ITEM 1 - BUSINESS
Unless the context otherwise requires, “Fresca”, “Company”, “we”, “us” and “our” refer to Fresca Worldwide Trading Corporation and its subsidiaries combined.
The Company was formed under the laws of the State of Nevada on December 29, 2003. On February 10, 2006, the Company entered into an asset purchase agreement with Cobalt Blue, LLC, a New York limited liability company, for the purchase of its ATM assets for a purchase price of $10,000. Cobalt Blue, LLC is a privately held company and has been in existence since 2003. Prior to acquisition of Cobalt’s ATM’s, the Company had no operations or assets.
Fresca Worldwide Trading, Corp., a Nevada corporation, or Fresca or the Company, was a provider of both privately-owned and company-owned Automatic Teller Machines , or ATM’s, in Onondaga County in upstate New York until February 2010. The Company received revenues from the collection of the surcharge revenues and inter-exchange revenues.
Effective as of September 30, 2009 the Company categorized it’s ATM assets as “Held-for-Sale” in preparation for the Reverse Merger with Go Solar USA, Inc. On February 18, 2010 the Company filed a “Super” 8-K with the Securities and Exchange Commission detailing the Reverse Merger transaction in greater detail. All disclosure herein refer solely to the legacy operations of the Company prior to the Reverse Merger, and are therefore not indicative of the operations, nor results of such operations, of the Company on a continuing basis.
ITEM 1A
ITEM 1A - RISK FACTORS
You should consider the following discussion of risks as well as other information regarding our common stock. The risks and uncertainties described below are not the only ones. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business operations. If any of the following risks actually occur, our business could be harmed.
Additional Financing
Additional financing is required to continue operations. Although actively searching for available capital, the Company does not have any current arrangements for additional outside sources of financing and cannot provide any assurance that such financing will be available.
Limited Trading Market
Currently, only a very limited trading market exists for Fresca common stock. The common stock trades on the OTC under the symbol "FRSC." The OTC is a limited market and subject to substantial restrictions and limitations in comparison to the NASDAQ system. Any broker/dealer that makes a market in the Company stock or other person that buys or sells the stock could have a significant influence over its price at any given time. The Company cannot assure its shareholders that a market for its stock will be sustained. There is no assurance that its shares will have any greater liquidity than shares that do not trade on a public market.
Going Concern
We have accrued net losses of $19,675 for the period ended December 31, 2009. Our future is dependent upon our ability to obtain financing and upon future profitable operations from the development of our business. These factors raise substantial doubt that we will be able to continue as a going concern. Our independent auditor, has expressed substantial doubt about our ability to continue as a going concern. This opinion could materially limit our ability to raise additional funds by issuing new debt or equity securities or otherwise. If we fail to raise sufficient capital when needed, we will not be able to complete our business plan. As a result we may have to liquidate our business and you may lose your investment. You should consider our auditor's comments when determining if an investment in our company is suitable.
Dividends
We do not intend to declare dividends for the foreseeable future, as we anticipate that we will reinvest any future earnings in the development and growth of our business. Therefore, investors will not receive any funds unless they sell their common stock, and stockholders may be unable to sell their shares on favorable terms or at all. Investors cannot be assured of a positive return on investment or that they will not lose the entire amount of their investment in the common stock.
"Penny Stocks"
Our common stock is presently considered to be a "penny stock" and is subject to SEC rules and regulations which impose limitations upon the manner in which such shares may be publicly traded and regulate broker-dealer practices in connection with transactions in "penny stocks." Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market. The broker-dealer must also provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer's account. In addition, the penny stock rules generally require that prior to a transaction in a penny stock, the broker-dealer make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for a stock that becomes subject to the penny stock rules which may increase the difficulty investors may experience in attempting to liquidate such securities.
ITEM 1B
ITEM 1B - UNRESOLVED STAFF COMMENTS
None.
ITEM 2
ITEM 2 - PROPERTIES
During the periods covered in this Annual Report the Company leased office space under an operating lease which expired in July 2009. The lease continued on a month-to-month basis after it expired. Rent expense for the period ended December 31, 2009 amounted to $2,200.
ITEM 3
ITEM 3 - LEGAL PROCEEDINGS
None.
ITEM 4
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters brought to a vote of the security holders.
