UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
________________
FORM 10-K
(Mark One)
x | ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended June 30, 2009
or
o | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission file number: 000-15862
GVC VENTURE CORP.
(Exact Name of Registrant as Specified in its Charter)
Delaware | 13-3018466 |
(State or Other Jurisdiction of | (I.R.S. Employer Identification No.) |
The Chrysler Building, 405 Lexington Avenue, Suite 2600, New York, New York | 10174 | |
(Address of Principal Executive Offices) | (Zip Code) |
(212) 907-6610
(Registrant’s telephone number, including area code)
Securities registered under Section 12(b) of the Act: None
Securities registered under Section 12(g) of the Act: Common Stock, $.01 par value
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No x
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. Yes o No x
Indicate by check mark whether the issuer: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment of this Form 10-K. x
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company x
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes x No o
As of August 21, 2009, the aggregate market value of the registrant’s Common Stock held by non-affiliates of the issuer was approximately $54,655 based on the last sale price (the only available price on that date) of the issuer’s Common Stock, as reported by Bloomberg LP Investor Services. This amount excludes the market value all shares as to which any executive officer, director or person known to the registrant to be the beneficial owner of at least 5% of the registrant’s Common Stock may be deemed to have sole or shared voting power. This should not be construed as indicating that all such persons are affiliates.
The number of shares outstanding of the registrant’s Common Stock as at August 21, 2009 was 14,194,516.
DOCUMENTS INCORPORATED BY REFERENCE
None.
GVC VENTURE CORP.
FORM 10-K
TABLE OF CONTENTS
Page | ||
Forward-Looking Statements | 4 | |
Part I | ||
Item 1. | 4 | |
Item 1A. | 7 | |
Item 1B. | 7 | |
Item 2. | 7 | |
Item 3. | 7 | |
Item 4. | 7 | |
Part II | ||
Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. | 8 |
Item 6. | 9 | |
Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations. | 9 |
Item 7A. | 11 | |
Item 8. | 11 | |
Item 9. | Changes In and Disagreements With Accountants on Accounting and Financial Disclosure. | 24 |
Item 9A(T). | 24 | |
Item 9B. | 25 | |
Part III | ||
Item 10. | 25 | |
Item 11. | 27 | |
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. | 27 |
Item 13. | Certain Relationships and Related Transactions, and Director Independence. | 29 |
Item 14. | 30 | |
Part IV | ||
Item 15. | 31 | |
33 | ||
34 |
Certain statements in this Report are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this Report, words such as “may,” “should,” “seek,” “believe,” “expect,” “anticipate,” “estimate,” “project,” “plan,” “goal,” “intend,” “strategy” and similar expressions are intended to identify forward-looking statements regarding events, conditions and financial trends that may affect the Company’s future plans, operations, business strategies, operating results and financial position. Forward-looking statements are subject to a number of known and unknown risks and uncertainties that could cause the Company’s actual results, performance or achievements to differ materially from those described or implied in the forward-looking statements and its goals and strategies to not be achieved.
These risks and uncertainties, many of which are not within the Company’s control, include, but are not limited to:
• | the Company’s ability to find a candidate for, enter into an agreement with respect to, and consummate, a merger, acquisition or business combination or other financial transaction that is acceptable, both as to the candidate and as to transaction terms and conditions; |
• | competition for transactions of the nature the Company is seeking; |
• | potential future regulatory restrictions that could limit or pose restrictions on, or make less advantageous to potential candidates, transactions of the nature the Company is seeking; |
• | the availability of additional financing on satisfactory terms if a delay is encountered in consummating a transaction that the Company is seeking; and |
• | general economic and business conditions. |
You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this Report. The Company does not undertake any responsibility to publicly update or revise any forward-looking statement or report.
PART I
General
GVC Venture Corp (“GVC” or the “Company”) was incorporated under the laws of the State of Delaware on June 12, 1987. Its principal executive officers are located in The Chrysler Building, 405 Lexington Avenue, Suite 2600, New York, New York 10174 and its telephone number is
212-907-6610.
For several years, the Company has engaged in no operating activities, while seeking potential opportunities for an acquisition, sale, merger, including a reverse merger, or other business or financial transaction.
The Company plans to continue as a public entity and to actively seek merger (including a reverse merger), acquisition and business combination opportunities with operating businesses or other business or financial transactions, including with a privately-held company seeking to operate as a publicly-held company. However, there can be no assurance that this plan will be successfully implemented. While the Company is in discussions regarding a potential merger transaction at this time, the Company has no agreement or commitment with respect to the potential transaction and there can be no assurance that the transaction or any other merger, reverse merger, acquisition or other business combination will be successfully negotiated or completed. The Company has not, to date, set any specific criteria or models for any transaction. The Company believes it has sufficient working capital to continue its efforts for approximately one year.
Available Information
The Company files Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, files or furnishes Current Reports on Form 8-K, files or furnishes amendments to those reports, and may file proxy and information statements with the Securities and Exchange Commission (the “SEC”). These reports and statements may be read and copied at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, DC 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The Company has no website.
Strategy
The Company currently engages in no operating activities. The Company plans to continue as a public entity and to actively seek merger (including reverse merger), acquisition and business combination opportunities with operating businesses or other business or financial transactions, including with a privately-held company seeking to operate as a publicly-held company. However, there can be no assurance that this plan will be successfully implemented. The Company believes it has sufficient cash to continue its efforts for approximately one year. While the Company is in discussions regarding a potential merger transaction at this time, the Company has no agreement or commitment with respect to the potential transaction and there can be no assurance that the transaction or any other merger, acquisition or business combination will be successfully negotiated or completed or, if so, whether any such transaction will prove beneficial to the Company’s stockholders. The Company has not, to date, set any specific criteria or models for any such other transaction.
