Silo Pharma, Inc. - Annual Report: 2012 (Form 10-K)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2012 or
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from [ ] to [ ]
Commission file number 333-173163
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POINT CAPITAL, INC.
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(Name of Registrant as Specified in Its Charter)
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Delaware
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27-3046338
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(State or Other Jurisdiction of Incorporation or Organization)
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(I.R.S. Employer Identification No.)
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285 Grand Avenue, Building 5, Englewood, New Jersey
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07631
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(Address of Principal Executive Offices)
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(Zip Code)
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Registrant's telephone number, including area code (201) 408-5126
Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Name of each exchange on which registered
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None
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Securities registered pursuant to Section 12(g) of the Act:
Common Shares, $0.0001 value
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(Title of class)
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Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No x
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x
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 o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). x Yes o No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
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| Non-accelerated filer o | Smaller reporting company x | ||
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(Do not check if a smaller reporting company)
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x
There was no aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the average bid and asked prices of such common equity, as of June 30, 2012, the last business day of the registrant’s most recently completed second fiscal quarter. As of March 5, 2013, there were 30,631,200 shares of common stock, par value $0.0001 per share, outstanding.
TABLE OF CONTENTS
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PART I
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PART II
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PART III
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PART IV
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K (“Annual Report”) contains forward-looking statements that involve risks and uncertainties. Many of the forward-looking statements are located in “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” and similar terms. Forward-looking statements are not guarantees of future performance and the Company’s actual results may differ significantly from the results discussed in the forward-looking statements. Forward-looking statements are only predictions based on our current expectations and projections, or those of third parties, about future events and involve risks and uncertainties. We assume no obligation to revise or update any forward-looking statements for any reason, except as required by law. All forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the cautionary statements included in this Annual Report.
PART I
Unless the context provides otherwise, when we refer to the “Company,” “we,” “our,” or “us” in this Form 10-K, we are referring to Point Capital, Inc. (formerly known as Gold Swap Inc.)
Corporate Background
Point Capital, Inc. was incorporated under its original name Gold Swap Inc. under the laws of the State of New York on July 13, 2010. We are a development stage company, formed to facilitate the broad-scale recycling of jewelry, and other items containing precious metals in the U.S. and internationally. We intend to utilize consumer oriented advertising efforts to solicit individuals interested in liquidating unwanted jewelry and other items containing precious metals. Through a global platform, we will facilitate an end-to-end consumer solution, from acquisition of the used jewelry through liquidation. Our focus will be on providing a fast, secure and convenient service that will enable the public to discretely sell their precious metals from the comfort and security of their homes or offices. We hope to develop relationships with refineries that will allow us to secure current market prices for all of the precious metals we purchase on a daily basis. From our inception to date, we have not generated any revenues, and our operations have been limited to organizational, start-up, and capital formation activities and initial investigations into the design and production of our business. We currently have no employees other than our officers, two of whom are also our directors. We have never intended and do not intend to be a blank check company. We have a specific business plan and do not intend to engage in any merger, acquisition or business reorganization with any entity. Notwithstanding, management is currently exploring various other business opportunities, including considering becoming a business development company.
On December 11, 2012, shareholders holding 25,519,700 (representing 83.3%) of the issued and outstanding shares of Common Stock executed and delivered to the Company their written consent to change the Company’s state of incorporation from New York to Delaware by the merger of Gold Swap with and into its wholly-owned subsidiary, Point Capital, Inc., and to change the name of the Company from “Gold Swap Inc.” to “Point Capital, Inc.” The Definitive Information Statement pursuant to Section 14(c) of the Securities Exchange Act of 1934 was mailed to shareholders on or about December 31, 2012. The merger was effective on January 24, 2013.
The address of our principal executive office is c/o Point Capital, Inc., 285 Grand Avenue, Building 5, Englewood, NJ 07631. Our telephone number is 07631. We own two internet websites at the following URLs: www.bucksforbling.com and www.pointcapitalinc.com.
1
Process
Although we never generated any sales, when someone decides they want us to help them dispose of an item for cash, they will simply contact us through our websites or a toll-free number (that will be set up solely for this purpose), where we will collect basic information that is used to deliver our mail-order kit to them. This kit will include a welcome letter, a Ziploc pouch, a tear free prepaid shipping envelope and a form on which the customer provides their contact information as well as a record of the items being sent. Upon receipt, the sellers fill the kit with the items they wish to sell and send the kit to a refinery, with which we have established a relationship. Each mail-order kit may be tracked via our website and upon its arrival the materials are assessed. The refinery will immediately value the items received based on a variety of factors including metal type, purity and weight, and then issue payment to the seller. If we decide to purchase the item, we send the customer a check within a 72-hour period of appraisal of the items. The customer has a fourteen day period from the date of the check in which they can accept the amount paid for the items and cash the check, or they may return the check to us. If the customer cashes the check or fails to return the check before the end of the fourteen-day period, the transaction will be completed and the precious metals will then be refined and sold. If the customer returns the check to us within the fourteen- day period, we will return the items to the customer.
We hope that the vast majority of our sales will be made to refineries. We hope that the refineries we engage will have the knowledge, experience and technical expertise, coupled with a state-of-the art refining facility that will allow them to control their costs and maximize their pricing on purchases. We hope that these low costs will be passed on to us, which, when coupled with current day spot market purchase prices, will help to provide us with a competitive advantage in the marketplace. There is no assurance that we will be able to engage a refinery on terms that will be favorable to us.
We have not generated any revenues since formation.
Security Measures
We will face the risk of theft from inventory or during shipment to refineries. We will take steps to prevent such theft by implementing comprehensive surveillance and security measures and we will maintain insurance to cover losses resulting from theft or loss. If and when we are able to obtain insurance, each kit will be insured for up to $500. However, if security measures fail, losses exceed insurance coverage or we are not able to maintain insurance at a reasonable cost, we could incur significant losses from theft, which would substantially harm our business and results of operations.
