(MARK
ONE)
|
|
x
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
|
For
the fiscal year ended December 31,
2006
|
OR
|
|
|
|
o
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
|
For
the transition period from ______________ to
______________
|
Delaware
|
20-1915083
|
(State
or other jurisdiction of
incorporation
or organization)
|
(IRS
Employer
Identification
No.)
|
7030
Hayvenhurst Avenue, Van Nuys, California
|
91406
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Title
of each class
|
Name
of each exchange on which registered
|
Common
Stock, $0.0001 Par Value
|
None
|
|
|
PAGE
|
PART
I.
|
|
|
|
|
|
Item
1.
|
3
|
|
Item
2.
|
10
|
|
Item
3.
|
12
|
|
Item
4.
|
12
|
|
|
|
|
PART
II.
|
|
|
|
|
|
Item
5.
|
13
|
|
Item
6.
|
14
|
|
Item
7.
|
26
|
|
Item
8.
|
46
|
|
Item
8A.
|
46
|
|
Item
8B.
|
46
|
|
|
|
|
PART
III.
|
|
|
|
|
|
Item
9.
|
46
|
|
Item
10.
|
48
|
|
Item
11.
|
52
|
|
Item
12.
|
53
|
|
Item
13.
|
56
|
|
Item
14.
|
57
|
|
|
|
|
·
|
changes
in general or local economic
conditions;
|
·
|
changes
in supply of or demand for similar or competing properties in the
area;
|
·
|
bankruptcies,
financial difficulties or lease defaults by
customers;
|
·
|
changes
in interest rates and availability of permanent mortgage financing
that
may render the sale of a property difficult or unattractive or otherwise
reduce the returns to stockholders;
|
·
|
changes
in governmental rules, regulations, and fiscal policies, including
changes
in tax, real estate, environmental, and zoning
laws;
|
·
|
periods
of high interest rates and tight money
supply.
|
Period
Ended
|
Inventory
|
Inventory
Value
|
||||
Year
Ended 12/31/05
|
Individual
Lots
|
$
|
1,137,625
|
|||
(audited)
|
Bulk
Tracts
|
1,298,853
|
||||
|
$
|
2,436,478
|
||||
Period
Ended 12/31/06
|
Individual
Lots
|
$
|
2,047,541
|
|||
(audited)
|
Bulk
Tracts
|
1,189,722
|
||||
$
|
3,237,263
|
Actively
Marketed
|
Being
Prepared for Marketing
|
Total
|
|||||||
Arizona
|
$
|
29,614
|
$
|
-
|
$
|
29,614
|
|||
Colorado
|
314,128
|
-
|
314,128
|
||||||
Florida
|
19,600
|
-
|
19,600
|
||||||
Mexico
|
-
|
298,348
|
298,348
|
||||||
Michigan
|
15,919
|
-
|
15,919
|
||||||
Nevada
|
-
|
855,476
|
855,476
|
||||||
New
Mexico
|
60,285
|
-
|
60,285
|
||||||
Oklahoma
|
21,917
|
-
|
21,917
|
||||||
Pennsylvania
|
359,512
|
32,748
|
392,260
|
||||||
Texas
|
1,226,566
|
3,150
|
1,229,716
|
||||||
Total
|
$
|
2,047,541
|
$
|
1,189,722
|
$
|
3,237,263
|
Votes
For
|
Votes
Against
|
Abstentions
|
||
8,404,682
|
None
|
None
|
Quarter
Ended
|
Price
Range(4)
|
|||
|
High($)
|
Low($)
|
||
|
Quarter
ended 12/31/04
|
(1)
(2)
|
$
65.00
|
$
11.00
|
|
Quarter
ended 3/31/05
|
(3)
|
$
13.00
|
$
4.00
|
|
Quarter
ended 6/30/05
|
(3)
|
$
5.50
|
$
1.20
|
|
Quarter
ended 9/30/05
|
(3)
|
$
4.00
|
$
0.50
|
Quarter
ended 12/31/05
|
(3)
|
$
1.50
|
$
0.50
|
Quarter
ended 03/31/06
|
(3)
|
$
23.00
|
$
0.50
|
|
Quarter
ended 06/30/06
|
(3)
|
$
1.40
|
$
0.20
|
FY
2006
|
FY
2005
|
||||||||||||
Properties
Sold
|
Revenue
(000s)
|
Properties
Sold
|
Revenue
(000s)
|
||||||||||
Texas
|
1,588
|
$
|
2,059.5
|
701
|
$
|
1,174.5
|
|||||||
Oklahoma
|
464
|
646.1
|
67
|
89.8
|
|||||||||
Pennsylvania
|
504
|
1,211.3
|
-
|
-
|
|||||||||
New
Mexico
|
53
|
217.0
|
-
|
-
|
|||||||||
Florida
|
23
|
183.2
|
-
|
-
|
|||||||||
Colorado
|
12
|
239.2
|
-
|
-
|
|||||||||
2,644
|
$
|
4,556.3
|
768
|
$
|
1,264.3
|
FY
2006