Opportunities come to GVC’s attention from various sources, including its management, its stockholders, professional advisors, securities broker-dealers, venture capitalists, members of the financial community and others who present unsolicited proposals. While it is not currently anticipated that the Company will engage unaffiliated professional firms, business consultants or finders specializing in business acquisitions, reorganizations or other such transactions to aid in the Company’s efforts, such firms may be retained if management deems it in the best interest of the Company. Compensation to a finder or business acquisition firm may take various forms, including one-time cash payments, payments involving the issuance of securities (including those of the Company), or any combination of these, or other compensation arrangements. Consequently, the Company is currently unable to predict the cost of utilizing such services.
The Company intends to continue its search for a suitable acquisition candidate without restricting its search to any particular business, industry or geographical location. In evaluating a prospective transaction, the Company will make a determination as to whether to proceed based on a composite of available facts, without reliance on any single factor, including the nature of the opportunity, andthe respective needs and desires of the Company.
Any such transaction would utilize a legal structure or method deemed by management to be suitable. Therefore, in implementing a structure and a particular transaction, the Company may become a party to a merger, “reverse merger,” consolidation, reorganization, tender offer, joint venture, license, purchase or sale of assets, purchase or sale of stock, or other arrangement. Additionally, the Company may act directly or indirectly through an interest in a partnership, corporation or other form of organization. Implementing such structure may require the merger, consolidation or reorganization of GVC with business organizations and there is no assurance that the Company would be the surviving entity. Any business combination is likely to result in a change in control of the Company and substantial dilution to the existing stockholders’ interest in the Company. As part of such a transaction, GVC’s existing directors may resign and new directors may be appointed. The Company’s operations following its consummation of a transaction will be dependent on the nature of the transaction. It is impossible to predict the nature of a transaction in which the Company may participate. There may also be risks inherent in the transaction, the nature and magnitude of which cannot be predicted.
The Company expects to incur losses each quarter until an appropriate transaction is effectuated.
Competition
GVC is in direct competition with many entities in its efforts to locate a suitable business combination or other financial transaction. Competitors include companies similar to the Company with a publicly-held stockholder base but with little or no business activities. Included in the competition for active companies are public and private operating companies, business development companies, special purpose acquisition companies, venture capital firms, small business investment companies, venture capital affiliates of industrial and financial companies, broker-dealers and investment bankers, merchant bankers, management consultant firms and private individual investors. Nearly all of these entities possess greater financial resources than GVC. Many of these competing entities also possess significantly greater experience and business contacts than GVC’s management.
Government Regulation
The Company is subject to the disclosure requirements of the SEC. In addition, certain provisions of the Sarbanes-Oxley Act of 2002 either are or, by June 30, 2010, may become, applicable to the Company, which could affect the willingness of companies to enter into a business combination with the Company. The SEC and other federal agencies and state legislatures could adopt rules or laws that restrict “reverse mergers” of a nature the Company may consider.
The Company also may be subject to increased governmental regulation following any business combination or other transaction the Company may consummate. It is impossible to predict the nature or magnitude of such regulation, if any.
Employees
The Company currently has no employees. Management of the Company uses, and expects to continue to use, consultants, attorneys and accountants as necessary. It is not expected that the Company will have any full-time or other employees, except as may result as a result of consummating a business combination or other transaction.
LEGAL PROCEEDINGS. |
Not applicable
UNRESOLVED STAFF COMMENTS. |
PROPERTIES |
The Company leases office space at The Chrysler Building, 405 Lexington Avenue, 26th Floor, New York, New York from an unaffiliated party under a month to month arrangement at a monthly rental of approximately $325.
LEGAL PROCEEDINGS. |
The Company is not aware of any legal proceeding that is pending against the Company or to which any of its property is the subject.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. |
Not applicable.
PART II
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. |
Price Range of Common Stock
The Company’s Common Stock is traded in the over-the-counter market and quoted under the symbol GPAX.OB through the OTC Bulletin Board System. The following are the high and low sales prices for the Company’s Common Stock for the periods reflected below, as reported by Bloomberg LP Investor Services:
Fiscal Year Ended June 30, 2008 | High | Low |
First Quarter | $.15 | $.11 |
Second Quarter | $.15 | $.09 |
Third Quarter | $.10 | $.09 |
Fourth Quarter | $.09 | $.08 |
|
|
|
Fiscal Year Ended June 30, 2009 | High | Low |
First Quarter | $.09 | $.08 |
Second Quarter | $.09 | $.03 |
Third Quarter | $.03 | $.03 |
Fourth Quarter | $.07 | $.02 |
The above prices reflect inter-dealer prices, without retail mark-up, mark-down or commissions and may not represent actual transactions.
Holders
The approximate number of stockholders of record of the Company’s Common Stock on August 21, 2009 was approximately 3,000. The Company estimates that, in addition, there are approximately 1,700 stockholders with shares held in “street name.”
Dividends
The Company has never paid any cash dividend, and it is anticipated that none will be paid in the foreseeable future.
Recent Sales of Unregistered Securities
The Company issued no shares of its capital stock during the year ended June 30, 2009.
Repurchases of Equity Securities
The Company did not repurchase any of its equity securities during the year ended June 30, 2009.
Not applicable.
The following discussion and analysis should be read in conjunction with Item 8, “Financial Statements and Supplementary Data” and the notes thereto included elsewhere in this Report. Historical operating results are not necessarily indicative of results that may occur in future periods. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including, but not limited to, those presented under “Forward-Looking Statements” preceding Item 1 and elsewhere in this Report. The Company undertakes no obligation to update any forward-looking statement to reflect events after the date of this Report.
Business
The Company currently engages in no operating activities. The Company plans to continue as a public entity and to actively seek merger (including reverse merger), acquisition and business combination opportunities with operating businesses or other business or financial transactions, including with a privately-held company seeking to operate as a publicly-held company. However, there can be no assurance that this plan will be successfully implemented. While the Company is in discussions regarding a potential merger transaction at this time, the Company has no agreement or commitment with respect to the potential transaction and there can be no assurance that the transaction or any other merger, reverse merger, acquisition or other business combination will be successfully negotiated or completed. The Company has not, to date, set any specific criteria or models for any transaction. The Company believes it has sufficient working capital to continue its efforts for approximately one year.