Marketing
If we were to proceed with this business, we will utilize direct response advertising and marketing campaigns, including television, radio, print and the Internet to solicit precious metals from the public. The methods of advertising used and the level of advertising investment varies by market as well as by a variety of factors that influence the effectiveness of direct response advertising such as time of year, local or global televised events, etc. Television and radio advertisements can be targeted toward specific demographics based on the type of show and time of day. Internet marketing targets various demographics by advertising on publisher websites, most commonly with banners and contextual banners, focused on generating potential customers by driving traffic to our websites. Upon completion of the back-end of our website and execution of agreements with third parties refiners, we hope to work on developing an on-line lead generation and marketing campaign. It is our hope that this campaign will generate traffic from parties interested in converting their unwanted precious metals to cash.
2
Competition
The industry for individuals and businesses seeking to extract value from items, such as jewelry, has changed dramatically over the past several years. Historically, liquidation options were limited to pawn shops, garage sales, newspaper and advertisements. With the continued penetration of the Internet, additional avenues such as eBay Inc. and Craigslist have become viable options as well. Although there may be benefits to utilizing one of these options, often they can be time consuming, labor intensive, involve safety risks or a lack of privacy. We believe that our service overcomes all of these drawbacks.
There are several companies that have an approach similar to ours, including Green Bullion Financial Services, LLC (www.Cash4Gold.com), BGC Management, Inc. (Brokengold.com), Lippincott, LLC (goldkit.com), and Postal Gold. We believe that the remainder of the market is highly fragmented and that the majority of the remaining competitors are small pawn shops and jewelry stores that do not view this service as a primary component of their businesses.
The combination of the global economic downturn and the recent increases in precious metal prices have led to a dramatic increase in the number of people wanting to cash in their gold and other precious metal items. Although this has contributed to the revenue growth the industry has experienced recently, it has also resulted in an increase in the number of competitors in the marketplace. Some of these competitors operate without regard to legal requirements or to the overall reputation of the industry by disposing of their customer’s items prior to the prescribed holding periods and by offering extremely low purchase prices for the items to be sold. As a result of these incidents, the media has portrayed the overall industry in a negative light. This has resulted in additional customer scrutiny, increased governmental regulations, and has applied pressure on purchase costs.
3
Intellectual Property
We do not own any intellectual property rights except for the two internet websites at the following URLs: www.bucksforbling.com and www.pointcapitalinc.com that we own.
Governmental Regulations
Because of the nature of our business, we will be subject to the Federal Trade Commission’s unfair trade practice rules and various state laws designed to protect consumers including “little” unfair trade practice laws, as well as similar laws and regulations in the other markets in which we will operate. As we expand globally, we will be subject to the laws of each country where we operate. In some countries like the United Kingdom, regulatory bodies are required to pre-approve advertising spots and to investigate complaints from the public.
In addition to general business requirements, some of these laws dictate licensing and/or procedural requirements to operate as well as prescribing mandatory holding periods after acquisition of items before they can be resold and/or liquidated. We will adapt our processes and procedures to comply with these requirements.
The Digital Millennium Copyright Act has provisions that limit, but do not necessarily eliminate, our liability for listing or linking to third-party websites that include materials that infringe copyrights or other rights, so long as we comply with the statutory requirements of this act. The Child Online Protection Act and the Children’s Online Privacy Protection Act restrict the distribution of materials considered harmful to children and impose additional restrictions on the ability of online services to collect information from minors. In the area of data protection, the European Union and many states have passed laws requiring notification to users when there is a security breach for personal data, such as California’s Information Practices Act and Florida regulates secondhand dealers.
Employees
We have no employees other than our two executive officers, who are also two of our three directors. All functions including development, strategy, negotiations and administration are currently being provided by our executive officers at rates described in this Annual Report. Our officers and directors do not work exclusively for us and do not devote all of their time to our operations. Their other activities prevent them from devoting their full-time to our operations.
4
As a “smaller reporting company” as defined by Rule 229.10(f)(1), we are not required to provide the information required by this Item 1A.
Not Applicable.
Our principal executive offices are located at 285 Grand Avenue, Building 5, Englewood, NJ 07631. We are not paying any rent for such space and we believe that our current office space will be adequate for the foreseeable future.
5
There are no pending legal proceedings to which we are a party or in which any of our directors, officers or affiliates, any owner of record or beneficially of more than 5% of any class of voting securities of our company, or security holder is a party adverse to us or has a material interest adverse to us. Our property is not the subject of any pending legal proceedings.
Not applicable.
PART II
Market Information
Our common stock is quoted on the OTCBB under the symbol “PTCI”, formerly “GDSW”. Trading of our common stock commenced on January 6, 2012. However, there has never been a market for our common stock.
Security Holders
As of March 5, 2013, there were 30,631,200 shares of common stock issued and outstanding, which were held by approximately 35 stockholders of record.
Dividend Policy
We have not declared or paid dividends on our common stock since our formation, and we do not anticipate paying dividends in the foreseeable future. Declaration or payment of dividends, if any, in the future, will be at the discretion of our Board of Directors and will depend on our then current financial condition, results of operations, capital requirements and other factors deemed relevant by the board of directors. There are no contractual restrictions on our ability to declare or pay dividends.
Recent Sales of Unregistered Securities
None.
6
Equity Compensation Plans
We do not have any equity compensation plans.
Not Applicable.
Certain statements contained in this Annual Report, including statements regarding the anticipated development and expansion of our business, our intent, belief or current expectations, primarily with respect to our future operating performance and the products we expect to offer and other statements contained herein regarding matters that are not historical facts, are "forward-looking" statements. Future filings with the SEC, future press releases and future oral or written statements made by us or with our approval, which are not statements of historical fact, may contain forward-looking statements, because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.
All forward-looking statements speak only as of the date on which they are made and reflect our plans, estimates and beliefs. Our actual results could differ materially from those anticipated in these forward-looking statements. See “Special Note Regarding Forward-Looking Statements” elsewhere in this Annual Report.
We undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they are made.
The following discussion and analysis should be read in conjunction with the audited financial statements and notes thereto included elsewhere in this Annual Report.
Overview
We are focused on the business of direct-from-consumer, procurement and aggregation of precious metals to be recycled. We intend to utilize consumer oriented advertising efforts to solicit individuals interested in liquidating unwanted jewelry and other items containing precious metals. Through a global platform, we will facilitate an end-to-end consumer solution, from acquisition through liquidation. We intend to utilize a low cost, highly scalable and flexible business model that will allows us to quickly and efficiently adapt to entry into new markets, changes in economic conditions, supply and demand levels and other similar factors. Currently management is exploring various other business opportunities, including considering becoming a business development company.
