Attached files
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-Q
(Mark
One)
x
|
QUARTERLY
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For
quarterly period ended September 30, 2009
o
|
TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
________FOR THE TRANSITION
PERIOD FROM _____ TO _____
Commission
File Number 000-52289
Power
of the Dream Ventures Inc.
(Exact
name of Small Business Issuer as specified in its charter)
Delaware
|
51-0597895
|
(State
or other jurisdiction of incorporation)
|
(I.R.S
Employer Identification No.)
|
1095
Budapest
Soroksari ut
94-96
Hungary
(Address
of principal executive offices)
+36-1-456-6061
(Issuer’s
telephone number, including area code)
Check
whether the issuer (1) has filed all reports required to be filed by Section 13
or 15(d) of the Exchange Act 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 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 Web site, if any, every Interactive Data File required to be submitted or
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 to post such files.
Yes o No
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
definition 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
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Non-accelerated
filer o
(do
not check if 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 Exchange Act).
Yes
o No x
State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practicable date:
Common
Stock, $0.0001 par value
|
|
48,565,181
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(Class)
|
|
(Outstanding at November 14,
2009)
|
(A
Development Stage Company)
INDEX
TO FORM 10
September
30, 2009
Page
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PART
I – FINANCIAL INFORMATION
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|
ITEM
1 – CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
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2
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3
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4
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6
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7
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26
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34
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PART
II – OTHER INFORMATION
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35
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35
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36
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37
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37
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37
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38
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(A
DEVELOPMENT STAGE COMPANY)
CONSOLIDATED
BALANCE SHEET
Notes |
September 30,
2009
(Unaudited)
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December 31,
2008
(Audited)
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|||||||
ASSETS
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|||||||||
Current
Assets
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|||||||||
Cash
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$ | 86,853 | $ | 650,945 | |||||
Other
receivables
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3 | 25,813 | 25,131 | ||||||
Total
Current Assets
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112,666 | 676,076 | |||||||
Fixed
assets, net
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5 | 496,039 | 614,723 | ||||||
Total
Assets
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$ | 608,705 | $ | 1,290,799 | |||||
LIABILITIES
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|||||||||
Current
Liabilities
|
|||||||||
Accounts
payable and accrued liabilities
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$ | 186,694 | $ | 236,821 | |||||
Capital
leases payable, current portion
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7 | 59,442 | 63,399 | ||||||
Note
payable
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6 | 195,000 | 215,000 | ||||||
Total
Current Liabilities
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441,136 | 515,220 | |||||||
Long
term liabilities
|
|||||||||
Capital
leases payable, less current portion
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7 | 267,655 | 343,159 | ||||||
Total
Long Term Liabilities
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267,655 | 343,159 | |||||||
Stockholders’
Equity
|
|||||||||
Preferred
stock, $0.0001 par value, 10,000,000 shares
authorised, issued
|
|||||||||
Common
stock, $.0001 par value; 250,000,000 shares authorized, 48,565,181 shares
issued and outstanding
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8 | 4,857 | 4,762 | ||||||
Additional
Paid-In
Capital
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7,420,953 | 7,041,048 | |||||||
Deficit
accumulated during development stage
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(7,442,530 | ) | (6,236,547 | ) | |||||
Other
Comprehensive Income
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10,635 | 26,615 | |||||||
Unearned
Compensation
|
(94,001 | ) | (403,458 | ) | |||||
Total
Stockholders’ Equity
|
(100,086 | ) | 432,420 | ||||||
Total
liabilities and stockholders’ equity
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$ | 608,705 | $ | 1,290,799 |
(A
DEVELOPMENT STAGE COMPANY)
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Notes |
Three
Months
Ended
September 30,
2009
|
Three
Months
Ended
September 30,
2008
|
Nine
months
Ended
September 30,
2009
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Nine
months
Ended
September 30,
2008
|
For
the Period from April 26, 2006 (date of inception) to
September 30,
2009
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||||||||||||||||
Net
Sales
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$ | - | $ | - | $ | - | $ | - | $ | 5,833 | |||||||||||
Cost
of Sales
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- | - | - | - | (3,711 | ) | |||||||||||||||
Gross
margin
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- | - | - | - | 2,122 | ||||||||||||||||
Materials
and services
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4,090 | 8,970 | 12,316 | 23,058 | 58,484 | ||||||||||||||||
General
administration
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109,809 | 907,016 | 843,090 | 2,430,923 | 5,929,520 | ||||||||||||||||
Research
and development
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4 | 77,100 | 36,201 | 166,019 | 162,385 | 693,376 | |||||||||||||||
Personnel
expenses
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25,960 | 41,498 | 81,868 | 115,173 | 277,608 | ||||||||||||||||
Depreciation
and amortization
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5 | 30,654 | 32,801 | 87,922 | 88,699 | 233,015 | |||||||||||||||
Other
expenses, net
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7,778 | - | 11,192 | - | 7,737 | ||||||||||||||||
Operating
expenses
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255,391 | 1,026,486 | 1,202,407 | 2,820,238 | 7,199,740 | ||||||||||||||||
Loss
from operations
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(255,391 | ) | (1,026,486 | ) | (1,202,407 | ) | (2,820,238 | ) | (7,197,618 | ) | |||||||||||
(Interest
expense)/ interest income and exchange (losses)/ gains
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12,646 | (124,858 | ) | (2,738 | ) | (33,161 | ) | 6,689 | |||||||||||||
Loss
before provision (benefit) for income taxes
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(242,745 | ) | (1,151,344 | ) | (1,205,145 | ) | (2,853,399 | ) | (7,190,929 | ) | |||||||||||
Income
taxes
|
38 | - | 838 | - | 838 | ||||||||||||||||
Net
loss
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$ | (242,783 | ) | $ | (1,151,344 | ) | $ | (1,205,983 | ) | $ | (2,853,399 | ) | $ | (7,191,767 | ) | ||||||
Basic
and Diluted loss per share
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$ | (0.00 | ) | $ | (0.03 | ) | $ | (0.02 | ) | $ | (0.07 | ) | |||||||||
Weighted
average number of shares outstanding – Basic and diluted
|
48,565,181 | 42,949,502 | 48,413,643 | 42,167,694 |
(A
DEVELOPMENT STAGE COMPANY)
CONDENSED
CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (UNAUDITED)
Common
Shares
|
Stocks
Amount
|
Accumulated
Deficit During Developmental Stage
|
Additional
Paid
In
Capital
|
Other
Comprehensive
Income
|
Unearned
Compensation
|
Total
|
Comprehensive
Income/
(Loss)
|
|||||||||||||||||||||||||
Issuance
of common stock
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33,300,000 | 3,330 | 10,670 | 14,000 | ||||||||||||||||||||||||||||
Contributed
Capital
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96,100 | 96,100 | ||||||||||||||||||||||||||||||
Currency
Translation Adjustment
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4,151 | 4,151 | 4,151 | |||||||||||||||||||||||||||||
Net
loss for the period
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(35,100 | ) | (35,100 | ) | (35,100 | ) | ||||||||||||||||||||||||||
Balance
at December 31, 2006
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33,300,000 | 3,330 | (35,100 | ) | 106,770 | 4,151 | - | 79,151 | (30,949 | ) | ||||||||||||||||||||||
Contributed
Capital
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53,735 | 53,735 | ||||||||||||||||||||||||||||||
Recapitalization
upon Reverse Merger on April 10, 2007 (See Note 1)
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2,500,000 | 250 | (250,763 | ) | (250,513 | ) | ||||||||||||||||||||||||||
Private
placement of shares at $0.34 per share (See Note 8)
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2,250,000 | 225 | 764,775 | 765,000 | ||||||||||||||||||||||||||||
Shares
issued for services at $0.34 per share (See Note 8)
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1,875,000 | 188 | 637,313 | (467,501 | ) | 170,000 | ||||||||||||||||||||||||||
Shares
issued for research and development at $0.34 per share (See Note
8)
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100,000 | 10 | 33,990 | 34,000 | ||||||||||||||||||||||||||||
Private
placement at $2.5 per share (See Note 8)
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104,000 | 10 | 259,990 | 260,000 | ||||||||||||||||||||||||||||
Shares
issued for stock based compensation at $2.5 per share (See Note
8)
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1,036,000 | 104 | 2,589,896 | (2,590,000 | ) | - | ||||||||||||||||||||||||||
Amortization
of Unearned Compensation
|
1,124,932 | 1,124,932 | ||||||||||||||||||||||||||||||
Currency
Translation Adjustment
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(14,001 | ) | (14,001 | ) | (14,001 | ) | ||||||||||||||||||||||||||
Net
loss for the period
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(1,992,472 | ) | (1,992,472 | ) | (1,992,472 | ) | ||||||||||||||||||||||||||
Balance
at December 31, 2007
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41,165,000 | $ | 4,117 | $ | (2,278,335 | ) | $ | 4,446,469 | $ | (9,850 | ) | $ | (1,932,569 | ) | $ | 229,832 | $ | (2,037,422 | ) |
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
CONDENSED
CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (UNAUDITED)
Common
Shares
|
Stocks
Amount
|
Accumulated
Deficit During Developmental Stage
|
Additional
Paid
In
Capital
|
Other
Comprehensive
Income
|
Unearned
Compensation
|
Total
|
Comprehensive
Income/
(Loss)
|
|||||||||||||||||||||||||
Balance
at December 31, 2007
|
41,165,000 | $ | 4,117 | $ | (2,278,335 | ) | $ | 4,446,469 | $ | (9,850 | ) | $ | (1,932,569 | ) | $ | 229,832 | $ | (2,037,422 | ) | |||||||||||||
Private
placement of shares at $3.25 per share (See Note 8)
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32,500 | 3 | 105,622 | 105,625 | ||||||||||||||||||||||||||||
Shares
issued for services at $0.7 per share (See Note 8)
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306,570 | 31 | 214,568 | (214,599 | ) | - | ||||||||||||||||||||||||||
Shares
issued for services at $0.75 per share (See Note 8)
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1,500,000 | 150 | 1,124,850 | (1,125,000 | ) | - | ||||||||||||||||||||||||||
Shares
issued for services at $1.35 per share (See Note 8)
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111,111 | 11 | 149,989 | (150,000 | ) | - | ||||||||||||||||||||||||||
Private
placement of shares at $0.4 per share (See Note 8)
|
2,500,000 | 250 | 999,750 | 1,000,000 | ||||||||||||||||||||||||||||
Shares
issued for Standby Equity Distribution Agreement at $0.4 per
share
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2,000,000 | 200 | (200 | ) | - | |||||||||||||||||||||||||||
Amortization
of Unearned Compensation
|
3,018,710 | 3,018,710 | ||||||||||||||||||||||||||||||
Currency
Translation Adjustment
|
36,465 | 36,465 | 36,465 | |||||||||||||||||||||||||||||
Net
loss for the period
|
(3,958,212 | ) | (3,958,212 | ) | (3,958,212 | ) | ||||||||||||||||||||||||||
Balance
at December 31, 2008
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47,615,181 | $ | 4,762 | $ | (6,236,547 | ) | $ | 7,041,048 | $ | 26,615 | $ | (403,458 | ) | $ | 432,420 | $ | (5,959,169 | ) | ||||||||||||||
Shares
issued for stock based compensation at $0.4 per share (See Note
8)
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700,000 | 70 | 279,930 | (280,000 | ) | - | - | |||||||||||||||||||||||||
Shares
issued for services at $0.4 per share (See Note 8)
|
250,000 | 25 | 99,975 | (60,000 | ) | 40,000 | ||||||||||||||||||||||||||
Amortization
of Unearned Compensation
|
649,457 | 649,457 | ||||||||||||||||||||||||||||||
Currency
Translation Adjustment
|
(15,980 | ) | (15,980 | ) | (15,980 | ) | ||||||||||||||||||||||||||
Net
loss for the period
|
(1,205,983 | ) | (1,205,983 | ) | (1,205,983 | ) | ||||||||||||||||||||||||||
Balance
at September 30, 2009
|
48,565,181 | $ | 4,857 | $ | (7,442,530 | ) | 7,420,953 | $ | 10,635 | $ | (94,001 | ) | $ | (100,086 | ) | $ | (7,181,132 | ) |
The accompanying notes are an integral part of
these condensed consolidated financial statements.