Unless and until a transaction is effectuated, the Company does not expect to have operations. Accordingly, during such period, the Company does not expect to achieve sufficient income to offset its operating expenses, resulting in operating losses that are expected to require the Company to use, and thereby reduce, its cash balance.
Results of Operations
Fiscal Year Ended June 30, 2009 compared to Fiscal Year Ended June 30, 2008
During the fiscal years ended June 30, 2009 and 2008, the Company engaged in no operating activities, while seeking potential opportunities for an acquisition, sale, merger, reverse merger, or other business transaction.
During the fiscal year ended June 30, 2009, the Company’s only revenues was nominal interest income and, during the fiscal year June 30, 2008, its only revenues was approximately $3,000 of interest income. The decrease in interest income in fiscal 2009 was a result of less funds being available for investment and a decrease in prevailing interest rates.
Corporate office and administrative expenses during each of the fiscal years ended June 30, 2009 and 2008 were $26,000 which, in both years, were primarily for rent, audit, legal, reporting and stockholder expenses.
The Company had a net loss of $27,000 in the fiscal year ended June 30, 2009 compared to a net loss of $24,000 in the fiscal year ended June 30, 2008. The increase in loss was due to the lower interest income earned in fiscal 2009.
Liquidity and Capital Resources
On June 30, 2009, the Company had cash of approximately $44,000 compared to approximately $61,000 at June 30, 2008. The decrease was a result of the net loss of the Company in the year ended June 30, 2009. While the Company’s liabilities at June 30, 2009 were $134,000, $126,000 thereof, owed to the Company’s law firm, remains subject to a payment deferral understanding.
The Company has no commitment for any capital expenditure. The Company’s cash requirements for the next twelve months are relatively modest, consisting principally of rent, legal, accounting and other expenses relating to filings required under the Securities Exchange Act of 1934 and expenses to be incurred in its search for a merger candidate or other business combination. The Company does not have any arrangements with banks or financial institutions with respect to the availability of financing in the future. The Company believes it has sufficient working capital to continue its efforts for approximately one year.
Off-Balance Sheet Arrangements
The Company has no off-balance sheet financing arrangements.
Recent Accounting Changes and New Accounting Pronouncements
See Note 1 of Notes to Financial Statements contained in Item 8 of this Report.
The only market risk that the Company is subject to is interest rates that pertain to the cash it maintains in bank accounts, including a money market account at a bank. For fiscal 2009, the Company earned nominal interest as it had less funds available for investment and prevailing interest rates declined on those investments to historically low levels.
The following financial statements of the Company are contained in this Report on the pages indicated:
To the Board of Directors and
Shareholders of GVC Venture Corp.
New York, New York
We have audited the accompanying balance sheet of GVC Venture Corp. (the Company) as of June 30, 2009 and June 30, 2008 and the related statements of operations, shareholders’ deficit, and cash flows for the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the 2009 and 2008 financial statements referred to above present fairly, in all material respects, the financial position of GVC Venture Corp. as of June 20, 2009 and June 30, 2008 and the results of its operations and cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations, and may require additional capital during fiscal 2010 to fund continuing operations. These items raise substantial doubt about the Company’s ability to continue as a going concern through June 30, 2010. Management’s plans in regards to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Braver P.C.
Certified Public Accountants
Providence, Rhode Island
August 28, 2009
GVC VENTURE CORP.
(Dollars in thousands)
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| June 30, | June 30, | ||||||
ASSETS |
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Current assets: |
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Cash and cash equivalents |
| $ | 44 |
| $ | 61 |
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Total current assets |
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| 44 |
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| 61 |
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Other assets |
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| 1 |
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| 1 |
| ||
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TOTAL ASSETS |
| $ | 45 |
| $ | 62 |
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LIABILITIES AND STOCKHOLDERS’ DEFICIT |
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Current liabilities: |
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Accounts payable and other accrued expenses |
| $ | 134 |
| $ | 124 |
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Total current liabilities |
|
| 134 |
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| 124 |
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TOTAL LIABILITIES |
|
| 134 |
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| 124 |
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Commitments and contingencies |
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Stockholders’ deficit: |
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Preferred stock, $.01 par value, authorized 1,000,000 shares, none issued or outstanding |
|
| - |
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| - |
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Common stock, $.01 par value, authorized 50,000,000 shares, issued and outstanding 14,194,516 shares |
|
| 142 |
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| 142 |
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Additional paid-in capital |
|
| 2,266 |
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| 2,266 |
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Accumulated deficit |
|
| (2,497 | ) |
| (2,470 | ) | ||
Total stockholders’ deficit |
|
| (89 | ) |
| (62 | ) | ||
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TOTAL LIABILITIES AND |
| $ | 45 |
| $ | 62 |
|
See Notes to Financial Statements
GVC VENTURE CORP.
(Dollars in thousands, except per share data)
|
| Years ended June 30, | ||||||
|
| 2009 | 2008 | |||||
Interest income |
| $ | - |
| $ | 3 |
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Expense: |
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Corporate office, legal, audit and administrative expenses |
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| 26 |
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| 26 |
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Total expense |
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| 26 |
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| 26 |
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Loss from operations |
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| (26 | ) |
| (23 | ) | |
Income tax expense |
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| 1 |
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| 1 |
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NET LOSS |
| $ | (27 | ) | $ | (24 | ) | |
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Basic and diluted loss per share |
| $ | - |
| $ | - |
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Weighted average common shares outstanding: |
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Basic and diluted |
| 14,194,516 |
| 14,194,516 |
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See Notes to Financial Statements.
GVC VENTURE CORP.
STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT
For the years ended June 30, 2009 and 2008
(Dollars in thousands, except share data)
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| Common Stock |
| Paid-in |
| Accumulated |
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| Shares |
| Amount |
| Capital |
| Deficit |
| Total |
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Balance, June 30, 2007 |
| 14,194,516 |
| $ | 142 |
| $ | 2,266 |
| $ | (2,446) |
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| $ | (38) |
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Net loss, year ended June 30, 2008 |
| - |
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| - |
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| - |
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| (24) |
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| (24) |
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| |||
Balance, June 30, 2008 |
| 14,194,516 |
| $ | 142 |
| $ | 2,266 |
| $ | (2,470) |
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| $ | (62) |
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Net loss, year ended June 30, 2009 |
| - |
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| - |
|
| - |
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| (27) |
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| (27) |
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| |||
Balance, June 30, 2009 |
| 14,194,516 |
| $ | 142 |
| $ | 2,266 |
| $ | (2,497) |
|
| $ | (89) |
|
|
See Notes to Financial Statements.
