UNITED STATES
 SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
  FORM 10-K/A
 (Amendment No. 1)
  (Mark One)
  [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
  For the annual period ended September 30, 2009
 OR
  [  ] 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 0-27757
  CASE FINANCIAL, INC.
 (Exact Name of registrant as specified in its charter)
  Delaware

(State or other jurisdiction incorporation or organization)
33-0529299

(I.R.S. Employer Identification No.)
 
 7668 El Camino Real, Ste.104-106, Carlsbad, CA 92009
 (Address of principal executive offices)
  (760) 804-1449
 (Registrant's telephone number, including area code)
  Securities registered under Section 12(b) of the Exchange Act
 Common Stock, $.001 par value
 (Title of class)
  Indicate by check mark if the registrant is a well-know seasoned issuer, as defined in rule 405 of the Securities Act [  ] Yes [X] No
  Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act [  ] Yes [X] No
  Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]
  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 [  ]  No [  ]
 
 Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
 
 Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange
 
 Large accelerated filer  [  ]                                                                                     Accelerated filer  [  ]
 
 Non-accelerated filer [  ] (Do not check if a smaller reporting company)     Smaller reporting company [X]
  As of January 4, 2010 there were 40,685,145 shares of common stock outstanding.
  Cautionary Statement Pursuant to Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995:
  This Annual Report on Form 10-K for the fiscal year ended September 30, 2009 contains "forward-looking statements" within the meaning of the Federal securities laws. These forward-looking statements include, but are not limited to, statements of expectations, beliefs, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. The forward-looking statements in this Annual Report on Form 10-K for the fiscal year ended September 30, 2009 are subject to risks and uncertainties that could cause actual results to differ materially from those results expressed in or implied by the statements contained herein.
  1
  TABLE OF CONTENTS
  PART I
  Item 1    Description of Business
3Item 1a  Risk Factors
4Item 2.   Description of Property
5Item 3.   Legal Proceedings
5Item 4.   Submission of Matters to a Vote of Security Holders
7Item 5.   Market for Registrant’s common Equity and Related Stockholder Matters
7Item 6.   Selected Financial Data
8Item 7.   Management's Discussion and Analysis Financial Condition and Results of Operations
8Item 7a. Quantitative and Qualitative Disclosures About Market Rsk
12Item 8.   Financial Statements and Supplementary Data
14Item 9.   Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
35Item 9a. Controls and Procedures
35Item 10. Directors, and Executive Officers of the Registrant
38Item 11. Executive Compensation
40Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
41Item 13. Certain Relationships and Related Transactions, and Director Independence
42Item 14. Principal Accountant Fees and Services
42Item 15.  Exhibits, Financial Statements Schedules
42Signatures
43
  2
  PART 1
  Item 1.  Description of Business
  General
  This Annual Report (including, but not limited to, the section Management's Discussion and Analysis or Plan of Operation) includes "forward looking statements." All statements other than statements of historical fact made in this Form 10-K are forward-looking. In particular, any statements made in this Form 10-K regarding industry prospects or our future results of operations or financial position are forward-looking statements. Forward-looking statements reflect our current expectations and are inherently uncertain. The forward-looking statements contained herein are subject to a variety of risks and uncertainties, including those discussed above under the heading "Factors That May Affect Future Results" and elsewhere in this Annual Report on Form 10-K that could cause actual results to differ materially from those anticipated by us. Our actual results may differ significantly from our expectations.
  We were originally incorporated as Sheen Minerals, Inc. on August 26, 1983 in British Columbia, Canada. In September 1993, we domesticated under Section 388 of the Delaware General Corporation Law. Since our incorporation, we have been in several different businesses. On March 12, 2002, we entered into a definitive Asset Purchase Agreement (the "Agreement") with Case Financial, Inc., a private California corporation, wherein we purchased certain assets and the entire business operations of Case Financial, Inc. and its wholly owned subsidiary Case Financial Funding, Inc. (hereinafter referred to as "Old CFI"), and Case Financial, LLC (a California Limited Liability Company related through common ownership, and hereinafter referred to as "LLC") (together hereinafter referred to as "Old Case").
  In May 2002, the Company changed its name to Case Financial, Inc. (Case) and changed its fiscal year end to September 30. Case Financial, Inc. and its subsidiaries, Case Financial, LLC, and Case Capital Corporation, which was formed in November 2002, are hereinafter referred to collectively as "Case" or the "Company".
  Overview
  Case's business was to provide pre-settlement and post-settlement litigation funding services to attorneys and plaintiffs involved in personal injury and other contingency litigation, conducted primarily within the California courts (the "Litigation Finance Business"). Case funding services were non-recourse, meaning that the investment principal, success fees and interest are repaid only when the case is settled or favorably adjudicated in court. On September 30, 2005, the Company's Board of Directors approved a resolution declaring that the Company discontinued its Litigation Finance Business.
  The Company intends to seek, investigate and, if such investigation warrants, acquire an interest in business opportunities who or which desire to seek the advantages of an issuer who has complied with the Securities Act of 1934 ("1934 Act"). In any transaction, we will be the surviving entity, and our stockholders will retain a percentage ownership interest in the post-transaction company. We will not restrict our search to any specific business, industry, or geographical location, and may participate in a business venture of virtually any kind or nature. This discussion of the proposed business is purposefully general and is not meant to be restrictive of our virtually unlimited discretion to search for and enter into potential business opportunities. We may seek a business opportunity with entities which have recently commenced operations, or which wish to utilize the public marketplace in order to raise additional capital in order to expand into new products or markets, to develop a new product or service, or for other corporate purposes. We may acquire assets and establish wholly owned subsidiaries in various businesses or acquire existing businesses as subsidiaries. We anticipate that the selection of a business opportunity in which to participate will be complex and extremely risky.
  3
 
