##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-KSB
 Annual Report Under Section 13 or 15(d) of
the Securities Exchange Act of 1934
 For the Fiscal Year Ended: December 31, 2007
 Commission
File No. 0-50764
 Across America Real Estate Corp.
 (Exact Name of Small Business Issuer as specified in its charter)
 Colorado
    
    20-0003432(State or other jurisdiction
    
    (IRS Employer File Number)of incorporation)700 17thStreet, Suite 1200Denver, Colorado
    
    80202(Address of principal executive offices)
    
    (zip code)
 (303) 893-1003  (Registrants telephone number, including area code)
 None
  Common Stock, $.0.001 per share par value
 o
 þ o
 o
 o þ




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##### 



FORM 10-KSB
 INDEX
 PagePART IItem 1. Description of Business
    
    
    3Item 2. Description of Property
    
    
    13Item 3. Legal Proceedings
    
    
    13Item 4. Submission of Matters to a Vote of Security Holders
    
    
    13PART IIItem 5. Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    13Item 6. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    15Item 7. Financial Statements
    
    
    F-1Item 8. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures
    
    
    19Item 8A. Controls and Procedures
    
    
    19Item 8B. Other Information
    
    
    19PART IIIItem 9. Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) of the Exchange Act
    
    
    19Item 10. Executive Compensation
    
    
    21Item 11. Security Ownership of Certain Beneficial Owners and Management
    
    
    22Item 12. Certain Relationships and Related Transactions
    
    
    23Item 13. Exhibits and Reports on Form 8-K
    
    
    26Item 14. Principal Accountant Fees and Services
    
    
    26Financial Statements pages
    
    
    F-1F-21Signatures
    
    
    27Exhibit 10.26Exhibit 10.27Exhibit 10.28Exhibit 10.29Exhibit 21Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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ITEM 1. DESCRIPTION OF BUSINESS.
             3




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
    
    increase our vulnerability to general adverse economic and industry conditions;
    
    require us to dedicate a substantial portion of our cash flow from operations
to payments on our indebtedness if we do not maintain specified financial
ratios, thereby reducing the availability of our cash flow for other purposes;
or
    
    limit our flexibility in planning for, or reacting to, changes in our business
and the industry in which we operate, thereby placing us at a competitive
disadvantage compared to our competitors that may have less indebtedness.
   4




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
    
    incur additional indebtedness;
    
    make capital expenditures and other investments above a certain level;
    
    merge, consolidate or dispose of our assets or the capital stock or assets of any subsidiary;
    
    pay dividends, make distributions or redeem capital stock in certain circumstances;
    
    enter into transactions with our affiliates;
    
    grant liens on our assets or the assets of our subsidiaries; and
    
    make or repay intercompany loans.
         5




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6




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*
    
    actual or anticipated fluctuations in our operating results;*
    
    change in financial estimates by securities analysts or our failure to perform in line with such estimates;*
    
    changes in market valuations of other real estate oriented companies, particularly those that market services such as ours;*
    
    announcements by us or our competitors of significant innovations, acquisitions, strategic partnerships, joint ventures or capital commitments;*
    
    introduction of technologies or product enhancements that reduce the need for our services;*
    
    the loss of one or more key customers; and*
    
    departures of key personnel.
    7




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NARRATIVE DESCRIPTION OF THE BUSINESS
 General
   Organization
     8




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OPERATIONS
       Funding:
  1)
    
    Equity and Subordinated Debt2)
    
    Senior Debt
  9




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,
 
   10




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MARKETS
  RAW MATERIALS
  CUSTOMERS AND COMPETITION
   11




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BACKLOG
  EMPLOYEES
  PROPRIETARY INFORMATION
  GOVERNMENT REGULATION
    RESEARCH AND DEVELOPMENT
  ENVIRONMENTAL COMPLIANCE
  SUBSEQUENT EVENTS
    12




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HOW TO OBTAIN OUR SEC FILINGS
  th www.acrossamerica.com
 
 ITEM 2. DESCRIPTION OF PROPERTY.
 th
 
 ITEM 3. LEGAL PROCEEDINGS.
  
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
      
 ITEM 5.
    MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
 PRINCIPAL MARKET OR MARKETS
   13




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Closing Bid Price2007
    
    High
    
    
    LowFirst Quarter
    
    $
    5.75
    
    
    $
    1.76Second Quarter
    
    $
    3.00
    
    
    $
    1.60Third Quarter
    
    $
    2.75
    
    
    $
    1.55Fourth Quarter
    
    $
    1.75
    
    
    $
    1.06
 Closing Bid Price2006
    
    High
    
    
    LowFirst Quarter
    
    $
    4.50
    
    
    $
    2.00Second Quarter
    
    $
    3.15
    
    
    $
    2.25Third Quarter
    
    $
    3.25
    
    
    $
    2.00Fourth Quarter
    
    $
    6.15
    
    
    $
    1.50
  APPROXIMATE NUMBER OF HOLDERS OF COMMON STOCK
  DIVIDENDS
  THE SECURITIES ENFORCEMENT AND PENNY STOCK REFORM ACT OF 1990
    
    
    contains a description of the nature and level of risk in the market for penny stocks in
both public offerings and secondary trading;
    
    contains a description of the brokers or dealers duties to the customer and of the rights
and remedies available to the customer with respect to a violation to such duties or other
requirements of the Securities Act of 1934, as amended;
  14