GVC VENTURE CORP.
STATEMENTS OF CASH FLOWS
(Dollars in thousands)
Years ended June 30, | |||||||||
2009 | 2008 | ||||||||
Cash Flows from Operating Activities: |
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Net loss |
| $ | (27 | ) | $ | (24 | ) | ||
Adjustments to reconcile net loss to cash provided by operating activities: |
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Increase/decrease in operating assets and liabilities: |
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Increase in accounts payable and accrued expenses |
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| 10 |
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| 6 |
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Net cash used in operating activities |
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| (17 | ) |
| (18 | ) | ||
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Cash Flows from Investing Activities: |
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| - |
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| - |
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Cash Flows from Financing Activities: |
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| - |
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| - |
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Net decrease in cash and cash equivalents |
|
| (17 | ) |
| (18 | ) | ||
Cash and cash equivalents, beginning of year |
|
| 61 |
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| 79 |
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Cash and cash equivalents, end of year |
| $ | 44 |
| $ | 61 |
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Supplemental cash flow disclosures: | |||||||||
Cash payments of interest |
| $ | - |
| $ | - |
| ||
Cash payments of income taxes |
| $ | 1 |
| $ | 1 |
|
See Notes to Financial Statements.
GVC VENTURE CORP.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Principles of Consolidation:
The accompanying financial statements of GVC Venture Corp. (the Company) have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP).
Nature of Operations:
The Company currently engages in no operating activities other than seeking potential opportunities for a merger (including reverse merger), acquisition, sale, or other business combination and other financial transactions. The Company currently engages in no operating activities. The Company has been actively seeking merger, acquisition and business combination opportunities with operating businesses and other appropriate financial transactions, including a transaction with a privately held company seeking to operate as a publicly-held company.
Going Concern:
The financial statements have been prepared assuming the Company will continue as a going concern. The Company had a net loss of $27,000 for the year ended June 30, 2009, and a net loss of $24,000 for the year ended June 30, 2008, and had also experienced losses in prior years which significantly weakened the Company’s financial condition and its potential inability to meet current operating expenses. In addition, the Company’s current liabilities exceeded its current assets by $90,000 at June 30, 2009 and $63,000 at June 30, 2008. The appropriateness of using the going concern basis is dependent upon, among other things, the Company’s ability to raise additional capital to fund operating losses and consummate a merger (including reverse merger), acquisition, sale, other business combination or other financial transactions. The uncertainty of obtaining these goals raises doubt about the Company’s ability to continue as a going concern through June 30, 2010. The financial statements do not include any adjustments to the carrying value of the assets and liabilities that might be necessary as a consequence of these uncertainties.
Cash and Cash Equivalents:
Highly liquid instruments purchased with original maturities of three months or less are considered to be cash equivalents.
The Company maintains cash balances at one financial institution. The Federal Deposit Insurance Corporation (FDIC) insures the account up to $250,000 and $100,000 at June 30, 2009 and 2008, respectively. At June 30, 2009 and 2008, all of the Company’s cash balances were FDIC insured except funds of $19,000 held in a money market fund at June 30, 2009 and $51,000 at June 30, 2008.
Estimates:
The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
Income Taxes:
The Company utilizes the asset and liability method of accounting for deferred income taxes as prescribed by the Statement of Financial Accounting Standards No. 109 (SFAS 109) “Accounting for Income Taxes.” This method requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between tax return and financial statement reporting bases of certain assets and liabilities.
Earnings Per Common Share:
Basic EPS is based on the weighted average number of common shares outstanding for the period, excluding the effects of any potentially dilutive securities. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted. Net income (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period.
Basic and diluted loss per common share was calculated using 14,194,516 shares for each of fiscal 2009 and 2008 as there were no stock issuances, or potentially dilutive securities outstanding in either year. Accordingly, basic and diluted shares were the same in each fiscal year.
Fair Value of Financial Instruments:
SFAS No. 107, “Fair Value of Financial Instruments”, requires disclosure of the fair value of financial instruments for which the determination of fair value is practicable. SFAS No. 107 defines the fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. The carrying amounts of the Company’s financial instruments (cash and cash equivalents) approximate their fair value because of the short maturity of these instruments.
Stock Based Compensation:
On December 16, 2004, the Financial Accounting Standards Board (“FASB”) issued FASB Statement No. 123 (revised 2004), “Share-Based Payment” (“SFAS 123(R”), which is a revision of FASB Statement No. 123, Accounting for Stock-Based Compensation. SFAS 123(R) requires expense for all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Pro forma disclosure is no longer an alternative. For the Company, this statement was effective as of April 1, 2006. The Company adopted the modified prospective method, under which compensation cost is recognized beginning with the effective date. The modified prospective method recognizes compensation cost based on the requirements of SFAS 123(R) for all share-based payments granted after the effective date and, based on the requirements of SFAS 123, for all awards granted to employees prior to the effective date that remain unvested on the effective date. The Company was not required to record any expenses under SFAS 123(R) for share based awards currently outstanding. However, the amount of expense recorded under SFAS 123(R) will depend upon the number of share based awards granted in the future and their valuation.
NOTE 2 – RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS:
On July 1, 2009, the Financial Accounting Standard Board (“FASB”) issued SFAS No. 168, “The FASB Accounting Standards Codification ™(Codification) and the Hierarchy of Generally Accepted Accounting Principles-a replacement of FASB Statement No. 162”, which will become the source of authoritative U.S. generally accepted accounting principles (GAAP) recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. On the effective date of this Statement, the Codification will supersede all then-existing non-SEC accounting and reporting standards. All other nongrandfathered, non-SEC accounting literature not included in the Codification will become nonauthoritative. This Statement is effective for financial statements issued for interim and annual periods ending after September 15, 2009. The Company is currently evaluating the impact of SFAS No. 168 on the Company’s financial statements.