(A
DEVELOPMENT STAGE COMPANY)
CONSOLIDATED
STATEMENT OF CASH FLOWS
For
the period
ended
September 30,
2009
|
For
the period
ended
September 30,
2008
|
Cumulative
from
April 26,
2006
(date
of inception) to
September 30,
2009
|
||||||||||
CASH
FLOWS FROM OPERATING ACTIVITIES
|
||||||||||||
Net
loss
|
$ | 1,205,983 | $ | 2,853,399 | $ | 7,191,767 | ||||||
Adjustments
to reconcile net loss to net cash used in operating
activities:
|
||||||||||||
Amortization
of stock-based compensation
|
649,457 | 2,202,640 | 4,793,099 | |||||||||
Issue
of shares for legal services
|
40,000 | - | 210,000 | |||||||||
Recapitalization
under reverse merger
|
- | (250,763 | ) | |||||||||
Issue
of shares for research and development
|
- | - | 34,000 | |||||||||
Depreciation
and amortization
|
87,922 | 88,699 | 233,015 | |||||||||
(428,604 | ) | (562,060 | ) | (2,172,416 | ) | |||||||
Changes
in operating assets and liabilities:
|
||||||||||||
(Increase)
/decrease in other current assets
|
(682 | ) | 69,336 | (25,813 | ) | |||||||
Increase
in related party receivables
|
0 | 100,000 | - | |||||||||
Increase
in accounts payable and accrued liabilities
|
(70,127 | ) | 187,830 | 381,694 | ||||||||
Net
cash used in operating activities
|
(499,413 | ) | (204,894 | ) | (1,816,535 | ) | ||||||
CASH
FLOWS FROM INVESTING ACTIVITIES
|
||||||||||||
Purchase
of fixed assets
|
(48,699 | ) | (33,758 | ) | (401,957 | ) | ||||||
Net
cash used in investing activities
|
(48,699 | ) | (33,758 | ) | (401,957 | ) | ||||||
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||||||||||||
Proceeds
of loans from stockholders
|
- | - | 149,835 | |||||||||
Proceeds
from sale of common stock
|
- | 105,625 | 2,155,295 | |||||||||
Net
cash from financing activities
|
- | 105,625 | 2,305,130 | |||||||||
Effect
of exchange rate changes on cash
|
(15,980 | ) | (15,583 | ) | 215 | |||||||
Net
increase / (decrease) in cash
|
(564,092 | ) | (148,610 | ) | 86,853 | |||||||
Cash
at beginning of period
|
650,945 | 182,780 | - | |||||||||
Cash
at end of period
|
$ | 86,853 | $ | 34,170 | $ | 86,853 | ||||||
Supplemental disclosure of cash flow
information:
|
||||||||||||
Non-cash
investing and financing transactions
|
||||||||||||
Issuance
of shares for services
|
$ | 100,000 | 1,489,599 | $ | 2,155,295 | |||||||
Issuance
of shares for liabilities assumed under reverse merger
|
- | - | $ | 250,513 | ||||||||
Issuance
of stock based compensation shares
|
280,000 | - | $ | 2,894,000 | ||||||||
Purchase
of fixed assets through the assumption of capital lease
obligations
|
- | $ | 351,700 | $ | 327,097 | |||||||
Cash
paid for:
|
||||||||||||
Interest
|
- | - | - | |||||||||
Taxes
|
800 | - | 800 |
The
accompanying notes are an integral part of these condensed consolidated
financial statements.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
1 -
|
GENERAL
INFORMATION
|
Power of
the Dream Ventures, Inc., f/k/a “Tia V, Inc.” (“PDV” or the “Company”) was
incorporated in Delaware on August 17, 2006, with the objective to acquire, or
merge with, an operating business.
Reverse
merger
PDV
entered into and consummated a Securities Exchange Agreement (“Exchange
Agreement”) on April 10, 2007. Under the terms of the Exchange Agreement, PDV
acquired all the outstanding equity interests of Vidatech, Kft. (also known as
Vidatech Technological Research and Development LLC) a limited liability company
formed under the laws of the Republic of Hungary, (“Vidatech”) in exchange for
33,300,000 shares of PDV’s common stock, and Vidatech thereby became a
wholly-owned Hungarian subsidiary of PDV. PDV is governed by the law of the
State of Delaware, and its wholly-owned subsidiary, Vidatech, is governed by the
law of the Republic of Hungary. PDV and Vidatech are herein collectively
referred to as the “Company.”
Following
the acquisition the former stockholders of Vidatech owned a majority of the
issued and outstanding common stock of PDV and the management of Vidatech
controlled the Board of Directors of PDV and its wholly-owned Hungarian
subsidiary Vidatech. Therefore the acquisition has been accounted for as a
reverse merger (the “Reverse Merger”) with Vidatech as the accounting acquirer
of PDV. The accompanying condensed consolidated financial statements of the
Company reflect the historical results of Vidatech, and the condensed
consolidated results of operations of PDV subsequent to the acquisition date. In
connection with the Exchange Agreement, PDV adopted the fiscal year end of
Vidatech as December 31.
All
reference to shares and per share amounts in the accompanying condensed
consolidated financial statements have been restated to reflect the
aforementioned shares exchange.
Business
The
Company is engaged in the acquisition, development, licensing and
commercialization of and the investment in, directly or through business
acquisitions, technologies developed in Hungary. In furtherance of its business,
the Company provides research and development services to the companies,
inventors from whom it acquires technologies or participation interests in
technologies. A goal of the Company is to support research and development
activities and to sell the products of inventions to the technological
market
From
inception through September 30, 2009, the Company primarily focused on the
raising of capital. As of September 30, 2009, the Company manages ten
technologies: RiverPower, the Kalmar inventions (FireSAFE fire-proofing liquid;
technology for utilizing communal waste as a concrete additive; technology for
repairing potholes with the use of recycled plastics; technology for
neutralizing red mud; biodegreadable deiing solution and PVC shielded electric
cable recycling technology), the Buresch inventions (Desalination technology,
water and gasoline mixing technology for use in internal combustion engines) and
an equity interest in ‘in4 Kft’, a company formed to develop next generation
semantic internet based search engine and content organizer applications. All of
these technologies are still in the development stage (see Note
4).
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
1 -
|
GENERAL
INFORMATION - Continued
|
As of
September 30, 2009, the Company has only realized limited revenues from the now
discontinued TothTelescope project and has not realized any revenues from the
other inventions. As a result, the accompanying consolidated financial
statements have been presented on a development stage basis.
FireSAFE
On August
20, 2008 the Company licensed its FireSAFE technology to a group of Hungarian
investors for a license acquisition fee of HUF 20,000,000 (approximately
$120,000), where half of the license fee was received by the Company in August
of 2008, and the other half due once independent testing and verification of the
technology completed. The received amount was recorded as a liability in
accordance with ASC 605-10-S99 “Revenue Recognition”, which superseded Staff
Accounting Bulletin No. 101, “Revenue Recognition in Financial Statements” (“SAB
101"). A new company called FireLESS Ltd. was established and given
commercialization license. The Company received 30% equity in FireLESS Ltd in
addition to the one time license acquisition fee which was recorded as research
and development expense in accordance with ASC 730-10-25 “Accounting for
Research and Development Costs (See also Note 4).
The new
company will focus on acquiring the appropriate licenses and certificates to
internationally market FireSAFE and will work with local and international fire
agencies to test and establish usability baselines for FireSAFE. As of the date
of this prospectus we are comleting data analisys of independent testing
completed on FireSafe. Results of this analisys, expected to be completed by the
end of 2009, will determine the next course of action.
To
further these goals, by protecting the intellectual property FireSAFE
represents, on October 20, 2008 the Company filed a PCT patent application in
addition to the already filed Hungarain application to protect FireSAFE
internationally.
FireSAFE
is an environmentally friendly, biodegradable liquid designed to prevent, and if
necessary extinguish natural fires that are exceedingly hard, or impossible to
contain with water or other fire-fighting solutions. This category includes
forest, bush and other natural fires. FireSAFE reaches the heart of the fire,
coating all surfaces with a crystalline layer that hardens when exposed to heat.
The layer thus formed is capable of withstanding heat as high as 1,100 degrees
centigrade, enough to stop the most fearsome forest fires. Following use
(containment of the fire) the biodegradable active ingredient will decompose in
approximately four months. FireSAFE can also be used as a preventive
solution, both in the wild and in treating lumber. During fire season those
areas that are the most likely to be burnt can be sprayed with the solution as a
preventive measure. Lumber used in construction can also be treated with
FireSAFE to increase its fire resistance factor. FireSAFE can be manufactured
anywhere on the planet with ease as all its ingredients are widely and cheaply
available.
TothTelescope
On July
15, 2009 our exclusive distributor agreement expired with Attila Toth, Inventor
of the TothTelescope. After extensive review of the technology, the aavailable
market and hurdles associated with manufacturing and distributing the
TothTelescope, we have elected not to renew the distribution agreement and
discontinue the project. Since inception only 10 telescopes were sold. Owerall
invested capital was returned from commissions eared on these
sales.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
1 -
|
GENERAL
INFORMATION (Continued)
|
Yorkville
SEDA
On
October 8, 2008, Power of the Dream Ventures, Inc. (the “Company”) entered into
a Standby Equity Distribution Agreement (the “Standby Equity Distribution
Agreement”) with YA Global Investments, L.P. (the “Investor”). Pursuant to the
terms of the Standby Equity Distribution Agreement, the Company (a) agreed to
issue and sell to the Investor up to $5,000,000 of shares of the Company’s
common stock, par value $0.0001 per share (the “Common Stock”) in tranches of
equity, based upon a specified discount to the market price of the Common Stock,
calculated over the five trading days following notice by the Company of an
election to sell shares; and (b) issued to the Investor a warrant (the
“Warrant”) to purchase 4,027,386 shares of Common Stock at the exercise price
per share of $0.29. The Warrant is not part of the commitment shares issued by
the company to the investor. The investor must purchase the shares underlaying
the Warrant. The Warrant price was determined based upon the highest Bid price
on the day of the closing of the agreement.
In
connection with the Standby Equity Distribution Agreement, the Company entered
into a Registration Rights Agreement with the Investor (the “Registration Rights
Agreement”) pursuant to which the Company agreed to register for resale the
shares of Common Stock that may be purchased by the Investor pursuant to the
Standby Equity Distribution Agreement, the shares of Common Stock issuable upon
exercise of the Warrant and 2,000,000 shares of Common Stock (the “Commitment
Shares”) issued to the Investor as a commitment fee pursuant to the terms of the
Standby Equity Distribution Agreement. The commitment fee is recorded by
decreasing additional paid in capital.
Financing
from this transaction will be used by the Company for the continued development
of its current technologies, commercialization of same, the acquisition of new
technologies and for general corporate expenses.
The
Company filed the details of this transaction on Form 8-K with the Commission on
October 14, 2008.
As of the
date of this filing the company has not utilized any of the funds available
under the Standby Equity Distribution Agreement.
Genetic
Immunity
On
February 23, 2009 the Company entered into a consultation agreement with Genetic
Immunity, a Hungarian biotechnology research and development company working on
immune amplification nanomedicine products, including a HIV vaccine currently in
Phase 2 clinical trials.
According
to the terms of the agreement PDV will provide Genetic Immunity business
development expertise, will facilitate the publication, via internationally
distributed press releases, of Genetic Immunity’s past, present and future news
items, and will advise Genetic Immunity on going public in the United States
based on Power of the Dream Ventures’ own experience in achieving public
states.
