XTRA Bitcoin Inc. - Annual Report: 2009 (Form 10-K)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
xANNUAL REPORT UNDER
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the
fiscal year ended December 31,
2009
¨ TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
Commission
file number: 333-149978
DIAMOND
INFORMATION INSTITUTE, INC.
(Exact
name of registrant as specified in its charter)
New
Jersey
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22-2935867
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(State
or other jurisdiction of incorporation or organization)
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(I.R.S.
Employer Identification No.)
|
2300
W. Sahara Avenue, Suite 800
|
||
Las
Vegas, Nevada
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89102
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|
(Address
of principal executive offices)
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(Zip
Code)
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Issuer’s
telephone number: (888)
840-2646
Securities
registered under Section 12(b) of the Act: None
Securities
registered under Section 12(g) of the Act: None
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes ¨ 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 x No ¨
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 ¨
1
Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§229.405) 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. ¨
Indicate
by check mark whether the registrant a large accelerated filer, an accelerated
filer, a non-accelerated filer, or a small reporting company. See the
definitions of "large accelerated filer," "accelerated filer" and "small
reporting company" in Rule 12b-2 of the Exchange Act.
Large
accelerated filer ¨
|
Accelerated
filer ¨
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Non-accelerated
filer ¨ (Do not check if
a smaller reporting company)
|
Smaller
reporting company x
|
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act). Yes ¨ No x
The
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
sold, or the average bid and asked price of such common equity, as of June 30,
2009 (the last business day of the registrant's most recently completed second
fiscal quarter) was $0.
The
number of shares of Common Stock, $0.001 par value, outstanding on April 12,
2010 was 11,863,100 shares.
2
DIAMOND
INFORMATION INSTITUTE, INC.
FOR
THE FISCAL YEAR ENDED
DECEMBER
31, 2009
Index
to Report
on
Form 10-K
PART
I
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Page
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Item
1.
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Business
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5 |
Item
1A.
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Risk
Factors
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7 |
Item
1B.
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Unresolved
Staff Comments
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11 |
Item
2.
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Properties
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11 |
Item
3.
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Legal
Proceedings
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11 |
Item
4.
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Deleted
and Reserved by Securities and Exchange Commission
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11 |
PART
II
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Item
5.
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Market
for Registrant's Common Equity and Related Stockholder Matters and Issuer
Purchases of Equity Securities
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11 |
Item
6.
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Selected
Financial Data
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13 |
Item
7.
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Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
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13 |
Item
7A.
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Quantitative
and Qualitative Disclosures About Market Risk
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17 |
Item
8.
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Financial
Statements and Supplementary Data
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17 |
Item
9.
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Changes
in and Disagreements With Accountants on Accounting and Financial
Disclosure
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19 |
Item
9A (T)
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Control
and Procedures
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19 |
Item
9B.
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Other
Information
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20 |
PART
III
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Item
10.
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Directors,
Executive Officers and Corporate Governance
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20 |
Item
11.
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Executive
Compensation
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22 |
Item
12.
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Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
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23 |
Item
13.
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Certain
Relationships and Related Transactions, and Director
Independence
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23 |
Item
14
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Principal
Accounting Fees and Services
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25 |
PART
IV
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Item
15.
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Exhibits,
Financial Statement Schedules
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26 |
3
FORWARD-LOOKING
STATEMENTS
This
document contains “forward-looking statements”. All statements other
than statements of historical fact are “forward-looking statements” for purposes
of federal and state securities laws, including, but not limited to, any
projections of earnings, revenue or other financial items; any statements of the
plans, strategies and objections of management for future operations; any
statements concerning proposed new services or developments; any statements
regarding future economic conditions or performance; any statements or belief;
and any statements of assumptions underlying any of the foregoing.
Forward-looking
statements may include the words “may,” “could,” “estimate,” “intend,”
“continue,” “believe,” “expect” or “anticipate” or other similar
words. These forward-looking statements present our estimates and
assumptions only as of the date of this report. Accordingly, readers
are cautioned not to place undue reliance on forward-looking statements, which
speak only as of the dates on which they are made. Except for our
ongoing securities laws, we do not intend, and undertake no obligation, to
update any forward-looking statement. Additionally, the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995 most likely
do not apply to our forward-looking statements as a result of being a penny
stock issuer. You should, however, consult further disclosures we
make in future filings of our Annual Report on Form 10-K, Quarterly Reports on
Form 10-Q and Current Reports on Form 8-K.
Although
we believe the expectations reflected in any of our forward-looking statements
are reasonable, actual results could differ materially from those projected or
assumed in any of our forward-looking statements. Our future
financial condition and results of operations, as well as any forward-looking
statements, are subject to change and inherent risks and
uncertainties. The factors impacting these risks and uncertainties
include, but are not limited to:
·
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our
current lack of working capital;
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·
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increased
competitive pressures from existing competitors and new
entrants;
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·
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increases
in interest rates or our cost of borrowing or default under any material
debt agreements;
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·
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inability
to raise additional financing;
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·
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deterioration
in general or regional economic
conditions;
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·
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adverse
state or federal legislation or regulation that increases the costs of
compliance, or adverse findings by a regulator with respect to existing
operations;
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·
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changes
in U.S. GAAP or in the legal, regulatory and legislative environments in
the markets in which we operate;
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·
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the
fact that our accounting policies and methods are fundamental to how we
report our financial condition and results of operations, and they may
require management to make estimates about matters that are inherently
uncertain;
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·
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inability
to efficiently manage our
operations;
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·
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loss
of customers or sales weakness;
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·
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inability
to achieve future sales levels or other operating
results;
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·
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key
management or other unanticipated personnel
changes;
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·
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the
unavailability of funds for capital expenditures;
and
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·
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operational
inefficiencies in distribution or other
systems.
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4
For
a detailed description of these and other factors that could cause actual
results to differ materially from those expressed in any forward-looking
statement, please see Item 1A, Risk Factors, in this
document.
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Throughout
this Annual Report references to “we”, “our”, “us”, “Diamond”, “the
Company”, and similar terms refer to Diamond Information Institute,
Inc.
|
AVAILABLE
INFORMATION
Our
securities as of September 8, 2008 are registered under the Securities Act of
1933, and we will file reports and other information with the Securities and
Exchange Commission as a result. Additionally, we shall file supplementary and
periodic information, documents and reports that are required under section
13(a) and Section 15(d) of the Exchange Act, as amended.
Any
annual, quarterly, special reports and other information filed with the SEC can
be inspected and copied at the public reference facility maintained by the SEC
at 100 F Street, N.E., Room 1580, Washington, D.C. 20549-0405. Information
regarding the public reference facilities may be obtained from the SEC by
telephoning 1-800-SEC-0330. The Company’s filings are also available through the
SEC’s Electronic Data Gathering Analysis and Retrieval System which is publicly
available through the SEC’s website (www.sec.gov). Copies of such materials may
also be obtained by mail from the public reference section of the SEC at 100 F
Street, N.E., Room 1580, Washington, D.C. 20549-0405 at prescribed
rates.
PART
I
ITEM
1. BUSINESS
General
Business Development
Diamond
Information Institute, Inc. was incorporated in the State of New Jersey in
October of 1988 and had minimal activity until 1995 when it began in the
business of jewelry manufacturing. Diamond has been engaged in the
design and manufacture of upscale jewelry from 1995 through October,
2009. Effective October 19, 2009, as approved at our
shareholder meeting on October 8, 2009, we entered into a Share Exchange
Agreement with Alba Mineral Exploration, Inc. (“Alba”), a Delaware Corporation
(the “Agreement”). Pursuant to the Agreement, Alba agreed to issue
our shareholders a total of 2,585,175 shares of common stock in Alba in
proportion to their holdings in our company. Following the
transaction described in the Agreement and other accompanying transactions, our
shareholders own 60% of the common stock issued and outstanding in
Alba. Also pursuant to the Agreement, Alba acquired all of the assets
and liabilities related to our business. As a result of the transaction the
company became a wholly-owned subsidiary of Alba, and all of our operations
related to the jewelry business we were in were discontinued.
Agreement
for the Purchase of Common Stock and Warrants
Bergio
International, Inc. (the “Seller”) , as record owner or agent representing
11,863,100 shares of common stock of Diamond Information Institute, Inc., a
corporation formed under the laws of the State of New Jersey (the “Company”)
entered into a share purchase agreement dated February 2, 2010 (the “Share
Purchase Agreement”) with Macau Consultants and Advisory Services Inc. (the
“Buyer”). In accordance with the terms and provisions of the
5
Share
Purchase Agreement, the Seller sold an aggregate of 11,863,100 shares of common
stock (the “Common Stock”) of the Corporation to the Buyer in exchange for
$225,000 (the “Purchase Price”). The closing and consummation of the Share
Purchase Agreement occurred March 18, 2010 (the “Closing Date”). The Purchase
Price shall be paid as follows: (i) $50,000 initial deposit, which as of the
date of this Current Report has been paid; (ii) $55,000 within thirty day from
the Closing Date, which is due approximately April 18, 2010; (iii) $60,000
within sixty days from the Closing Date, which is due approximately May 18,
2010; and (iv) $60,000 within ninety days from the Closing Date, which is
approximately June 18, 2010. As of the date of this Current Report,
new officers and directors of the Company have been appointed and the change in
control is being effected. A subsequent current report on Form 8-K will be filed
disclosing beneficial ownership and control of the Company.
Current
Business Operations
The
Company was organized under the laws of the State of New Jersey in October of
1988. Since approximately 1995, the Company had been involved in the business of
designing and manufacturing jewelry under its tradename of the “Bergio” line.
Based upon consummation of the Share Purchase Agreement and the subsequent
change in control of the Company, the business operations of the Company will
change.
