XOTC:WWAG Quarterly Report 10-Q Filing - 6/30/2012

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

 þ      Quarterly  report  pursuant  to  Section  13  or  15(d)  of  the  Securities  Exchange  Act  of  1934  for  the

quarterly period ended June 30, 2012.

 o      Transition  report  pursuant  to  Section  13  or  15(d)  of  the  Securities  Exchange  Act  of  1934  for  the

transition period from

to

.

Commission file number: 000-26927

WWA GROUP, INC.

(Exact name of registrant as specified in its charter)

Nevada

77-0443643

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

700 Lavaca Street, Suite 1400 Austin, Texas 78701

(Address of principal executive offices)    (Zip Code)

(480) 505-0070

(Registrant’s telephone number, including area code)

n/a

(Former name or former address, if changed since last report)

Indicate  by  check  mark  whether  the  registrant:  (1)  filed  all  reports  required  to  be  filed  by  Section  13  or

15(d)  of  the  Exchange  Act  during  the  past  12  months  (or  for  such  shorter  period  that  the  registrant  was

required to file such reports), and (2) has been subject to such filing requirements for the past 90 days:

Yes þ   No o.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate

Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of

Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the

registrant was required to submit and post such files). Yes þ   No o.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-

accelerated filer, or a smaller reporting company as defined by Rule 12b-2 of the Exchange Act:

Large accelerated filer o   Accelerated filer o   Non-accelerated filer o  Smaller reporting company þ

Indicate  by  check  mark  whether  the  registrant  is  a  shell  company  (as  defined  in  Rule  12b-2  of  the

Exchange Act): Yes o  No þ

Indicate the number of  shares outstanding of each of  the issuer’s classes of  common stock,  as of  the latest

practicable  date.  The  number  of  shares  outstanding  of  the  issuer’s  common  stock,  $0.001  par  value  (the

only class of voting stock), at August 15, 2012, was 23,841,922.




TABLE OF CONTENTS

PART I – FINANCIAL  INFORMATION

Item 1.     Financial Statements ............................................................................................................... 3

Condensed Consolidated Balance Sheets as of June 30, 2012 (unaudited) and

December 31, 2011 (audited).................................................................................................. 4

Condensed Unaudited Consolidated Statements of Income for the three and six month

periods ended June 30, 2012 and June 30, 2011 ..................................................................... 5

Condensed Unaudited Consolidated Statements of Cash Flows for the six month

periods ended June 30, 2012 and June 30, 2011….……………………………………  6

Notes to Condensed  Unaudited Consolidated  Financial Statements ....................................... 7

Item 2.     Management's Discussion and Analysis of Financial Condition and Results of Operations ... 17

Item 3.     Quantitative and Qualitative Disclosures about Market Risk.................................................. 23

Item 4.     Controls and  Procedures ......................................................................................................... 24

PART II – OTHER INFORMATION

Item 1.     Legal Proceedings................................................................................................................... 25

Item 1A.   Risk Factors ............................................................................................................................ 25

Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds................................................. 27

Item 3.     Defaults  upon Senior Securities .............................................................................................. 27

Item 4.     Mine Safety Disclosures ......................................................................................................... 27

Item 5.     Other Information ................................................................................................................... 27

Item 6.     Exhibits................................................................................................................................... 27

Signatures ............................................................................................................................................... 28

Index to Exhibits..................................................................................................................................... 29

2




PART I – FINANCIAL  INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

As used herein, the terms “WWA Group”, “we,” “our,” and “us” refer to WWA Group, Inc., a Nevada

corporation, unless otherwise indicated.   In the opinion of management, the accompanying unaudited

financial statements included in this Form 10-Q reflect all adjustments (consisting only of normal

recurring accruals) necessary for a fair presentation of the results of operations for the periods presented.

The results of operations for the periods presented are not necessarily indicative of the results to be

expected for the full year.

3




WWA GROUP, INC.

Condensed Consolidated Balance Sheets

June 30,

December 31,

Assets

2012

2011

(Unaudited)

(Audited)

Current assets:

Cash

$

2,725

$

49,010

Receivables, net

-

-

Advances to suppliers

-

-

Inventories

-

-

Prepaid expenses

-

32,406

Notes receivable

-

-

Other current assets

10

14,719

Total current assets

2,735

96,136

Property and equipment, net

-

-

Goodwill

-

181,250

Notes receivable

-

-

Investment in related party entity

-

-

Other assets

-

-

Total Assets

$

2,735     $

277,386

Liabilities and Stockholders' Equity

Current liabilities:

Accounts payables

$

-    $

27,856

Accrued expenses

594

170,563

Line of credit

-

-

Short Term Debt - Notes Payable

-

361,840

Current maturities of long-term debt

-

-

Total current liabilities

594

560,259

Long-term debt

$

-    $

-

Total liabilities

594

560,259

Commitments and contingencies

$

-    $

-

Stockholders' equity:

Common stock, $0.001 par value, 50,000,000 shares

authorized; 23,841,922 and 22,591,922 shares

Respectively issued and outstanding

23,842

22,592

Additional paid-in capital

4,472,830

4,449,080

Retained earnings

(4,494,531)

(4,650,299)

Non-controlling interest

-

(104,247)

Total stockholders' equity (deficit):

2,141

(282,874)

Total liabilities and stock holders' equity

$

2,735     $

277,386

See accompanying condensed notes to consolidated reviewed financial statements.

4




WWA GROUP, INC.

Consolidated Statements of Income

Three months ended June 30

Six months ended June 30

Unaudited

Unaudited

Unaudited

Unaudited

2012

2011

2012

2011

Revenues from commissions and services

$

-     $

-      $

-      $

-

Revenues from sales of equipment

-

-

-

-

Revenues from Ship Charter

-

-

-

-

Total revenues

$

-      $

-     $

-

$

-

Direct costs - commissions and services

-

-

-

-

Direct costs - sales of equipment

-

-

-

-

Gross profit

$

-      $

-     $

-      $

-

Operating expenses:

General, selling and administrative expenses

41,979

8,853

66,926

14,685

Salaries and wages

-

-

-

-

Selling expenses

-

-

-

-

Depreciation and amortization expense

-

-

-

-

Total operating expenses

$

41,979

$

8,853      $

66,926

$

14,685

(Loss) income from operations

$     (41,979)      $

(8,853)      $

(66,926)      $

(14,685)

Other income (expense):

Interest expense

-

-

-

-

Impairment of Notes receivables

-

-

-

(1,711,003)

Gain (loss) on Equity investment

101,168

(384,850)

105,168

(384,850)

Interest income

-

-

-

-

Other income (expense)

86,565

0

96,565

(2)

Total other income (expense)

187,733

(384,850)

201,733

(2,095,854)

Income before income taxes

145,754

(393,702)

134,807

(2,110,539)

Provision for income taxes

$

-      $

-     $

-      $

-

Net income (loss) from operations

$      145,754      $     (393,702)      $      134,807      $   (2,110,539)

Basic earnings (loss)  per common share

$

0.01      $

(0.02)

$

0.01      $

(0.09)

Diluted earnings per common share

$

-      $

-

-

-

Weighted average shares - Basic

23,841,922

22,591,922

23,841,922

22,591,922

Weighted average shares - Diluted

22,921,592

22,591,922

22,756,757

22,591,922

Net Income (Loss)

$      145,754      $     (393,702)      $      134,807      $   (2,110,539)

Other Comprehensive income  (loss)

$

-      $

-     $

-      $

-

Total Comprehensive income (loss)

$      145,754      $     (393,702)      $      134,807      $   (2,110,539)

See accompanying condensed notes to consolidated reviewed financial statements.