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
    
    contains a brief, clear, narrative description of a dealer market, including bid and
ask prices for penny stocks and the significance of the spread between the bid and ask
price;
    
    contains a toll-free telephone number for inquiries on disciplinary actions;
    
    defines significant terms in the disclosure document or in the conduct of trading penny
stocks; and
    
    contains such other information and is in such form (including language, type, size and
format) as the Securities and Exchange Commission shall require by rule or regulation;
  
    
    the bid and offer quotations for the penny stock;
    
    the compensation of the broker-dealer and its salesperson in the transaction;
    
    the number of shares to which such bid and ask prices apply, or other comparable
information relating to the depth and liquidity of the market for such stock; and
    
    monthly account statements showing the market value of each penny stock held in the
customers account.
  
 ITEM 6.
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    15




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General
  
    
    the overall state of the real estate segment of the economy,
    
    the development status of and demand for our services and products,
    
    economic conditions in our markets,
    
    the timing of expenditures in anticipation of future revenues,
    
    the mix of services and products sold by us,
    
    the introduction of new services and products,
    
    product enhancements by us or our competitors, and
    
    pricing and other competitive conditions.
 Overview and Recent Developments
      16




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Results of Operations
        17




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Liquidity and Capital Resources
      Seasonality
  Critical Accounting Policies
    18




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ITEM 7. FINANCIAL STATEMENTS
 ACROSS AMERICA REAL ESTATE CORP.
 Report of Independent Registered Public Accounting Firm
 
     
  F - 1




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AssetsCash and Equivalents
    
    $
    2,035,620Deposits held by an affiliate (note 5)
    
    
    940,880Accounts Receivable, net
    
    
    2,156,959Property and equipment, net
of accumulated depreciation (note 6)
    
    
    112,918Real estate held for sale (note 3, 15)
    
    
    14,398,602Construction in progress (note 2, 15)
    
    
    2,484,179Land held for development (note 2)
    
    
    5,388,089Deferred tax asset (note 8)
    
    
    1,143,334Current tax asset (note 8)
    
    
    965,498Deposits and prepaids
    
    
    48,451Total assets
    
    $
    29,674,530Liabilities and Shareholders EquityLiabilitiesAccounts payable
    
    $
    262,209Accrued liabilities
    
    
    409,066Dividends payable
    
    
    78,187Senior subordinated note payable, related parties (note 4)
    
    
    7,000,000Senior subordinated revolving note, related parties (note 4)
    
    
    14,169,198Note payable (note 12)
    
    
    5,716,397Capital lease obligations (note 13)
    
    
    7,517Unearned Revenue (note 1)
    
    
    522,841Total liabilities
    
    
    28,165,415Shareholders equity (note 7)Non controlling interest (note 9)
    
    
    4,594Convertible preferred stock, $.10 par value; 1,000,000 shares authorized,
517,000 shares issued and outstanding
    
    
    51,700Common stock, $.001 par value; 50,000,000 shares authorized,
16,036,625 shares issued and outstanding
    
    
    16,037Additional paid-in-capital
    
    
    6,440,398Retained earnings
    
    
    (5,003,614
    )Total shareholders equity
    
    
    1,509,115Total liabilities and shareholders equity
    
    $
    29,674,530
   F-2




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##### Table of Contents



For the Year EndedDecember 31,2007
    
    
    2006Revenue:Sales (note 2)
    
    $
    17,171,469
    
    
    $
    2,783,000Sales, related parties (note 4)
    
    
    
    
    
    
    5,050,000Financing activities
    
    
    109,000
    
    
    
    Rental income
    
    
    232,408
    
    
    
    414,044Management fees
    
    
    362,981
    
    
    
    212,950Total revenue
    
    
    17,875,858
    
    
    
    8,459,994Operating expenses:Cost of sales (note 2)
    
    
    16,053,131
    
    
    
    2,449,266Cost of sales, related parties (note 4)
    
    
    
    
    
    
    4,767,622Impairment loss on real estate (note 15)
    
    
    3,046,196
    
    
    
    Selling, general and administrative (note 16)
    
    
    3,393,436
    
    
    
    1,881,383Total operating expenses
    
    
    22,492,763
    
    
    
    9,098,271Loss from operations
    
    
    (4,616,905
    )
    
    
    (638,277
    )Non-operating expense:Interest income
    
    
    16,592
    
    
    
    13,227Interest expense
    
    
    (742,965
    )
    
    
    (320,309
    )Other income (expense)
    
    
    (1,570
    )
    
    
    (14,307
    )Loss before income taxes
and non controlling interest
    
    
    (5,344,848
    )
    
    
    (959,666
    )Income tax provision (note 8)
    
    
    (1,819,149
    )
    
    
    (316,252
    )Loss before non controlling interest
    
    
    (3,525,699
    )
    
    
    (643,414
    )Non controlling interest in income of
consolidated subsidiaries (note 9)
    
    
    433,360
    
    
    