7
Plan of Operation
If management determines to proceed with its business plan, over the next twelve months the Company will need to focus on the following activities:
● locating and entering into agreements with one or more refineries;
● soliciting individuals interested in selling unwanted items containing precious metals;
● providing those individuals with the means and materials necessary to send those items in to the refineries; and
● deriving profits from the spread between the scrap price and the spot price.
We have no day-to-day operations. If we are not successful at generating revenues and obtaining funds, we will have to curtail our efforts.
Results of Operations
Revenues
The Company is in its development stage and did not generate any revenues during the period from July 13, 2010 (inception) through December 31, 2012.
Total operating expenses
For the year ended December 31, 2012 total operating expenses were $39,446 consisting mainly of professional accounting, legal, and Edgar fees related to SEC required filings. For the year ended December 31, 2011 total operating expenses were $49,803 which consisted mainly of professional accounting, legal, and Edgar fees related to SEC required filings.
8
Net loss
Net loss for the year ended December 31, 2012 was $39,446. During the period from July 13, 2010 (inception) through December 31, 2012, the Company had a net loss of $1,167,754.
Liquidity and Capital Resources
As of December 31, 2012, the Company had a cash balance of $279. Such funds are insufficient to fund the operations over the next twelve months. There can be no assurance that additional capital will be available to the Company. The Company currently has no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources. The previous officers and directors had orally agreed to lend funds to the Company in the event capital is required for the operations of the Company. However, neither Mr. Schlossberg nor Mr. Ptalis are officers and directors of the Company, having resigned as of January 28, 2013. Since the Company has no such arrangements or plans currently in effect, its inability to raise funds for the above purposes will have a severe negative impact on its ability to remain a viable company.
We currently have no commitments with any person for any capital expenditures.
On April 25, 2012 the Company executed amendments to 6% promissory notes with five lenders, each note identical and each note in the original principal amount of $3,000. The principal and accrued interest thereof are due and payable on February 25, 2014. Melvin Schlossberg, the former President, Chief Executive Officer and Director of the Company, is the father-in-law of one the lenders, Corie Weisblum.
The Company executed a promissory note to Alpha Capital in the amount of $5,000 with 5% interest accruing as of December 10, 2012. The note is due and payable on December 10, 2013.
Going Concern Consideration
As reflected in the accompanying financial statements, the Company has a net loss of $39,446 and net cash used in operations of $21,473 for the year ended December 31, 2012. The Company also had a working capital deficit of $25,412 and a stockholders’ deficit of $41,194 at December 31, 2012. The Company is in the development stage and has not generated revenue since inception. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
The ability of the Company to continue as a going concern is dependent on management's plans, which include entering into a new business, potential asset acquisitions, mergers or business combinations with other entities, further implementation of its business plan and continuing to raise funds through debt or equity raises. The Company will likely rely upon related party debt or equity financing in order to ensure the continuing existence of the business.
9
The accompanying audited interim 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 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.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Not Applicable.
10
The following financial statements are filed as part of this Annual report on Form 10-K:
Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
(A Development Stage Company)
Financial Statements
December 31, 2012 and 2011
CONTENTS
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BERMAN & COMPANY, P.A.
Certified Public Accountants and Consultants
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors:
Point Capital, Inc.
We have audited the accompanying balance sheets of Point Capital, Inc., (a development stage company) as of December 31, 2012 and 2011, and the related statements of operations, stockholders' equity (deficit) and cash flows for the years then ended, and from July 13, 2010 (inception) to December 31, 2012. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Point Capital, Inc. as of December 31, 2012 and 2011, and the results of its operations and its cash flows for the years then ended, and from July 13, 2010 (inception) to December 31, 2012, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has a net loss of $39,446 and net cash used in operations of $21,473 for the year ended December 31, 2012; and has a working capital deficit of $25,412, and a stockholders' deficit of $41,194 at December 31, 2012. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management's plan in regards to these matters is also described in Note 2.
Berman & Company, P.A.
Boca Raton, Florida
February 12, 2013
551 NW 77th Street Suite 201 ● Boca Raton, FL 33487
Phone: (561) 864-4444 ● Fax: (561) 892-3715
www.bermancpas.com● info@bermancpas.com
Registered with the PCAOB ● Member AICPA Center for Audit Quality
Member American Institute of Certified Public Accountants
Member Florida Institute of Certified Public Accountants
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Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
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(A Development Stage Company)
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December 31, 2012
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December 31, 2011
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Assets
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Current Assets
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Cash
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$ | 279 | $ | 1,752 | ||||
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Total Current Assets
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279 | 1,752 | ||||||
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Total Assets
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$ | 279 | $ | 1,752 | ||||
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Liabilities and Stockholders' Deficit
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Current Liabilities
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Accounts payable and accrued expenses
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$ | 20,691 | $ | 3,500 | ||||
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Notes payable
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5,000 | - | ||||||
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Total Current Liabilities
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25,691 | 3,500 | ||||||
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Long Term Liabilities
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Notes payable
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15,000 | - | ||||||
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Interest Payable
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782 | - | ||||||
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Total Long Term Liabilities
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15,782 | - | ||||||
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Total Liabilities
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41,473 | 3,500 | ||||||
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Stockholders' Deficit
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Preferred stock, $0.0001 par value, 5,000,000 shares authorized;
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none issued and outstanding
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$ | - | $ | - | ||||
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Common stock, $0.0001 par value, 100,000,000 shares authorized;
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30,631,200 shares issued and outstanding
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3,063 | 3,063 | ||||||
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Additional paid-in capital
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1,123,497 | 1,123,497 | ||||||
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Deficit accumulated during the development stage
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(1,167,754 | ) | (1,128,308 | ) | ||||
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Total Stockholders' Deficit
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(41,194 | ) | (1,748 | ) | ||||
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Total Liabilities and Stockholders' Deficit
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$ | 279 | $ | 1,752 | ||||
See accompanying notes to financial statements
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Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
