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These terms and conditions govern your use of the website alphaminr.com and its related services.
These Terms and Conditions (“Terms”) are a binding contract between you and Alphaminr, (“Alphaminr”, “we”, “us” and “service”). You must agree to and accept the Terms. These Terms include the provisions in this document as well as those in the Privacy Policy. These terms may be modified at any time.
Your subscription will be on a month to month basis and automatically renew every month. You may terminate your subscription at any time through your account.
We will provide you with advance notice of any change in fees.
You represent that you are of legal age to form a binding contract. You are responsible for any
activity associated with your account. The account can be logged in at only one computer at a
time.
The Services are intended for your own individual use. You shall only use the Services in a
manner that complies with all laws. You may not use any automated software, spider or system to
scrape data from Alphaminr.
Alphaminr is not a financial advisor and does not provide financial advice of any kind. The service is provided “As is”. The materials and information accessible through the Service are solely for informational purposes. While we strive to provide good information and data, we make no guarantee or warranty as to its accuracy.
TO THE EXTENT PERMITTED BY APPLICABLE LAW, UNDER NO CIRCUMSTANCES SHALL ALPHAMINR BE LIABLE TO YOU FOR DAMAGES OF ANY KIND, INCLUDING DAMAGES FOR INVESTMENT LOSSES, LOSS OF DATA, OR ACCURACY OF DATA, OR FOR ANY AMOUNT, IN THE AGGREGATE, IN EXCESS OF THE GREATER OF (1) FIFTY DOLLARS OR (2) THE AMOUNTS PAID BY YOU TO ALPHAMINR IN THE SIX MONTH PERIOD PRECEDING THIS APPLICABLE CLAIM. SOME STATES DO NOT ALLOW THE EXCLUSION OR LIMITATION OF INCIDENTAL OR CONSEQUENTIAL OR CERTAIN OTHER DAMAGES, SO THE ABOVE LIMITATION AND EXCLUSIONS MAY NOT APPLY TO YOU.
If any provision of these Terms is found to be invalid under any applicable law, such provision shall not affect the validity or enforceability of the remaining provisions herein.
This privacy policy describes how we (“Alphaminr”) collect, use, share and protect your personal information when we provide our service (“Service”). This Privacy Policy explains how information is collected about you either directly or indirectly. By using our service, you acknowledge the terms of this Privacy Notice. If you do not agree to the terms of this Privacy Policy, please do not use our Service. You should contact us if you have questions about it. We may modify this Privacy Policy periodically.
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We use Google Analytics and we use Stripe for payment processing. We will not share the information we collect with third parties for promotional purposes. We may share personal information with law enforcement as required or permitted by law.
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended April 30, 2012
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from __________ to __________.
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Commission file number:
0-9483
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SPARTA COMMERCIAL SERVICES, INC.
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(Exact name of registrant as specified in its charter)
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NEVADA
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30-0298178
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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462 Seventh Ave, 20th Floor, New York, NY
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10018
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(Address of principal executive offices)
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(Zip Code)
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Common Stock, par value $0.001
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(Title of class)
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Large accelerated filer
o
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Accelerated filer
o
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Non-accelerated filer
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(Do not check if a smaller reporting company)
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Smaller reporting company
x
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Page
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PART I
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Item 1.
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3
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Item 1A.
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13
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Item 1B.
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16
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Item 2.
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16
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Item 3.
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16
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Item 4.
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16
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PART II
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Item 5.
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17
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Item 6.
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18
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Item 7.
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19
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Item 7A.
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23
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Item 8.
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24
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Item 9.
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49
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Item 9A.
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49
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Item 9B.
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49
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PART III
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Item 10.
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50
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Item 11.
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52
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Item 12.
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54
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Item 13.
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56
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Item 14.
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57
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Item 15.
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57
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59
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·
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prevent the introduction or reintroduction of stolen motor vehicles into interstate commerce;
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·
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protect states, consumers (both individual and commercial), and other entities from fraud;
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·
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reduce the use of stolen vehicles for illicit purposes including funding of criminal enterprises; and
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·
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provide consumer protection from unsafe vehicles.
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·
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Purchase a report directly from the Cyclechex, RVchecks or CarVINreport website
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·
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Purchase a report via an Affiliate website
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·
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Dealers purchase a “block” of history reports from Cyclechex, RVchecks or CarVINreport (with pricing incentives to purchase a larger quantity of reports)
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·
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This will facilitate the dealers' acceptance of trade-in vehicles and add value to the purchase of any pre-owned motorcycle, RV, automobile, or light truck
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·
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Dealers may absorb the cost of the report or re-sell the report to their customer
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·
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Dealers and other industry sources may incorporate the Cyclechex, RVchecks, or CarVINreport website link in their sales and marketing strategies
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·
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Affiliates will earn commission on any Cyclechex, RVchecks, or CarVINreport history reports that are generated from their sites
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·
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Retail installment sales contracts and leases;
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·
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Municipal leasing of equipment;
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·
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Private label programs for manufacturers and distributors;
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·
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Ancillary products and services, such as private label GAP coverage; and
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·
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Remarketing of repossessed vehicles and off-lease vehicles.
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·
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Fair Debt Collection Practices Act. The Fair Debt Collection Practices Act and applicable state law counterparts prohibit us from contacting customers during certain times and at certain places, from using certain threatening practices and from making false implications when attempting to collect a debt.
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·
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Truth in Lending Act. The Truth in Lending Act requires us and the dealers we do business with to make certain disclosures to customers, including the terms of repayment, the total finance charge, and the annual percentage rate charged on each contract.
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·
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Consumer Leasing Act. The Consumer Leasing Act applies to any lease of consumer goods for more than four months. The law requires the seller to disclose information such as the amount of initial payment, number of monthly payments, total amount for fees, penalties for default, and other information before a lease is signed.
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·
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The Consumer Credit Protection Act of 1968. The Act required creditors to state the cost of borrowing in a common language so that the consumer can figure out what the charges are, compare costs, and shop for the best credit deal.
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·
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Equal Credit Opportunity Act. The Equal Credit Opportunity Act prohibits creditors from discriminating against loan applicants on the basis of race, color, sex, age, or marital status. Pursuant to Regulation B promulgated under the Equal Credit Opportunity Act, creditors are required to make certain disclosures regarding consumer rights and advise consumers whose credit applications are not approved of the reasons for the rejection.
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·
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Fair Credit Reporting Act. The Fair Credit Reporting Act requires us to provide certain information to consumers whose credit applications are not approved on the basis of a report obtained from a consumer reporting agency.
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·
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Gramm-Leach-Bliley Act. The Gramm-Leach-Bliley Act requires us to maintain privacy with respect to certain consumer data in our possession and to periodically communicate with consumers on privacy matters.
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·
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Soldiers' and Sailors' Civil Relief Act. The Soldiers' and Sailor's Civil Relief Act requires us to reduce the interest rate charged on each loan to customers who have subsequently joined, enlisted, been inducted or called to active military duty, if requested to do so.
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·
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Electronic Funds Transfer Act. The Electronic Funds Transfer Act prohibits us from requiring our customers to repay a loan or other credit by electronic funds transfer ("EFT"), except in limited situations that do not apply to us. We are also required to provide certain documentation to our customers when an EFT is initiated and to provide certain notifications to our customers with regard to preauthorized payments.
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·
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Telephone Consumer Protection Act. The Telephone Consumer Protection Act prohibits telephone solicitation calls to a customer's home before 8 a.m. or after 9 p.m. In addition, if we make a telephone solicitation call to a customer's home, the representative making the call must provide his or her name, our name, and a telephone number or address at which our representative may be contacted. The Telephone Consumer Protection Act also requires that we maintain a record of any requests by customers not to receive future telephone solicitations, which must be maintained for five years.
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·
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Bankruptcy. Federal bankruptcy and related state laws may interfere with or affect our ability to recover collateral or enforce a deficiency judgment.
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·
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Dodd-Frank Wall Street Reform and Consumer Protection Act. The Dodd-Frank Wall Street Reform and Consumer Protection Act authorized the creation of a Bureau of Consumer Financial Protection. The impact on the Company of the newly-created agency is unknown at this time as the agency is yet to be formed.
