Independent Film Development 10K 2010 Annual report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

[X]	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the fiscal year endedSeptember 30, 2010
	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934

For the transition period from _____________ to _____________

Commission file number:814-00758

INDEPENDENT FILM DEVELOPMENT CORPORATION

(Exact name of registrant as specified in its charter)

Nevada		56-2676759
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

6399 Wilshire Blvd., Suite 507 Los Angeles, California		90048
(Address of principal executive offices)		Zip Code)

Registrant’s telephone number, including area code(323) 782-0602

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Name of each exchange on which registered

None

Securities registered pursuant to Section 12(g) of the Act:

Common stock, $0.0001 par value

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes £ No T

Indicated by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. Yes £ No T

Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934during 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.

X Yes No

Indicate by checkmark if disclosure of delinquent filers pursuant to item 405 of Regulation S-K(section 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 incorporate by reference in Part III of this From 10-K or any amendment to this Form 10-K. _____

Indicate by checkmark wither 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 Act.

Large accelerated filer ____

Accelerated filer ____

Non-accelerated filer ___ (Do not check if a smaller reporting company)

Smaller reporting company X

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

Yes T No£

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter was: $0.00

The number of shares outstanding of each of the registrant’s classes of common stock, as of February 9, 2011 was 22,793,420 shares.

PART I

Item 1. BUSINESS

Business Development

Independent Film Development Corporation was incorporated in Nevada on September 14, 2007. The Company's fiscal year ends on September 30. Effective April 24, 2008 we commenced operating as a Business Development Company ("BDC") under Section 54(a) of the Investment Company Act of 1940 ("1940 Act"). On September 30, 2009, our board of directors elected to cease operating as a BDC.

Our current plan of operations is to acquire and develop independent films for production, sales and distribution, with a goal toward significant partnerships with mini-major and the major film studios, such as Lionsgate and Sony, while simultaneously emulating those companies’ recipes for success.

FORWARD LOOKING STATEMENTS

This report contains forward-looking statements. The Company’s expectation of results and other forward-looking statements contained in this registration statement involve a number of risks and uncertainties. Among the factors that could cause actual results to differ materially from those expected are the following: business conditions and general economic conditions, competitive factors, such as pricing and marketing efforts, and the pace and success of product research and development. These and other factors may cause expectations to differ.

Current Business Plan of Operations

Independent Film Development Corporation’s (IFDC’s) overall plan of operations is to acquire and develop independent films for production, sales and distribution, with a goal toward significant partnerships with mini-major and the major film studios, such as Lionsgate and Sony, while simultaneously emulating those companies’ recipes for success.

Currently IFDC has no active operational business that specializes in the marketing and sale of independent films. However, IFDC does have a management and marketing sales staff with over 23 years of collective experience in identifying, producing, marketing and selling filmed entertainment. The majority of IFDC’s Sales/Distribution business operates in a small, low risk, and profitable segment of the entertainment industry that connects the independent filmmakers directly to the domestic and foreign distribution outlets worldwide.

IFDC’s mission is to develop, produce and acquire films with high profit margins and built in “profit” safety nets. We will seek to leverage the combined talents of an experienced management/producing and sales/distribution team to develop, produce and acquire films for sale and distribution, IFDC will look to incorporate and acquire additional entertainment business’s that compliment and assist our current portfolio to increase the value of our overall securities, and enhance shareholder value.

IFDC’s new plan of operations has three main components of film production and finance; Co-financing, acquiring product in the development stage, and its own film production. This, coupled with film distribution through our parent company’s new film distribution subsidiary, makes up the new revenue model for the Company.

Co-Financing

Co-financing is where a company such as IFDC goes out looking for films that are already financed at 50% or more. This can afford IFDC an opportunity to come in with the remaining funds and as co-financier/executive producer.

This is beneficial for several reasons, first we are "last in", meaning we have a shorter investment span then other investors and we will also negotiate to be first out. Many times a film has to start by a certain date due to actor availability, state incentives, or other time limits that force the film to make favorable deals so as to not lose the film.

The average co-financing deal usually works like this:

•

We would review the project and make sure it meets with our requirements of:

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Good Script

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A solid Director

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Actors of some prominence

We would also want the film to have some type of distribution already in place from foreign, domestic or both. If the project meets with our project requirements we would partner with the production and bring in the remaining cash.

For our investment we would expect an average of 110% to 130% return on our investment. Once IFDC and all other investors have recouped, then all additional income from the film would be split on a percentage basis based on the amount of the individual investor’s original investment. In addition, IFDC would receive a presentation credit in the opening titles and normally one or two executive producer credits. This not only builds IFDC’s brand name nationally and internationally it also helps us gain the respect of our peers in the industry. IFDC will constantly be on the lookout for these types of co-financing projects.

Acquire and Develop Original Product in Development Stage

With this strategy we will seek projects at an early stage, usually with a finished script and possibly a director, producer or actor attached, or some amount of equity, usually in the range of 10% to 25%.

The requirements are very similar to all of our production strategies:

1. Well written salable script with a genre that is on the wave of coming into popularity.

2. Salable actors attached or interested

3. Director of some prominence (actor directors for example)

4. Projects that have some hard money attached

5. Projects that have some form of distribution (rarely found at this stage)

6. Projects that have some studio interest (rarely found at this stage)

IFDC will seek out projects that have many of the points listed above, then “option” the projects for a period of one to three years for as little money as possible, sometimes without any cash up front at all.

IFDC will then set about developing the project to get it to the point of funding. This will include script re-writes, and attaching actors. We will also use any director or producer already attached to the film to help with the work thus enabling IFDC to have several projects developing at once while not straining our resources; we have the individual filmmakers do the lion’s share of the work while we supervise and advise.

If the project gets to a point where we think it is strong enough, we will attempt to procure financing through traditional film financing sources such as foreign and domestic deals. If we think the individual project is strong enough, we can try to raise a portion or all of the money ourselves through private investors.

If we are unsuccessful at any stage of the game we can stop devoting resources to the project and allow its option to simply expire.

With this strategy IFDC plans to harvest the best and strongest projects to proceed forward into production. The advantages to acquisitions at the development stage are: the ability to guide the development process along, gearing it for success, steering the important decisions such as cast, director etc in a direction that will help make a more successful and profitable film. In addition we will be able to gauge the viability of the project with a small investment and will not risk big dollars, resources, and time before we can establish if the film is marketable or not.

The negatives are simply that we will spend small amounts of cash developing projects, some of which we will not bring to fruition, and so those projects will be a loss, but the films we do move forward on will be much more assured of financial success.