    92,357Net loss
    
    $
    (3,959,059
    )
    
    $
    (735,771
    )Other comprehensive income
Preferred stock dividends
    
    
    (310,201
    )
    
    
    (79,887
    )Comprehensive loss applicable to common shareholders
    
    $
    (4,269,260
    )
    
    $
    (815,658
    )Basic and diluted loss per common share
    
    $
    (0.27
    )
    
    $
    (0.05
    )Basic and diluted weighted average common shares outstanding
    
    
    16,036,625
    
    
    
    16,036,625
   F-3




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##### Table of Contents



Non
    
    
    Preferred Stock
    
    
    Common Stock
    
    
    Additional
    
    
    Retainedcontrolling
    
    
    
    
    
    
    Par
    
    
    
    
    
    
    Par
    
    
    Paid-in
    
    
    EarningsInterest
    
    
    Shares
    
    
    Value
    
    
    Shares
    
    
    Value
    
    
    Capital
    
    
    (Deficit)
    
    
    TotalBalance at December 31, 2005
    
    $
    (4,503
    )
    
    
    
    
    
    $
    
    
    
    
    16,036,625
    
    
    $
    16,037
    
    
    $
    161,938
    
    
    $
    81,304
    
    
    $
    254,776Non controlling interest at
December 31, 2006
    
    
    21,449
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21,449Profit sharing at December 31, 2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock option compensation expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,372
    
    
    
    
    
    
    
    20,372Issuance of convertible preferred stock
    
    
    
    
    
    
    517,000
    
    
    
    51,700
    
    
    
    
    
    
    
    
    
    
    
    6,131,451
    
    
    
    
    
    
    
    6,183,151Accrued preferred stock dividends paid
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (79,887
    )
    
    
    (79,887
    )Net loss, year ended
December 31, 2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (735,771
    )
    
    
    (735,771
    )Balance at December 31, 2006
    
    
    16,946
    
    
    
    517,000
    
    
    
    51,700
    
    
    
    16,036,625
    
    
    
    16,037
    
    
    
    6,313,761
    
    
    
    (734,354
    )
    
    
    5,664,090Noncontrolling interest at
December 31, 2007
    
    
    (12,352
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12,352
    )Stock option compensation expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    126,637
    
    
    
    
    
    
    
    126,637Accrued preferred stock dividends declared
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (310,201
    )
    
    
    (310,201
    )Net loss, quarter ending
December 31, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,959,059
    )
    
    
    (3,959,059
    )Balance at December 31, 2007
    
    $
    4,594
    
    
    
    517,000
    
    
    $
    51,700
    
    
    
    16,036,625
    
    
    $
    16,037
    
    
    $
    6,440,398
    
    
    $
    (5,003,614
    )
    
    $
    1,509,115
   F-4




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##### Table of Contents



For the Year EndedDecember 31,2007
    
    
    2006Cash flows from operating activities:Net loss
    
    $
    (3,959,059
    )
    
    $
    (735,771
    )Adjustments to reconcile net income to net cash used by operating activities:Depreciation (note 6)
    
    
    36,788
    
    
    
    4,448Impairment of assets (note 15)
    
    
    3,046,196
    
    
    
    Allowance for bad debt (note 1)
    
    
    258,601
    
    
    
    Stock option compensation expense (note 7)
    
    
    126,637
    
    
    
    20,372Changes in operating assets and operating liabilities:Cash restricted to project development
    
    
    
    
    
    
    258,818Construction in progress (note 2)
    
    
    (2,913,063
    )
    
    
    (1,097,728
    )Real estate held for sale (note 3)
    
    
    (11,970,630
    )
    
    
    2,076,049Land held for development (note 2)
    
    
    6,429,119
    
    
    
    (6,822,790
    )Accounts receivable
    
    
    (2,125,129
    )
    
    
    73,795Deposits and prepaids
    
    
    17,879
    
    
    
    (47,471
    )Accounts payable and accrued liabilities
    
    
    356,727
    
    
    
    89,574Income tax assets and liabilities (note 8)
    
    
    (1,812,564
    )
    
    
    (339,301
    )Unearned revenue (note 1)
    
    
    385,173
    
    
    
    137,668Non-controlling interest (note 9)
    
    
    (12,352
    )
    
    
    16,946Indebtedness to related party (note 4)
    
    
    
    
    
    
    754,750Net cash (used in) operating activities
    
    
    (12,135,677
    )
    
    
    (5,610,641
    )Cash flows from investing activities:Cash collections on notes receivable (note 5)
    
    
    1,348,513
    
    
    
    932,260Issuance of notes receivable (note 5)
    
    
    (1,971,670
    )
    
    
    (1,018,424
    )Cash paid for property and equipment (note 6)
    
    
    (63,153
    )
    
    
    (61,812
    )Security deposit
    
    
    
    
    
    
    (10,000
    )Net cash (used in) investing activities
    
    
    (686,310
    )
    
    
    (157,976
    )Cash flows from financing activities:Proceeds from sale of convertible preferred stock
    
    
    
    
    
    
    6,204,000Preferred stock dividends paid
    
    
    (311,900
    )
    
    
    Proceeds from issuance of related party loans (note 4)
    
