UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM 10Q
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(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 ___________
Commission file number: 000-51139
NAVIDEC FINANICAL SERVICES, INC.
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(Exact name of registrant as specified in its charter)
Colorado 13-4228144
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(State of Incorporation) (IRS Employer ID Number)
2000 South Colorado Blvd., Suite 200, Denver, Colorado 80222
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(Address of principal executive offices)
303-222-1000
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(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.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited) Page
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Report of Independent Registered Public Accounting Firm F-1
Consolidated Balance Sheets - March 31, 2008 and
December 31, 2007 F-2
Consolidated Statement of Operations -
Three months ended March 31, 2008 and 2007 and F-3
Consolidated Statement of Changes in Stockholders' Equity -
March 31, 2008 F-4
Consolidated Statement of Cash Flows -
Three months ended March 31, 2008 and 2007 F-5
Notes to Consolidated Financial Statements F-6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 1
Item 3. Quantitative and Qualitative Disclosures About Market Risk - Not Applicable
Item 4. Controls and Procedures 3
Item 4T. Controls and Procedures 3
PART II - OTHER INFORMATION
Item 1. Legal Proceedings -Not Applicable 4
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 4
Item 3. Defaults Upon Senior Securities - Not Applicable 4
Item 4. Submission of Matters to a Vote of Security Holders - Not Applicable 5
Item 5. Other Information - Not Applicable 5
Item 6. Exhibits 5
SIGNATURES 6
PART I
ITEM 1. FINANCIAL STATEMENTS
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(In Thousands)
March 31, December 31,
2008 2007
(Unaudited) (Audited)
---------------- ----------------
ASSETS:
Current Assets:
Cash and cash equivalents $ 3,189 $ 1,424
S/T Mortgages receivable 2,770 2,204
S/T Note receivable - Jaguar Group LLC 1,392 1,100
Accrued interest receivable 54 46
Advances receivable 3 5
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Total Current Assets 7,408 4,779
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Property, equipment and software, net 71 39
Other Assets
Notes receivable - (Note 4) - Aegis/Grizzle 450 450
Investment - BPZ Energy - (note 5) 3,260 3,354
Investments - (Note 5) 2,170 1,639
Other assets 5 15
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Total Other Assets 5,885 5,458
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TOTAL ASSETS $ 13,364 $ 10,276
================ ================
LIABILITIES & STOCKHOLDERS' EQUITY:
Current Liabilities:
Advances repayable - related party $ 41 $ 15
Short term borrowings (Note 7) 991 285
Accrued taxes and liabilities 831 102
---------------- ----------------
Total Current Liabilties 1,863 402
Stockholders' Equity:
Common stock, $0.001 par value, 100,000,000 shares 9 9
authorized, 9,093,445 and 8,993,583 shares issued
and outstanding at March 31, 2008 and
December 31, 2007 respectively
Additional paid-in capital 7,557 7,552
Treasury stock (150) (150)
Unrealized gain on securities 2,657 2,149
Accumulated earnings / (deficit) 1,428 314
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Total Stockholders' Equity 11,501 9,874
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TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 13,364 $ 10,276
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The accompanying notes to the consolidated financial statements are an integral part of these statements.
F-2
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
Statement of Operations
(In Thousands)
(Unaudited)
For the Three Months Ended
March 31,
2008 2007
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Revenue
Sales $ 258 $ 224
Cost of Sales 224 -
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Gross Profit 34 224
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Operating Expenses:
General and administrative 470 392
Depreciation and amortization 10 2
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Total operating expenses 480 394
Loss from operations (446) (170)
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Other income (expense)
Gain on sale of investments 2,385 201
Other loss (14) -
Interest income 66 -
Interest (expense) (15) -
Impairment loss on write off of assets (67) -
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Total other income 2,422 201
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Net Income before minority interest and income tax 1,976 31
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Minority Interest
Minority interest in consolidated subsidiary - (8)
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Net Income before taxes 1,909 23
Income Taxes
Provision for income tax (795) -
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Net Income $ 1,114 $ 23
=============== ===============
Earnings Per Share:
Basic $ 0.12 $ *
Diluted $ 0.07 $ *
Weighted Averge Shares Outstanding:
Basic 9,093 7,983
=============== ===============
Diluted 15,489 16,097
=============== ===============
*Less than $(0.01) per share.
The accompanying notes to these financial statements are an integral part of these statements.