5




WWA GROUP, INC.

Condensed Consolidated Statements of Cash Flow

(Unaudited)

Six Months Ended June 30,

2012

2011

Cash flows from operating activities:

Net income ( loss)

$

134,807     $

(2,110,539)

Adjustments to reconcile net income to net cash

provided by operating activities

Depreciation and amortization

-

-

(Gain) loss on disposition of assets

-

-

(Gain) loss on equity investment

(105,168)

(384,850)

Difference in retained earnings due to non-consolidation of IDVC

20,961

-

Changes in operating assets and liabilities:

Decrease (Increase) in:

Accounts receivable

-

-

Advance to suppliers

-

-

Inventories

-

-

Prepaid expenses

32,406

-

Other current assets

14,709

-

Impairment of notes receivable

-

1,711,003

Increase (decrease) in:

Auction proceeds payable

-

-

Accounts payable

(27,856)

-

Accrued liabilities

(169,969)

21,512

Net cash used in operating activities

(100,110)

(36,199)

Cash flows from investing activities:

Purchase of property and equipment

-

-

(Increase) decrease in not receivable

-

33,000

(Increase) decrease in goodwill

181,250

-

(Increase) decrease in non-controlling interest

104,247

-

Proceeds from sale of fixed assets

-

-

Net cash provided by  investing activities

285,497

33,000

Cash flows from financing activities:

Increase (decrease) in line of credit

-

-

Payments/Proceeds from short-term notes payable

(361,840)

1,169

Debt settlement by issuance of equity investment

105,168

-

Debt settlement by issuance of common stock

25,000

-

Net cash provided by (used in) financing activities

(231,672)

1,169

Net decrease in cash and cash equivalents

(46,285)

(2,030)

Cash and cash equivalents at beginning of year

49,010

3,835

Cash and cash equivalents at end of period

$

2,725

$

1,805

See accompanying condensed notes to consolidated reviewed financial statements.

6




WWA GROUP, INC

NOTES TO  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, 2012

NOTE A – ORGANIZATION AND BASIS OF PRESENTATION

WWA Group, Inc., (“WWA Group”) operated through October 31, 2010 in Jebel Ali, Dubai, United Arab

Emirates (U.A.E) under a trade license from the Jebel Ali Free Zone Authority. Operations consisted of

auctioning off  used and new heavy construction equipment, transportation equipment and  marine

equipment, the majority of which on a consignment basis. During the year ended December 31, 2011,

subsequent to October 31, 2010 WWA Group’s operations primarily consisted of focusing on developing

its subsidiary, and assisting in the growth of its investment entity.

On October 31, 2010, WWA Group sold its 100% interest in its wholly owned subsidiaries,  World Wide

and Crown to Seven International Holdings, Ltd. (“Seven”), a Hong Kong based investment company for

an assumption by Seven of all the assets and liabilities of the World Wide subject to certain exceptions.

The disposition did not affect WWA Group’s interest in Asset Forum, LLC., its ownership of proprietary

on-line auction software or its equity interest in Infrastructure Developments Corp. (“Infrastructure”).

On April 14, 2010, Intelspec International,  Inc. (“Intelspec”), our former minority owned unconsolidated

subsidiary, concluded an agreement with Infrastructure, a publicly traded company, pursuant to which

Intelspec became a subsidiary of Infrastructure. WWA Group acquired an approximately 22% interest in

Infrastructure as a result of the transaction. In July 2010, WWA Group sold 4,000,000 shares of

Infrastructure at a value of $320,000 reducing WWA Group’s investment to 17.75%. Further on

November 21, 2011 WWA Group acquired 165,699,842 shares of common stock of Infrastructure on

conversion of WWA Group’s convertible promissory note. On December 31, 2011 WWA Group owned

63.38% of Infrastructure making it a controlling shareholder of Infrastructure causing Infrastructure’s

financials to be consolidated with those of WWA Group, Inc. However, as of June 30, 2012 WWA

Group’s shareholding in Infrastructure has decreased to 29.62% due to certain debt settlements amounting

to a disposition of an aggregate of 67,509,667 IDVC shares. Since WWA Group is no longer a controlling

shareholder it no longer consolidates its accounts with that of Infrastructure as of June 30, 2012.

WWA Group includes the accounts of its subsidiary,  Asset Forum LLC.

The consolidated financial statements present the financial position, results of operation, changes in

stockholder’s equity and cash flows of WWA Group and its subsidiaries. All significant inter-company

balances and transactions have been eliminated.

NOTE B – GOING CONCERN

The accompanying consolidated financial statements have been prepared on a going concern basis, which

contemplates the realization of assets and liabilities in the normal course of business. Accordingly, they

do not include any adjustments relating to the realization of the carrying value of assets or the amounts

and classification of liabilities that might be necessary should WWA Group be unable to continue as a

going concern. WWA Group has accumulated losses and working capital and cash flows from operations

are negative which raises doubt as to the validity of the going concern assumptions. These financials do

not include any adjustments to the carrying value of the assets and liabilities, the reported revenues and

expenses and balance sheet classifications used that would be necessary if the going concern assumption

were not appropriate; such adjustments could be material.

7




WWA GROUP, INC

NOTES TO  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, 2012

NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This summary of significant accounting policies of WWA Group and its subsidiaries is presented to assist

in understanding WWA Group’s financial statements. The financial statements and notes are

representations of  WWA Group’s management who is responsible for the integrity and objectivity of the

financial statements. These accounting policies conform to generally accepted accounting principles and

have been consistently applied in the preparation of the financial statements.

Basis of Presentation

The consolidated financial statements present the financial position, results of operation, changes in

stockholder’s equity and cash flows of WWA Group and its subsidiaries. All significant inter-company

balances and transactions have been eliminated. Investments in entities in which WWA Group can

exercise significant influence, but does not own a majority equity interest or otherwise control, are

accounted for using the equity method and are included as investments in equity interests on the

consolidated balance sheets. Effective July 1, 2009, WWA Group adopted the Accounting Standards

Codification (the “Codification”), as issued by the FASB. The Codification became the single source of

authoritative generally accepted accounting principles (“GAAP”) in the U.S.

Cash and Cash Equivalents

WWA Group considers all highly liquid investments purchased with maturity of three months or less to

be cash equivalents.

As of June 30, 2012, there were no cash and cash equivalents held with a bank as compensating balance

against borrowing arrangements.

Concentration of Credit Risk

WWA Group’s financial instruments that are exposed to concentrations of credit risk consist primarily of

cash and cash equivalents, accounts receivable, and investments. WWA Group’s cash and cash

equivalents are maintained with high-quality international banks and financial institutions.  WWA Group

believes no significant concentration of credit risk exists with respect to these cash investments.

WWA Group routinely assesses the financial strength of its customers and provides an allowance for

doubtful accounts as necessary. Credit losses have been minimal to date.

Accounts Receivable and Allowance for Doubtful Accounts

WWA Group grants credit terms in the normal course of business to its customers.  Accounts receivables

are stated at the amount management expects to collect from outstanding balances after discounts and bad

debts, taking into account credit worthiness of customers and history of collection.

The allowance for doubtful accounts is based  on specifically identified amounts that management

believes to be uncollectible.  If actual collections experience changes, revisions to the allowance may be

required. No allowance for doubtful accounts is provided as company is collecting amount without

default.