Film Distribution

IFDC has no current film distribution business, but its plan of operations includes developing a distribution arm with the help of its management, who have over 23 years of film sales experience.

Each year, independent filmmakers produce over 15,000 films while only a small fraction are able to secure distribution for their product. At the same time, the proliferation of theatrical and home entertainment outlets, including DVD/video (e.g., Netflix, Fox Video, Sony Video, Wal-Mart, Blockbuster), pay-per-view/video-on-demand (e.g., IN DEMAND), pay & free cable/satellite (e.g., HBO, Showtime), free television, new media (internet, pod-casting, web series, electronic delivery systems, etc.) and international markets, has resulted in an ever-increasing demand for filmed entertainment content around the globe. However, the market connecting the filmmakers and the buyers of content is controlled by a few players in the industry.

The majority of the film distribution business will operate in a small, low risk, and profitable segment of the entertainment industry that connects the independent filmmakers and distribution outlets. The company’s principal activities will consist of the following three complementary areas (in order of emphasis):

Sales agent – The company licenses partially or fully completed films made by independent filmmakers to entertainment distributions companies such as those listed above. The company recoups expenses and earns commissions from the first dollar collected under the licensing deals it generates. Unlike film producers who make large investments in the production of their films (with little guarantee of return), The company is able to generate its revenue from these films with minimal investment and risk.

Negative pickups – The company produces a film on behalf of a studio. The company earns the difference between the predetermined budget and the actual cost of making the film, as well as a producer’s fee, typically generating between 5% - 10% of the total budget.

Film production – The company identifies, produces, and secures distribution of a film. The Company owns the film in perpetuity and directly participates in all revenue generated by the film. The company will only produce films when distribution is secured in advance by its sales agent arm.

There are few significant players in the small independent film sales agent business. The more prominent companies in this sector now focus on larger independent films. Companies such as New Line Cinema, LionsGate, and The Weinstein Company, all began selling and distributing low-budget independent films before being acquired by major studios or going public. As these companies have grown, their business has progressed towards larger budget films, creating a large opportunity for The Company with smaller budgeted films. In addition, investors such as Mark Cuban and Paul Allen are investing millions of dollars in entertainment production and distribution companies, such as Lions Gate, in order to secure content for their media outlets (HDNet and Charter Communications respectively).

The company’s leading distribution executive has 23 years experience in producing, selling and distributing feature film and television programming, have established a proven track record as well as valuable relationships throughout the entire film supply chain from independent producers to the buyers of filmed entertainment. These relationships allow The Company to operate in a lucrative and low-risk side of the entertainment business. The Company anticipates having offices in both New York and Los Angeles.

Film Distribution Industry Overview

The motion picture industry continues to both grow and evolve. 2006 U.S. box office gross revenues reached approximately $8.8 billion (a 3.6% increase over 2001). Non-theatrical revenues grew 21% from 2001 to $12.3 billion making 2002 the first time that the home video revenue has surpasses that of theatrical grosses.

In the U.S. and international markets, the number of outlets for filmed entertainment continues to increase and fuel demand. These outlets include: theaters, home video (DVD/Video purchases and rentals), television (pay per view (PPV), video on demand (VOD), premium and pay cable, free television, and satellite) and new media outlets. In particular, the subscription growth in satellite and digital cable systems has providers scrambling to acquire programming for up to 500 channels. As the number of home entertainment outlets continues to rise, the percentage of revenues earned by films in non-theatrical distribution outlets over all media outlets will continue to increase.

Another trend in the film industry is the significance of the independent film producers who produce over 15,000 films each year. (Independent films are defined as films financed by any source other than a major studio.) Independent film producers focus on raising money for the making and production of their films; they do not have the know-how or relationships to get their pictures distributed. Accordingly, of the thousand of films produced each year, only several hundred generate any revenue at all while only a few dozen get distributed to theaters. In fact, over 83% of DVDs in the market have never been released in theaters.

While the lion’s share of theatrical revenues continues to be generated from the major studio productions, the number of revenue generating films produced by independent filmmakers continues to rise. In 2006, worldwide sales of independent films (all outlets) were estimated to be well over $6 billion. Festivals like Sundance, Tribeca, Toronto, Berlin and others that showcase independent films are now major entertainment industry events. In addition, each year several low-budget independent movies continue to “breakout” generating hundreds of millions in revenues (e.g., Little Miss Sunshine, Napoleon Dynamite, Cabin Fever, Saw, Diary of A Mad Black Woman, The Blair Witch Project, etc.).

The making and marketing of a movie can be broadly divided into two areas – production and distribution.

Production

The production of a film includes:

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Identifying and acquiring the rights to a story.

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Preproduction (budgeting, casting, location scouting, set design, etc.)

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Principal photography

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Post production (editing, scoring, credits, dubbing, effects, etc.)

The aggregate costs associated with the production of a film are known as “negative costs”. Independent filmmakers typically finance these costs with proceeds from “friends and family”, and occasionally individual investors. The financial undertaking of independent film production represent the riskiest element in the economics of the film industry because even the best made film will generate no revenue without distribution. Unbelievably, extremely few independent films have secured distribution before production commences and only a small fraction of films made get distributed at all.

Distribution

The distribution of a film encompasses marketing, advertising and duplicating in all of the outlets (as described above). Films are usually distributed to markets in order of marginal revenue potential. Typically the order will be as follows:

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Domestic theatrical*

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Foreign theatrical*

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Worldwide DVD/Video

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Pay per view (PPV)

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Pay TV

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Foreign TV

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Network TV

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Syndication

*(Note as stated above, only a small percentage of films are distributed to theaters.)

Financial success in the theatrical markets is as much determined by a film’s marketing budget (which can equal and even surpass a film’s negative cost) as much as it is by the characteristics of the film (e.g., “quality”, cast, genre, etc.). Accordingly, most independent movies, many that appeal to niche audiences, skip theatrical outlets and go “straight to DVD/Video”.

With respect to domestic outlets, most film distribution (both theatrical and non-theatrical) is controlled by the major film entertainment companies (i.e., Disney, Fox, Paramount, etc.) as well as mini major companies (e.g., Lion’s Gate, Think Films, Focus Features). Independent filmmakers that do get distribution for their films typically receive “net proceed” deals which mean they receive licensee fees after the distributor/sales agent collects their commissions and recoups their costs.

Domestic Theatrical Distribution

Most producers of independent films that get distributed to the domestic theatrical marketplace do so under “net proceeds” arrangements. In these arrangements, the distributor retains a distribution fee from the “film rental” (amount received from the exhibitor) and recoups the costs incurred in distributing the film from proceeds. After these costs are recovered, the remaining amounts constitute “net proceeds” which are typically allocated according to negotiated percentages.