PART II
ITEM 5
ITEM 5 - MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our common stock began trading on the "Over the Counter" Markets ("OTC") under the symbol “FRSC” In July, 2008. The following table sets forth, for the respective periods indicated, the prices of the common stock in the over-the-counter market, as reported and summarized by the OTC.
Common Stock
Our authorized common stock consists of 100,000,000 shares of $0.001 par value common stock. The closing price of our common stock on December 31, 2009, as quoted by the OTC was $.35.
Record Holders
As of December 31, 2009, there were approximately 447 holders of record of our common stock.
Dividends on Common Stock
Since inception, no dividends have been paid on our common stock. We intend to retain any earnings for use in our business activities, so it is not expected that any dividends on our common stock will be declared and paid in the foreseeable future.
Any future dividends will be at the discretion of the Board of Directors, after taking into account various factors, including among others, operations, current and anticipated cash needs and expansion plans, the income tax laws then in effect, the requirements of Nevada law, and any restrictions that may be imposed by our future credit arrangements.
Preferred Stock
Our authorized preferred stock consists of 10,000,000 shares of $0.001 par value preferred stock. As of the date of this report, there are no shares of preferred stock outstanding. The Company’s preferred stock ranks senior to all other equity securities, including common stock. Dividends, when, as and if declared by the Board of Directors, shall be paid out of funds at the time legally available for such purpose.
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS
The following table shows the number of shares of common stock that could be issued upon exercise of outstanding options and warrants, the weighted average exercise price of the outstanding options and warrants, and the remaining shares available for future issuance as of December 31, 2009.
Item 6
Item 6 - SELECTED FINANCIAL DATA
Not Applicable.
ITEM 7
ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORWARD LOOKING STATEMENTS
Certain statements contained in this Annual Report on Form 10-K, including, without limitation, statements using words such as "believe", "expect", "anticipate", "intend", "estimate", "plan", and words and expressions of similar import, constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements involve risks and uncertainties, and our actual results could differ from those anticipated in such statements as a result of these risks and uncertainties. In addition to the uncertainties stated elsewhere in this report, the factors which could affect these forward-looking statements include, but are not limited to, adverse changes in general economic conditions, including adverse changes in the specific markets for our products, adverse business conditions, increased competition, pricing pressures, lack of success in marketing our products and services, and other factors. These forward-looking statements speak only as of the date of this report and readers are cautioned not to place undue reliance upon such statements.
The following discussion and analysis should be read in connection with the Company’s consolidated financial statements and related notes thereto, as included in this report.
Results of Operation
Fresca incurred a net loss of approximately $20,000 for the twelve months ended December 31 2009, and had a working capital deficit of approximately $44,000 as of December 31, 2009. These conditions create an uncertainty as to Fresca’s ability to continue as a going concern.
Cash used by continuing operations, provided by investing activities and provided by financing activities was approximately $25,000, $1,700 and $14,000, respectively, for the year ended December 31, 2009. Cash provided by discontinued operations was approximately $14,000 for the same period.
Fresca continues to rely on advances to fund operating shortfalls and does not foresee a change in this situation in the immediate future. There can be no assurance that Fresca will continue to have such advances available. Fresca will not be able to continue operations without them. Fresca is pursuing alternate sources of financing.
Results of Operations for the years ended December 31, 2009 and 2008
Total Revenue and Gross Profit. The comparative statements of operations for the years ended December 31, 2009 and 2008, reflect no revenue as all revenue was generated by the Company’s discontinued operations and has therefore been reclassified as “Income from Discontinued Operations” on the attached Financial Statements.
Expenses. Total expenses decreased by approximately 60% when comparing the years ended December 31, 2009 and 2008. The reduction is attributed mainly due to reductions in personnel and sales and marketing expenses, both a result of discounting the Company’s legacy business operations.
Critical Accounting Policies
The financial reports for the period contain one additional critical accounting policy which was also an initial adoption of accounting policy that had a material impact. Below is a brief discussion of events that materially affected our financial statements and the basis in which the transactions were recorded.
Development Stage Enterprise - As a result of the Company’s discontinuation of its ATM business the Company is now considered a development stage enterprise pursuant to FASB Pronouncements, which focuses on development stage companies. Users of the financial statements should be familiar with this statement and its effect on the financial statements.
Liquidity and Capital Resources
Cash used by operating activities was approximately $23,000 for the year ended December 31, 2009.