8




WWA GROUP, INC

NOTES TO  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, 2012

NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Inventory

Inventories consist of equipment to be sold in auctions and otherwise, stated at the lower of cost or

market. The cost is determined by specific identification method. Cost includes purchase price, freight,

insurance, duties and other incidental expenses incurred in bringing inventories to their present location

and condition. WWA Group records a reserve if the fair value of inventory is determined to be less than

the cost.

Property and Equipment

Property and equipment are stated at cost less depreciation and provision for impairment where

appropriate. Depreciation expense is computed using the straight-line method over estimated useful lives

of three to five years except for the vessel in which case the estimated useful life is twenty years. Gains

and losses on depreciable assets retired or sold are recognized in the statement of operations in the year of

disposal. All repair and maintenance costs are expensed as incurred.

Impairment of Long-Lived Assets

WWA Group reviews long-lived assets such as property, equipment, investments and definite-lived

intangibles for impairment annually and whenever events or changes in circumstances indicate that the

carrying value of an asset may not be recoverable. As required by Statement FASB Accounting Standard

Codification 360, WWA Group uses an estimate of the future undiscounted net cash flows of the related

asset or group of assets over their remaining economic useful lives in measuring whether the assets are

recoverable.  If the carrying amount of an asset exceeds its estimated future cash flows, an impairment

charge is recognized for the amount by which the carrying amount exceeds the estimated fair value of the

asset.  Impairment of long-lived assets is assessed at the lowest levels for which there are identifiable cash

flows that are independent of other groups of assets.  Assets to be disposed of are reported at the lower of

the carrying amount or fair value, less the estimated costs to sell.  In addition, depreciation of the asset

ceases. During the six months period ended June 30, 2012, no significant impairment of long-lived assets

was recorded.

Investment in Equity Interest

WWA Group has approximately a 29.62% shareholding in its equity investment in Infrastructure as of

June 30, 2012. During the year ended December 31, 2010 the company had maintained the accounts

under the equity method of accounting whereby WWA Group recorded its proportionate share of the net

income or loss of the equity interest up to June 30, 2010. On November 21, 2011WWA Group converted

its Notes Receivable into an equity investment and received 165,699,842 shares increasing its interest to a

63% interest in Infrastructure. Since WWA Group became a majority share holder of Infrastructure as of

November 21, 20111 it consolidated its financials with those of Infrastructure as of December 31, 2011

and March 31, 2012. As of June 30’ 2012 WWA Group no longer consolidates its accounts with those of

Infrastructure due the decrease in its interest and the full impairment of its remaining equity investment in

Infrastructure.

9




WWA GROUP, INC

NOTES TO  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, 2012

NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Investment in Related Party

WWA Group did not have any investment in related party as of June 30, 2012. Until October 31, 2010

WWA Group accounted for its equity investment in a foreign affiliate using the fair value measurement

principles. WWA Group reviews its investments annually for impairment and records permanent

impairments as a loss on the income statement.

Revenue Recognition

Revenues from commissions and services consist of revenues earned in WWA Group’s capacity as agent

for consignors of equipment, incidental interest income, internet and proxy purchase fees, and handling

fees on the sale of certain lots. All commission revenue is recognized when the auction sale is complete,

the equipment is delivered to the buyer, and WWA Group has determined that the auction proceeds are

collectible. Revenues from sales of equipment originate from the auctioned sale of equipment inventory

owned by WWA Group. WWA Group recognizes the revenue from such sales when the auction has been

completed, the equipment has been delivered to the purchaser, and collectability is reasonably assured.

All costs of goods sold are accounted for under direct costs.

Revenues from sales of equipment originate from the auctioned and private sale of equipment inventory

owned by the Company. WWA Group recognizes the revenue from such sales when the sale has been

invoiced, the equipment has been delivered to the purchaser, and collectability is reasonably assured.  All

costs of goods sold are accounted for under direct costs

Income Taxes

Deferred income taxes are determined based on the differences between the financial reporting and tax

bases of assets and liabilities and are measured using the currently enacted tax rates and laws. WWA

Group records a valuation allowance against particular deferred income tax assets if it is more likely than

not that those assets will not be realized. The provision for income taxes comprises WWA Group’s

current tax liability and change in deferred income tax assets and liabilities.

Significant judgment is required in evaluating WWA Group’s uncertain tax positions and determining its

provision for income taxes. WWA Group establishes reserves for tax-related uncertainties based on

estimates of whether, and the extent to which, additional taxes will be due. These reserves are established

when WWA Group believes that certain positions might be challenged despite its belief that its tax return

positions are in accordance with applicable tax laws. WWA Group adjusts these reserves in light of

changing facts and circumstances, such as the closing of a tax audit, new tax legislation, or the change of

an estimate. To the extent that the final tax outcome of these matters is different than the amounts

recorded, such differences will affect the provision for income taxes in the period in which such

determination is made. The provision for income taxes includes the effect of reserve provisions and

changes to reserves that are considered appropriate, as well as the related net interest and penalties.

10




WWA GROUP, INC

NOTES TO  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, 2012

NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  (Continued)

Share-Based Compensation

For   stock-based   awards   granted   on   or   after   January   1,   2006,   WWA   Group   records   stock-based

compensation  expense  based  on  the  grant  date  fair  value,  estimated  in  accordance  with  the  provisions  of

ASC 718 and ASC 505-50.

Under the 2006 Benefit Plan of WWA Group, Inc., WWA Group may issue stock, or grant options to

acquire, up to 2,500,000 shares of WWA Group's common stock to employees or other individuals

including consultants or advisors, who render services to WWA Group or our subsidiaries.  As of

December 31, 2011 1,250,000 registered securities remained available for issuance or grant under the

Plan. On June 6, 2012 WWA Group authorized and approved the issuance of remaining 1,250,000

common shares available pursuant to the Plan valued at $0.02 a share.

.

Foreign Exchange

WWA Group’s reporting currency is the United States dollar. WWA Group’s functional currency is also

the U.S. Dollar. (“USD”) Transactions denominated in foreign currencies are translated into  USD and

recorded at the foreign exchange rate prevailing at the date of the transaction. Monetary assets and

liabilities denominated in foreign currencies,  which are stated at historical cost, are translated into USD

at the foreign exchange rates prevailing at the balance sheet date. Realized and unrealized foreign

exchange differences arising on translation are recognized in the income statement.

11




WWA GROUP, INC

NOTES TO  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, 2012

NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Fair Value Measurements

Effective July 1, 2008, WWA Group adopted new fair value accounting guidance. The adoption of the

guidance was applied to long-lived assets such as property, equipment, investments and definite-lived

intangibles. The guidance defines fair value as the price that would be received from selling an asset or

paid to transfer a liability in an orderly transaction between market participants at the measurement date.

When determining the fair value measurements for assets and liabilities required or permitted to be

recorded at fair value, WWA Group considers the principal or most advantageous market in which WWA

Group would transact business and considers assumptions that market participants would use when

pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

The guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable

inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s

categorization within the fair value hierarchy is based upon the lowest level of input that is significant to

the fair value measurement. The guidance establishes three levels of inputs that may be used to measure

fair value:

Level 1 — Quoted prices in active markets for identical assets or liabilities.

Level 2 — Observable inputs other than Level 1 prices such as quoted prices for similar assets or

liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active

markets); or model-derived valuations in which all significant inputs are observable or can be derived

principally from or corroborated by observable market data for substantially the full term of the assets or

liabilities.

Level 3 — Unobservable inputs to the valuation methodology those are significant to the measurement of

fair value of assets or liabilities.

