TWO RIVERS WATER & FARMING 10Q/A 2009 Q2 Quarterly report (amended)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

_________________

FORM 10Q – A#2

_________________

(Mark One)

[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2008

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from __________ to ___________

NAVIDEC FINANICAL SERVICES, INC.

_______________________________________________________

(Exact name of registrant as specified in its charter)

Colorado		000-51139		13-4228144
(State of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

2000 South Colorado Blvd., Suite 200, Denver, Colorado 80222

_______________________________________________

(Address of principal executive offices)

303-222-1000

__________________________

(Registrant's Telephone number)

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 past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to the filing requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated file, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ] Accelerated filer [ ]

Non-accelerated filer [ ] (Do not check if a smaller reporting company) Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes [ ] No [X]

Indicate the number of share outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

As of May 14, 2008, there were 9,024,583 shares of the registrant’s common stock issued and outstanding.

EXPLANATORY NOTE

This Form 10-Q/A#2 (the “Amendment”) amends our Form 10-Q/A for the period ended March 31, 2008, which was filed with the Securities and Exchange Commission on May 11, 2009 (the “Original Filing”). We are filing this Form 10-Q/A#2 to amend Item 1 “Financial Statements” and Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Specifically, during an internal review by the Company during May and June 2009, the Company became aware of its ownership of an additional 39,088 shares of BPZ Energy, Inc. common stock, which was estimated to have been acquired by the Company toward the end of 2006 as discussed in greater detail in Notes 2 and 5.

In connection with the filing of this Form 10-Q/A#2 and pursuant to Rules 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, we are including with this Form 10-Q/A#2 certain currently dated certifications.

This Amendment does not reflect events occurring after the Original Filing except as noted above. Except for the foregoing amended information, this Form 10-Q/A#2 continues to speak as of the date of the Original Filing and the Company has not otherwise updated disclosures contained therein or herein to reflect events that occurred at a later date.

Table of Contents

Item 1	Financial Statements (Unaudited)	Page
	Consolidated Balance Sheets March 31, 2008 and December 31, 2007	1
	Consolidated Statements of Operations Three months ended March 31, 2008 and 2007	2
	Consolidated Statements of Cash Flows Three months ended March 31, 2008 and 2007	3
	Consolidated Statement of Changes in Stockholders’ Equity – March 31, 2008	4
	Notes to Consolidated Financial Statements	5
Item 2	Management’s Discussion and Analysis of Financial Conditionand Results of Operations	22
Item 3	Quantitative and Qualitative Disclosures About Market Risk	25
Item 4	Controls and Procedures	26
Item 4T	Controls and Procedures	26
PART II – OTHER INFORMATION
Item 1	Legal Proceedings	28
Item 2	Changes in Securities	28
Item 3	Defaults Upon Senior Securities	28
Item 4	Submission of Matters to a Vote of Security Holders	28
Item 5	Other Information	28
Item 6	Exhibits	29
	SIGNATURES

PART I

ITEM 1. FINANCIAL STATEMENTS

NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

(In Thousands)

					March 31, 2008 Unaudited RESTATED	December 31, 2007 Audited RESTATED
ASSETS:
	Current Assets:
		Cash and cash equivalents			$ 3,162	$ 1,407
		S/T Mortgages receivable - Net of $169 allowance, deferred revenue of $77 on March 31, 2008 and $5 on December 31, 2007			2,524	2,148
		S/T Note receivable - Jaguar Group LLC Net of $39 imputed interest on March 31, 2008 and $54 on December 31, 2008			1,352	1,047
		Accrued interest receivable			27	45
		Advances receivable			1	5
		Prepaid expenses			40	62
	Total Current Assets				7,106	4,714
			Property, equipment and software, net		80	45
	Other Assets
		Notes receivable - (Note 4) - Aegis/Grizzle			483	450
		Investment - BPZ Energy - (Notes 2, 3, 5)			3,082	2,541
		Investment in Boston Property (Note 5)			1,530	1,279
		Real estate owned (Notes 2, 5)			640	379
		Other assets			6	15
			Total Other Assets		5,741	4,664
TOTAL ASSETS					$ 12,927	$ 9,423

LIABILITIES & STOCKHOLDERS' EQUITY:
	Current Liabilities:
		Accounts payable			$ 15	$ 15
		Short term borrowings (Note 7)			991	286
		Accrued taxes and liabilities			988	151
	Total Current Liabilities				1,994	452
	Minority Interest in Subsidiary (Note 1, 2)				3	3
				Total Liabilities	1,997	455
	Stockholders' Equity:
		Common stock, $0.001 par value, 100,000,000 shares authorized, 9,024,583 and 8,924,862 shares issued and outstanding at March 31, 2008 and December 31, 2007 respectively			9	9
		Additional paid-in capital			8,906	8,758
		Accumulated other comprehensive income (Note 2)			2,195	1,578
		Accumulated earnings / (deficit)			(180)	(1,377)
			Total Stockholders' Equity		10,930	8,968
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY					$ 12,927	$ 9,423

The accompanying notes to consolidated financial statements are an integral part of these statements.

Navidec Financial Services, Inc.

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NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES

Consolidated Statements of Operations

(In Thousands)

(Unaudited)

	For the Three Months Ended
	March 31, 2008 RESTATED	March 31, 2007 RESTATED
Revenue	$ 289	$ 224
Cost of fees including facilities and commissions	186	242
Gross Profit	103	(18)

Operating Expenses:
General and administrative	610	150
Impairment, depreciation and amortization	8	2
Total operating expenses	618	152
Loss from operations	(515)	(170)

Other income (expense)
Gain on sale of BPZ investment	2,487	64
Interest income	33	-
Interest (expense)	(31)	-
Other income (expense)	(64)	2
Total other income	2,425	66

Net Income (Loss) before minority interest and income tax	1,910	(104)

Minority Interest
Minority interest in consolidated subsidiary	-	(8)
Net Income (Loss) before taxes	1,910	(112)

Income Taxes
Provision for income tax	(713)	-
Net Income (Loss)	$ 1,197	$ (112)

Earnings Per Share:
Basic	$ 0.13	$ (0.01)

Weighted Average Shares Outstanding:
Basic	9,093	7,983

The accompanying notes to consolidated financial statements are an integral part of these statements.

Navidec Financial Services, Inc.

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NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES

Consolidated Statement of Cash Flows

(In Thousands)

(Unaudited)

			For the Three Months Ended
			March 31, 2008 RESTATED	March 31, 2007 RESTATED
Cash Flows from Operating Activities:
	Net Income (Loss)		$ 1,197	(112)
	Adjustments to reconcile net loss to net cash used in operating activities:
		Depreciation	8	2
		Gain on sale investments	(2,487)	(64)
		Increase in allowances and impairments	164	-
		Minority interest	-	8
	Changes in operating assets and liabilities:
		Accounts receivable	-	37
		Deferred Revenue	77	-
		Prepaid expenses and other assets	22	(10)
		Short term loans receivable	(878)	-
		Accrued interest and advances	15	-
		Accounts payable	-	(44)
		Accrued liabilities and other	560	(4)
Net Cash (Used in) Operating Activities			(1,322)	(187)

Cash Flows from Investing Activities:
	Investments (increased)/decreased
		Boston real estate	(251)	-
		Jaguar note receivable	(307)	-
		Marketable securities purchases	(1,074)	-
		Marketable securities sold	4,042	199
		BPZ legacy options exercised	-	362
	Increase in fixed assets		(43)	-
Net Cash Provided by Investing Activities			2,367	561

Cash Flows from Financing Activities:
	Increase in short term borrowings		705	-
	Option exercise proceeds		5	-
Net Cash Provided by Financing Activities			710	-
Net Increase in Cash & Cash Equivalents			1,755	374
Beginning Cash & Cash Equivalents			1,407	179
Ending Cash & Cash Equivalents			$ 3,162	553

Supplemental Disclosure of Cash Flow Information
	Non cash settlement of note receivable		$ 261	$ -
	Cash paid for Interest		$ 15	$ -
	Cash paid for Income Taxes		$ 103	$ -

The accompanying notes to consolidated financial statements are an integral part of these statements.