Going Concern
The Company’s ability to continue as a going concern is an issue raised as a result of the significant operating losses incurred during the years ended December 31, 2009 and 2008 and its negative working capital. The Company continues to experience net operating losses. The ability to continue as a going concern is subject to the Company’s ability to obtain necessary funding from outside sources, including obtaining additional funding from the sale of securities, increasing sales, or obtaining loans and grants from various financial institutions where possible.
Additional Financing
Additional financing is required to continue operations. Although actively searching for available capital, the Company does not have any current arrangements for additional outside sources of financing and cannot provide any assurance that such financing will be available.
ITEM 7A
ITEM 7A - QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
As of December 31, 2009, we were not exposed to market risks due to changes in interest rates or foreign currency rates and, therefore, we do not use derivative financial instruments to address risk management issues in connection with changes in interest rates and foreign currency rates.
ITEM 8
ITEM 8 - FINANCIAL STATEMENTS AND SUPLEMENTARY DATA
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
Fresca Worldwide Trading Corporation
(A Development Stage Company)
We have audited the accompanying balance sheets of Fresca Worldwide Trading Corporation (A Development Stage Company) as of December 31, 2009 and 2008 and the related statements of operations, shareholders' equity (deficit) and cash flows for the twelve month period ended December 31, 2009 and 2008 and the period from July 1, 2009 (re-entry into development stage) through December 31, 2009 and 2008. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Fresca Worldwide Trading Corporation as of December 31, 2009 and 2008, and the results of its operations and cash flows for the periods described above in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 10 to the financial statement, the Company suffered a net loss from operations and has a net capital deficiency, which raises substantial doubt about its ability to continue as a going concern. Management’s plans regarding those matters are also described in Note 10. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
As discussed in Note 12 to the financial statements, the 2008 financial statements have been restated to correct mistatements in the financial statements.
/s/ M&K CPAS, PLLC
www.mkacpas.com
Houston, Texas
April 30,
FRESCA WORLDWIDE TRADING, CORP.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
The accompanying footnotes are an integral part of these financial statements.
FRESCA WORLDWIDE TRADING, CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
For the years ended December 31, 2009 and 2008 and for
the period from July 1, 2009 (re-entry into development stage) through December 31,
The accompanying footnotes are an integral part of these financial statements.
FRESCA WORLDWIDE TRADING, CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
For the years ended December 31, 2009 and 2008 and for
the period from July 1, 2009 (re-entry into development stage) through December 31,
The accompanying footnotes are an integral part of these financial statements.
FRESCA WORLDWIDE TRADING, CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
The accompanying footnotes are an integral part of these financial statements.
FRESCA WORLDWIDE TRADING, CORP.
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED DECEMBER 31, 2009
NOTE 1. NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF BUSINESS
FRESCA WORLDWIDE TRADING, CORP. (the Company) was a provider of both privately owned and company owned automatic teller machines (ATM). The Company receives revenues from the collection of the surcharge revenues and inter exchange revenues. On July 1, 2009, the Company decided to discontinue the operations of its ATM business and reentered the development stage.
Organization and Basis of Presentation
The Company was formed under the laws of the State of Nevada. On February 10, 2006, the Company entered into an asset purchase agreement with Cobalt Blue, LLC., a New York company, for the purchase of its ATM assets. The Company paid Cobalt Blue, LLC. $10,000 for the purchase of its ATM assets on February 10, 2006. Cobalt Blue, LLC. is operated as a privately held company and has been in existence since 2003. The Company was inactive from December 29, 2003 (date of formation) until February 10, 2006.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ACCOUNTING BASIS
These financial statements are prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC").
DEVELOPMENT STAGE
The Company complies with Accounting Codification Standard 915-10 for its characterization of the Company as development stage.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
CONCENTRATIONS OF CREDIT RISK
The Company's ATM’s are located in New York State and usage of those ATM’s may be affected by economic conditions in those areas. The Company has experienced decrease in revenues due to decreased locations and worsened economic conditions.
The Company maintains cash balances with a financial institution insured by the Federal Deposit Insurance Corporation up to $250,000. There are no uninsured balances at December 31, 2009 and 2008.
