UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-K/A
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED
March 31, 2018
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from__________________ to _______________________.
Commission File Number 000-27019
INVESTVIEW, INC.
(Exact name of registrant as specified in its charter)
| Nevada | 87-0369205 | |
(State or other jurisdiction of incorporation) | (I.R.S. Employer Identification No.) |
12 South 400 West
Salt Lake City, Utah 84101
(Address of principal executive offices)
Issuer’s telephone number: 888-778-5372
Securities registered pursuant to Section 12(b) of the Act: None
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.001$0.001 Par Value Per Share
(Title of Class)
Indicate by check mark whether the registrant is a well-known seasoned issuer as defined in Rule 405 of the Securities Act. Yes ☐[ ] No ☒
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 ☐[ ] 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 ☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒[X] No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
| Large accelerated filer | Accelerated filer |
| Non-accelerated filer | Smaller Reporting Company |
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act) Yes ☐[ ] No ☒
State the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a)aggregate market value of the Exchange Act. ☐
Indicate the number of shares outstanding of each of the above statement only, all directors, executive officers and 10% shareholders are assumed to be affiliates. This determinationregistrant’s classes of affiliate status is not necessarily a conclusive determination for any other purpose.
Documents incorporated by reference.
Revised to reflect corrections to CEO's Biography under Item 10.
2019 FORM 10-K ANNUAL REPORT
Table of Contents
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
CERTAIN STATEMENTS CONTAINED IN THIS REPORT AND THE INFORMATION INCORPORATED BY REFERENCE HEREIN MAY CONTAIN "FORWARD-LOOKING STATEMENTS".“FORWARD-LOOKING STATEMENTS.” THESE STATEMENTS, WHICH INVOLVE RISKS AND UNCERTAINTIES, REFLECT OUR CURRENT EXPECTATIONS, INTENTIONS, OR STRATEGIES REGARDING OUR POSSIBLE FUTURE RESULTS OF OPERATIONS, PERFORMANCE, AND ACHIEVEMENTS. FORWARD-LOOKING STATEMENTS INCLUDE, WITHOUT LIMITATION: STATEMENTS REGARDING FUTURE PRODUCTS OR PRODUCT DEVELOPMENT; STATEMENTS REGARDING FUTURE SELLING, GENERAL AND ADMINISTRATIVE COSTS AND RESEARCH AND DEVELOPMENT SPENDING; STATEMENTS REGARDING THE FUTURE PERFORMANCE OF OUR NETWORK MARKETING EFFORTS; STATEMENTS REGARDING OUR EXPECTATIONS REGARDING ONGOING LITIGATION; STATEMENTS REGARDING INTERNATIONAL GROWTH; AND STATEMENTS REGARDING FUTURE FINANCIAL PERFORMANCE, RESULTS OF OPERATIONS, CAPITAL EXPENDITURES AND SUFFICIENCY OF CAPITAL RESOURCES TO FUND OUR OPERATING REQUIREMENTS.
THESE FORWARD-LOOKING STATEMENTS MAY BE IDENTIFIED IN THIS REPORT AND THE INFORMATION INCORPORATED BY REFERENCE BY WORDS SUCH AS "ANTICIPATE"“ANTICIPATE”, "BELIEVE"“BELIEVE”, "COULD"“COULD”, "ESTIMATE"“ESTIMATE”, "EXPECT"“EXPECT”, "INTEND"“INTEND”, "PLAN"“PLAN”, "PREDICT"“PREDICT”, "PROJECT"“PROJECT”, "SHOULD"“SHOULD” AND SIMILAR TERMS AND EXPRESSIONS, INCLUDING REFERENCES TO ASSUMPTIONS AND STRATEGIES. THESE STATEMENTS REFLECT OUR CURRENT BELIEFS AND ARE BASED ON INFORMATION CURRENTLY AVAILABLE TO US. ACCORDINGLY, THESE STATEMENTS ARE SUBJECT TO CERTAIN RISKS, UNCERTAINTIES, AND CONTINGENCIES, WHICH COULD CAUSE OUR ACTUAL RESULTS, PERFORMANCE, OR ACHIEVEMENTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED IN, OR IMPLIED BY, SUCH STATEMENTS.
The following factors are among those that may cause actual results to differ materially from our forward-looking statements:
| ● | noncompliance by our independent distributors with applicable legal requirements or our policies and procedures; | |
| ● | potential adverse effects on our business and stock price due to ineffective internal controls over financial reporting; | |
| ● | inability to manage financial reporting and internal control systems and processes; | |
| ● | inability to properly motivate and manage our independent distributors; | |
| ● | inability to manage existing markets, open new international markets, or expand our operations; | |
| ● | inability of new products to gain distributor or market acceptance; | |
| ● | inability to execute our product launch process due to increased pressure on our supply chain, information systems, and management; | |
| ● | disruptions in our information technology systems; | |
| ● | inability to protect against cybersecurity risks and to maintain the integrity of data; | |
| ● | international trade or foreign exchange restrictions, increased tariffs, and foreign currency exchange fluctuations; | |
| ● | deterioration of global economic conditions; | |
| ● | inability to raise additional capital if needed; | |
| ● | inability to retain independent distributors or to attract new independent distributors on an ongoing basis; | |
| ● | government regulations on direct selling activities in our various markets prohibiting or severely restricting our business; | |
| ● | unfavorable publicity on our business or products; | |
| ● | a finding that our direct selling program is not in compliance with current or newly adopted laws or regulations in various markets; | |
| ● | expensive and time-consuming legal proceedings; | |
| ● | potential for investigatory and enforcement action by the Federal Trade Commission; | |
| ● | failure to comply with anti-corruption laws; | |
| ● | inability to build and integrate our management team; | |
| ● | loss of, or inability to attract, key personnel; | |
| ● | unexpected tax or other assessments relating to the activity of our independent distributors; | |
| ● | economic, political, foreign exchange, and other risks associated with international operations; and | |
| ● | volatility of the market price of our common stock. |
When considering these forward-looking statements, youinvestors should keep in mind the cautionary statements in this report and the documents incorporated by reference. Except as required by law, we have no obligation and do not undertake to update or revise any such forward-looking statements to reflect events or circumstances after the date of this report.
Corporate History
Investview, Inc. was incorporated on January 30, 1946, under the laws of the state of Utah as the Uintah Mountain Copper Mining Company. In January 2005, the Companywe changed domicile to Nevada and changed itsour name to Voxpath Holding, Inc. In September of 2006, the Companywe merged The Retirement Solution Inc. through a Share Purchase Agreement into Voxpath Holdings,Holding, Inc. and then changed itsour name to TheRetirementSolution.Com, Inc. and in October 2008 changed itsour name to Global Investor Services, Inc., before changing itsour name to Investview, Inc., on March 27, 2012.
On March 31, 2017, the Companywe entered into a Contribution Agreement with the members of Wealth Generators, LCC,LLC, a limited liability company (“Wealth Generators”), pursuant to which the Wealth Generators Members agreed to contribute 100% of the outstanding securities of Wealth Generators in exchange for an aggregate of 1,358,670,942 shares of theour common stock of the Company. Thestock. This closing of the Wealth Generators Contribution occurred after close of business on March 31, 2017, therefore, effective April 1, 2017, Wealth Generators became aour wholly owned subsidiarysubsidiary.
On June 6, 2017, we entered into an Acquisition Agreement with Market Trend Strategies, LLC, a company whose members are also former members of our management. Under the Company (see Note 13). Acquisition Agreement, we spun-off our operations that existed prior to the merger with Wealth Generators and sold the intangible assets used in those pre-merger operations in exchange for Market Trend Strategies’ assumption of $419,139 in pre-merger liabilities.
On February 28, 2018, Investviewwe filed a name change for Wealth Generators LLC to Kuvera LLC (“Kuvera”), this did not affect the company’s tax and federal identification.
On May 7, 2018, we established WealthGen Global, LLC as a Utah limited liability company and our wholly owned subsidiary.
On July 20, 2018, we entered into a Purchase Agreement with United Games Marketing LLC, a Utah limited liability company, to purchase its wholly owned subsidiaries United Games, LLC and United League, LLC for 50,000,000 shares of our common stock.
On November 12, 2018, we established Kuvera providesFrance, S.A.S. to handle sales of our financial education and research in the European Union.
On December 30, 2018, our wholly owned subsidiary S.A.F.E. Management, LLC received its registration and disclosure approval from the National Futures Association. S.A.F.E. Management, LLC is now a New Jersey State Registered Investment Adviser, Commodities Trading Advisor, Commodity Pool Operator, and approved for over the counter FOREX advisory services.
On January 17, 2019, we renamed our nonoperating wholly owned subsidiary WealthGen Global, LLC to SAFETek, LLC, a Utah limited liability company.
Overview
We own a number of companies that each operate independently, but are accretive to one another. We are establishing a portfolio of wholly owned subsidiaries delivering leading-edge technologies, services, and research dedicated primarily to the individual consumer.
Through our wholly owned subsidiaries, we provide affordable access to financial education, current market research, and cutting-edge technology that enables individuals to increase and cultivate their own financial resources, enjoy life, and plan for the future. The services include basic financial educational, expense and debt reduction tools, research, newsletter alerts, and live education rooms that include instruction on the subjects of equities, options, FOREX,Forex, ETFs, binary options, crowdfunding, and the emerging crypto currencycryptocurrency market.
We seek to provide a completely transparent and unique experience specifically designed to enhance the financial knowledge and improve the overall well-being of individuals worldwide. Our goal is to invest in the education, research, and technology essential to helping the financially motivated secure lasting and balanced success for today and the future.
Each product subscription includes a core set of tools/research along with the personal finance management suite providing an individual complete access to the information necessary to cultivate and manage theirhis or her financial situation. The Company offersWe offer packages available through a monthly subscription that can be cancelled at any time at the discretion of the customer. A unique component of the product marketing plan is the distribution method whereby all subscriptions are sold via current participating customers who choose to distribute and sell the services. The bonus plan participation is purely optional but enables individuals the ability to create an additional income stream to further support their personal financial goals and objectives.
We recently entered the trade automation space with the launch of two new robo trading products offered to Kuvera subscribers through our wholly owned subsidiary, SAFE Management, which is a registered investment adviser. SAFE Management can make investments to the trading signals and research products of Kuvera; put and call options and alternative investments; and investments in privately held startups for the benefit of individuals who desire to participate in new venture startup opportunities.
Our Mission
Kuvera Entities
Our missionlargest subsidiary is Kuvera LLC, which delivers financial education, technology, and research to individuals through a subscription-based model. Kuvera provides research, education, and investment tools designed to assist the self-directed investor in successfully navigating the financial markets. These services include research, trade alerts, and live trading rooms that include instruction in equities, options, FOREX, ETFs, binary options, crowdfunding, and cryptocurrency sector education. In addition to trading tools and research, we also offer full education and software applications to assist the individual in debt reduction, increased savings, budgeting, and proper tax management. Each product subscription includes a core set of trading tools/research along with the personal finance management suite to provide an individual with complete access to the information necessary to cultivate and manage his or her financial situation. Kuvera operations are located at our Salt Lake City, Utah headquarters location and its website address is kuveraglobal.com.
Kuvera France S.A.S. is our entity in France that will distribute Kuvera products and services throughout the European Union.
Kuvera and Kuvera France provide affordable access to valuable financial education, current market research, and cutting-edge technology that enablesenable individuals to increase and cultivate their own financial resources, enjoy life, and plan for the future.
Each product subscription includes a core set of tools/research along with the personal finance management suite providing an individual with complete access to the way we do business.information necessary to cultivate and manage his or her financial situation. We don’t just say it; we show it. Our customers are often burdened by the weight of financial stress. They are looking foroffer packages available through a way out, a way to succeed, a way tomonthly subscription that can be free. We care because we’ve been there. We know it’s possible to improve our livescancelled at every level. We care because we are in the business of educating and training people to find, grow and keep a stable financial footing. We care because we are genuinely interested in offering customers a path to success.
By enabling the marriage of technology and knowledge, we are able to deliver innovative solutions directly to individuals around the world. Education and information for personal financePersonal and general financial education isinstruction and information are largely overlooked in all levels of education. An on-goingongoing cycle of debt accumulation, inability to save, lack of planning, and inadequate knowledge on how to cultivate our “capital” is passed from generation to generation.
By creating easy access, focused tutorials, and step by stepstep-by-step planning, our education and technology tools provide individuals with the necessary information to understand the power of proper utilization of money along with the ability to design their own path toward financial fitness.
Money and DEDUCTR Pro.
Deductr—Deductr is a personal money management tool that Wealth Generators provideswe provide to all members through a partnership with Deductr. The Deductr personal finance manager allows its users to manage all of their personal finances from a single view. With this tool, the user can create and monitor yourhis or her budget and financial goals in a matter of minutes.
FXOne – FXOne is one of our most interactive Forex products. —FXOne includes live Forex Binary Options Sessionsbinary options sessions with our market experts, as well as Forex newsletter alerts delivered right to youra mobile phone. FXOne also offers unique strategies and in-depth Forex training.
Binary options - Options—FXOne binary options session leverage very short-term strategies that give youindividuals immediate results in a relatively shortsmall amount of time. Live sessions are often as shortquick as 15 minutes. The live session provides the user real timereal-time strategies wherethat the user can follow along directly withas the experts as they identify setups and provide commentary to theirhis or her activity. The user can then determine whether to act on that information.
Newsletter alerts - Alerts—FXOne gives the user the opportunity to follow market experts while maintaining complete control of theirhis or her money. With FXOne Forex Alerts, our experts do the research and analysis and deliver that information to the user via email alerts. The alerts include entry criteria, exit parameters, and position adjustments. A lifetime of experience delivered right to your hands.
RYZE – RYZE is an algorithm based on supply side objectives. The algorithm identifies anomalies in currency pair transactions and enters positions that will ultimately be sold into large volume liquidations. These transactions can last intraday, multiple days, weeks or months. RYZE is made available to international clients.
CRYPTO Mining Packages
Equity Markets
Portfolio Builder: With Portfolio Builder, the user can decide which investment vehicles fit the user’s financials goals. Our Market Experts select, analyze, and review a wide field of commission free Exchange Traded Funds enabling self-directed individuals an alternative to mutual funds.
Kuvera University: Investview and the Kuvera brand isUniversity—We are committed to providing “best in class” education across a variety of topics. Kuvera University provides exclusive access to our market education library, live monthly webinars with our market expert's, in depthexperts, in-depth distributor training, personal development training, with ongoing additional content added on-going.content. After watching and studying the videos and materials in Kuvera University, the user will have a foundation in the global financial markets, a deeper understanding of how to manage your finances effectively,effective financial management, and additional skills that will help the user’s entrepreneurial and professional endeavors. Kuvera University is included with all customer subscriptions to ensure an ever-increasing value to our monthly access price.
Continual expansion and enhancement to these services and their delivery is the key to the longevity of the program. With a continual focus to increase convenience through the use of technology and by offering a wide variety of market approaches, our products are designed to meet the needs of the passive, moderately active, and highly motivated self-directed investors.
S.A.F.E. Management
S.A.F.E. Management, LLC is a Registered Investment Adviser and Commodity Trading Adviser that has been established to deliver automated trading strategies to individuals who find they lack the time to trade for themselves. S.A.F.E. is committed to bringing innovative trade methodologies, strategies, and algorithms for all worldwide financial markets. S.A.F.E. Management is a state registered investment adviser and operations are located at our Eatontown, New Jersey corporate finance location and its website address is safeadvglobal.com.
United Entities
United League, LLC owns a number of proprietary technologies including FIREFAN, a social app for sports enthusiasts. Technologies created to support any of our Keep philosophycompanies are held under the United League structure.
United Games, LLC is the Deductr Pro softwaredistribution network for United League technologies. Since the acquisition of United Games in July of 2018, we are working to combine the distributors of Kuvera and its ability to track and manage potential tax write-offs including automated mileage trackingUnited Games. This is an ongoing process that is not targeted for completion until the end of calendar year 2019.
SAFETek
SAFETek, LLC (formerly WealthGen Global, LLC) is a new addition that we are currently establishing for expansion plans in real-time. Fully deploying the capabilities of Deductr, an individual can see their up to the minute potential tax write offs throughout the year. Tax season becomeshigh-speed processing computing space. SAFETek will deploy a painless submission of Deductr reports versus the agonizing manual process of trying to calculate expenditures once per year. In addition, Deductr Prolarge-scale processing operation that is instrumental in budget creation and expense management in real-time.
Our Vision
We envision an ongoing integration of the type of financial researchlatest technologies with emerging needs to deliver leading edge products and education selected in the GROW portion. All subscriptions include the full breadth of Kuvera University education regardless of subscription selected. We view this as our value commitment, ensuring a full suite of education with each product subscription.
Distribution Method
We use an affiliate model to sell itsour product subscriptions. Anyone with an interest can participate in our bonus plan, thatwhich rewards them for selling product subscriptions. We believe this component of our offering is extremely powerful as it provides:
Competition
We face competition for each of itsour product categories, but doesdo not have a similar competitor with the full suite of services offered. Each of the financial education products, alerts, tools, and newsletters face competition from similar product companies such as TheStreet.com, The Motley Fool, Jim Cramer, anzzd similar subscription basedand like subscription-based financial research services. The personal money management education and tools face competition from free mobile apps designed for the same purpose although Investview’sour personal money management does not advertise or entice the user to refinance or secure new loans and is a pure management tool that serves the individual and not the advertiser. The company’sOur tax management tools and education have limited competition, and we have deployed Deductr Pro as our tool of choice. Unique to our company is not the individual product but the combined suite of products for one monthly subscription price, cancellable at any time by the user and distributed exclusively by the active members through the optional bonus plan for those who choose to sell the service to others.
We believe our competitive advantages include:
| ● | a generous bonus program for independent affiliates; | |
| ● | a management team with extensive experience in financial education and market strategy research/technology; | |
| ● | a young and motivated distributor base; | |
| ● | a large demographic that services all genders, races, religions, and nationalities; and | |
| ● | a delivery platform enabling us to launch new products quickly and efficiently worldwide. |
Our competitive weaknesses include:
Intellectual Property
Our success is predicated on the adoption of new and innovative technology, education, and research along with constantly improving convenience tools. The delivery of alerts and financial information through our platform provides various levels of automation that is programmed and designed by the companyus exclusively for our products and modified to enable the individual to initiate action on alerts they desire. We own the intellectual property for many of our products strategies and platform delivery mechanisms while we make other products available through licensed arrangements. In this way, we can continually offer a full suite of “best of breed” services to ensure our members are receiving the most value and leading-edge programs for their monthly subscription.
Expansion
We are in the process of expanding the business internationally. International planning and re-structuringrestructuring is taking place as a result of the recent name change to Kuvera and will be rolled out in the later part of 2018.Kuvera. Our affiliated entity, WG LATAM S.A.S., which has been re-establishedreestablished to Kuvera LATAM S.A.S,S.A.S., distributes the Company’stour products and services in Colombia and surrounding Latin American countries. International operations can be impacted by international regulations and economic conditions, although all are continuously monitored.
Government Regulation
We have historically positioned the Companycompany as a knowledge provider and educator whichthat seeks to augment a user’s informed decision-making process, rather than to act as a conductor of investment decisions or a representative of investment services. As such, most of our activities do not fall within the scope of securities industry regulation. We do not provide securities brokerage or investment advisory services. OurMost of our products and services also do not require that any representative distributing theour services of Investview conduct themselves as an investment advisor or broker. However, our subsidiary S.A.F.E. Management, LLC, recently received its registration and disclosure approval from the National Futures Association. S.A.F.E. Management, LLC is now a New Jersey State Registered Investment Adviser (“RIA”), Commodities Trading Advisor (“CTA”), and Commodity Pool Operator registered with the U.S. Commodity Futures Trading Commission (“CFTC”), and is approved by the CFTC for over the counter FOREX advisory services. As a New Jersey-registered RIA, we are required to comply with New Jersey’s laws and regulations governing the activities of investment advisers and the fees they can charge, as well as certain provisions of the Investment Adviser Act of 1940. As a CFTC registered CTA, Commodity Pool Operator, and FOREX adviser, we are required to comply with federal law and CFTC rules regulating those activities.
We have established these registrations and the advisory structure to offer automated trade execution, which is managed by S.A.F.E. Management, LLC, in fact encourage all representativesits capacity as an RIA, for equities and usersequity options and in its capacity as a CTA for commodities, futures, and OTC Forex. In addition, SAFE provides traditional advisory services for clients who do not wish to trade for themselves. Automation of trades is only available through S.A.F.E. Management. No additional approvals are required for any of our information servicescurrent business activities. The cost of maintaining this additional regulated entity could have a material adverse effect on our business and could subject us to seek unrelated investment professionals for securities related activities.
We are subject to government regulation in connection with securities laws and regulations applicable to all publicly-ownedpublicly owned companies as well as laws and regulations applicable to businesses generally. We are also increasingly subject to governmentgovernmental regulation and legislation specifically targeting Internet companies, such as privacy regulations adopted at the local, state, national and international levels and taxes levied at the state level. Due to the increasing popularity and use of the Internet,internet, enforcement of existing laws, such as consumer protection regulations, in connection with Web-basedweb-based activities has become more aggressive, and it is expected that new laws and regulations will continue to be enacted at the local, state, national, and international levels. Such new legislation, alone or combined with increasingly aggressive enforcement of existing laws, could inhibit the growth in use of the Internet and decrease the acceptance of the Internet as a communications and commercial medium, which could in turn decrease the demand for our services or otherwise have a material adverse effect on our future operating performance and business.
Employees
As of March 31, 2018, the Company has 24June 27, 2019, we had 32 employees.
Internet Address
Additional information concerning our business can be found on our Web sitewebsite atwww.investview.com for the most up-to-date corporate financial information, presentation announcements, transcripts, and archives. Information regarding our products and services offered by our wholly owned subsidiary:subsidiary, Kuvera LLC, may be found atwww.kuveraglobal.com. SAFE Management LLC services can be viewed atwww.safeadvglobal.com. Web site links provided in this report, although correct when published, may change in the future. We make available free of charge on our Web sitewebsite our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports, as soon as reasonably practicable after we electronically file such material with or furnish it to the SEC.Securities and Exchange Commission.
Investors should carefully consider the following material risk factors as well as all other information set forth or referred to in this report before purchasing shares of our common stock. Investing in our common stock involves a high degree of risk. The Company believesWe believe all material risk factors have been presented below. If any of the following events or outcomes actually occurs, our business operating results and financial condition would likely suffer. As a result, the trading price of our common stock could decline, and youinvestors may lose all or part of the money you paid to purchase our common stock.
Risks Related to our Business Operations
We have a limited operating history and, therefore, there is an elevated risk of potential business failure unless we can overcome the various obstacles inherent to an early stage business.
We have only limited prior business operations. Because of our limited operating history, youinvestors may not have adequate information on which youthey can base an evaluation of our business and prospects. Investors should be aware of the difficulties, delays, and expenses normally encountered by an enterprise in its early stage, many of which are beyond our control, including unanticipated research and development expenses, employment costs, and administrative expenses. We cannot assure our investors that our proposed business plans as described herein will materialize or prove successful, or that we will be able to finalize development of our products or operate profitably.
We have incurred substantial operating losses since inception (August 1, 2005), and we may never achieve profitability.
From our inception on August 1, 2005, through March 31, 2018,2019, we have incurred cumulative losses of $20,067,403,$25,096,983, recorded net losses from operations of $14,913,016$5,011,036 for the year ended March 31, 2018,2019, and our cash balance on March 31, 20182019, was $1,490,686. There can be no assurance$133,644. Accordingly, we cannot assure that we will achieve profitability in the immediate future or at all.
Our independent auditors have expressed substantial doubt about our ability to continue as a going concern.
In their audit opinion issued in connection with our consolidated balance sheet as of March 31, 20182019, and our related consolidated statements of operations, deficiency in stockholders’ equity,deficit, and cash flows for the year ended March 31, 2018,2019, our auditors have expressed substantial doubt about our ability to continue as a going concern given our recurring net losses, negative cash flows from operations, and the limited amount of funds on our balance sheet. We have prepared our consolidated financial statements on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The consolidated financial statements do not include any adjustments that might be necessary should we be unable to continue in existence. This could make it more difficult to raise capital in the future.
We may not be able to manage our growth effectively, which could slow or prevent our ability to achieve profitability.