Navidec Financial Services, Inc.

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NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES

Consolidated Statement of Stockholders’ Equity

(Unaudited)

	For the Years Ended December 31, 2006 and 2007 and Three Months ended March 31, 2008
	(In thousands)
								Accumulated
		Voting				Additional		Other		Accumulated
		Common Stock				Paid-in		Comprehensive		Profit		Stockholder
		Shares		Amount		Capital		Income		(Deficit)		Equity

Balances, Dec 31, 2006, as previously reported		7,950	$	8		9,413		1,483		(3,973)		6,931
	Unrealized Gains	-		-		(1,203)		-		-		(1,203)
	Legal Settlement	-		-		-		-		295		295
Balance, December 31, 2006 (as restated)		7,950		8		8,210		1,483		(3,678)		6,023

Net income										2,301		2,301
	Options exercised	1,000		1		49		-		-		50
	Correct BPZ transaction	33		-		2		-		-		2
	Correct private placement	10		-		-		-		-		-
	Legacy Option Exercise	-		-		647		-		-		647
	Retirement of stock - Armijo settlement	(68)		-		(150)		-		-		(150)
	Gain on marketable securities	-		-		-		95		-		95
Balances, December 31, 2007		8,925		9		8,758		1,578		(1,377)		8,968

Net Income		-		-		-		-		1,197		1,197
	Options exercised	100		-		5		-		-		5
	Change in unrealized gains	-		-		-		172		-		172
	Lost BPZ stock (Notes 2, 4)	-		-		143		445		-		588
Balances, March 31, 2008		9,025	$	9	$	8,906	$	2,195	$	(180)	$	10,930

The accompanying notes to consolidated financial statements are an integral part of these statements.

Navidec Financial Services, Inc.

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NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2008 and 2007

(Unaudited)

NOTE 1 - ORGANIZATION

Navidec Financial Services, Inc. ("NFS" or "Company") was incorporated in December 2002, as a wholly owned subsidiary of Navidec Inc. ("Old Navidec"). In September 2004, Old Navidec consummated a reverse merger agreement with BPZ Energy, Inc. a Texas corporation established in 2001 ("BPZ") whereby Old Navidec transferred all of its asset, liabilities and historical operations into NFS and Old Navidec changed its name to BPZ Energy Inc. Also pursuant to the merger agreement, one share of NFS for one share of Old Navidec was spun off to the shareholders of record of Old Navidec.

NFS is now a holding company that is in the business of creating or acquiring a controlling interest in development stage enterprises with the expectation of further developing the enterprise and then taking the enterprise public.

On September 11, 2003, Old Navidec purchased an 80% interest in Northsight Mortgage Group, LLC ("NMG"), an Arizona mortgage broker. NFS received the 80% interest in NMG as part of the merger agreement with BPZ. On May 4, 2005, the Company formed Navidec Mortgage Holdings, Inc., a Colorado corporation ("NMH"), as a subsidiary of NFS and received 2,000,000 common shares of NMH. On November 11, 2007, NMH amended its articles of incorporation in order to change its name to Northsight, Inc. ("Northsight").

On October 12, 2007, NFS exchanged its 80% interest in NMG for 3,000,000 common shares of Northsight to bring the total common shares of Northsight owned by NFS to 5,000,000 shares. On October 12, 2007, Northsight then purchased the remaining 20% minority interest in NMG from the minority member for 100,000 shares of Northsight. As a result of this transaction, NFS owns 98% of Northsight and the former minority member of NMG owns 2% of Northsight.

Starting in July 2007, NFS began lending money to Northsight to enable Northsight to make short term, first deed of trust backed loans to borrowers who are purchasing deeply discounted or foreclosed residential real estate in Arizona and Colorado. During the year ended December 31, 2007, NFS had lent Northsight $5,826,473. The loans to Northsight yield 12% and are callable on demand by NFS. As of March 31, 2008, Northsight had approximately $3,062,000 in short term bridge loans outstanding. Short term bridge loans outstanding grew by 39% in the quarter ended March 31, 2008.

During the quarter ended March 31, 2008, we incurred an operating loss of $515,000. The Company sold 150,000 shares of BPZ Energy in the open market. This activity produced a onetime gain of $2,487,000. Other expenses over other income were $62,000 in net expenses.

Southie Development, LLC (Southie) was formed in January 2008 and is wholly-owned by Navidec. The purpose of Southie is to develop residential real estate for resale and to own and manage residential real estate acquired via default of real estate loans extended by Navidec. Once a real estate loan defaults and Navidec acquires the property, Navidec transfers the property to Southie for development and management. As part of that management and development, Southie may expend monies for rehabilitation of the property with the goal of renting or selling the property.

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Jaguar Group Investments, LLC

In February 2008, our subsidiary, Northsight entered into a joint venture agreement with Jaguar Group, LLC. Northsight purchased 50% equity and voting interest in Jaguar Investment Group, LLC and the remaining 50% is owned by Jaguar Group, LLC. Each equity interest was purchased for $4 million dollars, to be in the form of cash, real estate equity, and/or any form of consideration agreed by both members. At this time, the joint venture has not been fully funded.

The joint venture is to provide wholesale financing loan products to the real estate mortgage industry.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES INTERIM PRESENTATION

The unaudited consolidated financial statements and related notes for the three months ended March 31, 2008 and 2007, presented herein have been prepared by the management of NFS and its subsidiaries pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. Operating results for the three months ended March 31, 2008 are not necessarily indicative of the results that may be expected for the full year. It is suggested that these unaudited consolidated financial statements be read in conjunction with the December 31, 2007 audited consolidated financial statements.

In the opinion of management, all adjustments (consisting only of normal recurring adjustments), which are necessary for a fair presentation of operating results for the interim period presented have been made.

RESTATEMENT OF RESULTS

Subsequent to the issuance of the Company's audited financial statements for the year ended December 31, 2007, the Company determined that it would restate its financial statements for the year ended December 31, 2007 as contained in its Annual Report on Form 10KSBA, dated April 28, 2008 and the Form 10-Qs for the quarterly periods ended March 31, 2008, June 30, 2008 and September 30, 2008.

As a result of the revocation of the registration with the Public Accounting Oversight Board (PCAOB) of its previous auditors, Jaspers + Hall, PC, the Company was required to engage new PCAOB registered accountants and re-audit its 2007 Financial Statements.

During the re-audit, the Company determined that it had not used the proper cost in computing the gain on the sale of 980,000 BPZ Energy, Inc. (“BPZ”) common shares. The BPZ shares were acquired through warrants issued as a result of the reverse merger with BPZ and Navidec, Inc. and the Company had originally valued the warrants at $1.88 a share. The warrants had a strike price of $2.00 a share. Upon exercising the warrants and selling the shares, the Company had reported a cost of $2.00 in its 2007 financial statements. The Company should have used $3.88 a share, which is the original value of $1.88 a share plus the strike price of $2.00 a share. The Company incorrectly reduced the cost with a corresponding decrease to Additional Paid In Capital in 2007.