CASH AND CASH EQUIVALENTS
The Company considers all highly liquid instruments with a maturity of three months or less when purchased to be cash equivalents for purposes of classification in the balance sheets and statement of cash flows. Cash and Cash equivalents consists of cash in bank (checking) accounts, CD, cash in ATM machines and money market.
FIXED ASSETS AND DEPRECIATION
Fixed assets are stated at cost. Depreciation is calculated on a straight-line basis over the useful lives of the related assets, which range from five to seven years. Maintenance and repairs are charged to income as incurred.
REVENUE RECOGNITION
The Company derives its revenue from surcharge revenue and inter exchange revenue. Surcharge fees are added fees which the Company charges the ATM user for dispensing cash. Inter exchange fees are fees charged between banks for transferring money. The Company all of the Surcharge Fees and receives a portion of the Inter exchange fees as income. The Company recognizes the net fees received as revenues.
The Company receives interchange fees for transactions on ATM’s that it owns. The Company also receives the interchange fee for transactions on ATM’s owned by third party vendors included within its network. The Company keeps and reports as revenues all interchange fees.
The Company has 3 different circumstances for recording the surcharge fee as revenue. In the first case, for ATM’s owned and serviced by the Company, the Company receives and reports all of the surcharge fee as revenue. In the second case, where the Company owns but does not service the ATM’s, the Company records the surcharge fee as revenue and records the portion of the fee paid to the owner of the ATM location as commission expense. In the third case, of ATM’s owned and serviced by third party vendors, the Company rebates all of the surcharge fee to the third party and does not report any surcharge fee revenue
DIVIDENDS
The Company has not adopted any policy regarding payment of dividends. No dividends have been paid during the period shown.
INCOME TAXES
The Company accounts for income taxes under the provisions issued by the FASB which requires recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The Company computes tax asset benefits for net operating losses carried forward. The potential benefit of net operating losses has not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.
EARNINGS (LOSS) PER SHARE
The basic earnings (loss) per share are calculated by dividing the Company’s net income available to common shareholders by the weighted average number of common shares outstanding during the year. The diluted earnings (loss) per share are calculated by dividing the Company’s net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted as of the first of the year for any potentially dilutive debt or equity. There are no diluted shares outstanding.
ACCOUNTS RECEIVABLE
The Company considers accounts receivable to be fully collectible; accordingly, no allowance for doubtful accounts is required. If amounts become uncollectible, they will be charged to operations when that determination is made. No such charges were recorded for the periods ended December 31, 2009 and 2008.
FAIR VALUE OF FINANCIAL INSTRUMENTS
Pursuant to ASC No. 820, “Fair Value Measurements and Disclosures”, the Company is required to estimate the fair value of all financial instruments included on its balance sheet as of December 31, 2009. The Company’s financial instruments consist of cash. The Company considers the carrying value of such amounts in the financial statements to approximate their fair value due to the short-term nature of these financial instruments.
NOTE 3. ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS
During the third quarter of 2009, the Company decided to discontinue the operations of its ATM business and implemented a plan to dispose of the assets and liabilities related to this line of business. On February 10, 2010, the Company entered into an Agreement of Merger and Plan of Reorganization (the “Merger Agreement”) with Go Solar USA, Inc., a privately held Wyoming corporation (“GUSA”). Upon closing of the transaction contemplated under the Merger Agreement (the “Merger”), GUSA merged with and into the Company. The Company immediately affected a name change and will hereinafter be known as Go Solar USA, Inc. At that time the net liabilities our ATM business were assumed by the acquirers of that business.
The ATM assets are recorded at the lower of cost or fair market value of $- at December 31, 2009 and 2008. The ATM assets are a disposal group and constitute a component of the entity with distinguishable cash flows. Accordingly, these assets and cash flows and results of operations associated with these assets are classified as discontinued operations in the accompanying Statements of Operations, Balance Sheets, and Statements of Cash Flows for all periods presented.
The following assets and liabilities have been segregated and classified as assets held for sale and liabilities associated with assets held for sale, as appropriate, in the Balance Sheets as of December 31, 2009 and 2008. The amounts presented below do not include cash which will be retained by the Company.
The following summarized financial information relates to the assets held for sale and have been reported as discontinued operations in all periods presented. Because of the Company’s net loss, there is no provision for income taxes.
NOTE 4. COMMON STOCK
During March 2009 the company issued 19,360,000 shares of common stock for services. The Company adjusted common stock and additional paid in capital accordingly. The shares were valued at $19,553,600 based on the market price of the stock.