Foreign Distribution

Films released into foreign theatrical markets are typically licensed by distributors who then sublicense the rights to all outlets to foreign sub distributors on a territorial basis. With respect to independent films, these deals are usually done either on a net proceeds basis or on a flat fee basis.

Worldwide DVD/Video Distribution

DVD/video cassettes are sold by distributor/sales agents directly to wholesalers who resell them to retailers who in turn rent or sell them to the public.

Television Distribution

Films licensed for television distribution, which includes pay-per view/cable television, network television, satellite, VOD and television syndication, are typically done so for a fixed number of showings over a period usually commencing one to four years after the initial theatrical or DVD/video release of the picture. With syndication, producers may license the right to broadcast a picture on local commercial television stations in the United States.

Sales Agents

While there are purportedly a hundred plus companies that act as sales agents for independently produced films, there are only a handful of reputable companies with substantial backing and the ability to integrate and weather the ever changing marketplace.

Distribution Products and Services

The majority of the company’s distribution business will focus on the licensing of independently produced films to domestic and international distributors (as “sales agent”). In addition, The company will produce small budget movies for major and sub-major studios (“negative pickups”) as well as produce movies that the Company will own (“internal productions”) in perpetuity. All facets of The Company’s business are low-risk while the sales agent and internal production are highly complementary.

Sales Agent

The overwhelming majority of independent films are made without adequate financing and/or distribution arrangements. Often independent filmmakers run out of money during the finishing stages of a film. In some cases, films get “stuck” in post production due to lack of payment to suppliers or become foreclosed films held by financial institutions and/or post production houses. Those that have managed to complete their films then have the daunting undertaking of marketing the film to distributors.

The company’s primary focus is to act as a sales agent for independent film producers by providing the sales and marketing services for films. The company acquires the rights to license these films (which are either fully or partially completed) from the filmmakers for little or no cash outlay. The company then licenses the films to distributors in the various outlets (i.e., theatrical, home video, cable, TV, international, etc.). The process usually takes between 1 – 12 months beginning when the sales agreement is effected with the filmmaker. For a minimum cash outlay, The company participates in the revenue streams of films that cost hundreds of thousands to millions of dollars to produce. In addition, The company earns commissions from the first dollar received and recoups its upfront expense before the pr oducer receives any proceeds.

The company’s principals have the relationships and credibility with independent filmmakers, production suppliers and the distribution companies. This is due to their track record of profitably identifying and licensing films on behalf of producers. Further, the production experience of The company’s principals enables them to enable the completion of any unfinished films quickly and efficiently.

Acquisitions and Marketing

The company identifies films through its network of independent filmmakers as well as industry festivals and trade shows including Sundance, Tribeca, Cannes, and Toronto. The company estimates that it will represent, as a sales agent, 60+ films in the five years in this plan. These films are projected to have gross licensing fees ranging from $350,000 - $3,000,000 with the majority of films generating gross licensing fees in the high six figures. While it is possible that one or more of these films is distributed in theaters, the projected gross licensing fees only include revenue from non-theatrical outlets.

The company will acquire the rights to license (as sales agent) films for a period of 7-25 years in return for a commission ranging from 10-30% of the licensing fees paid by the distributors. In some cases, The Company will incur minimal upfront costs including: advances to the filmmaker, costs for finalizing the film, and marketing costs. Upon signing a sales agent agreement, The company and the filmmakers agree on the “market attendance fees”, trailer/artwork and other marketing costs. These costs, along with any advances to the filmmaker and/or costs to complete the film, are recouped by The Company after its commission, but before any proceeds are paid to the filmmaker. The company will incur costs of approximately $40-150K per film to prepare marketing materials including the production of a t railer, artwork, etc.

The company will market these films to distributors in all domestic and international outlets by utilizing its relationships with distributors for various markets as well as through industry shows and conferences (e.g., AFM, MIPCOM, NATPE).

Sample gross profit calculation for a typical sales agent arrangement:

	Total		The company (gross profit)
Gross licensing fees	$500,000
The company commission	(125,000)		$125,000
Acquisition cost	(50,000)	(A)
Marketing (trailer & artwork)	(50,000)	(A)	5,000	(B)
Market attendance fees	(70,000)	(A)	45,500	(C)
Balance to producer	$205,000
The company gross profit			$175,500

(A)

- Recoupable after commission

(B) - Marketing costs have a 10% margin

Negative Pickups

Studios often hire film production companies to produce lower budgeted films. In these situations, known as “negative pickups”, the studio and the production company agree on a budget for the film and the production company keeps the difference of the budget and the actual cost of producing the film, as well as a producer’s fee, typically generating between 5% - 10% of the total budget.

The company’s principals have profitably produced low budget films. The company’s ability to produce quality films at or under budget stems from low overhead and excellent relationships with industry suppliers. As The company does not receive funds (other than the producer’s fee which is paid over the course of production) from the studio until after the film is delivered, a credit facility will be arranged to cover the cost of producing the film. In addition, a completion bond is obtained.

The company expects to produce approximately 5 films under negative pickup arrangements with budgets ranging from $1.4M to $3.8M in the five years covered by this plan generating estimated profits ranging from $300K to $900K per film.

Internal Production

The financing and production of movies is often the riskiest and most rewarding part of the entertainment business. The company will mitigate the inherent risks by only producing films that have secured distribution in some or all markets. In addition, The Company will act as the sales agent for the films it produces. In the five years covered by this plan, The Company plans on producing 10 films with an average budget of $300,000. These films are estimated to generated revenues ranging from $500,000 to $1,500,000 averaging $700,000.

Motion Picture Production

Initially, the Company will produce quality, moderately budgeted feature-length motion pictures, from a variety of genres, for worldwide distribution, which it will generally develop internally. Said films will have a majority of the production budget pre-sold prior to embarking on production. The Company will look to have approximately 75% of any individual budget covered by license fees to mitigate the downside risk of production.

1. Late-Night Banner

Under a Late Night banner, the Company will produce feature-length motion pictures, generally budgeted at approximately $200,000 each (inclusive of corporate overhead and distribution expenses), with erotic R-Rated content that is produced to be distributed worldwide to cable television channels (e.g., HBO, Showtime, Cinemax and Playboy TV, etc.) worldwide during “late-night” time slots, and to and through the home entertainment distribution window (e.g., video and DVD). Depending on the products' genre and the audience the company wants to reach, this will determine which strategy needs to be implemented. IFDC has three strategies depending on the project:

1. Direct to Video (Home Video), Domestic and Foreign

2. Limited Theatrical, then Video, Domestic and Foreign

3. World Wide Theatrical then Video, Domestic and Foreign

All of these involve the company making a licensing agreement with a distribution company. We at IFDC strive to make strategic relationships with the best companies here in the United States and internationally. We do this by fostering relationships at various festivals and film markets like MIPTV, Mifed, AFM and Cannes Market.