The ability to manage and operate our business as we execute our development and growth strategy will require effective planning. Significant rapid growth could strain our internal resources and delay or prevent our efforts to achieve profitability. We expect that our efforts to grow will place a significant strain on our personnel, management systems, infrastructure, and other resources. Our ability to manage future growth effectively will also require us to successfully attract, train, motivate, retain and manage new employees and continue to update and improve our operational, financial and management controls and procedures. If we do not manage our growth effectively, slower growth is likely to occur and thereby slowing or negating our ability to achieve and sustain profitability.
We may not be able to fully protect our proprietary rights and we may infringe the proprietary rights of others, which could result in costly litigation.
Our future success depends on our ability to protect and preserve the proprietary rights related to our products. We cannot assure you that we will be able to prevent third parties from using our intellectual property rights and technology without our authorization. The CompanyWe also reliesrely on trade secrets, common law trademark rights, and trademark registrations, as well as confidentiality and work for hire, development, assignment, and license agreements with employees, consultants, third partythird-party developers, licensees, and customers. Our protective measures for these intangible assets afford only limited protection and may be flawed or inadequate.
Policing unauthorized use of our technology is difficult and some foreign laws do not provide the same level of protection as U.S. laws. Litigation may be necessary in the future to enforce our intellectual property rights, to protect our trade secrets or patents that we may obtain, or to determine the validity and scope of the proprietary rights of others. Such litigation could result in substantial costs and diversion of resources and have a material adverse effect on our future operating results.
In recent years, there has been significant litigation in the United States involving patents and other intellectual property rights. In particular, there has been an increase in the filing of suits alleging infringement of intellectual property rights, which pressure defendants into entering settlement arrangements quickly to dispose of such suits, regardless of their merits. Other companies or individuals may allege that we infringe on their intellectual property rights. Litigation, particularly in the area of intellectual property rights, is costly and the outcome is inherently uncertain. In the event of an adverse result, we could be liable for substantial damages and we may be forced to discontinue our use of the subject matter in question or obtain a license to use those rights or develop non-infringing alternatives.
Our business could be negatively affected by any adverse economic developments in the securities markets and/or the economy in general.
We depend on the interest of individuals in obtaining financial information and securities trading strategies to assist them in making their own investment decisions. Significant downturns in the securities markets or in general economic and political conditions may cause individuals to be reluctant to make their own investment decisions and thus decrease the demand for our products.
We may encounter risks relating to security or other system disruptions and failures that could reduce the attractiveness of itsour sites and that could harm itsour business.
Although the Company haswe have implemented various security mechanisms, itsour business is vulnerable to computer viruses, physical or electronic break-ins, and similar disruptions, which could lead to interruptions, delays, or loss of data. For instance, because a portion of our revenue is based on individuals using credit cards to purchase subscriptions over the Internet and a portion from advertisers that seek to encourage people to use the Internet to purchase goods or services, our business could be adversely affected by these break-ins or disruptions. Additionally, itsour operations depend on itsour ability to protect systems against damage from fire, earthquakes, power loss, telecommunications failure, and other events beyond the Company’sour control. Moreover, the Company’sour website may experience slower response times or other problems for a variety of reasons, including hardware and communication line capacity restraints, software failures, or during significant increases in traffic when there have been important business or financial news stories and during the seasonal periods of peak SEC filing activity.stories. These strains on itsour systems could cause customer dissatisfaction and could discourage visitors from becoming paying subscribers. The Company’sOur websites could experience disruptions or interruptions in service due to the failure or delay in the transmission or receipt of information from Investview.com.us. These types of occurrences could cause users to perceive itsour website and technology solutions as not functioning properly and cause them to use other methods or services of itsour competitors. Any disruption resulting from these actions may harm the Company’sour business and may be very expensive to remedy, may not be fully covered by our insurance, and could damage itsour reputation, and discourage new and existing users from using itsour products and services. Any disruptions could increase costs and make profitability even more difficult to achieve.
We will need to introduce new products and services and enhance existing products and services to remain competitive.
Our future success depends in part on our ability to develop and enhance our products and services. In addition, the adoption of new Internet, networking or telecommunications technologies or other technological changes could require us to incur substantial expenditures to enhance or adapt our services or infrastructure. There are significant technical and financial costs and risks in the development of new or enhanced products and services, including the risk that we might be unable to effectively use new technologies, adapt our services to emerging industry standards, or develop, introduce and market enhanced or new products and services. An inability to develop new products and services, or enhance existing offerings, could have a material adverse effect on our profitability.
We rely on external service providers to perform certain key functions.
We rely on a number of external service providers for certain key technology, processing, service, and support functions. External content providers provide us with crypto mining services, financial information, market news, charts, option and stock quotes, research reports, and other fundamental data that we offer to clients. These service providers face technological and operational risks of their own. Any significant failures by them, including improper use or disclosure of our confidential client, employee, or company information, could cause us to incur losses and could harm our reputation.
We cannot assure that any external service providers will be able to continue to provide these services in an efficient, cost-effective manner or that they will be able to adequately expand their services to meet our needs. An interruption in or the cessation of service by any external service provider as a result of systems failures, capacity constraints, financial constraints or problems, unanticipated trading market closures, or for any other reason, and our inability to make alternative arrangements in a smooth and timely manner, if at all, could have a material adverse effect on our business, results of operations, and financial condition.
We could face liability and other costs relating to storage and use of personal information about itsour users.
Users provide the Companyus with personal information, including tax identification numbers, which it doeswe do not share without the user’s consent. Despite this policy of obtaining consent, however, if third persons were able to penetrate the Company’sour network security or otherwise misappropriate itsour users’ personal information. The company doesinformation, we could be subject to liability, including claims for unauthorized purchases with credit card information, impersonation or other similar fraud claims, and misuses of personal information, such as for unauthorized marketing purposes. New privacy legislation may further increase this type of liability. Furthermore, we could incur additional expenses if additional regulations regarding the use of personal information were introduced or if federal or state agencies were to investigate our privacy practices. We do not store user credit card information and reliesrely upon itsour merchant processing partners to collect and store this information with the necessary Payment Card Industry Security Standards compliance in place. However, a breach of the merchant’s security standards could create liability for the company.
Our business could be negatively affected if we are required to defend allegations of unfair competition and government regulation of the Internet could adversely affect the Company’s business.
Advertising and marketing of our products in the United States are also subject to regulation by the FTCFederal Trade Commission (“FTC”) under the Federal Trade Commission Act, or FTC Act. Among other things, the FTC Act prohibits unfair methods of competition and unfair false or deceptive acts or practices in or affecting commerce. The FTC Act also makes it illegal to disseminate or cause to be disseminated any false advertisement. The FTC routinely reviews websites to identify questionable advertising claims and practices. Competitors sometimes inform the FTC when they believe other competitors are violating the FTC Act and consumers also notify the FTC of what they believe may be wrongful advertising. The FTC may initiate a non-publicnonpublic investigation that focuses on our advertising claims, which usually involves non-publicnonpublic, pre-lawsuit, extensive formal discovery. Such an investigation may be verylengthy and expensive to defend be lengthy, and result in a publicly disclosed Consent Decree, which is aconsent decree or settlement agreement. If no settlement can be reached, the FTC may start an administrative proceeding or a federal court lawsuit against us or our principal officers. The FTC often seeks to recover from the defendants, whether in a Consent Decreeconsent decree or a proceeding, any or all of the following: (i) consumer redress in the form of monetary relief or disgorgement of profits; (ii) significant reporting requirements for several years; and (iii) injunctive relief. In addition, most, if not all, states have statutes prohibiting deceptive and unfair acts and practices. The requirements under these state statutes are similar to those of the FTC Act.
We accept and hold cryptocurrencies, which may subject us to exchange risk and additional tax and regulatory requirements
We have recently begun accepting cryptocurrencycryptocurrencies bitcoin and etherium as a form of payment. Cryptocurrencies are not considered legal tender or backed by any government and have experienced significant price volatility, technological glitches, and various law enforcement and regulatory interventions. If we fail to comply with regulations or prohibitions applicable to us, we could face regulatory or other enforcement actions and potential fines and other consequences. We also hold cryptocurrencies directly, and we havesubjecting us to exchange rate risk on the amounts we hold as well as the risksrisk that regulatory or other developments and the recent price volatility may adversely affect the value of the cryptocurrencies we hold. The uncertainties regarding legal and regulatory requirements relating to cryptocurrencies or transactions using cryptocurrencies, as well as potential accounting and tax issues or other requirements relating to cryptocurrencies, could have a material adverse effect on our business.
Our business could be negatively affected if we are required to defend allegations that our direct selling activities are fraudulent or deceptive schemes, are against public interest, or are the sale of unregistered securities.
Direct selling activities are regulated by the FTC, as well as various federal, state, and local governmental agencies in the United States and foreign countries. These laws and regulations are generally intended to prevent fraudulent or deceptive schemes, often referred to as “pyramid” schemes, which compensate participants primarily for recruiting additional participants without significant emphasis on product sales. Regulators may take the position that some or all of our products are deemed to be securities, the sale of which has not been registered.
Our independent distributors could fail to comply with applicable legal requirements or our distributor policies and procedures, which could result in claims against us that could harm our business.
Our independent distributors are independent contractors and, accordingly, we are not in a position to directly provide the same oversight, direction, and motivation as we could if they were our employees. As a result, we cannot assure that our independent distributors will comply with applicable laws or regulations or our distributor policies and procedures.
Extensive federal, state, local, and international laws regulate our business, products and direct selling activities. Because we have expanded into foreign countries, our policies and procedures for our independent distributors differ slightly in some countries due to the different legal requirements of each country in which we do business.
Our proprietary systems may be compromised by hackers.
Our current products and other products and services that we may develop in the future will be based on proprietary software and customer-specific data that we protect by routine measures such as password protection, confidentiality and nondisclosure agreements with employees, and similar measures. Any unauthorized access to our software or data could materially disrupt our business and result in financial loss and damages to our business reputation.
Our future success is largely dependent on our current management.
Our business was built by the vision, dedication, and expertise of our officers Ryan Smith, Annette Raynor, Chad Miller, Mario Romano, and William Kosoff, who are responsible for our day-to-day operations and creative development. Our success is dependent upon the continued efforts of these people. If it became necessary to replace them, it is unlikely new management could be found that would have the same level of knowledge and dedication to our success. The loss of the services of these professionals, especially in the development of future proprietary software, patents, or applications, would adversely affect our business.
Risks Related to Our Common Stock
We have a history of operating losses and expect to report future losses that may cause our stock price to decline.
For the operating period since inception through March 31, 2018,2019, we have reported an accumulated deficit of $20,067,403.$25,096,983. We reported a net loss of $14,913,016$5,011,036 for the year ended March 31, 20182019, and a net loss from operations of $10,676,154.$3,940,856. We cannot be certain whether we will ever bebecome profitable, or if we do, that we will be able to continue to be profitable. Also, any economic weakness or global recession may limit our ability to market our products. Any of these factors could cause our stock price to decline and result in youinvestors losing a portion or all of yourtheir investment.
We may choosewill need to raise additional capital.
Because our revenues are not yet sufficient to cover expenses or fund our growth, we need to secure ongoing funding. If we are unable to obtain adequate additional financing, we may not be able to successfully market and sell our products, our business operations will most likely be discontinued, and we will cease to be a going concern. To secure additional financing, we may need to borrow money or sell more securities. Under these circumstances, we may be unable to secure additional financing on favorable terms or at all. Selling additional stock, either privately or publicly, would dilute the equity interests of our stockholders. If we borrow money, we will have to pay interest and may also have to agree to restrictions that limit our operating flexibility. If we are unable to obtain adequate financing, we may have to curtail business operations, which would have a material negative effect on operating results and most likely result in a lower stock price.
Our common stock price has been and may continue to be extremely volatile.
Our common stock has experiencedclosed as low as $0.006 per share and as high as $0.0315 per share during the most recent fiscal year. We believe this volatility may be caused, in the past, and is expected to experience in the future, significant price and volume volatility, which substantially increases the risk that you may not be able to sell your shares at or above the price that you pay for the shares.
Additionally, in recent years the stock market in general, and the Over-the-Counter Bulletin BoardOTC Markets and technology stocks in particular, have experienced extreme price and volume fluctuations. In some cases, these fluctuations are unrelated or disproportionate to the operating performance of the underlying company. These market and industry factors may materially and adversely affect our stock price regardless of our operating performance. The historical trading of our common stock is not necessarily an indicator of how it will trade in the future and our trading price as of the date of this prospectusreport is not necessarily an indicator of what the trading price of our common stock might be in the future.
In the past, class action litigation has often been brought against companies following periods of volatility in the market price of those companies’ common stock. If we become involved in this type of litigation in the future it could result in substantial costs and diversion of management attention and resources, which could have a further negative effect on your investment in our stock.
We cannot assure that we will continue to be limited due to resale restrictions under applicable securities laws and the fact that approximately 39% of our outstanding shares are held by officers, directors and stockholders holding greater than a 5% interest in the Company. As a result of the limited trading market for our common stock and the lack of analyst coverage, the market price for our shares may continue to fluctuate significantly and will likely be more volatile than the stock market as a whole. There may be a limited demand for shares of our common stock due to the reluctance or inability of certain investors to buy stocks quoted for trading on the OTC Bulletin Board, lack of analyst coverage of our common stock and limited trading market for our common stock. As a result, even if prices appear favorable, there may not be sufficient demand to complete a stockholder’s sell order. Without an active public trading market or broader public ownership, shares of our common stock are likely to be less liquid than the stock of public companies with broad public ownership and an active trading market, and any of our stockholders who attempt to sell their shares in any significant volumes may not be able to do so at all, or without depressing the publicly quoted bid prices for our shares.
If we fail to file periodic reports with the U.S. Securities and Exchange Commission, our common stock will not be subjectable to be traded on the “Penny Stock” rules promulgated byOTCQB.
Although our common stock trades on the OTCQB, a regular trading market for our common stock may not be sustained in the future. OTC Markets limits quotation on the OTCQB to securities of issuers that are current in their reports filed with the Securities and Exchange Commission.
Because our common stock is considered a “penny stock,” any investment in our shares is considered to be a high-risk investment and is subject to restrictions on marketability.
Our common stock is considered a “penny stock” on the OTC Markets as it currently trades for less than $5.00 per share. The OTC Market system is generally regarded as a less efficient trading market than the Nasdaq Capital or Global Markets. The Securities and Exchange Commission has adopted Rule 15g-9 which establishes the definition ofrules that regulate broker-dealer practices in connection with transactions in “penny stocks.” Penny stocks generally are equity securities with a "penny stock," for the purposes relevant to us, as any equity security that has a market price of less than $5.00 per share(other than securities registered on certain national securities exchanges or with an exercisequoted on the Nasdaq system, provided that current price of less than $5.00 per share, subject to certain exceptions. For any transaction involving aand volume information respecting transactions in these securities is provided by the exchange or system). The penny stock unless exempt, the rules require:
Because we have no plans to pay dividends on our common stock, stockholders must look solely to appreciation of our common stock to realize a gain on their investments.
We do not anticipate paying any dividends on our common stock in the foreseeable future. We currently intend to retain future earnings, if any, to finance the expansion of our business. Our future dividend policy is within the discretion of our board of directors and will depend upon numerous factors, including our business, financial condition, results of operations, capital requirements, and investment opportunities. In addition, our senior credit facility limits the payment of dividends without the prior written consent of the lenders. Accordingly, stockholders must look solely to appreciation of our common stock to realize a gain on their investment. This appreciation may not occur.
Certain provisions of Nevada law and of our corporate charter may inhibit a potential acquisition of our Company,company, and this could depress our stock price.
Nevada corporate law includes provisions that could delay, defer, or prevent a change in control of our company or our management. These provisions could discourage information contests and make it more difficult for you and otherour stockholders to elect directors and take other corporate actions. As a result, these provisions could limit the price that investors are willing to pay in the future for shares of our common stock. For example:
| ● | without prior stockholder approval, our board of directors has the authority to issue one or more classes of preferred stock with rights senior to those of our common stock and to determine the rights, privileges, and preferences of that preferred stock; | |
| ● | there is no cumulative voting in the election of directors, which would otherwise allow less than a majority of stockholders to elect director candidates; and | |
| ● | stockholders cannot call a special meeting of stockholders. |
Our indemnification of our directors and officers may limit the rights of our stockholders.
While our board of directors and officers are generally accountable to our stockholders and us, the liability of our directors and officers to all parties is limited in certain respects under applicable state law and our articles of incorporation and bylaws, as in effect. Further, we have agreed or may agree to indemnify our directors and officers against liabilities not attributable to certain limited circumstances. This limitation of liability and indemnity may limit rights that our stockholders would otherwise have to seek redress against our directors and officers.
Additional issuances of stock options and warrants, convertible notes, and stock grants will cause additional substantial dilution to our stockholders.
Given our limited cash, liquidity, and revenues, it is likely that in the future, as in the past, we will issue additional warrants, stock grants, and convertible debt to finance our future business operations and acquisitions and strategic relationships. The issuance of additional shares of common stock, the exercise of warrants, and the conversion of debt to determinestock could cause additional dilution to our stockholders and could have further adverse effects on the rights, privileges and inferencemarket price for our securities or on our ability to obtain future financing. The 2018 increase in our authorized shares from two billion to ten billion increased the magnitude of this risk substantially.
The amount of authorized common stock may result in management implementing anti-takeover procedures by issuing new securities.
The proportion of unissued authorized shares to issued shares could, under certain circumstances, have an anti-takeover effect, for example, by permitting issuances that preferred stock;
ITEMItem 1B. UNRESOLVED STAFF COMMENTSUnresolved Staff Comments
None.
Our headquarters isare located at 12 South 400 West, Salt Lake City, Utah 84101 and isare currently leased on a month-to-month lease arrangement.basis. Corporate Finance iswas located in office space at 745 Hope Road, Eatontown, New Jersey, which is on a month-to-month lease. The Company will maintainlease, however in June of 2019, we signed a three-year lease agreement for office space at 234 Industrial Way West, Building A, Suite 202, in Eatontown, New Jersey. Corporate Finance is expected to occupy the month-to-month lease arrangement until it can determine propernew office utilization based on expansionspace beginning in July of key departments including finance and customer support services.
In the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse resultbusiness, we may be or have been involved in these or other matters may ariselegal proceedings from time to time that may harm our business. The Company’stime. Below is a description of all legal proceedings or claims as ofwe were involved in during the year ended March 31, 20182019, and through the date of this report are as follows:
| ● | On November 1, 2017, we filed a lawsuit in the Fourth Judicial District Court for Utah County, State of Utah, Wealth Generators, LLC, v. Evan Cabral, Daniel Lopez, John Legarreta, Johnathan Lopez, Julian Kuschner, Nick Gomez, Luke Shulla, Nestor Velazquez, Christopher Terry, Isis De La Torre, Alex Morton, Ivan Briongos, Brandon Boyd, and International Markets Live Ltd. d/b/a iMarketslive, Civil No. 170401615, alleging corporate espionage and misappropriation of corporate information. The lawsuit alleges that International Markets Live Ltd., dba iMarketslive, conspired with a number of individuals affiliated with Wealth Generators to steal our confidential information, intellectual property, and trade secrets.On September 27, 2018, the court issued its ruling granting in part and denying in part our motion for preliminary injunction. On January 2, 2019, the parties entered into a settlement agreement in which they agreed to release all claims and have the litigation dismissed with prejudice, with neither party making any payment to the other, but with the defendants agreeing to make a $5,000 donation to charity. On February 22, 2019, the matter was dismissed with prejudice. | |
| ● | In February 2018, we received a subpoena from the United States Commodity Futures Trading Commission (“CFTC”). We complied with the terms of the subpoena, negotiated a resolution of this matter with the CFTC staff, and a final order was issued on September 14, 2018. Under the order, we did not admit or deny any of the allegations, agreed to pay a fine of $150,000, and agreed not to act as an unregistered commodities trading advisor in the future. As of March 31, 2019, we have paid $90,000 to the CFTC and the remaining unpaid balance has been included in accounts payable and accrued liabilities on our consolidated balance sheet. | |
| ● | Jim Westphal filed a wage claim against Kuvera, LLC (at the time named Wealth Generators, LLC), in the United States District Court for the District of Utah, Central Division (Case No. 2:18-cv-00080) in the amount of $6,500 plus liquidated damages. Mr. Westphal is claiming unpaid overtime wages. We contend that Mr. Westphal was an independent contractor, hired on a limited basis to perform software services, and is accordingly not entitled to overtime payments under the Fair Labor Standards Act. Moreover, Mr. Westphal never provided the promised software pursuant to the parties’ agreement. We filed a counterclaim on July 12, 2018, seeking damages of approximately $20,000 and demanding a jury trial. In December 2018, the parties settled the matter with a joint motion. As a result of the settlement, we paid Mr. Westphal $1,500 and the case was dismissed. | |
| ● | In April of 2019, we received a summons and complaint from Fibernet Corp making claims of unpaid invoices and breach of contracts entered into in February 2012 and January 2015 as RazorData Corp. Without admitting fault or liability, in June of 2019, we entered into an agreement with Fibernet Corp to settle all claims and release us from any future claims in exchange for a payment of $35,160 to avoid ongoing litigation related to this matter. |
None of our directors, officers, or affiliates areis involved in a proceeding adverse to our business or havehas a material interest adverse to our business.
Not applicable
Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our common stock is traded on the OTCQB under the symbol “INVU”. During a period in 2016 prior to the Reverse Acquisition with Wealth Generators LLC on March 31, 2017, the Company was downgraded to the OTC Pink Sheets. After the Acquisition the new management team requalified and uplisted the Company back onto the OTCQB on October 2, 2017.“INVU.” The following table sets forth the range of low and high and low bidclosing sale prices for our common stock for each of its Common Stock,the periods indicated as reported and summarized by the OTCQB for the last two fiscal years and subsequent quarterly periods. The quotations set forth below reflect inter-dealer prices, without retail mark-up, markdown or commission and may not represent actual transactions.
2018 Fiscal Year | ||
High | Low | |
| April 1, 2018 - June 22, 2018 | $0.034 | $0.011 |
| January 1, 2018 - March 31, 2018 | $0.070 | $0.027 |
| October 1, 2017 - December 31, 2017 | $0.089 | $0.051 |
| July 1, 2017 - September 30, 2017 | $0.080 | $0.023 |
| April 1, 2017 - June 30, 2017 | $0.038 | $0.004 |
2017 Fiscal Year | ||
High | Low | |
| January 1, 2017 - March 31, 2017 | $0.005 | $0.002 |
| October 1, 2016 - December 31, 2016 | $0.012 | $0.002 |
| July 1, 2016 - September 30, 2016 | $0.013 | $0.003 |
| April 1, 2016 - June 30, 2016 | $0.100 | $0.007 |
| Low | High | |||||||
| 2020: | ||||||||
| First Quarter | $ | 0.008 | $ | 0.037 | ||||
| 2019: | ||||||||
| Fourth Quarter | $ | 0.008 | $ | 0.037 | ||||
| Third Quarter | $ | 0.006 | $ | 0.020 | ||||
| Second Quarter | $ | 0.010 | $ | 0.030 | ||||
| First Quarter | $ | 0.011 | $ | 0.030 | ||||
| 2018: | ||||||||
| Fourth Quarter | $ | 0.024 | $ | 0.070 | ||||
| Third Quarter | $ | 0.051 | $ | 0.100 | ||||
| Second Quarter | $ | 0.064 | $ | 0.080 | ||||
| First Quarter | $ | 0.005 | $ | 0.070 | ||||
| 2017: | ||||||||
| Fourth Quarter | $ | 0.002 | $ | 0.010 | ||||
| Third Quarter | $ | 0.002 | $ | 0.010 | ||||
| Second Quarter | $ | 0.003 | $ | 0.010 | ||||
| First Quarter | $ | 0.007 | $ | 0.100 | ||||
As of March 31,2018, there wereJune 27, 2019, we had approximately 549 holders573 stockholders of record of the Company’sour common stock and 2,169,661,3182,679,376,966 shares of common stock issued and outstanding.
Dividends
Holders of shares of common stock are entitled to share pro rata in dividends and distributions for the common stock when, as, and if declared orby the board of directors out of funds legally available therefor. We have not paid any cash or stock dividends on itsour common stock. The Company currently intendsstock and intend to retain future earnings, if any, to finance the development and expansion of itsour business. AsFuture dividend policy is subject to the discretion of the board of directors and will depend upon a result, the Company does not anticipate paying any cash dividends in the foreseeable future.
| Plan Category | Number of securities to be issued upon exercise of outstanding options and warrants | Weighted-average exercise price of outstanding options and warrants | Number of securities remaining available for future issuance underequity compensation plans |
| Equity compensation plans approved by security holders | 0 | N/A | 0 |
| Equity compensation plan not approved by security holders | 35,000 | $10.00 | 18,348 |
Recent Sales of Unregistered Securities
On January 11, 2019, we entered into a convertible promissory note in the three months endedamount of $138,000, with Power Up Lending Group, Ltd. and received proceeds of $138,000. The note incurs interest at 12% per annum and has a maturity date of April 11, 2020.
