 30, 2014, and are valued at $5,500.
Note
7 - 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 September 30, 2014. The Company has guaranteed a value of
$100,000 for its shares at the time of legend removal. As of September 30, 2014 the legend is still not removed, the Company has
accrued for the shortfall of $77,350 as a stock payable.
Global
Equity International, Inc. and Subsidiary
September
30, 2014
(Unaudited)
Note
8 - Other current assets
The
following is a summary of the Company’s other current assets:
| |
September 30, 2014 | | |
December 31, 2013 | |
Cash collateral paid to secure loan | |
$ | 450,000 | (1) | |
$ | 450,000 | |
| |
| | | |
| | |
Retainers paid to legal counsel | |
| 2,201 | | |
| 2,201 | |
| |
| | | |
| | |
| |
$ | 452,201 | | |
$ | 452,201 | |
| |
| | | |
| | |
|
(1) Please
refer to Note 5(C) – Notes payable |
Note
9 - Subsequent Events
On
October 2, 2014, the Company received $32,500 from a secured a nine month convertible loan signed on September 25, 2014. The loan
carried an 8% interest rate and will due on December 10, 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 equal to 125% of total amount due inclusive of principal and interest accrued.
On
October 2, 2014 a note holder converted $8,000 of debt into 86,207 common shares.
On
October 17, 2014 a note holder converted $4,730 of debt into 162,543 common shares.
On
October 21, 2014 a note holder converted $4,730 of debt into 162,543 common shares.
On
October 27, 2014 a note holder converted $4,730 of debt into 162,543 common shares.
On
November 6 2014 a note holder converted $1,000 of debt into 18,498 common shares.
On
November 7, 2014 the Company was formally informed that the $3,540,000 loan agreed with a United Kingdom financial institution
on December 9, 2013, will be due to commence drawdowns before the end of 2014 subject to our company meeting the conditions precedent
stated in the loan agreement.
Item
2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
For
the three months ended September 30, 2014 and September 30, 2013.
The
Company had revenues amounting to $209,000 and $165,000 for the three months ended September 30, 2014 and September 30, 2013.
Most of our engagements with clients call for the Company to accomplish certain milestones in order to be able to invoice work
completed; hence, to date, we still have deferred revenue receivable amounting to $250,000. Management does invest a lot of time
on behalf of our clients such as meetings with the Dubai NASDAQ, the DFSA (the Dubai Financial Service Authority), marketing and
IR consultants and finally local Dubai DFSA authorized sponsors that have the authority to underwrite a company that wishes to
list its equity on the Dubai NASDAQ. This cannot be deemed as billable work in progress, but management considers that this work
carried out on behalf of our clients, though not quantifiable, is essential in order to accomplish our mandate from clients that
wish to list in Dubai.
The
operating costs for the for the three months ended September 30, 2014 and September 30, 2013 were $470,304 and $366,348 respectively.
| |
Three Months | | |
Three Months | |
| |
September 30, 2014 | | |
September 30, 2013 | |
| |
| | | |
| | |
General and administrative expenses | |
$ | 130,263 | | |
$ | 99,240 | |
Salaries | |
| 251,657 | | |
| 150,000 | |
Professional services | |
| 111,215 | | |
| 116,772 | |
Depreciation | |
| 653 | | |
| 336 | |
Total operating expenses | |
$ | 493,788 | | |
$ | 366,348 | |
The
operating costs for the three months September 30, 2014 suffered a substantial increase in salaries mainly due to the employment
of new staff members in our Dubai office.
The
net losses from operations for the three months ended September 30, 2014 and September 30, 2013 were $284,788 and $201,348, respectively.
Other
income (expenses) amounted to $(71,814) and $(41,795) for the three months ended September 30, 2014 and September 30, 2013 respectively.
The increase is mainly due a substantial increase in accrued interest on loans received.
The
net losses for the three months ended September 30, 2014 and September 30, 2013 were $356,602 and $243,143, respectively.
The
Company had 33,159,418 and 30,784,202 shares issued and outstanding at September 30, 2014 and September 30, 2013, respectively.
The weighted average of the stock for the three months ended September 30, 2014 and September 30, 2013 was 32,474,668 and 30,784,202,
respectively. The loss per share for both periods was $(0.01) and $(0.01), respectively.
For
the nine months ended September 30, 2014 and September 30, 2013.