Direct to Video (Home Video) - this will be used to create equity by selling the licenses for our current back catalogue for home video market.

We will find a DVD label that is compatible with our vision for this title. They will make a good transfer and only use the best quality for production in the creation of the DVD.

The DVD label will do a cross-market promotion of IFDC and the title, via press releases, PR and various other media on the release of the DVD, and then reviews after the title is released.

IFDC's name and branding will be shared with the DVD Company on the DVD packaging. IFDC will negotiate a good licensing fee with profits paid out every three months.

Direct to video will also be a possible route for some of IFDC’s smaller budget films that don’t meet to the standards of theatrical but are made with a small enough budget have a smaller overhead and so would be fine with a direct to video release.

Limited Theatrical

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3 to 4 months, of festival support to garner hype and awards in various film festivals, both domestically and internationally

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We will then carry this hype and PR on to one of the major film markets where we will acquire a distribution deal with a sales company or a studio (if a deal is not already in place). In the deal we will attempt to procure a limited theatrical release based on the success and exposure of the film at the markets and festivals.

•

After the limited theatrical run we will sell the rights to both foreign and domestic for DVD rights, via the direct-to-video plan mentioned in our first strategy.

Full Theatrical

This is where we would sell all rights to a studio or mini major, they in turn would handle all distribution and advertisement for both theatrical and home video markets.

Employees

As of September 30, 2010, we employed a total of 4 people, three of whom are management and one clerical personnel. We may require additional employees in the future. There is intense competition for capable, experienced personnel and there is no assurance the Company will be able to obtain new qualified employees when required.

The Company believes its relations with its employees are good.

Patents

The Company holds no patents for its products.

Government Regulation

Government approval is not necessary for the Company’s business and government regulations have a negligible effect on its business.

Competition

We compete with other companies which have greater financial resources and experience than us. Our competitors include other, larger entities, which have substantially greater financial and other resources than us.

Item 1A. RISK FACTORS

We are subject to various risks which may materially harm our business, financial condition and results of operations. You should carefully consider the risks and uncertainties described below and the other information in this filing before deciding to purchase our common stock. If any of these risks or uncertainties actually occur, our business, financial condition or operating results could be materially harmed. In that case, the trading price of our common stock could decline and you could lose all or part of your investment.

We are a relatively young company with no operating history

Since we are a young company, it is difficult to evaluate our business and prospects. At this stage of our business operations, even with our good faith efforts, potential investors have a high probability of losing their investment. Our future operating results will depend on many factors, including the ability to generate sustained and increased demand and acceptance of our products, the level of our competition, and our ability to attract and maintain key management and employees. While management believes their estimates of projected occurrences and events are within the timetable of their business plan, there can be no guarantees or assurances that the results anticipated will occur.

We expect to incur net losses in future quarters.

If we do not achieve profitability, our business may not grow or operate. We may not achieve sufficient revenues or profitability in any future period. We will need to generate revenues from the sales of our products or take steps to reduce operating costs to achieve and maintain profitability. Even if we are able to generate revenues, we may experience price competition that will lower our gross margins and our profitability. If we do achieve profitability, we cannot be certain that we can sustain or increase profitability on a quarterly or annual basis.

We will require additional funds to operate in accordance with our business plan

We may not be able to obtain additional funds that we may require. We do not presently have adequate cash from operations or financing activities to meet our short or long-term needs. If unanticipated expenses, problems, and unforeseen business difficulties occur, which result in material delays, we will not be able to operate within our budget. If we do not achieve our internally projected sales revenues and earnings, we will not be able to operate within our budget. If we do not operate within our budget, we will require additional funds to continue our business. If we are unsuccessful in obtaining those funds, we cannot assure you of our ability to generate positive returns to the Company. Further, we may not be able to obtain the additional funds that we require on terms acceptable to us, if at all. We do not currently have any established third-p arty bank credit arrangements. If the additional funds that we may require are not available to us, we may be required to curtail significantly or to eliminate some or all of our development, manufacturing, or sales and marketing programs.

We may seek to obtain them primarily through equity or debt financings. Such additional financing, if available on terms and schedules acceptable to us, if available at all, could result in dilution to our current stockholders and to you. We may also attempt to obtain funds through arrangement with corporate partners or others. Those types of arrangements may require us to relinquish certain rights to our intellectual property or resulting products.

We are highly dependent on Jeff Ritchie, our CEO. The loss of Mr. Ritchie, whose knowledge, leadership, and technical expertise upon which we rely, would harm our ability to execute our business plan

We are largely dependent on Jeff Ritchie, our CEO, for specific proprietary technical knowledge. Our ability to successfully market and distribute our products may be at risk from an unanticipated accident, injury, illness, incapacitation, or death of Mr. Ritchie. Upon such occurrence, unforeseen expenses, delays, losses and/or difficulties may be encountered. Our success may also depend on our ability to attract and retain other qualified management and sales and marketing personnel.

We compete for such persons with other companies and other organizations, some of which have substantially greater capital resources than we do. We cannot give you any assurance that we will be successful in recruiting or retaining personnel of the requisite caliber or in adequate numbers to enable us to conduct our business.

If capital is not available to us to expand our business operations, we will not be able to pursue our business plan

We will require substantial additional capital to acquire additional properties and to participate in the development of those properties. Cash flows from operations, to the extent available, will be used to fund these expenditures. We intend to seek additional capital from loans from current shareholders and from public and private equity offerings. Our ability to access capital will depend on its success in participating in properties that are successful in exploring for and producing oil and gas at profitable prices. It will also be dependent upon the status of the capital markets at the time such capital is sought. Should sufficient capital not be available, the development of our business plan could be delayed and, accordingly, the implementation of the USD Energy's business strategy would be adversely affected. In such event it would not be likely that investors would obtain a profitable return on their investments or a return of their investments.

Nevada Law and Our Charter May Inhibit a Takeover of Our Company That Stockholders May Consider Favorable

Provisions of Nevada law, such as its business combination statute, may have the effect of delaying, deferring or preventing a change in control of our company. As a result, these provisions could limit the price some investors might be willing to pay in the future for shares of our common stock.