All of WWA Group’s available-for-sale investments and non-marketable equity securities are subject to a

periodic impairment review.  Investments are considered to be impaired when a decline in fair value is

judged to be other-than-temporary. This determination requires significant judgment. For publicly traded

investments, impairment is determined based upon the specific facts and circumstances present at the

time, including a review of the closing price over the previous six months, general market conditions and

WWA Group’s intent and ability to hold the investment for a period of time sufficient to allow for

recovery. For non-marketable equity securities, the impairment analysis requires the identification of

events or circumstances that would likely have a significant adverse effect on the fair value of the

investment, including revenue and earnings trends, overall business prospects and general market

conditions in the investees’ industry or geographic area.  Investments identified as having an indicator of

impairment are subject to further analysis to determine if the investment is other-than-temporarily

impaired, in which case the investment is written down to its impaired value.

12




WWA GROUP, INC

NOTES TO  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, 2012

NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Income per Common Share

The computation of basic earnings per common share is based on the weighted average number of shares

outstanding during each year. The computation of diluted earnings per common share is based on the

weighted average number of shares outstanding during the year, plus the common stock equivalents that

would arise from the exercise of stock options and warrants outstanding, using the treasury stock method

and the average market price per share during the year. As of June 30, 2012 there were no outstanding

common stock equivalents.

Use of Estimates

The preparation of the financial statements in conformity with generally accepted accounting principles in

United States of America requires management to make estimates and assumptions that affect the

reported amounts of assets and liabilities and  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.

Recent accounting pronouncements

In December 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards

Update (ASU) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities”, which will require

disclosures for entities with financial instruments and derivatives that are either offset on the balance

sheet in accordance with ASC 210-20-45 or ASC 815-10-45, or are subject to a master netting

arrangement. ASU No. 2011-11 is effective for interim and annual periods beginning on or after January

1, 2013. WWA Group currently evaluating the impact of the adoption of ASU 2011-11 on its financial

position, results of operations, and disclosures.

In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income, Presentation of

Comprehensive Income and in December 2011, the FASB issued ASU No. 2011-12, Deferral of the

Effective Date for Amendments to the Presentation of Reclassification of Items out of Accumulated Other

comprehensive Income in ASU 2011-05 to increase the prominence of items reported in other

comprehensive income. Specifically, the new guidance allows an entity to present components of net

income or other comprehensive income in one continuous statement, referred to as the statement of

comprehensive income, or in two separate, but consecutive statements. The new guidance eliminates the

current option to report other comprehensive income and its components in the consolidated statement of

shareholders' equity. While the new guidance changes the presentation of comprehensive income, there

are no changes to the components that are recognized in net income or other comprehensive income under

current accounting guidance. This new guidance is effective for fiscal years and interim periods beginning

after December 15, 2011. We adopted this guidance on January 1, 2012 and have presented a new

financial statement titled Condensed Consolidated Statement of Comprehensive Income for the six month

periods ending June 30, 2012 and April 2, 2011.

13




WWA GROUP, INC

NOTES TO  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, 2012

NOTE D – INVESTMENTS

Investment in Equity Interest

In December 2006, WWA Group acquired a 32.5% interest in Power Track Projects, FZE (“PTP”) for a

consideration of $1,786,000. PTP is a Dubai, UAE entity which operates a rock crushing and stone quarry

in Ras Al Khaimah, UAE. The ownership interest was increased to approximately 35% in 2007. In

October 2008, WWA Group’s shares of PTP were exchanged for shares of Intelspec International, Inc

(“Intelspec”). The exchange resulted in the WWA Group’s ownership of 32% of Intelspec.  In December

2009, Intelspec raised additional equity financing through issuance of stock thus resulting in a reduction

of WWA Group’s ownership interest to 30%. In April 2010 Intelspec was acquired by Infrastructure,

setting WWA Group’s ownership interest in Infrastructure at 22%. In July 2010, WWA Group sold 4

million shares of Infrastructure at a value of $320,000 reducing WWA Group’s investment to 17.75%.

As of December 31, 2009 WWA Group owned a 30% equity interest in Intelspec International,  Inc.

WWA Group accounted for its interest in Intelspec using the equity method of accounting whereby

WWA Group recorded its proportionate share of the net income or loss attributable to the equity interest.

In April 2010 Intelspec was acquired by Infrastructure, a publicly traded company, which acquisition

reduced WWA Group's equity interest to 24%. In July 2010, WWA Group sold shares of its common

stock in a private transaction, further reducing WWA Group’s ownership interest to 18%.

On November 21, 2011 WWA Group converted its Notes Receivable due from Infrastructure to equity as

a result of which as of December 31, 2011 WWA Group owned  approximately 63% of the common stock

of Infrastructure. Since WWA Group became the majority shareholder of Infrastructure as of November

21, 2011 its financials as of December 31, 2011 and March 31, 2012 were consolidated with those of

WWA Group Inc for reporting purposes.

On June 30, 2012 WWA Group divested itself of 67,509,667 shares of Infrastructure in a series of  debt

settlement agreements, which settlements decreased WWA Group’s equity interest in Infrastructure to

29.62%.

NOTE E – SHORT TERM BORROWINGS AND LINES OF CREDIT

WWA Group has no short term borrowings from unrelated entities as of June 30, 2012

14




WWA GROUP, INC

NOTES TO  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, 2012

NOTE F – STOCK OPTIONS

Under  FASB  Accounting  Standard  Codification  718,  WWA  Group  estimates  the  fair  value  of  each  stock

award  at  the  grant  date  by  using  the  Black-Scholes  option  pricing  model.  There  were  no  grants  of  stock

awards during 2011 and in 2010. WWA Group recorded no expense for 2011 an 2010 for the fair value of

the stock options granted.

The following weighted average assumptions were used for grants made during the year ended December

31, 2008:

Dividend yield of zero percent for all periods; expected volatility of 58.20% and 63.76%; risk-free

interest rates of 2.24% and 3.94% and expected lives of 1.0 and 2.0, respectively.

A summary of the status of WWA Group's stock options as of December 31, 2010 and changes during the

years ended December 31, 2011 and 2010 is presented below:

Weighted

Weighted

Number of

Average

Average

Options

Exercise

Grant Date

Price

Fair Value

Outstanding December 31,

2007

576,973

$ 1.00

$ 0.23

Granted

100,000

$ 0.36

$ 0.17

Expired

-

$ 0.00

$ 0.00

Exercised

-

$ 0.00

$ 0.00

Outstanding December 31,

676,973

$ 0.36

$ 0.17

2008

Exercisable

676,973

$ 0.36

$ 0.17

Granted

-

$ 0.00

$ 0.00

Exercised

-

$ 0.00

$ 0.00

Expired

(676,973)

$ 0.36

$ 0.17

Outstanding December 31,

2009 & 2010 and 2011

-

$ 0.00

$ 0.00

NOTE G – RELATED PARTY TRANSACTIONS

As of June 30, 2012 WWA Group has no related party investments.

15




WWA GROUP, INC

NOTES TO  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

June 30, 2012

NOTE H – COMMITMENTS AND CONTINGENCIES

Contingencies

WWA Group may become or is subject to investigations,  claims or lawsuits ensuing out of the conduct of

its  business.  WWA  Group  is  currently  not  aware  of  any  such  items,  except  those  discussed  below,  which

it believes could have a material effect on its financial position.

NOTE I- CONSOLIDATION AND MINORITY  INTERESTS

As of June 30’ 2012 WWA group has not consolidated the accounts of Infrastructure due to  full

impairment of its equity investment in IDVC.

NOTE J- SUBSEQUENT EVENTS

WWA Group evaluated its June 30, 2012 financial statements for subsequent events through the date

the financial statements were originally issued. Other than the events noted below, WWA Group is

not aware of any subsequent events which would require recognition or disclosure in the financial

statements.