In April 2009, the Financial Accounting Standard Board (“FASB”) issued FASB Staff Position (“FSP”) FAS 141(R)-1, “Accounting for Assets Acquired and Liabilities Assumed in a Business Combination That Aries from Contingencies” . FSP FAS 141(R)-1 amends and clarifies FASB Statement No. 141(R), “Business Combination”, to address application issues raised by preparers, auditors and members of the legal profession on initial recognition and measurement, subsequent measurement and accounting and disclosure of assets and liabilities arising from contingencies in a business combination. FSP FAS 141(R)-1 is effective for assets and liabilities arising from contingencies in 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. The adoption of this FAS did not have a material effect on the Company’s financial condition results of operation or cash flows.
In April 2009, the Financial Accounting Standards Board (“FASB”) issued FASB Staff Position (“FSP”) FAS 107-1 and APB 28-1, “Interim Disclosures about Fair Value of Financial Instruments (“FAS 107-1 and APB 28-1”), which amends SFAS No. 107, “Disclosures about Fair Value of Financial Instruments,” and APB opinion No. 28, “Interim Financial Reporting,” to require disclosures about fair value of financial instruments in interim as well as in annual financial statements. FSP FAS 107-1 and ABP 28-1 is effective for interim reporting periods ending after June 15, 2009, which for the Company is the first quarter of fiscal 2010. It is not believed that, based on the Company’s current corporate structure, FSP FAS 107-1 and ABP 28-1 will have an impact on the Company’s financial position, results of operations or cash flows.
In May 2008, the FASB issued Statement of Financial Accounting Standards (“SFAS”) No. 162, “The Hierarchy of Generally Accepted Accounting Principles”. SFAS No. 162 sets forth the level of authority to a given accounting pronouncement or document by category. Where there might be conflicting guidance between two categories, the more authoritative category will prevail. SFAS No. 162 became effective on November 15, 2008. SFAS No. 162 has had no effect on the Company’s financial position, statements of operations or cash flows.
In March 2008, the Financial Accounting Standards Board, or FASB, issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities”, an amendment of FASBStatement No. 133. This standard requires companies to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. This Statement will become effective as to the Company on July 1, 2009, with early application encouraged. The Company has not yet adopted the provisions of SFAS No. 161, but does not expect it to have a material impact on its financial position, results of operations or cash flows.
In December 2007, the Securities Exchange Commission (“SEC”) published Staff Accounting Bulletin (“SAB”) No. 100, which amends SAB No. 107 to allow for the continued use, under certain circumstances, of the “simplified” method in developing an estimate of the expected term of so-called “plain vanilla” stock options accounted for under SFAS 123(R) beyond December 31, 2007. Companies can use the simplified method if they conclude that their stock option exercise experience does not provide a reasonable basis upon which to estimate the expected term of stock options. We have no outstanding stock options and have not had exercised stock options.
In December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements”, an amendment of ARB No. 51. This statement amends ARB 51 to establish accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. It clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. Before this statement was issued, limited guidance existed for reporting noncontrolling interests. As a result, considerable diversity in practice existed. So-called minority interests were reported in the consolidated statement of financial position as liabilities or in the mezzanine section between liabilities and equity. This statement improves comparability by eliminating that diversity. The provisions of SFAS No. 159 are effective for the Company’s fiscal year beginning July 1, 2009. Earlier adoption is prohibited. It is not believed that, based on the Company’s current corporate structure, this will have an impact on the Company’s financial position, results of operations or cash flows.
In December 2007, the FASB issues SFAS No. 141(R), “Business Combinations,” which replaces SFAS No. 141, “Business Combinations,” that, among other things, establishes principles and requirements for how an acquirer entity recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed (including intangibles) and any noncontrolling interests in the acquired entity. SFAS No. 141(R) applies to the Company prospectively to business combinations for which the acquisition date is on or after July 1, 2009. The impact on the Company will depend on the nature and extent of any business combinations occurring on or after that date.
In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” including an amendment of FASB Statement No. 115 (SFAS 159), which permits entities to choose to measure many financial instruments and certain items at fair value. Unrealized gains and losses on items for which this option has been elected are reported in earnings. The provisions of SFAS No. 159 became effective for the Company on July 1, 2008 and has had no effect on the Company’s financial position, results of operations or cash flows.
In July 2002, the Public Company Accounting Reform and Investor Protection Act of 2002 (the Sarbanes-Oxley Act) was enacted. Section 404 stipulates that public companies must take responsibility for maintaining an effective system of internal control. Section 404(a) of the Act requires public companies to report on the effectiveness of their control over financial reporting and Section 404(b) requires public companies to obtain an attest report from their independent registered public accountant about management’s report. The Company is not required to comply with section 404(a) of the Act beginning June 30, 2009, but is not required to comply with Section 404(b) of the Act until the fiscal year ending June 30, 2010.
The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
NOTE 3 – CONCENTRATIONS OF CREDIT RISK:
The Company’s financial instruments that could be exposed to concentrations of credit risk consist primarily of cash and cash equivalents (see Note 1).
NOTE 4 - STOCK OPTIONS:
No options were granted during fiscal 2009 or fiscal 2008 and there are currently no options outstanding.
NOTE 5 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES:
Accounts payable and accrued expenses consisted of the following at June 30, 2009 and 2008:
|
| 2009 | 2008 | |||||
Administrative expenses |
| $ | 3,000 |
| $ | 3,000 |
| |
Professional fees |
|
| 130,000 |
|
| 120,000 |
| |
State and local taxes |
|
| 1,000 |
|
| 1,000 |
| |
Total |
| $ | 134,000 |
| $ | 124,000 |
|
NOTE 6 – COMMITMENTS AND CONTINGENCIES:
The Company leases office space in New York City for approximately $325 per month on a month to month basis. Rent expense totaled approximately $4,000 for each of the years ended June 30, 2009 and 2008.