|
FY
2005
|
||||||||||||
Total
$ (000s)
|
As
% of Net Revenue
|
Total
$ (000s)
|
As
% of Net Revenue
|
||||||||||
Cost
of goods sold:
|
|||||||||||||
Land
costs
|
$
|
2,099.6
|
46.1
|
%
|
$
|
640.5
|
50.7
|
%
|
|||||
Royalties
to affiliate
|
668.1
|
14.7
|
%
|
177.9
|
14.1
|
%
|
|||||||
Merchant
fees
|
112.3
|
2.5
|
%
|
24.9
|
2.0
|
%
|
|||||||
Processing
fees
|
210.2
|
4.6
|
%
|
40.3
|
3.2
|
%
|
|||||||
Commissions
|
189.4
|
4.2
|
%
|
41.6
|
3.3
|
%
|
|||||||
Dues
and Taxes
|
35.8
|
0.6
|
%
|
8.7
|
0.6
|
%
|
|||||||
$
|
3,315.4
|
72.7
|
%
|
$
|
933.9
|
73.9
|
%
|
FY
2006
|
FY
2005
|
||||||
(000s)
|
(000s)
|
||||||
Salaries
and related taxes
|
$
|
617.9
|
$
|
36.4
|
|||
Legal
fees
|
220.7
|
24.0
|
|||||
Investor
relations expenses
|
159.7
|
-
|
|||||
Professional
fees - related party
|
126.8
|
-
|
|||||
Professional
fees
|
81.4
|
95.4
|
|||||
Accounting/audit
expenses
|
44.7
|
-
|
|||||
Travel
|
127.0
|
46.0
|
|||||
Office
rent - related party
|
22.2
|
12.6
|
|||||
Stock
issued to consultants
|
374.7
|
-
|
|||||
Inventory
impairment
|
68.0
|
-
|
|||||
Other
|
35.5
|
(32.0
|
)
|
||||
$
|
1,878.6
|
$
|
182.4
|
FY
2006 net loss
|
$
|
1,199,070
|
||
Less
stock issued for services (non-cash)
|
(374,667
|
)
|
||
Less
fees to Piping Partners Holdings, LLC
|
(235,000
|
)
|
||
Less
merger-related fees
|
(140,000
|
)
|
||
Adjusted
FY 2006 net loss
|
$
|
449,403
|
Actively
Marketed
|
Being
Prepared for Marketing
|
Total
|
|||||||
Arizona
|
$
|
29,614
|
$
|
-
|
$
|
29,614
|
|||
Colorado
|
314,128
|
-
|
314,128
|
||||||
Florida
|
19,600
|
-
|
19,600
|
||||||
Mexico
|
-
|
298,348
|
298,348
|
||||||
Michigan
|
15,919
|
-
|
15,919
|
||||||
Nevada
|
-
|
855,476
|
855,476
|
||||||
New
Mexico
|
60,285
|
-
|
60,285
|
||||||
Oklahoma
|
21,917
|
-
|
21,917
|
||||||
Pennsylvania
|
359,512
|
32,748
|
392,260
|
||||||
Texas
|
1,226,566
|
3,150
|
1,229,716
|
||||||
Total
|
$
|
2,047,541
|
$
|
1,189,722
|
$
|
3,237,263
|
As
of 12/31/06
|
As
of 12/31/05
|
|||||
Rent
|
$
|
4,663
|
$
|
-
|
||
Insurance
|
13,417
|
-
|
||||
Merchant
fees
|
18,730
|
26,304
|
||||
Sales
commissions
|
31,530
|
43,841
|
||||
Royalties
to an affiliate
|
107,227
|
202,882
|
||||
Processing
fees
|
38,608
|
51,600
|
||||
$
|
214,175
|
$
|
324,627
|
As
of 12/31/06
|
As
of 12/31/05
|
|||||
Accounts
payable
|
$
|
163,175
|
$
|
32,187
|
||
Accrued
expenses
|
330,448
|
22,905
|
||||
Due
to related parties
|
2,640,875
|
1,493,288
|
||||
Reserve
for returns
|
-
|
26,148
|
||||
Current
portion - bank loan
|
39,195
|
59,739
|
||||
Deferred
revenue
|
794,667
|
1,333,367
|
||||
$
|
3,968,360
|
$
|
2,967,634
|
LandBank
Group, Inc. and Subsidiary
|
||||
Consolidated
Balance Sheet
|
||||
As
of December 31, 2006
|
||||
ASSETS
|
||||
Current
assets
|
||||
Cash
& cash equivalents
|
$
|
265,970
|
||
Inventory
- land parcels
|
3,237,263
|
|||
Other
receivable
|
8,542
|
|||
Prepaid
expenses
|
214,175
|
|||
Total
assets
|
$
|
3,725,950
|
||
LIABILITIES
AND SHAREHOLDERS' DEFICIT
|
||||
Current
liabilities
|
||||
Accounts
payable
|
$
|
163,175
|
||
Accrued
expenses
|
330,448
|
|||
Due
to related parties
|
2,640,875
|
|||
Loan
payable - current portion
|
39,195
|
|||
Deferred
income
|
794,667
|
|||
Total
current liabilities
|
3,968,360
|
|||
Loan
payable - non-current portion
|
473,686
|
|||
Shareholders'
deficit
|
||||
Common
stock, 100,000,000 shares authorized; $0.0001
|