In March 31, 20182019, we issued 1,000,000 shares of our common stock to an employee as compensation.
The securities represented by each of the Companytransactions described above were issued 20,000,000in reliance on the exemption from registration provided in Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving any public offering. Each of the investors is either an “accredited investor” as defined in Rule 501(a) of Regulation D or a sophisticated investor able to bear the risks of the investment. Each investor confirmed the foregoing and acknowledged that the securities must be acquired and held for investment. All certificates evidencing the shares of common stock on conversion of the notes, issuances under the restricted stock grants, or upon the exercise of the warrants will bear a restrictive legend. No underwriter participated in exchange for $425,000the offer and sale of cash proceeds.
In May and June of 2019, we issued 667,000an aggregate of 39,215,648 shares of our common stock with a valueto Triton Funds LP (“Triton”) under the common stock purchase agreement that was entered into in December 2018 and amended in March and April 2019, for net proceeds of $18,676 for consulting services.
We are not required to provide the information under this item.
Plan of Operations
The following discussion should be read in conjunction with our consolidated financial statements and notes to our financial statements included elsewhere in this report. This discussion contains forward-looking statements that involve risks and uncertainties. When the re-brandwords “believe,” “expect,” “plan,” “project,” “estimate,” and similar expressions are used, they identify forward-looking statements. These forward-looking statements are based on management’s current beliefs and assumptions and information currently available to management, and involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by these forward-looking statements. Information concerning factors that could cause our actual results to differ materially from these forward-looking statements can be found in our periodic reports filed with the U.S. Securities and Exchange Commission. The forward-looking statements included are made only as of Wealth Generators successfully completedthe date of this report. We disclaim any obligation to update any forward-looking statements whether as a result of new information, future events, or otherwise.
Acquisition
On July 20, 2018, we entered into a Purchase Agreement with United Games Marketing LLC, a Utah limited liability company, to purchase its wholly owned subsidiaries United Games, LLC and United League, LLC (collectively “United Games”) for 50,000,000 shares of our common stock. The deal includes the purchase of the Utah-based companies’ wholly owned technology, staff, and trademarks, including the well-known FireFan mobile app.
United Games is a social gaming environment accessed through its FireFan mobile app and sold primarily through United Games affiliates. This acquisition provides us a wholly owned subsidiary that provides key synergies to our largest subsidiary, Kuvera, we will shift focusLLC. The acquisition of United Games brings these key benefits:
Customizable back office
Customizable commission engine
FireFan game/mobile app
FireFan brand (registered and trademarked)
In-house development team to the following strategic activities:
Existing incoming revenue
Multiple newly engaged affiliates
An extensive network of content language translation.
19,000 active paying members
Access to a New Jersey based Registered Investment Advisor wholly owned by the Company to provide advisory services to strategic alliances identified by Investview.
Our management team is on-going.
Results of Operations
Year Ended March 31, 2019, Compared to Year Ended March 31, 2018
Revenues
Revenue, net, increased $5,044,485,$11,741,649, or 39%66%, from $12,872,947 for the year ended March 31, 2017 to $17,917,432 for the year ended March 31, 2018. 2018, to $29,659,081 for the year ended March 31, 2019. The majority of the increase ($4,017,853) can be explained by our introductionincrease in subscription sales of cryptocurrency mining services as a new product.$13,123,623, which related largely to our establishment of Kuvera France, S.A.S. in November of 2018 and sales occurring in the European Union during the current year compared to no such sales in the prior year. The remainder of the increase was due to a decreaseour sales of equipment in chargebacks and refunds fromthe current year, versus no such sales in the prior year.year, explaining $694,954 of the increase. Our gross billings increased by 62%48%, or $9,066,248,$11,348,471, to $34,992,883 in the year ended March 31, 2019, versus $23,644,412 in the year ended March 31, 2018 versus $14,578,164 in the year ended March 31, 2017;2018; however, this was offset by refunds, incentives, credits, chargebacks, and amounts paid to suppliers.
Operating Costs
Operating costs increased $13,782,979,$5,006,351, or 93%18%, from $14,810,607 for the year ended March 31, 2017 to $28,593,586 for the year ended March 31, 2018. This was due2018, to an increase in our cost of sales and service of $5,850,248, an increase in commissions of $4,859,271, an increase in professional fees of $1,655,523, and an increase in general and administrative costs of $1,111,464. The increases could mostly be explained by our issuance of 174,375,333 million shares being issued in exchange for entering into a license agreement, a cloud mining agreement, and several consulting agreements, resulting in $6,846,059 worth of expense being recorded during the year ended March 31, 2018. Additionally, there were increases in commissions due to increasing revenues, the growth of the distribution network, and bonus programs in place that did not exist in the prior year. Lastly, there were increases due to larger amounts paid for increasing marketing and development efforts, as well as increases in accounting, audit, and legal fees associated with our reverse acquisition that was effective April 1, 2017, our public company filing requirements, and our agreements entered into during the period.
Other Income (Expense)
Other income (expense) went from $(4,212,273) for the year ended March 31, 2018. 2018, to $(966,471) for the year ended March 31, 2019. The increasedecrease is due to the loss on debt extinguishment and the loss on spin-off of operations during the year ended March 31, 2018, as compared to no such expense in the priorcurrent period. Additionally, during the year ended March 31, 2018, we issued 239,575,884 shares of our common stock in settlement of debt, wherein accrued liabilities, principal, accrued interest, and derivative liabilities were extinguished in the amounts of $430,892, $2,348,606, $20,696, and $38,557, respectively, and we recognized a loss on the settlement of debt in the amount of $3,186,394 in the statement of operations.
Liquidity and Capital Resources
During the year ended March 31, 2018,2019, we incurred a loss of $14,913,016.$5,011,036. However, only $1,045,665$2,983,251 was cash related. This negative cash flow was funded by borrowing $498,380$1,905,777 from related parties and proceeds of $1,675,000$4,115,961 from new lending arrangements, and proceeds of $3,121,776 from the sale of common stock, offset by repayments of $1,316,500$1,367,168 to related parties and $1,424,578$2,936,044 on debt.debt, along with $91,000 paid to repurchase our common stock. As a result, our cash and cash equivalents increaseddecreased by $1,498,070$1,357,042 to $1,490,686$133,644 as compared to $1,616$1,490,686 at the beginning of the fiscal year.
As of March 31, 2018,2019, our current liabilities exceeded our current assets equal to a working capital deficit of $3,919,260.$2,222,990. A year ago, at March 31, 2017,2018, the working capital deficit was $4,247,684. Most significantly, our debt was reduced through conversions into common stock, stock issued for liabilities and for services, and debt paid off during the year ended March 31, 2018.
The above matters, among others, raise substantial doubt about our ability to continue as a going concern. During the year ended March 31, 2018,2019, we raised $498,380$1,905,777 in cash proceeds from related parties $1,675,000and $4,115,961 in cash proceeds from new lending arrangements. Subsequent to March 31, 2019, we obtained $200,000 in cash proceeds from new lending arrangements and $3,121,776received $325,000 from the sale of our common stock. Additionally, during the year ended March 31, 2018, we exchanged $2,322,606 worth
Since our acquisition of debt into sharesWealth Generators in April of common stock. Going forward we plan to reduce obligations with cash flow provided by operations and pursue additional debt and equity financing; however, we cannot assure that funds will be available on terms acceptable to us, or if available, will be sufficient to enable us to fully complete our development activities or sustain operations. Nevertheless, the shortage of working capital adversely affects our ability to develop or participate in activities that promote our business, because a substantial portion of cash flow goes to reduce debt rather than to advance operating activities. To address this,2017 we have implemented a seriesnumber of adjustmentsinitiatives and we are beginning to its affiliate/distributor bonus plan. These adjustments are designed to bringsee the maximum payout percentage in line with company objectives. During the period, thepositive impact of these actions. First, our largest subsidiary, Kuvera, has a bonus plan exceeded maximum payout on three occasions andstructure for distributors of our services which consistently paid out nearbeyond our maximum threshold. Adjustments to this bonus plan have been made over the maximum percentage.last 12 months with additional adjustments planned for the next two quarters. This resulted in a gradual reduction in bonus payouts which reduced our losses. Second, we expanded the objectives of Investview through the acquisition and creation of additional subsidiaries to increase our sources of income and creating business activities in new sectors which includes:
| ● | Fully licensing SAFE Management LLC as a Registered Investment Advisor and Commodities Trading Advisor. This was done so SAFE Management could offer fully managed trading services to individuals who lacked the time to trade for themselves and provide reasonable advisory fees and minimum investment amounts to service individuals who do not meet the requirements of Qualified Investors. | |
| ● | We acquired the assets of United Games LLC and United League LLC which provided us highly experienced management, programmers, marketing and compliance personnel along with key technology components such as a fully coded back office and trademarked FIREFAN app. We are still in the process of adapting their technology to Kuvera operations and working on various distribution plans for FIREFAN. | |
| ● | We changed the name of our subsidiary WealthGen Global, which was an unused entity, to SAFETek LLC in preparation for our entry into the high-performance computing space to meet the needs of 4IR (Fourth Industrial Revolution) business needs which includes mining, blockchain technologies, gaming, artificial intelligence and 3-Dimensional rendering. This will enable us to provide HPC services to small, medium and startup entities who require specialized high-speed processing but cannot afford the infrastructure. By leasing our processing to these companies, we will aid these entities in bringing their products, inventions, improvements to market. | |
| ● | We have designed a program through Joint Venture known as APEX which enables individuals to purchase highly customized processing cards which SAFETek will lease from the purchasers for a fixed period of time at a fixed monthly lease payment. This enables individuals to participate in emerging growth without experiencing the volatility and potential loss experienced in the sector. |
These companies provide Investview a stake in 4IR, HPC, app development, fintech, blockchain and personal money management sectors. Each of these are areas that are targeted for significant growth spurred by innovations through technology.
While our liabilities are larger than our assets it is important to note that we seek to keep operating expenses low. The assets we have acquired and will continue to seek out are those of technology, mobile apps, and human resources. These assets are not easily defined on our balance sheet but represent our ability to carry out our objectives which we believe will ultimately generating positive cash flow, reduced debt and then profitability.
Further, while we have reported reoccurring losses and have an operating capital deficiency, we have been able to establish multiple companies to create various revenue streams as we move forward. Our largest challenge is operational cash flow as lending arrangements continue to be expensive causing us to deploy incoming cash to prior debt. We believecontinue to seek short term capital in arrangements that are partnership based with elements of debt and equity combined. Additionally, our immediate focus is the adjustments initiated will reduce the payout slowly over a three-month period with payout percentages closer to 60%.
Critical Accounting Policies
The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and judgments that affect our reported assets, liabilities, revenues, and expenses, and the disclosure of contingent assets and liabilities. We base our estimates and judgments on historical experience and on various other assumptions we believe to be reasonable under the circumstances. Future events, however, may differ markedly from our current expectations and assumptions. While there are a number of significant accounting policies affecting our consolidated financial statements; we believe the following critical accounting policy involves the most complex, difficult, and subjective estimates and judgments.
Basis of Accounting
Our policy is to prepare itsour financial statements on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
Principles of Consolidation
The consolidated financial statements include the accounts of Investview, Inc., and our wholly owned subsidiaries, Kuvera, LLC, Investment Tools & Training, LLC, Razor Data Corp., and SAFE Management, LLC. We have determined that one affiliated entity, Kuvera LATAM S.A.S., which we conduct business with, is a variable interest entity and we are the primary beneficiary of the entitiesentity’s activities. As a result, we have consolidated the accounts of this variable interest entity into the accompanying consolidated financial statements. All intercompany transactions and balances have been eliminated in consolidation.
Use of Estimates
The preparation of these financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Revenue Recognition
Effective April 1, 2018, we adopted the Financial Accounting Standards Board Accounting Standards Codification (“ASC”) Subtopic 606-10, Revenue from Contracts with Customers (“ASC 606-10”). The adoption of ASC 606-10 had no impact on prior year or previously disclosed amounts. In accordance with FASB ASC Subtopic 605-10, Revenue Recognition, which requires that four basic criteria must be met before606-10, revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3)is measured based on a consideration specified in a contract with a customer and recognized when we satisfy the selling price is fixed and determinable; and (4) collectability is reasonably assured.
The majority of our revenue is generated by subscription sales and payment is received at the time of purchase. WeOur performance obligation is to provide services over a fixed subscription period; therefore, we recognize revenue for subscription salesratably over the subscription period and deferred revenue is recorded for the portion of the subscription period subsequent to each reporting date. Additionally, we offer a 10-day trial period to subscription customers, during which a full refund can be requested if a customer does not like the product. Revenues are deferred during the trial period as collectability cannot be reasonably assuredcollection is not probable until that time has passed. Revenues are presented net of refunds, sales incentives, credits, known and estimated refunds, and known and estimated credit card chargebacks.
We generate revenue from the sale of cryptocurrency mining services to our customers through ouran arrangement with a third-party supplier. We report net revenue retainedOur performance obligation is to arrange for the third-party to provide mining services to our customers and payment is received at the time of purchase, therefore revenue is recognized upon receipt of payment. We recognize revenue in the amount of the fee to which represents our fees earnedwe are entitled to as an agent.
We generate revenue from the sale of high-speed computer processing equipment that is used for any of the following intense processing activities: protein folding, CGI rendering, game streaming, machine and deep learning, mining, independent financial verification, and general high-speed computing. Our performance obligation is to deliver an equipment package to our customers that includes hardware, software, and firmware and is drop-shipped to a hosting data center. We receive payment at the time of purchase and recognize revenue when the equipment package is delivered and ready for maintenance and hosting, which our customers arrange for, and obtain, from a separate third party that provides such services.
Revenue generated for the yearsyear ended March 31, 2019, was as follows:
| Subscription Revenue | Equipment Sales | Cryptocurrency Mining Revenue | Total | |||||||||||||
| Gross billings | $ | 28,518,660 | $ | 698,954 | $ | 5,775,269 | $ | 34,992,883 | ||||||||
| Refunds, incentives, credits, and chargebacks | (1,495,458 | ) | (4,000 | ) | (6,501 | ) | (1,505,959 | ) | ||||||||
| Amounts paid to supplier | - | - | (3,827,843 | ) | (3,827,843 | ) | ||||||||||
| Net revenue | $ | 27,023,202 | $ | 694,954 | $ | 1,940,925 | $ | 29,659,081 | ||||||||
Revenue generated for the year ended March 31, 2018, and 2017, iswas as follows:
March 31, 2018 | March 31, 2017 | |||||
Subscription Revenue | Cryptocurrency Mining Revenue | Total | Subscription Revenue | Cryptocurrency Mining Revenue | Total | |
| Gross billings | $14,758,614 | $8,885,798 | $23,644,412 | $14,578,164 | $- | $14,578,164 |
| Refunds, incentives, credits, and chargebacks | (859,035) | - | (859,035) | (1,705,217) | - | (1,705,217) |
| Amounts paid to supplier | - | (4,867,945) | (4,867,945) | - | - | - |
| Net revenue | $13,899,579 | $4,017,853 | $17,917,432 | $12,872,947 | $- | $12,872,947 |
| Subscription Revenue | Equipment Sales | Cryptocurrency Mining Revenue | Total | |||||||||||||
| Gross billings | $ | 14,758,614 | $ | - | $ | 8,885,798 | $ | 23,644,412 | ||||||||
| Refunds, incentives, credits, and chargebacks | (859,035 | ) | - | - | (859,035 | ) | ||||||||||
| Amounts paid to supplier | - | - | (4,867,945 | ) | (4,867,945 | ) | ||||||||||
| Net revenue | $ | 13,899,579 | $ | - | $ | 4,017,853 | $ | 17,917,432 | ||||||||
Recent Accounting Pronouncements
In May 2014,February 2016, the FASB issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with CustomersASU No. 2016-02, “Leases (Topic 606)842)”.ASU 2014-09 creates a new topic in the ASC Topic 606 and establishes a new control-based revenue recognition model,2016-02 changes the basisaccounting for deciding when revenueleased assets, principally by requiring balance sheet recognition of assets under lease arrangements. It is recognized over time or at a point in time, provides new and more detailed guidance on specific topics, and expands and improves disclosures about revenue. In addition, ASU 2014-09 adds a new Subtopic to the Codification, ASC 340-40, Other Assets and Deferred Costs: Contracts with Customers, to provide guidance on costs related to obtaining a contract with a customer and costs incurred in fulfilling a contract with a customer that are not in the scope of another ASC Topic. The guidance in ASU 2014-09 is effective for public entities for annual reporting periods, and interim periods within those years, beginning after December 15, 2017, including interim periods therein. Early application is not permitted. Management is2018. In June of 2019, we signed a three-year lease agreement for office space in Eatontown, New Jersey, therefore we will adopt this standard effective April 1, 2019 and will account for our new lease agreement accordingly. We note that the processadoption of assessing theASU 2016-02 will have no other impact of ASU 2014-09 on the Company’sour consolidated financial statements.
There are no additional recently issued accounting pronouncements that we have not yet adopted that we believe are applicable or would have a material impact on our financial statements.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, and results of operations, liquidity, or capital expenditures.
Trends, Risks, and Uncertainties
We have sought to identify what we believe to be the most significant risks to our business, but we cannot predict whether, or to what extent, any of such risks may be realized nor can we guarantee that we have identified all possible risks that might arise. Investors should carefully consider all of such risk factors before making an investment decision with respect to our Common Stock.
Cautionary Factors That May Affect Future Results
We have sought to identify what we believe are significant risks to our business, but we cannot predict whether, or to what extent, any of such risks may be realized nor can we guarantee that we have identified all possible risks that might arise.
Potential Fluctuations in Annual Operating Results
Our annual operating results may fluctuate significantly in the future as a result of a variety of factors, most of which are outside our control, including: the demand for our products and services; seasonal trends in purchasing, the amount and timing of capital expenditures and other costs relating to the commercial and consumer financing; price competition or pricing changes in the market; technical difficulties or system downtime; general economic conditionsconditions; and economic conditions specific to the consumer financing sector.
Our annual results may also be significantly impacted by the accounting treatment of acquisitions, financing transactions, or other matters. Particularly at our early stage of development, such accounting treatment can have a material impact on the results for any quarter. Due to the foregoing factors, among others, it is likely that our operating results may fall below our expectations or those of investors in some future quarter.
Management of Growth
We may experience growth, which will place a strain on our managerial, operational, and financial systems resources. To accommodate our current size and manage growth if it occurs, we must devote management attention and resources to improve our financial strength and our operational systems. Further, we will need to expand, train, and manage our sales and distribution base. There is no guarantee that we will be able to effectively manage our existing operations or the growth of our operations, or that our facilities, systems, procedures, or controls will be adequate to support any future growth. Our ability to manage our operations and any future growth will have a material effect on our stockholders.
If we fail to remain current on our reporting requirements, we could be removed from the OTC Bulletin BoardMarkets, 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,Markets, such as us, must be reporting issuers under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and must be current in their reports under Section 13, in order to maintain price quotation privileges on the OTC Bulletin Board.Markets. If we fail to remain current on our reporting requirements, we could be removed from the OTC Bulletin Board.Markets. 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 are not required to provide the information required by this Item.
The financial statements begin on Page F-1.
None.
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that material information required to be disclosed in our periodic reports filed under the Securities Exchange Act of 1934, as amended, or 1934 Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and to ensure that such information is accumulated and communicated to our management, including our chief executive officer and acting chief financial officer as appropriate, to allow timely decisions regarding required disclosure. We carried out an evaluation, under the supervision and with the participation of our management, including the principal executive officer and the principal financial officer (principal financial officer), of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 13(a)-15(e) under the 1934Exchange Act, as of the end of the period covered by this report. Based on this evaluation, because of the Company’sour limited resources and limited number of employees, management concluded that our disclosure controls and procedures were ineffective as of March 31, 2018.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting. The Company’sOur internal control over financial reporting is designed to provide reasonable assurances regarding the reliability of financial reporting and the preparation of theour financial statements of the Company in accordance with U.S. generally accepted accounting principles, or GAAP. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree or compliance with the policies or procedures may deteriorate.
With the participation of our Chief Executive Officer and Acting Chief Financial Officer (principal financial officer), our management conducted an evaluation of the effectiveness of our internal control over financial reporting as of March 31, 20182019 based on the framework in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"(“COSO”). Based on our evaluation and the material weaknesses described below, management concluded that the Companywe did not maintain effective internal control over financial reporting as of March 31, 20182019, based on the COSO framework criteria. Management has identified the following material weaknesses in internal control over financial reporting: 1) The Company lacks(1) We lack controls to ensure theywe are adequately capturing theirour liabilities at each reporting date. 2) The Company does(2) We do not have the appropriate processes or controls in place to efficiently or timely match transactions within theirour accounting system to theirour back-end operating system. 3) The Company lacks(3) We lack the processes and controls necessary to timely reconcile theirour accounts and to adequately analyze complex disclosure and presentation issues. Management of the CompanyOur management believes that these material weaknesses have been due to the small size of the Company’sour accounting staff and reliance on outside consultants for external reporting.
In light of the above-mentioned material weaknesses, we performed additional analyses and procedures in order to conclude that our consolidated financial statements for the year ended March 31, 20182019, included in this Annual Report on Form 10-K were fairly stated in accordance with US GAAP.
Management’s report does not include an attestation report of our registered public accounting firm regardingon internal control over financial reporting. Management’s reportreporting was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission rules that permit us to provide only management’s report in this Annual Report on Form 10-K.
Limitations on Effectiveness of Controls and Procedures
Our management, including our Chief Executive Officer and Acting Chief Financial Officer (principal financial officer), does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Companycompany have been detected. These inherent limitations include, but are not limited to, the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
Changes in Internal Controls
During the fiscal quarter ended March 31, 2018,2019, there have been no changes in our internal control over financial reporting that have materially affected or are reasonably likely to materially affect our internal controls over financial reporting.
Item 9B. OTHER INFORMATIONOther Information
None.
| 20 |
Directors and Executive Officers
The following table sets forth certain information with respect to our directors and executive officers during the 2018 Fiscal Year.
Name | Age | Position | ||
| Ryan Smith | Chief Executive Officer and Director | |||
| Annette Raynor | Chief Operating Officer and Director | |||
| Chad Miller | Director | |||
| William C. Kosoff | Acting Chief Financial Officer | |||
Ryan Smith. Mr. Smith has served as director and Chief Executivechief executive officer since March 31, 2017. Since 2013, Mr. Smith has served as the Chief Executive Officerchief executive officer of Kuvera, LLC, formerly Wealth Generators, LLC.LLC, our wholly owned subsidiary. Mr. Smith received his BS from Brigham YoungThe University of Utah in 2003.
Annette Raynor. Ms. Raynor has served as the Company’s Chief Operating Officerour chief operating officer since March 31, 2017, and as a director since June 6, 2017. Since 2013, Ms. Raynor has served as the Chief Operating Officerchief operating officer of Kuvera, LLC, formerly Wealth Generators, LLC, the Company’sour wholly owned subsidiary. Ms. Raynor holds her Series 65 Registered Investment Advisor license, Series 3 Commodity Futures, Series 34 Retail Off-Exchange Forex, and is a licensed realtor in the Statestate of New Jersey. Ms. Raynor is the general manager and licensed representative of SAFE Management LLC.
Chad Miller. Mr. Miller was appointed as a director on June 6, 2017. Mr. Miller co-founded Kuvera, LLC, formerly Wealth Generators, LLC, our wholly owned subsidiary, in 2013. Prior to 2013, Mr. Miller held his Series 63 – Uniform Securities License, Series 7 General Securities License, and Series 24 General Securities Principal License and was employed by various brokerage firms from 1999 through 2010.
William C. Kosoff – Chief Financial Officer and Director. FromKosoff.Since September 2006, Mr. Kosoff has been a Director of the Company, and served in various positions, including Chief Financial Officer, Secretary,chief financial officer, secretary, and Treasurer during the past seven years.treasurer. He had a break in service as an officer and employee from December 2012 to April 2013, when he returned and currently servesbegan serving again as Acting Chief Financial Officer.acting chief financial officer. He was also formerly a director. He has worked in the high technology industry for 45 years, serving in Engineering, Marketing, Sales,engineering, marketing, sales, and Senior Managementsenior management positions with Rockwell International from 1960 to 1984. In 1984, he co-founded Telenetics Corp and served as Presidentits president and Chief Executive Officer.chief executive officer. In 1987, Telenetics became public through an IPO on NASDAQ and was acquired in 2006 by a private firm. Mr. Kosoff received his Bachelor of Arts in Physics from California State University in 1978 and earned a Professional Certificate in Accounting from New York University in 2010.