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High
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Low
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|||||||
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Fiscal Year 2012
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||||||||
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First quarter (May 1, 2011 – July 31, 2011)
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$
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1.50
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$
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0.75
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||||
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Second quarter (August 1, 2011 – October 31, 2011)
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$
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0.75
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$
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0.75
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||||
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Third quarter (November 1, 2011 – January 31, 2012)
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$
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0.75
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$
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0.75
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||||
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Fourth quarter (February 1, 2012 – April 30, 2012)
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$
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1.50
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$
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0.75
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||||
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Fiscal Year 2011
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||||||||
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First quarter (May 1, 2010 - July 31, 2010)
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$
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2.25
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$
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0.75
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||||
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Second quarter (August 1, 2010 - October 31, 2010)
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$
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2.25
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$
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1.50
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||||
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Third quarter (November 1, 2010 - January 31, 2011)
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$
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2.25
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$
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0.75
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||||
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Fourth quarter (February 1, 2011 - April 30, 2011)
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$
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2.25
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$
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0.75
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||||
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·
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seeking additional credit facilities from institutional lenders;
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·
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seeking institutional investors for equity investments in our company; and
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·
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initiating negotiations to secure short term financing through promissory notes or other debt instruments on an as needed basis.
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Page
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25
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26
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27
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28
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29
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30 - 48
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April 30, 2012
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April 30, 2011
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|||||||
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ASSETS
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||||||||
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Cash and cash equivalents
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$ | 19,138 | $ | 10,786 | ||||
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RISC loan receivables, net of reserve of $15,276 and $45,015,
respectively (NOTE D)
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290,235 | 855,278 | ||||||
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Motorcycles and other vehicles under operating leases net of accumulated depreciation of $120,151 and $217,885,
respectively, and loss reserve of $10,498 and $9,650 , respectively (NOTE B)
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243,284 | 231,564 | ||||||
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Interest receivable
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3,807 | 9,239 | ||||||
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Purchased portfolio (NOTE G)
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- | 24,544 | ||||||
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Accounts receivable
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162,350 | 66,387 | ||||||
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Inventory (NOTE C)
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25,885 | 13,126 | ||||||
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Property and equipment, net of accumulated depreciation and amortization of $187,842 and $176,677, respectively (NOTE E)
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21,499 | 14,570 | ||||||
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Deferred expenses
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- | 138,405 | ||||||
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Goodwill
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10,000 | 10,000 | ||||||
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Restricted cash
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54,937 | 64,686 | ||||||
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Other assets
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9,628 | - | ||||||
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Deposits
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48,967 | 48,967 | ||||||
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Total assets
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$ | 889,730 | $ | 1,487,553 | ||||
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LIABILITIES AND DEFICIT
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||||||||
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Liabilities:
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||||||||
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Accounts payable and accrued expenses
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$ | 1,267,160 | $ | 1,133,721 | ||||
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Senior secured notes payable (NOTE F)
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516,012 | 974,362 | ||||||
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Notes payable net of beneficial conversion feature of $33,979 and $52,272, respectively (NOTE G)
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1,791,692 | 1,377,065 | ||||||
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Loans payable-related parties (NOTE H)
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386,760 | 386,760 | ||||||
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Other liabilities
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- | 75,409 | ||||||
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Derivative liabilities
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374,697 | 484,301 | ||||||
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Deferred revenue
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- | 2,250 | ||||||
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Total liabilities
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4,336,321 | 4,433,868 | ||||||
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Deficit:
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||||||||
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Preferred Stock, $.001 par value; 10,000,000 shares authorized of which 35,850 shares have been designated as Series A
c
onvertible preferred stock, with a stated value of $100 per share, 125 and 125 shares issued and outstanding, respectively
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12,500 | 12,500 | ||||||
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Preferred Stock B, 1,000 shares have been designated as Series B redeemable preferred stock, $0.001 par value,
with a liquidation and redemption value of $10,000 per share, 157 and 157 shares issued and outstanding, respectively
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1,570 | - | ||||||
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Preferred Stock C, 200,000 shares have been designated as Series C redeemable, convertible preferred, $0.001 par value,
with a liquidation and redemption value of $10 per share, 0 and 0 shares issued and outstanding, respectively
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- | - | ||||||
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Common stock, $.001 par value; 740,000,000 shares authorized, 8,668,123 and 6,388,168 shares issued and outstanding, respectively
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8,668 | 6,388 | ||||||
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Common stock to be issued, 1,125,099, and 985,324 respectively
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1,125 | 985 | ||||||
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Preferred Stock B to be issued, 41.09 and 25.34 shares, respectively
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- | - | ||||||
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Additional paid-in-capital
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35,209,835 | 33,976,134 | ||||||
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Subscriptions receivable, preferred stock, Series B
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(2,118,309 | ) | (2,118,309 | ) | ||||
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Accumulated deficit
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(37,265,135 | ) | (35,114,802 | ) | ||||
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Total deficiency in stockholders' equity
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(4,149,745 | ) | (3,237,104 | ) | ||||
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Noncontrolling Interest
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703,154 | 290,789 | ||||||
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Total deficit
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(3,446,592 | ) | (2,946,315 | ) | ||||
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Total liabilities and deficit
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$ | 889,730 | $ | 1,487,553 | ||||
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Year Ended
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||||||||
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April 30,
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||||||||
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2012
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2011
|
|||||||
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Revenue
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||||||||
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Rental income, leases
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$
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135,306
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$
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112,465
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||||
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Interest income, loans
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105,355
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240,923
|
||||||
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Information services