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As a result, the Company over stated its earnings from the sale of BPZ shares by $1,842,000 during the year ended December 31, 2007. In the restatement of the December 31, 2007 financial statements, the $1,842,000 was accounted for as Additional Paid In Capital, to correct the previous incorrect reduction in Additional Paid In Capital. The result from the change was a decrease in Retained earnings of $1,842,000 and an increase of $1,842,000 in Additional Paid In Capital. This correction resulted in no overall change in Stockholders’ Equity.

Due to using the incorrect BPZ cost, as of December 31, 2006 the BPZ asset and the corresponding unrealized gain on securities were overstated by approximately $900,000. Also in 2006, an additional 100,000 shares of BPZ were received by the Company via a default judgment received by the Company. A fair market value of approximately $300,000 was not recognized upon receipt, which amount would increase earnings in 2006 by $300,000. In addition, the Company had incorrectly recorded an increase of $1,200,000 to Additional Paid In Capital in 2005. The net impact on December 31, 2006 Stockholders’ Equity was an approximate $1,800,000 reduction.

Additionally, as of December 31, 2007, the BPZ asset and the corresponding unrealized gain on securities were overstated by approximately $810,000, due to failure to reduce unrealized gains by related deferred taxes. In addition, unrealized gains were understated by $240,000 due to the cost adjustment. The net impact on December 31, 2007 Shareholders’ Equity from this matter, exclusive of the tax considerations below, is an approximate $570,000 reduction. Since all of the remaining BPZ investment was sold in 2008, the unrealized BPZ gains were eliminated from the balance sheet along with the prior adjustments for unrealized gains.

The Company also corrected deferred revenue from mortgage origination and accrued expenses at December 31, 2007, that were previously recorded in 2008 of approximately $200,000. This correction resulted in a decrease of the Company’s 2007 income of $200,000; however, increased revenue and decrease expenses by the same amount for the year ended December 31, 2008.

Further, in May 2009, the Company’s accounting staff began a review of all of the Company’s ownership and transactions in BPZ Energy, Inc. common stock. During this internal review, the Company discovered that an additional 39,088 shares of BPZ were due from BPZ to the Company based on a past cashless exercise of Navidec legacy options. It is estimated that these shares were due to the Company toward the end of the year ended December 31, 2006, so the fair market value of the stock ($3.65 per share) for a total fair market value of $142,671 at December 31, 2006 is used for book basis. As of June 30, 2008, this increased the Investment in BPZ by $850,000, increased deferred tax liability by $262,000, and increased unrealized gain by $445,000.

No adjustment was made at December 31, 2007 and 2006 because the value of the additional 39,088 shares in BPZ at those dates was deemed to be immaterial. (Also see Note 4)

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March 31, 2008 Detail of Restated Balance Sheet

					March 31, 2008
					Previously Reported RESTATED	RESTATED	Change
ASSETS:
	Current Assets:
		Cash and cash equivalents			$ 3,162	$ 3,162	$ -
		Marketable securities			-	-	-
		S/T Mortgages receivable - Net of $169 reserve, deferred			2,524	2,524	-
			revenue of $77 on March 31, 2008 and $5 on December 31, 2007
		S/T Note receivable - Jaguar Group LLC			1,352	1,352	-
			Net of $39 imputed interest on March 31, 2008
			and $54 on December 31, 2008
		Accrued interest receivable			27	27	-
		Advances receivable			1	1	-
		Prepaid expenses			40	40	-
	Total Current Assets				7,106	7,106	-

			Property, equipment and software, net		80	80	-

	Other Assets
		Notes receivable			483	483	-
		Investment - BPZ Energy			2,232	3,082	850
		Investment in Boston Property			1,530	1,530	-
		Real estate owned			640	640	-
		Other assets			6	6	-
			Total Other Assets		4,891	5,741	850

TOTAL ASSETS					$ 12,077	$ 12,927	$ 850

LIABILITIES & STOCKHOLDERS' EQUITY:
	Current Liabilities:
		Accounts payable			$ 15	$ 15	$ -
		Short term borrowings			991	991	-
		Accrued taxes and liabilities			726	988	262
	Total Current Liabilities				1,732	1,994	262

	Minority Interest in Subsidiary				3	3	-
				Total Liabilities	1,735	1,997	262

	Stockholders' Equity:
		Common stock, $0.001 par value, 100,000,000 shares			9	9	-
			authorized, 9,024,583 and 8,924,862 shares issued
			and outstanding at March 31, 2008 and
			December 31, 2007 respectively
		Additional paid-in capital			8,763	8,906	143
		Accumulated other comprehensive income			1,750	2,195	445
		Accumulated earnings / (deficit)			(180)	(180)	-
			Total Stockholders' Equity		10,342	10,930	588

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY					$ 12,077	$ 12,927	$ 850

Navidec Financial Services, Inc.

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PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include the accounts of Navidec and its subsidiary, Northsight, Inc., and Northsight Mortgage formerly known as Navidec Mortgage Holdings, Inc. Navidec owns 98% of Northsight and the former minority member or Northsight Mortgage Group, LLC owns 2% of Northsight, Inc. As of December 31, 2007 Northsight, Inc. had a negative stockholders’ deficit, therefore, the consolidated financial statements do not include a provision for a liability for minority interest as of December 31, 2007. All significant inter-company balances and transactions have been eliminated in consolidation.

RECLASSIFICATION

Certain amounts previously reported have been reclassified to conform to current presentation. For the three months ended March 31, 2008 and March 31, 2007 certain facility related expenses, loan officer commissions and salaries, sales manager salaries and payroll overhead, and advertising costs were reclassified to the cost of loans.

USE OF ESTIMATES

The preparation of financial statements in conformity generally accepted accounting principles in the United States requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities, disclose of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ materially from those estimates.

CASH AND CASH EQUIVALENTS

For purposes of reporting cash flows; NFS considers cash and cash equivalents to include highly liquid investments with original maturities of 90 days or less. Those are readily convertible into cash and not subject to significant risk from fluctuations in interest rates. The recorded amounts for cash equivalents approximate fair value due to the short-term nature of these financial instruments.

CONCENTRATION OF CREDIT RISK

Financial instruments that potentially subject NFS to significant concentrations of credit risk include cash equivalents, notes receivable and trade accounts receivable. The Company maintains its cash and investment balances in the form of bank demand deposits, money market accounts, commercial papers and short-term notes with financial institutions that management believes to be of high credit quality. Accounts receivable are typically unsecured and are derived from transactions with and from customers primarily located in the United States.

As of March 31, 2008, the Company had $3,032,000 in a stock brokerage account, which SIPC insures up to $500,000, but is not insured by the FDIC. We had no more than $56,000 in any individual bank demand deposit, which is covered by FDIC insurance. As of December 31, 2007, the FDIC insurance covered each account up to $100,000, and all banks accounts were under the $100,000.

Management reviews accounts receivable periodically and reduces the carrying amount by a valuation allowance that reflects management's best estimate of amounts that may not be collectible. Allowances, if any, for uncollectible accounts receivable are determined based upon information available and historical experience. As of March 31, 2008, there was an allowance of $169,000 against a short term mortgage balance of $2,770,000. There was a $5,000 allowance at December 31, 2007 against a balance of $2,153,000.

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No sales to unaffiliated customers represented 10% or more of the Company’s revenue for the three months ended March 31, 2008.

NOTES RECEIVABLE

The Company carries its notes receivable at cost or loan balance, subject to the valuation procedures described below. The book value of these financial instruments is representative of their fair values. As of March 31, 2008 and December 31, 2007, the Company had a total of $2,524,000 and $2,148,000, respectively, invested in notes receivable, net of an allowance for bad debt of $169,000 and $5,000 respectively.