The
Company’s business operations will involve embarking upon a project to make
Venture Capital Investments into private and public Companies. The eligible
companies qualifying for an investment from the Company will be companies who
currently have a dynamic business plan and are nearing completion of the
establishment of that business plan or are currently established businesses with
positive cash flow but require additional funding to develop existing markets or
expand into new markets. Emphasis will be on businesses with a very low overhead
and cost of sales thus giving them a large increase in positive cash flow with
the injection of new capital into the company. A specific emphasis of the
Company will be in the Green Energy as well as the renewable energy fields and
the development of Software as a Service (SAAS) sector. The Company will also be
operating a consultancy division to assist existing private companies to go
public as well as assisting companies who are already public to restructure and
raise additional money from the capital markets.
The
Company plans on using consultants to execute its business plan as much as
possible. That way management is able to access the very best in the industry
sectors that the Company will be operating in and the Company will not be
encumbered with considerable expensive overhead when the marketplace becomes
soft as they all do from time to time. Management believes that the Company’s
business model should insulate it from major market downturns since the market
sector the Company will be operating in will be fee based. Management further
believes that when the general market enters a Bear Market phase, there will be
the most demand for the services the Company will be providing. As well the
consultancy side of the Company’s business, the Company will be able to monitor
and assist any companies it invests in to ensure the Company’s investments grow
and mature on a timely basis with as little harm from cycles in the specific
investment sectors that the Company invests in as possible.
6
Management
believes that regardless of whether the Company is in a Bear cycle or a Bull
market run, there will always be a healthy demand for funds and always a need
for business management services to assist those who are floundering. Management
believes that the Company has the best of both worlds since the Company should
prosper from the Bear and Bull Market cycles. The only determinant for the
Company in determining how fast it can grow its business will be in the
Company’s success in obtaining the necessary funds for deployment into good
qualifying business models. Management of the Company looks forward to the
future with great anticipation.
Environmental
Regulation and Compliance
The
United States environmental laws do not materially impact Diamond’s
operations.
Government
Regulation
Currently,
the Company is subject to all of the government regulations that regulate
businesses generally such as compliance with regulatory requirements of federal,
state, and local agencies and authorities, including regulations concerning
workplace safety, labor relations, and disadvantaged
businesses. In addition, the Company’s operations are affected
by federal and state laws relating to marketing practices in the retail jewelry
industry. Diamond is subject to the jurisdiction of federal, various state and
other taxing authorities. From time to time, these taxing authorities
review or audit the Company.
ITEM
1A. RISK
FACTORS
Risks
Relating To Our Planned Business and Marketplace
You
should carefully consider the risks described below and all other information
contained in this annual report on Form 10-K, including financial statements and
the related notes thereto. The risks and uncertainties described below are not
the only risks we face. Additional risks and uncertainties not presently known
to us, or not presently deemed material by us, may also impair our future
operations and performance. If any of the following risks actually occur, our
business, financial condition or results of operations could be materially
adversely affected. If that happens, the trading price of our common stock could
decline, and you may lose all or part of your investment.
Our
business may be adversely affected by the recent financial crisis and our
ability to access the capital markets.
The
global financial markets are in turmoil, and the economies of the U.S. and many
other countries are in recession, which may be severe and prolonged. This status
has resulted in diminished opportunities for liquidity and credit availability,
declines in consumer confidence, declines in economic growth, increases in
unemployment rates, and uncertainty about overall economic stability, and there
can be no assurance against further decline. The end markets for certain of our
portfolio of prosepctive companies’ products and services have experienced, and
continue to experience, negative economic trends. We are unable to predict the
likely duration and severity of this global financial turmoil, and if the
current uncertainty continues or economic conditions further deteriorate, our
business and the businesses of our portfolio companies could be materially and
adversely affected.
7
There is uncertainty regarding the
value of our planned investments in restrictedsecurities.
We may be
required to carry our planned portfolio investments at market value or, if there
is no readily available market value, at fair value as determined by us with our
Board of Directors having final responsibility for overseeing, reviewing and
approving, in good faith, our estimate of fair value. Because of the inherent
uncertainty of the valuation of portfolio securities which do not have readily
ascertainable market values, our fair value determinations may differ materially
from the values a third party would be willing to pay for such securities or the
values which would be applicable to unrestricted securities having a public
market.
The lack of liquidity of
restrictedsecurities may
adversely affect our planned business.
Our
portfolio may contain many securities which are subject to restrictions on sale
because they will have been acquired from issuers in "private placement"
transactions or because we are deemed to be an affiliate of the issuer. Unless
an exemption from the registration requirements of the Securities Act of 1933 is
available, we will not be able to sell these securities publicly without the
expense and time required to register the securities under applicable federal
and state securities laws. In addition, contractual or practical limitations may
restrict our ability to liquidate our securities in planned portfolio companies,
because we may own a relatively large percentage of the issuer’s outstanding
securities. Sales may also be limited by unfavorable market conditions. The
illiquidity of our investments may preclude or delay the disposition of such
securities, which may make it difficult for us to obtain cash equal to the value
at which we record our investments.
There
may be limited publicly available information regarding the companies in which
we are contemplating investment.
It is
possible that some of the securities in our future portfolio may be issued by
privately held companies. Many of the securities in our portfolio are
issued by privately held companies. There is generally little or no publicly
available information about such companies, and we may have to rely on the
diligence of our management to obtain the information necessary for our decision
to invest. There can be no assurance that such diligence efforts will uncover
all material information necessary to make fully informed investment
decisions.
Some of our planned portfolio
companies,may
behighly
leveraged.
Some of
our planned portfolio companies may have incurred substantial indebtedness in
relation to their overall capital base. Such indebtedness often has a term that
will require the balance of the loan to be refinanced when it matures. If these
companies cannot generate adequate cash flow to meet the principal and interest
payments on their indebtedness, the value of our investment in them could be
reduced or eliminated through foreclosure on the portfolio company’s assets or
by the portfolio company’s reorganization or bankruptcy.
Fluctuationsmay occurin our quarterly
results.
8
Our
future quarterly operating results may fluctuate materially due to a number of
factors including, among others, variations in and the timing of the recognition
of realized and unrealized gains or losses, the degree to which we encounter
competition in our planned portfolio companies’ markets, the ability to find and
close suitable investments, and general economic conditions. As a result of
these factors, results for any future period should not be relied upon as being
indicative of performance in future periods.
Our future financial condition and
results of operations will depend on our ability to effectivelymanage any future
growth.
Sustaining
growth will depend upon our ability to identify, evaluate, finance, and invest
in companies that meet our investment criteria. Accomplishing such results on a
cost-effective basis is a function of our marketing capabilities and skillful
management of the investment process. Failure to achieve future growth could
have a material adverse effect on our business, financial condition, and results
of operations.
We will be dependent upon management
for our future success.
Selection,
structuring and closing our investments will depend upon the diligence and skill
of our management, which is responsible for identifying, evaluating,
negotiating, monitoring and disposing of our investments. Our management’s
capabilities may significantly impact our results of operations. If we lose any
member of our management team and he/she cannot be promptly replaced with an
equally capable team member, our results of operations could be significantly
impacted.
We will operate in a highly
competitive market for investment opportunities.
We will
compete for attractive investment opportunities with private equity funds,
venture capital partnerships and corporations, venture capital affiliates of
industrial and financial companies, SBICs and wealthy individuals. Some of these
competitors will be substantially larger and have greater financial resources,
and some are subject to different and frequently less stringent regulation. As a
result of this competition, we may not be able to take advantage of attractive
investment opportunities from time to time and there can be no assurance that we
will be able to identify and make investments that satisfy our
objectives.
Changes in laws or regulations
governing our operations or our failure to comply with those laws or regulations
may adversely affect our business.
We and
our planned portfolio companies are subject to regulation by laws at the local,
state and federal level. These laws and regulations, as well as their
interpretation, may be changed from time to time. Accordingly, any changes in
these laws and regulations or failure to comply with them could have a material
adverse effect on our business.
Failure to deploy new capital may
reduce our return on equity.
If we
fail to invest our capital effectively, our return on equity may be decreased,
which could reduce the price of the shares of our common
stock.
9
The market price of our common stock
may fluctuate significantly.
The
market price and marketability of shares of our common stock may from time to
time be significantly affected by numerous factors, including our investment
results, market conditions, and other influences and events over which we have
no control and that may not be directly related to us.
Risks
Relating to our Common Stock
If
we fail to remain current on our reporting requirements, we could be removed
from the OTC Bulletin Board which would limit the ability of broker-dealers to
sell our securities and the ability of stockholders to sell their securities in
the secondary market.
Companies
trading on the OTC Bulletin Board, such as us, must be reporting issuers under
Section 12 of the Securities Exchange Act of 1934, as amended, and must be
current in their reports under Section 13, in order to maintain price quotation
privileges on the OTC Bulletin Board. More specifically, the
Financial Industry Regulatory Authority (“FINRA”) has enacted Rule 6530, which
determines eligibility of issuers quoted on the OTC Bulletin Board by requiring
an issuer to be current in its filings with the Commission. Pursuant
to Rule 6530(e), if we file our reports late with the Commission three times in
a two-year period or our securities are removed from the OTC Bulletin Board for
failure to timely file twice in a two-year period then we will be ineligible for
quotation on the OTC Bulletin Board. As a result, the market
liquidity for our securities could be severely adversely affected by limiting
the ability of broker-dealers to sell our securities and the ability of
stockholders to sell their securities in the secondary market. We
have not been late in any of our SEC reports through December 31,
2009.
Our
common stock could be deemed a low-priced “Penny” stock which could make it
cumbersome for brokers and dealers to trade in our common stock, making the
market for our common stock less liquid and negatively affect the price of our
stock.
In the
event where our securities are accepted for trading in the over-the-counter
market, trading of our common stock may be subject to certain provisions of the
Securities Exchange act of 1934, commonly referred to as the “penny stock” as
defined in Rule 3a51-1. A penny stock is generally defined to be any
equity security that has a market price less than $5.00 per share, subject to
certain exceptions. If our stock is deemed to be a penny stock,
trading will be subject to additional sales practice requirements of
broker-dealers. These require a broker-dealer to:
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·
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Deliver
to the customer, and obtain a written receipt for, a disclosure
document;
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·
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Disclose
certain price information about the
stock;
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·
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Disclose
the amount of compensation received by the broker-dealer or any associated
person of the broker-dealer;
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·
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Send
monthly statements to customers with market and price information about
the penny stock; and
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·
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In
some circumstances, approve the purchaser’s account under certain
standards and deliver written statements to the customer with information
specified in the rules.