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289,628
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52,911
|
||||||
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Other
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71,543
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107,468
|
||||||
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Total Revenue
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601,832
|
513,768
|
||||||
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Operating expenses:
|
||||||||
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General and administrative
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2,216,436
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2,795,137
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||||||
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Depreciation and amortization
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76,510
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92,394
|
||||||
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Total operating expenses
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2,292,946
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2,887,532
|
||||||
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Loss from operations
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(1,691,114
|
)
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(2,373,763
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)
|
||||
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Other expense:
|
||||||||
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Interest expense and financing cost, net
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486,242
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394,384
|
||||||
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Non-cash financing costs
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116,147
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126,848
|
||||||
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Amortization of debt discount
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126,303
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108,977
|
||||||
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Change in derivative liability
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(389,574
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)
|
659,895
|
|||||
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Total other expenses
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339,119
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1,290,104
|
||||||
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Net loss
|
$
|
(2,030,233
|
)
|
$
|
(3,663,868
|
)
|
||
|
Net Loss attributed to noncontrolling interest
|
38,090
|
92,211
|
||||||
|
Preferred dividend
|
(158,190
|
)
|
(157,746
|
)
|
||||
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Net loss attributed to common stockholders
|
$
|
(2,150,333
|
)
|
$
|
(3,729,402
|
)
|
||
|
Basic and diluted loss per share
|
$
|
(0.27
|
)
|
$
|
(0.63
|
)
|
||
|
Basic and diluted loss per share attributed to
common stockholders
|
$
|
(0.28
|
)
|
$
|
(0.64
|
)
|
||
|
Weighted average shares outstanding
|
7,569,609
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5,814,636
|
||||||
|
Series A
Preferred Stock
|
Series B
Preferred Stock
|
Series C
Preferred Stock
|
Common
Stock
|
Common Stock
to be issued
|
Subscriptions
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Additional
Paid in
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Accumulated
|
Non-controlling
|
||||||||||||||||||||||||||||||||||||||||||||||||||||
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Shares
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Amount
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Shares
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Amount
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Shares
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Amount
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Shares
|
Amount
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Shares
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Amount
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Receivable
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Capital
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Deficit
|
Interest
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Total
|
||||||||||||||||||||||||||||||||||||||||||||||
|
Balance, April 30, 2010
|
125 | $ | 12,500 | 157 | $ | 1 | 42,000 | $ | 42 | 5,237,097 | $ | 5,237 | 319,560 | $ | 320 | $ | (2,118,309 | ) | $ | 31,881,844 | $ | (31,385,400 | ) | $ | - | $ | (1,603,763 | ) | ||||||||||||||||||||||||||||||||
|
Preferred Dividend
|
- | - | - | - | - | - | - | - | - | - | - | 157,746 | - | - | 157,746 | |||||||||||||||||||||||||||||||||||||||||||||
|
Beneficial conversion discount
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- | - | - | - | - | - | - | - | - | - | - | 311,494 | - | - | 311,494 | |||||||||||||||||||||||||||||||||||||||||||||
|
Reclassification of warrant liability
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- | - | - | - | - | - | - | - | - | - | - | 25,027 | - | - | 25,027 | |||||||||||||||||||||||||||||||||||||||||||||
|
Sale of stock
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- | - | - | - | - | - | 400,871 | 401 | 599,093 | 599 | - | 703,256 | - | - | 704,256 | |||||||||||||||||||||||||||||||||||||||||||||
|
Shares issued for financing cost
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- | - | - | - | - | - | 70,814 | 71 | 5,267 | 5 | - | 126,852 | - | - | 126,928 | |||||||||||||||||||||||||||||||||||||||||||||
|
Shares issued for conversion of notes & interest
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- | - | - | - | - | - | 309,667 | 309 | 61,999 | 62 | - | 371,523 | - | - | 371,894 | |||||||||||||||||||||||||||||||||||||||||||||
|
Stock compensation
|
- | - | - | - | - | - | 254,134 | 254 | (595 | ) | (1 | ) | - |
299,878
|
- | - | 300,131 | |||||||||||||||||||||||||||||||||||||||||||
|
Shares issued for accounts payable
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- | - | - | - | - | - | 17,745 | 18 | - | - | - | (5,023 | ) | - | - | (5,005 | ) | |||||||||||||||||||||||||||||||||||||||||||
|
Conversion of Series C preferred stock
|
- | - | - | - | (42,000 | ) | (42 | ) | 97,718 | 98 | - | - | - | (56 | ) | - | - | 1 | ||||||||||||||||||||||||||||||||||||||||||
|
Employee options expense
|
- | - | - | - | - | - | - | - | - | - | - | 103,589 | - | - | 103,589 | |||||||||||||||||||||||||||||||||||||||||||||
|
Subsidiary's preferred series A issued for cash
|
- | - | - | - | - | - | - | - | - | - | - | - | - | 197,000 | 197,000 | |||||||||||||||||||||||||||||||||||||||||||||
|
Subsidiary's preferred series B issued for cash
|
- | - | - | - | - | - | - | - | - | - | - | - | - | 165,000 | 165,000 | |||||||||||||||||||||||||||||||||||||||||||||
|
Subsidiary's common stock issued for purchase of Cyclechex, LLC
|
- | - | - | - | - | - | - | - | - | - | - | - | - | 6,000 | 6,000 | |||||||||||||||||||||||||||||||||||||||||||||
|
Subsidiary's Preferred B stock to be issued
|
- | - | - | - | - | - | - | - | - | - | - | - | - | 15,000 | 15,000 | |||||||||||||||||||||||||||||||||||||||||||||
|
Net Loss
|
- | - | - | - | - | - | - | - | - | - | - | - | (3,729,402 | ) | (92,211 | ) | (3,821,613 | ) | ||||||||||||||||||||||||||||||||||||||||||
|
Balance April 30, 2011
|
125 | $ | 12,500 | 157 | $ | 1 | - | $ | - | 6,388,168 | $ | 6,388 | 985,324 | $ | 985 | $ | (2,118,309 | ) | $ | 33,976,134 | $ | (35,114,802 | ) | $ | 290,789 | $ | (2,946,315 | ) | ||||||||||||||||||||||||||||||||
|
Correction in par value
|
- | - | - | 1,570 | - | - | - | - | - | - | - | (1,305 | ) | - | - | 265 | ||||||||||||||||||||||||||||||||||||||||||||
|
Cancelled common shares
|
- | - | - | - | - | - | - | - | (5,431 | ) | (5 | ) | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||
|
Preferred dividend to be issued
|
- | - | - | - | - | - | - | - | - | - | 157,393 | - | - | 157,393 | ||||||||||||||||||||||||||||||||||||||||||||||
|
Derivative liability reclassification
|
- | - | - | - | - | - | - | - | - | - | (171,960 | ) | - | - | (171,960 | ) | ||||||||||||||||||||||||||||||||||||||||||||
|
Sale of stock
|
- | - | - | - | - | - | 584,191 | 584 | 70,468 | 70 | - | 283,201 | - | - | 283,855 | |||||||||||||||||||||||||||||||||||||||||||||
|
Shares issued for financing cost
|
- | - | - | - | - | - | 160,907 | 161 | (3,133 | ) | (3 | ) | - | 115,989 | - | - | 116,147 | |||||||||||||||||||||||||||||||||||||||||||
|
Shares issued for conversion of notes & interest
|
- | - | - | - | - | - | 1,119,912 | 1,120 | 47,506 | 48 | - | 395,826 | - | - | 396,859 | |||||||||||||||||||||||||||||||||||||||||||||
|
Stock compensation
|
- | - | - | - | - | - | 414,945 | 415 | 21,476 | 21 | - | 271,461 | - | - | 271,897 | |||||||||||||||||||||||||||||||||||||||||||||
|
Purchase of assets for stock
|
- | - | - | - | - | - | - | - | 8,889 | 9 | - | 9,991 | - | - | 10,000 | |||||||||||||||||||||||||||||||||||||||||||||
|
Employee options expense
|
- | - | - | - | - | - | - | - | - | - | - | 173,105 | - | - | 173,105 | |||||||||||||||||||||||||||||||||||||||||||||
|
Sale of subsidiary's preferred stock
|
- | - | - | - | - | - | - | - | - | - | - | - | - | 450,455 | 450,455 | |||||||||||||||||||||||||||||||||||||||||||||
|
Net Loss
|
- | - | - | - | - | - | - | - | - | - | - | - | (2,150,333 | ) | (38,090 | ) | (2,188,423 | ) | ||||||||||||||||||||||||||||||||||||||||||
|
Balance April 30, 2012
|
125 | $ | 12,500 | 157 | $ | 1,570 | - | $ | - | 8,668,123 | $ | 8,668 | $ | 1,125,099 | $ | 1,125 | $ | (2,118,309 | ) | 35,209,835 | $ | (37,265,135 | ) | $ | 703,154 | $ | (3,446,592 | ) | ||||||||||||||||||||||||||||||||
|
|
Year end
|
Year end
|
||||||
|
April 30, 2012
|
April 30, 2011
|
|||||||
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||||||
|
Net Loss
|
$ | (2,030,233 | ) | $ | (3,663,867 | ) | ||
|
Adjustments to reconcile net loss to net cash used in
operating activities:
|
||||||||
|
Depreciation and Amortization
|
74,260 | 92,394 | ||||||
|
Allowance for loss reserves
|
(28,891 | ) | (93,200 | ) | ||||
|
Amortization of debt discount
|
126,303 | 230,644 | ||||||
|
Equity based compensation
|
445,011 | 403,720 | ||||||
|
Stock based finance cost
|
116,147 | 126,928 | ||||||
|
Change in derivative liabilities
|
(389,574 | ) | 538,228 | |||||
|
(Increase) decrease in operating assets:
|
||||||||
|
Inventory
|
(12,759 | ) | 1,496 | |||||
|
Interest receivable
|
5,432 | 17,533 | ||||||
|
Accounts receivable
|
(95,963 | ) | 17,520 | |||||
|
Prepaid expenses and other assets
|
128,777 | (11,773 | ) | |||||
|
Restricted cash
|
9,749 | 81,647 | ||||||
|
Portfolio
|
24,544 | 9,015 | ||||||
|
Increase (decrease) in operating liabilities:
|
||||||||
|
Note issued in settlement of accrued interest
|
95,000 | |||||||
|
Accounts payable and accrued expenses
|
154,385 | 229,885 | ||||||
|
Net cash used in operating activities
|
(1,377,810 | ) | (2,019,830 | ) | ||||
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
|
Net liquidation (purchase) of leased vehicles
|
(77,913 | ) | 79,917 | |||||
|
Net liquidation of RISC contracts
|
594,782 | 993,180 | ||||||
|
(Purchase) of equipment
|
(8,094 | ) | - | |||||
|
Net cash provided by investing activities
|
508,775 | 1,073,097 | ||||||
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||||||
|
Net proceeds from sale of common stock
|
283,855 | 724,086 | ||||||
|
Sale of subsidiary preferred stock
|
450,455 | 377,000 | ||||||
|
Net payments to senior lender
|
(458,349 | ) | (1,036,627 | ) | ||||
|
Net proceeds from convertible notes
|
601,427 | 878,067 | ||||||
|
Net loan proceeds from other related parties
|
- | 3,000 | ||||||
|
Net cash provided by financing activities
|
877,388 | 945,526 | ||||||
|
Net Increase (decrease) in cash
|
8,353 | (1,208 | ) | |||||
|
Unrestricted cash and cash equivalents, beginning of period
|
10,786 | 11,994 | ||||||
|
Unrestricted cash and cash equivalents , end of period
|
$ | 19,138 | $ | 10,786 | ||||
|
Cash paid for:
|
||||||||
|
Interest
|
143,727 | 211,628 | ||||||
|
Income taxes
|
4,408 | 1,961 | ||||||
|
Non-Cash Investing and Funding Activities (Note O)
|
||||||||
|
·
|
Level 1 —
Quoted prices for identical instruments in active markets. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market, as well as certain securities that are highly liquid and are actively traded in over-the-counter markets.
|
|
·
|
Level 2 —
Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations in which all significant inputs and significant value drivers are observable in active markets.
|
|
·
|
Level 3 —
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value measurements. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques based on significant unobservable inputs, as well as management judgments or estimates that are significant to valuation.