Interest is accrued monthly on notes receivable as earned and is no longer accrued if the loan becomes more than 90 days past due. The Company provides a valuation for certain loans that are delinquent. The valuation account is netted against notes receivable. As of March 31, 2008 and December 31, 2007, no loans were in excess of 90 days past due.

ALLOWANCE FOR BAD DEBT

NFS’s policy on allowances for bad debt determines the timing and recognition of expenses. The Company follows guidelines that allowance based off of historical and account specific trends; however, certain judgments affect the application of NFS bad debt allowance policy. NFS receivables are recorded net of an allowance for doubtful accounts which requires management to estimate amounts due which may not be collected. This estimate requires consideration of general economic conditions, overall historical trends related to the Company’s collection of receivables, customer specific payment history, and customer specific factors affecting their ability to pay amounts due. Management routinely assesses and revises its estimate of the allowance for doubtful accounts. As of year ended December 31, 2007, the Company had a $5,000 allowance for that debt. As of March 31, 2008 the Company had a $169,000 allowance against the short term mortgages.

IMPAIRMENT POLICY

Once per quarter, Navidec examines all of their assets for proper valuation and to determine if an allowance for impairment is necessary. In terms of real estate owned, this impairment examination also includes the accumulated depreciation. Management examines market valuations and if an additional impairment is necessary for lower of cost or market, then impairment is booked. Conversely, if Management determines the impairment to be excessive, then the impairment will be reduced. Each real estate property and note held is analyzed quarterly.

INVESTMENTS

Investments in publicly traded equity securities over which NFS does not exercise significant influence are recorded at market value in accordance with Financial Accounting Statement ("FAS") No. 115, "Accounting for Certain Investments in Debt and Equity Securities", which requires that all applicable investments be classified as trading securities, available for sale securities or held-to-maturity securities. The Company has investments treated as available-for-sale securities that are restricted from sale in the open market under Section 144 and have limited trading volume. There can be no assurance that we will realize the recorded value of this investment due to the size of the investment and its limited trading volume. Comprehensive income includes net income or loss and changes in equity from the market price variations in stock and warrants held by the Company. The Company’s comprehensive gain for the quarter ended March 31, 2008 was $2,487,000.

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Investments in non-publicly traded equity securities or non-marketable equity securities are stated at the lower of cost or estimated realizable value.

OTHER REAL ESTATE OWNED

Other real estate owned, at March 31, 2008, is comprised of real estate and other assets acquired through foreclosure, acceptance of a deed in lieu of foreclosure or otherwise acquired from the debtor in lieu of repayment of the debt. Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. Revenues, expenses and subsequent adjustments to fair value less estimated costs to sell are classified as expenses for other real estate owned.

Part 1—Real estate owned at end of period (in thousands)						Part 2—Rental income (in thousands)
Column A—List classification of property as indicated below	Column B—Amount of incumbrances	Column C—Initial cost to company	Column D—Cost of improve- ments, etc.	Column E—Amount at which carried at close of period	Column F—Reserve for depreciation and Impairments	Column G—Rents due and accrued at end of period	Column H—Total rental income applicable to period	Column I—Expended for interest, taxes, repairs and expenses	Column J—Net income applicable to period
Farms
Residential
Colorado	$ 250	282		282	-		2	2	-
Arizona		358		358	-			-	-
Massachusetts		1,200	330	1,530
Apartments and business
Unimproved
Total	$ 250	1,840	330	2,170	-		2	2	-
Rent from properties sold during period
Total	$ 250	1,840	330	2,170	-		2	2	-

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Real Estate Detail (in thousands)	Boston Property	Other Real Estate Owned	Total
Beginning Balance, January 1, 2008	$1,279	$379	$1,658
Additions during the period:
Acquisitions through foreclosure	-	261	261
Other acquisitions	-	-	-
Improvements, etc.	251	-	251
Other (describe)
Deductions during the period:
Cost of real estate sold	-	-	-
Impairments	-	-	-
Other (describe)	-	-	-
Ending Balance, March 31, 2008	$1,530	$640	$2,170

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed principally on the straight-line method over the estimated useful life of each type of asset which ranges from three to seven years. Leasehold improvements are amortized over the remaining term of the applicable leases or their useful lives, whichever is shorter. Maintenance and repairs are charged to expense as incurred; improvements and betterments are capitalized. Upon retirement or disposition, the related costs and accumulated depreciation are removed from the accounts, and any resulting gains or losses are credited or charged to income.

Below is a summary of property and equipment:

Asset Type	Life in Years	March 31, 2008	December 31, 2007
Office equipment & Furniture	5 – 7	$ 98,000	$ 91,000
Computers	3	39,000	24,000
Subtotal		137,000	115,000
Less Accumulated Depreciation		57,000	70,000
Net Book Value		$ 80,000	$ 45,000

GOODWILL AND INTANGIBLE ASSETS

NFS does not carry any intangible assets or goodwill on its books as of March 31, 2008.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying value of cash and cash equivalents, trade receivables and payables approximated their fair value because of their short-term nature. Investments in debt securities are recorded at their amortized cost, which approximates fair value because of their short-term maturity. Investments in marketable equity securities are recorded at fair value based upon quoted market prices. Investments in non-marketable equity securities are based upon recent sales of similar securities by the investees and approximated their carrying value. The Company's borrowings approximate their carrying amounts based upon interest rates currently available to the Company.

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REVENUE RECOGNITION

Interest Revenues

Revenues from interest are recorded at the time they are earned thus the revenues shown are for interest actually received and the accruals for that which is due to the Company. Interest revenues for the quarter ended March 31, 2008 were approximately $33,000.

Mortgage Revenues

The Company primarily recognizes its operating revenue through its subsidiary, Northsight, Inc., by charging origination fees from borrowers and earning interest and penalty fees on outstanding loan balances. Northsight recognizes fee and interest income on bridge, asset and conventional mortgage loans after mortgage loan transactions close.

Northsight acts as the mortgage broker and Navidec acts as the mortgage banker. Under FAS 65, Northsight is allowed to recognize the origination and associated fees in placing a loan when the loan is closed. However, since the statements are consolidated and Navidec is the mortgage banker, under FAS 91, Navidec, and the consolidated financial statements of Navidec, defers the revenue from the origination and associated fees over the expected life of the loan, which is usually 90 days.

Loan origination fees and other lender fees received by the Company are deferred and recognized as income over the life of the loan, which is normally 90 days. During the three months ended March 31, 2088 and the year ended December 31, 2007, the Company recognized income totaling $289,000 and $643,000, respectively from origination fees. At March 31, 2008, the Company had deferred revenue of $77,000, with no deferred revenue at December 31, 2007.

INCOME TAXES

Provision for income taxes represents actual or estimated amounts payable on tax return filings each year. Deferred tax assets and liabilities are recorded for the estimated future tax effects of temporary differences between the tax basis of assets and liabilities and amounts reported in the accompanying balance sheets, and for operating loss and tax credit carry forwards. The change in deferred tax assets and liabilities for the period measures the deferred tax provision or benefit for the period. Effects of changes in enacted tax laws on deferred tax assets and liabilities are reflected as adjustment to the tax provision or benefit in the period of enactment. NFS deferred tax assets have been reduced by a valuation allowance to the extent it was deemed more likely than not, that some or all of the deferred tax assets would not be realized.

At March 31, 2008, the Company had an accrued income tax liability of approximately $813,000 of which $551,000 is primarily related to profits generated on the sale of stock assets and $262,000 relates to the estimate of income taxes on the additional 39,088 shares of BPZ stock.