NOTE 7 - INCOME TAXES:
The income tax provision consists of the following for the years ended June 30, 2009 and 2008:
|
| 2009 | 2008 | ||||||
Current: |
|
|
|
|
|
|
| ||
Federal |
| $ | - |
| $ | - |
| ||
State |
|
| 1,000 |
|
| 1,000 |
| ||
Total current |
| $ | 1,000 |
| $ | 1,000 |
| ||
Deferred: |
|
|
|
|
|
|
| ||
Federal |
| $ | - |
| $ | - |
| ||
State |
|
| - |
|
| - |
| ||
Total deferred |
|
| - |
|
| - |
| ||
|
|
|
|
|
|
|
| ||
Total tax provision |
| $ | 1,000 |
| $ | 1,000 |
|
At June 30, 2009, there were no deferred tax assets or liabilities recognized for taxable temporary differences.
The Company establishes a valuation allowance in accordance with the provisions of SFAS No. 109, “Accounting for Income Taxes.” The Company continually reviews the adequacy of the valuation allowance and recognizes a benefit from income taxes only when reassessment indicates that it is more likely than not that the benefits will be realized. At June 30, 2009 and 2008, the Company has provided a valuation allowance against all of its net deferred tax assets due to the uncertainty of realizing any benefit therefrom in the future.
A reconciliation of the income tax provision computed by applying the federal and state statutory rates to income before taxes to the actual income tax provision for the years ended June 30, 2008 and 2009 is as follows:
2009 | 2008 | ||||||
Federal provision of statutory rate | $ | - | $ | - | |||
State provision at statutory rate | $ | 1,000 | $ | 1,000 | |||
Valuation allowance and other | - | - | |||||
Total | $ | 1,000 | $ | 1,000 |
At June 30, 2009, the Company had available net operating loss (NOL) carryforwards of approximately $2,150,000for federal income tax purposes, which expire from 2013 to 2029. However, because of an ownership change that occurred on June 30, 2004, the federal NOLs are subject to certain annual limitations. This is because certain substantial ownership changes, as defined in Internal Revenue Code Section 382, limit the utilization of the available NOLs and tax credit carryforwards (the Section 382 Limitation). The Section 382 Limitation is calculated by multiplying the fair market value of the loss corporation immediately preceding the change of ownership by the long-term, tax-exempt rate prescribed by the IRS. Because of the change in ownership on June 30, 2004 and based on the Section 382 Limitation calculation, the Company will be allowed to use approximately $6,500 per year of its federal NOLs generated prior to June 30, 2004 until they would otherwise expire.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. |
Not applicable.
ITEM 9A(T). CONTROLS AND PROCEDURES.
Disclosure Controls and Procedures
As of the end of the period covered by this Report, the Company’s President, principal executive officer and principal financial officer, evaluated the effectiveness of the Company’s “disclosure controls and procedures,” as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934. Based on that evaluation, this officer concluded that, as of the date of his evaluation, the Company’s disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in the Company’s periodic filings under the Securities Exchange Act of 1934 is accumulated and communicated to management, including that officer, to allow timely decisions regarding required disclosure. It should be noted that a control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that it will detect or uncover failures within the Company to disclose material information otherwise required to be set forth in the Company’s periodic reports.
Report of Management on Internal Control over Financial Reporting
The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. Our internal control over financial reporting is a process designed by, or under the supervision of the Company’s Chief Executive Officer, who is also the Company’s Chief Financial Officer, to provide reasonable assurance to the Company’s management and Board of Directors regarding the reliability of financial reporting and the preparation and fair presentation of published financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the Company’s transactions and dispositions of the Company’s assets; (2) provide reasonable assurance that the Company’s transactions are recorded as necessary to permit preparation of the Company’s financial statements in accordance with GAAP, and that receipts and expenditures are being made only in accordance with authorizations of the Company’s management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the Company’s financial statements.
The Company’ management assessed the effectiveness of the Company’s internal control over financial reporting as of June 30, 2009. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission in Internal Control – Integrated Framework. Based on this assessment, the Company’s management concluded that (other than the fact that the Company has only one officer who is both its Chief Financial Officer and Chief Executive Officer), as of June 30, 2009, the Company’s internal control over financial reporting is effective and based on those criteria.
This Annual Report does not include an attestation report of the Company’s independent registered public accounting firm regarding internal control over financial reporting pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this Annual Report.
Changes in Internal Control Over Financial Reporting
There were no changes in the Company’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting during the fiscal year ended June 30, 2009.
ITEM 9B. OTHER INFORMATION
None.
PART III
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. |
Background of Directors and Executive Officers
Bernard Zimmerman, 76, became Chairman of the Board, President, Chief Executive Officer, Treasurer and a director of the Company on June 30, 2004. He has been President and Treasurer of Bernard Zimmerman & Company, Inc., a financial and management consulting firm (“Zimmerman Company”), since 1972. Since July 2003, Mr. Zimmerman has also served as President and Chief Executive Officer and a director of FCCC, Inc., a company engaged in seeking mergers, acquisitions, other business combinations and financial transactions. Since August 2007, Mr. Zimmerman has served as Chairman, President, Chief Operating Officer and Principal Financial Officer of St. Laurence Seaway Corporation, a company engaged in seeking mergers, acquisitions, reverse mergers and other financial transactions. Mr. Zimmerman also served as a director and member of the Audit Committee of Sbarro, Inc. for more than 20 years until January 2007. Mr. Zimmerman has been a certified public accountant in New York for more than the past thirty-five years.
Gordon Banks, 53, has served as a director of the Company since its inception in 1987. He served as President of the Company from June 1988 until June 30, 2004 and Chief Executive Officer of the Company from September 2003 until June 2004. From its inception in 1987 until June 1988, Mr. Banks served as Vice President of the Company. Since November 1988, Mr. Banks has been co-director of Enviro Stables Ltd., a company engaged in acquiring, breeding, racing and selling horses.