Our directors are elected for a term of one year and/orand until their successors qualified, nominated, and elected.
Role of the Board
It is the paramount duty of the Boardboard to oversee the Company’s Chief Executive Officer (the “CEO”) and other seniorour management in the competent and ethical operation of the Companycompany on a day-to-day basis and to assure that the long-term interests of the shareholders are being served. To satisfy this duty, the directors take a proactive, focused approach to their position, and set standards to ensure that the Company iswe are committed to business success through maintenance of ambitious standards of responsibility and ethics.
The Boardboard of directors met formally a total of two timestwice during fiscal 2018.
Committees
Our business, property, and affairs are managed by or under the direction of the board of directors. Members of the board are kept informed of our business through discussion with the chief executive and financial officers and other officers, by reviewing materials provided to them, and by participating at meetings of the board and its committees.
Audit Committee
We currently doesdo not have a designated Audit Committee,audit committee, and accordingly, the Company's Boardour board of Directors' policy is to pre-approvedirectors preapproves all audit and permissible non-audit services provided by the independent auditors. These services may includeauditor, including audit, services, audit-related, services, tax, services and other services. Pre-approvalPreapproval is generally provided for up to one year, and any pre-approval is detailed as to the particular service or category of services, and is generally subject to a specific budget. The independent auditorsauditor and management are required to periodically report to the Company's Boardour board of Directorsdirectors regarding the extent of services provided by the independent auditorsauditor in accordance with this pre-approval,preapproval and the fees for the services performed to date. The Boardboard of Directorsdirectors may also pre-approvepreapprove particular services on a case-by-case basis.
Compensation Committee
We currently doesdo not have a designated Compensation Committee,compensation committee, and accordingly, the Company's Boardour board of Directors'directors will approve all compensation matters until such committee is established and approved.
Code of Ethics
We have a code of ethics that applies to all of the Company’sour employees, including itsour principal executive officer, principal financial officer, and principal accounting officer, and the Board. Adirectors, a copy of this codewhich is available in the Employee Handbook. The Company intendsWe intend to disclose any changes in or waivers from itsour code of ethics by posting such information on itsour website or by filing a Form 8-K.
Section 16(a) Compliance
Section 16(a) of the Securities Exchange Act of 1934, requires our directors, executive officers, and persons who own more than 10% of our common stock to file with the SECSecurities and Exchange Commission initial reports of ownership and reports of changes in ownership of common stock and other of our equity securities. During the year ended March 31, 2018,2019, our officers, directors, and 10% stockholders made the required filings pursuant to Section 16(a).
Directors’ Compensation
There was no Compensationcompensation for the three Directorsfour directors, acting in their capacity as directors, during the year ending March 31, 2018.
Executive Officers’ Compensation
The following table sets forth information concerning the annual and long-term compensation earned by or paid to our Chief Executive Officerchief executive officer and to other persons who served as executive officers as, at, and/or during the fiscal year ended March 31, 20182019, or who earned compensation exceeding $100,000 during fiscal year 20182019 (the “named executive officers”), for services as executive officers for the last two fiscal years.
Summary Compensation Table
| Name and Principal Position | Fiscal Year |
Salary |
Stock Awards |
Option Awards |
Non-Equity Incentive Plan Compensation | Change in Pension Value and Non Qualified Deferred Compensation Earnings |
All Other Compensation |
Total | ||||||||||||||||||||||||
| ($) | ($) | ($) | ($) | ($) | ($) | ($) | ||||||||||||||||||||||||||
| Ryan Smith [1] | 2019 | 225,000 | - | - | - | - | 293,242 | [2] | 518,242 | |||||||||||||||||||||||
| CEO and Director | 2018 | 207,500 | - | - | - | - | 131,685 | [3] | 339,185 | |||||||||||||||||||||||
| Annette Raynor [4] | 2019 | 225,000 | - | - | - | - | 297,442 | [5] | 522,442 | |||||||||||||||||||||||
| COO and Director | 2018 | 207,500 | - | - | - | - | 135,885 | [6] | 343,385 | |||||||||||||||||||||||
| Chad Miller [7] | 2019 | 225,000 | - | - | - | - | 293,242 | [8] | 518,242 | |||||||||||||||||||||||
| Director | 2018 | 207,500 | - | - | - | - | 131,685 | [9] | 339,185 | |||||||||||||||||||||||
| Mario Romano [10] | 2019 | 225,000 | - | - | - | - | 297,442 | [11] | 522,442 | |||||||||||||||||||||||
| Director of Finance | 2018 | 207,500 | - | - | - | - | 135,885 | [12] | 343,385 | |||||||||||||||||||||||
| William C. Kosoff | 2019 | 60,000 | - | - | - | - | - | 60,000 | ||||||||||||||||||||||||
| Acting CFO | 2018 | 52,000 | - | - | - | - | - | 52,000 | ||||||||||||||||||||||||
| Name and Principal Position | Fiscal Year | Salary | Stock Awards | Option Awards | Non-Equity Incentive Plan Compensation | Change in Pension Value and Non Qualified Deferred Compensation Earnings | All Other Compensation | |
($) | ($) | ($) | ($) | ($) | ($) | ($) | ||
| Dr. Joseph J. Louro | 2017 | 150,000 [1] | - | - | - | - | 150,000 | |
| Former CEO and | 2018 | - [1] | - | - | - | - | - | |
| Chairman | ||||||||
| William C. Kosoff | 2017 | 95,704 [2] | - | - | - | 27,500 | - | 127,250 |
| Acting CFO | 2018 | 52,000 [2] | - | - | - | - | - | 52,000 |
| Ryan Smith | 2017 | 80,000 [3] | - | - | - | 115,000 | - | 195,000 |
| CEO & Founder | 2018 | 217,500 [3] | - | - | - | - | 111,935 [3] | 329,435 |
| Annette Raynor | 2017 | 80,000 [4] | - | - | - | 115,000 | - | 195,000 |
| COO & Founder | 2018 | 207,500 [4] | - | - | - | - | 103,935 [4] | 311,435 |
| Chad Miller | 2017 | 40,000 [5] | - | - | - | 155,000 | - | 195,000 |
| Director & Founder | 2018 | 217,500 [5] | - | - | - | - | 106,935 [5] | 324,435 |
| Mario Romano | 2017 | 80,000 [6] | - | - | - | 115,000 | - | 195,000 |
| Director of Finance & Founder | 2018 | 207,500 [6] | - | - | - | - | 103,935 [6] | 311,435 |
| [1] | A portion of Mr. Smith’s compensation was paid to Kays Creek Capital, an entity in which he is an owner. |
| [2] | Includes $30,000 in medical reimbursements, $69,512 for fiscal year 2019 revenue under the Founder Revenue Agreements discussed below, and $193,730 that was accrued but unpaid under the Founder Revenue Agreements. |
| [3] | Includes $30,000 in medical reimbursements, $70,710 for fiscal year 2018 revenue under the Founder Revenue Agreements discussed below, and $30,975 that was accrued but unpaid under the Founder Revenue Agreements. |
| [4] | A portion of Ms. Raynor’s compensation was paid to Wealth Engineering LLC, an entity in which she is a 50% owner. |
| [5] | Includes $34,200 in medical reimbursements, $108,512 for fiscal year 2019 revenue under the Founder Revenue Agreements discussed below, and $154,730 that was accrued but unpaid under the Founder Revenue Agreements. |
| [6] | Includes $34,200 in medical reimbursements, $75,210 for fiscal year 2018 revenue under the Founder Revenue Agreements discussed below, and $26,475 that was accrued but unpaid under the Founder Revenue Agreements. |
| [7] | A portion of Mr. Miller’s compensation was paid to Kays Creek Capital and MILCO, entities in which he is an owner. |
| [8] | Includes $30,000 in medical reimbursements, $69,512 for fiscal year 2019 revenue under the Founder Revenue Agreements discussed below, and $193,730 that was accrued but unpaid under the Founder Revenue Agreements. |
| [9] | Includes $30,000 in medical reimbursements, $70,710 for fiscal year 2018 revenue under the Founder Revenue Agreements discussed below, and $30,975 that was accrued but unpaid under the Founder Revenue Agreements. |
| [10] | A portion of Mr. Romano’s compensation was paid to Wealth Engineering LLC, an entity in which he is a 50% owner. |
| [11] | Includes $34,200 in medical reimbursements, $108,512 for fiscal year 2019 revenue under the Founder Revenue Agreements discussed below, and $154,730 that was accrued but unpaid under the Founder Revenue Agreements. |
| [12] | Includes $34,200 in medical reimbursements, $75,210 for fiscal year 2018 revenue under the Founder Revenue Agreements discussed below, and $26,475 that was accrued but unpaid under the Founder Revenue Agreements. |
Dr. Louro did not receiveOutstanding Equity Awards at Fiscal Year-End
No stock option awards were exercisable or unexercisable as of March 31, 2019, for any cashexecutive officer.
Employee Stock Options
The nonqualified plan adopted in 2007 authorizes 65,000 shares, of which 47,500 have been granted as of March 31, 2019. The qualified plan adopted in October of 2008 authorizes 125,000 shares and was approved by a majority of our shareholders on September 16, 2009. As of March 31, 2019, 42,500 shares have been granted under the 2008 plan.
The following table summarizes the changes in employee stock options outstanding and the related prices for the shares of our common stock issued to employees under two employee stock option plans:
| Weighted | ||||||||||||||||
| Weighted | Average | |||||||||||||||
| Average | Remaining | Aggregate | ||||||||||||||
| Number of | Exercise | Contractual | Intrinsic | |||||||||||||
| Shares | Price | Life (years) | Value | |||||||||||||
| Options outstanding at March 31, 2017 | 35,000 | $ | 10.00 | 2.51 | $ | - | ||||||||||
| Granted | - | $ | - | |||||||||||||
| Exercised | - | $ | - | |||||||||||||
| Canceled / expired | - | $ | - | |||||||||||||
| Options outstanding at March 31, 2018 | 35,000 | $ | 10.00 | 1.51 | $ | - | ||||||||||
| Granted | - | $ | - | |||||||||||||
| Exercised | - | $ | - | |||||||||||||
| Canceled / expired | - | $ | - | |||||||||||||
| Options outstanding at March 31, 2019 | 35,000 | $ | 10.00 | 0.51 | $ | - | ||||||||||
| Options exercisable at March 31, 2019 | 35,000 | $ | 10.00 | 0.51 | $ | - | ||||||||||
Stock-based compensation duringexpense in connection with options granted to employees for the year ended March 31, 20172019 and settled his accrued $150,000 for 3,000,000 shares of Investview’s restricted common stock. On April 6, 2017, Dr. Joseph Louro voluntarily resigned as Chairman and CEO and received no compensation during the year ended March 31, 2018.
Employment Agreements and Revenue Share Agreements
The four Founders,founders of Wealth Generators, LLC, Ryan Smith, Chief Executive Officer;chief executive officer; Chad Miller, Chief Visionary Officer;chief visionary officer; Annette Raynor, Chief Operating Officer;chief operating officer; and Mario Romano, Directordirector of Financefinance and Investor Relationsinvestor relations, all entered into “FOUNDER EMPLOYMENT AGREEMENTS”Founder Employment Agreements effective October 1, 2017.
On October 11, 2017, by and among INVESTVIEW INC. a Nevada corporation (the “Company”), andwe entered into Founder’s Revenue Agreements with Chad Miller, Annette Raynor, Mario Romano, and Ryan Smith (each a “Founder,” and together the “Founders”).
As of April 3, 2017, upon the reverse acquisition of Wealth Generators LLC, Mr. Kosoff was appointed as the Acting Chief Financial Officeracting chief financial officer and resumed payroll as an employee at a mutually agreed reduced rate. In the event the employeehe resigns without good reason with 90 daysdays’ written notice or is terminated for cause (willful misconduct) with 30 daysdays’ written notice, the employeehe is entitled to all accrued and unpaid compensation as of the date of such termination and expense reimbursement.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS, MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The following table providessets forth certain information, as to shares of June 29, 2019, respecting the beneficial ownership of our outstanding common stock beneficially ownedby: (i) any holder of more than 5%; (ii) each of the Named Executive Officers and directors; and (iii) our directors and Named Executive Officers as of May 31, 2018 by:
| Name of Beneficial Owner [1] | Common Stock Beneficially Owned | Percentage of Common Stock [2] |
| Chad Miller, Chairman [1], [3] | 631,874,710 | 29.12% |
| Ryan Smith, CEO and Director [1], [3] | 631,874,710 | 29.12% |
| Annette Raynor, COO and Director [1], [4] | 215,356,942 | 9.93% |
| Mario Romano, Co-Founder and Treasurer | 215,356,942 | 9.93% |
| William C. Kosoff, Acting CFO [1] | 3,970,680 | <1% |
| CR Capital Holdings LLC [3] | 631,874,710 | 29.12% |
| Wealth Engineering LLC [4] | 110,356,942 | 5.09% |
| Wealth Colony LLC [5] | 101,900,708 | 4.69% |
| All Officers and Directors as a group (4 Persons) | 851,211,332 | 39.23% |
| Name of Beneficial Owner(1) | Common Stock Beneficially Owned | Percentage of Common Stock(2) | ||||||
| Principal Stockholders: | ||||||||
| CR Capital Holdings LLC(3) | 621,874,710 | 23.2 | % | |||||
| Directors and Officers: | ||||||||
| Chad Miller, Chairman(3) | 621,874,710 | 23.2 | % | |||||
| Ryan Smith, CEO and Director(3) | 621,874,710 | 23.2 | % | |||||
| Annette Raynor, COO and Director(4)(5) | 215,456,942 | 8 | % | |||||
| Mario Romano, Treasurer(4)(6) | 215,456,942 | 8 | % | |||||
| William C. Kosoff, Acting CFO | 3,936,875 | * | ||||||
All Officers and Directors as a group (5 persons)(3)(4)(5)(6) | 946,268,527 | 35.3 | % | |||||
| * | Less than 1%. |
| (1) | Except as otherwise indicated, the address of each beneficial owner is c/o InvestView Inc., 12 South 400 West, Salt Lake City, UT 84101. |
| (2) | Applicable percentage ownership is based on 2,679,376,966 shares of common stock outstanding as of June 29, 2019, together with securities exercisable or convertible into shares of common stock within 60 days of that date, for each stockholder. |
| (3) | Our directors Ryan Smith and Chad Miller each own 50% of CR Capital Holdings LLC and, as a result, have voting and dispositive control of these shares. Therefore, they are deemed to be the beneficial owners of our shares of common stock. |
| (4) | The members of Wealth Engineering LLC, 745 Hope Road, Eatontown, NJ 07724, own 110,456,942 shares of our common stock. Our officers Mario Romano and Annette Raynor are two of its members. In addition, Mr. Romano is the CEO and Ms. Raynor serves as the COO of Wealth Engineering LLC. Combined Mr. Romano and Ms. Raynor have voting and shared dispositive control of these shares. |
| (5) | In addition to the 110,456,942 shares owned by Wealth Engineering LLC, Ms. Raynor owns 105,000,000 shares personally. |
| (6) | In addition to the 110,456,942 shares owned by Wealth Engineering LLC, Mr. Romano owns 105,000,000 shares personally. |
No Director,director, executive officer, affiliate, or any owner of record or beneficial owner of more than 5% of any class of our voting securities of the Company is a party adverse to the Companyus or has a material interest adverse to us.
Equity Compensation Plans
The following table summarizes the Company.
| Number of Securities | ||||||||||||
| Number of | Remaining Available | |||||||||||
| Securities To Be | Weighted-Average | for Future Issuance under | ||||||||||
| Issued upon Exercise of | Exercise Price of | Equity Compensation Plans | ||||||||||
| Outstanding Options, | Outstanding Options, | (excluding securities | ||||||||||
| Warrants and Rights | Warrants and Rights | reflected in column (a)) | ||||||||||
| Plan Category | (a) | (b) | (c) | |||||||||
| Equity compensation plans approved by security holders | — | — | — | |||||||||
| Equity compensation plans approved by security holders | 35,000 | $ | 10 | — | ||||||||
Our related party payables consisted of the following:
Year Ended March 31, | ||
2018 | 2017 | |
| Short term advances [1] | $1,880 | $100,000 |
| Revenue-based funding agreement entered into on 11/8/15 [2] | - | 180,000 |
| Short-term promissory note entered into on 9/13/16 [3] | - | 150,000 |
| Promissory note entered into on 11/15/16 [4] | - | 895 |
Promissory note entered into on 3/15/17 [5] | - | 375,000 |
$1,880 | $805,895 | |
| Year Ended March 31, | ||||||||
| 2019 | 2018 | |||||||
| Short-term advances [1] | $ | 440,489 | $ | 1,880 | ||||
| Short-term promissory note entered into on 8/17/18 [2] | 105,000 | - | ||||||
| $ | 545,489 | $ | 1,880 | |||||
| [1] | We periodically receive advances for operating funds from our current majority shareholders (former members of Wealth Generators prior to the reverse acquisition) and other related parties, including entities that are owned, controlled, or influenced by our owners or management. These advances are due on demand, generally have no set interest rates associated with them, and are unsecured. During the year ended March 31, 2019, we received $1,805,777 in cash proceeds from advances, incurred $15,000 in interest, and repaid related parties a total of $1,382,168. | |
| [2] | A member of the senior management team advanced funds of $100,000 on August 17, 2018, under a short-term promissory note due to be repaid on August 31, 2018. On August 31, 2018 the note was amended to be due on demand or, in absence of a demand, due on August 31, 2019. The note had a fixed interest payment of $5,000, which was recorded as interest expense in the statement of operations during the year ended March 31, 2019. |
In addition to the reverse acquisition) and otherabove-mentioned related parties, including entities that are owned, controlled, or influenced by our owners or management. These advances are due on demand, generally have no set interest rates associated with them, and are unsecured. During the year ended March 31, 2018, we received $498,380 in cash proceeds from advances,
The following is a summary of the fees billed to the Companyus for professional services rendered for the fiscal years ended March 31, 20182019 and 2017.
March 31, 2018 | March 31, 2017 | |
| Audit Fees | $153,000 | $57,500 |
| Audit Related Fees | 7,800 | - |
| Tax Fees | 3,000 | - |
| All Other Fees | - | - |
| Total | $163,800 | $57,500 |
| March 31, 2019 | March 31, 2018 | |||||||
| Audit Fees | $ | 115,400 | $ | 153,000 | ||||
| Audit Related Fees | 15,500 | 7,800 | ||||||
| Tax Fees | 4,000 | 3,000 | ||||||
| All Other Fees | - | - | ||||||
| Total | $ | 134,900 | $ | 163,800 | ||||
AUDIT FEES.Audit Fees. Consists of fees billed for professional services rendered for the audit of Investview, Inc.'sour consolidated financial statements and review of the interim consolidated financial statements included in quarterly reports and services in connection with statutory and regulatory filings or engagements.
AUDIT-RELATED FEES.Audit-Related Fees. Consists of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of Investview, Inc.’sour consolidated financial statements and are not reported under "Audit“Audit Fees."”
TAX FEES.Tax Fees. Consists of fees billed for professional services for tax compliance, tax advice, and tax planning.
ALL OTHER FEES.All Other Fees. Consists of fees for products and services other than the services reported above. There were no management consulting services provided in fiscal 2016 or 2017.
Policy on Audit Committee Preapproval of Audit and Permissible Non-Audit Services of Independent Auditors
We do not have a designated Audit Committee, and accordingly, the Company's Boardour board of Directors'directors’ policy is to pre-approvepreapprove all audit and permissible non-audit services provided by the independent auditors. These services may include audit services, audit-related services, tax services, and other services. Pre-approvalPreapproval is generally provided for up to one year and any 8 pre-approvalpreapproval is detailed as to the particular service or category of services and is generally subject to a specific budget. The independent auditors and management are required to periodically report to the Company's BoardCompany’s board of Directorsdirectors regarding the extent of services provided by the independent auditors in accordance with this pre-approval, and the fees for the services performed to date. The Boardboard of Directorsdirectors may also pre-approvepreapprove particular services on a case-by-case basis.