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(A Development Stage Company)
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July 13, 2010
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Year Ended December 31,
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(Inception) to
December 31,
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2012
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2011
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2012
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General and administrative expenses
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$ | 39,446 | $ | 49,803 | $ | 1,167,754 | ||||||
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Net loss
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$ | (39,446 | ) | $ | (49,803 | ) | $ | (1,167,754 | ) | |||
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Net loss per common share - basic and diluted
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$ | (0.00 | ) | $ | (0.00 | ) | $ | (0.04 | ) | |||
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Weighted average number of common shares outstanding
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during the period - basic and diluted
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30,631,200 | 30,631,200 | 30,446,456 | |||||||||
See accompanying notes to financial statements
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Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
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(A Development Stage Company)
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Statement of Stockholders' Equity (Deficit)
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Years ended December 31, 2012 and 2011 and from July 13, 2010 (Inception) to December 31, 2012
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Preferred Stock, $0.0001
Par Value
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Common Stock, $0.0001
Par Value
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Additional
Paid In
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Deficit
Accumulated during
Development
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Subscription
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Total
Stockholder's
Equity
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Shares
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Amount
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Shares
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Amount
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Capital
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Stage
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Receivable
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(Deficit)
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Stock issued for services - related parties ($0.05/share)
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- | $ | - | 21,500,000 | $ | 2,150 | $ | 1,072,850 | $ | - | $ | - | $ | 1,075,000 | ||||||||||||||||||
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Stock issued for cash ($0.005 - $0.05/share)
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- | - | 9,131,200 | 913 | 50,647 | - | (575 | ) | 50,985 | |||||||||||||||||||||||
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Net loss - from July 13, 2010 (inception) to December 31, 2010
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- | - | - | - | - | (1,078,505 | ) | - | (1,078,505 | ) | ||||||||||||||||||||||
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Balance - December 31, 2010
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- | - | 30,631,200 | 3,063 | 1,123,497 | (1,078,505 | ) | (575 | ) | 47,480 | ||||||||||||||||||||||
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Receipt of subscription receivable
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- | - | - | - | - | - | 575 | 575 | ||||||||||||||||||||||||
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Net loss - year ended December 31, 2011
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- | - | - | - | - | (49,803 | ) | - | (49,803 | ) | ||||||||||||||||||||||
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Balance - December 31, 2011
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- | - | 30,631,200 | 3,063 | 1,123,497 | (1,128,308 | ) | - | (1,748 | ) | ||||||||||||||||||||||
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Net loss - year ended December 31, 2012
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- | - | - | - | - | (39,446 | ) | - | (39,446 | ) | ||||||||||||||||||||||
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Balance - December 31, 2012
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- | $ | - | 30,631,200 | $ | 3,063 | $ | 1,123,497 | $ | (1,167,754 | ) | $ | - | $ | (41,194 | ) | ||||||||||||||||
See accompanying notes to financial statements
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Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
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(A Development Stage Company)
|
||||||||||||
|
Year Ended December 31,
|
July 13, 2010 (Inception) to
December 31,
|
|||||||||||
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
2012
|
2011
|
2012
|
|||||||||
|
Net loss
|
$ | (39,446 | ) | $ | (49,803 | ) | (1,167,754 | ) | ||||
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||||||
|
Stock issued for services - related parties
|
- | - | 1,075,000 | |||||||||
|
Increase in accounts payable and accrued expenses
|
17,973 | 3,500 | 21,473 | |||||||||
|
Net Cash Used In Operating Activities
|
(21,473 | ) | (46,303 | ) | (71,281 | ) | ||||||
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||||
|
Proceeds from notes payable
|
20,000 | - | 20,000 | |||||||||
|
Proceeds from issuance of common stock
|
- | 575 | 51,560 | |||||||||
|
Net Cash Provided By Financing Activities
|
20,000 | 575 | 71,560 | |||||||||
|
Net Increase (Decrease) in Cash
|
(1,473 | ) | (45,728 | ) | 279 | |||||||
|
Cash - Beginning of Year/Period
|
1,752 | 47,480 | - | |||||||||
|
Cash - End of Year/Period
|
$ | 279 | $ | 1,752 | 279 | |||||||
|
Supplemental Disclosure of Cash Flow Information:
|
||||||||||||
|
Cash Paid During the Year/Period for:
|
||||||||||||
|
Income Taxes
|
$ | - | $ | - | - | |||||||
|
Interest
|
$ | - | $ | - | - | |||||||
See accompanying notes to financial statements
16
Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
(A Development Stage Company)
December 31, 2012 and 2011
Note 1 Nature of Operations and Summary of Significant Accounting Policies
Nature of Operations and Change in Business
Gold Swap Inc. (the “Company”), was incorporated in the State of New York on July 13, 2010.
The Company intended to purchase precious metals and second-hand jewelry for refining and resale. The Company had not clearly identified how it would operate its business, only that it would explore commercial feasibility.
On January 24, 2013, the merger of Point Capital, Inc., an inactive Delaware corporation, with Gold Swap, Inc., a New York corporation, became effective. As a result, (a) Gold Swap’s state of incorporation changed from New York to Delaware and (b) the name of the company changed from “Gold Swap Inc.” to “Point Capital, Inc.”
Currently the Company is exploring new business opportunities and is considering becoming a Business Development Company.
Development Stage
The Company's financial statements are presented as those of a development stage enterprise. Activities during the development stage primarily include equity based financing and further implementation of the business plan.
Risks and Uncertainties
The Company's operations will be subject to significant risk and uncertainties including financial, operational, technological, regulatory and other risks associated with a development stage company, including the potential risk of business failure.
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 disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.
● estimated fair value of share based payments; and
● estimated 100% valuation allowance for deferred tax assets, due to continuing and expected future losses
17
Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
(A Development Stage Company)
Notes to Financial Statements
December 31, 2012 and 2011
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 confirming events. Accordingly, the actual results could differ significantly from estimates.
Cash and Cash Equivalents
The Company considers all highly liquid instruments purchased with a maturity of three months or less and money market accounts to be cash equivalents. The Company had no cash equivalents at December 31, 2012 and 2011, respectively.
Share Based Payments
Generally, all forms of share-based payments, including stock option grants, warrants, restricted stock grants and stock appreciation rights, are measured at their fair value on the awards’ grant date, and based on the estimated number of awards that are ultimately expected to vest. 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 expense resulting from share-based payments are recorded as a component of general and administrative expense.
Earnings per Share
In accordance with accounting guidance now codified as FASB ASC Topic 260, “Earnings per Share,” basic earnings (loss) per share is 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.