In
addition, PDV was granted rights to acquire equity in Genetic Immunity in one or
several tranches for total consideration of USD $10 million in exchange for 20%
equity in the Company, if all options are exercised.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
1 -
|
GENERAL
INFORMATION (Continued)
|
Exact
terms of this equity purchase option are: PDV is to acquire 2% of the Company
via a USD 1,000,000 investment by April 30, 2009 in exchange for 72 units of the
Genetic Immunity’s Class B stock; Company is to acquire an additional 2% of the
Genetic Immunity via a USD 1,000,000 investment by August 30, 2009 in exchange
for 72 units of the Genetic Immunity’s Class B stock. PDV is also granted an
option to acquire an additional 16% of the Genetic Immunity via an $8,000,000
investment by February 20, 2010, in tranches or in whole, in exchange for 578
units of the Genetic Immunity’s Class B stock. If the Company misses the first
deadline of April 30, 2009 this agreement shall immediately terminate. If the
Company completes the first investment but missed the second date of August 30,
2009 this agreement shall terminate, but the Company will retain the Class B
units already acquired. Any portion of the optional 16% equity purchase that is
not exercised and closed by February 23, 2010 shall terminate. The option was
extended for an unlimited period.
As of the
date of this report the Company has not yet acquired any equity in Genetic
immunity but still intends to do so pending availability of sufficient capital.
As a direct result of this intention the original agreement is still if
effect.
Basis
of presentation
The
accompanying unaudited condensed consolidated financial statements have been
prepared by the Company pursuant to the rules and regulations of the SEC.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles generally accepted
in the United States of America for interim financial information have been
condensed or omitted pursuant to such rules and regulations. In the opinion of
management, the accompanying condensed financial statements include all
adjustments (consisting of normal recurring accruals) considered necessary to
make the financial statements not misleading as of and for the period ended
September 30, 2009 and for the period from April 26, 2006 (date of inception) to
September 30, 2009. Operating results for the nine month periods ended September
30, 2009 are not necessarily indicative of the results that may be expected for
the year ending December 31, 2009.
Going
Concern and Management’s Plan
The
accompanying unaudited condensed consolidated financial statements have been
prepared in conformity with accounting principles generally accepted in the
United States of America, which contemplate the continuation of the Company as a
going concern and assume realization of assets and the satisfaction of
liabilities in the normal course of business. The Company has incurred losses
from operations since inception. Management anticipates incurring additional
losses in 2009. Further, the Company may incur additional losses thereafter,
depending on its ability to generate revenues from the licensing or sale of its
technologies and products, or to enter into any or a sufficient number of joint
ventures. The Company has minimal revenue to date. There is no assurance that
the Company can successfully commercialize any of its technologies and products
and realize any revenues therefrom. The Company’s technologies and products have
never been utilized on a large-scale commercial basis and there is no assurance
that any of its technologies or products will receive market acceptance. There
is no assurance that the Company can continue to identify and acquire new
technologies.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
1 -
|
GENERAL
INFORMATION (Continued)
|
Since
inception through September 30, 2009, the Company had an accumulated deficit of
$7,442,530 and net cash used in operations of $1,816,535. However, management of
the Company believes that the funding from the October 2008 private placement of
the Company’s common shares (See Note 8) together with the anticipated raising
of additional capital will allow it to continue operations and execute its
business plan.
Management
believes the Company can raise adequate capital to keep the Company functioning
through September 30, 2010. However, no assurance can be given that the Company
can obtain additional working capital, or if obtained, that such funding will
not cause substantial dilution to shareholders of the Company. If the Company is
unable to raise additional funds, it may be forced to change or delay its
contemplated marketing and business plan. Being a development stage company, the
Company is subject to all the risks inherent in the establishment of a new
enterprise and the marketing and manufacturing of a new product, many of which
risks are beyond the control of the Company. All of the factors discussed above
raise substantial doubt about the Company’s ability to continue as a going
concern.
These
unaudited condensed consolidated financial statements do not include any
adjustments relating to the recoverability of recorded asset amounts that might
be necessary as a result of the above uncertainty.
NOTE
2 –
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
|
The
significant accounting policies adopted in preparation of the consolidated
financial statements are set out below.
Principles of
Consolidation
The
unaudited condensed consolidated financial statements include the accounts of
PDV and its wholly-owned Hungarian subsidiary, Vidatech. All significant
intercompany accounts and transactions have been eliminated in
consolidation.
Use of
Estimates:
The
preparation of the financial statements in conformity with US GAAP requires
management to make estimates, judgments and assumptions that affect amounts
reported herein. Management believes that such estimates, judgments and
assumptions are reasonable and appropriate. However, due to the inherent
uncertainty involved, actual results may differ from those based upon
management’s judgments, estimates and assumptions. Critical accounting policies
requiring the use of estimates are depreciation and amortization and share-based
payments
Revenue
Recognition:
Sales are
recognized when there is evidence of a sales agreement, the delivery of the
goods or services has occurred, the sales price is fixed or determinable and
collectability is reasonably assured, generally upon shipment of product to
customers and transfer of title under standard commercial terms. Sales are
measured based on the net amount billed to a customer. Generally there are no
formal customer acceptance requirements or further
obligations. Customers do not have a general right of return on
products shipped therefore no provisions are made for return.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
2 –
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
|
Accounts Receivable and
Allowance for Doubtful Accounts:
Accounts
receivable are stated at current value, which approximates fair value. The
Company does not require collateral for accounts receivable. Accounts receivable
are reduced by an allowance for amounts that may be uncollectible in the future.
This estimated allowance is determined by considering factors such as length of
time accounts are past due, historical experience of write offs, and customers’
financial condition.
Inventories:
Inventories
are stated at the lower of cost, determined based on weighted average cost or
market value. Inventories are reduced by an allowance for excess and obsolete
inventories based on management’s review of on-hand inventories compared to
historical and estimated future sales and usage.
Fixed
assets:
Fixed
assets are stated at cost or fair value for impaired assets. Depreciation and
amortization is computed principally by the straight-line method. Asset
amortization charges are recorded for long lived assets. In the related periods,
no asset impairment charges were accounted for.
Depreciation
is recorded commencing the date the assets are placed in service and is
calculated using the straight line basis over their estimated useful
lives.
The
estimated useful lives of the various classes of long-lived assets are
approximately 3-7 years.
Pensions and Other
Post-retirement Employee benefits:
In
Hungary, pensions are guaranteed and paid by the government or by pension funds,
therefore no pensions and other post-retirement employee benefit costs or
liabilities are to be calculated and accounted by the Company.
Product
warranty:
The
Company accrues for warranty obligations for products sold based on management
estimates, with support from sales, quality and legal functions, of the amount
that eventually will be required to settle such obligations. At September 30,
2009, the Company had no warranty obligations in connection with the products
sold.
Advertising
costs:
Advertising
and sales promotion expenses are expensed as incurred.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
2 –
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
|
Research and development and
Investment and Advances to Non-Consolidated Entities:
In
accordance with ASC 730-10-25 “Accounting for Research and Development Costs,”
all research and development (“R&D”) costs are expensed when they are
incurred, unless they are reimbursed under specific contracts. Assets used in
R&D activity, such as machinery, equipment, facilities and patents that have
alternative future use either in R&D activities or otherwise are
capitalized. In connection with investments and advances in development-stage
technology entities in which the company owns or controls less than a 50% voting
interest, (see Note 4) where repayment from such entity is based on the results
of the research and development having future economic benefit, the investment
and advances are accounted for as costs incurred by the Company as research and
development in accordance with ASC 730-20-25.
Income
taxes:
The
Company accounts for income taxes in accordance with ASC 740-10-25, “Accounting
for Income Taxes”. Deferred tax assets and liabilities are recognized for the
future tax consequences attributable to differences between financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases and operating loss and tax credit carry forwards. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled.
Valuation
allowances are provided against deferred tax assets to the extent that it is
more likely than not that the deferred tax assets will not be
realized.
Comprehensive Income
(Loss):
ASC
220-10-25, “Accounting for Comprehensive Income,” establishes rules for
reporting and disclosure of comprehensive income and its components (including
revenues, expenses, gains and losses) in a full set of general-purpose financial
statements. The items of other comprehensive income that are typically required
to be disclosed are foreign currency items, minimum pension liability
adjustments, and unrealized gains and losses on certain investments in debt and
equity securities. Accumulated other comprehensive income, at September 30, 2009
is $10,635.
Translation of Foreign
Currencies:
The U.S.
dollar is the functional currency for all of the Company’s businesses, except
its operations in Hungary. Foreign currency denominated assets and liabilities
for this unit is translated into U.S. dollars based on exchange rates prevailing
at the end of each period presented, and revenues and expenses are translated at
average exchange rates during the period presented. The effects of foreign
exchange gains and losses arising from these translations of assets and
liabilities are included as a component of equity, under other comprehensive
income.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
2 –
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
|
Loss per
Share:
Under ASC
260-10-45, “Earnings Per Share”, basic loss per common share is computed by
dividing the loss applicable to common stockholders by the weighted average
number of common shares assumed to be outstanding during the period of
computation. Diluted loss per common share is computed using the weighted
average number of common shares and, if dilutive, potential common shares
outstanding during the period. There were no common stock equivalents or
potentially dilutive securities outstanding during the years ended September 30,
2009 and 2008, respectively. Accordingly, the weighted average number of common
shares outstanding for the periods ended September 30, 2009 and 2008,
respectively, is the same for purposes of computing both basic and diluted net
income per share for such years.
Business
Segment:
ASC
280-10-45, “Disclosures About Segments of an Enterprise and Related
Information,” establishes standards for the way public enterprises report
information about operating segments in annual consolidated financial statements
and requires reporting of selected information about operating segments in
interim financial statements regarding products and services, geographical areas
and major customers. The Company has determined that under ASC 208-10-45, there
are no operating segments since substantially all business operations, assets
and liabilities are in Hungarian geographic segment.
Share-Based
Payments:
In
accordance with ASC 718-10 “Share-Based Payment” all forms of share-based
payment (“SBP”) awards including shares issued under employee stock purchase
plans, stock options, restricted stock and stock appreciation rights result in a
cost that is measured at fair value on the awards’ grant date, based on the
estimated number of awards that are expected to vest. As the Company did not
issue any employee SBP prior to September 30, 2007, there is no compensation
cost recognized in the accompanied consolidated financial
statements.
The
Company accounts for equity instruments issued to non-employees in accordance
with the provisions of ASC 505-50, “Accounting for Equity Instruments That Are
Issued to Other Than Employees for Acquiring, or in Conjunction with Selling,
Goods or Services,” which requires that such equity instruments are recorded at
their fair value on the measurement date. The measurement of stock-based
compensation is subject to periodic adjustment as the underlying equity
instrument vests. Non-employee stock-based compensation charges are amortized
over the vesting period or period of performance of the
services.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
2 –
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
|
Recent Accounting
Pronouncements:
In
December 2007, the FASB issued ASC 805-10-15, “Business Combinations” (“SFAS
141(R)”). It expands on the disclosures previously required by SFAS 141, better
defines the acquirer and the acquisition date in a business combination, and
establishes principles for recognizing and measuring the assets acquired
(including goodwill), the liabilities assumed and any non-controlling interests
in the acquired business. ASC 805-10-15 also requires an acquirer to record an
adjustment to income tax expense for changes in valuation allowances or
uncertain tax positions related to acquired businesses. ASC 805-10-15 is
effective for all business combinations with an acquisition date in the first
annual period following December 15, 2008; early adoption is not permitted. We
adopted this statement as of January 1, 2009. Adoption of ASC 805-10-15 did not
have a material impact on the Company’s consolidated financial position, results
of operations or cash flows.