ACCRUALS

The Company follows the practice of paying all bills when received and therefore has not accrued any expenses.

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MARKETING AND ADVERTISING EXPENSES

For the three months ended March 31, 2008 and 2007, the Company incurred $33,000 and $10,000, respectively on advertising and marketing. The Company expenses these costs when incurred.

STOCK BASED COMPENSATION

Beginning January 1, 2006, the Company adopted the provisions of and accounts for stock-based compensation in accordance with Statement of Financial Accounting Standards (SFAS) No. 123 - revised 2004 (SFAS 123R), Share-Based Payment, which replaced SFAS No. 123 (SFAS 123), Accounting for Stock-based Compensation, and supersedes APB Opinion No. 25 (APB 25), Accounting for Stock Issued to Employees. Under the fair value recognition provisions of this statement, stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense on a straight-line basis over the requisite service period, which generally is the vesting period. The Company elected the modified-prospective method, under which prior periods are not revised for comparative purposes. The valuation provisions of SFAS 123R apply to new grants and to grants that were outstanding as of the effective date and are subsequently modified.

All options granted prior to the adoption of SFAS 123R and outstanding during the periods presented were fully-vested at the date of adoption.

NET INCOME (LOSS) PER SHARE

Basic net income (loss) per share is computed by dividing net income (loss) available to common shareholders for the period by the weighted average number of common shares outstanding for the period. Diluted net income (loss) per share is computed by dividing the net income (loss) for the period by the weighted average number of common and potential common shares outstanding during the period.

The dilutive effect of 3,841,510 options and 2,815,000 warrants at March 31, 2008, has not been included in the determination of diluted earnings per share since, under FAS-128R they would be anti-dilutive.

COMPREHENSIVE INCOME (LOSS)

Comprehensive income (loss) includes net income or loss and changes in equity from the market price variations in the BPZ stock help by the Company. During the quarter ended March 31, 2008, the unrealized gain from BPZ stock was $1,750,000.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities (SFAS No. 159). SFAS No. 159 permits entities to choose to measure, on an item-by-item basis, specified financial instruments and certain other items at fair value. Unrealized gains and losses on items for which the fair value option has been elected are required to be reported in earnings at each reporting date. SFAS No. 159 is effective for fiscal years beginning after November 15, 2007, the provisions of which are required to be applied prospectively. We believe that SFAS 159 should not have a material impact on our financial position or results of operations.

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In December 2007, the FASB issued SFAS No. 141 (Revised 2007), Business Combinations, or SFAS No. 141R. SFAS No. 141R will change the accounting for business combinations. Under SFAS No. 141R, an acquiring entity will be required to recognize all the assets acquired and liabilities assumed in a transaction at the acquisition-date fair value with limited exceptions. SFAS No. 141R will change the accounting treatment and disclosure for certain specific items in a business combination. SFAS No. 141R applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. Accordingly, any business combinations we engage in will be recorded and disclosed following existing GAAP until January 1, 2009. We expect SFAS No. 141R will have an impact on accounting for business combinations once adopted but the effect is dependent upon acquisitions at that time. We are still assessing the impact of this pronouncement.

In December 2007, the FASB issued SFAS No. 160, "Noncontrolling Interests in Consolidated Financial Statements--An Amendment of ARB No.51, or SFAS No. 160". SFAS No. 160 establishes new accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. SFAS No. 160 is effective for fiscal years beginning on or after December 15, 2008. We believe that SFAS 160 should not have a material impact on our financial position or results of operations.

In March 2008, the FASB issued SFAS No. 161 Disclosures about Derivative Instruments and Hedging Activities. SFAS No. 161 requires additional disclosure related to derivatives instruments and hedging activities. The provisions of SFAS No. 161 are effective as of January 1, 2008 and the Company is currently evaluating the impact of adoption.

NOTE 3 - INVESTMENT IN BPZ

Upon consummation of the merger transaction between Old Navidec and BPZ, BPZ issued 604,246 shares of its common stock to NFS. These shares were issued in consideration of NFS's assumption of all of the pre-merger business assets and liabilities of Old Navidec. These shares qualify as "marketable securities" as that term is defined by SFAS 115 (and as further defined in Footnote 2 to that Statement). Under this definition, if the equity security is restricted for sale by a governmental or other contractual requirement, but the holder of the security has the power to cause such requirement of restriction to be met in a manner that the security would reasonably be expected to qualify for sale within one year, the security is not considered restricted for the purposes of SFAS 115. As such, we are required to record our investment in these securities at their fair value.

At March 31, 2008, the closing market price per share of BPZ was $21.73 per share. The Company's "Investment – BPZ Energy," 150,000 shares, on March 31, 2008 was valued at $2,232,000 which represents a total value of $3,259,000 less an estimate of deferred tax of $1,207,000. On December 31, 2007, the Company held 300,000 shares of BPZ valued at $2,541,000, which represents a market value of $3,354,000 less estimate of deferred tax of $ 813,000.

We had the following proceeds from the sale of BPZ stock:

Year Ending	Proceeds
December 31, 2006	$ 893,000
December 31, 2007	$ 7,748,000
Three months ending March 31, 2008	$ 4,042,000

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NOTE 4 - NOTES RECEIVABLE

During the year ended December 31, 2007, the Company entered into a transaction with a former officer of the Company, Mr. Robert Grizzle. In exchange for Mr. Grizzle's shares in the Company, on May 3, 2007, Mr. Grizzle executed a note payable for $450,000. The note carries an 8% interest rate and is collateralized by 1,000,000 Aegis common shares, 1,500,000 Aegis preferred shares, 220,000 shares of the Company's common stock and 200,000 options to purchase shares of the Company’s common stock at $0.05 per share held by Mr. Grizzle. The note is a limited recourse note whereby Mr. Grizzle is personally responsible for one half the original principal and interest. The balance owed is secured by Mr. Grizzle's Aegis common and preferred shares and the Company's common stock. Further the note provides that at the earlier of one year from the date that the common stock of the Company is publicly traded and his shares are registered for resale under an effective registration statement filed by the Company or December 31, 2009. On September 30, 2007, Mr. Grizzle resigned as the Chief Operating Officer and the Chief Financial Officer of the Company.

In July 2007, Northsight, Inc. (formerly Navidec Mortgage Holdings, Inc.), a 98% owned subsidiary of the Company, began making short term loans to purchasers of residential properties who purchase their property as part of or after the repossession in a foreclosure proceeding. As of March 31, 2008, the Company had made $2,770,254 in such loans. The loans are made primarily to good credit borrowers and are secured by a first mortgage on the purchased properties. The average number of days outstanding for the loans is less than 90 days, and the primary takeout on the loans is long term financing through secondary sources such as the Federal National Mortgage Association.

On December 13, 2007, Northsight, Inc. (formerly Navidec Mortgage Holdings, Inc.) entered into a loan agreement with Welend Associated Group, LLC, a Colorado limited liability company and Jaguar Group, LLC, a Colorado limited liability company, each with joint and severable liability, in the amount of $1,100,000.This was increased by $391,000 during the quarter ended March 31, 2008. The note carries an interest rate of 0% and has a maturity date of six months from the date of the note. Security for the note is a first security interest in the debtor’s warehouse line of credit with Colorado State Bank. During February 2008, Northsight entered into a joint venture agreement with the Jaguar group. (See Note 1)

Summary of Receivables

Note From	Due	Principal Amount	3/31/08 Balance	Annual Interest rate	Accrued Interest	Collateral
Robert Grizzle	Oct 17, 2009	$450,000	$450,000	8%	$33,000	Shares and options in Navidec and Aegis
Welend-Jaguar	June 13, 2008	1,100,000	1,352,000	0%	$-0-	Junior security in residential mortgages
Short term home mortgages	Various and on-gong	2,693,000	2,770,000	9.95% to 14%	$28,000	First mortgage
Total			$4,572,000		$61,000
Less: Impairments			169,000
Less: Deferred Income			77,000
Net Balance			$4,326,000

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NOTE -5 – INVESTMENTS

In November of 2007, Northsight, Inc. (a 98% owned subsidiary of the Company) entered into a purchase agreement to acquire a three unit property in Boston, Massachusetts. The objective is to rehabilitate the property and then sell it. As of March 31, 2008 Northsight had invested a total of $1,530,000 in the property.