    
    19,558,482
    
    
    
    5,214,340Repayment of related party loans (note 4)
    
    
    (10,987,381
    )
    
    
    (8,967,864
    )Proceeds from issuance of notes payable (note 12)
    
    
    12,070,849
    
    
    
    8,551,414Repayment of notes payable (note 12)
    
    
    (6,561,581
    )
    
    
    (4,313,893
    )Repayment of lease obligation (note 13)
    
    
    (8,302
    )
    
    
    (2,436
    )Net cash provided by financing activities
    
    
    13,760,167
    
    
    
    6,685,561Net change in cash
    
    
    938,180
    
    
    
    916,944Cash and cash equivalents, beginning of the year
    
    
    1,097,440
    
    
    
    180,496Cash and cash equivalents, end of the year
    
    $
    2,035,620
    
    
    $
    1,097,440Supplemental disclosure of cash flow information:Cash paid during the year for:Income taxes
    
    $
    
    
    
    $
    Interest
    
    $
    273,625
    
    
    $
    1,155,680Supplemental disclosure of non-cash investing and financing activitiesPreferred stock dividends declared but not paid
    
    $
    78,187
    
    
    $
    79,887
   F-5




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##### Table of Contents



1) Nature of Organization and Summary of Significant Accounting Policies
 Organization and Basis of Presentation
  Principles of Consolidation
  Name of Subsidiary Ownership
 Name of Subsidiary
    
    OwnershipCCI Southeast, LLC (CCISE)
    
    
    100.00
    %Riverdale Carwash Lot 3A, LLC (Riverdale)
    
    
    100.00
    %AARD-Cypress Sound, LLC (Cypress Sound)
    
    
    51.00
    %AARD-TSD-CSK Firestone, LLC (Firestone)
    
    
    51.00
    %South Glen Eagles Drive, LLC (West Valley)
    
    
    51.00
    %119th and Ridgeview, LLC (Ridgeview)
    
    
    51.00
    %53rd and Baseline, LLC (Baseline)
    
    
    51.00
    %Hwy 278 and Hwy 170, LLC (Bluffton)
    
    
    51.00
    %State and 130th, LLC (American Fork)
    
    
    51.00
    %Clinton Keith and Hidden Springs, LLC (Murietta)
    
    
    51.00
    %Hwy 46 and Bluffton Pkwy, LLC (Bluffton 46)
    
    
    51.00
    %AARD Bader Family Dollar Flat Shoals, LLC (Flat Shoals)
    
    
    51.00
    %AARD Westminster OP7, LLC (Westminster OP7)
    
    
    51.00
    %Eagle Palm I, LLC (Eagle)
    
    
    51.00
    %AARD Econo Lube Stonegate, LLC (Econo Lube)
    
    
    51.00
    %AARD Bader Family Dollar MLK, LLC (MLK)
    
    
    51.00
    %AARD-Charmar Greeley, LLC (Starbucks)
    
    
    51.00
    %AARD-Charmar Greeley Firestone, LLC
    
    
    51.00
    %AARD 5020 Lloyd Expy, LLC (Evansville)
    
    
    51.00
    %AARD 2245 Main Street, LLC (Plainfield)
    
    
    51.00
    %AARD-Buckeye, LLC (Buckeye)
    
    
    51.00
    %AARD Esterra Mesa 1, LLC (Esterra Mesa 1)
    
    
    51.00
    %AARD Esterra Mesa 2, LLC (Esterra Mesa 2)
    
    
    51.00
    %AARD Esterra Mesa 3, LLC (Esterra Mesa 3)
    
    
    51.00
    %AARD Esterra Mesa 4, LLC (Esterra Mesa 4)
    
    
    51.00
    %AARD MDJ Goddard, LLC (Goddard)
    
    
    51.00
    %AARD Charmar Arlington Boston Pizza, LLC (Charmar Boston Pizza)
    
    
    51.00
    %AARD LECA LSS Lonestar LLC
    
    
    51.00
    %AARD LECA VL1 LLC
    
    
    51.00
    %AARD NOLA St claude LLC
    
    
    51.00
    %AARD ORFL FD Goldenrod LLC
    
    
    51.00
    %AARD SATX CHA LLC
    
    
    51.00
    %AARD JXFL UTC LLC
    
    
    51.00
    %
  F-6




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##### Table of Contents



Use of Estimates
   Cash and Cash Equivalents
  Accounts Receivable
  Property, Equipment and Depreciation
  Construction in Progress, Land Held for Development and Real Estate Held for Sale
    F-7




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##### Table of Contents



Impairment and Disposal of Long-Lived Assets
  Income Taxes
  Revenue Recognition
    Non-controlling Interest in Consolidated Subsidiaries
  Earnings per Common Share
    F-8




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##### Table of Contents



Going Concern
    Stock-Based Incentive Compensation Plans
 Share-Based Payment SFAS 123(R)
 .
   F-9




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##### Table of Contents



Accounting for Stock Issued to Employees
 Recent Accounting Standards
 FIN
48
 (FAS 157)
 2) Current Development Projects
 AARD Evansville
 AARD Stonegate Econolube
  F-10