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Consequently,
penny stock rules may restrict the ability or willingness of
broker-dealers to trade and/or maintain a market in our common
stock. Also, prospective investors may not want to get involved
with the additional administrative requirements, which may have a material
adverse effect on the trading of our
shares.
|
10
FINRA
sales practice requirements may also limit a stockholder's ability to buy and
sell our stock.
In
addition to the “penny stock” rules described above, FINRA has adopted rules
that require that in recommending an investment to a customer, a broker-dealer
must have reasonable grounds for believing that the investment is suitable for
that customer. Prior to recommending speculative low priced securities to their
non-institutional customers, broker-dealers must make reasonable efforts to
obtain information about the customer's financial status, tax status, investment
objectives and other information. Under interpretations of these rules, the
FINRA believes that there is a high probability that speculative low priced
securities will not be suitable for at least some customers. The FINRA
requirements make it more difficult for broker-dealers to recommend that their
customers buy our common stock, which may limit your ability to buy and sell our
stock and have an adverse effect on the market for our shares.
ITEM
1B. UNRESOLVED
STAFF COMMENTS
None.
ITEM
2. PROPERTIES
Currently,
the Company leases office space in a shared executive suite located in Las
Vegas, Nevada on a monthly basis.
ITEM
3. LEGAL
PROCEEDINGS
From time
to time, we may become involved in various lawsuits and legal proceedings which
arise in the ordinary course of business. However, litigation is subject to
inherent uncertainties, and an adverse result in these or other matters may
arise from time to time that may harm our business. We are not presently a party
to any material litigation, nor to the knowledge of management is any litigation
threatened against us, which may materially affect our financial position or
results of operations.
ITEM
4. Deleted
and Reserved by the Securities and Exchange Commission
PART
II
ITEM
5.
|
MARKET
FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS
ISSUER PURCHASE OF EQUITY
SECURITIES
|
Market
Information
During
the year ended December 31, 2008, we filed for inclusion of our common stock on
the Over-the-Counter Bulletin Board (“OTC:BB”). Our Common Stock was
approved for trading by FINRA for trading on the OTC:BB under the symbol DIII on
January 26, 2009. Since being quoted on the OTC:BB, our common stock
has not traded.
11
Holders
of Common Stock
As of
April 12, 2010 we had approximately 10 stockholders of record of the
11,863,100 shares outstanding.
Dividends
The
payment of dividends is subject to the discretion of our Board of Directors and
will depend, among other things, upon our earnings, our capital requirements,
our financial condition, and other relevant factors.
We
currently do not intend to pay cash dividends in the foreseeable future on the
shares of common stock. We intend to reinvest any earnings in the development
and expansion of our business. Any cash dividends in the future to
common stockholders will be payable when, as and if declared by our Board of
Directors, based upon the Board’s assessment of:
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·
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our
financial condition;
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·
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earnings;
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·
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need
for funds;
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·
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capital
requirements;
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·
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prior
claims of preferred stock to the extent issued and outstanding;
and
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·
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other
factors, including any applicable
laws.
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Therefore,
there can be no assurance that any dividends on the common stock will ever
be paid.
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Securities
Authorized for Issuance under Equity Compensation Plans
We
currently do not maintain any equity compensation plans.
Recent
Sales of Unregistered Securities
On
January 30, 2009, we authorized the issuance of 100,000 shares of our common
stock to Stoecklein Law Group pursuant to its retainer agreement for legal
services.
On
February 11, 2009, we authorized the issuance of 50,000 shares of our common
stock to Berge Abajian as compensation for his board services during the 2009
year.
On
February 26, 2009, we authorized the issuance of 20,000 shares of our common
stock to Stoecklein Law Group pursuant to a new retainer agreement for legal
services during the 2009 year.
We
believe that the issuance of the shares was exempt from the registration and
prospectus delivery requirements of the Securities Act of 1933 by virtue of
Section 4(2). The shares were issued directly by us and did not involve a public
offering or general solicitation. The recipients of the shares were afforded an
opportunity for effective access to files and records of our company that
contained the relevant information needed to make their investment
12
decision,
including our financial statements. We reasonably believe that the recipients,
immediately prior to issuing the shares, had such knowledge and experience in
our financial and business matters that they were capable of evaluating the
merits and risks of their investment. The recipients had the
opportunity to speak with our management on several occasions prior to their
investment decision. There were no commissions paid on the issuance of the
shares.
Issuer
Purchases of Equity Securities
We did
not repurchase any of our securities during the year ended December 31,
2009.
ITEM
6. SELECTED
FINANCIAL DATA
Not
applicable.
ITEM
7.
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
OVERVIEW
Diamond
Information Institute, Inc. was incorporated in the State of New Jersey in
October of 1988 and had minimal activity until 1995 when it began in the
business of jewelry manufacturing. Diamond has been engaged in the
design and manufacture of upscale jewelry from 1995 through October,
2009. Effective October 19, 2009, as approved at our
shareholder meeting on October 8, 2009, we entered into a Share Exchange
Agreement with Alba Mineral Exploration, Inc. (“Alba”), a Delaware Corporation
(the “Agreement”). Pursuant to the Agreement, Alba agreed to issue
our shareholders a total of 2,585,175 shares of common stock in Alba in
proportion to their holdings in our company. Following the
transaction described in the Agreement and other accompanying transactions, our
shareholders own 60% of the common stock issued and outstanding in
Alba. Also pursuant to the Agreement, Alba acquired all of the assets
and liabilities related to our business. As a result of the transaction the
company became a wholly-owned subsidiary of Alba, and all of our operations
related to the jewelry business we were in were
discontinued. Based upon consummation of this Share Purchase
Agreement and the subsequent change in control of the Company, the business
operations of the Company will change as follows:
OVERVIEW
OF CURRENT OPERATIONS
The
Company’s business operations will involve embarking upon a project to make
Venture Capital Investments into private and public Companies. Management plans
on obtaining the necessary capital for these venture capital investments via
borrowings and investments into the Company. The eligible companies qualifying
for an investment from the Company will be companies who currently have a
dynamic business plan and are nearing completion of
13
the
establishment of that business plan or are currently established businesses with
positive cash flow but require additional funding to develop existing markets or
expand into new markets. Emphasis will be on businesses with a very low overhead
and cost of sales thus giving them a large increase in positive cash flow with
the injection of new capital into the company. A specific emphasis of the
Company will be in the Green Energy as well as the renewable energy fields and
the development of Software as a Service (SAAS) sector. The Company will also be
operating a consultancy division to assist existing private companies to go
public as well as assisting companies who are already public to restructure and
raise additional money from the capital markets. There are numerous projects
already submitted which are currently being considered for funding.
The
Company plans on using consultants to execute its business plan as much as
possible. That way management is able to access the very best in the industry
sectors that the Company will be operating in and the Company will not be
encumbered with considerable expensive overhead when the marketplace becomes
soft as they all do from time to time. Management believes that the Company’s
business model should insulate it from major market downturns since the market
sector the Company will be operating in will be fee based. Management further
believes that when the general market enters a Bear Market phase, there will be
the most demand for the services the Company will be providing. As well the
consultancy side of the Company’s business, the Company will be able to monitor
and assist any companies it invests in to ensure the Company’s investments grow
and mature on a timely basis with as little harm from cycles in the specific
investment sectors that the Company invests in as possible.
Management
believes that regardless of whether the Company is in a Bear cycle or a Bull
market run, there will always be a healthy demand for funds and always a need
for business management services to assist those who are floundering. Management
believes that the Company has the best of both worlds since the Company should
prosper from the Bear and Bull Market cycles. The only determinant for the
Company in determining how fast it can grow its business will be in the
Company’s success in obtaining the necessary funds for deployment into good
qualifying business models. Management of the Company looks forward to the
future with great anticipation.
Results
of Operations
Based
upon consummation of the Share Purchase Agreement and the subsequent change in
control and business operations, the Company had not yet commenced its planned
business operations. A relevant discussion of operational results is
therefore not available.
Income
Tax (Benefit) Provision
At
December 31, 2009, the Company had approximately $1,600,000 of federal net
operating tax loss carryforwards expiring at various dates through
2029. The Tax Reform Act of 1986 enacted a complex set of rules which
limits a company's ability to utilize net operating loss carryforwards and tax
credit carryforwards in periods following an ownership change. These rules
define an ownership change as a greater than 50 percent change in stock
ownership within a defined testing period which is generally a three-year
period. As a result of stock which may be issued by us from time to time and the
conversion of warrants, options or the result of other changes in ownership of
our outstanding stock, the Company may experience an ownership change and
consequently our utilization of net operating loss carryforwards could be
significantly limited.
14
Expected
purchase or sale of plant and significant equipment.
We do not
anticipate the purchase or sale of any plant or significant equipment; as such
items are not required by us at this time.
Significant
changes in the number of employees.
We
currently have 2 part-time employees. We do not anticipate a
significant change in the number of full time employees over the next 12
months. None of our employees are subject to any collective
bargaining agreements.
Off-Balance
Sheet Arrangements
We do not
have any off-balance sheet arrangements that have or are reasonably likely to
have a current or future effect on our financial condition, results or
operations, liquidity, capital expenditures or capital resources that is deemed
material.
Critical
Accounting Policies
The
Company prepares its financial statements in accordance with accounting
principles generally accepted in the United States of America. Preparing
financial statements in accordance with generally accepted accounting principles
requires the Company to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosures of contingent assets and
liabilities as of the date of the financial statements and the reported amounts
of revenue and expenses during the reported period.
Long-Lived
Assets. In accordance with Statement of Financial Accounting
Standards (“SFAS”) No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets, long-lived tangible assets subject to depreciation or
amortization are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. If an asset is determined to be impaired, the loss is
measured by the excess of the carrying amount of the asset over its fair value
as determined by an estimate of undiscounted future cash flows. As
these factors are difficult to predict and are subject to future events that may
alter management’s assumptions, the future cash flows estimated by management in
their impairment analyses may not be achieved.