|
|
Leasehold improvements
|
3 years
|
|
Furniture and fixtures
|
7 years
|
|
Website costs
|
3 years
|
|
Computer Equipment
|
5 years
|
|
2012
|
2011
|
|||||||
|
Motorcycles and other vehicles
|
$
|
373,933
|
$
|
459,099
|
||||
|
Less: accumulated depreciation
|
(120,151
|
)
|
(217,885
|
)
|
||||
|
Motorcycles and other vehicles, net of accumulated depreciation
|
253,782
|
241,214
|
||||||
|
Less: estimated reserve for residual values
|
(10,498
|
)
|
(9,650
|
)
|
||||
|
Motorcycles and other vehicles under operating leases, net
|
$
|
243,284
|
$
|
231,564
|
||||
|
Year ending April 30,
|
||||
|
2013
|
$
|
60,053
|
||
|
2014
|
37,125
|
|||
|
2015
|
3,713
|
|||
|
2016
|
1,579
|
|||
|
Total
|
$
|
102,470
|
||
|
Year ending April 30,
|
||||
|
2013
|
$
|
270,378
|
||
|
2014
|
29,466
|
|||
|
2015
|
5,667
|
|||
|
2016
|
-
|
|||
|
Total Due
|
$
|
305,511
|
||
|
April 30,
|
April 30,
|
|||||||
|
2012
|
2011
|
|||||||
|
Current
|
$
|
273,204
|
$
|
801,953
|
||||
|
31-60 days past due
|
1,680
|
37,854
|
||||||
|
61-90 days past due
|
3,628
|
22,394
|
||||||
|
91-120 days past due
|
5,486
|
22,773
|
||||||
|
283,998
|
884,974
|
|||||||
|
Paying deficiency receivables*
|
21,513
|
15,320
|
||||||
|
$
|
305,511
|
$
|
900,294
|
|||||
|
* Paying deficiency are receivables resulting from RISC contract terminations which were terminated for less than the required termination amount and on which the customer is making payments pursuant to written or oral agreements with the Company. The Company’s policy is to write-off any deficiency receivable over 120 days old and on which the customer has not made any payments in the last 120 days.
|
||||||||
|
April 30,
|
April 30,
|
|||||||
|
2012
|
2011
|
|||||||
|
Balance at beginning of year
|
$
|
45,015
|
$
|
132,000
|
||||
|
Provision for credit losses
|
32,922
|
9,179
|
||||||
|
Charge-offs
|
(62,661
|
) |
(96,164
|
)
|
||||
|
Recoveries*
|
-
|
-
|
||||||
|
Balance at end of period
|
$
|
15,276
|
$
|
45,015
|
||||
|
* Recoveries are credited to deficiency receivables
|
||||||||
|
April 30,
|
April 30,
|
|||||||
|
2012
|
2011
|
|||||||
|
Gross balance of repossessions in inventory
|
$
|
31,833
|
$
|
14,138
|
||||
|
Allowance for losses on repossessed inventory
|
(5,948
|
) |
(1,012
|
)
|
||||
|
Net repossessed inventory
|
$
|
25,885
|
$
|
13,126
|
||||
|
2012
|
2011
|
|||||||
|
Computer equipment, software and furniture
|
$
|
209,341
|
$
|
191,247
|
||||
|
Less: accumulated depreciation
|
(187,842
|
) |
(176,677
|
)
|
||||
|
Net property and equipment
|
$
|
21,499
|
$
|
14,570
|
||||
|
2012
|
2011
|
|||||||
|
Senior secured institutional lender (a)
|
$
|
288,815
|
$
|
934,355
|
||||
|
Secured, subordinated individual lender (a)
|
208,561
|
-
|
||||||
|
Secured, subordinated individual lender (b)
|
18,636
|
40,007
|
||||||
|
Total
|
$
|
516,012
|
$
|
974,362
|
||||
|
(a)
|
The Company finances certain of its leases through two third parties. The repayment terms are generally one year to five years and the notes are secured by the underlying assets. The weighted average interest rate at April 30, 2012 is 12.29%.
|
|
(b)
|
On October 31, 2008, the Company purchased certain loans secured by a portfolio of secured motorcycle leases (“Purchased Portfolio”) for a total purchase price of $100,000. The Company paid $80,000 at closing, $10,000 in April 2009 and agreed to pay the remaining $10,000 upon receipt of additional Purchase Portfolio documentation. Proceeds from the Purchased Portfolio started accruing to the Company beginning November 1, 2008.
|
|
Year ended April 30,
|
Amount
|
|||
|
2013
|
$
|
359,819
|
||
|
2014
|
134,868
|
|||
|
2015
|
21,325
|
|||
|
2015
|
-
|
|||
|
2016
|
-
|
|||
|
Total Due
|
$
|
516,012
|
||
|
Notes Payable
|
April 30,
2012
|
April 30,
2011
|
||||||
|
Convertible notes
|
$
|
-
|
$
|
839,938
|
||||
|
Notes payable
|
-
|
60,000
|
||||||
|
Bridge loans
|
-
|
206,000
|
||||||
|
Collateralized note
|
-
|
220,000
|
||||||
|
Convertible note
|
-
|
103,399
|
||||||
|
Notes convertible at holder’s option (a)
|
1,385,671
|
-
|
||||||
|
Notes convertible at Company’s option (b)
|
25,000
|
-
|
||||||
|
Notes with interest only convertible at Company’s option (c)
|
360,000
|
-
|
||||||
|
Non convertible notes payable (d)
|
55,000
|
-
|
||||||
|
Subtotal
|
1,825,671
|
1,429,337
|
||||||
|
Less, Debt discount
|
(33,979
|
)
|
(52,272
|
)
|
||||
|
Total
|
$
|
1,791,692
|
$
|
1,377,065
|
||||
|
(a)
|
Notes convertible at holder’s option consists of: (i) a $995,105, 8% note due April 30, 2012, convertible at the holder’s option at $0.495 per share; (ii) a $37,500, 8% note due December 27, 2012, convertible at the note holder’s option at a variable conversion price such that during the period during which the notes are outstanding, with one note convertible at 58% multiplied by the average of the three lowest closing bid prices for the common stock during the ten trading day period ending one trading day prior to the submission date of the conversion notice by the note holder to the Company (the “Discount Conversion Rate”. The Company has reserved up to 991,961 shares of its common stock for conversion pursuant to the terms of the note. In the event the note is not paid when due, the interest rate is increased to twenty-two percent until the note is paid in full; (iii) a $103,399, 12% note due August 31, 2012, convertible at the holder’s option at $3.75 per share, the Company is paying 1,334 monthly penalty shares until the note is paid in full on this note which had been past due; (iv) a $25,167, 15% note due September 27, 2014 and convertible at the holder’s option at $6.44 per share. This note is being amortized over the 36 month term of the note with monthly principal and interest payments of $1,040, this note was issued during the current fiscal year and $4,833 of the note was amortized during the current fiscal year; (v) seven notes aggregating $118,250, all due October 30, 2013 with interest ranging from 15% to 20%, the Company is paying 667 monthly penalty shares until the note is paid in full on one $25,000 note which had been past due, all of the notes are convertible at the holder’s option at $0.375 per share; and (vi) three notes aggregating $106,250, all due October 30, 2013 with interest ranging from 20% to 25%, all of the notes are convertible at the holder’s option at $0.375 per share.
|
|
(b)
|
Convertible at Company’s option consists of one $25,000. 10% note due June 30, 2012 and convertible at the Company’s option at $0.6435 per share. Subsequent to April 30, 2012, this note and accrued interest thereon was paid in full.
|
|
(c)
|
Notes with interest only convertible at Company’s option consist of: (i) two 22% notes in the amounts of $10,000 due October 31, 2012, $10,000 due August 30, 2012 and $25,000 due May 1, 2011. The Company is in discussion with this latter note holder to extend the due date of the note and is paying the note holder 3,334 shares per month until the note is paid or renegotiated. Twenty-six thousand six hundred and sixty-seven shares were issued during the current fiscal year and thirteen thousand three hundred and thirty-four shares were issued in the prior fiscal year. Interest is payable at the Company’s option in cash or in shares at the rate of $1.50 per share. (ii) a $315,000, 12.462% note due April 30, 2013. Interest is payable quarterly with a minimum or $600 in cash with the balance payable in cash or stock at the Company’s option as calculated as the volume weighted average price of the Company’s common stock for the ten day trading period immediately preceding the last day of each three month period.
|
|
(d)
|
Non convertible notes consist of two notes due October 31, 2012. One note in the amount of $30,000 bears no interest; the Company has agreed to pay 2,667 monthly penalty shares until the note is paid in full on this note which had been past due. The other note is a 10% in the amount of $25,000. Company is paying 10,667 monthly penalty shares until the note is paid in full on this note which had been past due. Forty-two thousand six hundred and sixty-seven shares were issued during the current fiscal year; no shares were issued in the prior fiscal year. Subsequent to April 30, 2012, this latter note and accrued interest thereon were converted to 38,081 shares of common stock.