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##### Table of Contents



AARD NOLA St. Claude
  AARD LECA LSS Lonestar LLC
  (3) Real Estate Held for Sale
 West Valley
  AARD Esterra Mesa 1,2,3 & 4, LLCs
  Bader Family Dollar
  Cypress Sound
   F-11




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##### Table of Contents



American Fork
 th
 Bluffton 46
  AARD Greeley
  AARD ORFL FD Goldenrod LLC
  Buckeye
   F-12




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##### Table of Contents



(4) Related Party Transactions
 GDBA Investments, LLLP
         BOCO Investments, LLC
    F-13




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##### Table of Contents



GDBA
    
    
    BOCOInvestments
    
    
    Investments
    
    
    TotalSenior subordinated notes payable related parties
    
    
    3,500,000
    
    
    
    3,500,000
    
    
    
    7,000,000Revolving Lines of Credit
    
    
    6,226,733
    
    
    
    7,376,733
    
    
    
    13,603,466Accrued Interest
    
    
    274,488
    
    
    
    291,244
    
    
    
    565,732Senior subordinated revolving notes related parties
    
    
    6,501,221
    
    
    
    7,667,977
    
    
    
    14,169,198
   F-14




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##### Table of Contents



(5) Notes Receivable and Development Deposits
  (6) Property and Equipment
  Equipment
    
    $
    23,277Furniture and fixtures
    
    
    17,396Computers and related equipment
    
    
    34,018Software and intangibles
    
    
    81,963$
    156,654less accumulated depreciation
    
    
    (43,736
    )$
    112,918
  (7) Shareholders Equity
 Preferred Stock
  Series A Convertible Preferred Stock
  Common Stock
  Stock Based Compensation
   F-15




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##### Table of Contents



Risk free interest rate
    
    
    4.61
    %Expected life
    
    
    5.0Dividend yield
    
    
    0.00
    %Expected volatility
    
    
    62.69
    %Fair Value
    
    $
    0.94
   Risk free interest rate
    
    
    4.48
    %Expected life
    
    
    5.0Dividend yield
    
    
    0.00
    %Expected volatility
    
    
    86.87
    %Fair Value
    
    $
    1.94
   Risk free interest rate
    
    
    4.54
    %Expected life
    
    
    5.0Dividend yield
    
    
    0.00
    %Expected volatility
    
    
    86.87
    %Fair Value
    
    $
    1.34
    F-16




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##### Table of Contents



Options Outstanding
    
    
    Options ExercisableWeighted
    
    
    Weighted
    
    
    
    
    
    
    
    
    
    
    Weighted
    
    
    WeightedNumber
    
    
    Average
    
    
    Remaining
    
    
    Aggregate
    
    
    
    
    
    
    Average
    
    
    Remaining
    
    
    Aggregateof
    
    
    Exercise
    
    
    Contractual
    
    
    Intrinsic
    
    
    Shares
    
    
    Exercise
    
    
    Contractual
    
    
    IntrinsicOptions
    
    
    Price
    
    
    Term
    
    
    Value
    
    
    Exercisable
    
    
    Price
    
    
    Term
    
    
    ValueBalance at December 31,
2005
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Activity during 2006:Granted
    
    
    385,000
    
    
    
    1.65
    
    
    
    4.9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Expired/Cancelled
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance at December 31,
2006
    
    
    385,000
    
    
    
    1.65
    
    
    
    4.9
    
    
    
    1,732,500
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Activity during 2007:
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Granted
    
    
    70,000
    
    
    
    2.08
    
    
    
    4.2
    
    
    
    
    
    
    
    96,250
    
    
    
    1.65
    
    
    
    3.9
    
    
    
    Expired/Cancelled
    
    
    (26,250
    )
    
    
    1.65
    
    
    
    3.9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance, at December 31,
2007
    
    
    428,750
    
    
    
    1.72
    
    
    
    3.9
    
    
    
    
    
    
    
    96,250
    
    
    
    1.65
    
    
    
    3.9
    
    
    
    
 (8) Income Taxes
  Income tax asset (liability):Current tax asset:Federal
    
    $
    844,384State
    
    
    121,114Total current tax asset
    
    $
    965,498
  Deferred tax assets:Impairment of asset
    
    $
    697,579Partnership income
    
    
    345,265Bad debt
    
    
    100,854Depreciation
    
    
    (364
    )Total deferred tax assets
    
    $
    1,143,334
   Deferred tax benefit (expense):Federal
    
    $
    744,209State
    
    
    109,442Total net deferred tax benefit
    
    $
    853,651Tax at US federal statutory rates
    
    $
    844,384State income taxes, net of federal
    
    
    121,114Change in beginning deferred balance
    
    
    853,651Total income tax benefit
    
    $
    1,819,149
   F-17




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##### Table of Contents



(9) Noncontrolling Interests
  Balance
    
    
    Earnings allocated to
    
    
    Earnings disbursed/accrued for
    
    
    BalanceDecember 31, 2006
    
    
    Noncontrolling Interest
    
    
    Noncontrolling Interest
    
    
    December 31, 2007Cypress
    
    $
    4,594
    
    
    $
    
    
    
    $
    
    
    
    $
    4,5945020 Lloyd
    
    
    