||||
par
value; 9,835,331 issued and outstanding
|
984
|
|||
Additional
paid in capital
|
399,617
|
|||
Accumulated
deficit
|
(1,116,697
|
)
|
||
Total
shareholders' deficit
|
(716,096
|
)
|
||
Total
liabilities and shareholders' deficit
|
$
|
3,725,950
|
Landbank
Group Inc. and Subsidiary
|
|||||||
Consolidated
Statements of Operations
|
|||||||
For
The Years Ended December 31, 2006 and 2005
|
|||||||
2006
|
2005
|
||||||
Revenue,
net
|
$
|
4,556,266
|
$
|
1,264,313
|
|||
Cost
of revenue
|
|||||||
Direct
selling expenses
|
2,647,241
|
756,071
|
|||||
Royalty
to related party
|
668,159
|
177,897
|
|||||
Total
cost of sales
|
3,315,400
|
933,968
|
|||||
Gross
profit
|
1,240,866
|
330,345
|
|||||
Operating
expenses
|
|||||||
Rent,
related party
|
22,226
|
12,570
|
|||||
Professional
fees, related parties
|
126,805
|
10,650
|
|||||
Professional
fees
|
433,167
|
-
|
|||||
Inventory
impairment
|
68,000
|
-
|
|||||
Legal
fees
|
220,693
|
24,006
|
|||||
Directors
and officers compensation
|
83,049
|
-
|
|||||
General
& administrative expenses
|
924,683
|
135,194
|
|||||
Total
operating expenses
|
1,878,623
|
182,420
|
|||||
Income
(loss) from operations
|
(637,757
|
)
|
147,925
|
||||
Other
expenses
|
|||||||
Merger-related
costs
|
(140,000
|
)
|
-
|
||||
Professional
fees
|
(235,000
|
)
|
|||||
Interest
expense - bank
|
(54,135
|
)
|
(19,118
|
)
|
|||
Interest
expense - related parties
|
(129,986
|
)
|
(40,434
|
)
|
|||
Total
other expenses
|
(559,121
|
)
|
(59,552
|
)
|
|||
Income
(loss) before income taxes
|
(1,196,878
|
)
|
88,373
|
||||
Provision
for income taxes
|
2,192
|
6,000
|
|||||
Net
income (loss)
|
$
|
(1,199,070
|
)
|
$
|
82,373
|
||
Basic
and diluted weighted average number
|
|||||||
of
common stock outstanding
|
9,627,872
|
8,200,000
|
|||||
Basic
and diluted net income (loss) per share
|
$
|
(0.12
|
)
|
$
|
0.01
|
LandBank
Group, Inc. and Subsidiary
|
||||||||||||||||
Consolidated
Statements of Shareholders' Equity (Deficit)
|
||||||||||||||||
As
of December 31, 2006
|
||||||||||||||||
Additional
|
Retained
|
|||||||||||||||
Common
Stock
|
Paid
in
|
Earnings
|
Shareholders'
|
|||||||||||||
Shares
|
Amount
|
Capital
|
(Deficit)
|
Equity
(Deficit)
|
||||||||||||
Balance
as of January 1, 2005
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
|||||||
Shares
issued per merger
|
8,200,000
|
820
|
(820
|
)
|
-
|
-
|
||||||||||
Net
income for the year ended December 31, 2005
|
-
|
-
|
-
|
82,373
|
82,373
|
|||||||||||
Balance
as of December 31, 2005
|
8,200,000
|
820
|
(820
|
)
|
82,373
|
82,373
|
||||||||||
Recapitalization
|
1,005,200
|
101
|
(101
|
)
|
-
|
-
|
||||||||||
Shares
issued to consultants
|
624,445
|
62
|
374,605
|
-
|
374,667
|
|||||||||||
Shares
issued for rounding up for split
|
5,686
|
1
|
(1
|
)
|
-
|
-
|
||||||||||
Amortization
of options granted to Directors
|
-
|
-
|
25,934
|
-
|
25,934
|
|||||||||||
Net
loss for the year ended December 31, 2006
|
-
|
-
|
-
|
(1,199,070
|
)
|
(1,199,070
|
)
|
|||||||||
Balance
as of December 31, 2006
|
9,835,331
|
$
|
984
|
$
|
399,617
|
$
|
(1,116,697
|
)
|
$
|
(716,096
|
)
|
LandBank
Group, Inc. and Subsidiary
|
|||||||
Consolidated
Statements of Cash Flows
|
|||||||
For
the Years Ended December 31, 2006 and 2005
|
|||||||
|
|
||||||
2006
|
2005
|
||||||
Cash
flows from operating activities:
|
|
|
|||||
Net
income (loss)
|
$
|
(1,199,070