On July 12, 2012 WWA Group enter into a Share Exchange Agreement to acquire all of the issued

and outstanding shares of Summit Digital,  Inc. subject to shareholder approval.

16




I T E M  2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

This Management’s Discussion and Analysis of Financial Condition and Results of Operations and other

parts of this current report contain forward-looking statements that involve risks and uncertainties.

Forward-looking statements can also be identified by words such as “anticipates,” “expects,” “believes,”

“plans,” “predicts,” and similar terms. Forward-looking statements are not guarantees of future

performance and our actual results may differ significantly from the results discussed in the forward-

looking statements. Factors that might cause such differences include but are not limited to those

discussed in the subsection entitled Forward-Looking Statements and Factors That May Affect Future

Results and Financial Condition below. The following discussion should be read in conjunction with our

financial statements and notes thereto included in this current report. Our fiscal year end is December 31.

Discussion and Analysis

The sale of WWA Group’s physical auction business effective October 31, 2010 and ongoing discussions

with OFAC during 2011 as to the possibility that a debilitating penalty might be levied against us

significantly impacted our business operations as of December 31, 2011. Although the uncertainty

associated with OFAC was resolved in January of 2012 and the sale of World Wide eliminated virtually

all of our outstanding liabilities, the resultant loss of income producing activities continues to be

formidable.

Our consolidation with Infrastructure Developments,  Inc. (“Infrastructure’) in November of 2011 on

converting debt to equity did not live up to expectations that the synergies present in the respective

companies would generate the activity necessary to move forward. On June 30, 2012 WWA Group

decreased its equity position in Infrastructure to that of a minority shareholder through a series of debt

settlements intended to relieve WWA Group of outstanding debt obligations. The divestiture of

Infrastructure shares caused us to abandon any consolidation of our accounts with those of Infrastructure

as of June 30, 2012.

We have discontinued efforts to commercialize the operations of Asset Forum, LLC due to the highly

competitive nature of online auction platforms and the limited capital we have available to compete in this

space.

Business

WWA Group’s current operations are focused  around the marketing and sale of “Wing Houses” in North

America, the Middle East and parts of South-East Asia as a distributor pursuant to an agreement with the

Renhe Group. The units are marketed as mobile offices or living space that fold into a standard container

with all ISO fittings in place for easy transport.

Wing Houses can be placed anywhere with a swing lift and opened into 80 square meters of a living or

working environment within four to five hours for a wide range of applications, including

    Living space

    Office space

    On site showrooms

    Restaurants

    Worker accommodation

    Forward operations base.

17




WWA Group owns and operates the www.winghouses.com  web site with the permission of the

manufacturer from which it generates leads. A video of our Wing Houses available on You Tube has in

addition generated more than 15,000 viewings to date. Although WWA Group is yet to conclude a sale of

a Wing House it has generated over one hundred leads since April and documented several quotes.

WWA Group expects to issue formal invoices and realize sales of the Wing Houses in the near future.

Summit Digital, Inc.

On July 12, 2012 the board of directors of WWA Group caused the corporation to enter into a Share

Exchange Agreement to acquire all of the issued and outstanding shares of Summit Digital, Inc.

(“Summit”) from the sole shareholder thereof in exchange for shares of our common stock. The Share

Exchange Agreement (“Agreement”) provides that the sole shareholder of Summit will exchange 100

shares or one hundred percent (100%) of the issued and outstanding shares of Summit for ninety nine

million (99,000,000) shares or eighty percent (80%) of WWA Group. The Agreement further provides for

the appointment of two new members to WWA Group’s board of directors.  Summit is a multi-system

operator that provides cable television, high speed internet and related services to rural communities in

the United States.

Summit is focused on acquiring existing underutilized Cable systems in rural, semi-rural and gated

community markets, aggregating them into a single Multi-System Operator structure and creating growth

by upgrading management, improving efficiency, cutting costs, and fully exploiting the opportunities

presented by bundling multiple services such as basic TV, premium TV, pay-per-view, broadband

Internet, and voice telephony.  These bundled  service packages have become the industry standard in

major urban markets served by major Cable providers, but systems in Summit’s target market typically

lag behind in adopting them, offering a substantial opportunity to increase penetration and per-customer

revenue by offering these comprehensive service packages.  Summit may at times build new Cable

systems or wireless infrastructure to serve areas where no infrastructure is in place, but the primary intent

is to acquire underutilized existing systems.

Summit believes that other value-added services delivered through Cable infrastructure, such as pay-per-

view events, digital video and digital video recording, and high-definition TV also represent significant

potential revenue streams that have not been effectively exploited by its acquisition targets.

Summit intends to take decisive steps to streamline management, improve efficiency, and reduce costs in

systems it acquires using the following areas of emphasis:

    Any debt that is attached to these systems by the prior ownership will be restructured

    Billing, collection, call center and scheduling services will be centralized, significantly reducing

costs for each system.

    Head end technicians located at corporate headquarters will direct employees and monitor their

performance, standardizing and service practices and quality control.

    Theft by potential subscribers who attempt to steal services can have a significant impact on the

viability of rural cable systems.  Measures to prevent theft will be installed, including regular

audits conducted by our own installers as well as independent contractors.

    Equipment purchasing will be combined to achieve economies of scale and reduce costs.

    Structured management systems stressing continuous documentation, performance evaluation,

and action to address weaknesses will be installed, addressing a common management deficiency

in small single-system operators.

18




Many small to medium sized single-system operators of the type common in rural and semi-rural America

have not been developed to their full capacity,  for two primary reasons.

    Many of these systems were overburdened with debt that was incurred on the initial construction

of their cable systems.  Overly optimistic projections and unrealistic performance expectations

not backed up by appropriate technology and management expertise, combined with lack of an

established basis for prediction in many markets led system owners to take on excessive debt,

which enabled their entry to the business but also left them unable to sustain their business

profitably.

    The technology that supports the upgraded services that Summit intends to provide has only

recently become cost-effective for smaller rural systems.  Even with today’s superior and less

expensive technology, small individual cable systems rarely have the economies of scale or the

financing necessary to effectively exploit these technologies.  Summit’s knowledgeable technical

team and ability to combine equipment purchases will provide the knowledge and the leverage

with suppliers that are needed to effectively introduce these technologies.

Summit believes, based on extensive interviews and contacts with management at local systems, that the

managers and owners of many of these systems are interested in acquisition on favorable terms by an

MSO built around the principle of maximizing the potential of these systems. Based on interviews with

small system managers, Summit believes that many of these systems can be acquired in exchange for a

combination of cash and Summit stock.

Once systems have been acquired, Summit will upgrade them to support broadband Internet and voice

telephony and aggressively market these combined services both to existing subscribers and non-

subscribers within the system footprint.  Existing cash flows, cash flows from acquired systems, and

acquisition terms allowing payment as systems are built out.  Summit does not intend to incur debt or sell

shares to finance system upgrades.

Summit intends to add an additional revenue stream to its acquired Cable systems through its capacity to

insert local advertising, known as interstitials, to Cable TV content.  Summit has the right to insert local

advertising into programming from major networks such as CNN, ESPN, Fox News and many others.

This ad insertion is accomplished through an interface between the network and Summit’s system, with

the network providing cue tones that open time slots for Summit’s advertisers.   Again, this is a revenue

opportunity not currently exploited by the Cable systems Summit seeks to acquire, and upgrading systems

to accommodate this form of advertising presents a significant opportunity to generate additional revenue

from existing infrastructure.