The
Company had revenues amounting to $555,000 and $171,849 for the nine months ended September 30, 2014 and September 30, 2013, which
is a 223% increase in comparison with the same period last year; this increase in mainly due to having been engaged by many new
clients for US and Dubai listings and also general consultancy work. Also, with our growing team in our Dubai office, we have
been able to accomplish certain milestones, called upon in our contracts, in order to allow us to invoice current clients for
work completed.
The
operating costs for the for the nine months ended September 30, 2014 and September 30, 2013 were $1,079,115 and $1,248,674, respectively.
| |
Nine Months | | |
Nine Months | |
| |
September 30, 2014 | | |
September 30, 2013 | |
| |
| | |
| |
General and administrative expenses | |
$ | 226,463 | | |
$ | 222,634 | |
Salaries | |
| 639,375 | | |
| 390,000 | |
Professional services | |
| 211,648 | | |
| 511,042 | |
Depreciation | |
| 1,630 | | |
| 998 | |
Impairment of financial assets | |
| - | | |
| 160,000 | |
Total operating expenses | |
$ | 1,079,115 | | |
$ | 1,284,674 | |
The
total operating costs for the nine months September 30, 2014 decreased by $205,559. We had to increase the salaries due to the
employment of new staff but we also managed to decrease substantially our dependence on professional services rendered to the
Company.
The
net losses from operations for the nine months ended September 30, 2014 and September 30, 2013 were $524,115 and $1,112,825, respectively.
This substantial decrease in losses is due to two main factors: 1) a 223% increase in income and 2) at September 30, 2013, we
had to impair $160,000 of financial assets.
Other
income (expenses) amounted to $(339,915) and $(37,743) for the nine months ended September 30, 2014 and September 30, 2013, respectively.
As we have been developing the business, we have not been able to depend solely on the receipt of income to fund our operating
costs; hence we have had to incur debt financing which is not inexpensive for early stage companies that are still developing
their business model.
The
net losses for the ended nine months ended September 30, 2014 and September 30, 2013 were $864,030 and $1,150,568, respectively.
The
Company had 33,159,418 and 30,784,202 shares issued and outstanding at September 30, 2014 and September 30, 2013, respectively.
The weighted average of the stock for the nine months ended September 30, 2014 and September 30, 2013 was 31,866,476 and 30,370,730,
respectively. The loss per share for both periods was $(0.01) and $(0.04), respectively.
LIQUIDITY
AND CAPITAL RESERVES
As
reflected in the accompanying financial statements, the Company had a net comprehensive loss of $356,602 and $864,030 for the
three and nine months ended September 30, 2014, respectively. Net cash used in operations of $(239,473) for the nine months ended
September 30, 2014; a working capital deficit of $1,679,831 and stockholders´ deficit of $(2,996,902) as of September 30,
2014. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
As
reflected in the accompanying financial statements, the Company had a net comprehensive loss of $243,143 and $1,150,568 for the
three and nine months ended September 30, 2013, respectively. Net cash used in operations of $(128,845) for the nine months ended
September 30, 2013; a working capital deficit of $(474,666) and stockholders´ deficit of $(1,268,677) as of September 30,
2014. 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.
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. 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. On August 8, 2014 it was mutually agreed to convert this convertible loan into a payment on account for services to
be rendered in Dubai in the near future.
On
September 9, 2013, the Company secured a nine month convertible loan for $32,500 with an 8% interest rate due on June 11, 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 March 17, 2014 the Company decided to allow
this funder to convert $12,000 of this debt into common stock at $0.0406 per share. On April 1, 2014 the Company decided to allow
this funder to convert the rest of this debt in common stock at $0.0435 per share.
On
October 9, 2013, the Company secured a two month loan for GBP 75,000 (equivalent to $120,420) with the understanding that the
Company will issue 10,000 common restricted shares, issued to the lender on December 7, 2013, and also repay 35,000 GBP (equivalent
to $56,196) in lieu of interest. As the principal and interest was not paid back to the lender on time, the Company compensated
the lender with an additional 20,000 common restricted shares and for this the lender agreed to five month extension. This stock
compensation was issued to the lender also on December 12, 2013. On February 27, 2014, the Company agreed to pay an extra $50,000
of interest in order to avoid defaulting on the loan. It was mutually agreed that the principal and the interest would be paid
once the $3,540,000 loan, applied for on December 9, 2013, from the United Kingdom financial institution was granted.