In July 2009, the Company cancelled 19,360,000 shares of common stock which had originally been issued for services in conjunction with a share purchase agreement. The agreement was cancelled and the issued shares were returned and cancelled.
During the year ended December 31, 2009, an existing shareholder made a capital contribution of $20,000 to the Company.
In 2008, the Company cancelled 25,000 shares of common stock which had not been paid for as agreed by the purchaser of the shares.
NOTE 5. NOTES PAYABLE - Related Party
The Company has a $5,000 note payable with Joseph Passalaqua bearing interest at 10%; payable on demand. The Company has a $500 note payable with Joseph Passalaqua bearing interest at 18%; payable on demand. The Company made a payment of $5,935 on the note during the year ended December 31, 2009. Interest accrued on these notes totals $327 at December 31, 2009.
NOTE 6. INCOME TAXES
Deferred income taxes may arise from temporary differences resulting from income and expense items reported for financial accounting and tax purposes in different periods. Deferred taxes are classified as current or non-current, depending on the classification of assets and liabilities to which they relate. Deferred taxes arising from temporary differences that are not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse. There are no uncertain tax positions.
The Company currently has net operating loss carryforwards aggregating approximately $100,000, which expire through 2029. The deferred tax asset of $28,000 related to the carryforwards has been fully reserved.
The Company has deferred income tax assets, which have been fully reserved, as follows as of December 31, 2009 and 2008:
NOTE 7. FAIR VALUE ACCOUNTING
On January 1, 2008, the Company adopted ASC No. 820-10 (ASC 820-10), Fair Value Measurements. ASC 820-10 relates to financial assets and financial liabilities.
ASC 820-10 defines fair value, establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (GAAP), and expands disclosures about fair value measurements. The provisions of this standard apply to other accounting pronouncements that require or permit fair value measurements and are to be applied prospectively with limited exceptions.
ASC 820-10 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This standard is now the single source in GAAP for the definition of fair value, except for the fair value of leased property as defined in SFAS 13. ASC 820-10 establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions, about market participant assumptions, that are developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under ASC 820-10 are described below:
•
Level
Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
•
Level
Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.
•
Level
Inputs that are both significant to the fair value measurement and unobservable. These inputs rely on management's own assumptions about the assumptions that market participants would use in pricing the asset or liability. (The unobservable inputs are developed based on the best information available in the circumstances and may include the Company's own data.)
The following presents the Company's fair value hierarchy for those assets and liabilities measured at fair value on a non-recurring basis as of December 31, 2009 and 2008:
Level 1: None
Level 2: None
Level 3: None
Total Gain (Losses): None
NOTE 8. OPERATING LEASE
The Company leased office space under an operating lease which expired in July 2009. The lease continued on a month-to-month basis after it expired. Rent expense for the period ended December 31, 2009 amounted to $2,200.
NOTE 9. THE EFFECT OF RECENTLY ADOPTED AND ISSUED ACCOUNTING STANDARDS
RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS - Effective June 30, 2009, the Company adopted a new accounting standard issued by the FASB related to the disclosure requirements of the fair value of the financial instruments. This standard expands the disclosure requirements of fair value (including the methods and significant assumptions used to estimate fair value) of certain financial instruments to interim period financial statements that were previously only required to be disclosed in financial statements for annual periods. In accordance with this standard, the disclosure requirements have been applied on a prospective basis and did not have a material impact on the Company’s financial statements.
On September 30, 2009, the Company adopted changes issued by the Financial Accounting Standards Board (FASB) to the authoritative hierarchy of GAAP. These changes establish the FASB Accounting Standards Codification (Codification) as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with GAAP. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The FASB will no longer issue new standards in the form of Statements, FASB Staff Positions, or Emerging Issues Task Force Abstracts; instead the FASB will issue Accounting Standards Updates. Accounting Standards Updates will not be authoritative in their own right as they will only serve to update the Codification. These changes and the Codification itself do not change GAAP. Other than the manner in which new accounting guidance is referenced, the adoption of these changes had no impact on the Financial Statements.