Since the Company reflected a net loss in 2012 and 2011, the effect of considering any common stock equivalents, if outstanding, would have been anti-dilutive. A separate computation of diluted earnings (loss) per share is not presented.
Income Taxes
The Company accounts for income taxes in accordance with accounting guidance now codified as FASB ASC Topic 740, “Income Taxes,” which requires that the Company recognize deferred tax liabilities and assets based on the differences between the financial statement carrying amounts and the tax basis of assets and liabilities, using enacted tax rates in effect in the years the differences are expected to reverse. Deferred income tax benefit (expense) results from the change in net deferred tax assets or deferred tax liabilities. A valuation allowance is recorded when it is more likely than not that some or all deferred tax assets will not be realized.
18
Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
(A Development Stage Company)
Notes to Financial Statements
December 31, 2012 and 2011
Accounting guidance now codified as FASB ASC Topic 740-20, “Income Taxes – Intraperiod Tax Allocation,” clarifies the accounting for uncertainties in income taxes recognized in accordance with FASB ASC Topic 740-20 by prescribing guidance for the recognition, de-recognition and measurement in financial statements of income tax positions taken in previously filed tax returns or tax positions expected to be taken in tax returns, including a decision whether to file or not to file in a particular jurisdiction. FASB ASC Topic 740-20 requires that any liability created for unrecognized tax benefits is disclosed. The application of FASB ASC Topic 740-20 may also affect the tax bases of assets and liabilities and therefore may change or create deferred tax liabilities or assets. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense.
At December 31, 2012 and 2011, the Company did not record any liabilities for uncertain tax positions.
Recent Accounting Pronouncements
There are no new accounting pronouncements that have any impact on the Company’s financial statements.
Note 2 Going Concern
As reflected in the accompanying financial statements, the Company has a net loss of $39,446 and net cash used in operations of $21,473 for the year ended December 31, 2012. The Company also had a working capital deficit of $25,412 and a stockholders’ deficit of $41,194 at December 31, 2012. The Company is in the development stage and has not generated revenue since inception. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
The ability of the Company to continue as a going concern is dependent on Management's plans, which include potential asset acquisitions, mergers or business combinations with other entities, further implementation of its business plan and continuing to raise funds through debt or equity raises. The Company will likely rely upon related party debt or equity financing in order to ensure the continuing existence of the business.
The accompanying 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 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.
19
Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
(A Development Stage Company)
Notes to Financial Statements
December 31, 2012 and 2011
Note 3 Income Taxes
The Company recognized deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carryforwards. The Company will establish a valuation allowance to reflect the likelihood of realization of deferred tax assets.
The Company has a net operating loss carryforward of approximately $93,000 at December 31, 2012, expiring through 2032. Internal Revenue Code Section 382 places a limitation on the amount of taxable income that can be offset by carryforwards after a change in control (generally greater than a 50% change in ownership).
Significant deferred tax assets at December 31, 2012 and 2011 are approximately as follows:
| 2012 | 2011 | |||||||
|
Gross deferred tax assets:
|
||||||||
|
Net operating loss carryforwards
|
$ | (36,000 | ) | $ | (21,000 | ) | ||
|
Total deferred tax assets
|
36,000 | 21,000 | ||||||
|
Less: valuation allowance
|
(36,000 | ) | (21,000 | ) | ||||
|
Net deferred tax asset recorded
|
$ | - | $ | - | ||||
The valuation allowance at December 31, 2011 was $21,000. The net change in valuation allowance during the period ended December 31, 2012, was an increase of approximately $15,000.
In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on consideration of these items, management has determined that enough uncertainty exists relative to the realization of the deferred income tax asset balances to warrant the application of a full valuation allowance as of December 31, 2012.
20
Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
(A Development Stage Company)
Notes to Financial Statements
December 31, 2012 and 2011
The actual tax benefit differs from the expected tax benefit for the period ended December 31, 2012 (computed by applying the U.S. Federal Corporate tax rate of 34% to income before taxes and 7.1% for State income taxes, a blended rate of 38.69%) as follows:
| 2012 | 2011 | |||||||
|
Expected tax expense (benefit) - Federal
|
$ |
(12,000
|
) | $ | (16,000 | ) | ||
|
Expected tax expense (benefit) – State
|
(3,000 | ) | (4,000 | ) | ||||
|
Change in valuation allowance
|
15,000 | 20,000 | ||||||
|
Actual tax expense (benefit)
|
$ | - | $ | - |
Note 4 Fair Value
The Company applies the accounting guidance under Financial Accounting Standards Board (“FASB”) ASC 820-10, “Fair Value Measurements”, as well as certain related FASB staff positions. This guidance defines fair value as the price that would be received from m selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact business and considers assumptions that marketplace participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.
The guidance also establishes a fair value hierarchy for measurements of fair value as follows:
|
●
|
Level 1 – quoted market prices in active markets for identical assets or liabilities.
|
|
●
|
Level 2 - inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
|
|
●
|
Level 3 – unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
|
The carrying amounts of the Company’s short-term financial instruments, including accounts payable and accrued expenses and notes payable, approximate fair value due to the relatively short period to maturity for these instruments.
At December 31, 2012 and 2011, the Company has no instruments that require additional disclosure.
21
Point Capital, Inc.
(Formerly Known As Gold Swap Inc.)
(A Development Stage Company)
Notes to Financial Statements
December 31, 2012 and 2011
Note 5 Notes Payable
During February 2012, the Company executed notes payable for $15,000. The notes bear interest at 6%, default interest at 12% and are unsecured. The notes were amended in April 2012 to provide that all the notes are due and payable February 2014. These notes are classified as long term liabilities.
During December 2012, the Company executed notes payable for $5,000. The notes bear interest at 5% and are unsecured. The notes are due and payable December 2013. These notes are classified as short term liabilities.
Note 6 Stockholders’ Equity (Deficit)
From July 13, 2010 (inception) to December 31, 2010, the Company issued the following shares:
|
Type
|
Quantity
|
Valuation
|
Value per share
|
|||||||||
|
Services - related parties
|
21,500,000 | $ | 1,075,000 | $ | 0.0500 | |||||||
|
Cash
|
9,131,200 | 51,560 | $ | 0.005 - $0.05 | ||||||||
|
Total
|
30,631,200 | $ | 1,126,560 | |||||||||
In connection with stock issued for services, the Company determined fair value based upon recent cash offerings with third parties, which was the most readily available evidence.