On
October 17, 2013, the Company secured a three month bridge loan for 200,000 GBP (equivalent to $319,598) with the agreement to
repay the principle plus 5% per month interest on or before January 18, 2014.
On
November 29, 2013, the Company received a loan in the amount of $450,000, from a United Kingdom resident and subsequently the
Company issued a Convertible Note due on November 25, 2014 (“Convertible Note”). The Convertible Note will bear interest
at the rate of 10% per annum until maturity. The Convertible Note may be converted into shares of the issuer’s common stock
at a conversion price of $.50 per share at the option of the holder of the Convertible Note. If the Convertible Note is not paid
in full or converted into common stock of the Company prior to its maturity date, then the Convertible Note will accrue interest
at the rate of 4.5% per annum from the maturity date until paid in full. This $450,000 loan was used as a guarantee for a loan
amounting to $3,540,000 applied for to a United Kingdom financial institution on December 9, 2013. At June 30, 2014 the loan had
still not been approved due to technical reasons solely related to the lender. On November 7, 2014 the Company was formally informed
that the $3,540,000 loan agreed with a United Kingdom financial institution on December 9, 2013, will be due to commence drawdowns
before the end of 2014 subject to our company meeting the conditions precedent stated in the loan agreement.
On
April 1, 2014, the Company received $53,000 from a secured a nine month convertible loan signed on March 6, 2014. The loan carried
an 8% interest rate and will due on December 10, 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 equal to 130% of total amount due inclusive of principal and interest accrued.
On
April 1, 2014 the Company agreed to issue stock in order to pay off the rest of the note signed on September 9, 2013 ($20,500
plus the $1,300 of accrued interest).
On
May 1, 2014, the Company secured two 12 month convertible loans for $50,000 each with an 8% interest rate due on May 1, 2015.
The terms of the conversion were agreed at a 40% discount to market based on an average price of the two lowest bids on the 20
trading days prior to the conversion date. If the Company opts to pay the loan back on or before 90 days after the loans were
granted, hence not converting the debt into equity; borrower shall make payment to the holders of an amount in cash equal to 130%
of total amount due inclusive of principal and interest accrued. If the Company opts to pay the loan back on or before 180 days
after the loans were granted, hence not converting the debts into equity, borrower shall make payment to the holders of an amount
in cash equal to 140% of total amount due inclusive of principal and interest accrued. The Company also agreed a two collateralized
secured promissory notes (backend notes) under the same terms for a further $50,000 from each lender within six months of the
first loans.
On
June 12 2014, the Company and an investor entered into a two year $250,000 convertible promissory note with an original issue
discount of $25,000. The terms of this convertible note were $55,000 upon closing, an 8% interest rate per annum or 0% interest
if the note was to be paid back within 90 days of the issuance of the note. The terms of the conversion were agreed at the lesser
of $0.30 or a 40% discount to market based on an average price of the lowest bids on the 25 trading days prior to the conversion
date.
It
is the Company’s intention to seek additional debt financing, which we plan to use as additional working capital to implement
our marketing program to increase awareness of our business model and also to expand our operations via the acquisition of companies
that are in a similar space and industry as ours, although we have not identified any companies that we would consider acquiring.
However,
we do not have any verbal or written agreements with anyone to provide us with debt financing.
Any
short fall in our projected operating revenues will be covered by:
1)
The cash fees that we expect to receive during the next 12 months from the four clients we currently have under contract.
2)
Reducing our expenditures; and
3)
Receiving loans from one or more of our officers even though at the present time, we do not have verbal or written commitments
from any of our officers to lend us money.
Depending
upon market conditions, the Company may not be successful in raising sufficient additional capital for it to achieve its business
objectives.
In
such event, the business, prospects, financial condition, and results of operations could be materially adversely affected.
On
May 28, 2014 the Company announced that it had appointed His Highness Sheikh Rashed bin Ahmed bin Maktoum Al Maktoum
(A Member of the ruling royal family of Dubai). This appointment underpinned the Company fully owned subsidiary, Global Equities
Partners Plc’s, rapidly increasing advisory work in the UAE as capital market activity returns supported by a wider resurgent
economy. For 2014, the IMF has predicted UAE GDP growth of 4.5% driven by robust economic fundamentals, Dubai’s recent Expo
2020 win and Abu Dhabi’s buoyant oil and gas industry and aligned investment. In addition, MSCI’s (Morgan Stanley
Capital International) recent upgrade of the UAE to ‘emerging market’ status is expected to facilitate capital inflow
into the Emirate of around US$ 370 million according to industry experts.