RECENTLY ISSUED ACCOUNTING STANDARDS - In January 2010, the FASB issued Accounting Standards Update 2010-02, Consolidation (Topic 810): Accounting and Reporting for Decreases in Ownership of a Subsidiary. This amendment to Topic 810 clarifies, but does not change, the scope of current US GAAP. It clarifies the decrease in ownership provisions of Subtopic 810-10 and removes the potential conflict between guidance in that Subtopic and asset derecognition and gain or loss recognition guidance that may exist in other US GAAP. An entity will be required to follow the amended guidance beginning in the period that it first adopts FAS 160 (now included in Subtopic 810-10). For those entities that have already adopted FAS 160, the amendments are effective at the beginning of the first interim or annual reporting period ending on or after December 15, 2009. The amendments should be applied retrospectively to the first period that an entity adopted FAS 160. The Company does not expect the provisions of ASU 2010-02 to have a material effect on the financial position, results of operations or cash flows of the Company.
In January 2010, the FASB issued Accounting Standards Update 2010-01, Equity (Topic 505): Accounting for Distributions to Shareholders with Components of Stock and Cash (A Consensus of the FASB Emerging Issues Task Force). This amendment to Topic 505 clarifies the stock portion of a distribution to shareholders that allows them to elect to receive cash or stock with a limit on the amount of cash that will be distributed is not a stock dividend for purposes of applying Topics 505 and 260. Effective for interim and annual periods ending on or after December 15, 2009, and would be applied on a retrospective basis. The Company does not expect the provisions of ASU 2010-01 to have a material effect on the financial position, results of operations or cash flows of the Company.
In December 2009, the FASB issued Accounting Standards Update 2009-17, Consolidations (Topic 810): Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities. This Accounting Standards Update amends the FASB Accounting Standards Codification for Statement 167. The Company does not expect the provisions of ASU 2009-17 to have a material effect on the financial position, results of operations or cash flows of the Company.
In December 2009, the FASB issued Accounting Standards Update 2009-16, Transfers and Servicing (Topic 860): Accounting for Transfers of Financial Assets. This Accounting Standards Update amends the FASB Accounting Standards Codification for Statement 166. The Company does not expect the provisions of ASU 2009-16 to have a material effect on the financial position, results of operations or cash flows of the Company.
In October 2009, the FASB issued Accounting Standards Update 2009-15, Accounting for Own-Share Lending Arrangements in Contemplation of Convertible Debt Issuance or Other Financing. This Accounting Standards Update amends the FASB Accounting Standard Codification for EITF 09-1. The Company does not expect the provisions of ASU 2009-15 to have a material effect on the financial position, results of operations or cash flows of the Company.
NOTE 10. GOING CONCERN
The Company's financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established
In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management's plans to obtain such resources for the Company include (1) obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses, and (2) seeking out and completing a merger with an existing operating company. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.
The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
NOTE 11. SUBSEQUENT EVENTS
Agreement of Merger and Plan of Reorganization
On February 10, 2010, the Company entered into an Agreement of Merger and Plan of Reorganization (the “Merger Agreement”) with Go Solar USA, Inc., a privately held Wyoming corporation (“GUSA”). Upon closing of the transaction contemplated under the Merger Agreement (the “Merger”), GUSA merged with and into the Company. The Company immediately affected a name change and will hereinafter be known as Go Solar USA, Inc. after February 10, 2010. The Merger was accounted for as a reverse merger and recapitalization with GUSA being the continuing entity. GUSA is the acquirer for financial reporting purposes and the Company is the acquired company. Consequently, the assets and liabilities and the operations that will be reflected in the historical financial statements prior to the Merger will be those of GUSA and will be recorded at the historical cost basis of GUSA, and the consolidated financial statements after completion of the Merger will include the assets and liabilities of the Company and GUSA, historical operations of GUSA and operations of the Company from the closing date of the Merger.
We intend to carry on the business of GUSA as our sole line of business. Upon closing of the Merger, we relocated our executive offices to 201 St. Charles Avenue, Suite 2500, New Orleans, LA 70170 and our telephone number is (504) 582-1110.
At the closing of the Merger, each share of GUSA common stock issued and outstanding immediately prior to the closing of the Merger was exchanged for the right to receive 15 shares of our common stock. To the extent that there are fractional shares, such fractional shares will be rounded to the nearest whole share. Accordingly, an aggregate of 15,000,000 shares of our common stock were issued to the holders of GUSA common stock.