|
)
|
$
|
82,373
|
||
Adjustments
to reconcile net income (loss) to net cash
|
|||||||
used
in operating activities:
|
|||||||
Shares
issued for service
|
374,667
|
-
|
|||||
Amortization
of options granted to Directors
|
25,934
|
-
|
|||||
Inventory
Impairment
|
68,000
|
-
|
|||||
Changes
in current assets and liabilities:
|
|||||||
(Increase)
decrease in current assets
|
|||||||
Inventory
- land parcels
|
(868,787
|
)
|
(2,436,478
|
)
|
|||
Other
receivable
|
(8,542
|
)
|
-
|
||||
Prepaid
expenses
|
110,452
|
(324,627
|
)
|
||||
Increase
(decrease) in current liabilities
|
|||||||
Accounts
payable
|
130,990
|
32,187
|
|||||
Accrued
expenses
|
307,543
|
22,905
|
|||||
Reserve
for returns
|
(26,148
|
)
|
26,148
|
||||
Deferred
income
|
(538,700
|
)
|
1,333,367
|
||||
Total
adjustments
|
(424,591
|
)
|
(1,346,498
|
)
|
|||
Net
cash used in operating activities
|
(1,623,661
|
)
|
(1,264,125
|
)
|
|||
Cash
flows from financial activities
|
|||||||
Due
to related parties
|
1,318,034
|
1,322,841
|
|||||
Repayment
of loans
|
(59,828
|
)
|
572,709
|
||||
Net
cash provided by financial activities
|
1,258,206
|
1,895,550
|
|||||
Net
change in cash and cash equivalents
|
(365,455
|
)
|
631,425
|
||||
Cash
and cash equivalents - beginning balance
|
631,425
|
-
|
|||||
Cash
and cash equivalents - ending balance
|
$
|
265,970
|
$
|
631,425
|
|||
Supplemental
disclosure of cash flows information:
|
|||||||
Taxes
paid
|
$
|
8,192
|
$
|
-
|
|||
Interest
paid
|
$
|
54,135
|
$
|
19,118
|
1. |
Requires
an entity to recognize a servicing asset or servicing liability each
time
it undertakes an obligation to service a financial asset by entering
into
a servicing contract.
|
2. |
Requires
all separately recognized servicing assets and servicing liabilities
to be
initially measured at fair value, if practicable.
|
3. |
Permits
an entity to choose ‘Amortization method’ or ‘Fair value measurement
method’ for each class of separately recognized servicing assets and
servicing liabilities.
|
4. |
At
its initial adoption, permits a one-time reclassification of
available-for-sale securities to trading securities by entities with
recognized servicing rights, without calling into question the treatment
of other available-for-sale securities under Statement 115, provided
that
the available-for-sale securities are identified in some manner as
offsetting the entity’s exposure to changes in fair value of servicing
assets or servicing liabilities that a servicer elects to subsequently
measure at fair value.
|
5. |
Requires
separate presentation of servicing assets and servicing liabilities
subsequently measured at fair value in the statement of financial
position
and additional disclosures for all separately recognized servicing
assets
and servicing liabilities.
|
1. |
A
brief description of the provisions of this Statement
|
2. |
The
date that adoption is required
|
3. |
The
date the employer plans to adopt the recognition provisions of this
Statement, if earlier.
|
As
of December 31, 2006
|
As
of December 31, 2005
|
||||||||||||||||||
Principal
|
Interest
|
Total
|
Principal
|
Interest
|
Total
|
||||||||||||||
John
Beck's Amazing Profits, LLC
|
$
|
448,377
|
$
|
(5,179
|
)
|
$
|
443,198
|
$
|
330,015
|
$
|
-
|
$
|
330,015
|
||||||
Mentoring
of America, LLC
|
60,788
|
6,311
|
67,099
|
176,381
|
1,821
|
178,202
|
|||||||||||||
HG,
Inc.