On
September 24, 2014 we were engaged by a company called VT Hydrocarbons Limited to assist with the raising them between 45 million
US and 100 million US in order to acquire an existing storage facility and repurpose it to specialize in wet fuel storage and
LPG (Liquid Petroleum Gas) storage in Jordan. Our contractual agreement with our client was a 1.5% cash success fee and a 1.5%
equity fee. On November 5, 2014 we announced through a press release that we have we had effectively sourced the 78 million US
of funding for our client and that they were in physical possession of a letter of “Proof of Funds” from the potential
investors for the first phase of $45 million US. The second phase of $32 million US will be sourced through the same channel of
funding.
FUTURE
PLANS
MILESTONES
FOR 2014:
Our
specific plan of operations and milestones through 2015 are as follows:
|
1) |
DEVELOP
THE INTRODUCER NETWORK FURTHER AND IN HOPES OF ATTRACTING NEW INTEREST FOR OUR SERVICES. |
We
currently are relying on introductions to potential clients by the following firms in Asia and Europe:
|
(1) |
Certain registered
investment houses in London (United Kingdom). |
|
|
|
|
(2) |
An Austrian management
consultancy firm based in Vienna (Austria). |
|
|
|
|
(3) |
Various investment
banks based in Dubai (UAE) |
|
|
|
|
(4) |
Certain Private
Banks based in Amsterdam (Holland) and Zurich in Switzerland. |
|
|
|
|
(5) |
The Colombo Stock
Exchange in Sri Lanka. |
|
|
|
|
(6) |
Various family
offices in Dubai (UAE). |
|
|
|
|
(7) |
Various finance professionals in South East Asia. |
We
do not have any verbal or written agreements with the firms identified above, as our relationship with each of them has been developed
over the past year or so.
We
intend to develop relationships with a further eight “introducers” to potential new business for the Company before
the end of December 2015.
We
will continue to establish a firm presence in Dubai, UAE where we are attracting clients, relationships and awareness. Our Dubai
operation is currently a branch office of the company allowing us a license to trade in the UAE. This branch office will continue
to recruit new members of staff that will allow us to grow and become more efficient in Dubai and to have a firm back office set
up allowing as to effectively deal with our prospects and clients
|
3) |
CREATE
A MORE EFFICIENT SYSTEM FOR REVIEWING PROSPECTIVE BUSINESSES. |
We
will concentrate our efforts on the quality of the company that is introduced to us. We will start off by sending the client a
standard due diligence list and request that they complete the list and send us the support for review. We will then follow-up
the due diligence with a “site visit” in order to properly understand our client’s business model and more importantly
meet the principals in person.
We
will create a deeper due diligence program allowing us to dig deep on any prospective client prior to engagement, thus protecting
the Company from any future problems by employing one new staff member that will be responsible for the due diligence analysis
and creating a report for our file on their findings.
We
will perform comparative analysis on any prospective client allowing us to assess the viability of the potential to the company
for the time spent.
|
4) |
EXPAND
OUR CONSULTANCY TO INCLUDE MORE MERGER AND ACQUISITION ACTIVITY. |
We
intend to form relationships with merger and acquisition specialists during 2014 which will hopefully enable us to:
|
(1) |
Find potential
merger and acquisition candidates. |
|
|
|
|
(2) |
Introduce our
clients to brokers and investment bankers. |
|
|
|
|
(3) |
Introduce
our clients to the appropriate professionals (attorneys and accountants) to assist them in a public offering or exchange listing. |
The
only additional cost for this activity will be a very small administrative burden for telephone calls and communications to be
funded out of operational income, mainly income receivable from clients currently under contract.
|
5) |
DEVELOP
IN HOUSE IT DEPARTMENT |
Commencing
initially with one member we will start to develop a proprietary program allowing us to easily monitor a client’s development
status and work in progress. We will also use this tool to manage our pipeline of clients and, therefore, it will become vital
in our cash flow forecasting.
We
will also utilize various websites and social media to enhance the reputation and service of the Company from our IT division
allowing us to cost effectively market our Company and its services.