|
|
·
|
Issued to four note holders 1,050,384 shares of common stock upon conversion of $293,365 of notes, plus accrued interest thereon. Issued to one investor 67,740 shares of common stock upon conversion of $56,530 of accrued interest on various of the Company’s notes.
|
|
·
|
Issued 69,528 shares for note and accrued interest conversion which were booked as shares to be issued in the prior fiscal year.
|
|
·
|
Sold 654,659 shares of its restricted common stock to ten accredited investors for an aggregate purchase price of $283,855. 70,468 of the shares were classified as to be issued at April 30, 2012.
|
|
·
|
Issued 165,858 shares for common stock purchases which were booked as shares to be issued in the prior year
|
|
·
|
Pursuant to the terms of five consulting agreements, the Company issued a total of 218,211 shares of common stock valued at $126,406.
|
|
·
|
The Company issued to eight consultants, 196,734shares of common stock valued at $81,153.
|
|
·
|
Agreed to issue 8,889 shares of common stock which were classified as to be issued at April 30, 2012, valued at $10,000, for purchase assets.
|
|
·
|
Agreed to issue 21,476 shares of common stock which were classified as to be issued at April 30, 2012, to an officer of the Company in lieu of salary in the amount of $64,427.
|
|
·
|
The Company’s subsidiary, Specialty Reports, Inc. (“SRI”) sold 2.49 shares of its Series A Preferred stock to one accredited investor for $12,455. The Series A Preferred stock does not pay a dividend. Each share has a liquidating value of $5,000 and is redeemable by Specialty Reports at any time after one year. Each share is convertible at the holder’s option at any time into either 2,632 shares of Specialty Reports, Inc common stock, or 3,704 shares of Sparta Commercial Services common stock. SRI sold 63.6 shares of its Series B Preferred stock to twenty accredited investors for $328,000. The Series B Preferred stock does not pay a dividend. Each share has a liquidating value of $5,000 and is redeemable by SRI at any time after one year. Each share is convertible at the holder’s option at any time into either 2,222 shares of SRI common stock, or 2,667 shares of Sparta Commercial Services common stock. SRI sold 22 shares of its Series C Preferred stock to twenty accredited investors for $110,000. The Series C Preferred stock does not pay a dividend. Each share has a liquidating value of $5,000 and is redeemable by SRI at any time after one year. Each share is convertible at the holder’s option at any time into either 1,000 shares of SRI common stock, or 2,000 shares of Sparta Commercial Services common stock. Additionally, during the fiscal year ended April 30, 2012, SRI’s minority common stock holder returned 140,000 shares of common stock to SRI.
|
|
Amount
|
||||
|
Balance at May 1, 2010
|
$
|
-
|
||
|
Issuance of Series A Preferred Stock
|
197,000
|
|||
|
Issuance of Series B Preferred Stock
|
165,000
|
|||
|
Series B Preferred Stock to be issued
|
15,000
|
|||
|
Issuance of SRI Common stock for purchase of Cyclechex, LLC
|
6,000
|
|||
|
Noncontrolling interest’s share of losses
|
(92,211)
|
|||
|
Balance at April 30, 2011
|
$
|
290,789
|
||
|
Issuance of Series A Preferred Stock
|
12,455
|
|||
|
Issuance of Series B Preferred Stock
|
328,000
|
|||
|
Issuance of Series C Preferred Stock
|
110,000
|
|||
|
Noncontrolling interest’s share of losses
|
(38,090)
|
|||
|
$
|
703,154
|
|||
|
Fair Value at
|
Fair Value Measurement Using
|
|||||||||||||||
|
April 30,
|
||||||||||||||||
|
2012
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
|
Derivative liability
|
$
|
374,697
|
-
|
-
|
$
|
374,697
|
||||||||||
|
$
|
374,697
|
-
|
-
|
$
|
374,697
|
|||||||||||
|
Fiscal Year ended April 30,
|
||||||||
|
2012
|
2011
|
|||||||
|
Revenues:
|
||||||||
|
SRI
|
289,628 | 52,911 | ||||||
|
SCS
|
312,204 | 460,857 | ||||||
|
Total Revenue
|
$ | 601,832 | $ | 513,768 | ||||
|
Gross Profit:
|
||||||||
|
SRI
|
(193,315 | ) | (52,836 | ) | ||||
|
SCS
|
n/a | n/a | ||||||
|
Total Gross Profit
|
$ | (193,315 | ) | $ | (52,836 | ) | ||
|
Operating (loss):
|
||||||||
|
SRI
|
(113,668 | ) | (180,213 | ) | ||||
|
SCS
|
(1,577,446 | ) | (2,193,550 | ) | ||||
|
Total Operating (loss)
|
$ | (1,691,114 | ) | $ | (2,373,763 | ) | ||
|
Interest Income:
|
||||||||
|
SRI
|
- | - | ||||||
|
SCS
|
273,639 | 378,385 | ||||||
|
Total interest income
|
$ | 273,639 | $ | 378,385 | ||||
|
Interest Expense:
|
||||||||
|
SRI
|
- | - | ||||||
|
SCS
|
486,242
|
394,384 | ||||||
|
Total interest expense
|
$ |
486,242
|
$ | 394,384 | ||||
|
Assets:
|
||||||||
|
SRI
|
161,874 | 136,414 | ||||||
|
SCS
|
727,856 | 1,351,139 | ||||||
|
Total assets
|
$ | 889,730 | $ | 1,487,553 | ||||
|
Capital expenditures:
|
||||||||
|
SRI
|
- | - | ||||||
|
SCS
|
8,094 | - | ||||||
|
Total capital expenditures
|
$ | 8,094 | $ | - | ||||
|
Operating Expenses:
|
||||||||
|
SRI
|
306,984 | 133,049 | ||||||
|
SCS
|
1,909,452 | 2,662,088 | ||||||
|
Total operating expenses
|
$ | 2,216,436 | $ | 2,795,137 | ||||
|
Depreciation and Amortization:
|
||||||||
|
SRI
|
- | - | ||||||
|
SCS
|
76,510 | 92,394 | ||||||
|
Total depreciation and amortization
|
$ | 76,510 | $ | 92,394 | ||||
| All of the Company's assets as of April 30, 2012 and 2011were attributable to U.S. operations. | ||||||||
| SRI commenced operations in May 2010 and is 90% owned by the Company. | ||||||||
|
April 30,
|
||||||||
|
2012
|
2011
|
|||||||
|
Noncurrent:
|
||||||||
|
Net operating loss carry forward
|
$
|
7,305,634
|
$
|
7,815,196
|
||||
|
Valuation allowance
|
(7.305,634
|
)
|
(7,815,196
|
)
|
||||
|
Net deferred tax asset
|
$
|
-
|
$
|
-
|
||||
|
Options Outstanding
|
Options Exercisable
|
|||||||||||||||||
|
Number
Outstanding
|
Weighted Average
Remaining Contractual
Life (Years)
|
Weighted
Average
Exercise
Price
|
Number
Exercisable
|
Weighted
Average
Exercise
Price
|
||||||||||||||
|
394,000
|
2.99
|
$
|
3.75
|
247,864
|
$
|
5.25
|
||||||||||||
|
Number
of Shares
|
Weighted Average
Price
Per Share
|
|||||||
|
Outstanding at April 30, 2010
|
73,334
|
$
|
17.25
|
|||||
|
Granted
|
312,000
|
1.875
|
||||||
|
Exercised
|
-
|
-
|
||||||
|
Canceled or expired
|
(2,334
|
)
|
(45.375
|
)
|
||||
|
Outstanding at April 30, 2011
|
383,000
|
$
|
4.50
|
|||||
|
Granted
|
26,667
|
0.60
-
|
||||||
|
Exercised
|
-
|
-
|
||||||
|
Canceled or expired
|
(15,667
|
)
|
(20.25
|
)
|
||||
|
Outstanding at April 30, 2012
|
394,000
|
$
|
3.75
|
|||||
|
Significant Assumptions (weighted average):
|
2012
|
2011
|
||||||
|
Risk free interest rate at grant date:
|
0.41
|
%
|
1.023
|
%
|
||||
|
Expected stock price volatility
|
227
|
%
|
252
|
%
|
||||
|
Expected dividend payout
|
0
|
0
|
||||||
|
Expected options life in years(a)
|
3.00
|
2.91
|
||||||
|
(a) The expected option life is based on vested dates. The Company expensed $173,105 and $103,589 in the fiscal years ending April 30, 2011 and 2012, respectively, as the value of options issued to directors, officers and employees.