Conrad J. Gunther, Jr., 62, became a director of the Company on June 30, 2004. Since January 2008, Mr. Gunther has served as a Senior Vice President and Senior Loan Officer for Community National Bank, a Long Island based commercial bank, where he is responsible for all commercial lending. Mr. Gunther has also served, since 2001, as the President of E-Billsolutions, Inc., an independent sales organization that assists merchants in arranging the processing of their credit card transactions. Mr. Gunther is also a director of CVD Equipment Corporation.
Marc J. Hanover, 59, has served as Secretary of the Company since its inception in 1987. He served as Vice President-Finance, Chief Financial Officer and Treasurer of the Company from its inception in 1987 until June 30, 2004. Since November 1988, Mr. Hanover has been co-director of Enviro Stables Ltd., a company engaged in acquiring, breeding, racing and selling horses.
Gordon Banks serves as a Class I director, Conrad J. Gunther, Jr. serves as a Class II director and Bernard Zimmerman serves as a Class III director of the Company. Class I directors were scheduled to serve until the 2004 Annual Meeting of Stockholders, Class II directors were scheduled to serve until the 2005 Annual Meeting of Stockholders and Class III directors are scheduled to serve until the 2006 Annual Meeting of Stockholders, respectively, and until their respective successors are elected and qualified. Annual Meetings of Stockholders were scheduled to be held during the month of December in each such year; however no Annual Meeting of Stockholders has been held since 2004. Officers hold office at the pleasure of the Board of Directors.
Board Committees
Because the Company’s securities are not listed on an exchange or quoted on an automated inter-dealer quotation system, the Company’s Board of Directors has not established Audit, Compensation or Nominating Committees. The Company’s entire Board of Directors serves as those committees.
Audit Committee Financial Expert
The Board of Directors of the Company has determined that Bernard Zimmerman qualifies as an “audit committee financial expert,” as that term is defined in Item 401(d)(5) of Regulation S-K. Mr. Zimmerman is also Chairman of the Board, President, Chief Financial Officer, a director and a principal stockholder of the Company and, therefore, is not an independent director.
Procedures for Recommending Nominees to the Board of Directors
The Company’s Board of Directors does not have a formal policy with regard to the consideration of any director recommended by security holders due to its relatively small size and the fact that it presently has no operating activities.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s executive officers and directors, and persons who beneficially own more than 10% of the Company’s Common Stock, to file initial reports of ownership, and reports of changes of ownership, of the Company’s equity securities with the SEC and furnish copies of those reports to the Company. Based on a review of reports furnished to the Company and information available to the Company regarding the record ownership of shares, the Company believes that all reports required to be filed by such persons with respect to the Company’s fiscal year ended June 30, 2009 were timely filed.
Code of Ethics
The Company has adopted a code of ethics that applies to its principal executive officer, principal financial officer, principal accounting officer, controller and persons performing similar functions, a copy of which is filed as Exhibit 14.1 to this Report by incorporation by reference to Exhibit 14.1 to the Company’s Annual Report on Forms 10-KSB for the year ended June 30, 2004.
EXECUTIVE COMPENSATION. |
Summary Compensation Table
No executive officer was awarded, earned or paid any compensation by or on behalf of the Company for services rendered to the Company during the Company’s fiscal years ended June 30, 2009 or 2008.
The Company has no pension, health, annuity, bonus, insurance, equity incentive, non-equity incentive, stock options, profit sharing or similar benefit plans. No equity incentive plan awards or non-equity incentive plan compensation was granted to, or earned by, any directors or executive officers during the Company’s fiscal year ended June 30, 2009 or 2008. No stock options or stock appreciation rights were granted to any of the Company’s directors or executive officers during the Company’s fiscal year ended June 30, 2009 or June 30, 2008 and none are outstanding.
Outstanding Equity Awards
As of June 30, 2009, none of the Company’s directors or executive officers held unexercised options, stock that had not vested, or equity incentive plan awards.
Remuneration of Directors
No director received compensation for services rendered to the Company for the fiscal year ended June 30, 2009. The Company has no arrangements pursuant to which directors are compensated for services provided as a director.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS. |
The following table sets forth information, as at August 1, 2009, with respect to the shares of the Company’s Common Stock beneficially owned by (i) any person (including any “group,” as that term is used in Section 13(d)(3) of the Securities Exchange Act of 1934) who is known to the Company to be the beneficial owner of more than five percent of the Company’s outstanding Common Stock, (ii) each executive officer of the Company, (iii) each director of the Company and (iv) all executive officers and directors of the Company as a group:
Beneficial Owner | Amount and Nature of Beneficial Ownership | Percent of Class | |
|
|
| |
Bernard Zimmerman & Company, Inc. 18 High Meadow Road Weston, CT 06883
| 4,700,000 | 33.1% | |
Berman Industries, Inc. 1 Bridge Plaza Ft. Lee, NJ 07024
| 2,600,000 | 18.3% | |
Gordon Banks 25 Fifth Avenue New York, NY 10003
| 1,549,808 | 10.9% | |
Janice Banks
| 1,523,395 (1) | 10.7% | |
Palisade Investors LLC | 1,504,545 | 10.6% | |
Conrad J. Gunther, Jr. | 300,000 | 2.1% | |
Marc J. Hanover | 194,148 | 1.4% | |
Directors and executive officers as a group (four persons)
| 6,743,956 | 47.5%
|
___________________________
(1) Includes 293,395 shares held by The Russell Banks Family Trust, as to which Janice Banks and a third party are the trustees and share voting and dispositive power.
Securities Authorized for Issuance Under Equity Compensation Plans
At June 30, 2009, the Company had no compensation plans or individual compensation arrangements, whether or not approved by the Company’s security holders, under which any equity securities or options, warrants or rights to acquire equity securities are outstanding or authorized for issuance.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE. |
Since July 1, 2008, there have been no, and there are no currently proposed, transactions in which the Company was or is to be a participant with any related person or in which any related person had or will have a direct or indirect material interest. The terms “transactions,” “related person,” and “direct or indirect material interest” have the meanings afforded those terms under Item 404 of Regulation S-K promulgated by the Securities and Exchange Commission.