| Exhibit Number* | Title of Document | Location | ||
| Item 2 | Plan of Acquisition, Reorganization, Arrangement, Liquidation or Succession | |||
| Contribution Agreement between Investview, Inc., Wealth Generators, LLC, and the members of Wealth Generators, LLC dated March 31, 2017 | Incorporated by reference to the Current Report on Form 8-K filed April 6, 2017 | |||
| Item 3 | Articles of Incorporation and Bylaws | |||
| 3.01 | Articles of Incorporation | Incorporated by reference to the Form 10SB12G filed August 12, 1999 | ||
| 3.02 | Articles of Amendments to the Articles of Incorporation | Incorporated by reference to the Form 10SB12G filed August 12, 1999 | ||
| 3.03 | Bylaws | Incorporated by reference to the Form 10SB12G filed August 12, 1999 | ||
| 3.04 | Amendment to Articles of Incorporation or by-laws | Incorporated by reference to the Current Report on Form 8-K filed February 15, 2007 | ||
| 3.05 | Certificate of Change filed pursuant to NRS 78.209 | Incorporated by reference to the Current Report on Form 8-K filed April 6, 2012 | ||
| 3.06 | Articles of Merger filed pursuant to NRS 92.A.200 | Incorporated by reference to the Current Report on Form 8-K filed April 6, 2012 | ||
| 3.07 | Certificate of Amendment to Articles of Incorporation | Incorporated by reference to the Definitive Information Statement filed December 20, 2017 | ||
| Item 4 | Instruments Defining the Rights of Security Holders, including indentures | |||
| Common Stock Specimen | Incorporated by reference to the Registration Statement on Form S-1 filed January 12, | |||
| Item 10 | Material Contracts | |||
| 10.01 | Form of Common Stock Purchase Warrant dated July 7, 2011 | Incorporated by reference to the Current Report on Form 8-K filed July 13, 2011 | ||
| 10.02 | Form of Common Stock Purchase Warrant – August 2012 | Incorporated by reference to the Current Report on Form 8-K filed August 20, 2012 | ||
| 10.03 | 2012 Incentive Stock Plan** | Incorporated by reference to the Registration Statement on Form S-8 filed July 25, 2012 | ||
| 10.04 | Form of Common Stock Purchase Warrant issued to Allied Global Ventures LLC | Incorporated by reference to the Current Report on Form 8-K filed October 8, 2013 | ||
| 10.05 | Form of Common Stock Purchase Warrant | Incorporated by reference to the Current Report on Form 8-K filed June 11, 2014 | ||
| 10.06 | Form of Common Stock Purchase Warrant – September 30, 2014 | Incorporated by reference to the Current Report on Form 8-K filed October 7, 2014 |
Title of Document | Location | |||
| 10.22 | ||||
| Form of Conversion Agreement dated June 6, 2017 | Incorporated by reference to the Current Report on Form 8-K filed June 12, 2017 | |||
| 10.23 | Agreement entered into with CTB Rise International Inc. dated June 7, 2017 | Incorporated by reference to the Current Report on Form 8-K filed June 12, 2017 | ||
| 10.24 | Founder Employment Agreement between | Incorporated by reference to the Current Report on Form 8-K filed October 13, 2017 | ||
| 10.25 | Founder Employment Agreement between | Incorporated by reference to the Current Report on Form 8-K filed October 13, 2017 | ||
| 10.26 | Founder Employment Agreement between | Incorporated by reference to the Current Report on Form 8-K filed October 13, 2017 | ||
| 10.27 | Founder Employment Agreement between | Incorporated by reference to the Current Report on Form 8-K filed October 13, 2017 | ||
| 10.28 | Founder Revenue Agreement among | Incorporated by reference to the Current Report on Form 8-K filed October 13, 2017 | ||
| 10.29 | Contribution and Exchange Agreement between | Incorporated by reference to the Current Report on Form 8-K filed October 27, 2017 | ||
| 10.30 | Product Contribution Agreement between | Incorporated by reference to the Current Report on Form 8-K filed November 15, 2017 | ||
| 10.31 | Exclusive License Agreement between | Incorporated by reference to the Current Report on Form 8-K filed November 15, 2017 | ||
| 10.32 | Product Contribution Agreement between | Incorporated by reference to the Current Report on Form 8-K filed November 15, 2017 |
| 10.33 | Securities Purchase Agreement between InvestView, Inc., and D-Beta One EQ, Ltd., entered December 6, 2017 | Incorporated by reference to the Current Report on Form 8-K filed December 13, 2017 | ||
| 10.34 | Registration Rights Agreement between InvestView, Inc., and D-Beta One EQ, Ltd., entered December 6, 2017 | Incorporated by reference to the Current Report on Form 8-K filed December 13, 2017 | ||
| 10.35 | Standby Equity Distribution Agreement between InvestView, Inc., and YAII PN, Ltd., entered December 6, 2017 | Incorporated by reference to the Current Report on Form 8-K filed December 13, 2017 | ||
| 10.36 | Incorporated by reference from Current Report on Form 8-K filed July 25, 2018 | |||
| 10.37 | Product Contribution Agreement between Investview, Inc. and WestMyn Technology Services, Inc., entered May 1, 2018 | Incorporated by reference from the Quarterly Report on Form 10-Q/A for the quarter ended June 30, 2018, filed September 5, 2018 |
| Exhibit Number* | Title of | Location | ||
| 10.38 | Capital Crypto Mining Agreement between Investview, Inc. and WestMyn Technology Services, Inc., entered May 1, 2018 | Incorporated by reference from the Quarterly Report on Form 10-Q for the quarter ended June 30, 2018, filed September 5, 2018 | ||
| 10.39 | Master Services Agreement between Investview, Inc., its assigns, and BYOBitcoin LLC | Incorporated by reference from Current Report on Form 8-K filed September 25, 2018 | ||
| 10.41 | Stock Buyback Letter Agreement between Investview, Inc. and Yorkville Advisors Global, LP and its subsidiaries dated September 13, 2018 | Incorporated by reference from Current Report on Form 8-K filed September 26, 2018 | ||
| 10.42 | Common Stock Purchase Agreement between Investview, Inc. and TRITON FUNDS, LP., entered December 29, 2018 | Incorporated by reference to the | ||
| 10.43 | Registration Rights Agreement between Investview, Inc. and TRITON FUNDS, LP., entered December 29, 2018 | Incorporated by reference to the Current Report on Form 8-K filed January 7, 2019 | ||
| 10.44 | Share Donation Agreement between Investview, Inc. and TRITON FUNDS, LP, Ltd., entered December 29, 2018 | Incorporated by reference to the Current Report on Form 8-K filed January 7, 2019 | ||
| 10.45 | Joint Venture Agreement among Investview, Inc. and AI Data Consulting, LLC, and Freedom Enterprise, LLC | Incorporated by reference to | ||
| 10.46 | Amended Common Stock Purchase Agreement between Investview, Inc. and TRITON FUNDS LP entered March 22, 2019 | Incorporated by reference to the Current Report on Form 8-K filed March | ||
| 10.47 | ||||
| 10.48 | Incorporated by reference to the Current Report on Form | |||
| Item 21 | Subsidiaries of the Registrant | |||
| 21.01 | Schedule of Subsidiaries | Incorporated by reference to Amendment No. 2 to the Registration Statement on Form S-1/A filed March 11, 2019 | ||
| Item 23 | Consents of Experts and Counsel | |||
| 23.01 | Consent of Haynie & Company | This filing. | ||
| Item 31 | Rule 13a014(a)/15d-14(a) Certifications | |||
| 31.01 | Rule 13a-14a Certification of Principal Executive Officer | This filing. | ||
| 31.02 | Rule 13a-14a Certification of Principal Financial Officer | This filing. | ||
| Item 32 | Section 1350 Certifications | |||
| 32.01 | Section 1350 Certification of the Principal Executive Officer | This filing. | ||
| 32.02 | Section 1350 Certification of the Principal Financial Officer | This filing. |
| Exhibit Number* | Title of Document | Location | ||
| Item 101 | Interactive Data Files*** | |||
| 101.INS | XBRL Instance Document | This | ||
| 101.SCH | XBRL Taxonomy Extension Schema | This | ||
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase | This | ||
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase | This | ||
| 101.LAB | XBRL Taxonomy Extension Label Linkbase | This | ||
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase | This |
| * | All exhibits are numbered with the number preceding the decimal indicating the applicable SEC reference number in Item 601 and the number following the decimal indicating the sequence of the particular document. Omitted numbers in the sequence refer to documents previously filed as an exhibit. |
| ** | Identifies each management contract or compensatory plan or arrangement required to be filed as an exhibit, as required by Item 15(a)(3) of Form 10-K. |
| *** | Users of this data are advised that, pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of this annual report for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Exchange Act and otherwise are not subject to liability. |
Item 16. Form 10-K Summary
Not included.
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Investview Inc. | ||
| Dated: | By: | /s/ Ryan Smith |
| Ryan Smith | ||
| Chief Executive Officer | ||
| (Principal Executive Officer) | ||
| Dated: | By: | /s/ William C. Kosoff |
| William C. Kosoff | ||
| Acting Chief Financial Officer | ||
| (Principal Financial and Accounting 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.
| SIGNATURE | TITLE | DATE | ||
| /s/ Ryan Smith | Chief Executive Officer and Director | |||
| Ryan Smith | (Principal Executive Officer) | |||
| /s/ Chad Miller | Director | |||
| Chad Miller | ||||
| /s/ Annette Raynor | Chief Operating Officer and Director | |||
| Annette Raynor |
MARCH 31, 20182019 AND 2017
FORMING A PART OF ANNUAL REPORT
PURSUANT TO THE SECURITIES EXCHANGE ACT OF 1934
INVESTVIEW, INC.
Index to Consolidated Financial Statements
To the Board of Directors and
Stockholders of Investview, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Investview, Inc. (the Company) as of March 31, 20182019, and 2017,2018, and the related consolidated statements of operations, stockholders’ deficit,equity, and cash flows for each of the years in the two-year period ended March 31, 2018,2019, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 20182019, and 2017,2018, and the results of its operations and its cash flows for each of the years in the two-year period ended March 31, 2018,2019, in conformity with accounting principles generally accepted in the United States of America.
Consideration of the Company’s Ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 4 to the financial statements, the Company has suffered losses from operations and its current cash flow is not enough to meet current needs. This raises substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regards to this matter are also described in Note 4. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, 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.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/ Haynie & Company
Salt Lake City, Utah
June 29, 2018
CONSOLIDATED BALANCE SHEETS
March 31, | March 31, | |
2018 | 2017 | |
| ASSETS | ||
| Current assets: | ||
| Cash and cash equivalents | $1,490,686 | $1,616 |
| Prepaid assets | 3,555 | - |
| Receivables | 472,557 | 444,610 |
| Short term advances | 10,000 | 10,000 |
| Short term advances - related party | 36,510 | - |
| Other current assets | 480,370 | - |
| Total current assets | 2,493,678 | 456,226 |
| Fixed assets, net | 18,860 | 10,235 |
| Other assets: | ||
| Long term license agreement, net | 2,133,620 | - |
| Deposits | 4,500 | 6,000 |
| Total other assets | 2,138,120 | 6,000 |
| Total assets | $4,650,658 | $472,461 |
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||
| Current liabilities: | ||
| Accounts payable and accrued liabilities | $5,352,073 | $1,370,972 |
| Deferred revenue | 863,740 | 433,298 |
| Related party payables | 1,880 | 805,895 |
| Debt, current portion | 195,245 | 2,093,745 |
| Total current liabilities | 6,412,938 | 4,703,910 |
| Total liabilities | 6,412,938 | 4,703,910 |
| Commitments and contingencies | - | - |
| STOCKHOLDERS' EQUITY (DEFICIT) | ||
| Preferred stock, par value: $0.001; 10,000,000 shares authorized, none issued and outstanding as of March 31, 2018 and 2017 | - | - |
| Common stock, par value $0.001; 10,000,000,000 shares authorized; 2,169,661,318 and 125,889,455 issued and 2,169,661,318 and 125,888,155 outstanding as of March 31, 2018 and 2017, respectively | 2,169,661 | 125,890 |
| Additional paid in capital | 16,137,945 | 805,637 |
| Treasury stock, 0 and 1,300 shares outstanding as of March 31, 2018 and 2017, respectively | - | (8,589) |
| Accumulated other comprehensive income | (2,483) | - |
| Accumulated deficit | (20,067,403) | (5,154,387) |
| Total stockholders' equity (deficit) | (1,762,280) | (4,231,449) |
| Total liabilities and stockholders' equity (deficit) | $4,650,658 | $472,461 |
| March 31, | March 31, | |||||||
| 2019 | 2018 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 133,644 | $ | 1,490,686 | ||||
| Prepaid assets | 6,685,970 | 3,555 | ||||||
| Receivables | 724,995 | 472,557 | ||||||
| Short-term advances | 10,000 | 10,000 | ||||||
| Short-term advances - related party | 500 | 36,510 | ||||||
| Other current assets | 142,061 | 480,370 | ||||||
| Total current assets | 7,697,170 | 2,493,678 | ||||||
| Fixed assets, net | 13,528 | 18,860 | ||||||
| Other assets: | ||||||||
| Intangible assets, net | 1,576,685 | - | ||||||
| Long term license agreement, net | 1,983,220 | 2,133,620 | ||||||
| Deposits | 4,500 | 4,500 | ||||||
| Total other assets | 3,564,405 | 2,138,120 | ||||||
| Total assets | $ | 11,275,103 | $ | 4,650,658 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | 3,897,013 | $ | 5,352,073 | ||||
| Customer advance | 265,000 | - | ||||||
| Deferred revenue | 1,876,727 | 863,740 | ||||||
| Derivative liability | 1,358,901 | - | ||||||
| Related party payables | 545,489 | 1,880 | ||||||
| Debt, net of discounts | 1,977,030 | 195,245 | ||||||
| Total current liabilities | 9,920,160 | 6,412,938 | ||||||
| Total liabilities | 9,920,160 | 6,412,938 | ||||||
| Commitments and contingencies | - | - | ||||||
| Stockholders’ equity (deficit): | ||||||||
| Preferred stock, par value: $0.001; 10,000,000 shares authorized, none issued and outstanding as of March 31, 2019 and 2018 | - | - | ||||||
| Common stock, par value $0.001; 10,000,000,000 shares authorized; 2,640,161,318 and 2,169,661,318 shares issued and outstanding as of March 31, 2019 and 2018, respectively | 2,640,161 | 2,169,661 | ||||||
| Additional paid in capital | 23,758,917 | 16,137,945 | ||||||
| Accumulated other comprehensive income (loss) | 1,363 | (2,483 | ) | |||||
| Accumulated deficit | (25,096,983 | ) | (20,085,947 | ) | ||||
| Total Investview stockholders’ equity (deficit) | 1,303,458 | (1,780,824 | ) | |||||
| Noncontrolling interest | 51,485 | 18,544 | ||||||
| Total stockholders’ equity (deficit) | 1,354,943 | (1,762,280 | ) | |||||
| Total liabilities and stockholders’ equity (deficit) | $ | 11,275,103 | $ | 4,650,658 | ||||
The accompanying notes are an integral part of these consolidated financial statements
| F-3 |
CONSOLIDATED STATEMENTS OF OPERATIONS
Year Ended March 31, | ||
2018 | 2017 | |
| Revenue: | ||
| Subscription revenue, net of refunds, incentives, credits, and chargebacks | $13,899,579 | $12,872,947 |
| Cryptocurrency mining service revenue, net of amounts paid to supplier | 4,017,853 | - |
| Total revenue, net | 17,917,432 | 12,872,947 |
| Operating costs and expenses: | ||
| Cost of sales and service | 6,713,097 | 862,849 |
| Commissions | 14,271,926 | 9,412,655 |
| Selling and marketing | 454,225 | 500,032 |
| Salary and related | 2,270,479 | 1,918,199 |
| Professional fees | 2,572,831 | 917,308 |
| General and administrative | 2,311,028 | 1,199,564 |
| Total operating costs and expenses | 28,593,586 | 14,810,607 |
| Net loss from operations | (10,676,154) | (1,937,660) |
| Other income (expense): | ||
| Loss on debt extinguishment | (2,767,422) | - |
| Loss on spin-off of operations | (1,118,609) | - |
| Realized loss on cryptocurrency | (10,939) | - |
| Unrealized loss on cryptocurrency | (135,729) | - |
| Interest expense - related parties | (104,105) | (274,057) |
| Interest expense | (74,976) | (205,327) |
| Other income (expense) | (493) | (6,120) |
| Total other income (expense) | (4,212,273) | (485,504) |
| Loss before income taxes | (14,888,427) | (2,423,164) |
| Income tax expense | (24,589) | (4,039) |
| Net Loss | $(14,913,016) | $(2,427,203) |
| Loss per common share, basic and diluted | $(0.01) | $(0.07) |
| Weighted average number of common shares outstanding, basic and diluted | 1,911,786,477 | 32,921,458 |
| Year Ended March 31, | ||||||||
| 2019 | 2018 | |||||||
| Revenue: | ||||||||
| Subscription revenue, net of refunds, incentives, credits, and chargebacks | $ | 27,023,202 | $ | 13,899,579 | ||||
| Equipment sales, net of refunds | 694,954 | - | ||||||
| Cryptocurrency mining service revenue, net of refunds and amounts paid to supplier | 1,940,925 | 4,017,853 | ||||||
| Total revenue, net | 29,659,081 | 17,917,432 | ||||||
| Operating costs and expenses: | ||||||||
| Cost of sales and service | 1,180,671 | 6,713,097 | ||||||
| Commissions | 21,526,326 | 14,271,926 | ||||||
| Selling and marketing | 878,936 | 454,225 | ||||||
| Salary and related | 4,272,355 | 2,270,479 | ||||||
| Professional fees | 1,620,370 | 2,572,831 | ||||||
| General and administrative | 4,121,279 | 2,311,028 | ||||||
| Total operating costs and expenses | 33,599,937 | 28,593,586 | ||||||
| Net loss from operations | (3,940,856 | ) | (10,676,154 | ) | ||||
| Other income (expense): | ||||||||
| Gain (loss) on debt extinguishment | 19,387 | (2,767,422 | ) | |||||
| Loss on fair value of derivative liability | (214,376 | ) | - | |||||
| Loss on spin-off of operations | - | (1,118,609 | ) | |||||
| Gain on bargain purchase | 971,282 | - | ||||||
| Realized gain (loss) on cryptocurrency | 16,241 | (10,939 | ) | |||||
| Unrealized gain (loss) on cryptocurrency | 106,488 | (135,729 | ) | |||||
| Interest expense - related parties | (20,000 | ) | (104,105 | ) | ||||
| Interest expense | (1,842,461 | ) | (74,976 | ) | ||||
| Other income (expense) | (3,032 | ) | (493 | ) | ||||
| Total other income (expense) | (966,471 | ) | (4,212,273 | ) | ||||
| Income (loss) before income taxes | (4,907,327 | ) | (14,888,427 | ) | ||||
| Income tax expense | (70,768 | ) | (24,589 | ) | ||||
| Net income (loss) | (4,978,095 | ) | (14,913,016 | ) | ||||
| Less: net income (loss) attributable to the noncontrolling interest | 32,941 | - | ||||||
| Net income (loss) attributable to Investview stockholders | $ | (5,011,036 | ) | $ | (14,913,016 | ) | ||
| Income (loss) per common share, basic and diluted | $ | (0.00 | ) | $ | (0.01 | ) | ||
| Weighted average number of common shares outstanding, basic and diluted | 2,234,117,482 | 1,911,786,477 | ||||||
| Other comprehensive income, net of tax: | ||||||||
| Foreign currency translation adjustments | $ | 3,846 | $ | - | ||||
| Total other comprehensive income | 3,846 | - | ||||||
| Comprehensive income (loss) | (4,974,249 | ) | (14,913,016 | ) | ||||
| Less: comprehensive income attributable to the noncontrolling interest | (3,846 | ) | - | |||||
| Comprehensive income (loss) attributable to Investview shareholders | $ | (4,978,095 | ) | $ | (14,913,016 | ) | ||
The accompanying notes are an integral part of these consolidated financial statements
| F-4 |
CONSOLIDATED STATEMENTSTATEMENTS OF STOCKHOLDERS' DEFICIT
Common | Accumulated | |||||||
Additional | Stock | Other | ||||||
Common stock | Paid in | Subscription | Treasury | Accumulated | Comprehensive | |||
Shares | Amount | Capital | Receivable | Stock | Deficit | Income | Total | |
| Balance, March 31, 2016 | 14,966,911 | $14,967 | $(686,028) | $(250,000) | $(8,589) | $(2,727,184) | $- | $(3,656,834) |
| Common stock issued for cash | 10,670,840 | 10,671 | 146,829 | - | - | - | - | 157,500 |
| Common stock issued for services | 6,072,200 | 6,072 | 25,703 | - | - | - | - | 31,775 |
| Common stock issued in payment of compensation | 21,069,580 | 21,070 | 962,666 | - | - | - | - | 983,736 |
| Common stock issued for director fees | 400,000 | 400 | 25,400 | - | - | - | - | 25,800 |
| Common stock issued in settlement of debt | 72,709,924 | 72,710 | 303,289 | - | - | - | - | 375,999 |
| Reclass derivative liability to equity upon convertible note payoff | - | - | 277,778 | - | - | - | - | 277,778 |
| Contributed capital | - | - | (250,000) | 250,000 | - | - | - | - |
| Net loss | - | - | - | - | - | (2,427,203) | - | (2,427,203) |
| Balance, March 31, 2017 | 125,889,455 | 125,890 | 805,637 | - | (8,589) | (5,154,387) | - | (4,231,449) |
| Common stock issued for cash | 267,127,500 | 267,128 | 2,854,648 | - | - | - | - | 3,121,776 |
| Common stock issued for license agreement | 80,000,000 | 80,000 | 2,176,000 | - | - | - | - | 2,256,000 |
| Common stock issued for services | 94,375,333 | 94,375 | 6,632,860 | - | - | - | - | 6,727,235 |
| Common stock issued in settlement of debt | 239,575,884 | 239,576 | 5,377,558 | - | - | - | - | 5,617,134 |
| Wealth Generators reverse acquisition | 1,358,670,942 | 1,358,670 | (804,759) | - | - | - | - | 553,911 |
| Offering costs | 4,273,504 | 4,273 | (269,273) | - | - | - | - | (265,000) |
| Cancellation of stock | (250,000) | (250) | 250 | - | - | - | - | - |
| Cancellation of treasury stock | (1,300) | (1) | (8,588) | - | 8,589 | - | - | - |
| Price protection guarantee | - | - | (626,388) | - | - | - | - | (626,388) |
| Foreign currency translation adjustment | - | - | - | - | - | - | (2,483) | (2,483) |
| Net loss | - | - | - | - | - | (14,913,016) | - | (14,913,016) |
| Balance, March 31, 2018 | 2,169,661,318 | $2,169,661 | $16,137,945 | $- | $- | $(20,067,403) | $(2,483) | $(1,762,280) |
YEARS ENDED MARCH 31, 2019 AND 2018
| Common stock | Additional Paid in | Treasury | Accumulated Other Comprehensive | Accumulated | Noncontrolling | |||||||||||||||||||||||||||
| Shares | Amount | Capital | Stock | Income | Deficit | Interest | Total | |||||||||||||||||||||||||
| Balance, March 31, 2017 | 125,889,455 | $ | 125,890 | $ | 805,637 | $ | (8,589 | ) | $ | - | $ | (5,154,387 | ) | $ | - | $ | (4,231,449 | ) | ||||||||||||||
| Common stock issued for cash | 267,127,500 | 267,128 | 2,228,260 | - | - | - | - | 2,495,388 | ||||||||||||||||||||||||
| Common stock issued for license agreement | 80,000,000 | 80,000 | 2,176,000 | - | - | - | - | 2,256,000 | ||||||||||||||||||||||||
| Common stock issued for services | 94,375,333 | 94,375 | 6,632,860 | - | - | - | - | 6,727,235 | ||||||||||||||||||||||||
| Common stock issued in settlement of debt | 239,575,884 | 239,576 | 5,377,558 | - | - | - | - | 5,617,134 | ||||||||||||||||||||||||
| Wealth Generators reverse acquisition | 1,358,670,942 | 1,358,670 | (804,759 | ) | - | - | - | - | 553,911 | |||||||||||||||||||||||
| Offering costs | 4,273,504 | 4,273 | (269,273 | ) | - | - | - | - | (265,000 | ) | ||||||||||||||||||||||
| Cancellation of stock | (250,000 | ) | (250 | ) | 250 | - | - | - | - | - | ||||||||||||||||||||||
| Cancellation of treasury stock | (1,300 | ) | (1 | ) | (8,588 | ) | 8,589 | - | - | - | - | |||||||||||||||||||||
| Foreign currency translation adjustment | - | - | - | - | (2,483 | ) | - | - | (2,483 | ) | ||||||||||||||||||||||
| Net income (loss) | - | - | - | - | - | (14,931,560 | ) | 18,544 | (14,913,016 | ) | ||||||||||||||||||||||
| Balance, March 31, 2018 | 2,169,661,318 | 2,169,661 | 16,137,945 | - | (2,483 | ) | (20,085,947 | ) | 18,544 | (1,762,280 | ) | |||||||||||||||||||||
| Common stock issued for acquisition | 50,000,000 | 50,000 | 750,000 | - | - | - | - | 800,000 | ||||||||||||||||||||||||
| Common stock issued for services and compensation | 402,000,000 | 402,000 | 6,385,600 | - | - | - | - | 6,787,600 | ||||||||||||||||||||||||
| Common stock repurchase | (7,000,000 | ) | (7,000 | ) | (84,000 | ) | - | - | - | - | (91,000 | ) | ||||||||||||||||||||
| Common stock issued as commitment fees | 22,500,000 | 22,500 | 47,372 | - | - | - | - | 69,872 | ||||||||||||||||||||||||
| Offering costs | 3,000,000 | 3,000 | 522,000 | - | - | - | - | 525,000 | ||||||||||||||||||||||||
| Foreign currency translation adjustment | - | - | - | - | 3,846 | - | - | 3,846 | ||||||||||||||||||||||||
| Net income (loss) | - | - | - | - | - | (5,011,036 | ) | 32,941 | (4,978,095 | ) | ||||||||||||||||||||||
| Balance, March 31, 2019 | 2,640,161,318 | $ | 2,640,161 | $ | 23,758,917 | $ | - | $ | 1,363 | $ | (25,096,983 | ) | $ | 51,485 | $ | 1,354,943 | ||||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements
| F-5 |
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended March 31, | ||
2018 | 2017 | |
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||
| Net loss | $(14,913,016) | $(2,427,203) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
| Depreciation | 2,639 | 2,270 |
| Stock issued for services and license agreement | 6,846,059 | - |
| Debt issuance costs - related party | - | 274,057 |
| Debt issuance costs | - | 205,327 |
| Loss on spin-off of operations | 1,118,609 | - |
| Loss on debt settlement | 2,767,422 | - |
| Realized loss on cryptocurrency | 10,939 | - |
| Unrealized loss on cryptocurrency | 135,729 | - |
| Changes in operating assets and liabilities: | ||
| Receivables | 122,053 | (327,630) |
| Prepaid assets | - | - |
| Deposits | 1,500 | (1,500) |
| Short term advances from related parties | (36,510) | - |
| Other current assets | (627,038) | - |
| Accounts payable and accrued liabilities | 2,924,522 | 656,458 |
| Deferred revenue | 422,369 | (24,056) |
| Accrued interest | 74,953 | - |
| Accrued interest - related parties | 104,105 | - |
| Net cash used in operating activities | (1,045,665) | (1,642,277) |
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||
| Proceeds from short term advances | - | 100,000 |
| Repayments for short term advances | - | (110,000) |
| Repayments for related party advances | - | 194,977 |
| Cash received in reverse acquisition | 3,550 | - |
| Payments for fixed assets | (11,264) | - |
| Net cash provided by (used in) investing activities | (7,714) | 184,977 |
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||
| Proceeds from related parties | 498,380 | 1,370,788 |
| Repayments for related party payables | (1,316,500) | (1,360,044) |
| Proceeds from debt | 1,675,000 | 1,824,965 |
| Repayments for debt | (1,424,578) | (267,577) |
| Proceeds from the sale of stock | 3,121,776 | - |
| Proceeds from the sale of members interests | - | 25,000 |
| Payments for offering cost | (15,000) | - |
| Distributions to members | - | (204,514) |
| Net cash provided by financing activities | 2,539,078 | 1,388,618 |
| Effect of exchange rate translation on cash | 3,371 | - |
| Net increase (decrease) in cash and cash equivalents | 1,489,070 | (68,682) |
| Cash and cash equivalents-beginning of period | 1,616 | 70,298 |
| Cash and cash equivalents-end of period | $1,490,686 | $1,616 |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
| Cash paid during the period for: | ||
| Interest | $117,500 | $198,162 |
| Income taxes | $24,589 | $4,039 |
| Non cash investing and financing activities: | ||
| Common stock issued for reverse acquisition | $662,048 | $- |
| Common stock issued in settlement of related party payables | $90,000 | $- |
| Common stock issued in settlement of debt | $2,232,606 | $- |
| Common stock issued for prepaid services and long term license agreement | $2,137,175 | $- |
| Cancellation of Shares | $250 | $- |
| Cancellation of Treasury Shares | $8,589 | $- |
| Liability for offering cost | $250,000 | $- |
| Shares issued for offering cost | $4,274 | $- |
| Price protection guarantee | $626,388 | $- |
| Year Ended March 31, | ||||||||
| 2019 | 2018 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | (4,978,095 | ) | $ | (14,913,016 | ) | ||
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
| Depreciation | 5,332 | 2,639 | ||||||
| Amortization of debt discount | 1,052,523 | - | ||||||
| Amortization of long-term license agreement | 150,400 | - | ||||||
| Amortization of intangible assets | 239,315 | - | ||||||
| Stock issued for services, compensation, and license agreement | 109,240 | 6,846,059 | ||||||
| Loan fees on new borrowings | 704,397 | - | ||||||
| Loss on spin-off of operations | - | 1,118,609 | ||||||
| Gain on bargain purchase | (971,282 | ) | - | |||||
| (Gain) loss on debt extinguishment | (19,387 | ) | 2,767,422 | |||||
| Loss on fair value of derivative liability | 214,376 | - | ||||||
| Realized (gain) loss on cryptocurrency | (16,241 | ) | 10,939 | |||||
| Unrealized (gain) loss on cryptocurrency | (106,488 | ) | 135,729 | |||||
| Changes in operating assets and liabilities: | ||||||||
| Receivables | 108,907 | 122,053 | ||||||
| Prepaid assets | (4,055 | ) | - | |||||
| Short-term advances from related parties | 36,010 | (36,510 | ) | |||||
| Other current assets | 461,038 | (627,038 | ) | |||||
| Deposits | - | 1,500 | ||||||
| Accounts payable and accrued liabilities | (1,314,971 | ) | 2,924,522 | |||||
| Customer advance | 265,000 | - | ||||||
| Deferred revenue | 1,016,385 | 422,369 | ||||||
| Accrued interest | 59,345 | 74,953 | ||||||
| Accrued interest - related parties | 5,000 | 104,105 | ||||||
| Net cash used in operating activities | (2,983,251 | ) | (1,045,665 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Payments for fixed assets | - | (11,264 | ) | |||||
| Cash received in acquisition | 3,740 | 3,550 | ||||||
| Net cash provided by investing activities | 3,740 | (7,714 | ) | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Proceeds from related parties | 1,905,777 | 498,380 | ||||||
| Repayments for related party payables | (1,367,168 | ) | (1,316,500 | ) | ||||
| Proceeds from debt | 4,115,961 | 1,675,000 | ||||||
| Repayments for debt | (2,936,044 | ) | (1,424,578 | ) | ||||
| Payments for share repurchase | (91,000 | ) | - | |||||
| Proceeds from the sale of stock | - | 3,121,776 | ||||||
| Payments for offering costs | - | (15,000 | ) | |||||
| Net cash provided by financing activities | 1,627,526 | 2,539,078 | ||||||
| Effect of exchange rate translation on cash | (5,057 | ) | 3,371 | |||||
| Net increase (decrease) in cash and cash equivalents | (1,357,042 | ) | 1,489,070 | |||||
| Cash and cash equivalents-beginning of period | 1,490,686 | 1,616 | ||||||
| Cash and cash equivalents-end of period | $ | 133,644 | $ | 1,490,686 | ||||
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||||||||
| Cash paid during the period for: | ||||||||
| Interest | $ | 51,000 | $ | 117,500 | ||||
| Income taxes | $ | 70,768 | $ | 24,589 | ||||
| Non cash investing and financing activities: | ||||||||
| Common stock issued for acquisition | $ | 800,000 | $ | 662,048 | ||||
| Common stock issued in settlement of related party payables | $ | - | $ | 90,000 | ||||
| Common stock issued in settlement of debt | $ | - | $ | 2,232,606 | ||||
| Common stock issued for prepaid services and long term license agreement | $ | 6,678,360 | $ | 2,137,175 | ||||
| Cancellation of shares | $ | - | $ | 250 | ||||
| Cancellation of treasury shares | $ | - | $ | 8,589 | ||||
| Reductions to equity for offering costs accrued | $ | 525,000 | $ | - | ||||
| Liability for offering costs | $ | - | $ | 250,000 | ||||
| Shares issued for offering costs | $ | 3,000 | $ | 4,274 | ||||
| Price protection guarantee | $ | - | $ | 626,388 | ||||
| Derivative liability recorded as a debt discount | $ | 510,000 | $ | - | ||||
The accompanying notes are an integral part of these consolidated financial statements
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS
Organization
Investview, Inc. was incorporated on January 30, 1946, under the laws of the state of Utah as the Uintah Mountain Copper Mining Company. In January 2005, the Companywe changed domicile to Nevada and changed itsour name to Voxpath Holding, Inc. In September of 2006, the Companywe merged The Retirement Solution Inc. through a Share Purchase Agreement into Voxpath Holdings, Inc. and then changed itsour name to TheRetirementSolution.Com, Inc. and in October 2008 changed itsour name to Global Investor Services, Inc., before changing itsour name to Investview, Inc., on March 27, 2012.