 In analyzing prospective business opportunities, we will consider such matters as the available technical, financial and managerial resources; working capital and other financial requirements; history of operations, if any; prospects for the future; nature of present and expected competition; the quality and experience of management services which may be available and the depth of that management; the potential for further research, development or exploration; specific risk factors not now foreseeable but which then may be anticipated to impact our proposed activities; the potential for growth or expansion; the potential for profit; the public recognition of acceptance of products, services or trades; name identification; and other relevant factors.
  Employees
  As of September 30, 2009, the Company has two employees.
   Item 1a. Risk Factors
  We currently have no operating business.
  We currently have no relevant operating business, revenues from operations or assets. Our business plan is to seek a merger or business combination with an operating business. We face all of the risks inherent in the investigation, acquisition, or involvement in a new business opportunity. An investor's purchase of any of our securities must be regarded as placing funds at a high risk in a new or "start-up" venture with all of the unforeseen costs, expenses, problems, and difficulties to which such ventures are subject.
   4
  Item 2. Description of Property
  The Company's current operations do not require that it maintain any significant office space.  As for September 30, 2009 the Company is under no operating lease agreement.  Currently an officer of the Corporation is providing office space at no charge to the Company to meet its business needs.
  Item 3. Legal Proceedings
  On March 25, 2005 a derivative lawsuit was filed by the Canadian Commercial Workers Industry Pension Plan ("CCWIP"), a major stockholder of the Company. The lawsuit was filed in the Court of Chancery of the State of Delaware against former officers and directors of the Company, specifically Eric Alden, a former CEO and CFO and Chairman of the Board, Harvey Bibicoff, a former interim CEO and CFO and director, Lorne Pollock, former Vice President of Underwriting, Secretary and director and Gordon Gregory, a former director alleging that these officers and directors had damaged the Company by (a) engaging in self dealing transactions in breach of their fiduciary duty of loyalty; (b) mismanaging the Company in violation of their oversight duties and duty of care; (c) wasting corporate assets; and (d) making fraudulent misrepresentations which induced the corporate entity to issue shares to these individuals. The Company's Board of Directors has elected to consent to the filing of this complaint. The Company was named as a nominal defendant in this complaint.
  On October 5, 2005, Mr. Gregory, Mr. Pollock, and the Company executed a Settlement and Release Agreement regarding this action pursuant to which:
  ·
Mr. Gregory returned to the Company 750,000 shares of common stock owned or controlled by him and cancelled two promissory notes of the Company totaling $100,000.
  ·
Mr. Pollock returned to the Company 100,000 shares of common stock owned or controlled by him and repaid in cash to the Company $15,160.
  ·
Mr. Pollock and Mr. Gregory were released from further action by the majority stockholder and the Company with respect to the claims made in the derivative lawsuit.
  ·
Mr. Pollock and Mr. Gregory agreed to waive any and all further claims against the Company and the major stockholder.
  The foregoing agreement was approved by the Court of Chancery in the State of Delaware and was consummated in February 2006. .
  On September 1, 2006, the Company reached a settlement agreement with Mr. Bibicoff resolving all current litigation between the Company and this individual. The key terms to this settlement agreement were:
  ·
The cancellation of promissory notes and accrued interest together totaling approximately $875,000 held by this individual.
  ·
The dismissal of this individual from the derivative lawsuit filed in the Delaware Court of Chancery on March 16, 2005.
  ·
The release of each party from any and all claims that could have been asserted by the other party in any of the actions dismissed as a result of this settlement agreement.
  5
  The foregoing agreement was approved by the Court of Chancery in the State of Delaware and was consummated in November 2007.
  Mr. Alden remains the sole defendant in this action, on November 7th 2007, Case Financial assumed the role of plaintiff in the derivative action commenced against Alden in March 2005 by CCWIPP.
  On April 25th 2005, Mr. Alden filed a breach of contract lawsuit against the Company in the Superior Court of the State of Californian for the County of Los Angeles, Case Number BC 332373. This lawsuit had been stayed by the court pending the outcome of the derivative action filed against Mr. Alden.
  On April 12, 2006, Mr. Alden filed another lawsuit against Landmark American Insurance Company and Case Financial, Inc. in the Superior Court of the State of Californian for the County of Los Angeles, Case Number BC 336747 demanding indemnification for costs associated with this derivative action. This lawsuit had been stayed by the court pending the outcome of the derivative action filed against Mr. Alden.
  On April 19, 2006 Mr. Alden filed a wrongful termination lawsuit against the Company in the Superior Court of the State of California, Case Number BC 350929. This lawsuit had been stayed by the court pending the outcome of the derivative action filed against Mr. Alden.
  Mr. Alden has been directed by the court not to file any additional lawsuits against the Company until the derivative action has been resolved.
  On March 6, 2006 a lawsuit was filed in the Circuit Court of the 11th Judicial Circuit for Miami-Dade County Florida, case number 07-06488CA 02 against the Company by a law firm, for unpaid legal bills in the amount of $94,036. On February 14, 2008 the Company entered into a settlement with the above law firm. The settlement states that the Company shall pay the total sum of $72,500 in equal monthly installments of $5,000. In the event of default the Company agreed that the entire amount of $94,036 plus all accrued interest shall be due the law firm. Because of its financial condition, the Company defaulted on this agreement and a judgment against the Company in the amount of $82,802.72 was entered on June 2, 2009.
  On July 3rd, 2008, the company was served with a lawsuit that was filed in the Superior Court of the State of California for the County of Los Angeles, Case Number BC 391485, against the Company by Old CFI, Inc relating to (a) its performance under the service agreement between the Company and Old CFI, Inc and (b) the transfer of the Company's common stock from Old CFI, Inc to the secured creditors of Old CFI, Inc by the CEO of Old CFI, Inc. Pursuant to the service agreement, the Company demanded and the Court granted that issue (a) be resolved through arbitration. The arbitration is ongoing. The Company believes that this lawsuit is completely without merit.
  6
  On February 17, 2009, the Canadian Commercial Workers Industry Pension Plan ("CCWIPP") filed a Complaint in Arbitration, asserting that the Company breached the non-disparagement clause of the November 7, 2007 settlement agreement between CCWIPP and the Company. The Company has counter-claimed based on CWIPP’s breach of the same agreement. The Company believes that it will prevail in arbitration.
  On September 21, 2009, a lawsuit was filed in the Superior Court of the State of California for the County of San Diego, North County, Case Number 37-2009-00038119-CL-UD-NC against the Company by a La Costa Tower, LLC to seek recovery of  $11,625.64, the remaining amount due under the lease at its previous office location.
  Item 4. Submission of Matters to a Vote of Security Holders
  None.
  Item 5. Market for Registrant’s Common Equity and Related Stockholder Matters
  Our Common Stock is traded on the Over the Counter Bulletin Board (the "OTC Bulletin Board") under the symbol "CSEF." The following table sets forth the high and low trade prices of the Common Stock for the quarters indicated as quoted on the OTC Bulletin Board.
  2009
2008HIGH
LOW
HIGH
LOWFirst Quarter
0.09
0.02
0.12
0.04Second Quarter
0.02
0.01
0.30
0.06Third Quarter
0.03
0.02
0.29
0.11Fourth Quarter
0.05
0.01
0.12
0.04
  As of December 31, 2009, there were approximately 426 holders of record of Common Stock.
  We do not anticipate paying cash dividends on the Common Stock in the foreseeable future. The Company currently intends to retain future earnings to finance its operations and fund the growth of its business. Any payment of future dividends will be at the discretion of the Board of Directors and will depend upon, among other things, earnings, financial condition, capital requirements, level of indebtedness, contractual restrictions with respect to the payment of dividends and other factors that the Board of Directors deems relevant.
  Recent Sales of Equity Securities
  On December 31, 2008, the Company issued 250,000 shares of its common stock to Trio Gold Corp as consideration for an extension granted by Trio Gold Corp on an agreement between the Company and Trio Gold Corp. Refer to the Management's Discussion and Analysis or Plan of Operation in this Form 10-K for a discussion on this agreement.
 
 On October 5, 2009, the Company issues 2,000,000 shares of its common stock as a retainer for legal services.
  In October 2009, the Company also settled additional outstanding loans from two of its shareholders totaling $15,000 by allowing them to purchase 1,500,000 shares of the Company’s common stock at a price of $.01 per share.
  In October 2009, the Company borrowed $50,000 from two shareholders ($25,000 from each shareholder). The Company issued 1,000,000 shares of the Company’s common stock to each of the shareholders as consideration for agreeing to make those loans.
  On November 18, 2009, the Company reduced its outstanding loans with Lawrence Schaffer by allowing Mr. Schaffer to purchase 2,500,000 shares of the Company’s common stock at a price of $.01 per share.
  On November 18, 2009, the Company reduced its outstanding loans with Michael Schaffer by allowing Mr. Schaffer to purchase 2,500,000 shares of the Company’s common stock at a price of $.01 per share.
  On November 18, 2009, the Company settled its outstanding loans with Waddy Stephenson by allowing Mr. Stephenson to purchase 1,000,000 shares of the Company’s common stock at a price of $.01 per share.
  7
  Equity Compensation Plan Information
  The company has no equity compensation plan for its employees, officers, or directors.
  Item 6. Selected Financial Data
  None
  Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
  The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes thereto appearing elsewhere herein.
  Case's business was to provide pre-settlement and post-settlement litigation funding services to attorneys and plaintiffs involved in personal injury and other contingency litigation, conducted primarily within the California courts (the "Litigation Finance Business"). Case funding services were non-recourse, meaning that the investment principal, success fees and interest are repaid only when the case is settled or favorably adjudicated in court. On September 30, 2005, the Company's Board of Directors approved a resolution declaring that the Company discontinued its Litigation Finance Business.
  We have recorded on our September 30, 2009 and 2008 Consolidated Balance Sheet all assets and liabilities associated with the Litigation Finance Business as Assets and Liabilities from Discontinued Operations. All revenues and expenses associated with the Litigation Finance Business have been reclassified and the net amount reported on its Consolidated Statement of Operations as Loss from Discontinued Operations.
  On June 2, 2008, the Company entered into an Exploration Agreement with Trio Gold Corp to explore 29 gold claims covering 547 acres (the Rodeo Creek property) located at the north end of the Carlin Trend in Elko County, Nevada. Under the terms of the agreement, Case Financial, Inc. is to provide $4,000,000 in funding over the next three years to explore the 29 claims and to issue 1,000,000 shares of its common stock to Trio Gold Corp during the same time period, to earn a 70 percent undivided interest in these claims.
  On October 3, 2008, the Company received an extension on its funding requirements from Trio Gold Corp.  Under the terms of the extension, the Company issued 250,000 shares of its common stock to Trio Gold Corp. as consideration for this extension.
  Due to the current economic conditions, the Company was unable to raise the capital required to fund the Exploration Agreement with Trio Gold Corp. and on April 17, 2009, pursuant to terms of that agreement, Trip Gold Corp. terminated the Exploration Agreement.
  At this time, Management believes that the Company's operations should be focused on the successful prosecution of the derivative action against its former Chief Executive Officer Eric Alden, and defending against related actions initiated by Mr. Alden against the Company.
  The Company believes that its current cash resources will be inadequate to fund its operations through its fiscal year ended September 30, 2010. In order to continue its operations, the Company anticipates that some form of equity financing and/or a formal or informal restructuring or reorganization will be required.
  8
  Critical Accounting Policies
  Discontinued Operations
  In accordance with SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets", we have determined that we have complied with the provisions of SFAS No. 144 at September 30, 2009 and 2008 with respect to the classification of the operations of the Litigation Finance Business as a discontinued operation. Accordingly, we have accounted for our Litigation Finance Business as a discontinued operation at September 30, 2009 and 2008, and the assets and liabilities of the Litigation Finance Business have been classified accordingly.
  Use of Estimates
  The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the making of certain 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 amounts could differ from those estimates.
  Long-lived Assets
  We review for the impairment of long-lived assets, including the notes receivable from Old CFI, and certain identifiable intangibles, whenever events or changes in circumstances indicate that the carrying amount of any asset may not be recoverable. An impairment loss would be recognized when the estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition is less than the carrying amount. If impairment is indicated, the amount of the loss to be recorded is based on an estimate of the difference between the carrying amount and the fair value of the asset. Fair value is based upon discounted estimated cash flows expected to result from the use of the asset and its eventual disposition and other valuation methods. When a note receivable becomes impaired, interest is no longer accrued and is recognized when received in cash.
  Trends and Uncertainties
  The principal uncertainties we face are access to adequate capital to seek other business opportunities, the ability to collect the outstanding balances pursuant to our portfolio of investments in contracts and loans receivable and the ability to resolve the various litigation matters facing us.
  9
  Results of Operations
  Discontinued Operations
  All revenue and expenses applicable to our Litigation Finance Business have been reported as gain/(losses) from Discontinued Operations in Statement of Operations. The components of gain/(loss) from Discontinued Operations for the years ended September 30, 2009 and September 30, 2008 consist of the following:
  Years Ended2009