22
None.
Evaluation of Disclosure Controls and Procedures
We conducted an evaluation under the supervision of the Chief Executive Officer and Chief Financial Officer (its principal executive officer and principal financial officer, respectively), regarding the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act) as of December 31, 2012. Based on the aforementioned evaluation, management has concluded that our disclosure controls and procedures were effective as of December 31, 2012.
Management's Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financial reporting has been 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 generally accepted in the United States of America.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. 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.
Our management, including our chief executive officer and chief financial officer, assessed the effectiveness of our internal control over financial reporting at December 31, 2012. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework. Based on that assessment under those criteria, management has determined that, as of December 31, 2012, our internal control over financial reporting was effective.
23
This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to the exemption provided to issuers that are not “large accelerated filers” nor “accelerated filers” under the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
None.
PART III
Set forth below are the names, ages and present principal occupations or employment, and material occupations, positions, offices or employments for the past five years of our current directors and executive officers.
|
Name and Business Address
|
Age
|
Position
|
||
|
Richard A. Brand
|
56
|
Chairman, Chief Executive Officer and Director
|
||
|
Eric Weisblum
|
43
|
President and Director
|
||
|
Vadim Mats
|
28
|
Chief Financial Officer
|
||
|
Van E. Parker
|
65
|
Director
|
Richard A. Brand, Chairman, CEO and Director, has been a consultant to the Whalehaven Group of Funds since October 2011. From June 2010 until October 2011, Mr. Brand was a registered representative with Andrews Securities where his responsibilities included acting as dealer manager for Keating Capital, Inc. (Nasdaq: KIPO), a business development company. From December 2009 through May 2010, Mr. Brand was a Council Member at Gerson Lehrman Group and Advisory Council Member at Global Capital Service Group, Ltd. From March 2007 until November 2009, Mr. Brand was a sector head and investment committee member at the Yorkville Advisor, an investment advisory firm. From October 2004 to February 2007, Mr. Brand worked at Prospect Capital, Inc. (Nasdaq: PSEC), a business development company, where he held various positions, culminating in head of originations. Mr. Brand holds a Masters of Business Administration from the University of Chicago and the Series 7 - General Securities Representative, and the Series 63 - Uniform Securities Agent State Law Examination securities registrations. He is a Member, Global Association of Risk Professionals.
24
Eric Weisblum, President and Director, co-founded Whalehaven Capital in 2003. Mr. Weisblum is currently a Partner of Whalehaven Capital’s General Partner and Managing Member of JAWS Capital Partners, LLC. From 2002 to 2003, Mr. Weisblum was a registered representative with Domestic Securities, a New Jersey-based broker dealer. While with Domestic Securities, Mr. Weisblum held the Series 7 - General Securities Representative, the Series 63 – Uniform Securities Agent State Law Examination, and the Series 55 – Registered Equity Trader securities registrations. From 1993 to 2002, Mr. Weisblum originated, structured, traded, and placed structured financing transactions at M.H. Meyerson & Co. Inc., a publicly traded registered investment bank. Mr. Weisblum holds a Bachelor of Arts degree from the University of Hartford’s Barney Business School.
Vadim Mats, Chief Financial Officer, has been the Chief Financial Officer of Whalehaven Capital since June 2010 and Chief Financial Officer of JAWS Capital Partners, LLC since March 2011. From July 2007 to December 2009, Mr. Mats was an Assistant Controller at Eton Park Capital Management. From June 2007 to July 2007, Mr. Mats was Senior Fund Accountant of Bank of New York. He holds a Bachelor of Business Administration degree, Cum Laude from City University of New York – Baruch College – Zicklin School of Business. Mr. Mats is currently pursuing a Master of Science degree, Accounting and Finance from City University of New York – Baruch College – Zicklin School of Business.
Van E. Parker, Director, has been the chief executive officer and executive director of Milford Fine Arts Council since August 2012. From June 2010 through August 2012 he was the development director and financial advisor to the Transportation Association of Greenwich, Inc. Mr. Parker was senior advisor to Centre Capital Advisors, LLC from 2007 through February 2011. In 2009 through 2010 Mr. Parker was an advisor to the chief executive officer of the Institute for Advanced Science and Engineering and from March 2008 through May 2009 he was chief development officer at St. Luke's Life Works, Mr. Parker was a board member and chairman of the audit committee of Prospect Capital Corp. from 2004 through 2008 Mr. Parker earned a Bachelor of Arts degree in political science at Colgate University and a MBA from the Graduate School of Business at Columbia University. He is a graduate of the Xerox Advanced Management School. Mr. Parker holds FINRA Series 62, 63 and 79 securities licenses.
There are no familial relationships among any of our officers or directors. None of our directors or officers is a director in any other reporting companies. None of our directors or officers has been affiliated with any company that has filed for bankruptcy within the last ten years. The Company is not aware of any proceedings to which any of the Company’s officers or directors, or any associate of any such officer or director, is a party adverse to the Company or has a material interest adverse to it.
25
There are no legal proceedings that have occurred within the past ten years concerning our directors, or control persons which involved a criminal conviction, a criminal proceeding, an administrative or civil proceeding limiting one's participation in the securities or banking industries, or a finding of securities or commodities law violations.
Each director of the Company serves for a term of one year or until the successor is elected at the Company's annual shareholders' meeting and is qualified, subject to removal by the Company's shareholders. Each officer serves, at the pleasure of the board of directors, for a term of one year and until the successor is elected at the annual meeting of the board of directors and is qualified.
Auditors; Code of Ethics; Financial Expert
Our independent registered public accounting firm is Berman & Company, P.A.
We do not currently have a Code of Ethics applicable to our principal executive, financial and accounting officers. We do not have a “financial expert” on the board or an audit committee or nominating committee.
Potential Conflicts of Interest
Since we do not have an audit or compensation committee comprised of independent directors, the functions that would have been performed by such committees are performed by our directors. Thus, there is a potential conflict of interest in that our directors and officers have the authority to determine issues concerning management compensation and audit issues that may affect management decisions. We are not aware of any other conflicts of interest with any of our executives or directors.