On March 31, 2017, we entered into a Contribution Agreement with the members of Wealth Generators, LLC, a limited liability company (“Wealth Generators”), pursuant to which the Wealth Generators members agreed to contribute 100% of the outstanding securities of Wealth Generators in exchange for an aggregate of 1,358,670,942 shares of our common stock. The closing of the Contribution Agreement was effective April 1, 2017, and Wealth Generators became our wholly owned subsidiary and the former members of Wealth Generators became our stockholders and control the majority of our outstanding common stock (see Note 5).
On June 6, 2017, we entered into an Acquisition Agreement with Market Trend Strategies, LLC, a company whose members are also former members of our management. Under the Acquisition Agreement, we spun-off our operations that existed prior to the merger with Wealth Generators and sold the intangible assets used in those pre-merger operations in exchange for Market Trend Strategies’ assumption of $419,139 in pre-merger liabilities.
On February 28, 2018, we filed a name change for Wealth Generators, LLC to Kuvera, LLC (“Kuvera”).
On July 20, 2018, we entered into a Purchase Agreement with United Games Marketing LLC, a Utah limited liability company, to purchase its wholly owned subsidiaries United Games, LLC and United League, LLC for 50,000,000 shares of Business
On November 12, 2018, we established Kuvera France, S.A.S. to handle sales of our financial education and research in the European Union.
On December 30, 2018, our wholly owned subsidiary S.A.F.E. Management, LLC received its registration and disclosure approval from the National Futures Association. S.A.F.E. Management, LLC is now a New Jersey State Registered Investment Adviser, Commodities Trading Advisor, Commodity Pool Operator, and approved for over the counter FOREX advisory services.
On January 17, 2019, we renamed our non-operating wholly owned subsidiary WealthGen Global, LLC to SafeTek, LLC, a Utah limited liability company.
Nature of Business
We own a number of companies that each operate independently, but are accretive to one another. We are establishing a portfolio of wholly owned subsidiaries delivering leading-edge technologies, services, and research, dedicated primarily to the individual consumer. Following is a description of each of our companies.
Kuvera, we provideLLC provides research, education, and investment tools designed to assist the self-directed investor in successfully navigating the financial markets. These services include research, trade alerts, and live trading rooms that include instruction in equities, options, FOREX, ETFs, binary options, crowdfunding and cryptocurrency mining services and sector education. In addition to trading tools and research, we also offer full education and software applications to assist the individual in debt reduction, increased savings, budgeting, and proper tax management. Each product subscription includes a core set of trading tools/research along with the personal finance management suite to provide an individual with complete access to the information necessary to cultivate and manage his or her financial situation. Different packages are available through a monthly subscription that can be cancelled at any time at the discretion of the customer. A unique component of the product marketing plan is the distribution method whereby all subscriptions are sold via current participating customers who choose to distribute and sell the services by participating in the bonus plan. The bonus plan participation is purely optional but enables individuals to create an additional income stream to further support their personal financial goals and objectives.
Kuvera France S.A.S. is our entity in France that will distribute Kuvera products and services throughout the European Union.
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
S.A.F.E. Management, LLC is a Registered Investment Adviser and Commodity Trading Adviser that has been established to deliver automated trading strategies to individuals who find they lack the time to trade for themselves.
United League, LLC owns a number of proprietary technologies including FIREFAN a social app for sports enthusiasts. Technologies created to support any of the Investview companies are held under the United League structure.
United Games, LLC is the distribution network for United League technologies. Since the acquisition of United Games in July of 2018, we are working to combine the distributors of Kuvera and United Games. This is an on-going process.
SafeTek, LLC (formerly WealthGen Global, LLC) is a new addition that we are currently establishing for expansion plans in the high-speed processing and cloud computing environment.
Investment Tools & Training, LLCandRazor Data Corp. currently have no operations or activities.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
Our policy is to prepare itsour financial statements on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
Principles of Consolidation
The consolidated financial statements include the accounts of Investview, Inc., and our wholly owned subsidiaries, Kuvera, LLC, Investment Tools & Training, LLC, Razor Data Corp., S.A.F.E. Management, LLC, SafeTek, LLC (formerly WealthGen Global, LLC), United Games, LLC, United League, LLC, and SAFE Management, LLC.Kuvera France S.A.S. We have determined that one affiliated entity, Kuvera LATAM S.A.S., which we conduct business with, is a variable interest entity and we are the primary beneficiary of the entities activities.entity’s activities, which are similar to those of Kuvera, LLC. As a result, we have consolidated the accounts of this variable interest entity into the accompanying consolidated financial statements. Further, because we do not have any ownership interest in this variable interest entity, we have allocated the contributed capital in the variable interest entity as a component of noncontrolling interest. All intercompany transactions and balances have been eliminated in consolidation.
Use of Estimates
The preparation of these financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Foreign Exchange
We have consolidated the accounts of Kuvera France S.A.S. and Kuvera LATAM S.A.S. into our consolidated financial statements. The operations of Kuvera France S.A.S. are conducted in France and its functional currency is the Euro. The operations of Kuvera LATAM S.A.S. are conducted in Colombia and its functional currency is the Colombian Peso.
The financial statements of Kuvera France S.A.S. and Kuvera LATAM S.A.S. are prepared using the Colombian Pesotheir respective functional currency and have been translated into U.S. dollars (“USD”). Assets and liabilities are translated into USD at the applicable exchange rates at period-end. Stockholders’ equity is translated using historical exchange rates. Revenue and expenses are translated at the average exchange rates for the period. Any translation adjustments are included as foreign currency translation adjustments in accumulated other comprehensive income in our stockholders’ equity (deficit).
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
The following rates were used to translate the accounts of Kuvera France S.A.S. and Kuvera LATAM S.A.S. into USD at the following balance sheet dates.
| March 31, 2019 | March 31, 2018 | |||||||
| Euro to USD | 1.12200 | n/a | ||||||
| Colombian Peso to USD | 0.00031 | 0.00036 | ||||||
The following rates were used to translate the accounts of
Kuvera France S.A.S. and Kuvera LATAM S.A.S. into USD for the following operatingYear ended March 31, | ||
2018 | 2017 | |
| Colombian Peso to USD | 0.00034 | n/a |
| Year ended March 31, | ||||||||
| 2019 | 2018 | |||||||
| Euro to USD | 1.13580 | n/a | ||||||
| Colombian Peso to USD | 0.00033 | 0.00034 | ||||||
Concentration of Credit Risk
Financial instruments that potentially expose the Companyus to concentration of credit risk include cash, accounts receivable, and advances. The Company places itsWe place our cash and temporary cash investments with credit quality institutions. At times, such investments may be in excess of the FDIC insurance limit of $250,000. As of March 31, 20182019 and 20172018, cash balances that exceeded FDIC limits were $1,095,329$0 and $0,$1,095,329, respectively, and the Company haswe have not experienced significant losses relating to these concentrations in the past.
Cash and Cash Equivalents
For purposes of reporting cash flows, the Company considerswe consider all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents. As of March 31, 2019 and 2018, and 2017 the Companywe had no cash equivalents.
Receivables
Receivables are carried at net realizable value, representing the outstanding balance less an allowance for doubtful accounts based on a review of all outstanding amounts. Management determines the allowance for doubtful accounts by regularly evaluating individual receivables and receivables are written off when deemed uncollectible. Recoveries of receivables previously written off are recorded when received. The CompanyWe had no allowance for doubtful accounts as of March 31, 20182019 and 2017.
Cryptocurrencies
We hold cryptocurrency-denominated assets (“cryptocurrencies”) and include them in our consolidated balance sheet as other current assets. We record cryptocurrencies at fair market value and recognize the change in the fair value of our cryptocurrencies as an unrealized gain or loss in the consolidated statement of operations. As of March 31, 20182019 and March 31, 20172018, the fair value of our cryptocurrencies was $142,061 and $480,370, respectively. During the year ended March 31, 2019, we recorded $16,241 and $0,$106,488 as realized and unrealized gain (loss) on cryptocurrency, respectively. During the year ended March 31, 2018, we recorded $(10,939) and $(135,729) as realized and unrealized gain (loss) on cryptocurrency, respectively. We recorded no realized or unrealized gain (loss) on cryptocurrencies during the year ended March 31, 2017.
Fixed Assets
Fixed assets are stated at cost and depreciated using the straight-line method over their estimated useful lives as follows:
| Furniture, fixtures, and equipment | 10 years | ||
| Computer equipment | 3 years |
When retired or otherwise disposed, the carrying value and accumulated depreciation of the fixed asset is removed from its respective accounts and the net difference less any amount realized from disposition, is reflected in earnings. Expenditures for maintenance and repairs which do not extend the useful lives of the related assets are expensed as incurred.
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
Fixed assets are presented net of accumulated depreciation of $7,173$12,505 and $4,534,$7,173, as of March 31, 20182019 and 2017,2018, respectively. Total depreciation expense for the years ended March 31, 2019 and 2018, was $5,332 and 2017 was $2,639, and $2,270, respectively.
Long-Lived Assets – Intangible Assets & License Agreement
We account for our intangible assets and long-term license agreement in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), Subtopic 350-30, General Intangibles Other Than Goodwill, (“and ASC 350-30”).Subtopic 360-10-05, Accounting for the Impairment or Disposal of Long-Lived Assets. ASC Subtopic 350-30 requires assets to be measured based on the fair value of the consideration given or the fair value of the assets (or net assets) acquired, whichever is more clearly evident and, thus, more reliably measurable. Further, ASC Subtopic 350-30 requires an intangible asset to be amortized over its useful life which we have determinedand for the useful life to be 15 years.evaluated every reporting period to determine whether events or circumstances warrant a revision to the remaining period of amortization. If the estimate of useful life is changed the remaining carrying amount of the intangible asset is amortized prospectively over the revised remaining useful life. Costs of internally developing, maintaining, or restoring intangible assets are recognized as an expense when incurred.
In June of 2017 we issued 80,000,000 shares of common stock with a value of $2,256,000 for a 15-year license agreement. Annual amortization over the 15-year life is expected to be $150,400 related to ourper year. Amortization recognized for the year ended March 31, 2019 and 2018, was $150,400 and $122,380, respectively, and the long-term license agreement.
In June of 2018 we purchased United Games, LLC and United League, LLC and recorded the transaction as a business combination (see Note 5). Intangible assets acquired in the business combination were recorded at fair value on the date of acquisition and are being amortized on a straight-line method over their estimated useful lives.
| Estimated | ||||||||
| Useful | ||||||||
| Life | ||||||||
| (years) | Value | |||||||
| FireFan mobile application | 4 | $ | 331,000 | |||||
| Back office software | 10 | 408,000 | ||||||
| Tradename/trademark - FireFan | 5 | 248,000 | ||||||
| Tradename/trademark - United Games | 0.45 | 4,000 | ||||||
| Customer contracts/relationships | 5 | 825,000 | ||||||
| 1,816,000 | ||||||||
| Accumulated amortization as of March 31, 2019 | (239,315 | ) | ||||||
| Net book value, March 31, 2019 | $ | 1,576,685 | ||||||
Amortization expense is expected to be as follows:
| Fiscal year ending March 31, 2020 | $ | 338,150 | ||
| Fiscal year ending March 31, 2021 | 338,150 | |||
| Fiscal year ending March 31, 2022 | 338,150 | |||
| Fiscal year ending March 31, 2023 | 280,565 | |||
| Fiscal year ending March 31, 2024 and beyond | 281,670 | |||
| $ | 1,576,685 |
Impairment of Long-Lived Assets
We have adopted ASC Subtopic 360-10, Property, Plant and Equipment (“ASC 360-10”).Equipment. ASC 360-10 requires that long-lived assets and certain identifiable intangibles held and used by the Companyus be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable or when the historical cost carrying value of an asset may no longer be appropriate. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve break-even operating results over an extended period.
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
We evaluate the recoverability of long-lived assets based upon future net cash flows expected to result from the asset, including eventual disposition. Should impairment in value be indicated, the carrying value of intangible assets will be adjusted and an impairment loss is recorded equal to the difference between the asset’s carrying value and fair value or disposable value.
Fair Value of Financial Instruments
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, based on our principal or, in the absence of a principal, most advantageous market for the specific asset or liability.
U.S. generally accepted accounting principles provide for a three-level hierarchy of inputs to valuation techniques used to measure fair value, defined as follows:
| Level 1: | Inputs that are quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity can access. | |
| Level 2: | Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability, including: |
| - | quoted prices for similar assets or liabilities in active markets; | |
| - | quoted prices for identical or similar assets or liabilities in markets that are not active; | |
| - | inputs other than quoted prices that are observable for the asset or liability; and | |
| - | inputs that are derived principally from or corroborated by observable market data by correlation or other means. |
| Level 3: | Inputs that are unobservable and reflect management’s own assumptions about the inputs market participants would use in pricing the asset or liability based on the best information available in the circumstances (e.g., internally derived assumptions surrounding the timing and amount of expected cash flows). |
Our financial instruments consist of cash, accounts receivable, and accounts payable. We have determined that the book value of our outstanding financial instruments as of March 31, 20182019 and March 31, 2017,2018, approximates the fair value due to their short-term nature.
Items recorded or measured at fair value on a recurring basis in the accompanying consolidated financial statements consisted of the following items as of March 31, 2019:
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Cryptocurrencies | $ | 142,061 | $ | - | $ | - | $ | 142,061 | ||||||||
| Total Assets | $ | 142,061 | $ | - | $ | - | $ | 142,061 | ||||||||
| Derivative liability | $ | - | $ | 1,358,901 | $ | - | $ | 1,358,901 | ||||||||
| Total Liabilities | $ | - | $ | 1,358,901 | $ | - | $ | 1,358,901 | ||||||||
Items recorded or measured at fair value on a recurring basis in the accompanying consolidated financial statements consisted of the following items as of March 31, 2018:
Level 1 | Level 2 | Level 3 | Total | |
| Cryptocurrencies | $480,370 | $- | $- | $480,370 |
| Total Assets | $480,370 | $- | $- | $480,370 |
| Total Liabilities | $- | $- | $- | $- |
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Cryptocurrencies | $ | 480,370 | $ | - | $ | - | $ | 480,370 | ||||||||
| Total Assets | $ | 480,370 | $ | - | $ | - | $ | 480,370 | ||||||||
| Total Liabilities | $ | - | $ | - | $ | - | $ | - | ||||||||
Revenue Recognition
Effective April 1, 2018, we adopted the ASC Subtopic 606-10, Revenue from Contracts with Customers. The adoption of ASC 606-10 had no impact on prior year or previously disclosed amounts. In accordance with ASC 606-10, revenue is measured at fair valuebased on a recurring basisconsideration specified in a contract with a customer and recognized when we satisfy the accompanying consolidated financial statements consisted of the following items as of Marchperformance obligation specified in each contract.
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2017:
The majority of our revenue is generated by subscription sales and payment is received at the time of purchase. WeOur performance obligation is to provide services over a fixed subscription period; therefore, we recognize revenue for subscription salesratably over the subscription period and deferred revenue is recorded for the portion of the subscription period subsequent to each reporting date. Additionally, we offer a 10-day trial period to subscription customers, during which a full refund can be requested if a customer does not like the product. Revenues are deferred during the trial period as collectability cannot be reasonably assuredcollection is not probable until that time has passed. Revenues are presented net of refunds, sales incentives, credits, known and estimated refunds, and known and estimated credit card chargebacks.
We generate revenue from the sale of cryptocurrency mining services to our customers through ouran arrangement with a third-party supplier. We report net revenue retainedOur performance obligation is to arrange for the third-party to provide mining services to our customers and payment is received at the time of purchase, therefore revenue is recognized upon receipt of payment. We recognize revenue in the amount of the fee to which represents our fees earnedwe are entitled to as an agent.
We generate revenue from the sale of high-speed computer processing equipment that is used for any of the following intense processing activities: protein folding, CGI rendering, game streaming, machine & deep learning, mining, independent financial verification, and general high-speed computing. Our performance obligation is to deliver an equipment package to our customers that includes hardware, software, and firmware and is drop-shipped to a hosting data center. We receive payment at the time of purchase and recognize revenue when the equipment package is delivered and ready for maintenance and hosting, which our customers arrange for, and obtain, from a separate third party that provides such services.
Revenue generated for the yearsyear ended March 31, 2019, was as follows:
| Subscription Revenue | Equipment Sales | Cryptocurrency Mining Revenue | Total | |||||||||||||
| Gross billings | $ | 28,518,660 | $ | 698,954 | $ | 5,775,269 | $ | 34,992,883 | ||||||||
| Refunds, incentives, credits, and chargebacks | (1,495,458 | ) | (4,000 | ) | (6,501 | ) | (1,505,959 | ) | ||||||||
| Amounts paid to supplier | - | - | (3,827,843 | ) | (3,827,843 | ) | ||||||||||
| Net revenue | $ | 27,023,202 | $ | 694,954 | $ | 1,940,925 | $ | 29,659,081 | ||||||||
Revenue generated for the year ended March 31, 2018, and 2017, iswas as follows:
March 31, 2018 | March 31, 2017 | |||||
Subscription Revenue | Cryptocurrency Mining Revenue | Total | Subscription Revenue | Cryptocurrency Mining Revenue | Total | |
| Gross billings | $14,758,614 | $8,885,798 | $23,644,412 | $14,578,164 | $- | $14,578,164 |
| Refunds, incentives, credits, and chargebacks | (859,035) | - | (859,035) | (1,705,217) | - | (1,705,217) |
| Amounts paid to supplier | - | (4,867,945) | (4,867,945) | - | - | - |
| Net revenue | $13,899,579 | $4,017,853 | $17,917,432 | $12,872,947 | $- | $12,872,947 |
| Subscription Revenue | Equipment Sales | Cryptocurrency Mining Revenue | Total | |||||||||||||
| Gross billings | $ | 14,758,614 | $ | - | $ | 8,885,798 | $ | 23,644,412 | ||||||||
| Refunds, incentives, credits, and chargebacks | (859,035 | ) | - | - | (859,035 | ) | ||||||||||
| Amounts paid to supplier | - | - | (4,867,945 | ) | (4,867,945 | ) | ||||||||||
| Net revenue | $ | 13,899,579 | $ | - | $ | 4,017,853 | $ | 17,917,432 | ||||||||
Advertising, Selling, and Marketing Costs
We expense advertising, selling, and marketing costs as incurred. Advertising, selling, and marketing costs include costs of promoting our product worldwide, including promotional events. Advertising, selling, and marketing expenses for the years ended March 31, 2019 and 2018, totaled $878,936 and 2017 totaled $454,225, and $500,032, respectively.
Income Taxes
We have adopted ASC Subtopic 740-10, Income Taxes, which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Temporary differences between taxable income reported for financial reporting purposes and income tax purposes consist primarily of derivative liability and stock compensation accounting versus basis differences.
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
Net Income (Loss) per Share
We follow ASC Subtopic 260-10, Earnings per Share, which specifies the computation, presentation, and disclosure requirements of earnings per share information. Basic loss per share has been calculated based upon the weighted average number of common shares outstanding. Convertible debt, stock options, and warrants have been excluded as common stock equivalents in the diluted loss per share because their effect is anti-dilutive on the computation.