In
December 2007, the FASB issued ASC 810-10-65, “Non-controlling Interests in
Consolidated Financial Statements-an amendment of ARB No. 51”. ASC 810-10-65
requires that non-controlling (or minority) interests in subsidiaries be
reported in the equity section of the company’s balance sheet, rather than in a
mezzanine section of the balance sheet between liabilities and equity. ASC
810-10-65 also changes the manner in which the net income of the subsidiary is
reported and disclosed in the controlling company’s income statement. ASC
810-10-65 also establishes guidelines for accounting or changes in ownership
percentages and for deconsolidation. ASC 810-10-65 is effective for financial
statements for fiscal years beginning on or after December 15, 2008 and interim
periods within those years. The adoption of ASC 810-10-65 did not have a
material impact on our financial position, results of operations or cash
flows.
In March
2008, the FASB issued ASC 815-10-65, “Disclosures about Derivative Instruments
and Hedging Activities-an amendment of FASB Statement No. 133”. ASC 815-10-65
requires enhanced disclosures about an entity’s derivative and hedging
activities and thereby improves the transparency of financial reporting. ASC
815-10-65 is effective for financial statements issued for fiscal years and
interim periods beginning after November 15, 2008, with early application
encouraged. The adoption of ASC 815-10-65 did not have a material impact on our
financial position, results of operations or cash flows.
In March
2008, the FASB issued SFAS No. 162, The Hierarchy of Generally Accepted
Accounting Principles. This statement identifies the sources of accounting
principles and the framework for selecting the principles to be used in the
preparation of financial statements of nongovernmental entities that are
presented in conformity with US GAAP. This statement is effective 60 days
following the SEC’s approval of the Public Company Accounting Oversight Board
amendments to AU Section 411, The Meaning of Present Fairly in Conformity With
Generally Accepted Accounting Principles.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
2 –
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
|
Effective
January 1, 2009, the Company adopted ASC 470-20 "Accounting for Convertible Debt
Instruments that may be settled in Cash upon Conversion (Including Partial Cash
Settlement)“. ASC 470-20 requires the issuer of certain convertible
debt instruments that may be settled in cash (or other assets) on conversion to
separately account for the liability (debt) and equity (conversion option)
components of the instrument in a manner that reflects the issuer's
non-convertible debt borrowing rate. ASC 470-20 is effective for
fiscal years beginning after December 15, 2008 on a retroactive
basis. This interpretation did not affect the consolidated financial
position or results of operations.
Effective
January 1, 2009, the Company adopted the ASC 260-10, “Determining Whether
Instruments Granted in Share-Based Payment Transactions are Participating
Securities”. This required that all unvested share-based payment
awards that contain nonforfeitable rights to dividends should be included in the
basic Earnings Per Share (EPS) calculation. This standard did not
affect the consolidated financial position or results of
operations.
Effective
April 1, 2009, the Company adopted ASC 320-10-65, “Recognition and Presentation
of Other-Than-Temporary Impairments”. ASC 320-10-65 provides guidance in
determining whether impairments in debt securities are other than temporary, and
modifies the presentation and disclosures surrounding such instruments. This is
effective for interim periods ending after June 15, 2009, but early adoption is
permitted for interim periods ending after March 15, 2009. This standard did not
affect the consolidated financial position or results of
operations.
Effective
April 1, 2009, the Company adopted ASC 820-10-65, “Determining Fair Value When
the Volume and Level of Activity for the Asset or Liability Have Significantly
Decreased and Identifying Transactions That Are Not Orderly”. ASC 820-10-65
provides additional guidance in determining whether the market for a financial
asset is not active and a transaction is not distressed for fair value
measurement purposes as defined in ASC 820-10-55, “Fair Value Measurements.” ASC
820-10-65 is effective for interim periods ending after June 15, 2009, but early
adoption is permitted for interim periods ending after March 15, 2009. This
standard did not affect the consolidated financial position or results of
operations.
Effective
April 1, 2009 the Company adopted ASC 825-10-65, “Interim Disclosures about Fair
Value of Financial Instruments”. This amends ASC 820-10-55, “Disclosures about
Fair Values of Financial Instruments,” to require disclosures about fair value
of financial instruments in interim financial statements as well as in annual
financial statements. It also amends ASC 270-10, “Interim Financial Reporting,”
to require those disclosures in all interim financial statements. This standard
did not affect the consolidated financial position or results of
operations.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
2 –
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
|
In May
2009, FASB issued ASC 855-10, Subsequent Events. The standard introduces the
concept of financial statements being available to be issued. It requires the
disclosure of the date through which an entity has evaluated subsequent events
and the basis for that date, that is, whether that date represents the date the
financial statements were issued or were available to be issued. In accordance
with this statement, an entity should apply the requirements to interim or
annual financial periods ending after June 15, 2009. Management performed an
evaluation of the Company’s activities through the time of filing this Quarterly
Report on Form 10-Q on November 3, 2009, and has concluded that there are no
significant subsequent events requiring recognition or disclosure in these
consolidated financial statements.
In June
2009, FASB issued SFAS No. 167, an amendment to FASB Interpretation No. 46(R).
This Statement amends Interpretation 46(R) to require an enterprise to perform
an analysis to determine whether the enterprise’s variable interest or interests
give it a controlling financial interest in a variable interest entity. This
analysis identifies the primary beneficiary of a variable interest entity as the
enterprise that has several defined characteristics. Additionally, an enterprise
is required to assess whether it has an implicit financial responsibility to
ensure that a variable interest entity operates as designed when determining
whether it has the power to direct the activities of the variable interest
entity that most significantly impact the entity’s economic performance. This
amendment shall be effective as of the beginning of each reporting entity’s
first annual reporting period that begins after November 15, 2009, for interim
periods within that first annual reporting period, and for interim and annual
reporting periods thereafter. Earlier application is prohibited. The
adoption of is not expected to this interpretation have a material impact on our
financial position, results of operations or cash flows.
In June
2009, FASB issued ASC 105-10, The FASB Accounting Standards Codification and the
Hierarchy of Generally Accepted Accounting Principles—a replacement of FASB
Statement No. 162. The FASB Accounting Standards Codification (Codification)
became 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. 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 became nonauthoritative.
This Statement is effective for financial statements issued for interim and
annual periods ending after September 15, 2009. The Company adopted this
requirement.
NOTE
3 -
|
OTHER
RECEIVABLES
|
September 30,
2009
|
December 31,
2008
|
|||||||
VAT
reclaimable
|
$ | 15,984 | $ | 20,214 | ||||
Advances
given
|
682 | 668 | ||||||
Other
|
9,147 | 4,249 | ||||||
Total
|
$ | 25,813 | $ | 25,131 |
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
4 -
|
RESEARCH
AND DEVELOPMENT (“R&D”)
|
In
August, 2008, the Company entered into an agreement with a Hungarian individual
to establish FireLESS Kft (FireLESS). FireLESS’s business is focused on
acquiring the appropriate licenses and certificates to internationally market
FireSAFE and will work with local and international fire agencies to test and
establish usability baselines for FireSAFE. The Company is a minority
shareholder in FireLESS with 30% voting rights, which operates under independent
management.
In
August, 2007, the Company entered into an agreement with two Hungarian
individuals to establish In4 Kft (“in4). In4’s business is focused on software
development and information technology purposes. The Company is a minority
shareholder in in4 with 30% voting rights, which operates under independent
management.
In
August, 2007, the Company also entered into a loan commitment agreement with
in4. According to the agreement the Company has committed a loan of
approximately $271,000 to in4. In November of 2008 the Company transferred to
in4 the entire loan amount, upon which the Company elected to covert the loan
into an additional 10% equity in in4. Since January 15, 2009 the Company
maintains a minority position of 40% equity in in4 Ltd. Since capitalization of
the loan to equity the Company has provided an additional $205,000 loan to
in4.
Since the
repayment of loans, advances and other investment is contingent on the results
of the R&D of iGlue having future economic benefit, management has expensed
the Company's investment in in4 and in FireLESS of approximately $5,000 and
$900, respectively and loan to in4 of approximately $330,000 as R&D in the
accompanying condensed consolidated statements of operations, in accordance with
ASC 730-10-25 "Research and Development Arrangements".
On 16
January, 2008, the Company entered into an Invention Transfer Agreement (“ITA”)
with Otto Buresch, a Hungarian individual (“Inventor”). The purpose of the
agreement is to transfer to the Company the exclusive right of utilizing for
technology capable of mixing water with gasoline, in 40% to 60 %, for use in
internal combustion engines. The purchase price of the invention was HUF
1,750,000 (approximately $10,000) The Company will patent the invention and will
become its owner. Following successful commercialization the inventor is
entitled to receive 40% of net revenue.
NOTE
5 -
|
FIXED
ASSETS
|
Net
property and equipment consisted of the followings at September 30, 2009 and
December 31, 2008, respectively:
September 30,
2009
|
December 31,
2008
|
|||||||
Machinery
and equipment
|
$ | 69,406 | $ | 68,026 | ||||
Vehicles
|
490,689 | 582,087 | ||||||
Office
equipment
|
76,039 | 46,646 | ||||||
Software
and website registration rights
|
40,285 | 22,252 | ||||||
Total
|
676,419 | 719,011 | ||||||
Less:
Accumulated depreciation and amortization
|
(180,380 | ) | (104,288 | ) | ||||
Net
property and equipment
|
$ | 496,039 | $ | 614,723 |
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The net
book value of fixed assets under capital lease amount to $384,405 and $516,188
at September 30, 2009 and at December 31, 2008, respectively. The decrease is
due to the sale of one leased car.
NOTE
6 -
|
NOTE
PAYABLE
|
On April
10, 2007, in connection with reverse merger (See Note 1), the Company assumed a
note payable of $250,000 to a former stockholder, Mary Passalaqua originally
with one year maturity at April 5, 2008. The note has been expanded by one year
to April 5, 2009 with the same conditions. As such note payable was issued
immediately prior to the reverse merger, such issuance was recorded as
additional compensation by the Company prior to the reverse merger. Accordingly,
such compensation is reflected in the accompanying consolidated balance sheet as
the accumulated deficit of the Company, and will not be reflected in the
Statement of operations, as such compensation expense was structured as an
expense prior to the recapitalization.
In
November, 2008 the Company settled $35,000 and in May 2009 $20,000 from the
outstanding liability. The note payable bears interest at the prime rate (3.25%
at September 30, 2009). Interest expense in connection with such note amounted
to $32,251 and $27,010 for the periods ended at September 30, 2009 and at
December 31, 2008, respectively, and was accrued and included in accounts
payable and accrued liabilities in the accompanying consolidated balance
sheet.
NOTE
7 -
|
CAPITAL
LEASES PAYABLE
|
In
August, 2007, the Company entered into capital lease agreements on 3 vehicles
for management purposes. The maturity of the lease is 60 months and is
denominated in CHF. Instalments and interest is due on a monthly basis. In
December, 2007, the Company entered into additional capital lease agreements on
2 vehicles for management purposes. The maturity of the lease is 72 months and
is denominated in CHF. Installments and interest is due on a monthly
basis.
In
December 2008, the Company settled the capital lease agreements on 2 vehicles
and replaced them with new agreements for additional 2 vehicles, totaling 5
capital lease agreements at December 31, 2008. The maturity of the new leases
varies from 60 to 72 months and are denominated in EUR and CHF. Installments and
interests are due on a monthly basis.
In
September 2009, the Company closed a capital lease agreement for one car. The
related asset has been sold.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The
following is a schedule by years of future minimum lease payments under capital
leases together with the present value of the net minimum lease payments as of
September 30, 2009:
For
the year ending September 30, 2009
|
Amounts
|
|||
2009
|
$ | 22,556 | ||
2010
|
90,224 | |||
2011
|
90,224 | |||
2012
|
90,224 | |||
2013
|
88,716 | |||
2014
|
27,649 | |||
Total
minimum lease payments
|
$ | 409,593 | ||
Less:
amounts representing interest
|
$ | 92,496 | ||
Present
value of net minimum lease payments
|
$ | 317,097 | ||
Less:
current portion
|
59,442 | |||
Long
term liability
|
$ | 267,655 |
NOTE
8 -
|
STOCKHOLDERS’
EQUITY
|
In April
2009, the Company entered into an agreement with two professionals for
consulting services. According to the agreement the professionals provided
consulting services to the Company in 2009. In connection with these services,
the Company issued to them 250,000 shares of the Company’s common stock. These
share issuances were recorded at $0.4 per share in the total amount of $100,000
and the related expense was recorded under general administration.