|
1,542,675
|
99,218
|
1,641,893
|
467,405
|
9,324
|
476,729
|
|||||||||||||
HG
Marketing, LLC
|
382,606
|
67,677
|
450,283
|
482,606
|
25,736
|
508,342
|
|||||||||||||
Family
Products, LLC
|
-
|
2,393
|
2,393
|
(174,000
|
)
|
3,553
|
(170,447
|
)
|
|||||||||||
Gaytan,
Baumblatt, Leevan
|
36,009
|
-
|
36,009
|
-
|
-
|
-
|
|||||||||||||
$
|
2,470,455
|
$
|
170,420
|
$
|
2,640,875
|
$
|
1,282,407
|
$
|
40,434
|
$
|
1,322,841
|
Years
ended
|
|||
December
31,
|
|||
2007
|
$
|
39,195
|
|
2008
|
43,299
|
||
2009
|
47,833
|
||
2010
|
52,842
|
||
2011
|
58,375
|
||
Thereafter
|
271,337
|
||
Total
|
512,881
|
||
Current
portion
|
39,195
|
||
Long-term
portion
|
$
|
473,686
|
During
the year ended December 31, 2006, the Company recorded an inventory
impairment charge of $68,000 in relation to the write-down of the
carrying, or recorded, cost of properties owned by the Company
in
Montgomery County, Texas. As stated above in note 1, the Company
performs
quarterly reviews of its inventory holdings to identify any potential
inventory impairment. As a result of the Company’s review for the quarter
ending December 31, 2006, several groups of properties within its
Montgomery County, Texas holdings were identified as impaired due
to
zoning issues, title issues, the poor quality of the property,
or a
combination of the three. As a result, the Company’s estimate of the fair
market value (“FMV”) of these properties was significantly lower than
their recorded cost, so an impairment charge of $68,000 was recorded
to
bring the carrying cost of these properties in line with their
current
estimated FMV.
|
As
of 12/31/06
|
||||
Rent
|
$
|
4,663
|
||
Insurance
|
13,417
|
|||
Merchant
fees
|
18,730
|
|||
Sales
commissions
|
31,530
|
|||
Royalties
to an affiliate
|
107,227
|
|||
Processing
fees
|
38,608
|
|||
$
|
214,175
|
Post-Split
|
Pre-Split
|
||||||
Par Value | $ | 0.0001 | $ | 0.00001 | |||
Authorized number of shares | 100,000,000 | 1,000,000,000 | |||||
Shares issued and outstanding | 9,206,597 | 92,052,000 |
2007
|
2008
|
2009
|
||||||||
Arizona
Office
|
$
|
22,224
|
$
|
1,852
|
$
|
-
|
||||
Alameda
Office
|
25,245
|
28,392
|
2,366
|
|||||||
Total
|
$
|
47,469
|
$
|
30,244
|
$
|
2,366
|
Options
outstanding
|
Weighted
Average Exercise Price
|
Aggregate
Intrinsic Value
|
||||||||
Outstanding,
December 31, 2005
|
-
|
-
|
-
|
|||||||
Granted
|
1,400,000
|
$
|
0.02
|
-
|
||||||
Forfeited
|
-
|
-
|
-
|
|||||||
Exercised
|
-
|
-
|
||||||||
Outstanding
December 31, 2006
|
1,400,000
|
$
|
0.02
|
-
|
Outstanding
Options
|
Exercisable
Options
|
|||||
|
|
|||||
Exercise
Price
|
Number
|
Average
Remaining Contractual Life
|
Average
Exercise Price
|
Number
|
Average
Exercise Price
|
|
$0.0001
|
1,200,000
|
4.86
|
$0.0001
|
34,849
|
$0.0001
|
|
$0.12
|
200,000
|
4.99
|
$0.02
|
438
|
$0.02
|
|
1. |
Hired
additional Land Acquisition Specialists to help acquire more properties,
as well as a more diversified mix of properties, that may allow the
Company to increase sales volume while minimizing the risk of saturating
a
particular market, or geographic location, and thereby adversely
affecting
the ability of the Company’s customers to resell their properties at a
profit.
|
2. |
Hired
consultants to assist the Company in securing additional financing
(see
note 13).
|
Name
|
Age
|
Position
Held and Tenure
|
||
Doug
Gravink
|
51
|
Director
and Chief Executive Officer
|
||
since
January 2006
|
||||
Gary
Hewitt
|
50
|
Director
and President and Secretary
|
||
since
January 2006
|
||||
John
Genesi
|
42
|
Chief
Financial Officer
|
||
since
July 2006
|
||||
John
Beck
|
64
|
Director
since January 2006
|
||
Ray
Gaytan
|
53
|
Director
since January 2006
|
||
|
||||
Stephen
Weber
|
58
|
Director
since January 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All
Other
|
|
|
||
Name
and Principal
|
|
|
Year
|
|
|
Salary
|
|
|
Bonus
|
|
|
Option
Awards
|
|
|
Compensation
|
|
|
Total
|
Position
|
|
|
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|
($)
|
|||||
(a)
|
(b)
|
|
(c)
|
|
(d)
|
|
(f)
|
|
(i)
|
|
(j)
|
|||||||
Douglas
Gravink (1)
|
2006
|
--
|
--
|
$
|
974(3
|
)
|
$
|
334,080(4
|
)
|
$
|
335,054
|
|||||||
Chief
Executive Officer
|
||||||||||||||||||
Gary
Hewitt (1)
|
2006
|
--
|
--
|
$
|
974(3
|
)
|
$
|
334,079(4
|
)
|
$
|
335,053
|
|||||||
President
and Secretary
|
||||||||||||||||||
John Genesi (2) | ||||||||||||||||||
Chief
Financial Officer
|
2006
|
$
|
57,115
|
--
|
--
|
--
|
$
|
57,115
|
·
|
Dividend