2008Revenues

$
39,687


$
306,305Operating expenses


0



0Net income (Loss) from discontinued operations

$
39,687


$
306,305
 
  In the aggregate, the Company had income from discontinued operations of $39,687 compared to an income from Discontinued Operations for 2008 of $306,305. Revenues from the discontinued Litigation Finance Business decreased by $266,618, in the year ended September 30, 2009 over the year ended September 30, 2008 as a result of settlements that occurred in 2008 related to the Company's discontinued operations.
  Operating Expenses
  Operating expenses consist of costs not directly associated with our Litigation Finance Business. For the year ended September 30, 2009, administrative expenses decreased $297,172, or 29%, to $725,231.
  The decrease in operating expenses were due to the following:
  1.
There were no stock option expenses for the year ended September 30, 2009. However, stock option expenses were $405,677 for the year ended September 30, 2008 as the Company had issued stock options to purchase 2,000,000 shares of the Company's common stock at an exercise price of $0.25. Excluding stock option expenses for the year 2008, operating expenses would have increased by $108,506.
  2.
Compared to 2008, Professional Fees increased $140,207 for the year ended September 30, 2009. The significant increase in professional fees is due to an increase in attorney expenses.
  3.
Compared to 2008, General and Administrative expenses decreased $31,551 for the year-end September 30, 2009.
  Interest Expense
  Interest expense was $52,143 for the year ended September 30, 2009 compared with $3,023 for the year ended September 30, 2008, an increase of $49,120.
  10
 
 Gain On Forgiveness of Debt
  Gain on forgiveness of debt consists of valuation and write-off of accounts payable and loans payable. Gain on forgiveness of debt for the years ended September 30, 2009 and 2008 was $0 and $11,780, respectively.
  Non-Cash Finance Expense
  Non-cash finance expenses were S0 for the year ended September 30, 2009 and for the year ended September 30, 2008.
  Liquidity and Capital Resources
  The financial statements for the fiscal year ended September 30, 2009; our independent auditors expressed substantial doubt about our ability to continue as a going concern. We have discontinued our principal business, the Litigation Finance Business. We have incurred net income / (loss) of $(737,688) and $(695,536) during the years ended September 30, 2009 and 2008, respectively. There was an accumulated deficit of $12,296,824 as of September 30, 2009 and total liabilities exceeded total assets by $1,652,946 as of September 30, 2009. These conditions raise substantial doubt about our ability to continue as a going concern and our financial statements do not include any adjustments that might result from the outcome of this uncertainty.
  Operating Activities
  Our balance sheet at September 30, 2009 reflects cash of $1,900 compared to cash of $2,963 at September 30, 2008, a decrease of $1,063.  Net cash used in operating activities was $(100,836) for the year ended September 30, 2009 compared to $(21,672) for the year ended September 30, 2008, an increase in cash used in operating activities of $79,164.
  Investment Activities
  Net cash provided by investing activities for the year ended September 30, 2009 was $0 compared to net cash provided by investing activities of $0 for the year ended September 30, 2008.
  Financing Activities
  Net cash provided by financing activities was $99,773 for the year ended September 30, 2009 as compared to $19,999 for the year ended September 30, 2008 an increase of $79,774.
  11
  Item 7a. Quantitative and Qualitative Disclosures About Market Risk
  Factors That May Affect Future Results
  We are dependent upon our current management.
  We will be heavily dependent upon the skills, talents, and abilities of our management to implement our business plan. Our management may devote limited time to our affairs, which may be inadequate for our business, and may delay the acquisition of any business opportunity considered. Furthermore, management has limited experience in seeking, investigating, and acquiring businesses and will depend upon its limited business knowledge in making decisions regarding our acquisition of a business opportunity. Because investors will not be able to evaluate the merits of possible business acquisitions by us, they should critically assess the information concerning the management.
  We will need additional financing.
  In all likelihood we will need additional funds to take advantage of any available acquisition business opportunity. Even if we were to obtain sufficient funds to acquire an interest in a business opportunity, we may not have sufficient capital to fully exploit the opportunity. Our ultimate success will depend upon our ability to raise additional capital at the time of the acquisition and thereafter. When additional capital may be needed, there can be no assurance that funds will be available from any source or, if available, that they can be obtained on acceptable terms.
  We do not pay dividends.
  We do not intend to pay any dividends. We do not foresee making any cash distributions in the manner of a dividend or otherwise.
  The effects of an acquisition or merger transaction could be dilutive.
  In any reverse merger transaction, for tax reasons and management reasons, the owners of the target company will be issued a large number of shares of common stock, which will dilute the ownership interest of our current stockholders. In addition, at the time of the reverse merger, it will be likely that there will -be additional authorized but unissued shares that may be later issued by the then new management for any purpose without the consent or vote of the stockholders. The acquisition issuance and additional issuances that may occur will dilute the interests of our stockholders after the reverse merger transaction.
  Company common stock is listed on the Over-The-Counter (OTC) Bulletin Board.
  Because the Company's common stock is listed on the OTC Bulletin Board, the liquidity of the common stock is impaired, not only in the number of shares that are bought and sold, but also through delays in the timing of transactions, and limited coverage by security analysts and the news media, if any, of the Company. As a result, prices for shares of the Company's common stock may be lower than might otherwise prevail if the Company's common stock was traded on NASDAQ or a national securities exchange, like the American Stock Exchange.
  12
  Chang G. Park, CPA, Ph. D.
 t 2667 CAMINO DEL RIO SOUTH PLAZA Bt SAN DEIGO t CALIFORNIA 92108-3707t
 t TELEPHONE (858) 722-5953 t FAX (858) 761-0341  t FAX (858) 764-5480
 t E-MAIL changgpark@gmail.comt
 
 
 Report of Independent Registered Public Accounting Firm
 
 
 To the Board of Directors and Stockholders
 Case Financial, Inc.
 
 
 We have audited the accompanying consolidated balance sheets of Case Financial, Inc. and subsidiary (the “Company”) as of September 30, 2009 and 2008, and the related consolidated statements of operations, changes in shareholders’ equity and cash flows for the years ended September 30, 2009 and 2008. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
 
 We conducted our audit in accordance with the 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.  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 consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Case Financial, Inc. and subsidiary as of September 30, 2009 and 2008, and the results of its operation and its cash flows for the years ended September 30, 2009 and 2008 in conformity with U.S. generally accepted accounting principles.
 
 The consolidated financial statements have been prepared assuming that the Company will continue as a going concern.  As discussed in Note 11 to the consolidated financial statements, the Company’s losses from operations raise substantial doubt about its ability to continue as a going concern.  The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
 
 
 /s/Chang G. Park
 CHANG G. PARK, CPA
 
 January 12, 2010
 San Diego, CA. 92108
  13
  
 Item 8. Financial Statements and Supplementary Data
  CASE FINANCIAL, INC. AND SUBSIDIARIESConsolidated Balance SheetsASSETSAs of


As ofSeptember 30,


September 30,2009


2008Current AssetsCash & cash equivalents

$
1,900


$
2,963Prepaid expense


-



41,223Total Current Assets


1,900



44,186Other AssetsDeposits


-



1,453Total Other Assets


-



1,453TOTAL ASSETS

$
1,900


$
45,639LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)Current LiabilitiesAccounts payable and accrued expenses

$
1,156,805


$
757,629Loans payable - related parties


93,041



8,268Notes  payable


405,000



200,000Total Current Liabilities


1,654,846



965,897TOTAL LIABILITIES


1,654,846



965,897Stockholders' Equity (Deficit)Preferred stock, ($.0001 par value, 20,000,000shares authorized; none issued and outstanding.)