|
||||||||
|
Warrants Outstanding
|
Warrants Exercisable
|
|||||||||||||||||||||
|
Exercise
Prices
|
Number
Outstanding
|
Weighted
Average
Remaining
Contractual Life
(Years)
|
Weighted
Average
Exercise
Price
|
Number
Exercisable
|
Weighted
Average
Exercise
Price
|
|||||||||||||||||
|
$
|
11.25
|
84,842
|
0.17
|
$
|
11.25
|
84,842
|
$
|
11.25
|
||||||||||||||
|
$
|
8.25
|
3,334
|
|
1.05
|
$
|
8.25
|
3,334
|
$
|
8.25
|
|||||||||||||
|
$
|
5.25
|
307,939
|
1.20
|
$
|
5.25
|
307,939
|
$
|
5.25
|
||||||||||||||
|
$
|
4.95
|
6,667
|
0.51
|
$
|
4.95
|
6,667
|
$
|
4.95
|
||||||||||||||
|
$
|
3.75
|
21,000
|
0.66
|
$
|
3.75
|
21,000
|
$
|
3.75
|
||||||||||||||
|
$
|
3.285
|
21,772
|
0.76
|
$
|
3.285
|
21,772
|
$
|
3.285
|
||||||||||||||
|
$
|
1.275
|
25,938
|
3.74
|
$
|
1.275
|
25,938
|
$
|
1.275
|
||||||||||||||
|
$
|
0.75
|
21,680
|
4.38
|
$
|
0.75
|
21,680
|
$
|
0.75
|
||||||||||||||
|
$
|
0.60
|
20,000
|
4.92
|
$
|
0.60
|
20,000
|
$
|
0.60
|
||||||||||||||
|
513,172
|
1.34
|
$
|
5.25
|
513,172
|
$
|
5.25
|
||||||||||||||||
|
Number
of
Shares
|
Weighted
Average
Price Per
Share
|
|||||||
|
Outstanding at April 30, 2010
|
310,590
|
$
|
7.50
|
|||||
|
Granted
|
196,968
|
4.50
|
||||||
|
Exercised
|
-
|
-
|
||||||
|
Canceled or expired
|
(28,741
|
)
|
(13.50
|
) | ||||
|
Outstanding at April 30, 2011
|
478,817
|
5.25
|
||||||
|
Granted
|
43,641
|
0.705
|
||||||
|
Exercised
|
-
|
-
|
||||||
|
Canceled or expired
|
(9,286
)
|
(11.25
|
)
|
|||||
|
Outstanding at April 30, 2012
|
513,172
|
$
|
5.25
|
|||||
|
2012
|
2011
|
|||||||
|
Significant assumptions (weighted-average):
|
||||||||
|
Risk-free interest rate at grant date
|
1.061
|
%
|
1.37
|
%
|
||||
|
Expected stock price volatility
|
300
|
%
|
332
|
%
|
||||
|
Expected dividend payout
|
-
|
-
|
||||||
|
Expected option life-years
|
3 yrs
|
3 yrs
|
||||||
|
·
|
issued four warrants to purchase an aggregate of 43,641 shares of common stock to a consultant valued at $33,006.
|
|
·
|
agreed to issue 8,889 shares of common stock, which were classified as to be issued at April 30, 2012, valued at $10,000, for purchase of assets.
|
|
·
|
issued pursuant to notes and penalty provisions of notes, 143,774 shares of unregistered common stock, valued at $116,153. |
|
·
|
issued 283,334 stock options to six officers and directors, exercisable at $1.875 per share until May 12, 2015, subject to vesting at the rate of 20% on the grant date, 40% on May 12, 2012, and 40% on May 12, 2012. The vested and unvested options were initially valued at $409,790.
|
|
·
|
issued to four employees under the Company’s 2005 Stock Incentive Compensation Plan options to purchase a total of 28,667 shares of common stock at $1.65 per share until December 1, 2018, subject to vesting at the rate of 40% on the grant date, 20% on December 1, 2012, 20% on December 1, 2012 and 20% on December 1, 2013. The vested and unvested options were initially valued at $42,961.
|
|
·
|
in connection with the sale of common stock, issued three year warrants to purchase 172,991 shares of its common stock at $5.25 per share, to six accredited investors. The warrants have been valued at $340,521.
|
|
·
|
issued five warrants to purchase an aggregate of 23,978 shares of common stock to a consultant. The warrants have been valued at $105,235.
|
|
·
|
issued pursuant to notes and penalty provi
s
ions of notes, 76,080 shares of unregistered common stock, valued at $116,788, 5,267 of the shares were classified as shares to be issued.
|
|
·
|
issued to members of its Advisory Council,
three consultants, and pursuant to three consulting agreements a total of 254,134 shares of its common stock valued at $279,785,
13,334
of the shares had been accrued in the prior year.
|
|
·
|
sold to eleven accredited investors 269,586 shares of restricted common stock for $192,000,
|
|
·
|
sold a $30,000, 15% note convertible note due May 24, 2015, convertible at the holder’s option and amortizing over 36 months at $1,040 per month. On July 12, 2012, this investor agreed to convert the outstanding balances of this note and a similar note issued in September 2011, aggregating $53,042, into 62,403 shares of common stock,
|
|
·
|
sold a $53,000, 8% note due March 18, 2013, convertible at the note holder’s option at a variable conversion price such that during the period during which the notes are outstanding, with one note convertible at 58% multiplied by the average of the three lowest closing bid prices for the common stock during the ten trading day period ending one trading day prior to the submission date of the conversion notice by the note holder to the Company (the “Discount Conversion Rate”. The Company has reserved up to 991,961 shares of its common stock for conversion pursuant to the terms of this and one other note held by this creditor. In the event the notes are not paid when due, the interest rate is increased to twenty-two percent until the note is paid in full,
|
|
·
|
one $25,000 note plus accrued interest thereon was converted into 38,086 shares,
|
|
·
|
repaid in full one $25,000 note plus accrued interest thereon,
|
|
·
|
Specialty Reports, Inc sold four accredited investors, 11 shares of its Series C Convertible preferred stock for $55,000.
|
|
●
|
lack of documented policies and procedures;
|
|
|
●
|
we have no audit committee;
|
|
|
●
|
there is a risk of management override given that our officers have a high degree of involvement in our day to day operations.
|
|
|
●
|
there is no effective separation of duties, which includes monitoring controls, between the members of management.
|
|
Name
|
Age
|
Position
|
||
|
Anthony L. Havens
|
58
|
Chief Executive Officer, President, and Chairman
|
||
|
Kristian Srb
|
57
|
Director
|
||
|
Jeffrey Bean
|
59
|
Director
|
||
|
Anthony W. Adler
|
72
|
Executive Vice President and Principal Financial Officer
|
||
|
Richard P. Trotter
|
69
|
Chief Operating Officer
|
||
|
Sandra L. Ahman
|
49
|
Vice President, Secretary and Director
|
|
Name and Principal Position
|
Year
|
Salary
($)(a)
|
Bonus
($)
|
Stock
Awards
($)(b)
|
Option
Awards
($)(b)(c)
|
All Other
Compensation
($)(d)
|
Total
($)
|
|||||||||||||||||||
|
Anthony L. Havens
|
2012
|
280,000 | 41,612 | 0 | 12,267 | 333,879 | ||||||||||||||||||||
|
Chief Executive Officer
|
2011
|
280,000 | 89,514 | 0 | 128,671 | 11,005 | 509,190 | |||||||||||||||||||
|
Anthony W. Adler
|
2012
|
185,000 | 0 | 0 | 0 | 185,000 | ||||||||||||||||||||
|
Executive Vice President and
Principal Financial Officer
|
2011
|
185,000 | 0 | 0 | 77,039 | 0 | 262,039 | |||||||||||||||||||
|
Richard P. Trotter
|
2012
|
150,000 | 0 | 0 | 0 | 150,000 | ||||||||||||||||||||
|
Chief Operating Officer
|
2011
|
170,833 | 0 | 0 | 77,448 | 0 | 248,281 | |||||||||||||||||||
|
(a)
|
For Mr. Adler includes accrued; unpaid net salary of $114,651 and $52,609 at year end 2012 and 2011, respectively. For Mr. Trotter, includes accrued; unpaid net salary of $48,723 at year end 2012. During fiscal 2012, Mr. Trotter agreed to accept 21,476 shares of common stock in lieu of accrued but unpaid salary in the amount of $64,427 and Mr. Trotter agreed to forgive $100,000 of accrued salary.
|
|
(b)
|
Represents the stock-based compensation recognized in accordance with ASC 718. Stock-based awards are valued at the fair value on the grant date using a Black-Scholes model. Assumptions made in the valuation of stock-based awards are discussed in Note M to the consolidated financial statements.
|
|
(c)
|
On May 12, 2011, the Company issued stock options to its key executives, exercisable at $1.875 per share until May 12, 2015, subject to vesting at the rate of 20% on the grant date, 40% on May 12, 2012, and 40% on May 12, 2012, of which 88,967 options were issued to Mr. Havens, 53,267 options were issued to Mr. Adler, and 53,550 options were issued to Mr. Trotter.