Departure of Sole Officer and Director
Upon the closing of the Merger, Margaret Burton resigned as our sole officer and director. J. David Brotherton was appointed as Chief Executive Officer and director of the Company.
NOTE 12. RESTATEMENT
The financial statements presented herein as of and for the year ended December 31, 2008 have been restated for errors in the valuation of cash and property and equipment. In order to correct the error described above, the Company has restated its financial statements as of and for the year ended December 31, 2008.
The effect of the restatement on the Company’s balance sheet as of December 31, 2008 is as follows:
(a)
Liabilities were reclassified as current liabilities of discontinued operations in the balance sheet as of December 31, 2008 due to the Company’s decision in 2009 to discontinue its ATM business.
(b)
Assets were written off to net realizable value.
(c)
Retained deficit recognized during the development stage was reclassified to Deficit accumulated since re-entry into development stage in the balance sheet as of December 31, 2008.
The effect of the restatement on the Company’s statement of operations for the year ended December 31, 2008 is as follows:
(a)
Results of operations related to discontinued operations were reclassified to Net loss from discontinued operations for the year ended December 31, 2008.
ITEM 9
ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9 - A - CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. To address the material weaknesses, we performed additional analysis and other post-closing procedures in an effort to ensure our consolidated financial statements included in this annual report have been prepared in accordance with generally accepted accounting principles. Accordingly, management believes that the financial statements included in this report fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented.
Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Securities Exchange Act, as amended. Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2009. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company's annual or interim financial statements will not be prevented or detected on a timely basis. We have identified the following material weaknesses.
1.
As of December 31, 2009, we did not maintain effective controls over the control environment. Specifically, we have not formally adopted a written code of business conduct and ethics that governs to the Company’s employees, officers and directors. Additionally, we have not developed and effectively communicated to our employees its accounting policies and procedures. This has resulted in inconsistent practices. Further, the Board of Directors does not currently have any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-B. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness.
2.
As of December 31, 2009, we did not maintain effective controls over financial statement disclosure. Specifically, controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Accordingly, management has determined that this control deficiency constitutes a material weakness.
Because of these material weaknesses, management has concluded that the Company did not maintain effective internal control over financial reporting as of December 31, 2009, based on the criteria established in "Internal Control-Integrated Framework" issued by the COSO.
Changes in Internal Control Over Financial Reporting
No change in the Company’s internal control over financial reporting occurred during the quarter ended December 31, 2009, that materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this annual report.
Corrective Action
None.
ITEM 9 - B - OTHER INFORMATION
None.
PART III
ITEM 10
ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
The Directors and Executive Officers of the Company and certain information concerning them are set forth below as of February 28, 2010:
Name
Position
Age
Margaret Burton
Chairman/President
Principal Financial Officer
Ms. Margaret A. Burton, 46, is a graduate of Trident Charleston Technical and Onondaga Medical Career School and has earned a Teaching Assistant Certification from the New York State Dept. of Education. Ms. Burton was employed as a Teaching Assistant by Jamesville-Dewitt Central School from October 9, 1997 through November of 2000. She was employed as Parent Advocate by the Jamesville-Dewitt School District from September 2002 through June 2005. Since September 2005, she has been employed part-time as a Teaching assistant with Jamesville-Dewitt Central School. Ms. Burton began serving as a Director and Secretary of Fresca Worldwide Trading Corp. in January 2006 and as sole Officer and Director, President, CEO and Secretary from June 27, 2007 to September 26, 2008.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Based solely upon review of Forms 3, 4, and 5 furnished to us during the most recent fiscal year, we believe that all persons required to file reports pursuant to Section 16(a) of the Exchange Act have done so in a timely manner.
Section 16(a) of the Securities Exchange Act of 1934 requires our Directors and Executive Officers, and persons who own beneficially more than ten percent of our common stock, to file reports of their stock ownership and changes of their stock ownership with the Securities and Exchange Commission. Based solely on the reports we have received and on written representations from certain reporting persons, we believe that the directors, executive officers, and our greater than ten percent beneficial owners have complied with all applicable filing requirements for the fiscal year ended December 31, 2009.
CODE OF ETHICS
Our Board of Directors has discussed the adoption of a code of business conduct and ethics for directors, officers and employees but has not yet adopted a Code of Ethics. It is anticipated that the Board of Directors will adopt a Code of Ethics in the near future. Upon adoption of a Code of Ethics, we will comply with all SEC reporting requirements.