F-3
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
Consolidated Statement of Cash Flows
(In Thousands)
(Unaudited)
For the Three Months Ended
March 31,
2008 2007
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Cash Flows from Operating Activities:
Net Income $ 1,114 $ 23
Adjustments to reconcile net loss to net cash used in operating activities:
Impairment on write off of assets 67 -
Depreciation expense 10 2
Gain on sale investments - (199)
Minority interest - 8
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable (3) 37
Increase in prepaid expenses and other assets - (10)
Decrease in short term loans receivable (861) -
Increase in short term borrowings 706 -
Increase (decrease) in accounts payable 26 (44)
Increase (decrease) in accrued liabilities and other 729 (5)
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Net CashProvided (Used) by Operating Activities 1,788 (188)
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Cash Flows from Investing Activities:
Investments (increased)/decreased
Boston real estate (290) -
Other real estate (241) -
BPZ warrants/goodwill 94 362
Increase in fixed assets (99) -
Proceeds from sale of equity investments - 199
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Net Cash (Used) Provided by Investing Activities (469) 561
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Cash Flows from Financing Activities:
Cash from exercise of options 5 -
Unrealized gain/(loss) on securities 508 -
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Net Cash Provided by Financing Activities 513 -
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Net Increase in Cash & Cash Equivalents 1,765 374
Beginning Cash & Cash Equivalents 1,424 179
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Ending Cash & Cash Equivalents $ 3,189 $ 553
================= =================
Supplemental Disclosure of Cash Flow Information
Cash paid for Interest $ 15 -
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Cash paid for Income Taxes $ 103 -
================= =================
The accompanying notes to consolidated financial statements are an integral part of these statements.
F-4
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
For the Three Months Ended March 31, 2008
(In thousands - except number of shares)
(Unaudited)
Voting Additional Unrealized Treasury Accumulated Stockholder
Common Stock Paid-in Gain Stock Profit Equity
------------------------
Shares Amount Capital (Deficit)
----------- ---------- ----------- --------- ------------- ------------
Balances, Dec 31, 2004 6,378,048 $ 6 $ 5,911 $ 375 $ - $ (2,132) $ 4,160
----------- ---------- ---------- ----------- --------- ------------- ------------
BPZ legacy options exercised 963 963
Options exercised 250,000 1 13 14
Common stock sold in private 1,322,000 1 1,323 1,324
placement -
Additional paid-in capital from 1,203 1,203
reorganization
Net loss (1,377) (1,377)
Comprehensive Income
Gain on marketable securities 450 450
Total Comprehensive gain/(loss)
----------- ---------- ---------- ----------- --------- ------------- ------------
Balances, Dec 31, 2005 7,950,048 8 9,413 825 - (3,509) 6,737
Net loss (464) (464)
Comprehensive Income
Gain on marketable securities 658 658
Total Comprehensive gain/(loss)
----------- ---------- ---------- ----------- --------- ------------- ------------
Balances, Dec 31, 2006 7,950,048 8 9,413 1,483 - (3,973) 6,931
Net income 4,287 4,287
Options exercised 1,000,000 1 49 50
Correct BPZ transaction 33,397 2 2
Correct private placement 10,000
Remove BPZ warrants (1,912) (1,912)
Treasury stock - Armijo settlement (68,862) (150) (150)
Comprehensive other income
Gain on marketable securities 666 666
----------- ---------- ---------- ----------- --------- ------------- ------------
Balances, Dec 31, 2007 8,924,583 9 7,552 2,149 (150) 314 9,874
Net income 1,114 1,114
Options exercised 100,000 5 5
Comprehensive other income -
Gain on marketable securities 508 508
----------- ---------- ---------- ----------- --------- ------------- ------------
Balances - March 31, 2008 9,024,583 $ 9 $ 7,557 $ 2,657 $ (150) $ 1,428 $ 11,501
=========== ========== ========== =========== ========= ============= ============
The accompanying notes to consolidated financial statements are an integral part of these financial statements.
F-5
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, Old Navidec affected a one share of NFS for one share of Old Navidec
spin 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
approximately $446,000. The Company sold approximately 150,000 shares of BPZ
Energy in the open market. This activity produced a onetime gain of
approximately $2,385,000. Other income contributed an additional $52,000.
Jaguar Group Investments, LLC
In February 2008, our subsidiary, Northsight entered into a joint venture
agreement with Jaguar Group, LLC. Northsight purchased a 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.
F-6
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2008 and 2007
(Unaudited)
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INTERIM PRESENATION
The unaudited consolidated financial statements and related notes for the three
months ended March 31, 2008, 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.
PRINCIPLES OF CONSOLIDATION
The accompanying consolidated financial statements include the accounts of NFS
and its subsidiary, Northsight, Inc. and Northsight Mortgage formerly known as
Navidec Mortgage Holdings, Inc. NFS owns 98% of Northsight and the former
minority member or Northsight Mortgage Group, LLC owns 2% of Northsight, Inc.
All significant inter-company balances and transactions have been eliminated in
consolidation.