Summit’s business strategy is to acquire systems meeting viability criteria, aggregate them in a multiple

system operator format, improve management, reduce costs, and add revenue by aggressively promoting

high-value services such as high speed broadband internet and pay-per-view TV and by adding

advertising income to the system revenue mix.  Summit will not surrender controlling interest in systems

it acquires and will not incur long-term debt to acquire systems or upgrade acquired systems.   Summit

believes that it can substantially increase both its subscriber base and its revenue per subscriber by

following this strategy.

WWA Group expects to conclude the transaction in the third quarter of this year subject to shareholder

approval.

19




Results of Operations

During the six month period ended June 30, 2012, WWA Group (i) abandoned efforts to commercialize

Asset Forum LLC, (ii) decreased its equity interest in Infrastructure to that of a minority shareholder, (iii)

continued to lend management assistance on a temporary basis to World Wide Auctioneers (Dubai); (iv)

increased marketing efforts of Wing House units and (v) satisfied continuous public disclosure

requirements.

Net Income (Loss)

Net income for the three month period ended June 30, 2012 was $145,754 as compared to a net loss of

$393,702 for the three month period ended June 30, 2011. Net income for the six month period ended

June 30, 2012 was $134,807 as compared to a net loss of $2,110,539 for the six month period ended June

30, 2011. The transition to net income in the current three and six month comparative periods can be

attributed to gains on equity investment and other income. WWA Group anticipates that it will continue

to realize net income as general and administrative expenses stabilize and expected revenue from the sale

of Wing Houses is realized.

Revenue

Revenue for the three and six month periods ended June 30, 2012 and June 30, 2011 was $0. WWA

Group expects to realize revenue from the sale of Wing Houses in future periods.

Operating Expenses

Operating expenses for the three month period ended June 30, 2012 are $41,979 as compared to operating

expenses of $8,853 for the three month period ended June 30, 2011. The increase in operating expenses

over the comparative periods is attributed to the professional expenses, director’s fees and expenses

associated with marketing the Wing Houses. WWA Group anticipates that operating expenses will

increase during 2012 as greater effort is made to sell Wing Houses on a global basis.

Depreciation and amortization expenses for the three and six month periods ended June 30, 2012 and June

30, 2011 were $0. Depreciation and amortization expenses are expected to continue to remain at $0

through 2012.

Other Income/Expenses

Other income for the three month period ended June 30, 2012 was $187,733 as compared to other

expense of  $384,850 for the three month period ended June 30, 2011. Other income for the six month

period ended June 30, 2012 was $201,733 as compared to other expense of $2,095,854 for the six month

period ended June 30, 2011. Other income in the current three and six month periods can be attributed to

gains on equity investment, reversal of liabilities and management fees.

Income Tax Expense (Benefit)

WWA Group has a prospective income tax benefit resulting from a net operating loss carry-forward and

start up costs that will offset any future operating profit.

Impact of Inflation

WWA Group believes that inflation has had a negligible effect on operations over the past three years.

20




Liquidity and Capital Resources

We had a working capital surplus of $2,141 as of June 30, 2012. At June 30, 2012, our current assets were

$2,735, which consisted of $2,725 in cash and $10 in other current assets. Our total assets were $2,735.

Our current and total liabilities were $594, which amount consisted of accrued expenses. Our total

stockholders’ equity at June 30, 2012 was $2,141.

Cash flow used in operating activities for the six month period ended June 30, 2012 was $100,110 as

compared to $36,199 for the six month period ended June 30, 2011. The change in cash flow used in

operating activities between the periods can be attributed to the transition to net income, the  gain on

equity investments, prepaid expenses, and other current assets offset by accounts payable and accrued

liabilities. We expect to continue to use cash flows in operating activities for the balance of 2012.

Cash flow provided by investing activities for the six month period ended June 30, 2012 was  $285,497 as

compared to $33,000 for the six month period ended June 30, 2011. Net cash flow provided by investing

activities in the current six month period is attributed to a decrease in the goodwill associated with

Infrastructure and a decrease in a non-controlling interest. We expect to use cash flows in investing

activities going forward  in the event we expand our business.

Cash flow used in financing activities was $231,672 for the six month period ended June 30, 2012 as

compared to cash flow provided by financing activities of $1,169 for the six month period ended June 30,

2011. Cash flow used in financing operations in the current six  month period can be attributed to

payments against short term notes payable offset by debt settlement through the divestiture of equity

investment and debt settlement through the issuance of common stock. We expect to generate cash flows

from financing activities in the near term  to maintain operations.

Our current assets are insufficient to conduct business over the next twelve (12) months. We will have to

seek at least $50,000 in debt or equity financing over the next twelve months to maintain operations and

cannot determine at this time what added amount might be required in the event our shareholders decide

to move forward with the acquisition of Summit.  WWA Group has no current commitments or

arrangements with respect to, or immediate sources of funding. Further, no assurances can be given that

funding is available. Our shareholders are the most likely source of new funding in the form of loans or

equity placements though none have made any commitment for future investment and we  have no

agreement formal or otherwise. Our inability to obtain sufficient funding will have a material adverse

affect on our ability to generate revenue and our ability to continue operations.

WWA Group does not intend to pay cash dividends in the foreseeable future.

WWA Group had no commitments for future capital expenditures that were material at June 30, 2012.

WWA Group has no defined benefit plan or contractual commitment with any of its officers or directors.

WWA Group had no lines of credit or other bank financing arrangements as of June 30, 2012.

WWA Group has no current plans for the purchase or sale of any plant or equipment.

WWA Group has no current plans to make any changes in the number of employees.

21




Off Balance Sheet Arrangements

As of June 30, 2012, WWA Group has no significant off-balance sheet arrangements that have or are

reasonably likely to have a current or future effect on our financial condition, changes in financial

condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources

that is material to stockholders.

Future Financings

We anticipate continuing to rely on debt or equity sales of our shares of common stock in order to

continue to fund our business operations. There is no assurance that we will achieve any additional sales

of our equity securities or arrange for debt or other financing to fund our plan of operations.

Critical Accounting Policies

In Note B to the audited consolidated financial statements for the years ended December 31, 2011 and

2010 included in WWA Group’s Form 10-K, we discuss those accounting policies that are considered to

be significant in determining the results of operations and our financial position. We believe that the

accounting principles utilized by us conform to accounting principles generally accepted in the United

States of America.

The preparation of financial statements requires management to make significant estimates and judgments

that affect the reported amounts of assets, liabilities, revenues and expenses. By their nature,  these

judgments are subject to an inherent degree of uncertainty. On an on-going basis, we evaluate our

estimates, including those related to bad debts, inventories, intangible assets,  warranty obligations,

product liability, revenue, and income taxes. We base our estimates on historical experience and other

facts and circumstances that are believed to be reasonable, and the results form the basis for making

judgments about the carrying value of assets and liabilities.  The actual results may differ from these

estimates under different assumptions or conditions. With respect to revenue recognition, we apply the

following critical accounting policies in the preparation of its financial statements

Forward Looking Statements and Factors That May Affect Future Results and Financial Condition

The statements contained in the section titled  Results of Operations and Description of Business, with the

exception of historical facts, are forward looking statements. A safe-harbor provision may not be

applicable to the forward-looking statements made in this current report. Forward-looking statements

reflect our current expectations and beliefs regarding our future results of operations, performance, and

achievements. These statements are subject to risks and uncertainties and are based upon assumptions and

beliefs that may or may not materialize. These statements include, but are not limited to, statements

concerning:

    our anticipated financial performance;

    the sufficiency of existing capital resources;

    our ability to fund cash requirements for future operations;

    uncertainties related to the growth of our  subsidiaries’ businesses and the acceptance of their

products and services;

    the volatility of the stock market; and

    general economic conditions.