Our Officers and Directors Have the Ability to Exercise Significant Influence Over Matters Submitted for Stockholder Approval and Their Interests May Differ From Other Stockholders

Our executive officers and directors, whether acting alone or together, may have significant influence in determining the outcome of any corporate transaction or other matter submitted to our stockholders for approval, including mergers, acquisitions, consolidations and the sale of all or substantially all of our assets, and also the power to prevent or cause a change in control. The interests of these executive officers and directors may differ from the interests of the other stockholders.

Tbe Market for Our Common Stock Is Illiquid

The market for our common stock is volatile and illiquid. As a result, this could adversely affect our shareholders' ability to sell our common stock in short time periods, or possibly at all. Our common stock has experienced, and is likely to experience in the future, significant price and volume fluctuations which could adversely affect the market price of our common stock without regard to our operating performance. In addition, we believe that factors such as quarterly fluctuations in our financial results and changes in the overall economy or the condition of the financial markets could cause the price of our common stock to fluctuate substantially. Substantial fluctuations in our stock price could significantly reduce the price of our stock.

The Penny Stock Rules cover our stock, which may make it difficult for a broker to sell investors’ shares. This may make our stock less marketable, and liquid, and result in a lower market price

Our common stock is a penny stock, which means that SEC rules require broker dealers who make transactions in the stock to comply with additional suitability assessments and disclosures than they would in stock that were not penny stocks, as follows:

Prior to the transaction, to approve the person's account for transactions in penny stocks by obtaining information from the person regarding his or her financial situation, investment experience and objectives, to reasonably determine based on that information that transactions in penny stocks are suitable for the person, and that the person has sufficient knowledge and experience in financial matters that the person or his or her independent advisor reasonably may be expected to be capable of evaluating the risks of transactions in penny stocks. In addition, the broker or dealer must deliver to the person a written statement setting forth the basis for the determination and advising in highlighted format that it is unlawful for the broker or dealer to effect a transaction in a penny stock unless the broker or dealer has received, prior to the transaction, a written agreement from the person. Further, the broker or dealer must receive a manually signed and dated written agreement from the person in order to effectuate any transactions is a penny stock.

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Prior to the transaction, the broker or dealer must disclose to the customer the inside bid quotation for the penny stock and, if there is no inside bid quotation or inside offer quotation, he or she must disclose the offer price for the security transacted for a customer on a principal basis unless exempt from doing so under the rules.

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Prior to the transaction, the broker or dealer must disclose the aggregate amount of compensation received or to be received by the broker or dealer in connection with the transaction, and the aggregate amount of cash compensation received or to be received by any associated person of the broker dealer, other than a person whose function in solely clerical or ministerial.

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The broker or dealer who has effected sales of penny stock to a customer, unless exempted by the rules, is required to send to the customer a written statement containing the identity and number of shares or units of each such security and the estimated market value of the security. Imposing these reporting and disclosure requirements on a broker or dealer make it unlawful for the broker or dealer to effect transactions in penny stocks on behalf of customers. Brokers or dealers may be discouraged from dealing in penny stocks, due to the additional time, responsibility involved, and, as a result, this may have a deleterious effect on the market for IFDC 's stock.

Our Officers and Directors Have the Ability to Exercise Significant Influence Over Matters Submitted for Stockholder Approval and Their Interests May Differ From Other Stockholders

Item 2. PROPERTIES

We sublease our executive offices in Los Angeles, California from our Secretary/Director Kenneth Eade, who agreed to cover certain operating expenses for our first year of operations. We consider our existing facilities to be adequate for our current needs. We have optioned the script for the motion picture, “Never Submit.” We also own the distribution rights to the following intellectual motion picture and television properties:

• L.A. Bounty

• Say it In Russian

• A Man of passion (with Anthony Quinn)

• Rush Week

• Trapper County War

• Kamillions

• Hostage

• Autograph celebrity interview series

• Sleep of Death (worldwide TV rights until 2015)

Item 3. LEGAL PROCEEDINGS

We are not a party to any material pending legal proceedings and, to the best of our knowledge, no such action by or against the Company has been threatened.

Item 4. (Removed and Reserved)

PART II

Item 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER

MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

The following securities were sold by the registrant from inception (September 17, 2007) to September 30, 2010, that were not registered under the Securities Act:

On September 24, 2007, 125 shares of common stock were issued to Kenneth Eade, pursuant to Section 4(2) of the Securities Act of 1933, in exchange for $500 cash

On December 30, 2007, 1,245 shares of common stock were issued to Kenneth Eade, pursuant to Section 4(2) of the Securities Act of 1933, in exchange for $4,980 cash.

On March 31, 2008, 2,691 shares of common stock were issued to Kenneth Eade, pursuant to Section 4(2) of the Securities Act of 1933, in exchange for $10,764 in cash.

On June 30, 2008, 9,439 shares of common stock were issued to Kenneth Eade, pursuant to Section 4(2) of the Securities Act of 1933, in exchange for $1,800 in cash and $35,396 in forgiveness of debt.

On August 22, 2008, 525 shares of common stock were issued to non-affiliate investors, pursuant to Section 4(2) of the Securities Act of 1933, and other applicable exemptions.

On November 29, 2007, 1,000,000 shares of common stock were issued to officer and director Kenneth Eade, in exchange for preferred stock of Imperia Entertainment, Inc., pursuant to Section 4(2) of the Securities Act of 1933.

On November 29, 2007, 1,000,000 shares of common stock were issued to officer and director George Ivakhnik, in exchange for preferred stock of Imperia Entertainment, Inc., pursuant to Section 4(2) of the Securities Act of 1933.

On August 26, 2008, the entire transaction by which shares of Imperia Entertainment, Inc. were acquired was mutually rescinded and the transaction was accounted for as follows:

On September 24, 2007, 125 shares of common stock were issued to Kenneth Eade, pursuant to Section 4(2) of the Securities Act of 1933.

On December 30, 2007, 1,245 shares of common stock were issued to Kenneth Eade, pursuant to Section 4(2) of the Securities Act of 1933, in exchange for $4,980 cash.

On March 31, 2008, 2,691 shares of common stock were issued to Kenneth Eade, pursuant to Section 4(2) of the Securities Act of 1933, in exchange for $10,764 in cash.

On June 30, 2008, 9,439 shares of common stock were issued to Kenneth Eade, pursuant to Section 4(2) of the Securities Act of 1933, in exchange for $1,800 in cash and $35,396 in forgiveness of debt.

On August 28, 2008, 1,250 shares of common stock were issued to non-affiliate investors, pursuant to Section 4(2) of the Securities Act of 1933, and other applicable exemptions.