On December 20, 2007, the Company’s subsidiary, Northsight, Inc. repossessed a property with a value of $359,564 securing one of its short term loans due to non-payment. During the quarter ended March 31, 2008, the Company took back a second property with a value of $280,663 for non-payment. Both of these properties are held as inventory and may be held to rent or sold in the future. As of March 31, 2008 Management evaluated the fair market value of these properties and concluded that fair market value less the cost of sale is greater than the book value.

Originally it was reported that the Company held 150,000 shares of BPZ Energy, Inc. as of March 31, 2008. Based on trades executed on December 31, 2007, these shares have a market value of $2,232,000 (net of an estimate of deferred tax of $1,207,000).

In May 2009, the Company’s accounting staff began a review of all of the Company’s ownership and transactions in BPZ Energy, Inc. common stock. During this internal review, the Company found that 39,088 shares of BPZ were due from BPZ to the Company based on a past cashless exercise of Navidec legacy options. It is estimated that these shares were due the Company toward the end of 2006, so the fair market value of the stock was $143,000 ($3.65 per share) at December 31, 2006 and is used for book basis and the computation of unrealized and realized gains.

As of March 31, 2008, the 39,088 shares of BPZ had a market price of $21.73 per share for a total valuation of $850,000. The Company recognized $262,000 in deferred taxes on the unrealized gain and an unrealized gain of $445,000.

NOTE 6 - CAPITAL LEASES OBLIGATIONS

NFS acquired no property under capital lease arrangements during the quarters ended March 31, 2008 and 2007.

NOTE 7 - SHORT TERM BORROWINGS

During the quarter ended March 31, 2008, the Company's subsidiary Northsight, Inc. arranged for a bank line of credit. As of the end of the quarter, Northsight had drawn a total of approximately $156,000 against a total line of $3,000,000. The line of credit expires on August 10, 2008, carries interest at prime rate plus 1% per annum. It is collaterialzed by all current and future assignments of note and deeds of trust.

NOTE 8 – INFORMATION ON BUSINESS SEGMENTS

We organize our business segments based on the nature of the products and services offered. We operate in two principal business segments: venture capital formation and investment (Navidec parent company), and Mortgage Lending (Northsight, Inc.). All significant inter-company balances and transactions have been eliminated in consolidation.

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In the following tables of financial data, the total of the operating results of these business segments is reconciled, as appropriate, to the corresponding consolidated amount. Further there are some corporate expenses that were not allocated to the business segments, and these expenses are contained in the “Total Operating Expenses” under Navidec Financial Services.

Operating results for each of the segments of the Company are as follows:

	For the Three Months Ended						For the Three Months Ended
	March 31, 2008						March 31, 2007
	(Data in thousands)						(Data in thousands)
	Navidec Financial Services, Inc.			Northsight, Inc.			Navidec Financial Services, Inc.			Northsight, Inc.


Revenue
Sales	$	1		$	288		$	224		$	-
Cost of Sales		-			186			-			-
Gross Profit	$	1		$	102		$	224		$	-

Total Operating Expenses		234			384			394			-
Operating Income (Loss)	$	(233	)	$	(282	)	$	(170	)	$	-

Other Income/(Expense)
Gain on sale of investments		2,487			-			64			-
Other income/(expense)		(49	)		(13	)		2			-
Total Other Income/(Expense)	$	2,438		$	(13	)	$	66		$	-

Minority Interest		-			-			(8	)
Income Taxes (credit)		713			-			-			-
Net Income (Loss)	$	1,492		$	(295	)	$	(112	)	$	-

NOTE 9 – INCOME TAXES

During the three months ending March 31, 2008, the Company evaluated book versus tax. This analysis gave rise to a tax expense of $713,000 for the three months ended March 31, 2008, with $551,000 as a liability as of March 31, 2008.

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Statutory Rate Reconciliation

Federal Rate	34.00%
State Rate	4.63%
Federal benefit of State Rate	(1.57)%

Net Effective Rate	37.06%

Deferred Tax and Tax Liability Computation for 2008

	Federal (000s)
Book Income before taxes	$ 1,910

Tax Adjustments:
Additions (Permanent):
Entertainment exclusion	14
Projected Taxable Income	$ 1,924
Projected Tax	$ 713

NOTE 10 - EQUITY TRANSACTIONS COMMON STOCK

During the quarter ended March 31, 2008, a shareholder of the Company, exercised options at $0.05 per share for the purchase of 100,000 shares of the Company’s restricted common stock.

STOCK OPTIONS

During the quarter ended March 31, 2008, the Company did not issue shares of its common stock pursuant to the exercise of vested employee stock options.

During the quarter ended March 31, 2008, a shareholder of the Company exercised options exercisable for 100,000 shares of the Company's restricted common stock at $0.05 per share.

During the quarter ended March 31, 2008, no options expired.

At March 31, 2008, all outstanding and exercisable options were fully vested. The aggregate intrinsic value of outstanding fully-vested options as of March 31, 2008 was approximately $185,000.

A summary of the option plan is as follows:

	Shares	Weighted Average Exercise Price
Outstanding, January 1, 2008	3,681,510	$ 1.18
Granted	-	-
Cancelled	-	-
Expired	-	-
Exercised	(100,000)	-
Outstanding, March 31, 2008	3,581,510	$ 1.18
Options Exercisable , March 31, 2008	3,581,510	$ 1.18

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As of March 31, 2008, the future value of the existing stock options in Navidec is $4,226,000.

During the year ended December 31, 2007, the Company received $647,000 in proceeds from the exercise of BPZ legacy stock options. The agreement with BPZ provided that the Company would receive the strike price when the options are exercised.

WARRANTS

At March 31, 2008, the following warrants to purchase common stock were outstanding:

Number of common shares covered by warrants	Exercise Price	Expiration Date

1,332,500	$ 4.00	August 2010
1,332,500	$ 2.00	August 2010
150,000	$ 1.00	July 2010
2,815,000

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During the quarter ended March 31, 2008, the Company did not issue any warrants.

NOTE 11 - COMMITMENTS AND CONTINGENCIES

OPERATING LEASES

In February 2008, the Company along with its subsidiary, Northsight opened offices at 2000 S. Colorado Blvd, Suite 200, Denver, Colorado. The lease for this office is approximately $4,601 per month. The lease has a term of approximately 3 years.

DEFINED CONTRIBUTION PLAN

NFS has a 401(k) profit sharing plan (the "Plan"). Subject to limitations, eligible employees may make voluntary contributions to the Plan. The Company may, at its discretion, make additional contributions to the Plan. The Company did not contribute during the quarter ended March 31, 2008.

NOTE 12 – RELATED PARTIES

The Company rents part of the CEO’s private home for the CEO’s office for $3,500 per month. There is no long term commitment for this payment.