Director Independence
We are not subject to listing requirements of any national securities exchange or national securities association and, as a result, we are not at this time required to have our board comprised of a majority of “independent directors.” We do not believe that any of our directors currently meet the definition of “independent” as promulgated by the rules and regulations of the American Stock Exchange.
Section 16(a) Beneficial Ownership Reporting Compliance
Since our securities have been registered pursuant to Section 12(b) or 12(g) of the Exchange Act of 1934, our officers and directors and persons who own more than 10% of our common stock have filed Section 16(a) beneficial ownership reports. Since none of our securities have been registered pursuant to
26
Summary Compensation Table
|
Name and
principal
position
(a)
|
Year
(1) (b)
|
Salary
($) (c)
|
Bonus
($) (d)
|
Stock
Awards
($) (e)
|
Option Awards
($) (f)
|
Non-Equity Incentive Plan Compensation ($) (g)
|
Nonqualified Deferred Compensation Earnings
($) (h)
|
All Other Compensation ($) (i)
|
Total
($) (j)
|
|||||||||||||||||||||||||
|
Melvin Schlossberg
(President, Chief Executive Officer and Secretary) |
2012
|
0
|
0
|
0
|
(1)
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||||||||
|
2011
|
0
|
0
|
0
|
0
|
||||||||||||||||||||||||||||||
|
Donald Ptalis
(Chief Financial Officer) |
2012
|
0
|
0
|
0
|
(2)
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||||||||
|
2011
|
0
|
0
|
||||||||||||||||||||||||||||||||
|
Vadim Mats
(VP of Business Development) |
2012
|
0
|
0
|
0
|
(3)
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||||||||
|
2011
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||||||||||
|
(1)
|
On July 20, 2010, Mr. Schlossberg was issued 20,000,000 shares of our common stock in consideration for his services as an officer to the Company, valued in the amount of $1,000,000.
|
|
(2)
|
On July 20, 2010, Mr. Ptalis was issued 500,000 shares of our common stock in consideration for his services as an officer of the Company, valued in the amount of $25,000.
|
|
(3)
|
Mr. Mats was issued 1,000,000 shares of our common stock in consideration for his services as an officer of the Company, valued in the amount of $50,000.
|
27
Since our incorporation on July 13, 2010 until his resignation on January 28, 2013, Melvin Schlossberg had been our Chairman, President, Chief Executive Officer, Secretary and a director. We had no formal employment or consulting agreement with Mr. Schlossberg. During the period from July 13, 2010 (inception) to December 31, 2010, Mr. Schlossberg was issued 20,000,000 shares of our common stock in consideration for his services as an officer to the Company, valued in the amount of $1,000,000.
Since July 20, 2010 until his resignation on January 28, 2013, Donald Ptalis had been our Chief Financial Officer and a director. We had no formal employment or consulting agreement with Mr. Ptalis. During the period from July 13, 2010 (inception) to December 31, 2010, Mr. Ptalis was issued 500,000 shares of our common stock in consideration for his services as an officer of the Company, valued in the amount of $25,000.
Since July 20, 2010 until January 28, 2013, Vadim Mats had been our Vice President of Business Development. On January 28, 2013 Mr. Mats was appointed Chief Financial Officer. We had no formal employment or consulting agreement with Mr. Mats. During the period from July 13, 2010 (inception) to December 31, 2010, Mr. Mats was issued 1,000,000 shares of our common stock in consideration for his services as an officer of the Company, valued in the amount of $50,000.
Since our incorporation on July 13, 2010, no stock options or stock appreciation rights were granted to any of our directors or executive officers, none of our directors or executive officers exercised any stock options or stock appreciation rights, and none of them hold unexercised stock options. We have no long-term incentive plans.
Outstanding Equity Awards
Our directors and officers do not have unexercised options, stock that has not vested, or equity incentive plan awards.
Compensation of Directors
During the period from July 13, 2010 (inception) to December 31, 2012, none of our directors received compensation for services rendered in their capacity as a director. However, they were compensated for services rendered in their capacities as officers of the Company.
No arrangements are presently in place regarding compensation to directors for their services as directors or for committee participation or special assignments.
28
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table lists, as of February 26, 2013, the number of shares of common stock of our Company that are beneficially owned by (i) each person or entity known to our Company to be the beneficial owner of more than 5% of the outstanding common stock; (ii) each officer and director of our Company; and (iii) all officers and directors as a group. Information relating to beneficial ownership of common stock by our principal shareholders and management is based upon information furnished by each person using “beneficial ownership” concepts under the rules of the Securities and Exchange Commission. Under these rules, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or direct the voting of the security, or investment power, which includes the power to vote or direct the voting of the security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Under the Securities and Exchange Commission rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which he or she may not have any pecuniary beneficial interest. Except as noted below, each person has sole voting and investment power.
The percentages below are calculated based on 30,631,200 shares of our common stock issued and outstanding as of February 26, 2013. We do not have any outstanding options, warrants or other securities exercisable for or convertible into shares of our common stock. Unless otherwise indicated, the address of each person listed is c/o Point Capital, Inc., c/o Mr. Richard Brand, 285 Grand Avenue, Building 5, Englewood, NJ 07631
|
Name of Beneficial Owner
|
Title Of Class
|
Amount and Nature of Beneficial Ownership
|
Percent of Class
|
|||
|
Melvin Schlossberg
|
Common
|
20,000,000
|
65.3%
|
|||
|
Richard A. Brand
|
Common
|
0
|
0
|
|||
|
Eric Weisblum
|
Common
|
0
|
0
|
|||
|
Van E. Parker
|
Common
|
0
|
0
|
|||
|
Vadim Mats
|
Common
|
0
|
0
|
|||
|
Whalehaven Capital Fund Limited(1)
|
Common
|
5,519,700
|
18.0%
|
|||
|
Directors and Officers as a group (4 persons)
|
20,500,000
|
66.9%
|
(1) Michael Finkelstein has voting and dispositive power as to the shares held by Whalehaven Capital Fund Limited.
29
On February 10, 2012, Whalehaven Capital Fund Limited, a Bermuda corporation (“Whalehaven”) purchased 1,500,000 shares of the Company’s common stock from Lifeline Industries Inc. for a purchase price of $15,000. On June 21, 2012, Corie Weisblum contributed 1,519,700 shares of the Company’s common stock to Whalehaven. On September 27, 2012, Efrat Finkelstein contributed 1,500,000 shares of the Company’s common stock to Whalehaven. On November 29, 2012, Vadim Mats contributed 1,000,000 shares of the Company’s common stock to Whalehaven.