On September 12, 2008, 125 shares of common stock were issued to non-affiliate investors, pursuant to Section 4(2) of the Securities Act of 1933, and other applicable exemptions.

On September 27, 2008, 717 shares of common stock were issued to non-affiliate investors, pursuant to Section 4(2) of the Securities Act of 1933, and other applicable exemptions.

On or about December 16, 2009, 27,500 shares of common stock were issued to a non-affiliate investor, pursuant to Section 4(2) of the Securities Act of 1933, and Regulation D, Rule 506, in exchange for a $110,000 subscription, $25,000 of which was paid in cash and $85,000 of which was due on February 26, 2009.

On or about December 31, 2008, 3,573 shares of common stock were issued to affiliate Kenneth Eade, in exchange for cash and forgiveness of debt.

On or about September 30, 2009, 200,000 shares each were issued to Directors Robert Searcy and Patrick Peach, as compensation for two years’ services rendered, pursuant to Section 4(2) of the Securities Act of 1933.

On or about September 30, 2009, 200,000 shares and 500,000 shares were issued to Jeff Ritchie for compensation for two years’ services rendered, and 10 million shares in exchange for business opportunities assigned to the company, pursuant to Section 4(2) of the Securities Act of 1933.

On or about September 30, 2009, 200,000 shares and 500,000 shares were issued to Kenneth Eade for compensation for two years’ services rendered, 500,000 for two years’ legal services rendered, and 10,000,000 shares in exchange for business opportunities assigned to the company, pursuant to Section 4(2) of the Securities Act of 1933.

During the three months period ended December 31, 2009 the Company issued 90,000 common stock shares for total consideration of $45,000.

During the three months period ended June 30, 2010 the Company issued 216,000 common shares for total consideration of $119,595.

During the three months period ended June 30, 2010, the Company issued 4,000 common shares for services totaling $2,000.

During the three months ended September 30, 2010, the Company issued 130,000 common shares for total consideration of $32,500.

During the year ended September 30, 2010 the Company received $22,660 on its subscription receivable.

No underwriters were used in any of the above-referenced sales.

The company’s common stock has no market and, although the issuer intends to attempt to obtain a quotation for its common stock on a quotation system such as the over-the-counter bulletin board, there can be no assurance that such a quotation will ever be established.

ISSUER PURCHASES OF EQUITY SECURITIES

The Company did not repurchase any of its securities during the fiscal year ended September 30, 2010.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

The Company currently does not maintain any equity compensation plans.

Item 6. SELECTED FINANCIAL DATA

The registrant is a smaller reporting company, pursuant to Rule 229.10(f)(1), and is not required to report this information. The financial statements of the issuer are attached.

Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS.

The company has focused since its inception on forming its corporate structure, developing its business plan and raising capital. The company is a development stage company with a plan of operations as set forth below.

PLAN OF OPERATIONS

IFDC’s overall plan of operations is to acquire and develop independent films for production, sales and distribution, with a goal toward significant partnerships with mini-major and the major film studios, such as Lionsgate and Sony, while simultaneously emulating those companies’ recipes for success. Some of these endeavors will include Maxim but many will be independent of Maxim and in partnership with similar distribution/production companies or with mini or major studios. The Maxim agreement has no clauses preventing IFDC in procuring any independent business outside of Maxim.

During the next twelve months, we plan to satisfy our cash requirements by funding from our principals and additional equity financing. However, we may be unsuccessful in raising additional equity financing, and, thus, be able to satisfy its cash requirements.

We will need a minimum of $500,000 to satisfy our cash requirements for the next twelve months. We will not be able to operate if it we do not obtain equity financing through subsequent private offerings, or contributions from our principals. If only a minimal amount of financing is raised, we will continue to satisfy our cash requirements by contributions from our principals, which we expect will continue to contribute for the next twelve months. We depend upon capital to be derived from future financing activities such as subsequent offerings of our stock. Management believes that, if this offering and the subsequent private placements are successful, we will be able to generate revenue and become profitable from advertising sales and achieve liquidity within the next twelve months.

Critical Accounting Estimates and Policies

The discussion and analysis of our financial condition and plan of operations is based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates including, among others, those affecting revenue, the allowance for doubtful accounts, the salability of inventory and the useful lives of tangible and intangible assets. The discussion below is intended as a brief discussion of some of the judgments and uncertainties that can impact the application of these policies and the specific dollar amounts reported on our financial statements. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form our basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions, or if management made different judgments or utilized different estimates. Many of our estimates or judgments are based on anticipated future events or performance, and as such are forward-looking in nature, and are subject to many risks and uncertainties, including those discussed below and elsewhere in this Registration Statement. We do not undertake any obligation to update or revise this discussion to reflect any future events or circumstances.

We have identified below some of our accounting policies that we consider critical to our business operations and the understanding of our results of operations. This is not a complete list of all of our accounting policies, and there may be other accounting policies that are significant to us. For a detailed discussion on the application of these and our other accounting policies, see note 1 to the financial statements for the period ended September 30, 2010, included in this Form 10K.

Stock Based Compensation.

Shares of the Company’s common stock may be issued for services. These issuances are valued at the fair market value of the services provided and the number of shares issued is determined based upon what the price of the common stock is on the date of each respective transaction.

Estimates.

The presentation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

Fair Value of Financial Instruments.

The carrying amounts for the Company’s cash, and related party payables approximate fair value due to the short-term maturity of these instruments.

Income Taxes

In February 1992, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 109, “Accounting for Income Taxes.” SFAS No. 109 required a change from the deferred method of accounting for income taxes of Accounting Principles Board (“APB”) Opinion No. 11 to the asset and liability method of accounting for income taxes. Under the asset and liability method of SFAS No. 109, deferred tax 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 apply to taxable income in the years in which those temporary differences are expected t o be recovered or settled. Under SFAS No. 109, 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.

Earnings (Loss) Per Share.

Basic earnings (loss) per share are computed by dividing the net income (loss) by the weighted-average number of shares of common stock and common stock equivalents (primarily outstanding options and warrants). Common stock equivalents represent the dilutive effect of the assumed exercise of the outstanding stock options and warrants, using the treasury stock method. The calculation of fully diluted earnings (loss) per share assumes the dilutive effect of the exercise of outstanding options and warrants at either the beginning of the respective period presented or the date of issuance, whichever is later.