As of December 31, 2007, the Company advanced to the CEO $5,000 to cover pending expenses to be paid by the CEO on behalf of the Company. This advance was repaid in January 2008, when the CEO received his bonus payment.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with our unaudited financial statements and notes thereto included herein. In connection with, and because we desire to take advantage of, the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, we caution readers regarding certain forward looking statements in the following discussion and elsewhere in this report and in any other statement made by, or on our behalf, whether or not in future filings with the Securities and Exchange Commission. Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other developments. Forward looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward looking statements made by, or on our behalf. We disclaim any obligation to update forward-looking statements.

OVERVIEW

The Company is a holding company that is in the business of creating or acquiring a controlling interest in development stage enterprises with the expectation of further developing the enterprise and then taking the enterprise public.

The Company owns 98% of its subsidiary, Northsight, Inc. ("Northsight"). Northsight is focused on the Arizona (through its subsidiary Northsight Mortgages, LLC) and Colorado mortgage markets and is primarily engaged in the business of marketing and brokering mortgages secured by real estate with an emphasis on providing credit worthy individuals with interim financing for the purchase of repossessed or auctioned residential properties.

In February 2008, our subsidiary, Northsight entered into a joint venture agreement with Jaguar Group, LLC. Northsight purchased 50% equity and voting interest in Jaguar Investment Group, LLC ("Jaguar Investment Group") and the remaining 50% is owned by Jaguar Group, LLC. Each equity interest was purchased for $4 million dollars, to be in the form of cash, real estate equity, and/or any form of consideration agreed by both members. The joint venture is to provide whole sale financing loan products to the real estate mortgage industry.

RESULTS OF OPERATIONS

For the Three Months Ended March 31, 2008 compared to the Three Months Ended March 31, 2007

During the three months ended March 31, 2008, we recognized revenues of $289,000 from the activities of our subsidiary Northsight and its subsidiary Northsight Mortgage Group, LLC. The sales are a result of Northsight's originating residential mortgage loans. During the three months ended March 31, 2007, we recognized revenues of $224,000. The increase of $65,000 was a result of the development of a new bridge loan program that enables purchasers to acquire discounted residential real estate.

During the three months ended March 31, 2008, we incurred $186,000 in cost of revenues. During the period ended March 31, 2007, we incurred $242,000 in cost in revenues.

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During the three months ended March 31, 2008, we recognized a gross profit margin of $103,000 compared to a loss of $18,000 for the three months ended March 31, 2007. The increase of $121,000 was a result of a reducing our direct cost of revenues.

During the three months ended March 31, 2008, we incurred total operating expenses of $618,000 compared to $152,000 during the three months ended March 31, 2007. The increase of $466,000 is result of the expansion of Northsight’s mortgage operations to include an emphasis on short term bridge loans and the opening of Northsight's offices in Colorado and focus on the Colorado market. Further, we added $169,000 to our allowance against our short term mortgages. During the three months ended March 31, 2008, we incurred general and administrative expense of $610,000 compared to $150,000 during the three months ended March 31, 2007.

During the year ended March 31, 2008, we recognized net income of $1,197,000 compared to a loss of $112,000 during the three months ended March 31, 2007. The increase of $1,309,000 was principally due to the $2,487,000 gain on the sale of shares we hold in BPZ Energy. During the three months ended March 31, 2008, we sold 150,000 shares of BPZ for cash of approximately $4,042,000 in gross proceeds to expand Northsight’s mortgage operations, create our bridge loan product and increase our bridge loan portfolio.

LIQUIDITY

Net cash consumed by operating activities during the three months ended March 31, 2008 was $1,322,000, compared to net cash used in operating activities during the three months ended March 31, 2007 of $187,000. During the three months ended March 31, 2008, the net cash used by operations represented net income of $1,197,000, adjusted for the non-cash items of depreciation expense of $8,000, a gain on the sale of the BPZ investment of $2,487,000, increase of deferred revenue of $77,000, increase of prepaid expenses and other assets of $22,000, increase of accrued interest of $15,000 and $164,000 in allowances and impairments. We made investments of $681,000 into short term mortgage receivables. Income taxes and other payables increased by $560,000.

During the three months ended March 31, 2007, the net cash used in operating activities represented net loss of $112,000, adjusted certain non-cash items consisting of depreciation expense of $2,000, a gain on the sale of investments of $64,000, minority interest of $8,000, increase of accounts receivable of $37,000, and decrease of prepaid expenses, accounts payable and accrued liabilities of $58,000.

During the three months ended March 31, 2008, we generated $2,367,000 in cash in investing activities. We invested $43,000 in fixed assets, $251,000 in real estate in Boston, Massachusetts, received a net of $2,968,000 for our BPZ sales, and increased our investment in Jaguar by $307,000.

During the three months ended March 31, 2007, we received cash of $561,000 from our investment activities, consisting of $199,000 from the sale of equity investments and $362,000 due to the exercise of BPZ legacy options.

During the three months ended March 31, 2008, we generated $710,000 from our financing activities. We increased our short term borrowings by $705,000 and 100,000 options were exchanged for cash of $5,000. During the three months ended March 31, 2007, we did not receive any funds through our financing activities.

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At March 31, 2008, we had total current assets of $7,106,000, consisting of cash of $3,162,000, net mortgage receivables of $2,524,000, a note receivable of $1,352,000, accrued interest receivable of $27,000, prepaid expenses of $40,000 and an advance receivable of $1,000. At March 31, 2008, we had total current liabilities of $1,994,000, consisting of accounts payable of $15,000, short term borrowings of $991,000 and accrued taxes and liabilities of $988,000. Current assets exceed current liabilities by $5,112,000.

CRITICAL ACCOUNTING POLICIES

NFS has identified the policies below as critical to NFS business operations and the understanding of NFS results from operations. The impact and any associated risks related to these policies on the Company's business operations is discussed throughout Management's Discussion and Analysis of Financial Conditions and Results of Operations where such policies affect NFS reported and expected financial results. For a detailed discussion on the application of these and other accounting policies, see Note 2 in the Notes to the Consolidated Financial Statements beginning on page 6 of this document. Note that the Company's preparation of this document requires NFS to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of NFS financial statements, and the reported amounts of revenue and expenses during the reporting period. There can be no assurance that actual results will not differ from those estimates.

REVENUE RECOGNITION

NFS follows very specific and detailed guidelines in measuring revenue; however, certain judgments may affect the application of NFS revenue policy. Revenue results are difficult to predict, and any shortfall in revenue or delay in recognizing revenue could cause NFS operating results to vary significantly from quarter to quarter and could result in future operating losses.

REVENUES BUSINESS DEVELOPMENT SERVICES

Revenue from NFS business development services is generally derived from time and materials contracts and is recognized as the work is completed. Revenue recognition for time and materials contracts is not significantly impacted by judgments and estimates. Within the business development division a small amount of the work is performed based on fixed price agreements. When this occurs the projects are generally of a short duration and revenue is recognized when the project is completed.

REVENUES FROM MORTGAGE SERVICES

Revenues from mortgage brokerage operations are generally related to transaction-based fees and are recognized at the consummation of the transactions, generally when mortgage transactions close.

In July 2007 Navidec Mortgage Holdings, Inc., a wholly owned subsidiary of the Company, in conjunction with Northsight Mortgage, and 80% owned subsidiary of the Company began making short term loans to purchasers of residential properties who purchase their property as part of or after the repossession in a foreclosure proceeding. The loans are secured by first deeds of trust on residential real estate properties.

