UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURUTIES EXCHANGE ACT OF 1934
For the fiscal year ended March 31, 2014
Commission file number 000-54667
INTEGRATED ELECTRIC SYSTEMS CORP.
(Exact name of small business issuer as specified in its charter)
RAIDER VENTURES INC.
(Former Name of small business issuer)
NEVADA 20-8624019
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
16133 Ventura Blvd., Suite 700
Encino, CA 91436
(Address of Principal Executive Offices & Zip Code)
(818) 995-9107
(Telephone Number)
Larry Segal
16133 Ventura Blvd., Suite 700
Encino, CA 91436
(818)995-9107
(Name, Address and Telephone Number of Agent for Service)
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to section 12(g) of the Act:
Common Stock, $.001 par value
Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes [ ] No [X]
Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act Yes [ ] No [X]
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer [ ] Accelerated Filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
(Do Not Check if a Smaller Reporting Company)
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [X] No [ ]
As of June 23, 2014, the registrant had 54,000,000 shares of common stock issued
and outstanding. No market value has been computed based upon the fact that no
active trading market had been established as of June 23, 2014.
INTEGRATED ELECTRIC SYSTEMS CORP.
TABLE OF CONTENTS
Page No.
--------
Part I
Item 1. Business 3
Item 1A. Risk Factors 4
Item 2. Properties 5
Item 3. Legal Proceedings 5
Item 4. Mine Safety Disclosures 5
Part II
Item 5. Market for Registrant's Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities 5
Item 6. Selected Financial Data 7
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations 7
Item 7A Quantitative and Qualitative Disclosures About Market Risk 9
Item 8. Financial Statements and Supplementary Data 10
Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure 21
Item 9A. Controls and Procedures 21
Part III
Item 10. Directors and Executive Officers 23
Item 11. Executive Compensation 25
Item 12. Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters 26
Item 13. Certain Relationships and Related Transactions 27
Item 14. Principal Accounting Fees and Services 27
Part IV
Item 15. Exhibits 28
Signatures 28
2
PART I
ITEM 1. BUSINESS
Integrated Electric Systems Corp (formerly known as Raider Ventures, Inc.) was
incorporated in the State of Nevada on March 5, 2007 as Northern Minerals, Inc.
We are a development stage company with no revenues and a limited operating
history.
Our original business was to engage in the acquisition, exploration and
development of natural resource properties. We received the results of Phase 1
and Phase 1A of the exploration program from the consulting geologist. The
findings were not promising and management determined it was in the best
interests of the shareholders to allow the claim to lapse.
We are investigating other properties on which exploration could be conducted
and other business opportunities to enhance shareholder value. During the next
twelve months we anticipate spending approximately $10,000 on professional fees,
including fees payable in complying with reporting obligations, and general
administrative costs.
BANKRUPTCY OR SIMILAR PROCEEDINGS
There has been no bankruptcy, receivership or similar proceeding.
REORGANIZATIONS, PURCHASE OR SALE OF ASSETS
There have been no material reclassifications, mergers, consolidations, or
purchase or sale of a significant amount of assets not in the ordinary course of
business.
PATENTS, TRADEMARKS, FRANCHISES, CONCESSIONS, ROYALTY AGREEMENTS, OR LABOR
CONTRACTS
We have no current plans for any registrations such as patents, trademarks,
copyrights, franchises, concessions, royalty agreements or labor contracts. We
will assess the need for any of these on an ongoing basis.
NEED FOR GOVERNMENT APPROVAL FOR ITS PRODUCTS OR SERVICES
We are not required to apply for or have any government approval for our
products or services.
RESEARCH AND DEVELOPMENT COSTS DURING THE LAST TWO YEARS
We have not expended funds for research and development costs during the last
two years.
EMPLOYEES AND EMPLOYMENT AGREEMENTS
Our only employee is our officer Larry Segal who currently devotes 3 hours per
week to company matters. He has agreed to devote as much time as the board of
directors determines is necessary to manage the affairs of the company. There is
no formal employment agreement between the company and our current employee.