-



-Common stock, (par value $.001 per share, 100,000,000shares authorized: 29,185,145 and 28,935,145 shares issued andoutstanding as of September 30, 2009 and 2008, respectively)


29,185



28,935Paid-in capital


10,614,693



10,609,943Accumulated deficit


(12,296,824
)


(11,559,136
)Total Stockholders' Equity (Deficit)


(1,652,946
)


(920,258
)TOTAL LIABILITIES &STOCKHOLDERS' EQUITY (DEFICIT)

$
1,900


$
45,639
  14
  CASE FINANCIAL, INC. AND SUBSIDIARIESConsolidated Statements of Operations (Unaudited)Year Ended


Year EndedSeptember 30,


September 30,2009


2008RevenuesService

$
-


$
-Net Revenue


-



-Operating ExpensesDepreciation


-



149General and administrative


121,412



152,963Salaries


168,000



168,000Stock option expense


-



405,677Professional fees


435,821



295,614Total Operating Expenses


725,231



1,022,403Income (Loss) from operations


(725,252
)


(1,022,403
)Other Income (Expenses)Interest income


-



10,270Interest expense


(52,143
)


(3,023
)Gain on forgiveness of debt


-



11,780Other income


-



1,645Other expense


-



(110
)Total Other income


(52,143
)


20,562Net income (loss) before discontinued operations


(777,374
)


(1,001,841
)Gain (Loss) from discontinued operations


39,687



306,305Net Income (loss)

$
(737,688
)

$
(695,536
)Net Income (Loss) per common share - basic and diluted:From continuing operations

$
(0.03
)

$
(0.03
)From discontinued operations

$
0.00


$
0.01Weighted average number ofcommon shares - basic and diluted


29,123,501



28,655,910
 
 15
 
 CASE FINANCIAL, INC. AND SUBSIDIARIESConsolidated Statements of Changes in Stockholders Equity (Deficit)As of September 30, 2009Common


Common


Additional


Shares To


Treasury


Retained


TotalShares


Stock


Paid-in


Be Issued


Stock


EarningsAmount


Capital








(Deficit)Balance, September 30, 2007


28,535,145


$
28,535


$
10,117,166


$
-


$
-


$
(10,863,600
)

$
(717,899
)Common stock issued in purchase agreement


250,000



250



72,250















72,500Common stock issued for Directors fees


500,000



500



114,500















115,000Cancel stock issued for Direcotors fees


(500,000
)


(500
)


(114,500
)














(115,000
)Stock options










405,677















405,677Common stock issued for cash


150,000



150



14,850















15,000Net Income (loss)






















(695,536
)


(695,536
)Balance, September 30, 2008


28,935,145



28,935



10,609,943



-



-



(11,559,136
)


(920,258
)Common stock issued in purchase agreement


250,000



250



4,750















5,000Net Income (loss)






















(737,688
)


(737,688
)Balance, September 30, 2009


29,185,145


$
29,185


$
10,614,693


$
-


$
-


$
(12,296,824
)

$
(1,652,946
)
 
 16
 
 CASE FINANCIAL, INC. AND SUBSIDIARIESConsolidated Statements of Cash FlowsYear Ended


Year EndedSeptember 30,


September 30,2009


2008CASH FLOWS FROM OPERATING ACTIVITIESGain (Loss) from discontinued operations

$
39,687


$
306,305Gain (Loss) from continuing operations


(777,374
)


(1,001,841
)Net income (loss)


(737,688
)


(695,536
)Adjustments to reconcile net loss to net cashprovided by (used in) operating activities:Common stock for services


5,000



-Amortization


-



37,419Depreciation


-



149Stock options


-



405,677Changes in operating assets and liabilities:(Increase) decrease in prepaid expenses


41,223



75,218(Increase) decrease in deposits


1,453



-Increase (decrease) in accounts payable and accrued expense


589,176



155,401Net cash (used by) continuing operations


(100,836
)


(21,672
)Net cash provided by continuing operations


-



-Net cash (used by) provided by operating activities


(100,836
)


(21,672
)CASH FLOWS FROM INVESTING ACTIVITIESNet cash provided by (used in) investing activities


-



-CASH FLOWS FROM FINANCING ACTIVITIESProceeds from common stock


-



15,000Proceeds from borrowings - related party


84,773



-Proceeds from borrowings


15,000



4,999Net cash provided by (used in) financing activities


99,773



19,999Net increase (decrease) in cash & cash equivalents


(1,063
)


(1,673
)Cash & cash equivalents at beginning of year


2,963



4,636Cash & cash equivalents at end of year

$
1,900


$
2,963SUPPLEMENTAL DISCLOSURES OF CASH FLOWINFORMATION:Interest expense

$
52,143


$
3,023Income taxes paid

$
-


$
-Non-cash investing and financing activitiesIssued common stock for serviceIssued notes payable to redeem accounts payable

$
5,000


$
-$
190,000


$
-
 
 17
  Note 1. - Organization and Basis of Presentation
  The Company was originally incorporated as Sheen Minerals, Inc. on August 26, 1983 in British Columbia, Canada. In September 1993, the Company domesticated under Section 388 of the Delaware General Corporation Law.  On March 12, 2002, the Company entered into a definitive Asset Purchase Agreement (the "Agreement") with Case Financial, Inc., a private California corporation, wherein we purchased certain assets and the entire business operations of Case Financial, Inc. and its wholly owned subsidiary Case Financial Funding, Inc. (hereinafter referred to as "Old CFI"), and Case Financial, LLC (a California Limited Liability Company related through common ownership, and hereinafter referred to as "LLC") (together hereinafter referred to as "Old Case").
  In May 2002, the Company changed its name to Case Financial, Inc. (Case) and changed its fiscal year end to September 30. Case Financial, Inc. and its subsidiaries, Case Financial, LLC, and Case Capital Corporation, which was formed in November 2002, are hereinafter referred to collectively as "Case" or the "Company".
  Overview:
  Case's business was to provide pre-settlement and post-settlement litigation funding services to attorneys and plaintiffs involved in personal injury and other contingency litigation, conducted primarily within the California courts (the "Litigation Finance Business"). Case funding services were non-recourse, meaning that the investment principal, success fees and interest are repaid only when the case is settled or favorably adjudicated in court. On September 30, 2005, the Company's Board of Directors approved a resolution declaring that the Company discontinued its Litigation Finance Business.
  The Company intends to seek, investigate and, if such investigation warrants, acquire an interest in business opportunities who or which desire to seek the advantages of an issuer who has complied with the Securities Act of 1934 ("1934 Act"). In any transaction, we will be the surviving entity, and our stockholders will retain a percentage ownership interest in the post-transaction company. We will not restrict our search to any specific business, industry, or geographical location, and may participate in a business venture of virtually any kind or nature. This discussion of the proposed business is purposefully general and is not meant to be restrictive of our virtually unlimited discretion to search for and enter into potential business opportunities. We may seek a business opportunity with entities which have recently commenced operations, or which wish to utilize the public marketplace in order to raise additional capital in order to expand into new products or markets, to develop a new product or service, or for other corporate purposes. We may acquire assets and establish wholly owned subsidiaries in various businesses or acquire existing businesses as subsidiaries. We anticipate that the selection of a business opportunity in which to participate will be complex and extremely risky.
  18
  Note 1. - Organization and Basis of Presentation - continued
  Overview:
  In analyzing prospective business opportunities, we will consider such matters as the available technical, financial and managerial resources; working capital and other financial requirements; history of operations, if any; prospects for the future; nature of present and expected competition; the quality and experience of management services which may be available and the depth of that management; the potential for further research, development or exploration; specific risk factors not now foreseeable but which then may be anticipated to impact our proposed activities; the potential for growth or expansion; the potential for profit; the public recognition of acceptance of products, services or trades; name identification; and other relevant factors.
  On June 2, 2008, the Company entered into an Exploration Agreement with Trio Gold Corp to explore 29 gold claims covering 547 acres (the Rodeo Creek property) located at the north end of the Carlin Trend in Elko County, Nevada. Under the terms of the agreement, Case Financial, Inc. is to provide $4,000,000 in funding over the next three years to explore the 29 claims and to issue 1,000,000 shares of its common stock to Trio Gold Corp during the same time period, to earn a 70 percent undivided interest in these claims.
  On October 3, 2008, the Company received an extension on its funding requirements from Trio Gold Corp.  Under the terms of the extension, the Company issued 250,000 shares of its common stock to Trio Gold Corp. as consideration for this extension.
  Due to the current economic conditions, the Company was unable to raise the capital required to fund the Exploration Agreement with Trio Gold Corp. and on April 17, 2009, pursuant to terms of that agreement, Trip Gold Corp. terminated the Exploration Agreement.
  19
  Note 2. – Summary of Significant Accounting Policies
  a.  Basis of presentation:
  The accompanying financial statements include the accounts of Case Financial Inc. and its subsidiaries, Case Financial, LLC and Case Capital Corporation. All significant intercompany accounts, transactions and profits have been eliminated upon consolidation and combination.
  In accordance with ASC Topic 205, "Accounting for the Impairment or Disposal of Long -Lived Assets", the Company has determined that it complied with the provisions of ASC Topic 205 at September 30, 2009 and 2008 with respect to the classification of the operations of the Litigation Finance Business as a discontinued operation. Accordingly, the Company has accounted for its Litigation Finance Business as a discontinued operation at September 30, 2009 and 2008.
   Effective this quarter, the Company implemented ASC Topic 855, “Subsequent Events”. This standard establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued. The adoption of ASC topic 855 did not impact the Company’s financial position or results of operations. The Company evaluated all events or transactions that occurred after September 30, 2009 up through January 12, 2010, the date the Company issued these financial statements.  During this period, the Company did not have any material recognizable subsequent events, other than as disclosed in Note 12.
 