On
February 5, 2009, the Company entered into a restricted stock agreement with
Ildiko Rozsa, who is to serve as the Chief Financial Officer of the Company. As
part of the agreement Ms. Rozsa was granted 120,000 shares of the Company’s
restricted common stock of which 30,000 shares will vest quarterly, at the end
of each quarter, so long as Ms. Rozsa is employed by the Company.
On
February 5, 2009, the Company entered into a restricted stock agreement with
Szilvia Toth, the Chief Accounting Officer of the Company. As part of the
agreement Ms. Toth was granted 120,000 shares of restricted common stock, of
which 30,000 shares will vest quarterly, at the end of each quarter, so long as
Ms. Toth is employed by the Company.
On
February 5, 2009, the Company entered into a restricted stock agreement with
Mihaly Zala, the Chief Technology Officer of the Company. As part of the
agreement Mr. Zala was granted 120,000 shares of restricted common stock, which
will vest on equal installments of 30,000 shares quarterly, at the end of each
quarter, so long as Mr. Zala is employed by the Company. As of July 15, 2009 Mr.
Zala is no longer employed by the Company, therefore 60,000 shares of the
120,000 granted to him were cancelled and returned to the authorized and
unissued stock of the company.
On
February 5, 2009, the Company entered into a restricted stock agreement with
Imre Eotvos, the Technology Assistant of the Company. As part of the agreement
Mr. Eotvos was granted 200,000 shares of restricted common stock, which will
vest on equal installments of 50,000 shares quarterly, at the end of each
quarter, so long as Mr. Eotvos is employed by the Company.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
8 -
|
STOCKHOLDERS’
EQUITY (Continued)
|
On
February 5, 2009, the Company entered into a restricted stock agreement with
Daniel Kun, Jr., who is to serve as Secretary and Vice President of the company
on a going forward basis. As part of the agreement Mr. Kun was granted 200,000
shares of restricted common stock, which will vest on equal installments of
50,000 shares quarterly, at the end of each quarter, so long as Mr. Kun is
employed by the Company.
As
consideration for the above services, the Company issued an aggregate of 700,000
shares of the Company’s common stock. These share issuances were recorded at
$0.4 per share in the total amount of $280,000 in accordance with measurement
date principles prescribed under FAS 123 (R).
On
October 8, 2008, Power of the Dream Ventures, Inc. (the “Company”) entered into
a Standby Equity Distribution Agreement (the “Standby Equity Distribution
Agreement”) with YA Global Investments, L.P. (the “Investor”). Pursuant to the
terms of the Standby Equity Distribution Agreement, the Company (a) agreed to
issue and sell to the Investor up to $5,000,000 of shares of the Company’s
common stock, par value $0.0001 per share (the “Common Stock”) in tranches of
equity, based upon a 7% discount to the market price of the Common Stock,
calculated over the five trading days following notice by the Company of an
election to sell shares; and (b) issued to the Investor a warrant (the
“Warrant”) to purchase 4,027,386 shares of Common Stock at the exercise price
per share of $0.29. The Warrant is not part of the commitment shares issued by
the company to the investor.
The
investor must purchase the shares underlaying the Warrant. The Warrant price was
determined based upon the highest Bid price on the day of the closing of the
agreement. The YA Global is required to exercise thewarrant upon notice by PDV
of an election to have the warrants exercised at a fix price of $0.29 per common
stock.
In
connection with the Standby Equity Distribution Agreement, the Company entered
into a Registration Rights Agreement with the Investor (the “Registration Rights
Agreement”) pursuant to which the Company agreed to register for resale the
shares of Common Stock that may be purchased by the Investor pursuant to the
Standby Equity Distribution Agreement, the shares of Common Stock issuable upon
exercise of the Warrant and 2,000,000 shares of Common Stock (the “Commitment
Shares”) issued to the Investor as a commitment fee pursuant to the terms of the
Standby Equity Distribution Agreement. The 2,000,000 shares issued as a
commitment fee were valued at $0.4 per share or $800,000 based on the fair value
at issuance date. The $800,000 commitment fee has been debited
against additional paid in capital in accordance with the provisions of Staff
Accounting Bulletin Topic 5A .
There is
no limit to the amount of each advance. We are not obligated to utilize any of
the $5.0 million available under the SEDA and there are no minimum commitments
or minimum use penalties. Based upon our outstanding shares of common stock, and
warrants to purchase common stock as of December 31, 2008, there is no limit on
the number of share we may issue without stockholder approval. Based on the
price of our stock at September 30, 2009, the maximum number of shares that
could be sold under this agreement is approximately 33,333,333
shares.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
8 -
|
STOCKHOLDERS’
EQUITY (Continued)
|
On May
17, 2008 the Company entered into an agreement with Wakabayashi Fund LLC in
order to arrange financing for working capital as an intermediary. Wakabayashi
Fund LLC provided capital funding services including serving as an investment
banking liaison and acted as capital consultant for a six month period. The
Company issued 111,111 shares of restricted common stock upfront at $1.35 per
share, the market price of the stock on the commitment date of the agreement.
Additionally, the Company agreed to pay for the capital funding services 7%
success fee. These share issuances were recorded at $1.35 per share in the total
amount of $150,000 in accordance with measurement date principles prescribed
under ASC 505-50. The Company is amortizing the fair value of the shares in
general and administration expenses over the term of the agreement to
stock-based compensation expense, which amounted to $0 for the period ended
September 30, 2009 and $150,000 for the period from April 26, 2006 (date of
inception) to September 30, 2009, in accordance with ASC 505-50. As of November
17, 2008 this agreement has been terminated without any funds
raised.
On April
18, 2008 the Company entered an agreement with RedChip Companies Inc. and
Partner Media4Equity Inc. for an investor relationship program for a period of
12 months. The Company secured and delivered 306,570 restricted common shares
with a market price of $0.70 for a 12 months period in connection with RedChip
investor relationship services. The compensation for Media4Equity services was
the delivery of 1,500,000 restricted common shares. These share issuances were
recorded at $0.75 per share, the market price of the stock on the commitment
date of the agreement, for a total amount of $1,125,000 in accordance with
measurement date principles prescribed under ASC 505-50. The Company is
amortizing the fair value of the shares in general and administration expenses
over the term of the agreement to stock-based compensation expense, which
amounted to $63,498 and $792,123 for the periods ended September 30, 2009 and
December 31, 2008, respectively and $1,339,599 for the period from April 26,
2006 (date of inception) to September 30, 2009, in accordance with ASC
505-50.
As of
December 31, 2008, we had estimated unrecognized stock-based compensation
expense of $403,458 related to nonvested restricted stock awards and
units. This expense is expected to be recognized over a
weighted-average period of 1 year.
In
October 2008, pursuant to a private placement under Regulation S of the
Securities Act of 1933, as amended, the Company sold 2,500,000 shares of its
common stock at $0.4 per share for aggregate proceeds of
$1,000,000.
In
February of 2008, shares of common stock of the Company have been approved by
FINRA for quotation and trading on the Over The Counter Bulletin Board (OTCBB)
under the ticker symbol PWRV. Trading commenced in the Company’s securities on
the OTCBB beginning on February 21, 2008.
In
January 2008, pursuant to a private placement under Regulation S of the
Securities Act of 1933, as amended, the Company sold 32,500 shares of its common
stock at $3.25 per share for aggregate proceeds of $105,625.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
8 -
|
STOCKHOLDERS’
EQUITY (Continued)
|
In
October 2007, pursuant to a private placement under Regulation S of the
Securities Act of 1933, as amended, the Company sold 104,000 shares of its
common stock at $2.50 per share for aggregate proceeds of $260,000. The Company
also entered into a Registration Rights Agreement, pursuant to which it agreed
that as soon as practicable from the Offering Termination Date, as defined in
the Registration Rights Agreement, it would file a registration statement with
the SEC covering the resale of the shares of the Company’s common stock that are
issuable pursuant to this private placement. There are no stipulated damages
outlined in the Registration Rights Agreement for failure to file within the
agreed upon time frame. Under such agreement, the holder is entitled to exercise
all rights granted by law, including recovery of damages under this
agreement.
The
Company filed Form SB-2 a registration statement with SEC on November 14, 2007,
which was approved on January 30, 2008.
On
October 24, 2007, the Company entered into a restricted stock agreement with
Ildiko Rozsa, who is to serve as the Chief Financial Officer of the Company. As
part of the agreement Ms. Rozsa was granted 250,000 shares of the Company’s
restricted common stock of which 100,000 shares are vested upon grant and 30,000
shares will vest quarterly, at the end of each quarter, so long as Ms. Rozsa is
employed by the Company.
On
October 1, 2007, the Company entered into a restricted stock agreement with
Szilvia Toth, the Chief Accounting Officer of the Company. As part of the
agreement Ms. Toth was granted 100,000 shares of restricted common stock of
which 50,000 shares are vested upon grant and 10,000 shares will vest quarterly,
at the end of each quarter, so long as Ms. Toth is employed by the
Company.
On
October 24, 2007, the Company entered into a restricted stock agreement with
Mihaly Zala, the Chief Technology Officer of the Company. As part of the
agreement Mr. Zala was granted 150,000 shares of restricted common stock, which
will vest on equal installments of 30,000 shares quarterly, at the end of each
quarter, so long as Mr. Zala is employed by the Company.
On
October 24, 2007, the Company entered into a restricted stock agreement with
Imre Eotvos, the Technology Assistant of the Company. As part of the agreement
Mr. Eotvos was granted 25,000 shares of restricted common stock, which will vest
on equal installments of 5,000 shares quarterly, at the end of each quarter, so
long as Mr. Eotvos is employed by the Company.
On
October 1, 2007, the Company entered into a restricted stock agreement with
Sandorne Juhasz, who provides payroll accounting services to the Company on a
subcontracting basis. As part of the agreement Ms. Juhasz was granted 11,000
shares of restricted common stock, of which 8,000 is will vest upon grant and
750 shares will vest quarterly, at the end of each quarter, so long as Ms.
Juhasz is employed by the Company.
On
October 24, 2007, the Company entered into a restricted stock agreement with
Daniel Kun, Jr., who is to serve as Secretary and Vice President of the company
on a going forward basis. As part of the agreement Mr. Kun was granted 250,000
shares of restricted common stock, which will vest on equal installments of
50,000 shares quarterly, at the end of each quarter, so long as Mr. Kun is
employed by the Company.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
8 -
|
STOCKHOLDERS’
EQUITY (Continued)
|
On
October 24, 2007, the Company entered into a restricted stock agreement with
Viktor Rozsnyay, who is serving as President and Chief Executive Officer of the
Company. As part of the agreement Mr. Rozsnyay was granted 250,000 shares of
restricted common stock, which will vest on equal installments of 50,000 shares
quarterly, at the end of each quarter, so long as Mr. Rozsnyay is employed by
the Company.
As
consideration for the above services for the employment of the above 7 persons,
the Company issued an aggregate of 1,036,000 shares of the Company’s common
stock. These share issuances were recorded at $2.5 per share in the total amount
of $2,590,000 in accordance with measurement date principles prescribed under
ASC 505-50 and ASC 718-10. The Company is amortizing the fair value of the
shares over the term of the agreement to stock-based compensation expense, which
amounted to $0 for the period ended September 30, 2009 and $2,590,000 for the
period from April 26, 2006 (date of inception) to September 30, 2009, in
accordance with ASC 505-50 and ASC 718-10.