Recently
Issued Accounting Standards
On
July 1, 2009, the Accounting Standards Codification (“ASC”) became the
Financial Accounting Standards Board (“FASB”) officially recognized source of
authoritative U.S. generally accepted accounting principles applicable to all
public and non-public non-governmental entities, superseding existing FASB,
AICPA, EITF and related literature. Rules and interpretive releases of the SEC
under the authority of federal securities laws are also sources of authoritative
GAAP for SEC registrants. All other accounting literature is considered
non-authoritative. The switch to the ASC affects the away companies refer to
U.S. GAAP in financial statements and accounting policies. Citing particular
content in the ASC involves specifying the unique numeric path to the content
through the Topic, Subtopic, Section and Paragraph structure.
15
FASB ASC Topic 260, “Earnings Per
Share.” On January 1, 2009, the Company adopted new authoritative
accounting guidance under FASB ASC Topic 260, “Earnings Per Share,” which
provides that unvested share-based payment awards that contain nonforfeitable
rights to dividends or dividend equivalents (whether paid or unpaid) are
participating securities and shall be included in the computation of earnings
per share pursuant to the two-class method.
FASB ASC Topic 820, “Fair Value
Measurements and Disclosures.” New authoritative accounting guidance
under ASC Topic 820,”Fair Value Measurements and Disclosures,” affirms that the
objective of fair value when the market for an asset is not active is the price
that would be received to sell the asset in an orderly transaction, and
clarifies and includes additional factors for determining whether there has been
a significant decrease in market activity for an asset when the market for that
asset is not active. ASC Topic 820 requires an entity to base its conclusion
about whether a transaction was not orderly on the weight of the evidence. The
new accounting guidance amended prior guidance to expand certain disclosure
requirements. The Company adopted the new authoritative accounting guidance
under ASC Topic 820 during the first quarter of 2009. Adoption of the new
guidance did not significantly impact the Company’s consolidated financial
statements.
Further
new authoritative accounting guidance (Accounting Standards Update
No. 2009-5) under ASC Topic 820 provides guidance for measuring the fair
value of a liability in circumstances in which a quoted price in an active
market for the identical liability is not available. In such instances, a
reporting entity is required to measure fair value utilizing a valuation
technique that uses (i) the quoted price of the identical liability when
traded as an asset, (ii) quoted prices for similar liabilities or similar
liabilities when traded as assets, or (iii) another valuation technique
that is consistent with the existing principles of ASC Topic 820, such as an
income approach or market approach. The new authoritative accounting guidance
also clarifies that when estimating the fair value of a liability, a reporting
entity is not required to include a separate input or adjustment to other inputs
relating to the existence of a restriction that prevents the transfer of the
liability. The forgoing new authoritative accounting guidance under ASC Topic
820 will be effective for the Company’s consolidated financial statements
beginning October 1, 2009 and is not expected to have a significant impact
on the Company’s consolidated financial statements.
FASB ASC Topic 825 “Financial
Instruments.” New authoritative accounting guidance under ASC Topic
825,”Financial Instruments,” requires an entity to provide disclosures about the
fair value of financial instruments in interim financial information and amends
prior guidance to require those disclosures in summarized financial information
at interim reporting periods.
FASB ASC
Topic 855, “Subsequent
Events.” New authoritative accounting guidance under ASC Topic 855,
“Subsequent Events,” establishes general standards of accounting for and
disclosure of events that occur after the balance sheet date but before
financial statements are issued or available to be issued. ASC Topic 855 defines
(i) the period after the balance sheet date during which a reporting
entity’s management should evaluate events or transactions that may occur for
potential recognition or disclosure in the financial statements, (ii) the
circumstances under which an entity should recognize events or transactions
occurring after the balance sheet date in its financial statements,
16
and
(iii) the disclosures an entity should make about events or transactions
that occurred after the balance sheet date. The new authoritative accounting
guidance under ASC Topic 855 became effective for the Company’s financial
statements for periods ending after June 15, 2009. Effective February 24,
2010, the FASB issued Accounting Standards Update (“ASU”) No. 2010-09,
“Subsequent Events (Topic 855): Amendments to Certain Recognition and Disclosure
Requirements” which revised certain disclosure requirements. ASU No. 2010-09 did
not have a significant impact on the Company’s consolidated financial
statements. The company
evaluated subsequent events, which are events or transactions that occurred
after December 31, 2009 through the issuance of the accompanying consolidated
financial statements.
Management
does not believe that any other recently issued but not yet effective accounting
pronouncements, if adopted, would have an effect on the accompanying
consolidated financial statements.
ITEM
7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not
applicable.
ITEM
8. FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA
See Index
to Financial Statements and Financial Statement Schedules appearing on page F-1
through F-23 of this Form 10-K.
DIAMOND
INFORMATION INSTITUTE, INC.
FINANCIAL
STATEMENTS
DECEMBER
31, 2009
17
DIAMOND
INFORMATION INSTITUTE, INC.
TABLE
OF CONTENTS
DECEMBER
31, 2009
Report
of Independent Registered Public Accounting Firm F-1
Balance
Sheet as of December 31,
2009 F-2
Statements
of Operations for the Years Ended
December
31, 2009 and 2008 F-3
Statement of Stockholder’s Equity (Deficit) as of December 31, 2009 F-4
Statements
of Cash Flows for the Years Ended December
31, 2009 and 2008 F-5
Notes
to the Financial Statements F-6 - F-9
18
Silberstein Ungar, PLLC CPAs and Business
Advisors
Fax (248)
281-0940
30600
Telegraph Road, Suite 2175
Bingham
Farms, MI 48025-4586
www.sucpas.com
Report of Independent
Registered Public Accounting Firm
To the
Board of Directors of
Diamond
Information Institute, Inc.
Las
Vegas, Nevada
We have
audited the accompanying balance sheet of Diamond Information Institute, Inc.
(the “Company”) as of December 31, 2009, and the related statements of
operations, stockholder’s equity, and cash flows for the year then ended. 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 audit. The financial statements of Diamond Information Institute, Inc. as of
and for the year ended December 31, 2008 were audited by other auditors whose
report dated March 23, 2009 expressed an unqualified opinion on those financial
statements.
We
conducted our audit 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 audit 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 also includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides 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 Diamond Information Institute, Inc.
as of December 31, 2009 and the results of its operations and its cash flows for
the year then ended, 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 1 to the
financial statements, the Company has no working capital, and has discontinued
its operations. These factors raise substantial doubt about the
Company’s ability to continue as a going concern. Management’s plans
with regard to these matters are described in Note 1. The accompanying financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
/s/ Silberstein Ungar,
PLLC
Silberstein
Ungar, PLLC
Bingham
Farms, Michigan
April 11,
2010
F-1
DIAMOND
INFORMATION INSTITUTE, INC.
BALANCE
SHEETS
AS
OF DECEMBER 31, 2009 and 2008
ASSETS
|
December
31, 2009
|
December
31, 2008
|
||||||
Net
assets in excess of liabilities of discontinued operations
|
$ | -0- | $ | 111,954 | ||||
Total
Assets
|
$ | -0- | $ | 111,954 | ||||
LIABILITIES
AND STOCKHOLDER'S EQUITY
|
||||||||
Liabilities
|
||||||||
Net
liabilities in excess of assets of discontinued operations
|
$ | -0- | $ | -0- | ||||
Stockholder's
Equity
|
||||||||
Common
stock, par value $0.001, 25,000,000 shares authorized, 11,813,100 and
11,643,100 shares issued and outstanding
|
11,814 | 11,643 | ||||||
Additional
paid in capital
|
1,660,535 | 1,599,707 | ||||||
Accumulated
deficit
|
(1,672,349 | ) | (1,499,396 | ) | ||||
Total
Stockholder's Equity
|
-0- | 111,954 | ||||||
Total
Liabilities and Stockholder's Equity
|
$ | -0- | $ | 111,954 |
See
accompanying notes to financial statements.
F-2
DIAMOND
INFORMATION INSTITUTE, INC.
STATEMENTS
OF OPERATIONS
FOR
THE YEARS ENDED DECEMBER 31, 2009 AND 2008
Year
Ended December 31, 2009
|
Year
Ended December 31, 2008
|
|||||||
Net
Loss from Discontinued Operations, net of income tax
|
$ | (172,953 | ) | $ | (1,106,856 | ) | ||
NET
LOSS PER SHARE: BASIC AND DILUTED (DISCONTINUED
OPERATIONS)
|
$ | (0.01 | ) | $ | (0.09 | ) | ||
WEIGHTED
AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED
|
11,796,470 | 12,405,723 |
See
accompanying notes to financial statements.
F-3
DIAMOND
INFORMATION INSTITUTE, INC.
STATEMENT
OF STOCKHOLDER’S EQUITY
AS
OF DECEMBER 31, 2009
Common
stock
|
Additional
paid-in
|
Accumulated
|
Deferred
|
|||||||||||||||||||||
Shares
|
Amount
|
Capital
|
Deficit
|
Compensation
|
Total
|
|||||||||||||||||||
Balance,
January 1, 2008
|
18,075,000 | $ | 18,075 | $ | 825,175 | $ | (392,540 | $ | (14,307 | ) | $ | 436,403 | ||||||||||||
Cancellation
of common stock outstanding
|
(7,200,000 | ) | (7,200 | ) | 7,200 | - | - | - | ||||||||||||||||
Share-based
compensation
|
317,500 | 317 | 317,183 | - | - | 317,500 | ||||||||||||||||||
Amortization
of deferred compensation in connection with services
rendered
|
- | - | - | - | 14,307 | 14,307 | ||||||||||||||||||
Issuance
of common stock for professional services rendered
|
450,000 | 450 | 449,550 | - | - | 450,000 | ||||||||||||||||||
Private
placement offering of common stock
|
600 | 1 | 599 | - | - | 600 | ||||||||||||||||||
Net
loss for the year ended December 31, 2008
|
- | - | - | (1,106,856 | ) | - | (1,106,856 | ) | ||||||||||||||||
Balance,
December 31, 2008
|
11,643,100 | 11,643 | 1,599,707 | (1,499,396 | ) | - | (111,954 | ) | ||||||||||||||||
Issuance
of common stock for professional services rendered
|
170,000 | 171 | 60,828 | - | - | 60,999 | ||||||||||||||||||
Net
loss for the year ended December 31, 2009
|
- | - | - | (172,953 | ) | - | (172,953 | ) | ||||||||||||||||
Balance,
December 31, 2009
|
11,813,100 | $ | 11,814 | $ | 1,660,535 | $ | (1,672,349 | ) | $ | - | $ | -0- |
See
accompanying notes to financial statements.