yield per share
|
$
0.00
|
|
|
|
·
|
Annualized
volatility
|
191.06%
|
|
|
|
·
|
Risk-free
interest rate
|
4.69%
|
|
|
|
·
|
Expected
life
|
5
years
|
|
|
|
·
|
Probability
of achieving market condition
|
Above
Average
|
|
|
|
·
|
Discount
Factor Applied to market condition
|
None
|
Option
Awards
|
||||||||||||||||
|
Number
of
|
Number
of
|
Equity
Incentive Plan
|
Option
|
Option
|
|||||||||||
|
Securities
Underlying
|
Securities
Underlying
|
Awards:
Number of
|
Exercise
|
Expiration
|
|||||||||||
Name
|
Unexercised
Options (#)
|
Unexercised
Options (#)
|
Securities
Underlying
|
Price
($)
|
Date
|
|||||||||||
|
Exercisable
|
Unexercisable
|
Unexercised
Unearned
|
|
|
|||||||||||
|
|
|
Options
(#)
|
|||||||||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
|||||||||||
Douglas
Gravink
|
--
|
--
|
100,000
(1
|
)
|
$
|
0.12
|
12/27/16
|
|||||||||
Gary
Hewitt
|
--
|
--
|
100,000
(1
|
)
|
$
|
0.12
|
12/27/16
|
|||||||||
John
Genesi
|
--
|
--
|
--
|
--
|
--
|
(1) |
On
December 28, 2006, both Messrs. Gravink and Hewitt were granted
an option
to purchase 100,000 shares of common stock at an exercise price
of $0.12
per share, the fair market value of our common stock on the date
of grant,
in consideration of their service as a director of the company.
Each of
the options vests as follows: 50% of the shares subject to each
option
will vest upon achievement of a specified performance goal related
to our
stock price and the remainder will vest on a quarterly basis thereafter
at
a rate of 25% per quarter. The options will not vest and the options
will
expire prior to the specified date in the table in the event that
the
performance goal is not achieved within the timeframe specified
by the
goal.
|
(2) |
The
options will expire earlier in the event the performance goal is
not met
within one year of the later of the (i) the date of grant or (ii)
the
listing of the Company's stock on the
OTCBB.
|
Name
(1)
|
Fees
Earned
|
Stock
|
Option
|
Non-Equity
|
Change
in Pension
|
All
Other
|
Total
($)
|
|||||||||||||||
|
or
Paid in
|
Awards
($)
|
Awards
($)
|
Incentive
Plan
|
Value
and
|
Compensation
($)
|
|
|||||||||||||||
|
Cash
($)
|
|
|
Compensation
($)
|
Nonqualified
|
|
|
|||||||||||||||
|
|
|
|
|
Deferred
|
|
|
|||||||||||||||
|
|
|
|
|
Compensation
|
|
|
|||||||||||||||
|
|
|
|
|
Earnings
($)
|
|
||||||||||||||||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
|||||||||||||||
Ray
Gaytan (2)
|
--
|
--
|
$
|
11,993
(3
|
)
|
--
|
--
|
$
|
126,805(4
|
)
|
$
|
138,798
|
||||||||||
Stephen
Weber (2)
|
--
|
--
|
$
|
11,993
(3
|
)
|
--
|
--
|
$
|
120,000(5
|
)
|
$
|
131,993
|
||||||||||
John
Beck
|
--
|
--
|
--
|
--
|
--
|
--
|
--(6
|
)
|
(1) |
This
table excludes information relating to Messrs. Gravink and Hewitt
as all
compensation earned in consideration of their services on the board
of
directors has been reported in the Summary Compensation Table above.
All
options granted to Messrs. Gravink and Hewitt were outstanding as
of
December 31, 2006.
|
(2) |
As
of December 31, 2006, each of Messrs. Gaytan and Weber held options
to
purchase an aggregate of 600,000 shares of our common stock, all
of which
remain outstanding.
|
(3) |
Both
Messrs. Gaytan and Weber were granted an option to purchase 600,000
shares
of common stock at an exercise price of $0.0001 per share on November
9,
2006 in consideration of their service as a director of the company.
Each
of the options vests according to the following schedule: 20% of
the
shares subject to each option vested on December 31, 2006 and 20%
of the
shares subject to each option vest each year thereafter. The fair
market
value of our common stock on the date of grant was $0.10 per share.
These
options were valued at $59,963 each on the date of grant using the
Black-Sholes option pricing model in accordance with FAS 123R. We
expensed
$11,993 of this value for each option grant during 2006, representing
20%
of the total value of the option grant, with the remaining value
of the
option grant to be expensed over the remaining vesting period. Assumptions
made in the valuation of stock options granted to Messrs. Gaytan
and Weber
are as follows:
|
·
|
Dividend
yield per share
|
$
0.00
|
|
|
|
·
|
Annualized
volatility
|
125.95%
|
|
|
|
·
|
Risk-free
interste rate
|
4.60%
|
|
|
|
·
|
Expected
life
|
5
years
|
|
|
|
(4)
|
Represents
fees totaling $126,805 paid to Gaytan, Baumblatt & Leevan, LLP in 2006
in relation to accounting services provided by this accounting firm.