  b.  Use of estimates:
  The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain 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 amounts could differ from those estimates. A significant estimate is the allowance for losses on investments in contracts and loans receivable. Because of the inherent uncertainties in estimating the allowance for losses on investments in contracts and loans receivable, it is likely that the Company's estimate of the allowance for losses on investments in contracts and loans receivable will change, as circumstances become better known.
  c.  Cash and cash equivalents:
  The Company considers all liquid investments with a maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents. The Company maintains its cash in bank deposit accounts that may exceed federally insured limits. The Company has not experienced any losses in such accounts.
  20
  Note 2. – Summary of Significant Accounting Policies – continued
  d. Principles of Consolidation:
  The accompanying financial statements include the accounts of Case Financial Inc. and its subsidiaries, Case Financial, LLC and Case Capital Corporation.  All significant intercompany accounts, transactions and profits have been eliminated upon consolidation and combination.
  e. Impairment of Long-Lived Assets:
  Long-lived assets consist primarily of property and equipment.  The recoverability of long-lived assets is evaluated by an analysis of operating results and consideration of other significant events or changes in the business environment.  If impairment exists, the carrying amount of the long-lived assets is reduced to its estimated fair value, less any costs associated with the final settlement.  As of September 30, 2009, management believes there was no impairment of the Company’s long-lived assets.
  f. Property and Equipment:
  Depreciation is computed using accelerated methods based on the estimated useful lives of the assets, generally as follows:
  Computer software                        3 years
  Office furniture and fixtures        5-7 years
  Equipment                                    5 years
  The Company reviews for the impairment of long-lived assets, whenever events or changes in circumstances indicate that the carrying amount of any asset may not be recoverable. An impairment loss would be recognized when the estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition is less than the carrying amount. If impairment is indicated, the amount of the loss to be recorded is based on an estimate of the difference between the carrying amount and the fair value of the asset. Fair value is based upon discounted estimated cash flows expected to result from the use of the asset and its eventual disposition and other valuation methods.
  21
 
 Note 2. – Summary of Significant Accounting Policies - continued
  g. Prepayments and other assets:
  Finders' fees, prepaid interest, and loan fees are included in prepayments and other assets. These assets are amortized on the straight-line method over the term of the related debt and are expensed immediately in the case of demand notes.
  h. Stock-based compensation:
  ASC topic 718 requires that the cost resulting from all share-based transactions be recorded in the financial statements and establishes fair value as the measurement objective for share-based payment transactions with employees and acquired goods or services from non-employees. The Company accounts for stock-based compensation arrangements in accordance with the provisions of SFAS No. 123R "Accounting for Stock-Based Compensation" which establishes a fair value-based method of accounting for stock-based compensation plans. Under SFAS No. 123R, compensation cost is recognized based on the difference, if any, on the date of grant between the fair value of the Company's common stock and the amount the grantee must pay to acquire the stock. The Company uses the Black-Scholes option-pricing model to determine the fair value of each stock option granted.
  i. Deferred taxes on income:
  The Company records deferred taxes on income for transactions that are reported in different years for financial reporting and tax purposes using an asset and liability method whereby assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established against deferred tax assets when the Company is unable to determine it is more likely than not that the deferred tax assets will be realized.
  j. Fair value of financial instruments:
  The carrying value of cash and accrued expenses are measured at cost, which approximates their fair value. The carrying values of loans payable are presented at face value plus accrued interest and dividends through the due date.
  22
  Note 2. – Summary of Significant Accounting Policies - continued
  k. Segment Reporting
  ASC topic 2 Item 6. Management's Discussion and Analysis or Plan of Operation 80, "Disclosure About Segments of an Enterprise and Related Information" requires use of the "management approach" model for segment reporting. The management approach model is based on the way a company's management organizes segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. Currently, ASC topic 280 has no effect on the Company's financial statements as substantially all of the Company's operations are conducted in one industry segment.
  l. Recent Accounting Pronouncements:
  Recent accounting pronouncements that the Company has adopted or that will be required to adopt in the future are summarized below.
  On September 30, 2009, the Company adopted updates issued by the Financial Accounting Standards Board (FASB) to the authoritative hierarchy of GAAP. These changes establish the FASB Accounting Standards CodificationTM (ASC) 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 Consolidated Financial Statements.
  23
 
 Note 2. – Summary of Significant Accounting Policies - continued
  l. Recent Accounting Pronouncements:
  In June 2009, the FASB issued guidance now codified as ASC Topic 105, “Generally Accepted Accounting Principles” (“ASC 105”), which establishes the FASB Accounting Standards Codification as the source of GAAP to be applied to nongovernmental agencies. ASC 105 explicitly recognizes rules and interpretive releases of the SEC under authority of federal securities laws as authoritative GAAP for SEC registrants. ASC 105 became effective for interim or annual periods ending after September 15, 2009. ASC 105 does not have a material impact on the Company’s consolidated financial statements presented hereby.
  In May 2009, the FASB issued guidance now codified as ASC Topic 855, “Subsequent Events” (“ASC 855”). The pronouncement modifies the definition of what qualifies as a subsequent event—those events or transactions that occur following the balance sheet date, but before the financial statements are issued, or are available to be issued—and requires companies to disclose the date through which it has evaluated subsequent events and the basis for determining that date. The Company adopted the provisions of ASC 855 in accordance with the effective date.
  In April 2009, the FASB issued guidance now codified as ASC Topic 825, “Financial Instruments” (“ASC 825”). The pronouncement amends previous ASC 825 guidance to require disclosures about the fair value of financial instruments in all interim as well as annual financial statements. This pronouncement was effective for interim periods ending after June 15, 2009 and the Company adopted its provisions in the second quarter of 2009. There has been no impact to the Company’s consolidated financial statements.
  In April 2008, the FASB issued guidance now codified as ASC Topic 350, “Intangibles—Goodwill and Other” (“ASC 350”). This pronouncement amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under previous ASC 350 guidance, thereby improving the consistency between the useful life of a recognized intangible asset under ASC 350 and the period of expected cash flows used to measure the fair value of the asset under ASC Topic 805, “Business Combinations” (“ASC 805”). This pronouncement was effective for financial statements issued for fiscal years beginning after December 15, 2008 and must be applied prospectively to intangible assets acquired after the effective date. The Company has not acquired any intangible assets since adopting this pronouncement. As such, there has been no impact to the Company’s consolidated financial statements.
  24
  Note 2. – Summary of Significant Accounting Policies - continued
  l. Recent Accounting Pronouncements:
  In March 2008, the FASB issued guidance now codified as ASC Topic 815 “Derivatives and Hedging” (“ASC 815”), which expands the disclosure requirements in previous ASC 815 guidance about an entity’s derivative instruments and hedging activities. This pronouncement’s disclosure provisions apply to all entities with derivative instruments subject to the previous ASC 815 guidance. The provisions also apply to relate hedged items, bifurcated derivatives, and nonderivative instruments that are designated and qualify as hedging instruments. Entities with instruments subject to this pronouncement must provide more robust qualitative disclosures and expanded quantitative disclosures. Such disclosures, as well as existing required disclosures, generally will need to be presented for every annual and interim reporting period. This pronouncement was effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. There has been no impact to the Company’s consolidated financial statements.
  In December 2007, the FASB issued guidance now codified as ASC Topic 805, “Business Combinations” (“ASC 805”), which replaces previous ASC 805 guidance. This pronouncement establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any non-controlling interest in the acquire and the goodwill acquired in connection with a business combination. This pronouncement also establishes disclosure requirements that will enable users to evaluate the nature and financial effect of the business combination. This pronouncement applies prospectively to business combinations for which the acquisition date is on or after the beginning of an entity’s first fiscal year that begins after December 15, 2008. The adoption of this pronouncement did not have a material impact on the Company’s consolidated financial statements.
  Note 3. – Discontinued operations
  The Company has discontinued its Litigation Finance Business.  In accordance with ASC Topic 205, "Accounting for the Impairment or Disposal of Long-Lived Assets", we have determined that we have complied with the provisions of ASC Topic 205 at September 30, 2009 and 2008 with respect to the classification of the operations of the Litigation Finance Business as a discontinued operation.   All remaining assets have either been assigned to the third party investors to collect directly from the attorneys that they advanced funds to, or were part of a settlement.  The Company will continue to account for all Litigation Finance Business as a discontinued operation at September 30, 2009, and the assets and liabilities of the Litigation Finance Business have been classified accordingly.  All revenues and expenses associated with the Litigation Finance Business have been reclassified and the net amount reported on its Consolidated Statement of Operations as Loss from Discontinued Operations.  There was a gain from discontinued operation of $39,687 and $306,305 for the years ended September 30, 2009 and 2008, respectively.
  25
 