In
2015, we intend to become one of the first foreign companies to dual list on Dubai NASDAQ; our plan is to carry out a public relations
campaign alongside the dual listing process with the public relations firm we have selected with a view to preparing a campaign
that will have a maximum effect.
|
7) |
EXPAND
OUR NETWORK OF CONTACTS WITHIN THE INVESTMENT COMMUNITY IN DUBAI |
Our
network of investment companies in Dubai is currently small; however, we intend to substantially expand our Dubai network in order
to enable us to make introductions on a more institutional level. We intend to develop our network to at least twelve Investment
Institutions who may have interests in minority shareholding in companies from outside of the Middle East Region.
At
present, we are being received with open arms by the Dubai and Middle Eastern financial community; hence, we have plans to host
various hospitality events for our current clients, our key contacts and upper management of the company.
|
8) |
EXPAND
OUR RANGE OF BUSINESS AND CONTACTS |
We
intend to take our consultancy service outside of the Middle East and Europe into Asia and Sri Lanka. We will expand on a ‘Commission
Only’ basis for the individuals or companies who take on our service to offer to their clients. Accountants, lawyers and
finance professionals are the target market for overlaying our service into their existing client banks in return for a percentage
of fees received. We also intend to add at least three new members to our administration team before December 31, 2014.
We
will continue the “Road shows”, in Dubai with the support of the Dubai NASDAQ for companies already listed in Sri
Lanka and other parts of Asia who could be seeking a dual listing in Dubai to provide liquidity and more capital raising options.
We have commenced initial conversations with a brokerage house in Sri Lanka to look at their clients they have that would be suitable
for the Dubai market. We will initially invite management of selected companies to Dubai for a two day event in conjunction with
NASDAQ Dubai and a number of leading Investment Institutions, the anticipated cost of this is to be met by the prospective clients
themselves and sponsorship from the institutions. The first Sri Lanka/ Dubai road show is expected to be held by the company for
the Sri Lankan companies in Q1 2015 with plans being made now with the media for the exposure of the event. We intend to perform
a similar service for companies out of Thailand and to also invite both country representatives to USA for a similar road show
event.
|
10) |
FURTHER
EXPAND OUR RANGE OF BUSINESS AND CONTACTS |
The
foundation for this development was created in 2013. In 2014 and 2015, we intend to cement the relationships created. The target
markets for attracting clients are: Thailand, Sri Lanka, China, Hong Kong and Singapore
To
service the clients generated from these markets, we will spend time creating a network of service companies who we can utilize
to assist us on a local basis. We will explore the possibilities of dual listings for our clients in Singapore to allow us a local
market for any Asian clients we may attract and give the company a firm foothold in the Asian territory.
We
will explore both companies who could require our service and companies who can assist us with development in the local market
in the chosen location.
|
11) |
EMPLOYEES;
IDENTIFICATION OF A SIGNIFICANT EMPLOYEE |
We
currently have five employees: Peter J. Smith, Enzo Taddei, Patrick V. Dolan, Zara V. Clark and Shoaib Rasool, Peter J. Smith,
our President, and Enzo Taddei, our Chief Financial Officer, and Patrick V. Dolan, Global Equity Partners Managing Director, Zara
V. Clark, our Dubai office anager, Shoaib Rasool, our in house analyst and accountant, each have an employment agreement with
the Company. All are full time employees of the Company. We have also engaged Mr. Mark Thornton, based in London, who will act
as a new business developer and Mr. Patrick Hobbs, also based in London, who has been tasked with client management and general
liaison; both are managed in London by Mr. Patrick V. Dolan, Global Equity Partners Plc. Managing Director.
Cautionary
Forward - Looking Statement
The
following discussion and analysis of the results of operations and financial condition of Global Equity International, Inc. should
be read in conjunction with the unaudited financial statements, and the related notes. References to “we,” “our,”
or “us” in this section refers to the Company and its subsidiaries. Our discussion includes forward-looking statements
based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions.
We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,”
“ongoing,” “expect,” “believe,” “intend,” “may,” “will,”
“should,” “could,” and similar expressions to identify forward-looking statements.
Certain
matters discussed herein may contain forward-looking statements that are subject to risks and uncertainties. Such risks and uncertainties
include, but are not limited to, the following:
|
● |
the volatile and
competitive nature of our industry, |
|
|
|
|
● |
the uncertainties
surrounding the rapidly evolving markets in which we compete, |
|
|
|
|
● |
the uncertainties
surrounding technological change of the industry, |
|
|
|
|
● |
our dependence
on its intellectual property rights, |
|
|
|
|
● |
the success of
marketing efforts by third parties, |
|
|
|
|
● |
the changing demands
of customers and |
|
|
|
|
● |
the arrangements
with present and future customers and third parties. |
Should
one or more of these risks or uncertainties materialize or should any of the underlying assumptions prove incorrect, actual results
of current and future operations may vary materially from those anticipated.