Potentially dilutive securities excluded from the computation of basic and diluted net loss per share are as follows:
March 31, 2018 | March 31, 2017 | |
| Convertible notes payable | - | 17,045,455 |
| Options to purchase common stock | 35,000 | 35,000 |
| Warrants to purchase common stock | 6,169,497 | 6,534,810 |
| Total | 6,204,497 | 23,615,265 |
| March 31, 2019 | March 31, 2018 | |||||||
| Convertible notes payable | - | - | ||||||
| Options to purchase common stock | 35,000 | 35,000 | ||||||
| Warrants to purchase common stock | 5,052,497 | 6,169,497 | ||||||
| Notes convertible into common stock | 52,162,055 | - | ||||||
| Total | 57,249,552 | 6,204,497 | ||||||
NOTE 3 – RECENT ACCOUNTING PRONOUNCEMENTS
In May 2014,February 2016, the FASB issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with CustomersASU No. 2016-02, “Leases (Topic 606)842)”.ASU 2014-09 creates a new topic in the ASC Topic 606 and establishes a new control-based revenue recognition model,2016-02 changes the basisaccounting for deciding when revenueleased assets, principally by requiring balance sheet recognition of assets under lease arrangements. It is recognized over time or at a point in time, provides new and more detailed guidance on specific topics, and expands and improves disclosures about revenue. In addition, ASU 2014-09 adds a new Subtopic to the Codification, ASC 340-40, Other Assets and Deferred Costs: Contracts with Customers, to provide guidance on costs related to obtaining a contract with a customer and costs incurred in fulfilling a contract with a customer that are not in the scope of another ASC Topic. The guidance in ASU 2014-09 is effective for public entities for annual reporting periods, and interim periods within those years, beginning after December 15, 2016, including interim periods therein. Early application is not permitted. Management is2018. In June of 2019, we signed a three-year lease agreement for office space in Eatontown, New Jersey, therefore we will adopt this standard effective April 1, 2019 and will account for our new lease agreement accordingly. We note that the processadoption of assessing theASU 2016-02 will have no other impact of ASU 2014-09 on the Company’sour consolidated financial statements.
There are no additional recently issued accounting pronouncements that we have not yet adopted that we believe are applicable or would have a material impact on our financial statements.
NOTE 4 – GOING CONCERN AND LIQUIDITY
Our financial statements are prepared using generally accepted accounting principles applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. We have incurred significant recurring losses, which have resulted in an accumulated deficit of $20,067,403$25,096,983 as of March 31, 2018,2019, along with a net loss of $14,913,016$5,011,036 and net cash used in operations of $1,045,665$2,983,251 for the year ended March 31, 2018.2019. Additionally, as of March 31, 2018,2019, we had a working capital deficit of $3,919,260.$2,222,990. These factors raise substantial doubt about our ability to continue as a going concern.
Historically we have relied on increasing revenues and new debt financing to pay for operational expenses and debt as it came due. During the year ended March 31, 2018,2019, we raised $498,380$1,905,777 in cash proceeds from related parties $1,675,000and $4,115,961 in cash proceeds from new lending arrangements. Subsequent to March 31, 2019, we obtained $200,000 in cash proceeds from new lending arrangements and $3,121,776received $325,000 from the sale of our common stock. Additionally, during the year ended March 31, 2018, we exchanged $2,322,606 worth
Since our acquisition of debt into sharesWealth Generators in April of common stock. Going forward we plan to reduce obligations with cash flow provided by operations and pursue additional debt and equity financing; however, we cannot assure that funds will be available on terms acceptable to us, or if available, will be sufficient to enable us to fully complete our development activities or sustain operations. Nevertheless, the shortage of working capital adversely affects our ability to develop or participate in activities that promote our business, because a substantial portion of cash flow goes to reduce debt rather than to advance operating activities. To address this,2017 we have implemented a seriesnumber of adjustmentsinitiatives and we are beginning to see the positive impact of these actions. First, our affiliate/distributor bonus plan. These adjustments are designed to bring the maximum payout percentage in line with company objectives. During the year ended March 31, 2018 thelargest subsidiary, Kuvera, has a bonus plan exceeded maximum payout on three occasions andstructure for distributors of our services which consistently paid out nearbeyond our maximum threshold. Adjustments to this bonus plan have been made over the maximum percentage.last 12 months with additional adjustments planned for the next two quarters. This resulted in a gradual reduction in bonus payouts which reduced our losses. Second, we expanded the objectives of Investview through the acquisition and creation of additional subsidiaries to increase our sources of income and creating business activities in new sectors which includes:
| ● | Fully licensing SAFE Management LLC as a Registered Investment Advisor and Commodities Trading Advisor. This was done so SAFE Management could offer fully managed trading services to individuals who lacked the time to trade for themselves and provide reasonable advisory fees and minimum investment amounts to service individuals who do not meet the requirements of Qualified Investors. | |
| ● | We acquired the assets of United Games LLC and United League LLC which provided us highly experienced management, programmers, marketing and compliance personnel along with key technology components such as a fully coded back office and trademarked FIREFAN app. We are still in the process of adapting their technology to Kuvera operations and working on various distribution plans for FIREFAN. | |
| ● | We changed the name of our subsidiary WealthGen Global, which was an unused entity, to SAFETek LLC in preparation for our entry into the high-performance computing space to meet the needs of 4IR (Fourth Industrial Revolution) business needs which includes mining, blockchain technologies, gaming, artificial intelligence and 3-Dimensional rendering. This will enable us to provide HPC services to small, medium and startup entities who require specialized high-speed processing but cannot afford the infrastructure. By leasing our processing to these companies, we will aid these entities in bringing their products, inventions, improvements to market. | |
| ● | We have designed a program through Joint Venture known as APEX which enables individuals to purchase highly customized processing cards which SAFETek will lease from the purchasers for a fixed period of time at a fixed monthly lease payment. This enables individuals to participate in emerging growth without experiencing the volatility and potential loss experienced in the sector. |
These companies provide Investview a stake in 4IR, HPC, app development, fintech, blockchain and personal money management sectors. Each of these are areas that are targeted for significant growth spurred by innovations through technology.
While our liabilities are larger than our assets it is important to note that we seek to keep operating expenses low. The assets we have acquired and will continue to seek out are those of technology, mobile apps, and human resources. These assets are not easily defined on our balance sheet but represent our ability to carry out our objectives which we believe will ultimately generating positive cash flow, reduced debt and then profitability.
Further, while we have reported reoccurring losses and have an operating capital deficiency, we have been able to establish multiple companies to create various revenue streams as we move forward. Our largest challenge is operational cash flow as lending arrangements continue to be expensive causing us to deploy incoming cash to prior debt. We believecontinue to seek short term capital in arrangements that are partnership based with elements of debt and equity combined. Additionally, our immediate focus is the adjustments initiated will reduce the payout slowly over a three-month period with payout percentages closer 60%.
Accordingly, the accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate our continuation as a going concern and the realization of assets and satisfaction of liabilities in the normal course of business. The carrying amounts of assets and liabilities presented in the financial statements do not necessarily purport to represent realizable or settlement values. The financial statements do not include any adjustment that might result from the outcome of this uncertainty.
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
NOTE 5 – REVERSE ACQUISITION
Reverse Acquisition with Wealth Generators
Effective April 1, 2017, we entered into a Contribution Agreement with Wealth Generators, pursuant to which the Wealth Generators members agreed to contribute 100% of the outstanding securities of Wealth Generators in exchange for an aggregate of 1,358,670,942 shares of our common stock. Following the closing, Wealth Generators became our wholly owned subsidiary and the Wealth Generators members became our stockholders and control the majority of our outstanding common stock.
The transaction was accounted for as a reverse acquisition using the acquisition method of accounting in accordance with FASB ASC Topic 805. Wealth Generators is the acquirer solely for financial accounting purposes. The following table summarizes the purchase accounting for the fair value of the assets acquired and liabilities assumed at the date of the reverse acquisition.
| Cash | $ | 3,550 | ||
| Receivables | 150,000 | |||
| Total assets acquired | 153,550 | |||
| Accounts payable and accrued liabilities | 456,599 | |||
| Due to former management | 127,199 | |||
| Debt | 26,314 | |||
| Total liabilities assumed [1] | 610,112 | |||
| Net liabilities assumed | 456,562 | |||
| Consideration [2] | 662,047 | |||
| Goodwill | $ | 1,118,609 |
Acquisition of United Games, LLC and United League, LLC
On July 20, 2018, we entered into a Purchase Agreement with United Games Marketing LLC, a Utah limited liability company, to purchase its wholly owned subsidiaries United Games, LLC and United League, LLC for 50,000,000 shares of our common stockstock. United Games, LLC and United League, LLC provide distributor marketing back-office and commission tools and online sports gaming experience for users of their applications distributed through their networks of affiliates therefore we expect significant synergies to Alpha Pro Asset Management Group, LLC (“Alpha Pro”), an entity affiliatedexist as a result of combining operations.
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
The transaction was accounted for as a business combination using the acquisition method of accounting in accordance with the prior members of management, in exchangeFASB (ASC Topic 805). The following table summarizes the purchase accounting for Alpha Pro’s assumption of $482,588 in liabilities. Accordingly, the shares issued for debt were accounted for the moment before the reverse acquisition, and the $482,588 in liabilities have been excluded from the total liabilities assumed shown here.
| Cash | $ | 3,740 | ||
| Receivables | 361,345 | |||
| Intangible assets (see Note 2) | 1,816,000 | |||
| Total assets acquired | 2,181,085 | |||
| Accounts payable and accrued liabilities | 409,803 | |||
| Total liabilities assumed | 409,803 | |||
| Net assets acquired | 1,771,282 | |||
| Consideration [1] | 800,000 | |||
| Gain on bargain purchase | $ | 971,282 |
| [1] | The 50,000,000 shares of our common stock transferred as consideration in accordance with the Purchase Agreement was valued on July 20, 2018, the date of acquisition, based on the weighted equity fair value of $0.016 per share as determined by a third party valuation firm. |
United Games, LLC and United League, LLC recorded combined revenue of $1,331,542 and a combined net income of $26,059 since the July 20, 2018 acquisition date, which were outstanding immediately beforeincluded in our consolidated statement of operations for the transaction. Using the closing market price of $0.0044 per share onyear ended March 31, 2017, consideration was valued at $662,047
The table below represents the pro forma financial statementsrevenue and net income (loss) for the yearyears ended March 31, 2017,2019 and 2018, assuming the reverse acquisition had occurred on April 1, 2016,2017, pursuant to ASC Subtopic 805-10-50. The historical financial information has been derived from the audited financial statements of Wealth Generators as filed on June 30, 2017 in the Company’s Form 8K-A and the audited financial statements of INVU. The financial information has been adjusted to give pro forma effect to events that are directly attributable to the reverse merger, are factually supportable and, in the case of the pro forma statements of operations, have a recurring impact. The pro forma adjustments are based upon available information and assumptions that the Company believes are reasonable.
Wealth Generators, LLC | Investview, Inc. | Adjustments | Consolidated | ||
| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | $1,616 | $3,550 | $- | $5,166 | |
| Receivables | 444,610 | 150,000 | (162,430) | [1] | 432,180 |
| Short term advances | 10,000 | - | - | 10,000 | |
| Total current assets | 456,226 | 153,550 | (162,430) | 447,346 | |
| Fixed assets, net | 10,235 | - | - | 10,235 | |
| Other assets: | |||||
| Deposits | 6,000 | - | - | 6,000 | |
| Goodwill | - | - | 1,118,609 | [3] | - |
(1,118,609) | [4] | ||||
| Total other assets | 6,000 | - | - | 6,000 | |
| Total assets | $472,461 | $153,550 | $(162,430) | $463,581 | |
| LIABILITIES AND STOCKHOLDERS' DEFICIT | |||||
| Current liabilities: | |||||
| Accounts payable and accrued liabilities | $1,370,972 | $417,025 | $(162,430) | [1] | $1,385,010 |
(86,500) | [2] | ||||
(154,057) | [4] | ||||
| Deferred revenue | 433,298 | 5,807 | (5,807) | [4] | 433,298 |
| Related party payable | 805,895 | 132,199 | (5,000) | [2] | 805,895 |
(127,199) | [4] | ||||
| Settlement payable | - | 344,392 | (344,392) | [2] | - |
| Debt | 2,093,745 | 73,011 | (46,696) | [2] | 2,102,476 |
(17,583) | [4] | ||||
| Current liabilities of discontinued operations | - | 120,266 | (120,266) | [4] | - |
| Derivative liability, short term portion | - | 37,157 | (37,157) | [2] | - |
| Total current liabilities | 4,703,909 | 1,129,857 | (1,107,088) | 4,726,679 | |
| Long term liabilities | - | - | - | - | |
| Total liabilities | 4,703,909 | 1,129,857 | (1,107,088) | 4,726,679 | |
| Stockholders’ deficit: | |||||
| Preferred stock | - | - | - | - | |
| Common stock | - | 125,889 | 24,576 | [2] | 1,509,136 |
1,358,671 | [3] | ||||
| Additional paid in capital | - | 97,774,514 | 83,558 | [2] | (1,250,112) |
(99,108,184) | [3] | ||||
| Treasury stock | - | (8,589) | - | (8,589) | |
| Members’ deficit | (4,231,449) | - | 4,231,449 | [5] | - |
| Accumulated deficit | - | (98,868,122) | 411,612 | [2] | (4,513,534) |
98,868,122 | [3] | ||||
(693,697) | [4] | ||||
(4,231,449) | [5] | ||||
| Total stockholders’ deficit | (4,231,449) | (976,307) | 944,657 | 4,263,099 | |
| Total liabilities and stockholders’ deficit | $472,461 | $153,550 | $(162,430) | $463,580 |
Wealth Generators, LLC | Investview, Inc. | Adjustments | Consolidated | ||
| Revenue, net | $12,872,947 | $131,465 | $(131,465) | [4] | $12,872,947 |
| Operating costs and expenses: | |||||
| Cost of sales | 862,849 | 3,257 | (3,257) | [4] | 862,849 |
| Commissions | 9,412,655 | - | - | 9,412,655 | |
| Selling and marketing | 500,032 | - | - | 500,032 | |
| Salary and related | 1,918,199 | - | - | 1,918,199 | |
| Professional fees | 917,308 | - | - | 917,308 | |
| General and administrative | 1,199,564 | 980,579 | (779,611) | [4] | 1,400,532 |
| Total operating costs and expenses | 14,810,607 | 983,836 | (782,869) | 15,011,575 | |
| Net loss from operations | (1,937,660) | (852,371) | 651,404 | (2,138,627) | |
| Other income (expense): | |||||
| Interest expense, related parties | (274,057) | - | - | (274,057) | |
| Interest expense | (205,327) | (648,573) | - | (839,525) | |
| Other income (expense) | (6,120) | - | - | (6,120) | |
| Gain (loss) on change in fair value of derivative liabilities | - | 84,284 | - | 84,284 | |
| Gain (loss) on debt extinguishment | - | 3,170,326 | 411,612 | [2] | 3,581,938 |
| Total other income (expense) | (485,504) | 2,606,038 | 411,612 | 2,532,145 | |
| Loss from operations before taxes | (2,423,164) | 1,753,666 | 1,063,015 | 393,518 | |
| Tax expense | (4,039) | - | - | (4,039) | |
| Net loss | $(2,427,203) | $1,753,666 | $1,063,015 | $389,479 |
| Year Ended March 31, | ||||||||
| 2019 | 2018 | |||||||
| Revenues | $ | 27,961,351 | $ | 19,416,537 | ||||
| Net (loss) | $ | (5,288,735 | ) | $ | (16,371,058 | ) | ||
| Loss per common share | $ | (0.00 | ) | $ | (0.01 | ) | ||
NOTE 6 – RELATED PARTY TRANSACTIONS
Our related party payables consisted of the following:
Year Ended March 31, | ||
2018 | 2017 | |
| Short term advances [1] | $1,880 | $100,000 |
| Revenue-based funding agreement entered into on 11/8/15 [2] | - | 180,000 |
| Short-term promissory note entered into on 9/13/16 [3] | - | 150,000 |
| Promissory note entered into on 11/15/16 [4] | - | 895 |
| Promissory note entered into on 3/15/17 [5] | - | 375,000 |
$1,880 | $805,895 | |
| Year Ended March 31, | ||||||||
| 2019 | 2018 | |||||||
| Short-term advances [1] | $ | 440,489 | $ | 1,880 | ||||
| Short-term promissory note entered into on 8/17/18 [2] | 105,000 | - | ||||||
| $ | 545,489 | $ | 1,880 | |||||
| [1] | We periodically receive advances for operating funds from our current majority shareholders (former members of Wealth Generators prior to the reverse acquisition) and other related parties, including entities that are owned, controlled, or influenced by our owners or management. These advances are due on demand, generally have no set interest rates associated with them, and are unsecured. During the year ended March 31, 2019, we received $1,805,777 in cash proceeds from advances, incurred $15,000 in interest, and repaid related parties a total of $1,382,168. | |
| [2] | A member of the senior management team advanced funds of $100,000 on August 17, 2018, under a short-term promissory note due to be repaid on August 31, 2018. On August 31, 2018 the note was amended to be due on demand or, in absence of a demand, due on August 31, 2019. The note had a fixed interest payment of $5,000, which was recorded as interest expense in the statement of operations during the year ended March 31, 2019. |
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
In addition to the reverse acquisition) and other related parties, including entities that are owned, controlled, or influenced by our owners or management. These advances are due on demand, generally have no set interest rates associated with them, and are unsecured. During the year ended March 31, 2018, we received $498,380 in cash proceeds from advances,
NOTE 7 – DEBT
Our debt consisted of the following:
Year Ended March 31, | ||
2018 | 2017 | |
| Revenue based funding arrangement entered into on 8/31/15 [1] | $- | $263,641 |
| Revenue share agreement entered into on 6/28/16 [2] | 195,245 | 525,000 |
| Purchase and sale agreement for future receivables entered into on 9/30/16 [3] | - | 220,652 |
| Short-term advance received on 1/11/17 [4] | 1,000,000 | |
| Short-term advance received on 3/16/17 [5] | - | 50,000 |
| Promissory note entered into on 3/31/17 [6] | - | 34,452 |
$195,245 | $2,093,745 | |
| Year Ended March 31, | ||||||||
| 2019 | 2018 | |||||||
| Revenue share agreement entered into on 6/28/16 [1] | $ | - | $ | 195,245 | ||||
| Short-term advance received on 8/31/18 [2] | 75,000 | - | ||||||
| Secured merchant agreement for future receivables entered into on 2/14/19 [3] | 641,687 | - | ||||||
| Secured merchant agreement for future receivables entered into on 2/14/19 [4] | 468,790 | - | ||||||
| Secured merchant agreements for future receivables entered into on 2/14/19 [5] | 597,060 | - | ||||||
| Promissory note entered into on 1/16/19 [6] | 60,000 | - | ||||||
| Secured merchant agreements for future receivables entered into on 3/28/19 [7] | 25,650 | - | ||||||
| Convertible promissory note entered into on 1/11/19 [8] | 26,600 | - | ||||||
| Convertible promissory note entered into on 2/6/19 [9] | 76,686 | - | ||||||
| Convertible promissory note entered into on 3/14/19 [10] | 5,557 | - | ||||||
| $ | 1,977,030 | $ | 195,245 | |||||
| [1] | During April 2016, we entered into a Royalty Agreement, which was replaced with a Revenue Share Agreement dated June 28, 2016, which was amended in October of 2016. Cash receipts were received of $100,000, $150,000, and $250,000 on April 19, May 11, and June 29, 2016, respectively. In accordance with the terms of the final amended agreement, we are required to make payments of $25,000 per month or a 3% royalty for the previous month’s sales, whichever is greater, beginning February 15, 2017, until the lender has been repaid $600,000. During the year ended March 31, 2019, we repaid $195,245. | |
| [2] | In August 2018, we received a $75,000 short-term advance. The advance is due on demand, has no interest rate, and is unsecured. | |
| [3] | During September 2018, we entered into a Secured Merchant Agreement for future receivables with an entity that provides quick access to working capital. On September 28, 2018, we received proceeds from this arrangement of $570,000. In accordance with the terms of the agreement, we were required to repay $839,400 by making ACH payments in the amount of 10% of our daily cash receipts. Accordingly, we recorded $269,400 as a debt discount at the inception of the agreement, which was the difference between the funds received and the amount that was to be repaid. In February 2019 we replaced this agreement with a new Secured Merchant Agreement (see below), therefore transferring $233,501 of amounts owed to a new agreement. However, prior to the terminating the September agreement, we made payments of $605,899 and amortized $269,400 into interest expense. | |
| During January 2019, we entered into a Secured Merchant Agreement for future receivables with an entity that provides quick access to working capital. On January 11, 2019, we received proceeds from this arrangement of $349,851. In accordance with the terms of the agreement, we were required to repay $489,650 by making daily ACH payments of $1,000 for the first 30 days following the date of the agreement and daily ACH payments of $2,999 thereafter. Accordingly, we recorded $139,799 as a debt discount at the inception of the agreement, which was the difference between the funds received and the amount that was to be repaid. In February 2019 we replaced this agreement with a new Secured Merchant Agreement (see below), therefore transferring $449,657 of amounts owed to a new agreement. However, prior to the terminating the January agreement, we made payments of $39,993 and amortized $139,799 into interest expense. | ||
| During February 2019, we entered into a Secured Merchant Agreement for future receivables with an entity that provides quick access to working capital. On February 15, 2019, we received proceeds from this arrangement of $73,801 after paying off $233,501 from a September 2018 agreement (see above) and $449,657 from a January 2019 agreement (see above). In accordance with the terms of the agreement, we are required to repay $909,350 by making daily ACH payments of $5,049. Accordingly, we recorded $152,391 as a debt discount at the inception of the agreement, which was the difference between the funds received plus the earlier debt paid off, and the amount that was to be repaid. During the year ended March 31, 2019, we repaid $141,372 and amortized $26,100 into interest expense. |
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018 we agreed to issue 10,000,000 shares of common stock to extinguish $263,641 in debt.
| [4] | During December 2018, we entered into a Secured Merchant Agreement for future receivables with an entity that provides quick access to working capital. On December 17, 2018, we received proceeds from this arrangement of $380,000. In accordance with the terms of the agreement, we were required to repay $559,600 by making daily ACH payments of $3,000. Accordingly, we recorded $179,600 as a debt discount at the inception of the agreement, which was the difference between the funds received and the amount that was to be repaid. In February 2019 we replaced this agreement with a new Secured Merchant Agreement (see below), therefore transferring $421,600 of amounts owed to a new agreement. However, prior to the terminating the December agreement, we made payments of $138,000 and amortized $179,600 into interest expense. | |
| During February 2019, we entered into a Secured Merchant Agreement for future receivables with an entity that provides quick access to working capital. On February 15, 2019, we received proceeds from this arrangement of $126,932 after paying off $421,600 from a December 2018 agreement (see above). In accordance with the terms of the agreement, we are required to repay $840,000 by making daily ACH payments of $4,649. Accordingly, we recorded $291,468 as a debt discount at the inception of the agreement, which was the difference between the funds received plus the earlier debt paid off, and the amount that was to be repaid. During the year ended March 31, 2019, we repaid $129,388 and amortized $49,646 into interest expense. | ||
| [5] | During October 2018, we entered into a Secured Merchant Agreement for future receivables with an entity that provides quick access to working capital. During October 2018, we received proceeds from this arrangement of $77,260. In accordance with the terms of the agreement, we were required to repay $699,500 by making daily ACH payments of $4,372. Accordingly, we recorded $224,500 as a debt discount at the inception of the agreement, which was the difference between the funds received and the amount that was to be repaid. In February 2019 we replaced this agreement with a new Secured Merchant Agreement (see below), therefore transferring $327,880 of amounts owed to a new agreement. However, prior to the terminating the October agreement, we made payments of $371,620 and amortized $224,500 into interest expense. | |
| During February 2019, we entered into a Secured Merchant Agreement for future receivables with an entity that provides quick access to working capital. On February 15, 2019, we received proceeds from this arrangement of $126,932 after paying off $327,880 from an October 2018 agreement (see above). In accordance with the terms of the agreement, we are required to repay $629,550 by making daily ACH payments of $3,498. Accordingly, we recorded $224,410 as a debt discount at the inception of the agreement, which was the difference between the funds received plus the earlier debt paid off, and the amount that was to be repaid. Also during February 2019, we entered into a second Secured Merchant Agreement with this same entity, receiving proceeds of $288,000. In accordance with the terms of the agreement, we are required to repay $419,700 by making daily ACH payments of $2,332. Accordingly, we recorded $131,700 as a debt discount at the inception of the agreement, which was the difference between the funds received and the amount that was to be repaid. During the year ended March 31, 2019, we repaid $157,410 on these two agreements and amortized $61,330 into interest expense. | ||
| [6] | In January 2019, we received funds of $631,617 and repaid $511,617 in a series of transactions representing short-term advances. On January 16, 2019, we entered into a short-term promissory note for the resulting $120,000 owed as a result of the transactions. The note had a zero percent interest rate and was due within the shorter of three months or the receipt of cash from a $1 million financing arrangement. Subsequent to January 16, 2019, we repaid $60,000 of the amount due under the note. | |
| [7] | During March 2019, we entered into a Secured Merchant Agreement for future receivables with an entity that provides quick access to working capital. On March 29, 2019, we received proceeds from this arrangement of $28,500. In accordance with the terms of the agreement, we were required to repay $45,000 by making daily ACH payments of $4,500. Accordingly, we recorded $16,500 as a debt discount at the inception of the agreement, which was the difference between the funds received and the amount that was to be repaid. During the year ended March 31, 2019, we repaid $4,500 and amortized $1,650 into interest expense. | |
| [8] | In January 2019, we entered into a Convertible Promissory Note and received proceeds of $135,000 after incurring loan fees of $3,000. The note incurs interest at 12% per annum and has a maturity date of April 11, 2020. The Convertible Promissory Note has a variable conversion rate that is 65% of the lowest closing price during the previous 15-trading-day period, subject to adjustment. Therefore, the conversion feature is accounted for as a derivative instrument (see Note 8). At inception, we recorded a debt discount of $138,000 and captured loan fees, recorded as interest expense, of $450,005. During the year ended March 31, 2019, we recorded amortization of the debt discount of $23,152 into interest expense and recorded additional interest expense on the note of $3,448. |
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018 we repaid $329,755.