 Note 4. - Property and Equipment
  Equipment consisted of the following:
  September 30,2009


2008Computer Software

$
3,240


$
3,240Office furniture and fixtures


3,077



3,077Office Equipment


13,922



13,92220,239



20,239Less: Accumulated depreciation


(20,239
)


(20,239
)$
0


$
0
 
  Note 5. - Notes Payable
  September 30,2009


20081

Notes payable, uncollateralized, interest payable monthly at 12.0% per annum

$
150,000


$
150,0002

Notes payable, uncollateralized, interest payable monthly at 12.0% per annum


50,000



50,0003

Notes payable, uncollateralized, interest payable monthly at 8.0% per annum


10,000



-4

Notes payable, uncollateralized, interest payable monthly at 8.0% per annum


5,000



-5

Notes payable, uncollateralized


190,000



-$
405,000


$
200,000
  26
  Effective January 1, 2003, an accredited investor, through its affiliation with CCWIPP, converted an investment in the Company by exchanging a four year, 9.85% per annum promissory note for a four year, 12% per annum promissory note issued by the Company. The principal amount of the promissory note was $150,000. The Company is in default on this note due to non-payment of interest and principal.
  The principal amount of this promissory note was $50,000. Effective January 1, 2003, the note holder converted their investment in the Company by exchanging  a four-year, 9.85% per annum promissory note for a four year, 12% per annum Promissory note. The Company is in default on this note due to non-payment of interest and principal .
  The principal amount of this promissory note was $10,000. This is an interest- bearing note at 8% per annum. On October 17, 2009, the Company issued 1,000,000 restricted shares of the Company’s Common Stock at $0.01 per unit as the payment of this note, recorded as a $10,000.
  The principal amount of this promissory note was $5,000. This is an interest- bearing note at 8% per annum. On October 17, 2009, the Company issued 500,000 restricted shares of the Company’s Common Stock at $0.01 per unit as the payment of this note, recorded as a $5,000.
  On September 29, 2009, the Company entered into an agreement with a law firm that is currently representing them on ongoing litigation.  The two parties agree that the outstanding legal fees be settled at $190,000.  The agreement stipulates if the Company is award exceeds $1,000,000 then the principal outstanding shall be increased to $210,000.  If the award exceeds $1,500,000 then the principal outstanding shall be increased to $235,000.  The principal amount shall be paid on or before September 29, 2010.
  27
  Note 6. - Related Parties Transactions
  Loan payable
  The related party debt consists of the following:
  September 30,2009


2008Revolving demand loans – officers

$
93,041


$
8,268$
93,041


$
8,268
 
  The Company entered into revolving demand loan agreements with its Chief Executive Officer and Chief Financial Officer.  Pursuant to the terms of these agreements, the Company may borrow, at the discretion of the lender, up to $50,000 from each officer payable on demand with interest at 8%.  The terms of these agreements were amended increasing the amount the Company may borrow from $50,000 to $100,000 at the discretion of the lenders.  As of September 30, 2009 and 2008 , related accrued interest is $5,577 and $ 0.
  On November 18, 2009, the Company issued aggregate of 6,000,000 restricted shares of the Company’s Common Stock at $0.01 per unit as the payment of the loan, recorded as a $60,000, aggregate payment of Revolving demand loans – officers
  Stock Options
  On June 18, 2008, as compensation for serving on the Company's Board of Directors, the Company issued:
  An option to purchase 1,000,000 shares of the Company's common stock at an exercise price of $0.25 to Mr. Michael Schaffer;
  An option to purchase 500,000 shares of the Company's common stock at an exercise price of $0.25 to Mr. Lawrence Schaffer; and
  An option to purchase 500,000 shares of the Company's common stock at an exercise price of $0.25 to Mr. Waddy Stephenson
  28
  Note 6. - Related Parties Transactions - continued
  A summary of the Company’s stock options as of September 30, 2009 and changes during the periods is as follows:
  Year ended September 30, 2009Weighted AverageOptions


Exercise PriceOutstanding at Beginning of Period


-


$
-Granted


2,000,000



0.25Exercised


-



-Expired Unexercised


-



-Outstanding at End of period


2,000,000


$
0.25
 
 
  Stock Options
  Options Outstanding

Options ExercisableExercise prices

Number

Weighted

Weighted

Number

Weighted

WeightedOutstanding
average
average
exercisable
average
averageremaining
exercise

remaining
exercisecontractual
price

contractual
pricelife (years)


life (years)$
0.25

2,000,000

1.71

$
0.25

-

-

$
-2,000,000

1,71


0.25

-

-

$
-
  29
  Note 7. – Contingencies
  Case Financial v. Eric Alden
  On March 25, 2005 a derivative lawsuit was filed by the Canadian Commercial Workers Industry Pension Plan ("CCWIPP"), a major stockholder of the Company. The lawsuit was filed in the Court of Chancery of the State of Delaware against former officers and directors of the Company, specifically Eric Alden, a former CEO and CFO and Chairman of the Board, Harvey Bibicoff, a former interim CEO and CFO and director, Lorne Pollock, former Vice President of Underwriting, Secretary and director and Gordon Gregory, a former director alleging that these officers and directors had damaged the Company by (a) engaging in self dealing transactions in breach of their fiduciary duty of loyalty; (b) mismanaging the Company in violation of their oversight duties and duty of care; (c) wasting corporate assets; and (d) making fraudulent misrepresentations which induced the corporate entity to issue shares to these individuals. The Company's Board of Directors has elected to consent to the filing of this complaint. The Company was named as a nominal defendant in this complaint.
  On October 5, 2005, Mr. Gregory, Mr. Pollock, and the Company executed a Settlement and Release Agreement regarding this action pursuant to which:
  ·     Mr. Gregory returned to the Company 750,000 shares of common stock owned or controlled by him and cancelled two promissory notes of the Company totaling $100,000.
  ·     Mr. Pollock returned to the Company 100,000 shares of common stock owned or controlled by him and repaid in cash to the Company $15,160.
  ·     Mr. Pollock and Mr. Gregory were released from further action by the majority stockholder and the Company with respect to the claims made in the derivative lawsuit.
  ·     Mr. Pollock and Mr. Gregory agreed to waive any and all further claims against the Company and the major stockholder.
  The foregoing agreement was approved by the Court of Chancery in the State of Delaware and was consummated in February 2006. .
  On September 1, 2006, the Company reached a settlement agreement with Mr. Bibicoff resolving all current litigation between the Company and this individual. The key terms to this settlement agreement were:
  ·     The cancellation of promissory notes and accrued interest together totaling approximately $875,000 held by this individual.
  ·     The dismissal of this individual from the derivative lawsuit filed in the Delaware Court of Chancery on March 16, 2005.
  ·     The release of each party from any and all claims that could have been asserted by the other party in any of the actions dismissed as a result of this settlement agreement.
  30
 
 Note 7. – Contingencies – continued
  The foregoing agreement was approved by the Court of Chancery in the State of Delaware and was consummated in November 2007.
  Mr. Alden remains the sole defendant in this action, on November 7th 2007, Case Financial assumed the role of plaintiff in the derivative action commenced against Alden in March 2005 by CCWIPP.
  On April 25th 2005, Mr. Alden filed a breach of contract lawsuit against the Company in the Superior Court of the State of Californian for the County of Los Angeles, Case Number BC 332373. This lawsuit had been stayed by the court pending the outcome of the derivative action filed against Mr. Alden.
  On April 12, 2006, Mr. Alden filed another lawsuit against Landmark American Insurance Company and Case Financial, Inc. in the Superior Court of the State of Californian for the County of Los Angeles, Case Number BC 336747 demanding indemnification for costs associated with this derivative action. This lawsuit is ongoing.
  On April 19, 2006 Mr. Alden filed a wrongful termination lawsuit against the Company in the Superior Court of the State of California, Case Number BC 350929. This lawsuit had been stayed by the court pending the outcome of the derivative action filed against Mr. Alden.
  Mr. Alden has been directed by the court not to file any additional lawsuits against the Company until the derivative action has been resolved.
  