In June
2007, pursuant to a private placement under Regulation S of the Securities Act
of 1933, as amended, the Company sold 2,250,000 shares of its common stocks at
$0.34 per share for a total subscription receivable of $765,000. The Company
also entered into a Registration Rights Agreement, pursuant to which it agreed
that as soon as practicable from the Offering Termination Date, as defined in
the Registration Rights Agreement, it would file a registration statement with
the SEC covering the resale of the shares of the Company’s common stock that are
issuable pursuant to this private placement. There are no stipulated damages
outlined in the Registration Rights Agreement for failure to file within the
agreed upon time frame. Under such agreement, the holder is entitled to exercise
all rights granted by law, including recovery of damages under this agreement.
In June 2007, the Company entered into five consulting agreements with five
consultants for 12 to 24 month periods. According to the agreements the
consultants will provide general business consulting services. As consideration
for such services, the Company issued an aggregate of 1,375,000 shares of the
Company’s common stock. These share issuances were recorded at $0.34 per share
in the total amount of $467,501 in accordance with measurement date principles
prescribed under ASC 505-50 and ASC 718-10. The Company is amortizing the fair
value of the shares over the term of the agreement to stock-based compensation
expense, which amounted to $7,083 for the period ended September 30, 2009,
respectively and $467,501 for the period from April 26, 2006 (date of inception)
to September 30, 2009, in accordance with ASC 505-50 and ASC
718-10.
On April
10, 2007, PDV entered into a reverse merger transaction with Vidatech. In
connection with the merger 2,500,000 shares of PDV common stock remained
outstanding and PDV issued 33,300,000 shares of its common stock for all the
outstanding common stock of Vidatech. As a result of this transaction, the
former stockholders of Vidatech became the controlling stockholders of PDV.
Accordingly, the reverse merger has been accounted for as a recapitalization of
Vidatech.
In April
2007, the Company entered into an agreement with two professionals for legal
services. According to the agreement the professionals provided legal services
to the Company in 2007. In connection with these services, the Company issued to
them 500,000 shares of the Company’s common stock. These share issuances were
recorded at $0.34 per share in the total amount of $170,000 and the related
expense was recorded under general administration.
POWER
OF THE DREAM VENTURES, INC. (formerly TIA V, Inc.)
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE
8 -
|
STOCKHOLDERS’
EQUITY (Continued)
|
In
connection with the ITA (See Note 4), the Company issued 100,000 shares of the
Company’s common stock to the Inventors. These shares issuance were recorded at
fair value of $0.34 per share in the total amount of $34,000. The cost of the
related invention was recorded as research and development expense.
In May,
2006, the Company entered into a short term loan agreement with its Chief
Executive Officer, Viktor Rozsnyay, for approximately $96,100 with a maturity of
April 30, 2007. On December 28, 2006 Mr. Rozsnyay elected to convert the loan
into equity, which is recorded as additional paid in capital.
In March,
2007, the Company entered into a short term loan agreement with its Chief
Financial Officer, Daniel Kun Jr., for approximately $53,735 with a maturity of
March 31, 2007. On March 31, 2007 Mr. Kun elected to convert the loan into
equity, which is recorded as additional paid in capital.
NOTE
8 -
|
SUBSEQUENT
EVENTS
|
On
October 30, 2009 we entered into an invention transfer termination agreement
with Otto Buresch, inventor of our Desalination and H2OGas technologies. After
conducting extensive research into both topics, review of current market
conditions, potential competitors in fields associated with the inventions,
consideration of ‘state of readiness’ of our other technologies under
development and the resources needed to complete those technologies, we have
decided to forgo any further development of both Buresch
inventions.
We
determined that the amount of capital needed, the basic research and follow on
engineering required exceeded our currently available means. Our priority at the
moment is the completion and release of those technologies that show the most
promise, and have been developed the furthest since inception of the company. We
deem these to be our iGlue internet search and content organizer application via
an equity interest in In4, Ltd, and RiverPower.
We
believe that the discountinuation of the Buresch inventions will not result in
an substantial effect on company valuation and loss in shareholder value. In
fact the streamlining of our operations and the refocusing of our efforts on the
most readily achievable technology milestones will in fact enhance shareholder
value. Once one or more of our focus technoliges have been successfully divested
we can once again work on diversifying our technology portfolio with more
available resources.
PLAN
OF OPERATION
|
Overview
We were
incorporated in Delaware on August 17, 2006, under the name Tia V, Inc. Since
inception, and prior to our acquisition of Vidatech on April 10, 2007, we were
engaged solely in organizational efforts and obtaining initial financing. Our
sole business purpose was to identify, evaluate and complete a business
combination with an operating company.
On April
10, 2007, we completed our acquisition of Vidatech, Kft (also know as Vidatech
Technological Research and Development LLC) a limited liability company formed
under the laws of the Republic of Hungary. Vidatech is a company formed for the
purpose of investing in, acquiring, developing, licensing, and commercializing
technologies developed in Hungary. In furtherance of its business, Vidatech
provides research and development services to the companies from which it
acquires technologies or participation interests in such technologies. Prior to
December 31, 2007, Vidatech was primarily focused on organizational and capital
raising activities. Through September 30, 2009, we have had only limited
operations and acquired rights to eleven technologies, TothTelescope,
RiverPower, revolutionary desalination technology based on cavitation, H2OGas
for the mixing of water and gasoline for use in internal combustion engines, and
the Kalmar inventions (FireSAFE, technology for utilizing communal waste as a
concrete additive, technology for repairing potholes with the use of recycled
plastics, PVC shielded electric cable recycling technology, a biodegreadable
deicing liquid, and technology for the neutralization of red-mud, a toxic
byproduct of the aluminum/bauxite industry) and an equity interest in ‘in4 Kft’,
a company formed to develop next generation semantic search and content
organizer technology. All of these technologies are still in the development
stage (see Note 4). As of September 30, 2009, the Company has only realized
limited revenues from the TothTelescope project and has not realized any
revenues from the other inventions. As of , 2009 the TothTelescope project has
been discontinued.
We now
operate in Hungary through our wholly owned subsidiary, Vidatech Kft., a
Hungarian company. Our office in Hungary is located at 1095 Budapest, Soroksari
ut 94-96, Hungary.
Description
of our Business and Properties
Through
Vidatech, we aim to provide pro-active support for idea, research, start-up and
expansion-stage technology companies having rights to technologies or
intellectual properties which we believe to be potentially commercially viable,
by offering a range of services designed to encourage and protect the continuing
development and eventual commercialization of those technologies.
Our focus
will be on technologies and technology companies based in the Republic of
Hungary. We believe that the availability of technologies for purchase or
license, coupled with the lack of sufficient investment capital for such
technologies in Hungary, present us with an opportunity to acquire technologies
on terms and conditions that we deem advantageous.
Our
strategy is to acquire majority interests in technologies through, among other
things, direct investment in start-up and expansion stage technologies and
technology companies; cooperative research and development agreements with such
companies; direct licensing agreements; joint venture arrangements; or, direct
acquisition of technologies and intellectual properties.
ITEM
2 –
|
PLAN
OF OPERATION (Continued)
|
We also
intend to provide services to assist in:
|
-
The design of, research of, building of and testing of
prototypes;
|
|
-
facilitation of preparation of filing and prosecution of patent
applications with Hungarian patent
attorneys;
|
|
-
business structuring;
|
|
-
financing of research and development
activities;
|
|
-
the exposure of the technology to international markets;
and
|
|
-
the commercialization and/or sale of the subject
technology.
|
We expect
to obtain a majority participation interest in any given transaction involving
idea, research, seed, start-up, early stage, technologies.
Capital
Resources and Liquidity
In June
2007, pursuant to a private placement under Regulation S of the Securities Act
of 1933, as amended, the Company sold 2,250,000 shares of its common stock at
$0.34 for aggregate proceeds of $765,000.
Subsequently,
on October 12, 2007, we completed a second private placement under Regulation S
of the Securities Act of 1933, as amended, pursuant to which the Company sold
104,000 shares of its common stock at $2.50 per share for aggregate proceeds of
$260,000.
In
January 2008, pursuant to a private placement under Regulation S of the
Securities Act of 1933, as amended, the Company sold 32,500 shares of its common
stock at $3.25 per share for aggregate proceeds of $105,625.
In
October 2008, pursuant to a private placement under Regulation S of the
Securities Act of 1933, as amended, the Company sold 2,500,000 shares of its
common stock at $0.4 per share for aggregate proceeds of
$1,000,000.
On
September 30, 2009, the Company had a deficit in working capital of
$328,470.
FireSAFE
technology
On August
20, 2008, the Company licensed its FireSAFE technology to a group of Hungarian
investors for a license acquisition fee of HUF 20,000,000 (approximately
$120,000). A new company called FireLESS Ltd. was established and given
commercialization license. The Company received 30% equity in FireLESS
Ltd.
The new
company will focus on acquiring the appropriate licenses and certificates to
internationally market FireSAFE and will work with local and international fire
agencies to test and establish usability baselines for FireSAFE.
As of the
date of this prospectus we are comleting data analisys of independent testing
completed on FireSafe. Results of this analisys, expected to be completed by the
end of 2009, will determine the next course of action.
ITEM
2 –
|
PLAN
OF OPERATION (Continued)
|
To
further these goals on October 20, 2008 The Company filed a PCT patent
application to protect FireSAFE internationally.
FireSAFE
is an environmentally friendly, biodegradable liquid designed to prevent, and if
necessary extinguish natural fires that are exceedingly hard, or impossible to
contain with water or other fire-fighting solutions. This category includes
forest, bush and other natural fires. FireSAFE reaches the heart of the fire,
coating all surfaces with a crystalline layer that hardens when exposed to heat.
The layer thus formed is capable of withstanding heat as high as 1,100 degrees
centigrade, enough to stop the most fearsome forest fires. Following use
(containment of the fire) the biodegradable active ingredient will decompose in
approximately four months. FireSAFE can also be used as a preventive
solution, both in the wild and in treating lumber. During fire season those
areas that are the most likely to be burnt can be sprayed with the solution as a
preventive measure. Lumber used in construction can also be treated with
FireSAFE to increase its fire resistance factor. FireSAFE can be manufactured
anywhere on the planet with ease as all its ingredients are widely and cheaply
available.
As of
September 30, 2009 we have completed an independent technology testing and
verification process with LireLess Ltd. and local fire departments. Data
gathered in these extensive tests is being analysed in cooperation to determine
the best course of action for FireSafe on a going forward basis. We expect to
complete this data analysis in the third quarter of 2009 and report on results
when they become available.
Financing
from Yorkville SEDA
On
October 8, 2008, Power of the Dream Ventures, Inc. (the “Company”) entered into
a Standby Equity Distribution Agreement (the “Standby Equity Distribution
Agreement”) with YA Global Investments, L.P. (the “Investor”). Pursuant to the
terms of the Standby Equity Distribution Agreement, the Company (a) agreed to
issue and sell to the Investor up to $5,000,000 of shares of the Company’s
common stock, par value $0.0001 per share (the “Common Stock”) in tranches of
equity, based upon a specified discount to the market price of the Common Stock,
calculated over the five trading days following notice by the Company of an
election to sell shares; and (b) issued to the Investor a warrant (the
“Warrant”) to purchase 4,027,386 shares of Common Stock at the exercise price
per share of $0.29.
In
connection with the Standby Equity Distribution Agreement, the Company entered
into a Registration Rights Agreement with the Investor (the “Registration Rights
Agreement”) pursuant to which the Company agreed to register for resale the
shares of Common Stock that may be purchased by the Investor pursuant to the
Standby Equity Distribution Agreement, the shares of Common Stock issuable upon
exercise of the Warrant and 2,000,000 shares of Common Stock (the “Commitment
Shares”) issued to the Investor as a commitment fee pursuant to the terms of the
Standby Equity Distribution Agreement.
The
Company filed the details of this transaction on Form 8-K with the Commission on
October 14, 2008.