Item
3. Quantitative and Qualitative Disclosure about Market Risk.
Not
applicable.
Item
4. Controls and Procedures.
Evaluation
of Disclosure Controls and Procedures
As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation
of our Principal Executive Officer and Principal Financial Officer of the effectiveness of the design and operation of our disclosure
controls and procedures. Based on this evaluation, our Principal Executive Officer and Principal Financial Officer concluded that
our disclosure controls and procedures (as defined in Rules 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of
1934) were not effective.
Management’s
Report on Internal Control over Financial Reporting
Our
management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules
13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies
and procedures that:
|
(1) |
pertain
to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of
our assets; |
|
|
|
|
(2) |
provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance
with U.S. GAAP, and that our receipts and expenditures are being made only in accordance with the authorization of our management
and directors; and |
|
|
|
|
(3) |
provide
reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets
that could have a material effect on the financial statements. |
Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes
in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
At
September 30, 2014, we carried out an evaluation required by Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934
(the “Exchange Act”) under the supervision and with the participation of our management, including our Principal Executive
Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures.
Based
upon such evaluation, such person concluded that as of such date, our disclosure controls and procedures were not effective at
the reasonable assurance level because, due to financial constraints, the Company does not maintain a sufficient complement of
personnel with an appropriate level of technical accounting knowledge, experience and training in the application of generally
accepted accounting principles commensurate with our financial accounting and reporting requirements. In the event that we may
receive sufficient funds for internal operational purposes, we plan to retain the services of additional internal management staff
to provide assistance to our current management with the monitoring and maintenance of our internal controls and procedures.
This
Quarterly Report does not include an attestation report of the Company’s registered public accounting firm due to a transition
period established by rules of the Securities and Exchange Commission for newly public companies.
Changes
in internal control over financial reporting.
We
did not change our internal control over financial reporting during our last fiscal quarter that materially affected, or is reasonably
likely to materially affect, the Company’s internal control over financial reporting.
PART
II – OTHER INFORMATION
Item
1. Legal Proceedings.
The
Company is not aware of any threatened or pending litigation against the Company.
Item
1A. Risk Factors.
Not
applicable.
Item
2. Unregistered Sales of Equity Securities and Use of Proceeds.
Stock
sales and issuances since January 1, 2014
Date | |
Type | |
Shares | | |
Valuation | | |
Range of value
per share | |
3/17/2014 | |
Stock issued for payment of debt | |
| 295,567 | | |
$ | 12,000 | | |
$ | 0.0406 | |
4/1/2014 | |
Stock issued for payment of debt | |
| 501,149 | | |
$ | 109,819 | | |
$ | 0.2190 | |
4/22/2014 | |
Stock issued for services | |
| 165,000 | | |
$ | 8,250 | | |
$ | 0.0500 | |
7/22/2014 | |
Stock issued for services | |
| 115,000 | | |
$ | 17,250 | | |
$ | 0.1500 | |
7/22/2014 | |
Stock issued for services | |
| 50,000 | | |
$ | 7,500 | | |
$ | 0.1500 | |
7/22/2014 | |
Stock issued for services | |
| 12,500 | | |
$ | 1,875 | | |
$ | 0.1500 | |
7/22/2014 | |
Stock issued for services | |
| 276,000 | | |
$ | 41,400 | | |
$ | 0.1500 | |
8/4/2014 | |
Stock issued for services | |
| 200,000 | | |
$ | 30,000 | | |
$ | 0.1500 | |
9/19/2014 | |
Salary Bonus | |
| 500,000 | | |
$ | 80,000 | | |
$ | 0.1600 | |
10/2/2014 | |
Stock issued on debt conversion | |
| 86,207 | | |
$ | 8,000 | | |
$ | 0.0928 | |
10/17/2014 | |
Stock issued on debt conversion | |
| 162,543 | | |
$ | 4,730 | | |
$ | 0.0291 | |
10/21/2014 | |
Stock issued on debt conversion | |
| 162,543 | | |
$ | 4,730 | | |
$ | 0.0291 | |
10/27/2014 | |
Stock issued on debt conversion | |
| 162,543 | | |
$ | 4,730 | | |
$ | 0.0291 | |
11/6/2014 | |
Stock issued on debt conversion | |
| 18,498 | | |
$ | 1,000 | | |
$ | 0.0541 | |
| |
| |
| | | |
| | | |
| | |
| |
| |
| 2,707,550 | | |
| 331,284 | | |
| | |
These
shares were issued for debt reductions and general working capital.