Mr.
Gaytan is a partner in this firm.
|
(5)
|
Represents
consulting fees paid to Investment Capital Researchers, Inc. ("ICR"),
a
company owned by Mr. Weber for consulting services rendered to Landbank,
LLC. Payment of these fees was made by issuing 200,000 shares of
the
Company's common stock, valued at
$120,000.
|
(6)
|
Excludes
profit participation received by Mr. Beck for services provided to
our
affiliate, John Beck Amazing Profits, LLC equal to 50% of any royalty
payments received by John Beck Amazing Profits, LLC from us. Also
excludes
salaries earned by Mr. Beck's three children who are employed as
acquisition specialists by the
Company.
|
(1)
Title
of Class
|
(2)
Name
and Address of Beneficial Owner
|
(3)
Amount
and Nature of Beneficial Ownership (1)
|
(4)
Percent
of Class (2)
|
|||
1.
Common
|
Doug
Gravink
7030
Hayvenhurst Ave.
Van
Nuys, CA 91406
|
2,733,334
|
27.8%
|
|||
2.
Common
|
Gary
Hewitt
7030
Hayvenhurst Ave.
Van
Nuys, CA 91406
|
2,733,333
|
27.8%
|
|||
3.
Common
|
John
Beck (3)
7030
Hayvenhurst Ave.
Van
Nuys, CA 91406
|
2,733,333
|
27.8%
|
|||
4.
Common
|
John
Genesi
7030
Hayvenhurst Ave.
Van
Nuys, CA 91406
|
-0-
|
-0-
|
|||
5.
Common
|
Ray
Gaytan (4)
11400
Olympic Blvd.
Los
Angeles, CA 90064
|
124,680
|
1.3%
|
|||
6.
Common
|
Stephen
Weber (5)
5808
Varna Ave.
Van
Nuys, CA 91401
|
320,000
|
3.2
%
|
|||
7.
Common
|
Directors
and Executive Officers as a
Group
(6 persons)
|
8,644,680
|
87.8%
|
(1)
|
"Beneficial
Owner" means having or sharing, directly or indirectly (i) voting
power,
which includes the power to vote or to direct the voting, or
(ii)
investment power, which includes the power to dispose or to direct
the
disposition, of shares of the common stock of an issuer. The
definition of
beneficial ownership includes shares, underlying options or warrants
to
purchase common stock, or other securities convertible into common
stock,
that currently are exercisable or convertible or that will become
exercisable or convertible within 60 days. Unless otherwise indicated,
the
beneficial owner has sole voting and investment power.
|
(2)
|
Percentages
are based on 9,835,331 shares of common stock issued and outstanding
as of
December 31, 2006.
|
(3)
|
Held
as JTWRS with his wife.
|
(4)
|
Includes
120,000 shares subject to options exercisable within 60 days of December
31, 2006.
|
(5)
|
Includes
200,000 shares issued to Investment Capital Researchers, Inc.
(“ICR”)
pursuant to an agreement dated August 1, 2005, and amended June 27,
2006
for the provision of advisory services to the Company.
Stephen Weber is the sole stockholder and director of ICR.
Includes 120,000 shares subject to options exercisable within 60
days of
December 31, 2006.
|
Principal
|
Interest
|
Total
|
|||||||
John
Beck's Amazing Profits, LLC
|
$
|
448,377
|
$
|
(5,179
|
)
|
$
|
443,198
|
||
Mentoring
of America, LLC
|
60,788
|
6,311
|
67,099
|
||||||
HG,
Inc.
|
1,542,675
|
99,218
|
1,641,893
|
||||||
HG
Marketing, LLC
|
382,606
|
67,677
|
450,283
|
||||||
Family
Products, LLC
|
-
|
2,393
|
2,393
|
||||||
$
|
2,434,446
|
$
|
170,420
|
$
|
2,604,866
|
Thomas
Makmann
|
50
|
%
|
||
Gregory
Pelletier
|
13
|
%
|
||
James
R. Kirkland
|
13
|
%
|
||
Douglas
Donsbach
|
13
|
%
|
||
Total
|
89
|
%
|
Gary
Hewitt
|
|
|
2,733,334
|
|
|
27.8
|
%
|
John
Beck
|
|
|
2,733,333
|
|
|
27.8
|
%
|
Doug
Gravink
|
|
|
2,733,333
|
|
|
27.8
|
%
|
|
|
|
8,200,000
|
|
|
83.4
|
%
|
EXHIBIT
NUMBER
|
DESCRIPTION
|
|
|
|
|
2.1*
|
Stock
Purchase Agreement dated January 23, 2006 between iStorage Networks,
Inc.
and Landbank, LLC.
|
|
2.2*
|
Stock
Purchase Agreement dated January 23, 2006 between M. Thomas Makmann
and
iStorage Networks, Inc.