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ALLOWANCES FOR BAD DEBT

NFS's policy on allowances for bad debt determines the timing and recognition of expenses. The Company follows guidelines that allowance based off of historical and account specific trends; however, certain judgments affect the application of NFS bad debt allowance policy. NFS receivables are recorded net of an allowance for doubtful accounts which requires management to estimate amounts due which may not be collected. This estimate requires consideration of general economic conditions, overall historical trends related to the Company's collection of receivables, customer specific payment history, and customer specific factors affecting their ability to pay amounts due. Management routinely assesses and revises its estimate of the allowance for doubtful accounts. As of March 31, 2008, we had a $169,000 allowance for bad debt.

GOODWILL AND INTANGIBLE ASSETS

Intangible assets are amortized on a straight-line basis over their estimated useful lives. Goodwill is evaluated annually to determine if its value has been impaired. On September 11, 2003, Old Navidec entered into a purchase agreement with Northsight and its sole member that provided for the transfer of 80% of the issued and outstanding membership units of Northsight to Old Navidec resulting in the realization of $190,000 of goodwill. This membership interest was transferred to NFS pursuant to the terms of the merger agreement. Management determined that no Goodwill should be carried as an asset on its books and was written off in the year ended December 31, 2007.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

NFS is exposed to the impact of interest rate changes and change in the market values of the Company’s investments. Based on NFS's market risk sensitive instruments outstanding as of March 31, 2008, as described below, it has determined that there was no material market risk exposure to the Company's consolidated financial position, results of operations, or cash flows as of such date. NFS does not enter into derivatives or other financial instruments for trading or speculative purposes.

INTEREST RATE RISK - At March 31, 2008, the Company's exposure to market rate risk for changes in interest rates relates primarily to its mortgage services business. NFS has not used derivative financial instruments in its credit facilities. A hypothetical 10% increase in the Prime rate would not be significant to the Company's financial position, results of operations, or cash flows.

INVESTMENT RISK - In addition to the Company's investments in securities of BPZ, from time to time NFS has made investments in equity instruments in companies for business and strategic purposes. These investments, when held, are included in other long-term assets and are accounted for under the cost method since ownership is less than twenty percent (20%) and NFS does not assert significant influence.

INFLATION -- NFS does not believe that inflation will have a material impact on its future operations.

ITEM 3. QUANTATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Applicable

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ITEM 4. CONTROLS AND PROCEDURES

Disclosures Controls and Procedures

We have adopted and maintain disclosure controls and procedures (as such term is defined in Rules 13a 15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act, is recorded, processed, summarized and reported within the time periods required under the SEC's rules and forms and that the information is gathered and communicated to our management, including our Chief Executive Officer (Principal Executive Officer) and Principal Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure.

As required by SEC Rule 15d-15(b), Mr. McKowen our Chief Executive Officer and Principal Accounting Officer carried out an evaluation under the supervision and with the participation of our management, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 15d-14 as of the end of the period covered by this report. Based on the foregoing evaluation, Mr. McKowen has concluded that our disclosure controls and procedures are not effective in timely alerting them to material information required to be included in our periodic SEC filings and to ensure that information required to be disclosed in our periodic SEC filings is accumulated and communicated to our management, including our Chief Executive Officer, to allow timely decisions regarding required disclosure as a result of the deficiency in our internal control over financial reporting discussed below.

ITEM 4T. CONTROLS AND PROCEDURES

Management's Quarterly Report on Internal Control over Financial Reporting.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting for the company in accordance with as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:

(i)

pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

(ii)

provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made on in accordance with authorizations of our management and directors; and

(iii)

provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.

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Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

As a result of Management’s assessment of the effectiveness of the small business issuer’s internal control over financial reporting as of the year ended December 31, 2008, we believe that internal control over financial reporting has not been effective, and we are in the process of improving controls. We have identified certain material weaknesses of accounting relating to a shortage of qualified information technology, IT personnel and financial reporting personnel due to limited financial resources. This material weakness can lead to the following:

·	An inability to ensure there is timely analysis and review of accounting records, spreadsheets, and supporting data; and

·	an inability to effectively monitor access to, or maintain effective controls over changes to, certain financial application programs and related data.

Because of management’s discovery of such weaknesses as of December 31, 2008 and the resulting amendment of this quarterly report for the period ended March 31, 2008, Management has reassessed the effectiveness of the small business issuer’s internal control over financial reporting as of the quarter ended March 31, 2008, and has determined that that internal control over financial reporting at March 31, 2008 was not effective. Management has been in the process of improving controls. We have identified certain material weaknesses of accounting relating to a shortage of qualified information technology, IT personnel and financial reporting personnel due to limited financial resources.

Considering the nature and extent of our current operations and any risks or errors in financial reporting under current operations, the fact that we have been a small business with limited employees and that our Chief Financial Officer resigned in 2007 caused a weakness in internal controls involving the areas disclosed above.

We now have (subsequent to March 31, 2008), hired a full time in-house Certified Public Accountant and have taken the following steps:

we have authorized the addition of additional staff members to the finance department to ensure that there are sufficient resources within the department to prepare our financial statements and disclosures in accordance with accounting principles generally accepted in the United States of America; and

·	we are in the process of analyzing our processes for all business units and the establishment of formal policies and procedures with necessary segregation of duties, which will establish mitigating controls to compensate for the risk due to lack of segregation of duties.

This annual report does not include an attestation report of the company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only management's report in this annual report.

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There were no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2008 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

NONE

ITEM 2. CHANGES IN SECURITIES

During the quarter ended March 31, 2008, a shareholder of Company, exercised options with an exercise price of $0.05 per share for the purchase of 100,000 shares of the Company's restricted common stock.

Exemption From Registration Claimed

All of the sales by the Company of its unregistered securities were made by the Company in reliance upon Section 4(2) of the Securities Act of 1933, as amended (the "1933 Act"). All of the individuals and/or entities listed above that purchased the unregistered securities were almost all existing shareholders, all known to the Company and its management, through pre-existing business relationships, as long standing business associates, and employees. All purchasers were provided access to all material information, which they requested, and all information necessary to verify such information and were afforded access to management of the Company in connection with their purchases. All purchasers of the unregistered securities acquired such securities for investment and not with a view toward distribution, acknowledging such intent to the Company. All certificates or agreements representing such securities that were issued contained restrictive legends, prohibiting further transfer of the certificates or agreements representing such securities, without such securities either being first registered or otherwise exempt from registration in any further resale or disposition.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

NONE

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

NONE.

ITEM 5. OTHER INFORMATION

NONE.

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ITEM 6. EXHIBITS

Exhibits. The following is a complete list of exhibits filed as part of this Form 10-Q. Exhibit numbers correspond to the numbers in the Exhibit Table of Item 601 of Regulation S-K.

Exhibit 31 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act

Exhibit 32 Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act

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SIGNATURES

Pursuant to the requirements of Section 12 of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

NAVIDEC FINANCIAL SERVICES, INC.

(Registrant)

Dated: July 24, 2009

By: /s/ John McKowen

John McKowen, President & Chief Accounting Officer

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EXHIBIT 31

CERTIFICATION PURSUANT TO 18 U.S.C. ss. 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, John R. McKowen, certify that:

1. I have reviewed this quarterly report on Form 10-Q/A#2 of Navidec Financial Services, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function):

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a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls.

Dated: July 24, 2009

By: /s/ John McKowen

John McKowen, President & Chief Accounting Officer

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EXHIBIT 32

CERTIFICATION PURSUANT TO 18 U.S.C. 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Navidec Financial Service, Inc. on Form 10-Q/A#2 for the period ended March 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, John R. McKowen, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: July 24, 2009

By: /s/ John McKowen

John McKowen, President & Chief Accounting Officer

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TWO RIVERS WATER & FARMING (TURV) 10-Q/A2009 Q2 Quarterly report (amended)