F-4
DIAMOND
INFORMATION INSTITUTE, INC.
STATEMENTS
OF CASH FLOWS
FOR
THE YEARS ENDED DECEMBER 31, 2009 AND 2008
Yrear
Ended December 31, 2009
|
Year
Ended December 31, 2008
|
|||||||
CASH
FLOWS FROM DISCONTINUED OPERATIONS
|
||||||||
Net
cash flows from discontinued operations
|
$ | 0 | $ | 0 | ||||
Cash,
beginning of period
|
0 | 0 | ||||||
Cash,
end of period
|
$ | 0 | 0 | |||||
See
accompanying notes to financial statements.
F-5
DIAMOND
INFORMATION INSTITUTE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2009
NOTE
1 – NATURE OF OPERATIONS AND BUSINESS CONTINUITY
Diamond
Information Institute Inc., formerly doing business as Designs by Bergio [the
"Company"] was engaged in the product design, manufacturing, distribution of
fine jewelry throughout the United States and is headquartered from its
corporate office in Fairfield, New Jersey. Based on the nature of
operations, the Company's sales cycle experienced significant seasonal
volatility with the first two quarters of the year representing 15% - 25% of
annual sales and the remaining two quarters representing the remaining portion
of annual sales.
Effective
October 19, 2009, as approved at our shareholder meeting on October 8, 2009, we
entered into a Share Exchange Agreement with Alba Mineral Exploration, Inc.
(“Alba”), a Delaware Corporation (the “Agreement”). Pursuant to the
Agreement, Alba agreed to issue our shareholders a total of 2,585,175 shares of
common stock in Alba in proportion to their holdings in our
company. Following the transaction described in the Agreement and
other accompanying transactions, our shareholders own 60% of the common stock
issued and outstanding in Alba. Also pursuant to the Agreement, Alba
acquired all of the assets and liabilities related to our business. As a result
of the transaction the company became a wholly-owned subsidiary of Alba, and all
of our operations related to the jewelry business we were in were discontinued.
See Note 8.
The
financial statements have been prepared on a going concern basis which assumes
the Company will be able to realize its assets and discharge its liabilities in
the normal course of business for the foreseeable future. The Company
has incurred losses since inception resulting in an accumulated deficit of
$18,299 as of December 31, 2009 and has no operating assets orliabilities and no
operations, which raises substantial doubt about the Company’s ability to
continue as a going concern. The ability to continue as a going
concern is dependent upon the Company finding new management to develop a new
business that generates profitable operations in the future and/or to obtain the
necessary capital to fund a new business plan.
NOTE
2 – SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES
Basis of
Presentation
The
Company uses the accrual basis of accounting and accounting principles generally
accepted in the United States of America (“GAAP” accounting) are the financial
statements are presented in US dollars. The Company has adopted a
December 31 fiscal year end.
Use of Estimates and
Assumptions
The preparation of financial statements in
conformity with accounting principles
generally accepted in the United
States
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.
Actual results could differ from those estimates.
Financial
Instruments
The
carrying value of the Company's financial instruments approximates their fair
value because of the short maturity of these instruments.
F-6
DIAMOND
INFORMATION INSTITUTE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2009
NOTE
3 – SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES (CONTINUED)
Income
Taxes
Income
taxes are accounted for under the assets and liability
method. Deferred tax assets and liabilities
are recognized for the estimated 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 and tax
credit carry forwards. Deferred tax assets and liabilities
are measured using enacted tax rates in effect for the year in which those
temporary differences are expected to be recovered or settled. Use of
net operating loss carryforwards for income tax purposes may be limited by
Intertnal Revenue Code section 382 if a change of ownership occurs.
Basic Income (Loss) Per
Share
Basic
income (loss) per share is calculated by dividing the Company’s net loss
applicable to common shareholders by the weighted average number of common
shares during the period. Diluted earnings per share is calculated by dividing
the Company’s net income available to common shareholders by the diluted
weighted average number of shares outstanding during the year. The diluted
weighted average number of shares outstanding is the basic weighted number of
shares adjusted for any potentially dilutive debt or equity. There are no such
common stock equivalents outstanding as of December 31, 2009.
Dividends
The
Company has not adopted any policy regarding payment of dividends. No dividends
have been paid during any of the periods shown.
Impairment of Long-Lived
Assets
The
Company continually monitors events and changes in circumstances that could
indicate carrying amounts of long-lived assets may not be recoverable. When such
events or changes in circumstances are present, the Company assesses the
recoverability of long-lived assets by determining whether the carrying value of
such assets will be recovered through undiscounted expected future cash flows.
If the total of the future cash flows is less than the carrying amount of those
assets, the Company recognizes an impairment loss based on the excess of the
carrying amount over the fair value of the assets. Assets to be disposed of are
reported at the lower of the carrying amount or the fair value less costs to
sell.
Advertising
Costs
The
Company’s policy regarding advertising is to expense advertising when
incurred.
Revenue
Recognition
The
Company recognizes revenue when products are fully delivered or services have
been provided and collection is reasonably assured.
Stock-Based
Compensation
Stock-based
compensation is accounted for at fair value in accordance with SFAS No. 123 and
123 (R) (ASC
718). To date, the Company has not adopted a stock option plan
and has not granted any stock options.
F-7
DIAMOND
INFORMATION INSTITUTE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2009
NOTE
3 – SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES (CONTINUED)
New Authoritative Accounting
Guidance
On
July 1, 2009, the Accounting Standards Codification (“ASC”) became the
Financial Accounting Standards Board (“FASB”) officially recognized source of
authoritative U.S. generally accepted accounting principles applicable to all
public and non-public non-governmental entities, superseding existing FASB,
AICPA, EITF and related literature. Rules and interpretive releases of the SEC
under the authority of federal securities laws are also sources of authoritative
GAAP for SEC registrants. All other accounting literature is considered
non-authoritative. The switch to the ASC affects the away companies refer to
U.S. GAAP in financial statements and accounting policies. Citing particular
content in the ASC involves specifying the unique numeric path to the content
through the Topic, Subtopic, Section and Paragraph structure.
FASB ASC Topic 260, “Earnings Per
Share.” On January 1, 2009, the Company adopted new authoritative
accounting guidance under FASB ASC Topic 260, “Earnings Per Share,” which
provides that unvested share-based payment awards that contain nonforfeitable
rights to dividends or dividend equivalents (whether paid or unpaid) are
participating securities and shall be included in the computation of earnings
per share pursuant to the two-class method.
FASB ASC Topic 820, “Fair Value
Measurements and Disclosures.” New authoritative accounting guidance
under ASC Topic 820,”Fair Value Measurements and Disclosures,” affirms that the
objective of fair value when the market for an asset is not active is the price
that would be received to sell the asset in an orderly transaction, and
clarifies and includes additional factors for determining whether there has been
a significant decrease in market activity for an asset when the market for that
asset is not active. ASC Topic 820 requires an entity to base its conclusion
about whether a transaction was not orderly on the weight of the evidence. The
new accounting guidance amended prior guidance to expand certain disclosure
requirements. The Company adopted the new authoritative accounting guidance
under ASC Topic 820 during the first quarter of 2009. Adoption of the new
guidance did not significantly impact the Company’s consolidated financial
statements.
Further
new authoritative accounting guidance (Accounting Standards Update
No. 2009-5) under ASC Topic 820 provides guidance for measuring the fair
value of a liability in circumstances in which a quoted price in an active
market for the identical liability is not available. In such instances, a
reporting entity is required to measure fair value utilizing a valuation
technique that uses (i) the quoted price of the identical liability when
traded as an asset, (ii) quoted prices for similar liabilities or similar
liabilities when traded as assets, or (iii) another valuation technique
that is consistent with the existing principles of ASC Topic 820, such as an
income approach or market approach. The new authoritative accounting guidance
also clarifies that when estimating the fair value of a liability, a reporting
entity is not required to include a separate input or adjustment to other inputs
relating to the existence of a restriction that prevents the transfer of the
liability. The forgoing new authoritative accounting guidance under ASC Topic
820 will be effective for the Company’s consolidated financial statements
beginning October 1, 2009 and is not expected to have a significant impact
on the Company’s consolidated financial statements.
FASB ASC Topic 825 “Financial
Instruments.” New authoritative accounting guidance under ASC Topic
825,”Financial Instruments,” requires an entity to provide disclosures about the
fair value of financial instruments in interim financial information and amends
prior guidance to require those disclosures in summarized financial information
at interim reporting periods.
F-8
DIAMOND
INFORMATION INSTITUTE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2009
NOTE
3 – SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES (CONTINUED)
New Authoritative Accounting
Guidance (continued)
FASB ASC
Topic 855, “Subsequent
Events.” New authoritative accounting guidance under ASC Topic 855,
“Subsequent Events,” establishes general standards of accounting for and
disclosure of events that occur after the balance sheet date but before
financial statements are issued or available to be issued. ASC Topic 855 defines
(i) the period after the balance sheet date during which a reporting
entity’s management should evaluate events or transactions that may occur for
potential recognition or disclosure in the financial statements, (ii) the
circumstances under which an entity should recognize events or transactions
occurring after the balance sheet date in its financial statements, and
(iii) the disclosures an entity should make about events or transactions
that occurred after the balance sheet date. The new authoritative accounting
guidance under ASC Topic 855 became effective for the Company’s financial
statements for periods ending after June 15, 2009. Effective February 24,
2010, the FASB issued Accounting Standards Update (“ASU”) No. 2010-09,
“Subsequent Events (Topic 855): Amendments to Certain Recognition and Disclosure
Requirements” which revised certain disclosure requirements. ASU No. 2010-09 did
not have a significant impact on the Company’s consolidated financial
statements. The company
evaluated subsequent events, which are events or transactions that occurred
after December 31, 2009 through the issuance of the accompanying consolidated
financial statements.