| [9] | In February 2019, we entered into a Convertible Promissory Note and received proceeds of $240,000. The note was issued with a $30,000 original issue discount and loan fees of $3,000, incurs interest at 12% per annum, and has a maturity date of August 6, 2019. In accordance with the terms of the note, we issued 22,500,000 shares of common stock (the “Returnable Shares”) to the note holder as a commitment fee (see Note 9), provided, however, the Returnable Shares must be returned to us if the note is fully repaid and satisfied prior to the date which is 180 days following the issue date. The Convertible Promissory Note has a variable conversion rate that is 65% of the lowest trading price during the previous 20-trading-day period, subject to adjustment. Therefore, the conversion feature is accounted for as a derivative instrument (see Note 8). We allocated the proceeds of the note to the common stock issued and to the fair value of the note, taking into consideration the fair value of the conversion feature. As a result, the common stock was valued at $69,871, we recorded a debt discount of $270,000, and captured loan fees, recorded as interest expense, of $120,128. During the year ended March 31, 2019, we recorded amortization of the debt discount of $72,514 into interest expense and recorded additional interest expense on the note of $4,172. | |
| [10] | In March 2019, we entered into a Convertible Promissory Note and received proceeds of $135,000 after incurring loan fees of $3,000. The note incurs interest at 12% per annum and has a maturity date of June 14, 2020. The Convertible Promissory Note has a variable conversion rate that is 65% of the average of the two lowest closing prices during the previous 15-trading-day period, subject to adjustment. Therefore, the conversion feature is accounted for as a derivative instrument (see Note 8). At inception, we recorded a debt discount of $138,000 and captured loan fees, recorded as interest expense, of $64,492. During the year ended March 31, 2019, we recorded amortization of the debt discount of $4,831 into interest expense and recorded additional interest expense on the note of $726. |
In addition to the above debt transactions that were outstanding as of March 31, 20182019 and 2017,2018, during the year ended March 31, 2018,2019, we also received proceeds of $50,000 from short-term advances and $800,000$530,000 from short-term notes. During the year ended March 31, 2018,2019, we recorded interest expense of $65,000$51,000 for fixed interest amounts due on the notes entered into a Conversion Agreement to issue 5,000,000 shares of stock to extinguish the short-term advance of $50,000, and made total cash payments of $565,000$581,000 to extinguish the interest and principal amounts due on the notes. Also during
NOTE 8 – DERIVATIVE LIABILITY
During the year ended March 31, 2018,2019, we settled $250,000 of note principalhad the following activity in our derivative liability account:
| Derivative liability at March 31, 2018 | $ | - | ||
| Derivative liability recorded on new instruments | 1,144,525 | |||
| Change in fair value | 214,376 | |||
| Derivative liability at March 31, 2019 | $ | 1,358,901 |
We use the binomial option pricing model to estimate fair value for those instruments convertible into common stock, at inception, at conversion date, and $50,000 of interestat each reporting date. During the year ended March 31, 2019, the assumptions used in exchange for a distributor position and subscription, therefore,our binomial option pricing model were in the debt was written off to revenue.
| Risk free interest rate | 2.40% - 2.58 | % | ||
| Expected life in years | 0.35 - 1.25 | |||
| Expected volatility | 222% - 268 | % |
NOTE 89 – STOCKHOLDERS’ EQUITY
Preferred Stock
We are authorized to issue up to 10,000,000 shares of preferred stock with a par value of $0.001 and our Boardboard of Directorsdirectors has the authority to issue one or more classes of preferred stock with rights senior to those of common stock and to determine the rights, privileges, and inferencepreferences of that preferred stock, which has not yet been done. As of March 31, 20182019 and 20172018, we had no preferred stock issued or outstanding.
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
Common Stock Transactions
During the year ended March 31, 2019, we issued 50,000,000 shares of common stock for the acquisition of United Games, LLC and United League, LLC (see Note 5). We also issued 1,000,000 shares of common stock in August and 1,000,000 shares of common stock in March, valued at $10,000 and $17,600, respectively, based on the market price on the day of issuance, to an employee for compensation. The shares are subject to forfeiture if the employee is not in good standing six months after the date of issuance. During the year ended March 31, 2019, the $10,000 was recognized as expense and of the $17,600 we recognized $2,933 as an expense and $14,667 was recorded as a prepaid asset. Also during the year ended March 31, 2019, we issued 400,000,000 shares of common stock with a value of $6,760,000 based on the market price on the date of issuance, for an agreement to partner with a third party to generate future revenues. The 400,000,000 shares are subject to forfeiture for five years from the date of issuance, such that shares will be deemed earned upon meeting certain milestones. We are recognizing the expense ratably over the five-year term and recorded $96,307 in expense during the year ended March 31, 2019, while recording $6,663,693 as a prepaid asset as of March 31, 2019. During the year ended March 31, 2019, we entered into a common stock purchase agreement that provides cash of $1,000,000 in exchange for shares of our common stock. In conjunction with that agreement, we issued 3,000,000 shares of common stock that was accounted for as offering costs, increasing common stock by $3,000 and decreasing additional paid-in capital by $3,000, to offset any proceeds from the future equity transactions resulting from the agreement. During the year ended March 31, 2019, we issued 22,500,000 shares as a commitment fee in conjunction with a debt arrangement, whereby the shares were valued at $69,871 based on the allocation of debt proceeds (see Note 7). Also during the year ended March 31, 2019, we repurchased 7,000,000 shares of common stock for $91,000.
During the year ended March 31, 2018, we issued 267,127,500 shares of common stock for net proceeds of $2,495,338. We issued 125,000 shares of common stock with a value of $7,500 for a one-year consulting agreement, 80,000,000 shares of common stock with a value of $2,256,000 for a 15-year license agreement, and 94,250,333 shares of common stock with a value of $6,719,734 for consulting and service agreements; of the value of the shares issued for services and the license agreement $6,846,060 was recorded as expense, $3,555 was recorded as a prepaid asset, and $2,133,620 was recorded as a long-term license agreement during the year ended March 31, 2018. We also issued 239,575,884 shares of our common stock in settlement of debt, wherein accrued liabilities, principal, accrued interest, and derivative liabilities were extinguished in the amounts of $435,892, $2,348,606, $20,696, and $38,557, respectively, and we recognized a loss on the settlement of debt in the amount of $3,186,394 in the statement of operations for the year ended March 31, 2018. In conjunction with the shares issued for the settlement of debt, a gain of $413,012 related to the period prior to the reverse acquisition with Wealth Generators was excluded from the statement of operations. As a result of the reverse acquisition, we issued 1,358,670,942 shares of common stock (see Note 5). During the year ended March 31, 2018, we entered into an equity distribution agreement that provides for cash advances up to $5,000,000 in exchange for shares of our common stock, to be fulfilled at our request. Pursuant to that agreement, we issued 4,273,504 shares of common stock as a commitment fee, recorded a liability of $250,000 for future commitment fees to be paid, and paid cash of $15,000 for due diligence costs. As a result, common stock increased $4,274 and additional paid inpaid-in capital decreased by $269,274 to offset any proceeds from future equity transactions resulting from the agreement. During the year ended March 31, 2018, we cancelled 250,000 shares of common stock and 1,300 shares of treasury stock, resulting in a decrease in common stock of $251, a decrease in additional paid inpaid-in capital of $8,338, and a decrease in treasury stock of $8,589.
In conjunction with the sale of common stock during the year ended March 31, 2018, we provided a guarantee to certain individuals such that we would issue additional shares of our common stock if the average closing price of our common stock fell below $0.02 per share on the 20 days preceding the 18-month anniversary of the date the shares were originally sold. As a result of this guarantee, we havehad recorded $626,388 in accounts payable and accrued liabilities on our balance sheet as of March 31, 2018.
As of March 31, 20182019 and 2017,2018, we had 2,169,661,3182,640,161,318 and 125,889,4552,169,661,318 shares of common stock issued and 2,169,661,318 and 125,888,155 shares of common stock outstanding, respectively.
Employee Stock Options
The nonqualified plan adopted in 2007 authorizes 65,000 shares, of which 47,500 have been granted as of March 31, 2018.2019. The qualified plan adopted in October of 2008 authorizes 125,000 shares and was approved by a majority of our shareholders on September 16, 2009. As of March 31, 2018,2019, 42,500 shares have been granted under the 2008 plan.
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
The following table summarizes the changes in employee stock options outstanding and the related prices for the shares of our common stock issued to employees under two employee stock option plans:
Weighted | ||||
Weighted | Average | |||
Average | Remaining | Aggregate | ||
Number of | Exercise | Contractual | Intrinsic | |
Shares | Price | Life (years) | Value | |
| Options outstanding at March 31, 2016 | 37,500 | $10.20 | 3.33 | $- |
| Granted | - | $- | ||
| Exercised | - | $- | ||
| Canceled / expired | (2,500) | $12.00 | ||
| Options outstanding at March 31, 2017 | 35,000 | $10.00 | 2.51 | $- |
| Granted | - | $- | ||
| Exercised | - | $- | ||
| Canceled / expired | - | $- | ||
| Options outstanding at March 31, 2018 | 35,000 | $10.00 | 1.51 | $- |
| Options exercisable at March 31, 2018 | 35,000 | $10.00 | 1.51 | $- |
| Weighted | ||||||||||||||||
| Weighted | Average | |||||||||||||||
| Average | Remaining | Aggregate | ||||||||||||||
| Number of | Exercise | Contractual | Intrinsic | |||||||||||||
| Shares | Price | Life (years) | Value | |||||||||||||
| Options outstanding at March 31, 2017 | 35,000 | $ | 10.00 | 2.51 | $ | - | ||||||||||
| Granted | - | $ | - | |||||||||||||
| Exercised | - | $ | - | |||||||||||||
| Canceled / expired | - | $ | - | |||||||||||||
| Options outstanding at March 31, 2018 | 35,000 | $ | 10.00 | 1.51 | $ | - | ||||||||||
| Granted | - | $ | - | |||||||||||||
| Exercised | - | $ | - | |||||||||||||
| Canceled / expired | - | $ | - | |||||||||||||
| Options outstanding at March 31, 2019 | 35,000 | $ | 10.00 | 0.51 | $ | - | ||||||||||
| Options exercisable at March 31, 2019 | 35,000 | $ | 10.00 | 0.51 | $ | - | ||||||||||
Stock-based compensation expense in connection with options granted to employees for the year ended March 31, 20182019 and 20172018, was $0.
Weighted | ||||
Weighted | Average | |||
Average | Remaining | Aggregate | ||
Number of | Exercise | Contractual | Intrinsic | |
Shares | Price | Life (years) | Value | |
| Options outstanding at March 31, 2016 | 2,500 | $84.00 | 0.08 | $- |
| Granted | - | $- | ||
| Exercised | - | $- | ||
| Canceled / expired | (2,500) | $84.00 | ||
| Options outstanding at March 31, 2017 | - | $- | - | $- |
| Granted | - | $- | ||
| Exercised | - | $- | ||
| Canceled / expired | - | $- | ||
| Options outstanding at March 31, 2018 | - | $- | - | $- |
| Options exercisable at March 31, 2018 | - | $- | - | $- |
Warrants
The following table summarizes the warrants outstanding and the related prices for the shares of the Company’sour common stock as of March 31, 2018:
Warrants Outstanding | Warrants Exercisable | ||||
Weighted | |||||
Average | Weighted | Weighted | |||
Remaining | Average | Average | |||
Exercise | Number | Contractual | Exercise | Number | Exercise |
Price | Outstanding | Life (Years) | Price | Exercisable | Price |
$0.50 | 30,000 | 0.01 | $0.50 | 350,000 | $0.50 |
$1.50 | 6,127,497 | 1.24 | $1.50 | 6,127,497 | $1.50 |
$2.50 | 12,000 | 0.30 | $2.50 | 12,000 | $2.50 |
Total | 6,169,497 | 1.23 | $1.50 | 6,169,497 | $1.50 |
| Warrants Outstanding | Warrants Exercisable | |||||||||||||||||||||
| Weighted | ||||||||||||||||||||||
| Average | Weighted | Weighted | ||||||||||||||||||||
| Remaining | Average | Average | ||||||||||||||||||||
| Exercise | Number | Contractual | Exercise | Number | Exercise | |||||||||||||||||
| Price | Outstanding | Life (Years) | Price | Exercisable | Price | |||||||||||||||||
| $ | 1.50 | 5,052,497 | 0.36 | $ | 1.50 | 5,052,497 | $ | 1.50 | ||||||||||||||
Transactions involving the Company’sour warrant issuance are summarized as follows:
Weighted | ||
Number of | Average | |
Shares | Exercise Price | |
| Warrants outstanding at March 31, 2016 | 6,504,810 | $1.48 |
| Granted / restated | 30,000 | $0.50 |
| Canceled | - | $- |
| Expired | - | $- |
| Warrants outstanding at March 31, 2017 | 6,534,810 | $1.48 |
| Granted | - | $- |
| Canceled | - | $- |
| Expired | (365,313) | $(1.18) |
| Warrants outstanding at March 31, 2018 | 6,169,497 | $1.50 |
| Weighted | ||||||||
| Number of | Average | |||||||
| Shares | Exercise Price | |||||||
| Warrants outstanding at March 31, 2017 | 6,534,810 | $ | 1.48 | |||||
| Granted / restated | - | $ | - | |||||
| Canceled | - | $ | - | |||||
| Expired | (365,313 | ) | $ | (1.18 | ) | |||
| Warrants outstanding at March 31, 2018 | 6,169,497 | $ | 1.50 | |||||
| Granted | - | $ | - | |||||
| Canceled | - | $ | - | |||||
| Expired | (1,117,000 | ) | $ | (1.48 | ) | |||
| Warrants outstanding at March 31, 2019 | 5,052,497 | $ | 1.50 | |||||
NOTE 910 – COMMITMENTS AND CONTINGENCIES
Litigation
In the ordinary course of business, we may be or have been involved in legal proceedings from time to time. Below is a description of all legal proceedings we were involved in as ofduring the year ended March 31, 2018.
| ● | On November 1, 2017, we filed a lawsuit in the Fourth Judicial District Court for Utah County, State of Utah, Wealth Generators, LLC, v. Evan Cabral, Daniel Lopez, John Legarreta, Johnathan Lopez, Julian Kuschner, Nick Gomez, Luke Shulla, Nestor Velazquez, Christopher Terry, Isis De La Torre, Alex Morton, Ivan Briongos, Brandon Boyd, and International Markets Live Ltd. d/b/a iMarketslive, Civil No. 170401615, alleging corporate espionage and misappropriation of corporate information. The lawsuit alleges that International Markets Live Ltd., dba iMarketslive, conspired with a number of individuals affiliated with Wealth Generators to steal our confidential information, intellectual property, and trade secrets.On September 27, 2018, the court issued its ruling granting in part and denying in part our motion for preliminary injunction. On January 2, 2019, the parties entered into a settlement agreement in which they agreed to release all claims and have the litigation dismissed with prejudice, with neither party making any payment to the other, but with the defendants agreeing to make a $5,000 donation to charity. On |
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018 we received a subpoena from the United States Commodity Futures Trading Commission (“CFTC”). We complied with the terms of the subpoena and have negotiated a resolution of this matter with the CFTC staff. Under the proposed resolution, we will not admit or deny any of the allegations, will pay a fine of $150,000, and will agree not to act as an unregistered Commodities Trading Advisor in the future. We cannot provide any assurance that the resolution we have negotiated with the CFTC staff will be approved by the CFTC. We await the acceptance of the resolution from the CFTC.
| ● | In February 2018, we received a subpoena from the United States Commodity Futures Trading Commission (“CFTC”). We complied with the terms of the subpoena, negotiated a resolution of this matter with the CFTC staff, and a final order was issued on September 14, 2018. Under the order, we did not admit or deny any of the allegations, agreed to pay a fine of $150,000, and agreed not to act as an unregistered Commodities Trading Advisor in the future. As of March 31, 2019, we have paid $90,000 to CFTC and the remaining unpaid balance has been included in accounts payable and accrued liabilities on our consolidated balance sheet. | |
| ● | Jim Westphal filed a wage claim against Kuvera, LLC (at the time named Wealth Generators, LLC), in the United States District Court for the District of Utah, Central Division (Case No. 2:18-cv-00080) in the amount of $6,500 plus liquidated damages. Mr. Westphal is claiming unpaid overtime wages. We contend that Mr. Westphal was an independent contractor, hired on a limited basis to perform software services, and is accordingly not entitled to overtime payments under the Fair Labor Standards Act. Moreover, Mr. Westphal never provided the promised software pursuant to the parties’ agreement. We filed a counterclaim on July 12, 2018, seeking damages of approximately $20,000 and demanding a jury trial. In December 2018, the parties settled the matter with a joint motion. As a result of the settlement, we paid Mr. Westphal $1,500 and the case was dismissed. | |
| ● | In April of 2019, we received a Summons and Complaint from Fibernet Corp making claims of unpaid invoices and breach of contracts entered into in February 2012 and January 2015 as RazorData Corp. Without admitting fault or liability, in June of 2019, we entered into an agreement with Fibernet Corp to settle all claims and release us from any future claims in exchange for a payment of $35,160 to avoid ongoing litigation related to this matter. |
NOTE 1011 – INCOME TAXES
Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company used an effective tax rate of 30% when calculating the deferred tax assets and liabilities and income tax provision below.
Net deferred tax assets consist of the following components as of March 31, 20182019 and 2017:
Year Ended March 31, | ||
2018 | 2017 | |
| Deferred tax assets: | ||
| NOL carryover | $1,146,200 | $18,372,400 |
| Amortization | 335,600 | - |
| Contingent Liability | 45,000 | - |
| Related party accrued payroll | - | 2,200 |
| Deferred tax liabilities | ||
| Depreciation | (2,900) | - |
| Valuation allowance | (1,523,900) | (18,374,600) |
| Total long-term deferred income tax assets | $- | $- |
| 2019 | 2018 | |||||||
| Deferred tax assets: | ||||||||
| NOL carryover | $ | 2,363,900 | $ | 1,146,200 | ||||
| Amortization | 209,100 | 335,600 | ||||||
| Contingent Liability | 49,100 | 45,000 | ||||||
| Related party accruals | 1,500 | - | ||||||
| Deferred tax liabilities | ||||||||
| Depreciation | (1,200 | ) | (2,900 | ) | ||||
| Valuation allowance | (2,622,400 | ) | (1,523,900 | ) | ||||
| Total long-term deferred income tax assets | $ | - | $ | - | ||||
INVESTVIEW, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2019 AND 2018
The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income from continuing operations for the years ended March 31, 20182019 and 20172018, due to the following:
Year Ended March 31, | ||
2018 | 2017 | |
| Book income (loss) | $(4,473,900) | $754,100 |
| Stock for services | 2,048,200 | 239,800 |
| Gain on settlement – derivative and equity derived | 955,900 | (1,006,900) |
| Amortization | 313,200 | - |
| Contingent liability | 45,000 | - |
| Unrealized loss on cryptocurrency | 40,700 | - |
| Meals and entertainment | 6,200 | - |
| Non-cash interest expense | 5,700 | 387,400 |
| Depreciation | (2,800) | - |
| Related party accruals | (1,500) | (220,600) |
| Stock for payables | - | 278,000 |
| Gain on derivative liability | - | (36,200) |
| Fines and penalties | - | 3,900 |
| NOL utilization | - | (399,500) |
| Valuation allowance | 1,063,300 | - |
| Total long-term deferred income tax assets | $- | $- |
| 2019 | 2018 | |||||||
| Book income (loss) | $ | (1,493,400 | ) | $ | (4,473,900 | ) | ||
| Stock for services | 32,800 | 2,048,200 | ||||||
| Gain on settlement – derivative and equity derived | - | 955,900 | ||||||
| Amortization | (33,100 | ) | 313,200 | |||||
| Contingent liability | (45,000 | ) | 45,000 | |||||
| Unrealized loss on cryptocurrency | (31,900 | ) | 40,700 | |||||
| Meals and entertainment | 12,400 | 6,200 | ||||||
| Non-cash interest expense | 315,800 | 5,700 | ||||||
| Depreciation | (7,200 | ) | (2,800 | ) | ||||
| Related party accruals | 1,500 | (1,500 | ) | |||||
| Related party accrued payroll | 174,600 | - | ||||||
| Gain on bargain purchase | (291,400 | ) | - | |||||
| Loss on value of derivative liabilities | 64,300 | - | ||||||
| Stock issued for loan fees | 21,000 | - | ||||||
| Amortization of prepaid paid for with equity | 45,100 | - | ||||||
| Valuation allowance | 1,234,500 | 1,063,300 | ||||||
| Total long-term deferred income tax assets | $ | - | $ | - | ||||
At March 31, 2018, the Company2019, we had net operating loss carryforwards of approximately $3,821,000$7,880,000 that may be offset against future taxable income for the year 20192020 through 2038.2039. However, due to the change in ownership provisions of the Tax Reform Act of 1986, the NOL accumulated prior to the April 1, 2017, acquisition can only offset future income of up to $13,837 per year until expired. Should additional changes in ownership occur, net operating loss carryforwards in future years may be further limited.
No tax benefit from continuing or discontinued operations have been reported in the March 31, 20182019, consolidated financial statements since the potential tax benefit is offset by a valuation allowance of the same amount.
We comply with the provisions of FASB ASC 740 in accounting for itsour uncertain tax positions. ASC 740 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740, the Companywe may recognize the tax benefit from an uncertain tax position only if it is more likely that not that the
We recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The CompanyWe had no accruals for interest and tax penalties at March 31, 20182019 and 2017.
We do not expect the amount of unrecognized tax benefits to materially change within the next twelve12 months.
We are required to file income tax returns in the U.S. Federal jurisdiction, in New York State, New Jersey, and in Utah. The Company isWe are no longer subject to income tax examinations by tax authorities for tax years ending before March 31, 2014.
NOTE 1112 – SUBSEQUENT EVENTS
In April of 2019, we received proceeds of $200,000 from two separate short-term promissory notes.
In June 15,of 2019, we entered into an office lease agreement for our corporate finance department, located in Eatontown, New Jersey. The agreement is for a term of three years at a monthly rent amount of $2,500 for months one through six, $3,500 for months six through 12, and $4,000 for months 13 through 36. Corporate Finance is expected to occupy the new office space beginning in July of 2019.
In May and June of 2019, we issued an aggregate of 39,215,648 shares of our common stock to Triton Funds LP under the common stock purchase agreement that was entered into in December 2018 and amended in March and April 2019, for net proceeds of $325,000.
In accordance with ASC Topic 855, Subsequent Events, we completed state registration for SAFE Management LLC as a Registered Investment Advisorhave evaluated subsequent events through the date of this filing and await final approval from the State of New Jersey Bureau of Securities.