Bernard Zimmerman & Company, Inc. and Bernard Zimmerman may be deemed to control the Company by virtue of the stock ownership of Bernard Zimmerman & Company, Inc. and the positions in the Company held by Bernard Zimmerman.
The Company’s Common Stock is quoted through the OTC Bulletin Board System. For purposes of determining whether members of the Company’s Board of Directors are “independent,” the Company’s Board utilizes the standards set forth in the NASDAQ Stock Market Marketplace Rules. The Company’s entire Board serves as its Audit, Compensation and Nominating Committees. The Company’s Board of Directors has determined that, of the Company’s present directors, Gordon Banks and Conrad J. Gunther, Jr., constituting two of the three members of the Board, are “independent directors,” as defined under NASDAQ’s Marketplace Rules, for purposes of qualifying as independent members of the Board and an Audit, Compensation and Nominating Committee of the Board, but that Mr. Zimmerman, since he is an Executive Officer of the Company is not an “independent director.” In reaching its conclusion, the Board determined that Messrs. Banks and Gunther do not have a relationship with the Company that, in the Board’s opinion, would interfere with their exercise of independent judgment in carrying out the responsibilities of a director, and do not have any of the specific relationships set forth in NASDAQ’s Marketplace Rules that would disqualify any of them from being considered independent directors.
PRINCIPAL ACCOUNTANT FEES AND SERVICES. |
Audit Fees
The fees of Braver for audit services related to its audits of the Company’s financial statements for the years ended June 30, 2009 and 2008, respectively, and for its reviews of the Company’s interim financial statements, included in Quarterly Reports on Form 10-Q filed by the Company during those fiscal years, was $3,000 in each of those years. The appointment of Braver P.C. as the auditors for the Company became effective January 4, 2008.
Audit-Related Fees
Braver did not render any non-audit-related services during fiscal 2009 or 2008.
Tax Fees
Braver intends to bill the Company $1,000 for the preparation of the Company’s federal, state and local income tax returns for the Company’s fiscal year ended June 30, 2009. Braver billed $1,000 for its services in connection with the preparation of the Company’s federal, state and local income tax returns for the year ended June 30, 2008.
Other Fees
Braver performed no other services for the Company during either fiscal 2009 or 2008.
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors
The Board of Directors’ present policy is to pre-approve all audit services and permissible non-audit services provided by the independent auditors. All services performed by the Company’s independent auditors in fiscal 2009 and 2008 were pre-approved by the Board of Directors. It is expected that pre-approval will be for periods up to one year for services to be set forth in engagement letters approved by the Board of Directors that are detailed as to the particular service or category of services to be provided and subject to a specific budget.
PART IV
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. |
(a) |
| Financial Statements |
The following financial statements of the Company are contained in this Report on the pages indicated:
| Page | |
Report of Independent Registered Public Accounting Firm | 12 | |
Financial Statements: |
| |
Balance Sheets – June 30, 2009 and 2008 | 13 | |
Statements of Operations – years ended June 30, 2009 and 2008 | 14 | |
Statements of Changes in Stockholders’ Deficit - years ended June 30, 2009 and 2008 | 15 | |
Statements of Cash Flows – years ended June 30, 2009 and 2008 | 16 | |
Notes to Financial Statements | 17-23 |
(b) |
| Exhibits |
Exhibit | Description | |
|
| |
*3 | 1(a) | Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on June 12, 1987. |
*3 | .1(b) | Certificate of Amendment to the Company’s Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on December 19, 1989. |
*3 | .1(c) | Certificate of Amendment to the Company’s Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on December 6, 2000. |
*3 | .1(d) | Certificate of Amendment to the Company’s Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on June 30, 2004. |
**3 | .2 | By-laws of the Company. |
*14 | .1 | Code of Ethics for Principal Executive Officers and Senior Financial Officers. |
31 | .1 | Section 302 Certification of Principal Executive Officer and Principal Financial Officer. |
32 | .1 | Section 906 Certification of Principal Executive Officer and Principal Financial Officer. |
____________________
* | Incorporated by reference to the same numbered exhibit in the Company’s Annual Report on Form 10-KSB for the year ended June 30, 2004. |
** | Incorporated by reference to Exhibit 3.2 to Amendment No. 1 to the Company’s Registration of Securities on Form 10 filed on June 16, 1987, File 10, File No. 0-15862. |
(c) | Financial Statement Schedules |
| None. |
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.
GVC VENTURE CORP.
| |||
Dated: August 28, 2009 | |||
By: | /s/ Bernard Zimmerman | ||
| Bernard Zimmerman, |
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
/s/ Bernard Zimmerman |
| Capacity |
| Date |
Bernard Zimmerman
|
| President, (Principal Executive Officer),Treasurer (Principal Financial and Accounting Officer) and Director |
| August 28, 2009 |
|
|
|
|
|
/s/ Gordon Banks |
|
|
|
|
Gordon Banks |
| Director |
| August 28, 2009 |
|
|
|
|
|
/s/ Conrad J. Gunther, Jr |
|
|
|
|
Conrad J. Gunther, Jr. |
| Director |
| August 28, 2009 |
EXHIBIT INDEX
Exhibit | Description | |
|
| |
*3 | 1(a) | Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on June 12, 1987. |
*3 | .1(b) | Certificate of Amendment to the Company’s Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on December 19, 1989. |
*3 | .1(c) | Certificate of Amendment to the Company’s Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on December 6, 2000. |
*3 | .1(d) | Certificate of Amendment to the Company’s Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on June 30, 2004. |
**3 | .2 | By-laws of the Company. |
*14 | .1 | Code of Ethics for Principal Executive Officers and Senior Financial Officers. |
31 | .1 | Section 302 Certification of Principal Executive Officer and Principal Financial Officer. |
32 | .1 | Section 906 Certification of Principal Executive Officer and Principal Financial Officer. |
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* | Incorporated by reference to the same numbered exhibit in the Company’s Annual Report on Form 10-KSB for the year ended June 30, 2004. |
** | Incorporated by reference to Exhibit 3.2 to Amendment No. 1 to the Company’s Registration of Securities on Form 10 filed on June 16, 1987, File 10, File No. 0-15862. |