    
    
    
    76,943
    
    
    
    (76,943
    )
    
    
    Bluffton
    
    
    2,502
    
    
    
    
    
    
    
    (2,502
    )
    
    
    Bluffton 46
    
    
    60
    
    
    
    
    
    
    
    (60
    )
    
    
    Laveen
    
    
    298
    
    
    
    
    
    
    
    (298
    )
    
    
    West Valley
    
    
    298
    
    
    
    
    
    
    
    (298
    )
    
    
    American Fork
    
    
    9,194
    
    
    
    
    
    
    
    (9,194
    )
    
    
    OP7
    
    
    
    
    
    
    (100,401
    )
    
    
    100,401
    
    
    
    Rest Mgmt
    
    
    
    
    
    
    (177,747
    )
    
    
    177,747
    
    
    
    MDJ
    
    
    
    
    
    
    (219,803
    )
    
    
    219,803
    
    
    
    Total
    
    $
    16,946
    
    
    $
    (421,008
    )
    
    $
    408,656
    
    
    $
    4,594
 (10) Concentration of Credit Risk for Cash
  (11) Operating Lease Commitments
 Lessee
   December 31,2008
    
    $
    119,664
 (12) Notes Payable
 Vectra Bank Senior Credit Facility:
   F-18




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##### Table of Contents



United Western Bank Senior Credit Facility
    UnitedVectra
    
    
    Western
    
    
    TotalPrincipal
    
    $
    1,981,363
    
    
    $
    3,571,621
    
    
    $
    5,552,984Accrued interest
    
    
    93,303
    
    
    
    70,110
    
    
    
    163,413$
    2,074,665
    
    
    $
    3,641,731
    
    
    $
    5,716,397
 (13) Capital Lease Obligations
    2008
    
    $
    2,7722009
    
    
    2,7722010
    
    
    2,079$
    7,623less imputed interest
    
    
    106$
    7,517
  F-19




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##### Table of Contents



(14) Spin Off of Subsidiaries
  (15) Impairment of Assets
    ImpairmentProperty
    
    Amount
    
    
    Status119th & Ridgeview
    
    $
    898,046
    
    
    SoldBluffton 46
    
    
    127,494
    
    
    Available for saleBluffton 278
    
    
    247,192
    
    
    SoldWest Valley FED X Kinkos
    
    
    442,925
    
    
    Available for saleAmerican Fork
    
    
    154,504
    
    
    Available for saleCypress Sound
    
    
    459,812
    
    
    Available for saleMLK Family Dollar
    
    
    98,994
    
    
    Available for sale2245 Main Street
    
    
    112,292
    
    
    SoldGoldenrod Family Dollar
    
    
    116,799
    
    
    Available for saleGreeley Lot B
    
    
    36,369
    
    
    Available for saleEsterra Mesa
    
    
    351,769
    
    
    Available for sale$
    3,046,196
  F-20




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##### Table of Contents



(16) Selling, General and Administrative Expense
  For the year endedExpense
    
    December
    
    
    DecemberType
    
    2007
    
    
    2006Payroll
    
    $
    1,881,440
    
    
    $
    1,004,431Professional fees
    
    
    385,199
    
    
    
    477,721Other employee expense
    
    
    203,945
    
    
    
    108,836Stock option compensation expense
    
    
    126,637
    
    
    
    20,372Marketing
    
    
    98,258
    
    
    
    66,460Depreciation
    
    
    55,244
    
    
    
    6,215Bad Debt
    
    
    258,601
    
    
    
    0Other
    
    
    384,112
    
    
    
    197,348Total Selling, general and administrative
    
    $
    3,393,436
    
    
    $
    1,881,383
 (17) Subsequent
Event
    F-21




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##### Table of Contents



ITEM 8. DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
  
 ITEM 8A. CONTROLS AND PROCEDURES.
 Managements Annual Report on Internal Control over Financial Reporting
   (1)
    
    Pertain to the maintenance of records that in reasonable detail
accurately and fairly reflect our transactions and dispositions of
assets;(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 are being made only in accordance with authorizations of
our management and directors; and(3)
    
    Provide reasonable assurance regarding prevention or timely detection
of unauthorized acquisition, use or disposition of our assets that
could have a material effect on our financial statements.
   
 ITEM 8B. OTHER INFORMATION.
  
 ITEM 9.
    DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL PERSONS; COMPLIANCE WITH SECTION
16(a) OF THE EXCHANGE ACT.
  NAME
    
    AGE
    
    POSITION HELDPeter Shepard
    
    
    38
    
    
    President and Chief Executive OfficerJames W Creamer III
    
    
    43
    
    
    Vice President, Treasurer and Chief Financial OfficerTerry W Thompson
    
    
    50
    
    
    Senior Vice President and SecretaryG. Brent Backman
    
    
    67
    
    
    DirectorEric Balzer
    
    
    59
    
    
    DirectorJoseph C. Zimlich
    
    
    48
    
    
    Director
    19




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##### Table of Contents



Compliance
with Section 16(a) of the Securities Exchange Act of 1934
    20




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##### Table of Contents



ITEM 10. EXECUTIVE COMPENSATION
  NonqualifiedNon-Equity
    
    
    DeferredStock
    
    
    Option
    
    
    Incentive
    
    
    Compensation
    
    
    All OtherName & Principal Position
    
    
    