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.
F-7
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2008 and 2007
(Unaudited)
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.
NFS performs ongoing evaluations of its clients' financial condition and
generally does not require collateral, except for billings in advance of work
performed. 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. There was no allowance at December 31,
2007.
No sales to unaffiliated customers represented 10% or more of the Company's
revenue for the three months ended March 31, 2008.
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 approximately $2,657,000.
Investments in non-publicly traded equity securities or non-marketable equity
securities are stated at the lower of cost or estimated realizable value.
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.
F-8
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2008 and 2007
(Unaudited)
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 $66,000.
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 accrues interest and penalty
interest income at the end of each quarter.
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 $795,000 related primarily to profits generated on the sale of
stock assets.
ACCRUALS
The Company follows the practice of paying all bills when received and therefore
has not accrued any expenses.
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.
F-9
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2008 and 2007
(Unaudited)
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 6,396,511 options and warrants have been included in the
determination of diluted earnings per share.
COMPREHENSIVE INCOME (LOSS)
Comprehensive income (loss) includes net income or loss and changes in equity
from the market price variations in the BPZ stock held by the Company. During
the quarter ended March 31, 2008, the unrealized gain from BPZ stock was
$1,507,500. This gives, the Company's a comprehensive gain for the quarter ended
March 31, 2008 of approximately $1,507,500.
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
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.
F-10
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2008 and 2007
(Unaudited)
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 "investments in BPZ", 150,000 shares, was valued at
approximately $3,259,500 on March 31, 2008 (300,000 shares were valued at
$3,354,000 on December 31, 2007).
NOTE 4 - NOTES RECEIVABLE
During the year ended December 31, 2007, we entered 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 caries an 8% interest rate and is secured 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.
F-11
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2008 and 2007
(Unaudited)
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 are 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)
NOTE -5 - INVESTMENTS
In November of 2007, Northsight, Inc. (a 98% owned subsidiary of the Company)
entered into a purchase agreement to acquire a 3 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 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, provide rental income to the Company and may
be held to rent or sold in the future.
The Company holds 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
$3,259,000. Management believes that this valuation is accurate and consistent
with prior valuations.
F-12
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2008 and 2007
(Unaudited)
NOTE 6 - CAPITAL LEASES OBLIGATIONS
NFS acquired no property under capital lease arrangements during the quarters
ended March 31, 2008 or 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, the
subsidiary had drawn a total of approximately $155,000 against a total line of
$3,000,000.
NOTE 8 - SUBSIDIARIES
The accompanying consolidated financial statements include the accounts of NFS
and its subsidiary, Northsight, Inc. (formerly called Navidec Mortgage Holdings,
Inc) and its subsidiary Northsight Mortgage Group, LLC. of Phoenix, Arizona. All
significant inter-company balances and transactions have been eliminated in
consolidation.
We are currently operating in the mortgage services sector. During the quarter
ended March 31, 2008, the revenues for the mortgage services business were
approximately $258,000. During the quarter ended March 31, 2007, mortgage
services generated approximately $224,000 in revenues. During the quarter ended
March 31, 2008, we incurred a loss from operations of $446,000. During the
quarter ended March 31, 2007, we incurred a loss from operations of
approximately $171,000.
Northsight is focused on the Arizona 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.
F-13
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2008 and 2007
(Unaudited)
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 Northsight Northsight Navidec Northsight Northsight
Financial Inc Mortgage Financial Inc Mortgage
Services LLC Services LLC
------------ ------------- ------------ ------------ ------------ -------------
Revenue
Sales $ - $ 110 $ 149 $ - $ - $ 224
Cost of Sales - 114 110 186
------------ ------------- ------------ ------------ ------------ -------------
Gross Profit - (4) 39 - - 38
Operating Expenses
General and Administrative 318 87 67 131 - 75
Depreciation 2 8 2
------------ ------------- ------------ ------------ ------------ -------------
Total Operating Expenses 318 89 75 133 - 75
Other Income/(Expense)
Gain on sale of investments 2,385 199
Interest income 18 48 2
Interest expense (1) (14)
Other income/(expense) (875)
------------ ------------- ------------ ------------ ------------ -------------
Total Other Income/(Expense) 1,527 34 - 201 - -
Net Income (Loss) $ 1,209 $ (59) $ (36) 68 - $ (37)
============ ============= ============ ============ ============ =============
NOTE 9 - 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.
F-14
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2008 and 2007
(Unaudited)
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:
2008
Weighted Average
Shares Exercise Price
Outstanding, January 1, 2008 3,618,510 $ 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
========= =========
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
During the quarter ended March 31, 2008 the Company did not issue any
warrants.