22




We wish to caution readers that our operating results are subject to various risks and uncertainties that

could cause our actual results to differ materially from those discussed or anticipated, including the

factors set forth in the section entitled Risk Factors included elsewhere in this report. We also wish to

advise readers not to place any undue reliance on the forward looking statements contained in this report,

which reflect our beliefs and expectations only as of the date of this report. We assume no obligation to

update or revise these forward-looking statements to reflect new events or circumstances or any changes

in our beliefs or expectations, other than is required by law.

Going Concern

WWA Group’s auditors have expressed an opinion as to its ability to continue as a going concern as a

result of recurring losses from operations.  WWA Group’s ability to continue as a going concern is

subject to its ability to realize a profit from operations and /or obtain funding from outside sources.

Management’s plan to address WWA Group’s ability to continue as a going concern includes obtaining

funding from the private placement of debt or equity and  realizing revenues from additional business

opportunities such as Summit. Management believes that it will be able to obtain funding to  enable WWA

Group to continue as a going concern through the methods discussed above, though there can be no

assurances that such methods will prove successful

Recent Accounting Pronouncements

Please see Note C to our consolidated financial statements for recent accounting pronouncements.

Stock-Based Compensation

We have adopted  Accounting Standards Codification Topic (“ASC”) 718, Share-Based Payment, which

addresses the accounting for stock-based payment transactions in which an enterprise receives employee

services in exchange for (a) equity instruments of the enterprise or (b) liabilities that are based on the fair

value of the enterprise’s equity instruments or that may be settled by the issuance of such equity

instruments.

We account for equity instruments issued in exchange for the receipt of goods or services from other than

employees in accordance with ASC 505. Costs are measured at the estimated fair market value of the

consideration received or the estimated fair value of the equity instruments issued, whichever is more

reliably measurable. The value of equity instruments issued for consideration other than employee

services is determined on the earliest of a performance commitment or completion of performance by the

provider of goods or services.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not required.

23




ITEM 4.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

In connection with the preparation of this annual report, an evaluation was carried out by WWA Group’s

management, with the participation of the chief executive officer and the chief financial officer, of the

effectiveness of  WWA Group’s disclosure controls and procedures (as defined in Rules 13a-15(e) and

15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”)) as of June 30, 2012. Disclosure

controls and procedures are designed to ensure that information required to be disclosed in reports filed or

submitted under the Exchange Act is recorded, processed, summarized, and reported within the time

periods specified in the Commission’s rules and forms, and that such information is accumulated and

communicated to management, including the chief executive officer and the chief financial officer, to

allow timely decisions regarding required disclosures.

Based on that evaluation, WWA Group’s management concluded, as of the end of the period covered by

this report, that WWA Group’s disclosure controls and procedures were not effective in recording,

processing, summarizing, and reporting information required to be disclosed, within the time periods

specified in the Commission’s rules and forms, and such information was not accumulated and

communicated to management, including the chief executive officer and the chief financial officer, to

allow timely decisions regarding required disclosures.

Changes in Internal Controls over Financial Reporting

During the period ended June 30, 2012, there has been no change in internal control over financial

reporting that has materially affected, or is reasonably likely to materially affect our internal control over

financial reporting.

24




PART II – OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS

None.

ITEM 1A.

RISK FACTORS

WWA Group’s operations and securities are subject to a number of risks. Below we have identified and

discussed the material risks that we are likely to face. Should any of the following risks occur, they will

adversely affect our operations, business, financial condition and/or operating results as well as the future

trading price and/or the value of our securities.

Risks Related to WWA Group’s Business

WWA Group has a history of uncertainty about continuing as a going concern.

WWA Group’s audits for the periods ended December 31, 2011 and 2010 expressed substantial doubt as

to its ability to continue as a going concern due to recurring losses from operations. Unless WWA Group

is able to overcome our dependence on successive financings and generate net revenue from operations,

its ability to continue as a going concern will be in jeopardy.

Our chief executive officer does not offer his undivided attention to WWA Group due to his dual

responsibilities.

Our chief executive officer does not offer his undivided attention to our business as he also serves as the

chief executive officer of Asia8, Inc and as a director of Infrastructure Developments Corp. His

responsibilities cause him to divide his time between the three entities. The division of time however does

not necessarily indicate a division of interests since Asia8  is a shareholder of WWA Group and WWA

Group is a shareholder of Infrastructure. Nonetheless, his varied responsibilities may compromise WWA

Group’s ability to successfully conduct its business operations.

WWA Group is dependent upon key personnel.

WWA Group’s performance and operating results are substantially dependent on the continued service

and performance of our officers and directors. We intend to hire additional technical, sales,  managerial

and other personnel as we move forward with our business model. Competition for such personnel is

intense, and there can be no assurance that we  can retain our key employees, or that we will be able to

attract or retain highly qualified personnel in the future. The loss of the services of any of our key

employees or the inability to attract and retain the necessary personnel could have a material adverse

effect upon our business, financial condition, operating results, and cash flows.

Our business is subject to governmental regulations.

International, national and local standards set by governmental regulatory authorities set the regulations

by which products are certified across respective territories.  Further, climate change legislation and

greenhouse gas regulation is becoming increasingly ubiquitous.  The products that we intend  to distribute

are subject to such regulation in addition to national, state and local taxation. Although we believe that we

can successfully distribute our products within current governmental regulations it is possible that

regulatory changes could negatively impact our operations and cause us to diminish or cease operations.

25




Risks Related to WWA Group’s Stock

The market for our stock is limited and our stock price may be volatile.

The market for our common stock has been limited due to low trading volume and the small number of

brokerage firms acting as market makers. Because of the limitations of our market and volatility of the

market price of our stock, investors may face difficulties in selling shares at attractive prices when they

want to. The average daily trading volume for our stock has varied significantly from week to week and

from month to month, and the trading volume often varies widely from day to day.

We incur significant expenses as a result of the Sarbanes-Oxley Act of 2002, which expenses may

continue to negatively impact our financial performance.

We incur significant legal, accounting and other expenses as a result of the Sarbanes-Oxley Act of 2002,

as well as related rules implemented by the Commission, which control the corporate governance

practices of public companies. Compliance with these laws, rules and regulations, including compliance

with Section 404 of the Sarbanes-Oxley Act of 2002, as discussed in the following risk factor, has

substantially increased our expenses, including legal and accounting costs, and made some activities more

time-consuming and costly.

Our internal controls over financial reporting may not be considered effective, which conclusion  could

result in a loss of investor confidence in our financial reports and in turn have an adverse effect on our

stock price.

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 we are required to furnish a report by our

management on our internal controls over financial reporting. Such report must contain, among other

matters, an assessment of the effectiveness of our internal controls over financial reporting as of the end

of the year, including a statement as to whether or not our internal controls over financial reporting are

effective. This assessment must include disclosure of any material weaknesses in our internal controls

over financial reporting identified by management. Since we are unable to continue to assert that our

internal controls are effective, our investors could lose confidence in the accuracy and completeness of

our financial reports, which in turn could cause our stock price to decline.

WWA Group does not pay dividends.

WWA Group does not pay dividends. We have not paid any dividends since inception and have no

intention of paying any dividends in the foreseeable future. Any future dividends would be at the

discretion of our board of directors and would  depend on, among other things, future earnings, our

operating and financial condition, our capital requirements, and general business conditions. Therefore,

shareholders should not expect any type of cash flow from their investment.