These
shares were issued pursuant to exemptions from the registration requirements of the Securities Act of 1933, as amended (“1933
Act”) pursuant to Section 4(a)(1) of the 1933 act and Regulation S promulgated thereunder.
Item
3. Defaults upon Senior Securities.
None.
Item
4. Mine Safety Disclosures.
Not
applicable.
Item
5. Other Information.
None.
Item
6. Exhibits.
See
Exhibit Index below for exhibits required by Item 601 of regulation S-K.
EXHIBIT
INDEX
List
of Exhibits attached or incorporated by reference pursuant to Item 601 of Regulation S-K:
Exhibit
No |
|
Description |
|
|
|
31.1 * |
|
Certification
under Section 302 of Sarbanes-Oxley Act of 2002 |
|
|
|
31.2 * |
|
Certification
under Section 302 of Sarbanes-Oxley Act of 2002 |
|
|
|
32.1 * |
|
Certification
under Section 906 of Sarbanes-Oxley Act of 2002 |
|
|
|
32.2 * |
|
Certification
under Section 906 of Sarbanes-Oxley Act of 2002 |
|
|
|
101.INS** |
|
XBRL Instance
Document |
101.SCH** |
|
XBRL Taxonomy
Extension Schema |
101.CAL** |
|
XBRL Taxonomy
Extension Calculation Linkbase |
101.DEF** |
|
XBRL Taxonomy
Extension Definition Linkbase |
101.LAB** |
|
XBRL Taxonomy
Extension Label Linkbase |
101.PRE** |
|
XBRL Taxonomy
Extension Presentation Linkbase |
* |
Filed herewith. |
** |
In
accordance with Regulation S-T, the XBRL related information on Exhibit No. 101 to this Quarterly Report on Form 10-Q shall
be deemed “furnished” herewith not “filed”. |
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
|
GLOBAL
EQUITY INTERNATIONAL, INC. |
|
|
Date:
November 13, 2014 |
/s/
Peter J. Smith |
|
Peter
J. Smith |
|
President
and Chief Executive Officer |
|
(Principal
Executive Officer) |
|
|
Date:
November 13, 2014 |
/s/
Enzo Taddei |
|
Enzo
Taddei |
|
Chief
Financial Officer |
|
(Principal
Accounting and Financial Officer) |
Exhibit 31.1
GLOBAL EQUITY INTERNATIONAL,
INC.
A Nevada corporation
CERTIFICATION OF PRINCIPAL
EXECUTIVE OFFICER
Section 302 Certification
I, Peter J. Smith, certify that:
| 1. | I
have reviewed this quarterly report on Form 10-Q of Global Equity International, Inc.
for the nine months ended September 30, 2014. |
| 2. | Based
on my knowledge, this quarterly report does not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements made, in light
of the circumstances under which such statements were made, not misleading with respect
to the period covered by this report; |
| 3. | Based
on my knowledge, the financial statements, and other financial information included in
this interim report, fairly present in all material respects the financial condition,
results of operations and cash flows of the registrant as of, and for, the periods presented
in this report; |
| 4. | I
am responsible for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial
reporting (as defined in Exchange Act Rules 13a-15 (f) and 15d-15(f)) for the registrant
and have: |
| a) | Designed
such disclosure controls and procedures, or caused such disclosure controls and procedures
to be designed under my supervision, to ensure that material information relating to
the registrant, including its consolidated subsidiaries, is made known to me by others
within those entities, particularly during the period in which this annual report is
being prepared; |
| b) | Designed
such internal control over financial reporting, or caused such internal control over
financial reporting to be designed under my supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting principles; |
| c) | Evaluated
the effectiveness of the registrant’s disclosure controls and procedures and presented
in this report my conclusions about the effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this report based on such evaluation; |
| d) | Disclosed
in this report any change in the registrant’s internal control over financial reporting
that occurred during the registrant’s most recent fiscal quarter that has materially
affected, or is reasonably likely to materially affect, the registrant’s internal
control over financial reporting; and |
| 5. | I
have disclosed, based on my most recent evaluation of internal control over financial
reporting, to the registrant’s auditors and the audit committee of the registrant’s
board of directors (or persons performing the equivalent function): |
| a) | All
significant deficiencies in the design of operation of internal controls which would
adversely affect the registrant’s ability to record, process, summarize and report
financial data and have identified for the registrant’s auditors any material weakness
in internal controls; and |
| b) | Any
fraud, whether or not material, that involves management or other employees who have
a significant role in the small business issuer’s internal control over financial
reporting. |
Date:
November 13, 2014 |
/s/
Peter J. Smith |
|
Peter
J. Smith |
|
President
and Chief Executive Officer |
|
(Principal
Executive Officer) |
Exhibit 31.2
GLOBAL EQUITY INTERNATIONAL,
INC.