F-15
NAVIDEC FINANCIAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended March 31, 2008 and 2007
(Unaudited)
NOTE 10 - 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.
F-16
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
NFS 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.
NFS 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 a 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 sales of $258,000
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 sales of $224,000. The increase of $34,000 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 $224,000 in cost of
sales. During the period ended March 31, 2007, we did not recognize any costs in
connection with our sales.
During the three months ended March 31, 2008, we recognized a gross profit
margin of $34,000 compared to $224,000 for the three months ended March 31,
2007. The decrease of $190,000 was a result of a change in accounting policies
1
whereby we now recognize salaries and consulting services as part of the cost of
sales in Northsight's mortgage operations.
During the three months ended March 31, 2008, we incurred total operating
expenses of $480,000 compared to $394,000 during the three months ended March
31, 2007. The increase of $86,000 is result of a redirection 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, as
seen in the increase of $78,000 in general and administrative expenses. During
the three months ended March 31, 2008 we incurred general and administrative
expense of $470,000 compared to $392,000 during the three months ended March 31,
2007.
During the year ended March 31, 2008, we recognized net income of $1,114,000
compared to $23,000 during the three months ended March 31, 2007. The increase
of $1,091,000 was a result of the $2,385,000 gain on the sale of shares we hold
in BPZ Petroleum. During the three months ended March 31, 2008, we sold 150,000
shares of BPZ for cash of approximately $2,385,000 to expand Northsight's
mortgage operations, create our bridge loan product and increase our bridge loan
portfolio
LIQUIDITY
Net cash provided by operating activities during the three months ended March
31, 2008 was $1,721,000, compared to net cash used in operating activities
during the three months ended March 31, 2007 of $188,000. During the three
months ended March 31, 2008, the net cash provided represented net income of
$1,114,000, adjusted for the non-cash item of depreciation expense of $10,000.
During the three months ended March 31, 2007, the net cash used represented net
income of $23,000, adjusted certain non-cash items consisting of depreciation
expense of $2,000, a gain on the sale of investments of $199,000 and a minority
interest of $8,000.
During the three months ended March 31, 2008, we used $469,000 in cash in
investing activities. We invested $32,000 in fixed assets, $290,000 in real
estate in Boston, Massachusetts and $241,000 in other real estate prospects.
During the three months ended March 31, 2008, we eliminated $94,000 in
connection with the goodwill/warrants of BPZ.
During the three months ended March 31, 2007, we received cash of $561,000 from
our investment activities, consisting of $191,000 from the sale of equity
investments and $362,000 due to an increase in the value of our warrants in BPZ.
During the three months ended March 31, 2008, we recognized $513,000 from our
financing activities. We had an unrealized a gain of $508,000 on securities.
During the three months ended March 31, 2007, we did not receive any funds
through our financing activities.
At March 31, 2008, we had total current assets of $7,408,000, consisting of cash
of $3,189,000, mortgage receivables of $2,770,000, a note receivable of
$1,392,000, accrued interest receivable of $54,000 and an advance receivable of
$3,000. At March 31, 2008, we had total current liabilities of $1,863,000,
consisting of an advance payable of $41,000, short term borrowings of $991,000
and accrued taxes and liabilities of $831,000. Current assets exceed current
liabilities by $5,545,000.
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
2
these and other accounting policies, see Note 2 in the Notes to the Consolidated
Financial Statements beginning on page F-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. As of March 31, 2008, the Company had made $4,162,000 in
such loans. The loans are secured by first deeds of trust on residential real
estate properties.
RESERVES FOR BAD DEBT
NFS's policy on reserves for bad debt determines the timing and recognition of
expenses. The Company follows guidelines that reserve based off of historical
and account specific trends; however, certain judgments affect the application
of NFS bad debt reserve 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, no allowance for bad debt was recorded.
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 impairment for Goodwill should be carried as an asset on its
books for the three months ended March 31, 2008.
3
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
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 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
4
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
(iii) provide reasonable assurance regarding prevention or timely
detection of unauthorized
Management's assessment of the effectiveness of the small business issuer's
internal control over financial reporting is as of the quarter ended March 31,
2008. We believe that internal control over financial reporting is effective. We
have not identified any, current material weaknesses considering the nature and
extent of our current operations and any risks or errors in financial reporting
under current operations.
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.
This quarterly 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 Securities
and Exchange Commission that permit the Company to provide only management's
report in this annual report.
There was no change in our internal control over financial reporting that
occurred during the fiscal 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
The Company made the following unregistered sales of its securities from January
1, 2008 through March 31, 2008:
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.
5
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.
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
5
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: May 14, 2008 By: /s/ John McKowen
----------------
John McKowen, President &
Chief Accounting Officer
6