Management
does not believe that any other recently issued but not yet effective accounting
pronouncements, if adopted, would have an effect on the accompanying
consolidated financial statements.
NOTE
4 – RELATED PARTY TRANSACTIONS
The
Company received periodic advances from its principal stockholder based upon the
Company's cash flow needs. At December 31, 2008, $394,532 was due to the
shareholder. Interest expense was accrued at an average annual market
rate of interest which was 4.99% at December 31, 2008. No terms for repayment
were established.
During
2009, the Company obtained a $100,000 note payable for settlement of IT
implementation services to an Advisory Panel member.
NOTE
5 – COMMON STOCK
Articles of
Incorporation Amendment and Stock Split - The Company's Certificate
of Incorporation, as amended, authorizes the issuance of up to 25,000,000 shares
of common stock at a par value of $.001 per share. Over the course of
2007, the Company's Board of Directors ratified two forward stock splits. The
first stock split, for 1.725 to 1 and the second for 10,000 to 1.
This
resulted in common stock outstanding increasing from 1,000 to 17,250,000 which
were all owned by the Company's founder and CEO. The per share data for all
periods presented has been retroactively adjusted due to each of the stock
splits.
F-9
DIAMOND
INFORMATION INSTITUTE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2009
NOTE
5 – COMMON STOCK (CONTINUED)
Subsequent
to the forward stock splits, the Company's founder and CEO transferred a total
of 2,250,000 shares to the Company's President and an Advisory Panel
member. Upon resignation of the Company’s President and Advisory
Panel Member in late 2007, the Company cancelled 2,200,000 of the shares
previously issued to those individuals along with, 5,000,000 shares held by the
CEO and principal stockholder. These shares were cancelled in
February 2008.
The share
and per share data for all periods presented has been retroactively adjusted to
reflect the stock splits.
Debt
Conversions - In
April 2007, the Company entered into a Debt Conversion Agreement (the
"Agreement") and issued 100,000 shares of common stock at $1 per share to a
vendor as full satisfaction for accounts payable previously due and future
services to be rendered. Of the total $100,000 of common stock
issued, $55,000 was to satisfy previous account payable balances and $45,000 was
issued as consideration for future services to be rendered and was reflected in
the Deferred Compensation caption of the Stockholders' Equity section of the
Balance Sheet, of which approximately $14,000 was expensed in 2008. The shares
have a one year restriction from sale or offering.
Restricted Share
Issuances - In
January 2008, two Advisory Panel members and a Board of Director member received
restricted common stock for services to be rendered throughout
2008. The two Advisory Panel members received 50,000 and 100,000
shares, respectively, with a fair value of $1.00 per share or $150,000 while the
Board of Director member received 50,000 shares with a fair value of $1.00 per
share or $50,000. The share-based compensation expense for the three
and nine months ended September 30, 2008 amounted to $25,000 and $175,000,
respectively.
Also in
January 2008, the Company issued 117,500 shares of restricted common stock with
a fair value of $1.00 per share or $117,500 to employees. Shares
issued in connection with the Board of Director consent, were dispersed ratably
over the first two quarters of 2008 as authorized in the consent. The
Share-based Compensation expense for the three and nine months ended September
30, 2008 amounted to $0, and $117,500, respectively.
Additionally,
in January and February 2008, the Company sold 600 shares of common stock at
$1.00 per share to individual investees.
For the
year ended December 31, 2008, the Company issued to its SEC counsel, 450,000
shares of restricted common stock with a fair value of $1.00 per share or
$450,000 for services in connection with the effective filing of Form S-1 with
the SEC.
In
January 2009, the Company agreed to issue its SEC counsel, 100,000 shares of
restricted common stock with a fair value of $0.40 per share or $40,000 for
services in connection with the effective filing of Form 15c-211 and submittal
to FINRA through a market maker. The Share-Based Compensation expense for the
three and nine months ended September 30, 2009 amounted to $0 and $40,000,
respectively.
F-9
DIAMOND
INFORMATION INSTITUTE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2009
NOTE
5 – COMMON STOCK (CONTINUED)
In
February 2009, the Company issued to its CEO 50,000 shares of restricted common
stock with a fair value of $0.40 per share or $20,000 for services as a Board of
Directors member throughout 2009. The Share-based Compensation
expense for the three and nine months ended September 30, 2009 amounted to
$5,000 and $15,000, respectively.
In
February 2009, the Company issued its SEC counsel 20,000 shares of restricted
common stock with a fair value of $0.40 per share or $8,000 for legal services
to be provided for the Company’s SEC filings for the 2009 reporting
year.
NOTE
6 – COMMITMENTS AND CONTINGENCIES
At
December 31, 2009, the Company neither owned nor leased any real or personal
property.
NOTE
7 – INCOME TAXES
Deferred
income tax assets [liabilities] are as follows:
December
31,
|
December
31,
|
|||||||
2009
|
2008
|
|||||||
Deferred
Income Tax Assets:
|
||||||||
Net
Operating Loss Carryforwards
|
$ | 656,485 | $ | 590,514 | ||||
Allowance
for Doubtful Accounts
|
34,511 | 32,115 | ||||||
Allowance for Sales
Returns
|
13,903 | 52,862 | ||||||
Totals
|
704,899 | 675,491 | ||||||
Deferred
Income Tax Liabilities:
|
||||||||
Property
and Equipment
|
$ | (25,925 | ) | $ | (25,546 | ) | ||
Sec.
481 Adjustment - Accrual Basis
|
(249,919 | ) | (374,879 | ) | ||||
Totals
|
(275,844 | ) | (400,425 | ) | ||||
Gross
Deferred Tax Asset [Liability]
|
429,055 | 275,066 | ||||||
Valuation
Allowance for Deferred Taxes
|
(429,055 | ) | (275,066 | ) | ||||
Net
Deferred Tax Asset [Liability]
|
$ | -- | $ | -- |
Reconciliation
of the Federal statutory income tax rate to the effective income tax rate is as
follows:
2009
|
2008
|
|||||||
U.S.
statutory rate
|
(34 | %) | (34 | %) | ||||
State
income taxes – net of federal benefit
|
6 | % | 6 | % | ||||
Change
in valuation allowance and other
|
28 | % | 21 | % | ||||
Effective
rate
|
-- | (7 | %) |
F-10
DIAMOND
INFORMATION INSTITUTE, INC.
NOTES
TO THE FINANCIAL STATEMENTS
DECEMBER
31, 2009
NOTE
7 – INCOME TAXES (CONTINUED)
Effective
with the 2008 tax year, management voluntarily elected a change in its method of
tax accounting to the accrual basis as required by Section 481 of the Internal
Revenue Code (the "IRC"). In management's opinion, based on provisions of the
IRC, a voluntary election to the accrual basis of tax reporting should not
subject the Company to tax examinations for previous years that income tax
returns have been filed and prompt an uncertain tax position in accordance with
the ASC Topic No. 740. As a result, no contingent liability has been recorded
for the anticipated change in tax reporting. Further, the resulting tax
liability from the change in tax accounting method will be reduced by operating
losses previously incurred.
At
December 31, 2009, the Company had approximately $1,600,000 of federal net
operating tax loss carryforwards expiring at various dates through
2029. The Tax Reform Act of 1986 enacted a complex set of rules which
limits a company's ability to utilize net operating loss carryforwards and tax
credit carryforwards in periods following an ownership change. These rules
define an ownership change as a greater than 50 percent point change in stock
ownership within a defined testing period which is generally a three-year
period. As a result of stock which may be issued by us from time to time and the
conversion of warrants, options or the result of other changes in ownership of
our outstanding stock, the Company may experience an ownership change and
consequently our utilization of net operating loss carryforwards could be
significantly limited.
Based
upon the net losses historically incurred and, the prospective global economic
conditions, management believes that it is not more likely than not that the
deferred tax asset will be realized and has provided a valuation allowance of
100% of the deferred tax asset. The valuation allowance increased by
approximately $154,000 and $275,000 in the years ended December 31, 2009 and
2008, respectively.
NOTE
8 – DISCONTINUED OPERATIONS
The
Company’s former jewelry business, which was discontinued on October 19, 2009
when all assets and liabilities related to this business were acquired by Bergio
International, Inc. (formerly known as Alba Mineral Exploration, Inc.) has been
accounted for as discontinued operations. The results of operations
of this business have been removed from the results of continuing operations for
all periods presented. The assets and liabilities of discontinued
operations have been reclassified and are segregated in the balance
sheets.
NOTE
9 – SUBSEQUENT EVENTS
On
February 2, 2010 Bergio International, Inc. (the “Seller”), owner of 100% of the
outstanding common shares of the Company, entered into a share purchase
agreement (the “Agreement”) with Macau Consultants and Advisory Services Inc.
(the “Buyer”). In accordance with the terms and provisions of the
Agreement, the Seller sold an aggregate of 11,863,100 shares of common stock of
the Company to Buyer in exchange for $225,000. The closing and
consummation of the Agreement occurred March 18, 2010. New officers and
directors of the Company were apoointed and a change of control of the Company
occurred.
In
accordance with ASC 855-10, the Company has analyzed its operations subsequent
to December 31, 2009 and has determined that it does not have any other material
subsequent events to disclose in these financial statements.
F-11
ITEM
9.