 Case Financial v. Squire Sanders
  On March 6, 2006 a lawsuit was filed in the Circuit Court of the 11th Judicial Circuit for Miami-Dade County Florida, case number 07-06488CA 02 against the Company by a law firm, for unpaid legal bills in the amount of $94,036. On February 14, 2008 the Company entered into a settlement with the above law firm. The settlement states that the Company shall pay the total sum of $72,500 in equal monthly installments of $5,000. In the event of default the Company agreed that the entire amount of $94,036 plus all accrued interest shall be due the law firm. Because of its financial condition, the Company defaulted on this agreement and a judgment against the Company in the amount of $82,802.72 was entered on June 2, 2009. The Company record $82,802.72 as Account Payable as of September 30, 2009.
  31
 
 Note 7. – Contingencies – continued
  Case Financial v. CCWIPP
  On November 5, 2007 the Company entered into a settlement agreement with the Canadian Commercial Workers Industry Pension Plan ("CCWIPP"), resolving a dispute concerning the disposition of funds collected and held in escrow totaling $812,000 and another $160,000 in receivables collected on behalf of CCWIPP and the Company pursuant to a previously entered settlement agreement. The Company and CCWIPP each received $250,000 of these funds. However $50,000 of the Company's funds are to remain in escrow for one year to address potential future costs that may be incurred by CCWIPP in the derivative lawsuit discussed above.  In December 2008 the Company received $35,000 of the $50,000 that remained in escrow.
  On February 17, 2009, the Canadian Commercial Workers Industry Pension Plan ("CCWIPP") filed a Complaint in Arbitration, asserting that the Company breached the non-disparagement clause of the November 7, 2007 settlement agreement between CCWIPP and the Company. The Company has counter-claimed based on CWIPP’s breach of the same agreement. The Company believes that it will prevail in arbitration.
  Case Financial v Old CFI
  On July 3rd, 2008, the company was served with a lawsuit that was filed in the Superior Court of the State of California for the County of Los Angeles, Case Number BC 391485, against the Company by Old CFI, Inc relating to (a) its performance under the service agreement between the Company and Old CFI, Inc and (b) the transfer of the Company's common stock from Old CFI, Inc to the secured creditors of Old CFI, Inc by the CEO of Old CFI, Inc. Pursuant to the service agreement, the Company demanded and the Court granted that issue (a) be resolved through arbitration. The arbitration is ongoing. The Company believes that this lawsuit is completely without merit.
  Case Financial v La Costa Tower
  On September 21, 2009, a lawsuit was filed in the Superior Court of the State of California for the County of San Diego, North County, Case Number 37-2009-00038119-CL-UD-NC against the Company by a La Costa Tower, LLC to seek recovery of  $11,125.64, the remaining amount due under the lease at its previous office location. The Company record $11,125.64 as Accounts Payable as of September 30, 2009.
  Note 8 – Warrants
  At September 30, 2009 year-ended, the Company had zero warrants outstanding.
  32
  Note 9. - Taxes on income
  No provision was made for Federal income tax since the Company has significant net operating loss. As of September 30, 2009, the Company had available net operating loss carryforwards amounting to approximately$11,642,247, that may be applied against future taxable income and that expire in 2029. A substantial portion of this net operating loss carryforwards may be limited due to past and future changes of ownership.
  The Company's total deferred tax asset is as follows:
  September 30,

2009Tax benefit of net operating loss carryforward

$
3,958,364Valuation allowance


(3,958,364
)Net deferred tax asset

$
-
 
  Note 10– Common Stock Transactions
  In June 2008, pursuant to the terms of its exploration agreement with Trio Gold Corp., the Company issued 250,000 shares of the Company’s common stock to Trio Gold Corp.
  On June 18, 2008, as consideration for his agreeing to serve on the Company's Board of Directors, the Company issued 500,000 shares of the Company's common stock to Ike Suri. On August 6, 2008, upon Mr. Ike Suri's resignation from the Company's Board of Directors, the common stock issued to Mr. Ike Suri was returned to the Company and cancelled.
  In June 2008, warrants to purchase 150,000 of the Company’s common stock at a price of $.10 per share were exercised.
  In December 2008, pursuant to the terms of the its exploration agreement extension with Trio Gold Corp., the Company issued 250,000 shares of the Company’s common stock to Trio Gold Corp.
  As of September 30, 2009 the Company has 29,185,145 shares of common stock outstanding.
  33
  Note 11. - Going concern
  The accompanying financial statements contemplate continuation of the Company as a going concern. The Company incurred net income/ (loss) of $($737,688) and $(695,536) during the years ended September 30, 2009 and 2008, respectively. There was an accumulated deficit of $12,296,824, as of September 30, 2009 and total liabilities exceeded total assets by $1,652,946 as of September 30, 2009. The Company has discontinued its primary business activity, the Litigation Finance Business. The Company's current cash is not sufficient to sustain the Company's operations unless the Company is successful at collecting amounts due and owing on its existing investment in contracts and loan receivable portfolios and/or raising additional capital. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
  Note 12. – Subsequent Events
  On October 5, 2009, the Company issues 2,000,000 shares of its common stock as a retainer for legal services.
  In October 2009, the Company also settled additional outstanding loans from two of its shareholders totaling $15,000 by allowing them to purchase 1,500,000 shares of the Company’s common stock at a price of $.01 per share.
  In October 2009, the Company borrowed $50,000 from two shareholders ($25,000 from each shareholder). The Company issued 2,000,000 shares of the Company’s common stock to the shareholders as consideration for agreeing to make those loans.
  On November 18, 2009, the Company reduced its outstanding loan$25,000 with Lawrence Schaffer by allowing Mr. Schaffer to purchase 2,500,000 shares of the Company’s common stock at a price of $.01 per share.
  On November 18, 2009, the Company reduced its outstanding loan $25,000 with Michael Schaffer by allowing Mr. Schaffer to purchase 2,500,000 shares of the Company’s common stock at a price of $.01 per share.
  On November 18, 2009, the Company settled its outstanding loan $10,000 with Waddy Stephenson by allowing Mr. Stephenson to purchase 1,000,000 shares of the Company’s common stock at a price of $.01 per share.
  34
  ITEM 9.  Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
  None.
  ITEM 9A.  CONTROLS AND PROCEDURES
  When we originally filed this Form 10-KSB, the Company inadvertently did not include the management’s conclusions on the effectiveness of the Company’s disclosure controls and the Company’s internal controls over financial reporting as required by Item 307 of Regulation S-K and by Item 308T of Regulation S-K, respectively.
  This omission has been corrected in this amended filing.
  Management's Annual Report on Internal Control over Financial Reporting
 Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, the company's principal executive and principal financial officers and effected by the company's board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that:
 
 -
Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;
 -
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and
 -
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements.
  Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.
  35
 
 As of the year ended September 30, 2009 management assessed the effectiveness of our internal control over financial reporting. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework. Management’s assessment included an evaluation of the design of our internal control over financial reporting and testing of the operational effectiveness of these controls.
 
 The matters involving internal controls and procedures that our management considered to be material weaknesses were:
  (1)
The lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures;
  (2)
Inadequate segregation of duties consistent with control objectives; and
  (3)
Ineffective controls over period end financial disclosure and reporting processes.
  The aforementioned material weaknesses were identified by our Chief Executive Officer in connection with the review of our financial statements as of the year ended September 30, 2009.
  Management's Remediation Initiatives to Address These Material Weaknesses
 In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:
  (1)
We will create a position to segregate duties consistent with control objectives and will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to us.
  (2)
We plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us.
  Conclusions based on the Annual Report on Internal Control over Financial Reporting
 Effective disclosure controls and procedures means that the material information required to be included in the Company’s Securities and Exchange Commission reports is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and regulations for the period of time covered by this report.
  36
 
 Effective internal controls for financial reporting means that policies and procedures are in place that provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the registrant; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the registrant are being made only in accordance with authorizations of management and directors of the registrant; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the registrant's assets that could have a material effect on the financial statements.
  As a result of its assessment and the material weaknesses identified above, management has concluded that our internal controls for financial reporting as of the end of the period covered by this report were not effective. Additionally, due to the ineffectiveness of its internal controls for financial reporting, management has also concluded that its disclosure controls are not effective either.
  Although, Management believes that these material weaknesses set forth above did not result in any material misstatement in this report, the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.
  Changes in Internal Control over Financial Reporting
 There were no changes in our internal control over financial reporting during the fiscal year ended September 30, 2009, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
  No Attestation as to the Annual Report on Internal Control over Financial Reporting
 This annual report does not include an attestation report of the Corporation's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Corporation's registered public accounting firm pursuant to temporary rules of the SEC that permit the Corporation to provide only the management's report in this annual report.
  37
  Item 10. Directors, and Executive Officers of the Registrant.
  The following are the directors and officers as of September 30, 2009.
  Name
Position
AgeMichael Schaffer
Chairman of the Board, Chief Executive Officer
67Lawrence Schaffer
Director, President, Chief Financial Officer
41Waddy Stephenson
Director, Corporate Secretary
49
 