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company’s business activities contain elements of risk. The Company considers a principal type of market risk to be a valuation risk. All assets are valued at fair value as determined in good faith by or under the direction of the Board of Directors (which is based, in part, on quoted market prices). Market prices of common equity securities in general, are subject to fluctuations which could cause the amount to be realized upon sale to differ significantly from the current reported value. The fluctuations may result from perceived changes in the underlying economic characteristics of the Company’s portfolio companies, the relative prices of alternative investments, general market conditions and supply and demand imbalances for a particular security.

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements and related notes are included as part of this report as indexed in the appendix on page F-1 through F-11.

Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND

FINANCIAL DISCLOSURE

Since inception, there have been no changes of or disagreements with our independent accountants.

Item 9A. CONTROLS AND PROCEDURES

As required by Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company carried out an evaluation under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Company’s disclosure controls and procedures as of September 30, 2010. In designing and evaluating the Company’s disclosure controls and procedures, the Company recognizes that there are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their desired control obj ectives. Additionally, in evaluating and implementing possible controls and procedures, the Company’s management was required to apply its reasonable judgment. Furthermore, management considered certain matters deemed by the Company’s independent auditors to constitute a material weakness in the Company’s internal control over financial reporting described below. Based upon the required evaluation, the Chief Executive Officer and Chief Financial Officer concluded that as of September 30, 2010, the Company has determined that its system of controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.

Item 9B. OTHER INFORMATION

None.

PART III

Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Name	Age	Position
Jeff Ritchie	50	Chief Executive Officer, Director

Kenneth Eade	50	Chief Compliance Officer, Chief Financial Officer, Secretary, Director
Erick Geisler	40	Vice President Production
Patrick Peach	49	Director

Sanford M. Passman	56	Director

Robert Searcy	49	Director

Affiliate Officers and Directors

Jeff Ritchie. Jeff Ritchie is the current Chief Executive Officer and director of the company, since 2008. Ritchie began his film career in post-production by using advancements in computer technology to create a cost-effective computer graphics company with such clients as Disney and CBS. Having a lifelong passion for filmmaking, Ritchie sold his company and started working in film production. Ritchie worked for various studios, completing over 15 films, during that time Ritchie quickly rose up the ranks of feature film producer, and has produced over a dozen feature films, written three produced scripts and produced numerous commercials all in the last eight years. Ritchie has experience in managing private production companies, working for such production companies as Crystal Sky Communications (Ghost Rider, Baby Genuises), Roger Corman’s New Horizon (The Haunting of Hell House), has become a mainstay in the film industry and has developed solid relationships with studios and mini majors along with working relationships with production companies, sales distribution companies and with management and talent agencies. Ritchie’s film credits include 'SOULKEEPER' a film made on a very modest budget, which premiered on the sci-fi channel in 2001 and scored in the top non-theatrical sales week after week at video stores.

He produced and wrote 'COOKERS' a hardcore, gritty drug/horror story that has made the rounds at many film festivals including Milan Film Festival where it won Best Film, Best Cinematography, Best Editing and Best Music. It also won best film and best script at Screamfest and has garnered awards at many other film festivals around the world. Cookers also enjoyed a small but successful theatrical release. Ritchie wrote and produced 'AMERICAN CRIME', a psychological thriller which stars Rachel Leigh Cook, Kip Pardue, Annabella Sciorra and Carey Elwes. He followed it with the release of the heartwarming romantic Comedy 'MR. FIXIT' starring David Boreanz. Both films had overseas theatrical releases and garnered high sales domestically.

Kenneth G. Eade. Mr. Eade is the current Secretary, Chief Compliance Officer, and Director of the Company, since inception. He currently serves as the Chief Financial Officer of the Company, since December 2008. He has served as the Chairman of Imperia Entertainment, Inc., from July 2005 through December 2007, and served as its CEO from March 2007 through December 2007. From February 2007 through September 2007, he served as the President of Muller Media, Inc. From September 30, 2003 through June 2005, he served as President of Muller Media, Inc. From 1998 to the present time, he has been engaged in the practice of corporate and securities law, doing public and private offerings, SEC filings, blue sky state filings, mergers and acquisitions, and helping small to medium sized development stage companies to obtain quotatio ns of their securities on recognized quotation mediums. From 1987 through 1998, he was engaged in the practice of general law, emphasizing corporate and securities law. He is a member of the California Bar, and the federal District Court for the Central District of California. He holds a Juris Doctor in Law from Southwestern University School of Law, and a B.A. in Liberal Studies from California State University, Northridge.

Erick Geisler. Mr. Geisler has acted as Vice President of Production since October 2009. He has worked hands-on in every aspect of post-production from software programming, film scanning and recording, on-line and sound-fx editing, music score to visual effects supervision. Over the past ten years, he has collaborated with some of the industry’s top film makers and visual effects companies, including Industrial Light and Magic and Digital Domain.

In recent years, Erick acted as Director of Technical Entertainment for the Fremont Street experience in Las Vegas, Nevada, where he produced content for the largest video screen in the world (spanning over 5 football fields long.) He most recently performed as the Director of 3D Animation as Visual Effects Supervisor for Larry Levinson Productions in Los Angeles where he completed 22 television mini-series and movies of the week for the Hallmark Channel. He received his BFA at the Art Center, Pasadena, in Illustration & Design as well as a BFA in Computer Science. Erick has worked on hit television series including “Supernova”, “The Curse of King Tut’s Tomb” and in mega block-buster films such as “Total Recall” and “Jurassic Park.”

Today Erick’s career has expanded from visual effects to a very successful career in producing. He is currently producing two features, ”November 2nd” and “Duel of Legends” and he is set to direct his third produced film “Yakuza,” starring Armand Assante, “American Gangster”, “Gotti”, “Memoirs of a Geisha” and “Pearl Harbor”.

Non-interested directors

Patrick Peach. Patrick Peach has been an independent director of the company since April 21, 2008. Mr. Peach started his entertainment career as a literary agent, and produced his first film at the age of 23. As an independent producer, his credits include, Prey of the Chameleon, A Showtime world premiere in 1992, The Chinatown Connection, Big Bad John, Bitter Harvest, and the Glass Shield. Through his own production company, Peach produced When the Bough Breaks (1993), Mother (1994) and Galaxis. From 1994 through 1995, Peach served as Supervising Producer for Film Finances, Inc. on the completion of eight visual effects intensive features by Full Moon Entertainment, including Josh Kirby: Time Warrior, Pre Hysteria II, and The Wee Folk I & II. In 1995, he produced Maximum Surge, an interactive game and movie for Digital Pictures. In 1996 he produced Sticks and Stones for Hallmark Entertainment, co-produced, DNA, an HBO World Premiere, and was Supervising Producer on Bombshell, a Sci-Fi Channel World Premiere. He also produced Suicide Kings (1998) for Artisan Entertainment. Since 1998, Peach has produced P.U.N.K.S., a Disney Original Picture, and worked on several films for Miramax, Lions Gate, and Dimension Films. In 2000, he co-produced Highlander: Endgame, and worked for Miramax on Equilibrium and Imposter. In 2001, as a result of his work on Project Greenlight, Peach produced Stolen Summer, released by Miramax in 2002. Since then, he has co-produced the Theme Park Attraction, StarTrek Voyager: Borg Encounter, Outin Riley (2004), Icon (2004), Canes, and has worked on Cookers (2005), the Guardian (2006), and Nanking. Peach also produces commercials for clients Renault, Volkswagen, Nickelodeon and Comedy Central. He has studied entertainment law, film pro duction; screenwriting, distribution, marketing and finance at UCLQ, USC, AFI and Writer’s Boot Camp.