|
|
(d)
|
This column reports the total amount of perquisites and other benefits provided, if such total amount exceed $10,000. In fiscal 2012, for Mr. Havens, this includes $12,267 for garage and storage rental and $11,005 in garage rental for fiscal 2011.
|
|
|
·
|
a change in voting power, due to a person becoming the beneficial owner of 50% or more of the voting power of our securities and our largest stockholder;
|
|
|
·
|
during any period of two consecutive years, individuals who at the beginning of such period constitute the Board of Directors, including later approved directors, ceasing to constitute a majority of the board;
|
|
|
·
|
a merger or consolidation of our company with a third party, after which our stockholders do not own more than 50% of the voting power; or
|
|
|
·
|
a sale of all or substantially all of our assets to a third party.
|
|
Option Awards
|
Stock Awards
|
||||||||||||||||||||
|
Name
|
Number of
securities
underlying
unexercised
options
(#)
Exercisable
|
Number of
securities
underlying
unexercised
options
(#)
Unexercisable
|
Option
exercise
price
($)
|
Option
expiration
date
|
Number of
shares or units
of stock that
have not vested
(#)
|
Market value
of shares or
units of stock
that have
not vested
($)
|
|||||||||||||||
|
Anthony L. Havens (1)
|
53,380
|
35,587
|
1.875
|
5/12/2015
|
-
|
-
|
|||||||||||||||
|
Anthony W. Adler (2)
|
42,667
|
-
|
14.355
|
9/21/2012
|
|||||||||||||||||
|
Anthony W. Adler (1)
|
31,960
|
21,307
|
1.875
|
5/12/2015
|
-
|
-
|
|||||||||||||||
|
Richard P. Trotter (1)
|
32,130
|
21,420
|
1.875
|
5/12/2015
|
-
|
-
|
|||||||||||||||
|
Richard P. Trotter (3)
|
2,334
|
-
|
45.375
|
4/29/2013
|
-
|
-
|
|||||||||||||||
|
Richard P. Trotter (3)
|
2,334
|
-
|
45.375
|
4/29/2014
|
-
|
-
|
|||||||||||||||
|
(1)
|
Granted pursuant to an option agreement dated May 12, 2011. The options are exercisable, subject to vesting, for a period of five years from the grant date at $1.875 per share.
|
|
(2)
|
Granted pursuant to an option agreement dated September 22, 2006. The options are exercisable for a period of five years from the vesting date at $14.355 per share.
|
|
(3)
|
Granted pursuant to an option agreement dated April 29, 2005.
|
|
Name
|
Fees earned
or paid in cash
($)
|
Stock
awards
($)(a)
|
Option
awards
($)(b)
|
All other
compensation
($)
|
Total
($)
|
|||||||||||||||
|
Jeffrey Bean
|
0
|
0
|
5,955
|
–
|
5,955
|
|||||||||||||||
|
Kristian Srb
|
0
|
0
|
5,955
|
–
|
5,955
|
|||||||||||||||
|
(a)
|
Represents the stock-based compensation recognized in accordance with ASC 718. Stock-based awards are valued at the fair value on the grant date using a Black-Scholes model. Assumptions made in the valuation of stock-based awards are discussed in Note M to the consolidated financial statements.
|
|
(b)
|
On November 22, 2011, the Company issued two stock options, exercisable at $0.60 per share until November 22, 2016, subject to vesting at the rate of 20% on the grant date, 40% on November 22, 2012, and 40% on November 22, 2013, as follows:
13.334
options each to Mr. Bean and to Mr. Srb.
|
|
Plan category
|
Number of securities to be
issued upon exercise of
outstanding options,
warrants and rights (a)
|
Weighted-average exercise
price of outstanding options,
warrants and rights (b)
|
Number of securities
remaining available for
future issuance under
equity compensation plan
|
|||||||||
|
Equity compensation plans
approved by securities holders
|
32,667
|
$
|
2.25
|
80,667
|
||||||||
|
Equity compensation plans not
approved by security holders
|
847,866
|
$
|
5.25
|
81,670
|
||||||||
|
Total
|
880,533
|
$
|
5.25
|
162,336
|
||||||||
|
(a)
|
For purposes of the table, does not include shares issued and outstanding pursuant neither to the Company’s 2009 Consultant Stock Plan, nor 1,334 shares vested pursuant to a restricted stock grant.
|
|
(b)
|
Calculation excludes shares issued pursuant to stock grants.
|
|
Name (a)
|
Number of Shares
Beneficially Owned
|
Percentage of Class
Beneficially Owned
|
||||||
|
Anthony L. Havens (1)
|
474,744
|
5.4
|
||||||
|
Kristian Srb (2)
|
485,977
|
5.6
|
||||||
|
Jeffrey Bean (3)
|
30,699
|
0.4
|
||||||
|
Anthony W. Adler (4)
|
153,712
|
1.8
|
||||||
|
Richard P. Trotter (5)
|
123,737
|
1.4
|
||||||
|
Sandra L. Ahman (6)
|
49,678
|
0.6
|
||||||
|
Arthur O. Silver Trust (7)
|
685,634
|
7.6
|
||||||
|
11500 King Street
|
||||||||
|
Franklin Park, IL 60131
|
||||||||
|
Glenn A. Little (8)
|
2,928,626
|
25.9
|
||||||
|
P.O. Box 1271
|
||||||||
|
Midland, TX 79702
|
||||||||
|
Entities controlled by John W. Russell (9)
|
717,642
|
8.2
|
||||||
|
116A Main Street
|
||||||||
|
Tiburon, CA 94920
|
||||||||
|
All current directors and named officers as a group (6 in all)
|
1,318,547
|
14.6
|
||||||
|
(a)
|
Unless indicated otherwise, the address for each person named in the table is c/o Sparta Commercial Services, Inc., 462 Seventh Ave, 20th Floor, New York, NY 10018.
|
|
(1)
|
Mr. Havens' minor son owns approximately 13,334 shares of common stock in a trust account. Mr. Havens is not the trustee for his son's trust account, and does not have the sole or shared power to vote or direct the vote of such shares. Mr. Havens disclaims beneficial ownership of such shares held in his son's trust account.
|
|
|
Includes 53,380 vested options, and 35,587 options subject to vesting on May 12, 2012, all exercisable at $1.875 per share until May 12, 2015.
|
|
(2)
|
Includes 834 shares of common stock held by Mr. Srb's minor daughter, for which Mr. Srb may be deemed to have beneficial ownership of such shares. Includes 19,720 vested options, and 13,147 options subject to vesting on May 12, 2012, all exercisable at $1.875 per share until May 12, 2015. And, 2,667 vested stock options, 5,334 options subject to vesting on November 22, 2012, and 5,334 options subject to vesting on November 22, 2013, all exercisable at $0.60 until November 22, 2016.
|
|
(3)
|
Includes 4,000 vested stock options, exercisable at $9.0 per share until October 23, 2012, and 7,650 vested options, and 5,100 options subject to vesting on May 12, 2012, all exercisable at $1.875 per share until May 12, 2015. And, 2,667 vested stock options, 5,334 options subject to vesting on November 22, 2012, and 5,334 options subject to vesting on November 22, 2013, all exercisable at $0.60 until November 22, 2016.
|
|
(4)
|
Includes 42,667 vested stock options, exercisable at $14.355 per share until September 22, 2012, and 44,445 shares held by The Anthony W. Adler Irrevocable Trust, dated October 1, 2009. Includes 31,960 vested options, and 21,307 options subject to vesting on May 12, 2012, exercisable at $1.875 per share until May 12, 2015.
|
|
(5)
|
Includes 1,667 vested shares, of which only 334 of such vested shares have been issued to date, 4,667 vested stock options, exercisable at $45.375 per share and expiring at the rate of 2,334 on each of April 29, 2013, and 2014, and 44,445 shares held by The Richard and Kay Trotter Trust Established March 18, 2009. Includes 21,476 shares to be issued to Mr. Trotter in lieu of salary. Includes 21,420 vested options, and 21,420 options subject to vesting on May 12, 2012, all exercisable at $1.875 per share until May 12, 2015.
|
|
(6)
|
Includes 25,164 vested options, and 16,774 options subject to vesting on May 12, 2012, all exercisable at $1.875 per share until May 12, 2015.
|
|
(7)
|
Includes 33,206 vested warrants exercisable at $11.25 per share, 7,937 expiring May 5, 2012, 16,667 expiring June 4, 2012 and 8,602 expiring July 8, 2012, and 133,918 vested warrants exercisable at $5.25 per share, 26,411 expiring March 24, 2013, 36,248 expiring April 28, 2013, 18,519 expiring June 13, 2013, and 52,740expiring December 30, 2013. Includes 47,734 shares to be issued. Includes 39,502 shares subject to convertible notes held by the Trust which are convertible at the option of the holder and 66,371 shares subject to conversion of convertible preferred shares of Specialty Reports, Inc. held by the Trust and convertible at the option of the holder.