  Michael A. Schaffer had served as Chairman of the Board and Chief Executive Officer of the Company from April 1994 to March 2002. Since 1975, Mr. Schaffer has been a private investor. In addition, Mr. Schaffer received a Bachelor of Arts degree from Hunter College and a Jurist Doctorate from Brooklyn Law School. Mr. Schaffer was admitted to the practice of law in the State of New York in 1967 and practiced law through 1974. Mr. Schaffer is also a shareholder of the Company.
  Lawrence C. Schaffer had served as President and a Director of the Company from June 1994 to May 2002. In addition, Mr. Schaffer has ten years of experience in administration and marketing for several small-cap public companies. Mr. Schaffer received a Bachelor of Arts degree from the University of Arizona in 1991. Mr. Schaffer is also a shareholder of the Company.
  Waddy Stephenson had served as Director and Vice President of the Company March 1999 to May 2002. Mr. Stephenson is also a shareholder of the Company. Mr. Stephenson has over 20 years experience in the development and management of computer software. Mr. Stephenson received a Bachelor of Science from the University of North Florida in 1986.
  Audit Committee Financial Expert
  The Company's Board of Directors has not established a separate audit committee within the meaning of Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Instead, the entire Board of Directors acts as the audit committee within the meaning of Section 3(a)(58)(B) of the Exchange Act. In addition, no director on the Company's Board of Directors currently meets the definition of an "audit committee financial expert" within the meaning of Item 401(e) of Regulation SB. The Company is currently seeking candidates for outside directors and for a financial expert to serve on a separate audit committee when we establish one. Due to the Company's small size and limited resources, it has been difficult to recruit outside directors and financial experts, especially due to the fact that we do not have directors and officer's liability insurance to offer suitable candidates.
  38
  Compliance with Section 16(a) of the Act
  The members of the Board of Directors, certain executive officers of the Company and persons who hold more than 10% of the Company's outstanding common stock are subject to the reporting requirements of Section 16(a) of the Exchange Act which require them to file reports with respect to their ownership of common stock and their transactions in common stock. Based upon the copies of Section 16(a) reports that the Company received from such persons for their 2009 fiscal year transactions in the common stock and their common stock holdings, the Company believes that the reporting requirements under Section 16(a) for such fiscal year were not met in a timely manner by certain of its executive officers, Board members and greater than ten-percent stockholders. The following schedule contains the required information for the last fiscal year:
  Number of Late Reports
Number of Late Transactions Not Reported on Time
Number of Failures to FileMichael Schaffer
0
0
0Lawrence Schaffer
0
0
0Waddy Stephenson
0
0
0Sam Schwartz
0
0
0
  Code of Ethics
  We have not adopted a code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. We are in the process of reviewing a code of ethics with our attorneys and the independent board members and will adopt one upon completion of discussions.
   39
  Item 11. Executive Compensation
  The following Summary Compensation Table sets forth the accrued compensation earned by the Company's Chief Executive Officer and Chief Financial Officer for the year ended September 30, 2009.
  Name
Salary
BonusMichael Schaffer, CEO
99,000
$0.00       (1)Lawrence Schaffer, CFO
84,000
$0.00       (2)
 
  (1) Includes an auto allowance of $9,000.
  (2) Includes an auto allowance of $6,000.
  Option Grants in Last Fiscal Year
  None
  Aggregated Options Exercised in Last Fiscal Year and Year End Option Holdings
  None
  Employment Agreements
  As of September 30, 2009 there were no employment agreements with any current employees.
  Compensation of Directors
  None
  40
  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 beneficial ownership of the outstanding shares of common stock of the Registrant by the Registrant's directors, executive officers and each person known by the Registrant to own in excess of 5% of the outstanding shares of common stock of the Registrant, and the directors and executive officers as a group. Unless otherwise specified, the address of all listed persons is 7668 El Camino Real, Ste.104-106, Carlsbad, CA 92009. Beneficial ownership is determined in accordance with the SEC Rule 13d-3 and generally includes shares over which the holder has voting or investment power, subject to community property laws. All shares of common stock obtainable upon conversion of securities or exercise of stock options or warrants (including those that are not currently exercisable but will become exercisable within 60 days hereafter) are considered to be beneficially owned by the person holding the options or warrants for computing that person's percentage, but are not treated as outstanding for computing the percentage of any other person. Unless otherwise specified, each person below has personal and sole beneficial ownership of the shares of common stock:
  Name of Beneficial
Total
%Michael Schaffer
5,206,015
12.5% (1)Lawrence Schaffer
4,562,850
11.1% (2)Waddy Stephenson
2,246,300
5.5% (3)Directors and Executive Officers as a group (3 persons)
12,015,165
28.1% (4)Sam Schwartz

16032 Valley Meadow Place

Encino, CA 91436
4,767,300
11.7%
 
  This table was calculated using the number of shares outstanding as of December 31, 2009, which were 40,685,145.
  (1)
This entry includes the option to purchase 1,000,000 shares of the Company's common stock at an exercise price of $0.25 granted to Michael Schaffer on June 18, 2008. This option expires on June 17, 2011.
  (2)
This entry includes the option to purchase 500,000 shares of the Company's common stock at an exercise price of $0.25 granted to Lawrence Schaffer on June 18, 2008. This option expires on June 17, 2011.
  (3)
This entry includes the option to purchase 500,000 shares of the Company's common stock at an exercise price of $0.25 granted to Waddy Stephenson on June 18, 2008. This option expires on June 17, 2011.
  (4)
This entry includes the options to purchase 2,000,000 shares of the Company's common stock detailed in notes 1-3 above.
  41
  Item 13. Certain Relationships and Related Transactions, and Director Independence
  In October 2005, the Company entered into revolving demand loan agreements with Michael Schaffer, its Chief Executive Officer and Lawrence Schaffer, its Chief Financial Officer. Pursuant to the terms of these agreements, the Company may borrow, at the discretion of the lender, up to $50,000 from each officer payable on demand with interest at 8.0%.  The terms of these agreements were amended increasing the amount the Company may borrow from $50,000 to $100,000 at the discretion of the lenders.
  In October 2007, the Company entered into revolving demand loan agreements with Waddy Stephenson, a director and the Corporate Secretary. Pursuant to the terms of these agreements, the Company may borrow, at the discretion of the lender, up to $50,000 payable on demand with interest at 8.0%.
 
 As of September 30, 2009, the total amount owed on these notes was $93,041.
  Item 14. Principal Accountant Fees and Services.
  Audit Fees
  The approximate aggregate fees billed for each of the last two fiscal years for professional services rendered by Chang G. Park, CPA for the audit of the Registrant's annual financial statements, and review of financial statements included in the company's SEC filings is as follows: 2009: $21,000; and 2008: $29,000.
  Audit-Related Fees
  The aggregate fees billed in each of the last two fiscal years for assurance and related services by Chang G. Park, CPA that are reasonably related to the performance of the audit or review of the Registrant's financial statements and are not reported under Audit Fees above: $0.
  Tax Fees
  The aggregate fees billed in each of the last two fiscal years for professional services rendered by Chang G. Park, CPA for tax compliance, tax advice, and tax planning is as follows: 2009: $0 and 2008: $0.
  All Other Fees
  The aggregate fees billed in each of the last two fiscal years for products and services provided by Chang G. Park, CPA other than the services reported above: $0.
  The Company's Board of Directors serves as the Audit Committee and has unanimously approved all audit and non-audit services provided by the independent auditors. The independent accountants and management are required to periodically report to the Board of Directors regarding the extent of services provided by the independent accountants, and the fees for the services performed to date. There have been no non-audit services provided by our independent accountant in 2009.
  Item 15. Exhibits and Reports
  (a) Exhibits. The exhibits listed on the attached Exhibit Index are filed as part of this report.
  42
  SIGNATURES




In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.




Case Financial, Inc.
/s/ Michael SchafferJune 18, 2010
Michael SchafferChief Executive Officer







In accordance with the Exchange Act, this report has been signed below by the following persons in the capacities and on the dates indicated.




Signature

Title
Date/s/ Michael Schaffer

Chairman of the Board of
June 18, 2010Michael Schaffer

Directors, Chief Executive Officer/s/ Lawrence Schaffer

Director, President, Chief
June 18, 2010Lawrence Schaffer

Financial Officer/s/ Waddy Stephenson

Director, Corporate Secretary
June 18, 2010Waddy Stephenson
















43




EXHIBIT INDEX




31.1
Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.




31.2
Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.




32
Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002