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
|
We
have had no disagreements with our independent auditors on accounting or
financial disclosures.
|
ITEM
9A(T) CONTROLS
AND PROCEDURES
Our new
Chief Executive Officer, Paul Crawford, and Chief Financial Officer, Dennis
Atkins, evaluated the effectiveness of our disclosure controls and procedures
(as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as
amended) as of the end of the period covered by this Report. Based on
that evaluation, Messrs. Crawford and Atkins concluded that our disclosure
controls and procedures are effective in timely alerting them to material
information relating to us required to be included in our periodic SEC filings
and in ensuring that information required to be disclosed by us in the reports
that we file or submit under the Act is accumulated and communicated to our
management, including our principal executive and principal financial officer,
or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure.
There
were no changes in our internal control over financial reporting that occurred
during our most recent fiscal quarter that have materially affected, or
reasonably likely to materially affect, our internal control over financial
reporting.
Management’s
Report on Internal Control Over Financial Reporting
Our
management is responsible for establishing and maintaining adequate internal
control, as is defined in the Securities Exchange Act of 1934. These
internal controls are designed to provide reasonable assurance that the reported
financial information is presented fairly, that disclosures are adequate and
that the judgments inherent in the preparation of financial statements are
reasonable. There are inherent limitations in the effectiveness of
any system of internal controls, including the possibility of human error and
overriding of controls. Consequently, an effective internal control
system can only provide reasonable, not absolute, assurance with respect to
reporting financial information.
Our
internal control over financial reporting includes policies and procedures that:
(i) pertain to maintaining records that in reasonable detail accurately and
fairly reflect our transactions; (ii) provide reasonable assurance that
transactions are recorded as necessary for preparation of our financial
statements in accordance with generally accepted accounting principles and the
receipts and expenditures of company assets are made and in accordance with our
management and directors authorization; and (iii) provide reasonable assurance
regarding the prevention or timely detection of unauthorized acquisition, use or
disposition of assets that could have a material effect on our financial
statements.
Our
internal control over financial reporting includes policies and procedures that:
(i) pertain to maintaining records that in reasonable detail accurately and
fairly reflect our transactions; (ii) provide reasonable assurance that
transactions are recorded as necessary for preparation of our financial
statements in accordance with generally accepted accounting principles and the
receipts and expenditures of company assets are made and in accordance with our
management and directors authorization; and (iii) provide reasonable assurance
regarding the prevention or timely detection of unauthorized acquisition, use or
disposition of assets that could have a material effect on our financial
statements.
Management
has undertaken an assessment of the effectiveness of our internal control over
financial reporting based on the framework and criteria established in the
Internal Control – Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (“COSO”). Based upon this
evaluation, management concluded that our internal control over financial
reporting was effective as of December 31, 2009.
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 our
registered public accounting firm pursuant to the temporary rules of the
Securities and Exchange Commission that permit the company to provide only
management’s report in this annual report.
AUDIT
COMMITTEE
Our Board
of Directors has not established an audit committee. The respective role of an
audit committee has been conducted by our Board of Directors. In the event the
Merger Agreement is not consummated, we intend to establish an audit committee
during fiscal year 2010. When established, the audit committee's primary
function will be to provide advice with respect to our financial matters and to
assist our Board of Directors in fulfilling its oversight
19
responsibilities
regarding finance, accounting, and legal compliance. The audit committee's
primary duties and responsibilities will be to: (i) serve as an independent and
objective party to monitor our financial reporting process and internal control
system; (ii) review and appraise the audit efforts of our independent
accountants; (iii) evaluate our quarterly financial performance as well as its
compliance with laws and regulations; (iv) oversee management's establishment
and enforcement of financial policies and business practices; and (v) provide an
open avenue of communication among the independent accountants, management and
our Board of Directors.
ITEM
9B OTHER
INFORMATION
Not
applicable.
PART
III
ITEM
10
|
DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE
|
Following
the Share Purchase Agreement: (i) Berge Abajian resigned as the President/Chief
Executive Officer/Chief Financial Officer/Treasurer and the sole director of the
Company effective as of March 17, 2010; (ii) Arpi Abajian resigned as the
Secretary of the Company effective as of March 17, 2010; (iii) Paul Crawford
consented to act as the President /Chief Executive Officer and a director of the
Company effective as of March 18, 2010; (iv) Dennis Atkins consented to act as
the Chief Financial Officer and a director of the Company effective as of March
18, 2010; and (v) Merlin Larson consented to act as the Secretary and Treasurer
and a director of the Company effective as of March 18, 2010.
The
biographies of each of the new directors and officers are set forth below as
follows:
NAME
AGE POSITION
WITH THE COMPANY
___________ ___ _________________________________
Paul
Crawford 74 President/Chief
Executive Officer and a Director
Dennis
Atkins 49 Chief
Financial Officer and a Director
Merlin
Larson
35 Secretary
and Treasurer and a Director
Paul
Crawford. Since 1990, Mr. Crawford has been assisting early
stage companies in raising capital. He is both a venture capitalist and an
entrepreneur and has been working with developing businesses since the late
1970s. In addition to raising capital, Mr. Crawford has started several
successful businesses including Celcom. Cellcom was incorporated in Minnesota in
1981 specifically to acquire the first non-wire line cellular license in the
first phase of the first U.S. cellular phone systems. The initial cellular
licenses in the top 75 U.S. cities were opened to all filers who were then
submitted to a series of Federal Communications Commission (FCC) comparative
hearings, which is similar to how the F.C.C awards radio and television
licenses. The remaining U.S. cellular markets were subsequently
placed via a lottery. The deadline for the initial filings in the top markets
was closed in early 1982. This resulted in Celcom participating in a joint
venture with MCI. The Twin Cities cellular system operated as MCI/Celcom and
subsequently was renamed Cellular One of the Twin Cities. In 1986
MCI/Celcom sold the Twin Cities non-wireline cellular system
20
to McCaw
Communications for approximately $43 million. In July 1998, Mr. Crawford
co-founded Commission Junction (CJ). CJ became very profitable in
early 2002 and was acquired in December 2003 by ValueClick (VCLK) in a $58
million cash and stock transaction. CJ is a leader in the affiliate
marketing/pay-per-sale advertising on the Internet. Starting in late 2007, Mr.
Crawford focused on the next generation of the Internet which is a “sea change
event” underway today. The porfolio is dominated by Software as a Service (SaaS)
services and 4G, Mobile WiMAX and includes five SaaS businesses (Empathic
Clinical Suites, MSAFastDraftPRO, CompleteLAW-WEB, Sports Director Online,
Bankruptcy Compiler, LocaLoop, Inc.
Mr.
Crawford is the owner of Crawford Capital Corporation. Crawford Capital
Corporation is ranked as the 8th
largest Twin Cities based venture capital firm in the most recent 2010 Edition
of The Minneapolis-St. Paul
Business Journal. These rankings are based on total capital
raised by all reporting firms from their inception through December 31,
2008. Crawford Capital Corporation’s total at that time was
$200,000,000+. Paul Crawford and his wife reside in Minneapolis,
MN.
Dennis Atkins. Mr.
Atkins is a Certified Public Accountant with over twenty-five years experience
in public accounting. Mr. Atkins has extensive experience in business and
personal tax planning and preparation including the use of offshore domiciles
for income tax benefit and asset protection, public and private company auditing
and business consulting. He has been a member SEC Practice Section and the
Public Company Oversight Board. Mr. Atkins has served on the board of
directors and as chief financial officer for various private and publicly traded
companies. He is a member of the American Institute of Certified
Public Accountants and holds licenses in Oklahoma and California. Mr.
Atkins holds a Bachelors Degree in Accounting from Oklahoma State University and
a Masters Degree in Accountancy from the University of Oklahoma.
Merlin Larson. During the past
five years, Mr. Larson has been involved in the contruction housing industry in
Canada. Mr. Larson currently has a building contracting business in Victoria,
British Columbia.Mr. Larson gained a wealth of practical business experience and
knowledge growing up and working on a grain farm and in his father’s business
prior to graduating from high school in Vancouver, British Columbia. Mr. Larson
studied art at the Art College in Nelson, British Columbia, and earned a nursing
degree.
Directors
are elected to serve until the next annual meeting of stockholders and until
their successors have been elected and qualified. Officers are appointed to
serve until the meeting of the Board of Directors following the next annual
meeting of stockholders and until their successors have been elected and
qualified.
Involvement
in Certain Legal Proceedings
No
executive officer or director of the Corporation has been the subject of any
Order, Judgment, or Decree of any Court of competent jurisdiction, or any
regulatory agency permanently or temporarily enjoining, barring suspending or
otherwise limiting him from acting as an investment advisor, underwriter, broker
or dealer in the securities industry, or as an affiliated person, director or
employee of an investment company, bank, savings and loan association, or
insurance company or from engaging in or continuing any conduct or practice in
connection with any such activity or in connection with the purchase or sale of
any securities.
21
No
Executive Officer or Director of the Corporation has been convicted in any
criminal proceeding (excluding traffic violations) or is the subject of a
criminal proceeding which is currently pending.
No
Executive Officer or Director of the Corporation is the subject of any pending
legal proceedings.
Section
16(a) Beneficial Ownership Reporting Compliance
Section
16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
requires executive officers and directors, and persons who beneficially own more
than ten percent of an issuer's common stock, which has been registered under
Section 12 of the Exchange Act, to file initial reports of ownership and reports
of changes in ownership with the SEC.
As a
company with securities registered under Section 15(d) of the Exchange Act, our
executive officers and directors, and persons who beneficially own more than ten
percent of our common stock are not required to file Section 16(a)
reports.
ITEM
11. EXECUTIVE
COMPENSATION
The
following table sets forth the compensation of our executive officers for the
years ended December 31, 2009 and 2008, respectively.