|
|
(8)
|
Includes 542,075 shares to be issued. Includes 2,776 vested warrants exercisable at $11.25 per share until July 24, 2012. Includes 2,079,889 shares subject to conversion of convertible notes held by Mr. Little which are convertible to the option of the holder.
|
|
(9)
|
Includes 40,000 shares to be issued. and 33,3340 vested warrants exercisable at $5.27 per share, 11,112 expiring June 15, 2013 and 22,222 expiring June 21, 2013. Includes 43,556 shares subject to conversion of convertible preferred shares of Specialty Reports, Inc. held by the entities and convertible at the option of the holder
|
|
Exhibit Number
|
Description of Exhibit
|
|
|
3(i)(1)
|
Articles of Incorporation of Tomahawk Oil and Minerals, Inc. (Incorporated by reference to Exhibit 3(i) (1) of Form 10-KSB filed on August 13, 2004)
|
|
|
3(i)(2)
|
Certificate of Amendment of Articles of Incorporation, November 1983 (Incorporated by reference to Exhibit 3(i) (2) of Form 10-KSB filed on August 13, 2004)
|
|
|
3(i)(3)
|
Certificate of Amendment of Articles of Incorporation for name change, August 2004 (Incorporated by reference to Exhibit 3(i) of Form 8-K filed on August 27, 2004)
|
|
|
3(i)(4)
|
Certificate of Amendment of Articles of Incorporation for increase in authorized capital, September 2004 (Incorporated by reference to Exhibit 3(i) of Form 8-K filed on September 17, 2004)
|
|
|
3(i)(5)
|
Certificate of Amendment of Articles of Incorporation for decrease in authorized capital, December 2004 (Incorporated by reference to Exhibit 3(i) of Form 8-K filed on December 23, 2004)
|
|
|
3(i)(6)
|
Certificate of Designation for Series A Redeemable Preferred Stock, December 2004 (Incorporated by reference to Exhibit 3(i) of Form 8-K filed on January 4, 2005)
|
|
|
3(i)(7)
|
Certificate of Designation for Series B Preferred Stock (Incorporated by reference to Exhibit B to Preferred Stock Purchase Agreement, dated as of July 29, 2009 (see Exhibit 10.21 below)
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3(i)(8)
|
Certificate of Amendment of Articles of Incorporation for increase in authorized capital, September 21, 2009 (Incorporated by reference to Exhibit 3(i)(8) of Form S-1 filed on October 2, 2010)
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3(i)(9)
|
Certificate of Designations of Series C Convertible Preferred Stock (Incorporated by reference to Exhibit 5.03(i) of Form 8-K filed on November 19, 2009)
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3(ii)(1)
|
By-laws (Incorporated by reference to Exhibit 3(ii) (1) of Form 10-KSB filed on August 13, 2004)
|
|
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3(ii)(2)
|
By-laws Resolution (Incorporated by reference to Exhibit 3(ii) (2) of Form 10-KSB filed on August 13, 2004)
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3(ii)(3)
|
Board of Directors Resolutions amending By-laws (Incorporated by reference to Exhibit 3(ii) of Form 10-QSB filed on December 15, 2004)
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|
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10.1
|
Lease for office facilities (Incorporated by reference to Exhibit 10 of Form 10-QSB filed on December 15, 2004)
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10.2+
|
Form of Employment Agreement with Anthony Havens (Incorporated by reference to Exhibit 10.4 of Form 10-KSB filed on August 13, 2004)
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|
10.3+
|
Employment Agreement with Richard Trotter (Incorporated by reference to Exhibit 10 of Form 8-K filed on October 29, 2004)
|
|
|
10.4+
|
Option Agreement with Richard Trotter (Incorporated by reference to Exhibit 10.1 of Form 8-K filed on May 5, 2005)
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|
|
10.5+
|
Employment Agreement with Anthony W. Adler (Incorporated by reference to Exhibit 10.1 of Form 8-K filed on October 2, 2006)
|
|
|
10.6+
|
Stock Option Agreement with Jeffrey Bean, dated October 23, 2006 (Incorporated by reference to Exhibit 10.1 of Form 8-K filed on October 24, 2006)
|
|
|
10.7+
|
2005 Stock Incentive Compensation Plan (Incorporated by reference to Exhibit 4 of Form 10-KSB filed on August 13, 2004)
|
|
|
10.8
|
2010 Consultant Stock Plan (Incorporated by reference to Exhibit 99.1 of Form S-8 filed on May 12, 2010)
|
|
|
10.9
|
Master Loan and Security Agreement - Motor Vehicles (Incorporated by reference to Exhibit 10.1 of Form 8-K filed on July 28, 2005)
|
|
|
10.10
|
Master Loan and Security Agreement (Installment Sale Contract) (Incorporated by reference to Exhibit 10.2 of Form 8-K filed on July 28, 2005
|
|
|
10.11
|
Form of Loan Agreement, December 2005 (Incorporated by reference to Exhibit 10.1 of Form 10-QSB filed on March 22, 2006)
|
|
|
10.12
|
Form of Promissory Note (Incorporated by reference to Exhibit 10.3 of Form 10-QSB filed on December 18, 2006)
|
|
|
10.13
|
Form of Promissory Note (Incorporated by reference to Exhibit 10.4 of Form 10-QSB filed on December 18, 2006)
|
|
|
10.14
|
Form of Convertible Debenture (Incorporated by reference to Exhibit 10.1 of Form 10-QSB filed on December 21, 2007)
|
|
|
10.15
|
Preferred Stock Purchase Agreement, dated as of July 29, 2009, by and among Sparta Commercial Services, Inc. and Optimus Capital Partners, LLC (Incorporated by reference to Exhibit 10.1 of Form 8-K filed on July 30, 2009)
|
|
|
10.16
|
Motorcycle Lease Warehousing Master Lease Funding Agreement dated September 28, 2010 between registrant and Vion Operations LLC (Incorporated by reference to Exhibit 10 of Form 8-K filed on September 29, 2010)
|
|
|
10.17
|
Motorcycle Lease Warehousing Master Services Agreement dated September 28, 2010 between registrant and Vion Operations LLC (Incorporated by reference to Exhibit 10.2 of Form 8-K filed on September 29, 2010)
|
|
|
11
|
Statement re: computation of per share earnings is hereby incorporated by reference to Part II, Item 8 of this report
|
|
|
14.1
|
Code of Ethics (Incorporated by reference to Exhibit 14.1 of Form 10-K filed on August 15, 2011)
|
|
|
21.1*
|
||
|
23.1*
|
||
|
31.1*
|
||
|
31.2*
|
||
|
32.1*
|
||
|
32.2*
|
||
| 101.INS* |
XBRL Instance Document
|
|
| 101.SCH* |
XBRL Taxonomy Extension Schema
|
|
| 101.CAL* |
XBRL Taxonomy Extension Calculation Linkbase
|
|
| 101.DEF* |
XBRL Taxonomy Extension Definition Linkbase
|
|
| 101.LAB* |
XBRL Taxonomy Extension Label Linkbase
|
|
| 101.PRE* |
XBRL Taxonomy Extension Presentation Linkbase
|
|
SPARTA COMMERCIAL SERVICES, INC.
|
|||
|
By:
|
/s/ Anthony L. Havens
|
||
|
Anthony L. Havens
|
|||
|
Chief Executive Officer
|
|||
|
Date: August 14, 2012
|
|||
|
By:
|
/s/ Anthony L. Havens
|
||
|
Anthony L. Havens
|
|||
|
Chief Executive Officer, President
|
|||
|
and Chairman of the Board
|
|||
|
Date: August 14, 2012
|
|||
|
By:
|
/s/ Anthony W. Adler
|
||
|
Anthony W. Adler
|
|||
|
Executive Vice President, and
|
|||
|
Interim Principal Financial Officer
|
|||
|
Date: August 14, 2012
|
|||
|
By:
|
/s/ Sandra L. Ahman
|
||
|
Sandra L. Ahman
|
|||
|
Vice President and Director
|
|||
|
Date: August 14, 2012
|
|||
|
By:
|
/s/ Kristian Srb
|
||
|
Kristian Srb
|
|||
|
Director
|
|||
|
Date: August 14, 2012
|
|||
|
By:
|
/s/ Jeffrey Bean
|
||
|
Jeffrey Bean
|
|||
|
Director
|
|||
|
Date: August 14, 2012
|
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
| FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
|---|
| DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
|---|
No information found
No Customers Found
No Suppliers Found
Price
Yield
| Owner | Position | Direct Shares | Indirect Shares |
|---|