A Nevada corporation
CERTIFICATION OF PRINCIPAL
FINANCIAL OFFICER
Section 302 Certification
I, Enzo Taddei, certify that:
| 1. | I have reviewed this quarterly
report on Form 10-Q of Global Equity International, Inc. for the nine months ended September
30, 2014. |
| 2. | Based on my knowledge, this
quarterly report does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to the period covered
by this report; |
| 3. | Based on my knowledge, the financial
statements, and other financial information included in this interim report, fairly present
in all material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this report; |
| 4. | I am responsible for establishing
and maintaining disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in
Exchange Act Rules 13a-15 (f) and 15d-15(f)) for the registrant and have: |
| a. | Designed such disclosure
controls and procedures, or caused such disclosure controls and procedures to be designed
under my supervision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to me by others within those entities,
particularly during the period in which this annual report is being prepared; |
| b. | Designed such internal
control over financial reporting, or caused such internal control over financial reporting
to be designed under my supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes
in accordance with generally accepted accounting principles; |
| c. | Evaluated the effectiveness
of the registrant’s disclosure controls and procedures and presented in this report
my conclusions about the effectiveness of the disclosure controls and procedures, as
of the end of the period covered by this report based on such evaluation; |
| d. | Disclosed in this report
any change in the registrant’s internal control over financial reporting that occurred
during the registrant’s most recent fiscal quarter that has materially affected,
or is reasonably likely to materially affect, the registrant’s internal control
over financial reporting; and |
| 5. | I have disclosed, based on my
most recent evaluation of internal control over financial reporting, to the registrant’s
auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent function): |
| a. | All significant deficiencies
in the design of operation of internal controls which would adversely affect the registrant’s
ability to record, process, summarize and report financial data and have identified for
the registrant’s auditors any material weakness in internal controls; and |
| b. | Any fraud, whether or not
material, that involves management or other employees who have a significant role in
the small business issuer’s internal control over financial reporting. |
Date:
November 13, 2014 |
/s/
Enzo Taddei |
|
Enzo Taddei |
|
Chief Financial
Officer |
|
(Principal Accounting
and Financial Officer) |
Exhibit 32.1
GLOBAL EQUITY INTERNATIONAL, INC.
A Nevada corporation
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the
Quarterly Report of Global Equity International, Inc. (“Company”) on Form 10-Q for the quarter ended September 30,
2014, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Peter J. Smith, President
and Chief Executive Officer, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that:
(1) The Report fully complies
with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained
in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
A signed original of this
written statement required by Section 906, or other document authentication, acknowledging, or otherwise adopting the signature
that appears in typed from within the electronic version of this written statement required by Section 906, has been provided
to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
Date:
November 13, 2014 |
/s/
Peter J. Smith |
|
Peter J. Smith |
|
President and
Chief Executive Officer |
|
(Principal Executive
Officer) |
Exhibit 32.2
GLOBAL EQUITY INTERNATIONAL,
INC.
A Nevada corporation
CERTIFICATION PURSUANT
TO
18 U.S.C. SECTION 1350
SECTION 906 OF THE SARBANES-OXLEY
ACT OF 2002
In connection with the
Quarterly Report of Global Equity International, Inc. (“Company”) on Form 10-Q for the quarter ended September 30,
2014, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Enzo Taddei, Chief
Financial Officer, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, that:
(1) The Report fully complies
with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained
in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
A signed original of this
written statement required by Section 906, or other document authentication, acknowledging, or otherwise adopting the signature
that appears in typed from within the electronic version of this written statement required by Section 906, has been provided
to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
Date:
November 13, 2014 |
/s/
Enzo Taddei |
|
Enzo Taddei |
|
Chief Financial
Officer |
|
(Principal Accounting
and Financial Officer) |
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