On July 13, 2010, we issued 1,500,000 shares of our common stock to Mrs. Corie Weisblum. These shares were issued in exchange for $$7,500. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended. Mrs. Weisblum is founder of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.
On July 13, 2010, we issued 1,500,000 shares of our common stock to Mrs. Efrat Finkelstein. These shares were issued in exchange for $7,500. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended. Mrs. Finkelstein is founder of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.
On July 13, 2010, we issued 1,500,000 shares of our common stock to Osher Capital Inc., a New York corporation, in which Mr. Arie Kluger is the controlling shareholder. These shares were issued in exchange for $7,500. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended. Mr. Kluger is a founder of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.
30
On July 13, 2010, we issued 1,500,000 shares of our common stock to Lifeline Industries, Inc., New York corporation in which Robb Knie is the sole officer and controlling shareholder. These shares were issued in exchange for $7,500. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended. Mr. Knie is a founder of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.
On July 13, 2010, we issued 1,500,000 shares of our common stock to DPIT1 LLC, a Nevada limited liability company in which Samuel DelPresto is the sole officer and controlling person. These shares were issued in exchange for $7,500. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended. Mr. DelPresto is a founder of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.
On July 13, 2010, we issued 1,500,000 shares of our common stock to Momona Capital LLC, a New York limited liability company in which Arie Rabinowitz is the sole officer and controlling person. These shares were issued in exchange for $7,500. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended. Mr. Rabinowitz is a founder of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.
On July 20, 2010, we issued 1,000,000 shares of our common stock to Vadim Mats. These shares were issued in exchange for services rendered as an officer of the Company, valued in the amount of $50,000. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended. Mr. Mats is an officer of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.
On July 20, 2010, we issued 20,000,000 shares of our common stock to Melvin Schlossberg. These shares were issued in exchange for services rendered as an officer of the Company, valued in the amount of $1,000,000. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended. Mr. Schlossberg was an officer and director of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.
On July 20, 2010, we issued 500,000 shares of our common stock to Donald Ptalis. These shares were issued in exchange for services rendered as an officer of the Company, valued in the amount of $25,000. The shares were issued under Section 4(2) of the Securities Act of 1933, as amended. Mr. Ptalis was an officer and a director of the Company and had access to all of the information which would be required to be included in a registration statement, and the transaction did not involve a public offering.
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Our board of directors reviews and pre-approves audit and permissible non-audit services performed by our independent registered public accounting firm, Berman & Company, P.A.(“Berman”) as well as the fees for such services to ensure that the provision of such services is compatible with maintaining independence.
Pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and is generally subject to a specific budget. The independent auditors and management are required to periodically report to our board of directors regarding the extent of services provided by the independent auditors in accordance with this pre-approval, and the fees for the services performed to date. Our board of directors may also pre-approve particular services on a case-by-case basis.
The following table shows the fees for services provided by Berman for the years ended December 31, 2012 and 2011:
|
2012
|
2011
|
|||||||
|
Audit Fees (1)
|
$
|
15,000
|
$
|
15,000
|
||||
|
Audit Related Fees
|
-
|
|||||||
|
Tax Fees (tax-related services)
|
$ | 1,000 | $ |
1,000
|
||||
|
All other fees
|
-
|
|||||||
|
Total Fees
|
$
|
16,000
|
$
|
16,000
|
||||
|
(1)
|
Audit fees - these fees relate to the audit of our annual financial statements and the review of our interim quarterly financial statements.
|
All services provided by and all fees paid to Berman were pre-approved by our board of directors. None of the services described above were approved pursuant to the exception provided in Rule 2-01(c)(7)(i)(C) of Regulation S-X promulgated by the SEC.
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PART IV
|
Exhibits
|
Description
|
|
|
3.1
|
Certificate of Incorporation of Gold Swap Inc.(1)
|
|
|
3.2
|
Amendment to Certificate of Incorporation(1)
|
|
|
3.3
|
Bylaws of Gold Swap Inc. (1)
|
|
|
3.4
|
Certificate of Incorporation of Point Capital, Inc. (2)
|
|
|
3.5
|
Bylaws of Point Capital, Inc. (2)
|
|
|
4.1
|
Form of Stock Certificate(1)
|
|
|
10.1
|
Form of Regulation D Subscription Agreement(1)
|
|
|
31.1
|
Rule 13a-14(a) / 15d-14(a) Certification of Chief Executive Officer
|
|
|
31.2
|
Rule 13a-14(a) / 15d-14(a) Certification of Chief Financial Officer
|
|
|
32.1
|
Section 1350 Certifications of Chief Executive Officer
|
|
|
32.2
|
Section 1350 Certification of Chief Financial Officer
|
|
(1)
|
Incorporated by reference to the corresponding exhibit filed with our Registration Statement on Form S-1 on March 30, 2011.
|
|
(2)
|
Incorporated by reference to the corresponding exhibit filed with the Information Statement on Schedule 14C filed with the Securities and Exchange Commission on December 28, 2012.
|
33
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.
|
Point Capital, Inc.
By: /s/ Richard A. Brand
Richard A. Brand
Chairman and Chief Executive Officer
(Principal Executive Officer)
By: /s/ Vadim Mats
Vadim Mats
Chief Financial Officer
(Principal Financial and Accounting Officer)
Date: March 5, 2013
|
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
|
Name
|
Title
|
Date
|
||
|
/s/ Richard A. Brand
|
Chairman, Chief Executive Officer, and Director
|
March 5, 2013
|
||
|
Richard A. Brand
|
(Principal Executive Officer)
|
|||
|
/s/ Vadim Mats
|
Chief Financial Officer
|
March 5, 2013
|
||
|
Vadim Mats
|
(Principal Financial
|
|||
|
and Accounting Officer)
|
||||
|
/s/ Eric Weisblum
|
Director
|
March 5, 2013
|
||
|
Eric Weisblum
|
||||
|
/s/ Van E. Parker
|
Director
|
March 5, 2013
|
||
|
Van E. Parker
|
34