As of
September 30, 2009 we have not utilized any portion of this agreement as we feel
its use would cause significant dilution to our shareholders if it were executed
at the Company’s depressed shares price. We continue to review our options as to
using this agreement in the future, if and when it would serve the best interest
of the company and our shareholders.
ITEM
2 –
|
PLAN
OF OPERATION (Continued)
|
Other
than the recently completed private placement all of our funding to date has
been generated from loans from our officers and directors. During the next
twelve months we anticipate that we will have sufficient funds to proceed only
with basic administrative operations and incremental operations with respect to
our investment in in4 Ltd, the the continued development of our RiverPower
technology.
All other
technologies in our portfolio are currently on hold until we realize revenue
from our investment in in4 Ltd or RiverPower. As of September 30, 2009, the
Company has only realized limited revenues from the TothTelescope project, which
has been discontinued, and has not realized any revenues from the other
inventions. In addition we only have limited funds available to continue
acquiring and developing the diverse number of technologies available to us, to
continue research and development efforts with respect to our current
technologies and to fully implement our business plan. If we do not obtain the
funds necessary for us to continue our business activities we may need to
curtail or cease our operations until such time as we have sufficient
funds.
We
currently have no other arrangements for such financings and can give you no
assurance that such financings will be available to us when required or on terms
that we deem acceptable or at all.
Going
Concern and Management’s Plan
The
accompanying unaudited condensed consolidated financial statements have been
prepared in conformity with accounting principles generally accepted in the
United States of America, which contemplate the continuation of the Company as a
going concern and assume realization of assets and the satisfaction of
liabilities in the normal course of business. The Company has incurred losses
from operations since inception. Management anticipates incurring additional
losses in 2009. Further, the Company may incur additional losses thereafter,
depending on its ability to generate revenues from the licensing or sale of its
technologies and products, or to enter into any or a sufficient number of joint
ventures. The Company has minimal revenue to date. There is no assurance that
the Company can successfully commercialize any of its technologies and products
and realize any revenues therefrom. The Company’s technologies and products have
never been utilized on a large-scale commercial basis and there is no assurance
that any of its technologies or products will receive market acceptance. There
is no assurance that the Company can continue to identify and acquire new
technologies.
Since
inception through September 30, 2009, the Company had an accumulated deficit of
$7,442,530 and net cash used in operations of $1,816,535. However, management of
the Company believes that the funding from October, 2008 private placement of
the Company’s common shares (See Note 8) together with the anticipated raising
of additional capital will allow them to continue operations and execute its
business plan.
Management
believes the Company can raise adequate capital to keep the Company functioning
through September 30, 2010. However, no assurance can be given that the Company
can obtain additional working capital, or if obtained, that such funding will
not cause substantial dilution to shareholders of the Company. If the Company is
unable to raise additional funds, it may be forced to change or delay its
contemplated marketing and business plan. Being a development stage company, the
Company is subject to all the risks inherent in the establishment of a new
enterprise and the marketing and manufacturing of a new product, many of which
risks are beyond the control of the Company. All of the factors discussed above
raise substantial doubt about the Company’s ability to continue as a going
concern.
ITEM
2 –
|
PLAN
OF OPERATION (Continued)
|
These
unaudited condensed consolidated financial statements do not include any
adjustments relating to the recoverability of recorded asset amounts that might
be necessary as a result of the above uncertainty.
Critical
Accounting Estimates and Policies
This
discussion and analysis of our financial condition and results of operations are
based upon our condensed consolidated financial statements that have been
prepared in accordance with generally accepted accounting principles in the
United States of America ("US GAAP"). This preparation requires management to
make estimates and assumptions that affect the reported amounts of assets,
liabilities, revenues and expenses, and the disclosure of contingent assets and
liabilities. US GAAP provides the framework from which to make these estimates,
assumption and disclosures. We chose accounting policies within US GAAP that
management believes are appropriate to accurately and fairly report our
operating results and financial position in a consistent manner. Our management
regularly assesses these policies in light of current and forecasted economic
conditions. Accounting policies that our management believes to be critical to
understanding the results of our operations and the effect of the more
significant judgments and estimates used in the preparation of the condensed
consolidated financial statements are as those described in the Form 8-K of the
Company filed on April 16, 2007 for the year ended December 31, 2006 with the
SEC and as amended on August 30, 2007 and as follows.
Research and
Development:
In
accordance with ASC 730-10-25, "Accounting for Research and Development Costs,"
all research and development ("R&D") costs are expensed when they are
incurred, unless they are reimbursed under specific contracts. Assets used in
R&D activity, such as machinery, equipment, facilities and patents that have
alternative future use either in R&D activities or otherwise are
capitalized. In connection with the investment and advances in subsidiary,
associate or other entity where repayment from such subsidiary, associate or
entity solely on the results of the research and development having future
economic benefit, the investment and advance is accounted for as costs incurred
by the Company as research and development in accordance with ASC 730-20-25
"Research and Development Arrangements".
Share-Based
Payment:
In
accordance with ASC 718-10 “Share-Based Payment” all forms of share-based
payment (“SBP”) awards including shares issued under employee stock purchase
plans, stock options, restricted stock and stock appreciation rights result in a
cost that is measured at fair value on the awards’ grant date, based on the
estimated number of awards that are expected to vest.
ITEM
2 –
|
PLAN
OF OPERATION (Continued)
|
The
Company accounts for equity instruments issued to non-employees in accordance
with the provisions of ASC 505-50, “Accounting for Equity Instruments That Are
Issued to Other Than Employees for Acquiring, or in Conjunction with Selling,
Goods or Services,” which requires that such equity instruments are recorded at
their fair value on the measurement date. The measurement of stock-based
compensation is subject to periodic adjustment as the underlying equity
instrument vests. Non-employee stock-based compensation charges are amortized
over the vesting period or period of performance of the services.
Recent
Accounting Pronouncements
In
December 2007, the FASB issued ASC 805-10-15, “Business Combinations” (“SFAS
141(R)”). It expands on the disclosures previously required by SFAS 141, better
defines the acquirer and the acquisition date in a business combination, and
establishes principles for recognizing and measuring the assets acquired
(including goodwill), the liabilities assumed and any non-controlling interests
in the acquired business. ASC 805-10-15 also requires an acquirer to record an
adjustment to income tax expense for changes in valuation allowances or
uncertain tax positions related to acquired businesses. ASC 805-10-15 is
effective for all business combinations with an acquisition date in the first
annual period following December 15, 2008; early adoption is not permitted. We
adopted this statement as of January 1, 2009. Adoption of ASC 805-10-15 did not
have a material impact on the Company’s consolidated financial position, results
of operations or cash flows.
In
December 2007, the FASB issued ASC 810-10-65, “Non-controlling Interests in
Consolidated Financial Statements-an amendment of ARB No. 51”. ASC 810-10-65
requires that non-controlling (or minority) interests in subsidiaries be
reported in the equity section of the company’s balance sheet, rather than in a
mezzanine section of the balance sheet between liabilities and equity. ASC
810-10-65 also changes the manner in which the net income of the subsidiary is
reported and disclosed in the controlling company’s income statement. ASC
810-10-65 also establishes guidelines for accounting or changes in ownership
percentages and for deconsolidation. ASC 810-10-65 is effective for financial
statements for fiscal years beginning on or after December 15, 2008 and interim
periods within those years. The adoption of ASC 810-10-65 did not have a
material impact on our financial position, results of operations or cash
flows.
In March
2008, the FASB issued ASC 815-10-65, “Disclosures about Derivative Instruments
and Hedging Activities-an amendment of FASB Statement No. 133”. ASC 815-10-65
requires enhanced disclosures about an entity’s derivative and hedging
activities and thereby improves the transparency of financial reporting. ASC
815-10-65 is effective for financial statements issued for fiscal years and
interim periods beginning after November 15, 2008, with early application
encouraged. The adoption of ASC 815-10-65 did not have a material impact on our
financial position, results of operations or cash flows.
In March
2008, the FASB issued SFAS No. 162, The Hierarchy of Generally Accepted
Accounting Principles. This statement identifies the sources of accounting
principles and the framework for selecting the principles to be used in the
preparation of financial statements of nongovernmental entities that are
presented in conformity with US GAAP. This statement is effective 60 days
following the SEC’s approval of the Public Company Accounting Oversight Board
amendments to AU Section 411, The Meaning of Present Fairly in Conformity With
Generally Accepted Accounting Principles.
ITEM
2 –
|
PLAN
OF OPERATION (Continued)
|
Effective
January 1, 2009, the Company adopted ASC 470-20 "Accounting for Convertible Debt
Instruments that may be settled in Cash upon Conversion (Including Partial Cash
Settlement)“. ASC 470-20 requires the issuer of certain convertible
debt instruments that may be settled in cash (or other assets) on conversion to
separately account for the liability (debt) and equity (conversion option)
components of the instrument in a manner that reflects the issuer's
non-convertible debt borrowing rate. ASC 470-20 is effective for
fiscal years beginning after December 15, 2008 on a retroactive
basis. This interpretation did not affect the consolidated financial
position or results of operations.
Effective
January 1, 2009, the Company adopted the ASC 260-10, “Determining Whether
Instruments Granted in Share-Based Payment Transactions are Participating
Securities”. This required that all unvested share-based payment
awards that contain nonforfeitable rights to dividends should be included in the
basic Earnings Per Share (EPS) calculation. This standard did not
affect the consolidated financial position or results of
operations.
Effective
April 1, 2009, the Company adopted ASC 320-10-65, “Recognition and Presentation
of Other-Than-Temporary Impairments”. ASC 320-10-65 provides guidance in
determining whether impairments in debt securities are other than temporary, and
modifies the presentation and disclosures surrounding such instruments. This is
effective for interim periods ending after June 15, 2009, but early adoption is
permitted for interim periods ending after March 15, 2009. This standard did not
affect the consolidated financial position or results of
operations.
Effective
April 1, 2009, the Company adopted ASC 820-10-65, “Determining Fair Value When
the Volume and Level of Activity for the Asset or Liability Have Significantly
Decreased and Identifying Transactions That Are Not Orderly”. ASC 820-10-65
provides additional guidance in determining whether the market for a financial
asset is not active and a transaction is not distressed for fair value
measurement purposes as defined in ASC 820-10-55, “Fair Value Measurements.” ASC
820-10-65 is effective for interim periods ending after June 15, 2009, but early
adoption is permitted for interim periods ending after March 15, 2009. This
standard did not affect the consolidated financial position or results of
operations.
Effective
April 1, 2009 the Company adopted ASC 825-10-65, “Interim Disclosures about Fair
Value of Financial Instruments”. This amends ASC 820-10-55, “Disclosures about
Fair Values of Financial Instruments,” to require disclosures about fair value
of financial instruments in interim financial statements as well as in annual
financial statements. It also amends ASC 270-10, “Interim Financial Reporting,”
to require those disclosures in all interim financial statements. This standard
did not affect the consolidated financial position or results of
operations.
ITEM
2 –
|
PLAN
OF OPERATION (Continued)
|
In May
2009, FASB issued ASC 855-10, Subsequent Events. The standard introduces the
concept of financial statements being available to be issued. It requires the
disclosure of the date through which an entity has evaluated subsequent events
and the basis for that date, that is, whether that date represents the date the
financial statements were issued or were available to be issued. In accordance
with this statement, an entity should apply the requirements to interim or
annual financial periods ending after June 15, 2009. Management performed an
evaluation of the Company’s activities through the time of filing this Quarterly
Report on Form 10-Q on November 3, 2009, and has concluded that there are no
significant subsequent events requiring recognition or disclosure in these
consolidated financial statements.
In June
2009, FASB issued SFAS No. 167, an amendment to FASB Interpretation No. 46(R).