STOCKHOLDER COMMUNICATIONS WITH THE BOARD OF DIRECTORS
Stockholders may communicate with the full Board, or any individual directors, by sending such written communication to the following address:
Fresca Worldwide Trading Corporation
Attn: Corporate Secretary
Oswego Road
Liverpool, New York 13090
ITEM 11
ITEM 11 - EXECUTIVE COMPENSATION
We have not paid any salary, bonus or other compensation to Margaret A. Burton, our sole officer and director, since our inception. We presently have no compensation arrangements with Ms. Burton.
EMPLOYMENT AGREEMENTS
We do not currently have any employment agreements.
DIRECTOR COMPENSATION
We have not paid any salary, bonus or other compensation to Margaret A. Burton, our sole officer and director, since our inception. It is our policy to pay director expenses in attending board meetings. During the year ended December 31, 2009, Ms. Burton was not reimbursed for any director expenses.
ITEM 12
ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of December 31, 2009, with respect to the beneficial ownership of shares of the Company’s common stock by (i) each person known to us who owns beneficially more than 5% of the outstanding shares of the Company’s common stock, (ii) each of our Directors, (iii) each of our Executive Officers, and (iv) all of our Executive Officers and Directors as a group. Unless otherwise indicated, each stockholder has sole voting and investment power with respect to the shares shown. As of December 31, 2009, there were 2,100,000 shares of the Company’s common stock issued and outstanding.
(1)
Under Rule 13d-3 promulgated under the Exchange Act, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person’s actual ownership or voting power with respect to the number of shares of common stock actually outstanding on December 31, 2009.
ITEM 13
ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None of the following persons has any direct or indirect material interest in any transaction to which we were or are a party during the past two years, or in any proposed transaction to which we propose to be a party:
(A)
any of our directors or executive officers;
(B)
any nominee for election as one of our directors;
(C)
any person who is known by us to beneficially own, directly or indirectly, shares carrying more than 5% of the voting rights attached to our common stock; or
(D)
any member of the immediate family (including spouse, parents, children, siblings and in-laws) of any of the persons named in paragraph (A), (B) or (C) above.
ITEM 14
ITEM 14 - PRINCIPAL ACCOUNTANT FEES AND SERVICES
The following is a summary of the fees billed to the Company by its independent accountants for the years ended December 31, 2009 and 2008:
Notes to the Accountants Fees Table:
(1)
Consists of fees for assurance and related services by our principal accountants that are reasonably related to the performance of the audit or review of the Company's financial statements and are not reported under "Audit Fees."
(2)
Consists of fees for professional services rendered by our principal accountants for tax related services.
(3)
Consists of fees for products and services provided by our principal accountants, other than the services reported under "Audit Fees," "Audit-Related Fees" and "Tax Fees" above.
ITEM 15
ITEM 15 - EXHIBITS
The following documents are included or incorporated by reference as exhibits to this report:
3.1
Articles of Incorporation, dated December 29, 2003 (incorporated by reference from the Company's SB-2 Registration Statement (File No.: 333-145882).
3.2
Certificate of Amendment to Certificate of Incorporation, dated May 2, 2007 (incorporated by reference from the Company's SB-2 Registration Statement (File No.: 333-145882).
3.3
Bylaws (incorporated by reference from the Company's SB-2 Registration Statement (File No.: 333-145882).
31.1
Certification of Mr. Brotherton as required by Rule 13a - 14(1) or Rule 15d - 14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1
Certification of Mr. Brotherton pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and Section 1350 of 18 U.S.C. 63.*
* Filed herewith.
AVAILABLE INFORMATION
We are a reporting company and file annual, quarterly and special reports, proxy statements and other information with the Securities and Exchange Commission. You may inspect and copy these materials at the Public Reference Room maintained by the Commission at Room 100 F Street, N.W., Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for more information on the Public Reference Room. You can also find our Commission filings at the Commission's website at www.sec.gov. We intend to furnish our stockholders with annual reports containing audited financial statements and such other periodic reports as we may determine to be appropriate or as may be required by law.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Go Solar USA, Inc.
By:
/s/ J. David Brotherton
J. David Brotherton
President
(Principal Executive Officer and
Principal Accounting Officer)
Date: May 4, 2010