Robert Searcy. Robert Searcy has been an independent director of the company since August 8, 2008. Mr. Searcy is the current principal of Terra Firma Services since 1995, a company which specializes in land use planning and project management and development. At the helm of Terra Firma, Mr. Searcy has managed telecommunications sites for AT&T Wireless, L.A. Cellular and Bechtel, and for Sprint and Lucent Technologies. From 2004 through 2007, he was employed as a Land use and Entitlement manager for MWH Development Corporation. From 1995 through 1996 he was employed as the Principal Planner for the City of Calabasas, managing the day to day operations of the Planning and Environmental Services Departments and served as the City Council and Planning Commission Coordinator/Liaison . From 1990 through 1995, he serv ed as Senior Planner for the City of Diamond Bar. He holds a Masters Degree in Urban Planning (1989) from Kansas University and a B.A. in Political Science (1985) from Washburn University. He has served on the board of directors of the Century City Chamber of Commerce, and the San Gabriel Fair Housing Council.

Item 11. EXECUTIVE COMPENSATION

The following table provides information as to cash compensation of all officers of the Company, for each of the Company’s last two fiscal years.

SUMMARY COMPENSATION TABLE

Name and principal position	Year	Salary	Stock Awards	Option Awards	Non-Equity Incentive Plan Compensation Earnings	Nonqualified Deferred Compensation Earnings	All Other Compensation	Total

Kenneth Eade, CCO, CFO, Sec.	2010	$0	$ 0	$0	$0	$0	$0	$0
Kenneth Eade, CCO, CFO, Sec.	2009	$0	$ 0	$0	$0	$0	$0	$0

Erick Geisler, V.P.	2010	$0	$ 0	$0	$0	$0	$0	$0
Erick Geisler, V.P.	2009	$0	$ 0	$0	$0	$0	$0	$0

Jeff Ritchie, CEO	2010	$50,000	$ 0	$0	$0	$0	$0	$0
Jeff Ritchie, CEO	2009	$0	$350,000	$0	$0	$0	$0	$0

The company has entered into employment contracts with each of our executive officers, providing for the payment of $120,000 each in annual salaries, commencing the first quarter of fiscal year 2009. There are no outstanding equity awards or options to officers issued or outstanding.

The following table provides information concerning the compensation of the directors of the Company for the past fiscal year:

DIRECTOR COMPENSATION

Name	Fees Earned or Paid in Cash	Stock Awards	Option Awards	Non-Equity Incentive Plan Compensation	Non-Qualified Deferred Compensation Earnings	All Other Compensation	Total
Kenneth Eade	$0	$0	$0	$0	$0	$0	$0
Jeff Ritchie	$0	$0	$0	$0	$0	$0	$0
Rob Searcy	$0	$0	$0	$0	$0	$0	$0
Patrick Peach	$0	$0	$0	$0	$0	$0	$0

There are no outstanding equity awards or options to directors issued or outstanding.

Corporate Governance

The Board of Directors is committed to maintaining strong corporate governance principles and practices. The Board periodically reviews evolving legal, regulatory, and best practice developments to determine those that will best serve the interests of our shareholders.

Meetings and Attendance

Our Board of Directors is required by our by laws to hold regularly scheduled annual meetings. In addition to the annual meetings, it has the authority to call regularly scheduled meetings and special meetings by resolution. Our Board met 2 times during the past fiscal year.

All incumbent directors attended 100% or more of the Board meetings during the last fiscal year.

Nominations of Directors

There are no material changes to the procedures by which security holders may recommend nominees to the registrant’s board of directors.

Audit Committee

The Company has standing audit committee, established in accordance with section 3(a)(58)(A) of the Securities Exchange Act of 1934, consisting of independent director Patrick Peach and independent director Robert Searcy. No member of the audit committee may accept directly or indirectly any consulting, advisory, or other compensatory fee from the company or any subsidiary, not including fixed amounts of compensation under a retirement plan for prior service, and may not be an “interested person” as defined in section 2(a)(19) of the Investment Company Act of 1940.

Item 12. SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

AND RELATED STOCKHOLDER MATTERS.

The following table sets forth information furnished to us with respect to the beneficial ownership of our common stock by (i) each executive officer, director and nominee, and by all directors and executive officers as a group, and (ii) each beneficial owner of more than five percent of our outstanding common stock, in each case as of September 30, 2010. Unless otherwise indicated, each of the persons listed has sole voting and dispositive power with respect to the shares shown as beneficially owned.

Title of Class	Name and Address ofBeneficial Owner	Amount of BeneficialOwnership	Percent of Class
Common Stock	Kenneth Eade 6399 Wilshire Blvd., Suite 507 Los Angeles, CA 90048	7,713,500	34.2%

Common Stock	Jeff Ritchie 6399 Wilshire Blvd. Suite 507 Los Angeles, CA 90048	7,700,000	34.1%

Common Stock	Patrick Peach 6399 Wilshire Blvd. suite 507 Los Angeles, CA 90048	200,000	10%

Common Stock	Erick Geisler 6399 Wilshire Blvd. Suite 507 Los Angeles, CA 90048	0

Common Stock	Arriva Capital 16 Glenwood Way Caldwell, NJ 07006	6,000,000	26.6%
Common Stock	Robert Searcy 6399 Wilshire Blvd. Suite 507 Los Angeles, CA 90048	200,000	1%

	Shares of directors and executive officers as a group	15,813,500	70.3%

The issuer is not aware of any person who owns of record, or is known to own beneficially, five percent or more of the outstanding securities of any class of the issuer, other than as set forth above. The issuer is not aware of any person who controls the issuer as specified in section 2(a)(1) of the Investment Company Act of 1940. The Company does not have an investment advisor.

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR

INDEPENDENCE