This Statement amends Interpretation 46(R) to require an enterprise to perform
an analysis to determine whether the enterprise’s variable interest or interests
give it a controlling financial interest in a variable interest entity. This
analysis identifies the primary beneficiary of a variable interest entity as the
enterprise that has several defined characteristics. Additionally, an enterprise
is required to assess whether it has an implicit financial responsibility to
ensure that a variable interest entity operates as designed when determining
whether it has the power to direct the activities of the variable interest
entity that most significantly impact the entity’s economic performance. This
amendment shall be effective as of the beginning of each reporting entity’s
first annual reporting period that begins after November 15, 2009, for interim
periods within that first annual reporting period, and for interim and annual
reporting periods thereafter. Earlier application is prohibited. The
adoption of is not expected to this interpretation have a material impact on our
financial position, results of operations or cash flows.
In June
2009, FASB issued ASC 105-10, The FASB Accounting Standards Codification and the
Hierarchy of Generally Accepted Accounting Principles—a replacement of FASB
Statement No. 162. The FASB Accounting Standards Codification (Codification)
became 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. 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 became nonauthoritative.
This Statement is effective for financial statements issued for interim and
annual periods ending after September 15, 2009. The Company adopted this
requirement.
Results of
Operations
Nine Months Period Ended
September 30, 2009 compared to Nine Months Period Ended September 30,
2008
Revenue
For the
nine months ended September 30, 2009 and 2008, we had no revenues.
General,
selling and administrative expenses
For the
nine months ended September 30, 2009 general, selling and administrative
expenses were $843,090 as compared to $2,430,923 for the nine months ended
September 30, 2008. The decrease in general, selling and administrative expenses
are attributable to stock based payments and consulting
expenses.
ITEM
2 –
|
PLAN
OF OPERATION (Continued)
|
INFLATION AND FOREIGN
CURRENCY
We
maintain our books in local currency: US Dollars for the parent holding company
in the United States of America and Hungarian Forint for Vidatech in
Hungary.
Our
operations are conducted primary outside of the United States through our wholly
owned subsidiary. As a result, fluctuations in currency exchange rates may
significantly affect our sales, profitability and financial position when the
foreign currencies, primarily the Hungarian Forint, of its international
operations are translated into U.S. dollars for financial reporting. In
additional, we are also subject to currency fluctuation risk with respect to
certain foreign currency denominated receivables and payables. Although we
cannot predict the extent to which currency fluctuations may or will affect our
business and financial position, there is a risk that such fluctuations will
have an adverse impact on our sales, profits and financial position. Because
differing portions of our revenues and costs are denominated in foreign
currency, movements could impact our margins by, for example, decreasing our
foreign revenues when the dollar strengthens and not correspondingly decreasing
our expenses. We do not currently hedge our currency exposure. In the future, we
may engage in hedging transactions to mitigate foreign exchange
risk.
The
translation of our subsidiary’s Forint denominated balance sheets
into U.S. dollars, as of September 30, 2009, has been affected by the weakening
of the U.S. dollar against the Hungarian Forint from 188.55 HUF/USD as of
December 31, 2008, to 184.8 HUF/USD as of September 30, 2009, an approximate 2%
increase in value. The average Hungarian Forint/U.S. dollar exchange rates used
for the translation of the subsidiaries forint denominated statements of
operations into U.S. dollars, for the nine months ended September 30, 2009 and
2008 were 208.53 and 162.45, respectively.
CONTROLS
AND PROCEDURES
|
As
indicated in the certifications in Exhibit 31 of this report, the Corporation’s
chief executive officer, principal financial officer and principal accounting
officer have evaluated the Corporation’s disclosure controls and procedures as
of September 30, 2009. Based on that evaluation, these officers have
concluded that the Company’s disclosure controls and procedures are effective in
ensuring that information required to be disclosed by the Company in the reports
that it files or submits under the Securities Exchange Act of 1934, as amended,
is accumulated and communicated to them in a manner that allows for timely
decisions regarding required disclosures and are effective in ensuring that such
information is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commission’s rules and
forms. There were no changes during the Company's last fiscal quarter
that materially affected, or are reasonably likely to materially affect, the
Company's internal control over financial reporting.
OTHER
INFORMATION
|
LEGAL
PROCEEDINGS
|
On May
12, 2009 we presented with a court order for a hearing, initated by Janos Salca,
inventor of our RiverPower technology. In the court documents made available to
us Mr. Salca alleges that at the signing of our Invention Transfer Agreement,
dated May 24, 2006 we intentionally mislead him as to our intent to develop his
technology. On June 22, 2009 our Legal Counsel attended the corth
hearing on the inventor’s motion to anull the invention transfer agreement. At
this hearing the judge asked us to submit documentation showing our continued
development of our RiverPower technology as proof that we are in fact working
toward a commercial product as opposed to the claim of the inventor that we are
not. As per this ruling our legal consel submitted all required document to the
court. A second hearing on this issue is scheduled for January,
2010.
We
believe the claim brought forth by Mr. Salca to be completely without merit. We
have been diligently, although at a much slower pace than originally
anticipated, pursuing development of RiverPower. We anticipate having a full
scale prototype available for river testing in the first half of 2010 pending
completion of technology optimisation, and the securing of required licenses and
permits. In addition, we are also continuing development of the associated slow
prm, 50Hz syncron generator, which should be available for testing by the end of
November 2010. In addition, we have also received the second round of
testing results from VITUKI, the independent agency we have commissioned for the
testing of RiverPower.
It is our
opinion that the baseless case filed by Mr. Salca case will be dismissed as one
without merit. We do not foresee it having any effect on our continued
development RiverPower. However we cannot guarantee that the technology will
ever be commercialised if at any phase of its development we learn that the
power output anticipated can not be achieved and RiverPower cannot provide an
economical solution for power generation. Our continued investigation will shed
light on this in the first half of 2010.
UNREGISTERED
SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS
|
In April
2009, the Company entered into an agreement with two professionals for
consulting services. According to the agreement the professionals provided
consulting services to the Company in 2009. In connection with these services,
the Company issued to them 250,000 shares of the Company’s common stock. These
share issuances were recorded at $0.4 per share in the total amount of $100,000
and the related expense was recorded under general administration.
On
February 5, 2009, the Company entered into a restricted stock agreement with
Ildiko Rozsa, who is to serve as the Chief Financial Officer of the Company. As
part of the agreement Ms. Rozsa was granted 120,000 shares of the Company’s
restricted common stock of which 30,000 shares will vest quarterly, at the end
of each quarter, so long as Ms. Rozsa is employed by the Company.
On
February 5, 2009, the Company entered into a restricted stock agreement with
Szilvia Toth, the Chief Accounting Officer of the Company. As part of the
agreement Ms. Toth was granted 120,000 shares of restricted common stock, of
which 30,000 shares will vest quarterly, at the end of each quarter, so long as
Ms. Toth is employed by the Company.
On
February 5, 2009, the Company entered into a restricted stock agreement with
Mihaly Zala, the Chief Technology Officer of the Company. As part of the
agreement Mr. Zala was granted 120,000 shares of restricted common stock, which
will vest on equal installments of 30,000 shares quarterly, at the end of each
quarter, so long as Mr. Zala is employed by the Company. As of July 15, 2009 Mr.
Zala is no longer employed by the Company, therefore 60,000 shares of the
120,000 granted to him were cancelled and returned to the authorized and
unissued stock of the company.
On
February 5, 2009, the Company entered into a restricted stock agreement with
Imre Eotvos, the Technology Assistant of the Company. As part of the agreement
Mr. Eotvos was granted 200,000 shares of restricted common stock, which will
vest on equal installments of 50,000 shares quarterly, at the end of each
quarter, so long as Mr. Eotvos is employed by the Company.
On
February 5, 2009, the Company entered into a restricted stock agreement with
Daniel Kun, Jr., who is to serve as Secretary and Vice President of the company
on a going forward basis. As part of the agreement Mr. Kun was granted 200,000
shares of restricted common stock, which will vest on equal installments of
50,000 shares quarterly, at the end of each quarter, so long as Mr. Kun is
employed by the Company.
As
consideration for the above services, the Company issued an aggregate of 760,000
shares of the Company’s common stock. These share issuances were recorded at
$0.4 per share in the total amount of $304,000 in accordance with measurement
date principles prescribed under ASC 718-10 and ASC 505-50.
In
January 2008, pursuant to a private placement under Regulation S of the
Securities Act of 1933, as amended, the Company sold 32,500 shares of its common
stock at $3.25 per share for aggregate proceeds of $105,625. The Company also
entered into a Registration Rights Agreement, pursuant to which it agreed that
as soon as practicable from the Offering Termination Date, as defined in the
Registration Rights Agreement, it would file a registration statement with the
SEC covering the resale of the shares of the Company’s common stock that are
issuable pursuant to this private placement.
There are
no stipulated damages outlined in the Registration Rights Agreement for failure
to file within the agreed upon time frame. Under such agreement, the holder is
entitled to exercise all rights granted by law, including recovery of damages
under this agreement.
ITEM
2 –
|
UNREGISTERED
SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
(Continued)
|
On April
18, 2008 the Company entered an agreement with RedChip Companies Inc. and
Partner Media4Equity Inc. for investor relationship program for 12 months
period. The Company secures and delivers 306,570 restricted common shares with a
strike price of $0.70 for a 12 months period in connection with RedChip investor
relationship services. The compensation for Media4Equity services is the
delivery of 1,500,000 restricted common shares with a strike price of $0.75 for
the contract period. This agreement expired on April 18, 2009. We elected not to
renew it.
On May
17, 2008 the Company entered into an agreement with Wakabayashi Fund LLC in
order to arrange financing for working capital as an intermediary. Wakabayashi
Fund LLC provides capital funding services including serving as an investment
banking liaison and acts as capital consultant for a six month period. The
Company issued 111,111 shares of restricted common stock upfront at $1.35 per
share. Additionally, the Company agreed to pay for the capital funding services
7% success fee. This agreement expired on November 17, 2008 without any funds
raised as a direct result of services provided by the Wakabayashi Fund. We
elected not to renew it.
DEFAULTS
UPON SENIOR SECURITIES
|
Not
applicable.
SUBMISSION
OF MATTERS TO A VOTE OF SECURITY
HOLDERS
|
Not
applicable.
OTHER
INFORMATION
|
Not
applicable.
EXHIBITS
|
1.0
|
Otto
Buresch Invention Transfer Termination Agreement
|
|
31.1
|
|
Certification
of the Company’s Principal Executive Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002, with respect to the registrant’s Quarterly
Report on Form 10-Q for the quarter ended September 30,
2009.
|
|
|
|
31.2
|
|
Certification
of the Company’s and Principal Financial Officer pursuant to Section 302
of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s
Quarterly Report on Form 10-Q for the quarter ended September 30,
2009.
|
|
|
|
32.1
|
|
Certification
of the Company’s Principal Executive Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
|
|
32.2
|
|
Certification
of the Company’s Principal Financial Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
Registrant has duly caused the Report to be signed on its behalf by the
undersigned thereunto duly authorized.
|
Power
of the Dream Ventures, Inc.
(formerly
known as “Tia V, Inc.”)
|
|
|
|
|
Dated:
November 13, 2009
|
By:
|
/s/ Viktor
Rozsnyay
|
|
|
Viktor
Rozsnyay
|
|
|
Chief
Executive Officer
|
|
|
|
|
|
/s/
Ildiko Rozsa
|
|
|
Principal
Financial Officer
|
Power of the Dream Ventures,
Inc.
Form 10Q for the quarter
ended September 30, 2009
Index to Exhibits
Filed
Otto
Buresch Invention Transfer Termination Agreement
|
||
|
Certification
of the Company’s Principal Executive Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002, with respect to the registrant’s Quarterly
Report on Form 10-Q for the quarter ended September 30,
2009.
|
|
|
|
|
|
Certification
of the Company’s and Principal Financial Officer pursuant to Section 302
of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s
Quarterly Report on Form 10-Q for the quarter ended September 30,
2009.
|
|
|
|
|
|
Certification
of the Company’s Principal Executive Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
|
|
|
|
Certification
of the Company’s Principal Financial Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
40