|
|
3.1*
|
Certificate
of Incorporation of the Company, formerly Camryn Information Services,
Inc., dated May 13, 1997.
|
|
3.2*
|
Certificate
of Renewal and Revival of Charter dated October 29,
2004.
|
|
3.3*
|
Certificate
of Amendment to the Certificate of Incorporation to change name
to
iStorage Networks, Inc., dated November 8, 2004.
|
|
3.4*
|
Certificate
of Amendment to the Certificate of Incorporation to change name
to
Landbank Group, Inc., dated January 27, 2006.
|
|
3.5*
|
Certificate
of Amendment to the Certificate of Incorporation, dated June 29,
2006,
reflecting the reverse split of the Company’s common
stock.
|
|
3.6*
|
Amended
and Restated By-Laws of the Company adopted November 2,
2006.
|
|
10.1*
|
Agreement
with ICR dated August 1, 2005 as amended June 27, 2006.
|
|
10.2*
|
2006
Stock Incentive Plan
|
|
10.3*
|
Form
of Stock Option Agreement under 2006 Stock Incentive
Plan.
|
|
11
|
Statement
re computation of per share earnings (see Statement of Operations
and
Notes to Financial Statements).
|
|
21*
|
Subsidiaries
of the Company.
|
|
23
|
Consent
of Kabani & Company, Inc., independent auditors.
|
|
31.1
|
Certifications
of President and CEO required by Rule 13a-14(a) or Rule 15d-14(a)
of the
Securities Exchange Act.
|
|
31.2
|
Certification
of CFO required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities
Exchange Act.
|
|
32.1
|
Section
1350 certifications by President and Chief Executive
Officer.
|
|
32.2
|
Section
1350 certification by Chief Financial
Officer.
|
*
|
Incorporated
by reference to Amendment No. 2 to the Registrant's Registration
Statement
on Form 10-SB, filed with the Securities and Exchange Commission
on
January 4, 2007.
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LANDBANK GROUP, INC. | ||
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Date: March 30, 2007 | By: | /s/ Douglas Gravink |
Douglas Gravink | ||
CEO |
SIGNATURE
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TITLE
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DATE
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/s/Doug
Gravink
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Chief
Executive Officer and Director
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March
30, 2007
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Doug
Gravink
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(Principal
Executive Officer)
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/s/Gary
Hewitt
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President,
Secretary and Director
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March
30, 2007
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Gary
Hewitt
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(Principal
Executive Officer)
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/s/John
Genesi
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Chief
Financial Officer
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March
30, 2007
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John
Genesi
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(Principal
Financial Officer)
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/s/John
Beck
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Director
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March
30, 2007
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John
Beck
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||
/s/Ray
Gaytan
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Director
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March
30, 2007
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Ray
Gaytan
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||
/s/Stephen
Weber
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Director
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March
29, 2007
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Stephen
Weber
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EXHIBIT
NUMBER
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DESCRIPTION
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2.1*
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Stock
Purchase Agreement dated January 23, 2006 between iStorage Networks,
Inc.
and Landbank, LLC.
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2.2*
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Stock
Purchase Agreement dated January 23, 2006 between M. Thomas Makmann
and
iStorage Networks, Inc.
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3.1*
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Certificate
of Incorporation of the Company, formerly Camryn Information
Services,
Inc., dated May 13, 1997.
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3.2*
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Certificate
of Renewal and Revival of Charter dated October 29,
2004.
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3.3*
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Certificate
of Amendment to the Certificate of Incorporation to change name
to
iStorage Networks, Inc., dated November 8, 2004.
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3.4*
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Certificate
of Amendment to the Certificate of Incorporation to change name
to
Landbank Group, Inc., dated January 27, 2006.
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3.5*
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Certificate
of Amendment to the Certificate of Incorporation, dated June
29, 2006,
reflecting the reverse split of the Company’s common
stock.
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3.6*
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Amended
and Restated By-Laws of the Company adopted November 2,
2006.
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10.1*
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Agreement
with ICR dated August 1, 2005 as amended June 27, 2006.
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10.2*
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2006
Stock Incentive Plan
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10.3*
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Form
of Stock Option Agreement under 2006 Stock Incentive
Plan.
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11
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Statement
re computation of per share earnings (see Statement of Operations
and
Notes to Financial Statements).
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21*
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Subsidiaries
of the Company.
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23
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Consent
of Kabani & Company, Inc., independent auditors.
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31.1
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Certifications
of President and CEO required by Rule 13a-14(a) or Rule 15d-14(a)
of the
Securities Exchange Act.
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31.2
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Certification
of CFO required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities
Exchange Act.
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32.1
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Section
1350 certifications by President and Chief Executive
Officer.
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32.2
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Section
1350 certification by Chief Financial
Officer.
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*
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Incorporated
by reference to Amendment No. 2 to the Registrant's Registration
Statement
on Form 10-SB, filed with the Securities and Exchange Commission
on
January 4, 2007.
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