    
    

Salary ($)
    
    

Bonus ($)
    
    

Awards ($)
    
    

Awards ($)
    
    

Compensation ($)
    
    

Earnings ($)
    
    

Compensation ($)
    
    
    Total ($)Ann L. Schmitt (1)
    
    
    2007
    
    
    
    235,000
    
    
    
    80,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    315,000Chief Executive Officer
    
    
    2006
    
    
    
    91,733
    
    
    
    
    
    
    
    
    
    
    
    235,820
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    327,553James W. Creamer, III (2)
    
    
    2007
    
    
    
    120,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    120,000Chief Financial Officer
    
    
    2006
    
    
    
    101,667
    
    
    
    
    
    
    
    
    
    
    
    94,328
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    195,9952005
    
    
    
    100,000
    
    
    
    2,855
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    102,855Terry W. Thompson (3)
    
    
    2007
    
    
    
    127,500
    
    
    
    
    
    
    
    
    
    
    
    53,594
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    181,094Senior VP Operations
 (1)
    
    Ms. Schmitt became our President and CEO on August 7, 2006 and receives a salary of $235,000
per year and is eligible for an annual bonus by our Board of Directors. On November 8, 2006,
Ms Schmitt was granted options to purchase 250,000 shares of common stock at $1.65 per share.
The options have a five year term and a vesting schedule of 25% per year over the next four
years. In addition as part of her employment agreement, Ms. Schmitt received an $80,000 bonus
on March 30, 2007. Ms. Schmitt resigned on February 27, 2008(2)
    
    Mr. Creamer, our Vice President, Treasurer and Chief Financial Officer receives a salary of
$120,000 per year and is eligible for an annual bonus by our Board of Directors. On November
8, 2006, Mr. Creamer was granted options to purchase 100,000 shares of common stock at $1.65
per share. The options have a five year term and a vesting schedule of 25% per year over the
next five years.(3)
    
    Mr. Thompson our Senior Vice President of Operations, receives a salary of $170,000 per year
and is eligible for an annual bonus by our Board of Directors. At the time he joined the
Company, Mr. Thompson was also granted options to purchase 40,000 shares of common stock at
$1.90 per share. The options have a five year term and a vesting schedule of 25% per year
over the next five years.     21




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##### Table of Contents



DIRECTOR COMPENSATION
 Non-Equity
    
    
    NonqualifiedDeferredFees Earned or
    
    
    Stock
    
    
    Option
    
    
    Incentive Plan
    
    
    Compensation
    
    
    All OtherPaid in Cash
    
    
    Awards
    
    
    Awards
    
    
    Compensation
    
    
    Earnings
    
    
    Compensation
    
    
    TotalName
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)G. Brent Backman
    
    
    8,000
    
    
    
    
    
    
    
    9,690
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,690Eric Balzer
    
    
    6,500
    
    
    
    
    
    
    
    9,690
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,190Joseph Zimlich
    
    
    8,000
    
    
    
    
    
    
    
    9,690
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,690
 
 ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
  Amount andNature ofBeneficial
    
    
    Percent ofName and Address of Beneficial Owner
    
    Ownership (1)(2)
    
    
    ClassG. Brent Backman (3)
700 Seventeenth Street, Suite 1200
Denver, Colorado 80202
    
    
    10,781,435
    
    
    
    67.2
    %BOCO Investments, LLC (4)
103 West Mountain Ave. 
Fort Collins, Colorado, 80524
    
    
    -0-Sarmat, LLC (5)
103 West Mountain Ave. 
Fort Collins, Colorado, 80524
    
    
    3,291,500
    
    
    
    20.5
    %Ann L. Schmitt (6) 
700 Seventeenth Street, Suite 1200
Denver, Colorado 80202
    
    
    64,110
    
    
    
    0.4
    %James W Creamer III (7) 
700 SeventeenthStreet, Suite 1200
Denver, Colorado 80202
    
    
    50,800
    
    
    
    0.3
    %Joseph Zimlich (8) 
103 West Mountain Ave. 
Fort Collins, Colorado, 80524
    
    
    56,550
    
    
    
    0.4
    %Eric Balzer (9) 
700 Seventeenth Street, Suite 1200
Denver, Colorado 80202
    
    
    225,000
    
    
    
    1.4
    %Terry Thompson (10) 
700 Seventeenth Street, Suite 1200
Denver, Colorado 80202
    
    
    -0-
    
    
    
    0.0
    %All Officers and Directors
    
    
    11,177,895
    
    
    
    70
    %As a Group (six persons)
 (1)
    
    All ownership is beneficial and of record, unless indicated otherwise.(2)
    
    Beneficial owners listed above have sole voting and investment power with
respect to the shares shown, unless otherwise indicated.  22




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##### Table of Contents



(3)
    