Summary
Compensation Table
Name
and Principal Position
|
Year
Ended
December 31,
|
Salary
|
Stock
Awards (1)
|
All
Other Compensation
|
Total
|
Berge
Abajian Chief Executive Officer, President, Principal
Accounting Officer |
2008
2009
|
$6,242
$13,413
|
$50,000
$20,000
|
$25,496
(2)
$17,856
(2)
|
$81,738
$51,269
|
Alfred
Sirica (3) Former
Chief Financial Officer |
2008
2009
|
$-0-
$-0-
|
$-0-
$-0-
|
$-0-
$-0-
|
$-0-
$-0-
|
Arpi
Abajian (4) Secretary |
2008
2009
|
$-0-
$-0-
|
$25,000
$-0-
|
$-0- (2)
$-0-
(2)
|
$25,000
$-0-
|
(1)
|
The
amounts shown in this column reflect the expense recognized for financial
statement reporting purposes for the fiscal year ended December 31, 2009
and 2008, in accordance with FAS
123(R).
|
(2)
|
Other
compensation was made up of Mr. Abajian’s car expense and health insurance
expenses. Included in this amount was approximately $8,670 for
Ms. Abajian’s health insurance
expenses.
|
(3)
|
Mr.
Sirica agreed to serve as Chief Financial Officer during the time in which
the Company was going through the review process of its registration
statement. Subsequent to the registration statement becoming
effective, Mr. Sirica resigned and Mr. Abajian agreed to serve as the
Principal Accounting Officer.
|
(4)
|
On
January 8, 2009, the board of directors appointed Ms. Arpi Abajian as the
Secretary of the Company. On January 20, 2008, the Company
authorized shares to be issued to its employees as bonus compensation of
which Ms. Abajian received 25,000 shares. The shares were
issued during the first two quarters of
2008.
|
22
Employment
Agreement
The
Company currently does not have any employment agreements in place.
Termination
of Employment
There are
no compensatory plans or arrangements, including payments to be received from
the Company, with respect to any person associated with the Company which would
in any way result in payments to any such person because of his resignation,
retirement, or other termination of such person’s employment with the Company or
its subsidiaries, or any change in control of the Company, or a change in the
person’s responsibilities following a change in control of the
Company.
Compensation
Committee
We
currently do not have a compensation committee on the board of
directors. Until a formal committee is established our entire board
of directors will review all forms of compensation provided to our executive
officers, directors, consultants, and employees, including stock
compensation.
DIRECTOR
COMPENSATION TABLE
Name
|
Fees
Earned
or
Paid
in
Cash
($)
|
Stock
Awards
($)
|
Option
Awards
($)
|
Non-Equity
Incentive
Plan
Compensation
($)
|
Change
in
Pension
Value
and
Nonqualified
Deferred
Compensation
Earnings
($)
|
All
Other
Compensation
($)
|
Total
($)
|
Berge
Abajian
2008
2009
|
-0-
-0-
|
-0-
50,000
|
(1)
-0-
-0-
|
-0-
-0-
|
-0-
-0-
|
-0-
-0-
|
-0-
50,000
|
ITEM
12.
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTER
|
The
following table presents information, to the best of our knowledge, about
the beneficial ownership of our common stock as of the date of this Annual
Report, held by those persons known to beneficially own more than 5% of
our capital stock and by our directors and executive
officers. The percentage of beneficial ownership for the
following table is based on 11,863,100 shares of common stock outstanding
as of the date of this Annual
Report.
|
23
Beneficial
ownership is determined in accordance with the rules of the Securities and
Exchange Commission and does not necessarily indicate beneficial ownership
for any other purpose. Under these rules, beneficial ownership includes
those shares of common stock over which the stockholder has sole or shared
voting or investment power. It also includes (unless footnoted) shares of
common stock that the stockholder has a right to acquire within 60 days
after April 12, 2010 through the exercise of any option, warrant or other
right. The percentage ownership of the outstanding common stock, however,
is based on the assumption, expressly required by the rules of the
Securities and Exchange Commission, that only the person or entity whose
ownership is being reported has converted options or warrants into shares
of our common stock.
|
Name
and Address of Beneficial Owner(1)
|
Amount
and Nature of Beneficial Ownership(1)
|
Percentage
of Beneficial Ownership
|
Directors
and Officers:
|
||
Merlin
Larson
2300
W. Sahara Avenue, Suite 800
Las
Vegas, Nevada 89102
|
6,852,700
|
57.76%
|
Dennis
Atkins
2300
W. Sahara Avenue, Suite 800
Las
Vegas, Nevada 89102
|
2,000,000
|
16.86%
|
Paul
Crawford
2300
W. Sahara Avenue, Suite 800
Las
Vegas, Nevada 89102
|
2,000,000
|
16.86%
|
All
executive officers and directors as a group (3 persons)
|
10,852,700
|
99.48%
|
Beneficial
Shareholders Greater than 10%
|
||
None
|
*
|
Less
than one percent.
|
(1)
|
Under
Rule 13d-3, a beneficial owner of a security includes any person who,
directly or indirectly, through any contract, arrangement, understanding,
relationship, or otherwise has or shares: (i) voting power, which includes
the power to vote, or to direct the voting of shares; and (ii) investment
power, which includes the power to dispose or direct the disposition of
shares. Certain shares may be deemed to be beneficially owned by more than
one person (if, for example, persons share the power to vote or the power
to dispose of the shares). In addition, shares are deemed to be
beneficially owned by a person if the person has the right to acquire the
shares (for example, upon exercise of an option) within 60 days of the
date as of which the information is provided. In computing the percentage
ownership of any person, the amount of shares outstanding is deemed to
include the amount of shares beneficially owned by such person (and only
such person) by reason of these acquisition rights. As a result, the
percentage of outstanding shares of any person as shown in this table does
not necessarily reflect the person’s actual ownership or voting power with
respect to the number of shares of common stock actually outstanding as of
the date of this Annual Report. As of the date of this Annual Report,
there are 11,863,100 shares issued and
outstanding.
|
24
CHANGES
IN CONTROL
We are
unaware of any contract, or other arrangement or provision, the operation of
which may at a subsequent date result in a change of control of our
company.
ITEM
13. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
As of the
date of this Annual Report, none of our directors, officers or principal
stockholders, nor any associate or affiliate of the foregoing, have any
interest, direct or indirect, in any transaction or in any proposed
transactions, which has materially affected or will materially affect us during
fiscal year ended December 31, 2009.
ITEM
14. PRINCIPAL
ACCOUNTING FEES AND SERVICES
Audit
Fees
The
aggregate fees for professional services rendered by MSPC, Certified Public
Accountants and Advisors, A Professional Corporation for the audit of our annual
financial statements and review of the financial statements included in our Form
10-Q for the period ended December 31, 2009 or services that are normally
provided by the accountant in connection with statutory and regulatory filings
or engagements for fiscal year ended 2009 and 2008 were $7,500
and $57,500, respectively. The aggregate fees for
professional services rendered by Silberstein Ungar, PLLC for the annual audit
of our financial statements for the period ended December 31, 2009 were
$6,000.
Audit
Related Fees
The
aggregate fees by MSPC, Certified Public Accountants and Advisors, A
Professional Corporation for assurance and related services by the principal
accountant that are reasonably related to the performance of the audit or review
of the registrant’s financial statements for the fiscal years 2009 and 2008 were
$-0- and $-0-, respectively.
Tax
Fees
The
aggregate fees by MSPC, Certified Public Accountants and Advisors, A
Professional Corporation for professional services rendered by the principal
accountant for the fiscal years 2009 and 2008 were $-0- and $-0-,
respectively.
All
Other Fees
The
aggregate fees by MSPC, Certified Public Accountants and Advisors, A
Professional Corporation for products and services provided by the principal
accountant for the fiscal years 2009 and 2008 were $-0- and $-0-,
respectively.
25
PART
IV
ITEM
15. EXHIBITS,
FINANCIAL STATEMENT SCHEDULES
The
following exhibits are filed as part of this Annual Report.
Incorporated
by reference
|
||||||
Exhibit
|
Exhibit
Description
|
Filed
herewith
|
Form
|
Period
ending
|
Exhibit
|
Filing
date
|
3(i)
|
Certificate
of Incorporation, dated October 24, 1988
|
Form
S-1/A
|
3(i)
|
08/28/08
|
||
3(ii)
|
Amendment
to Certificate of Incorporation dated April 12, 2010.
|
X
|
||||
3(i)(b)
|
Certificate
of Trade Name, dated January 31, 1997
|
Form
S-1/A
|
3(i)(b)
|
08/28/08
|
||
3(i)(c)
|
Certificate
of Amendment to the Certificate of Incorporation, dated May 31,
2007
|
Form
S-1/A
|
3(i)(c)
|
08/28/08
|
||
3(ii)
|
Bylaws
of Diamond Information Institute, Inc.
|
Form
S-1/A
|
3(ii)
|
08/28/08
|
||
10.1
|
Sample
Subscription Agreement for the $25,000 unit offering
|
Form
S-1/A
|
10.1
|
08/28/08
|
||
23
|
Consent
of MSPC, dated March 23, 2009
|
X
|
||||
23.1 | Consent of Silberstein Ungar, PLLC | X | ||||
31
|
Certification
of Berge Abajian pursuant to Section 302 of the Sarbanes-Oxley
Act
|
X
|
||||
32
|
Certification
of Berge Abajian pursuant to Section 906 of the Sarbanes-Oxley
Act
|
X
|
26
DIAMOND
INFORMATION INSTITUTE, INC.
SIGNATURES
Pursuant to the requirements of the Exchange Act,
the registrant caused this report to be signed on its behalf by the undersigned,
therunto duly authorized.
DIAMOND
INFORMATION INSTITTUE INC.
|
||
Dated:
April 14, 2010
|
By:
|
/s/ PAUL
CRAWFORD
|
Paul
Crawford, President/Chief
|
||
Executive
Officer
|
||
Dated:
April 14, 2010
|
By:
|
/s/
DENNIS ATKINS
|
Dennis
Atkins, Chief Financial Officer
|
||
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.
Dated:
April 14, 2010
|
By:
|
/s/ PAUL
CRAWFORD
|
Director
|
Dated:
April 14, 2010
|
By:
|
/s/ DENNIS
ATKINS
|
Director
|
Dated:
April 14, 2010
|
By:
|
/s/ MERLIN
LARSON
|
Director
|
27