WWA Group will require additional capital funding.

WWA Group will require additional funds in the form of additional equity offerings or debt placements,

to maintain operations. Such additional capital may result in dilution to our current shareholders. Further,

our ability to meet short-term and long-term financial commitments will depend on future cash. There can

be no assurance that future income will generate sufficient funds to enable us to meet our financial

commitments.

26




If the market price of our common stock declines as the selling security holders sell their stock, selling

security holders or others may be encouraged to engage in short selling, depressing the market price.

The significant downward pressure on the price of the common stock as the selling security holders sell

material amounts of common stock could encourage short sales by the selling security holders or others.

Short selling is the selling of a security that the seller does not own, or any sale that is completed by the

delivery of a security borrowed by the seller. Short sellers assume that they will be able to buy the stock

at a lower amount than the price at which they sold it short. Significant short selling of a company’s stock

creates an incentive for market participants to  reduce the value of that company’s common stock.  If a

significant market for short selling our common stock develops, the market price of our common stock

could be significantly depressed.

WWA Group’s common stock is currently deemed to be “penny stock”, which makes it more difficult

for investors to sell their shares.

WWA Group’s common stock is and will be subject to the “penny stock” rules adopted under section

15(g) of the Exchange Act. The penny stock rules apply to companies whose common stock is not listed

on the NASDAQ Stock Market or other national securities exchange and trades at less than $5.00 per

share or that have tangible net worth of less than $5,000,000 ($2,000,000 if the company has been

operating for three or more years). These rules require, among other things, that brokers who  trade penny

stock to persons other than “established customers” complete certain documentation, make suitability

inquiries of investors and provide investors with certain information concerning trading in the security,

including a risk disclosure document and quote information under certain circumstances. Many brokers

have decided not to trade penny stocks because of the requirements of the penny stock rules and, as a

result, the number of broker-dealers willing to  act as market makers in such securities is limited. If WWA

Group remains subject to the penny stock rules for any significant period, it could have an adverse effect

on the market, if any, for WWA Group’s securities.  If WWA Group’s securities are subject to the penny

stock rules, investors will find it more difficult to dispose of WWA Group’s securities.

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3.

DEFAULTS ON SENIOR SECURITIES

None.

ITEM 4.

MINE AND SAFETY DISCLOSURES

Not applicable.

ITEM 5.

OTHER INFORMATION

None.

ITEM 6.

EXHIBITS

Exhibits required to be attached by Item 601 of Regulation S-K are listed in the Index to Exhibits on page

29 of this Form 10-Q, and are incorporated herein by this reference.

27




SIGNATURES

Pursuant to the requirements of the Securities Exchange  Act  of 1934, the registrant  has duly caused this report to be

signed on its behalf by the undersigned, thereunto duly authorized.

WWA Group, Inc.

Date

/s/ Eric Montandon

August 16, 2012

By: Eric Montandon

Its: Chief Executive Officer

/s/ Digamber Naswa

August 16, 2012

By: Digamber Naswa

Its: Chief Financial Officer and Principal Accounting Officer

28




INDEX TO EXHIBITS

Exhibit

Description

3.1.1*

Articles of Incorporation of WWA Group (Conceptual Technologies, Inc.) filed with the Nevada

Secretary of State on November 26, 1996 (incorporated herein by reference  from the Form SB-2

filed with the Commission on December 26, 2007).

3.1.2*

Certificate of Amendment of the Articles of Incorporation of WWA Group (Conceptual

Technologies, Inc.)  filed with the Nevada Secretary of State on August  29, 1997 (incorporated

herein by reference  from the Form SB-2 filed with the Commission on December 26, 2007).

3.1.3*

Certificate of Amendment of the Articles of Incorporation of WWA Group (NovaMed Inc.)  filed

with the Nevada Secretary of State on May 8, 1998 (incorporated herein by reference  from the

Form SB-2  filed with the  Commission on December 26, 2007).

3.1.4*

Certificate of Amendment to the Articles of Incorporation of WWA Group filed with the Nevada

Secretary of State on September 25, 2003 (incorporated herein by reference  from the Form SB-2

filed with the Commission on December 26, 2007).

3.2*

Bylaws of WWA Group adopted on November 12, 1996 (incorporated herein by reference  from

the Form SB-2 filed with the Commission on December 26, 2007).

10.1*

Stock Exchange Agreement  between WWA Group and World  Wide Auctioneers, Inc. dated

August  5, 2003 (incorporated herein by reference  from the Form 8-K filed with the Commission

on August  25, 2003).

10.2*

Purchase  Agreement  between World  Wide  Auctioneers, Ltd., Geoffrey Greenless and Crown

Diamond Holdings, Inc. dated June 30, 2006 (incorporated herein by reference  from the Form 8-K

filed with the Commission on July 19, 2006).

10.3*

Share Purchase Agreement  between World Wide Auctioneers, Ltd. and Steven Edward Rogers

dated December 20, 2006 (incorporated herein by reference from the Form 8-K filed with the

Commission on February 15, 2007).

10.4*

Share Purchase Agreement  by and between WWA Group and Seven International Holdings, Ltd.,

dated effective October 31, 2010 (incorporated herein by reference  from the Form 8-K filed with

the Commission on November 12, 2010).

14*

Code of Ethics adopted March 28, 2004 (incorporated herein by reference  from the Form 10-KSB

filed with the Commission on March 30, 2005).

21

Subsidiaries of WWA Group.

23.2*

Consent of Independent  Registered Public  Accounting Firm (incorporated herein by reference

from the Form 10-K filed with the Commission on April 16, 2012)

31.1

Certification of the Chief Executive Officer pursuant to  Rule 13a-14 of the Securities and

Exchange  Act of 1934, as amended, as adopted pursuant  to Section 302 of the Sarbanes-Oxley Act

of 2002.

31.2

Certification of the Chief Financial Officer pursuant to  Rule 13a-14 of the Securities and

Exchange  Act of 1934, as amended, as adopted pursuant  to Section 302 of the Sarbanes-Oxley Act

of 2002.

32.1

Certification of the Chief Executive Officer pursuant to  18 U.S.C. Section 1350 as adopted

pursuant  to Section 906 of the Sarbanes-Oxley Act  of 2002.

32.2

Certification of the Chief Executive Officer pursuant to  18 U.S.C. Section 1350 as adopted

pursuant  to Section 906 of the Sarbanes-Oxley Act  of 2002.

101. INS

XBRL Instance Document

101. PRE

XBRL Taxonomy Extension Presentation Linkbase

101. LAB

XBRL Taxonomy Extension Label Linkbase

101. DEF

XBRL Taxonomy Extension Label Linkbase

101. CAL

XBRL Taxonomy Extension Label Linkbase

101. SCH

XBRL Taxonomy Extension Schema

*

Incorporated by reference  from previous filings of the Company.

Pursuant to  Rule 406T of Regulation S-T, these  interactive data files are deemed  “furnished” and

not “filed” or part of a registration statement or prospectus for purposes of Section 11 or 12 of the

Securities Act of 1933, or deemed  “furnished” and  not  “filed”  for purposes of Section 18 of the

Securities and Exchange  Act  of 1934, and otherwise  is not subject to  liability under these sections.

29



XOTC:WWAG Quarterly Report 10-Q Filling

XOTC:WWAG Stock - Get Quarterly Report SEC Filing of XOTC:WWAG stocks, including company profile, shares outstanding, strategy, business segments, operations, officers, consolidated financial statements, financial notes and ownership information.

XOTC:WWAG Quarterly Report 10-Q Filing - 6/30/2012
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