    A total 10,781,435 shares are owned of record by GDBA Investments, LLLP, which is controlled by
Mr. Backman. A total of 10,000 shares are owned in the name of adult children of the Mr. Backman,
for which GDBA and Mr. Backman disclaim beneficial ownership. A total of 29,450 shares are owned in
the name of AARD Share Acquisition, LLC., of which GDBA is a member. A total of 80,000 shares are
owned in the name of AARD Share Acquisition, LLC., of which the adult children of Mr. Backman are
members and for which GDBA and Mr. Backman disclaim any beneficial ownership.(4)
    
    On September 28, 2006, GDBA Investments, LLLP and BOCO Investments, LLC each acquired
250,000 shares of Series A Convertible Preferred Stock. Each share of Series A Convertible
Preferred Stock is the equivalent of four common shares for conversion purposes. As a result, GDBA
Investments, LLLP and BOCO Investments, LLC could each receive an additional 1,000,000 common
shares in us upon conversion of the Series A Convertible Preferred Stock, in addition to any
ownership of common shares. These additional shares are not reflected in the total number of common
shares owned by each entity in us in the chart.(5)
    
    A total of 2,090,000 of these shares are owned of record. A total of 1,201,000 shares are
owned in the name of family members of the affiliate of this entity.(6)
    
    The shares are owned in the name of AARD Share Acquisition, LLC., of which Ms. Schmitt is
a member. In addition, Ms. Schmitt has an option to acquire 250,000 shares at a price of $1.65 per
share. A total of 25% of the total option vests each year.(7)
    
    The shares are owned in the name of AARD Share Acquisition, LLC., of which Mr. Creamer is
a member. In addition, Mr. Creamer has an option to acquire 100,000 shares at a price of $1.65 per
share. A total of 25% of the total option vests each year.(8)
    
    The shares are owned in the name of AARD Share Acquisition, LLC., of which Mr. Zimlich is
a member. In addition, Mr. Zimlich owns 17,000 shares of Series A Convertible Preferred Stock. Each
share of Series A Convertible Preferred Stock is the equivalent of four common shares for
conversion purposes. As a result, Mr. Zimlich could each receive an additional 68,000 common shares
in us upon conversion of the Series A Convertible Preferred Stock, in addition to any ownership of
common shares. These additional shares are not reflected in the total number of common shares owned
by each entity in us in the chart. Mr. Zimlich is affiliated with BOCO Investments, LLC. and serves
as its representative to our Board.(9)
    
    A total of 150,000 shares are owned in the name of an affiliated entity. A total of 75,000
shares are owned in the name of Mr. Balzers son. A total of 15,000 shares are owned in the name of
AARD Share Acquisition, LLC., of which Mr. Balzer is a member.(10)
    
    Mr. Thompson has an option to acquire 40,000 shares at a price of $1.90 per share. A
total of 25% of the option vests each year.  
 ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
 GDBA Investments, LLLP
   23




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##### Table of Contents



BOCO Investments, LLC
      24




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##### Table of Contents



,
     25




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##### Table of Contents



ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.
  (a)
    (1)
    
    FINANCIAL STATEMENTS
 (2)
    
    SCHEDULES(3)
    
    EXHIBITS.The following exhibits required by Item 601 to be filed herewith are
incorporated by reference to previously filed documents:
 ExhibitNumber
    
    Description3.1*
    
    Articles of Incorporation3.2*
    
    Bylaws3.3*
    
    Articles of Amendment to Articles of Incorporation10.26
    
    Amendment to
Subordinated Note, GDBA, Dated March 25, 200810.27
    
    Amendment to
Revolving Note, GDBA, Dated March 25, 200810.28
    
    Amendment to
Subordinated Note, BOCO, Dated March 25, 200810.29
    
    Amendment to
Revolving Note, BOCO, Dated March 25, 200821
    
    List of Subsidiaries.31.1
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15(d)-14(a)31.2
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15(d)-14(a)32.1
    
    Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 *
    
    Previously filed(b)
    
    Reports on Form 8-K.
  
 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
    26




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##### Table of Contents



ACROSS AMERICA REAL ESTATE CORP.Dated: MARCH 28, 2008
    By:
    /s/ Peter ShepardPeter ShepardPresident, Chief Executive Officer  Dated: MARCH 28, 2008
    By:
    /s/ James W Creamer IIIJames W Creamer IIITreasurer, Chief Financial OfficerDated: MARCH 28, 2008
    By:
    /s/ Eric BalzerEric BalzerDirectorDated: MARCH 28, 2008
    By:
    /s/ G. Brent BackmanG. Brent BackmanDirectorDated: MARCH 28, 2008
    By:
    /s/ Joseph ZimlichJoseph ZimlichDirector  27




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##### Table of Contents



ExhibitNumber
    
    Description3.1*
    
    Articles of Incorporation3.2*
    
    Bylaws3.3*
    
    Articles of Amendment to Articles of Incorporation10.26
    
    Amendment to
Subordinated Note, GDBA, Dated March 25, 200810.27
    
    Amendment to
Revolving Note, GDBA, Dated March 25, 200810.28
    
    Amendment to
Subordinated Note, BOCO, Dated March 25, 200810.29
    
    Amendment to
Revolving Note, BOCO, Dated March 25, 200821
    
    List of Subsidiaries.31.1
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15(d)-14(a)31.2
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15(d)-14(a)32.1
    
    Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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    Previously filed  28