3
REPORTS TO SECURITIES HOLDERS
We provide an annual report that includes audited financial information to our
shareholders. We make our financial information equally available to any
interested parties or investors through compliance with the disclosure rules of
the Securities Exchange Act of 1934, including filing Form 10K annually and Form
10Q quarterly. In addition, we will file Form 8K and other proxy and information
statements from time to time as required. We do not intend to voluntarily file
the above reports in the event that our obligation to file such reports is
suspended under the Exchange Act. The public may read and copy any materials
that we file with the Securities and Exchange Commission, ("SEC"), at the SEC's
Public Reference Room at 100 F Street NE, Washington, DC 20549. The public may
obtain information on the operation of the Public Reference Room by calling the
SEC at 1-800-SEC-0330. The SEC maintains an Internet site (http://www.sec.gov)
that contains reports, proxy and information statements, and other information
regarding issuers that file electronically with the SEC.
ITEM 1A. RISK FACTORS
BECAUSE OUR CONTINUATION AS A GOING CONCERN IS IN DOUBT, WE WILL BE FORCED TO
CEASE BUSINESS OPERATIONS UNLESS WE CAN GENERATE PROFIT IN THE FUTURE.
The report of our independent accountant to our audited financial statements for
the year ended March 31, 2014 indicates that there are a number of factors that
raise substantial doubt about our ability to continue as a going concern. Such
factors identified in the report are that we have no source of revenue and our
dependence upon obtaining adequate financing. If we are not able to continue as
a going concern, it is likely investors will lose all of their investment.
BECAUSE WE HAVE A LIMITED OPERATING HISTORY, WE FACE A HIGH RISK OF BUSINESS
FAILURE.
Investors should be aware of the difficulties normally encountered by new
mineral exploration companies and the high rate of failure of such enterprises.
The likelihood of success must be considered in light of the problems, expenses,
difficulties, complications and delays encountered in connection with the
exploration of mineral properties. These potential problems include, but are not
limited to, unanticipated problems relating to exploration, and additional costs
and expenses that may exceed current estimates.
BECAUSE OF THE INHERENT DANGERS INVOLVED IN MINERAL EXPLORATION, THERE IS A RISK
THAT WE MAY INCUR LIABILITY OR DAMAGES, WHICH COULD HURT OUR FINANCIAL POSITION
AND POSSIBLY RESULT IN THE FAILURE OF OUR BUSINESS.
The search for valuable minerals involves numerous hazards. As a result, we may
become subject to liability for such hazards, including pollution, cave-ins and
other hazards against which we cannot insure or against which we may elect not
to insure. The payment of such liabilities may have a material adverse effect on
our financial position.
GOVERNMENT REGULATION OR OTHER LEGAL UNCERTAINTIES MAY INCREASE COSTS AND OUR
BUSINESS WILL BE NEGATIVELY AFFECTED.
4
Laws and regulations govern the exploration, development, mining, production,
importing and exporting of minerals; taxes; labor standards; occupational
health; waste disposal; protection of the environment; mine safety; toxic
substances; and other matters. In many cases, licenses and permits are required
to conduct mining operations. Amendments to current laws and regulations
governing operations and activities of mining companies or more stringent
implementation thereof could have a substantial adverse impact on us. Applicable
laws and regulations will require us to make certain capital and operating
expenditures to initiate new operations. Under certain circumstances, we may be
required to stop exploration activities once started until a particular problem
is remedied or to undertake other remedial actions.
BECAUSE OUR DIRECTOR HAS OTHER BUSINESS INTERESTS, HE MAY NOT BE ABLE OR WILLING
TO DEVOTE A SUFFICIENT AMOUNT OF TIME TO OUR BUSINESS OPERATIONS, CAUSING OUR
BUSINESS TO FAIL.
Our president and director, Larry Segal, currently devotes approximately 7% of
his business time (3 hours per week) to the company. While he presently
possesses adequate time to attend to our interests, it is possible that the
demands on him from their other obligations could increase with the result that
he would no longer be able to devote sufficient time to the management of our
business.
ITEM 2. PROPERTIES
We do not currently own any property. We leased office facilities at 16133
Ventura Blvd., Suite 700, Encino, CA for $149.00 per month on an annual lease
basis. The facilities included reception, telephone, fax, and office facilities.
Management is now looking for new facilities.
We currently have no investment policies as they pertain to real estate, real
estate interests or real estate mortgages.
ITEM 3. LEGAL PROCEEDINGS
We are not currently involved in any legal proceedings and we are not aware of
any pending or potential legal actions.
ITEM 4. MINE SAFETY DISCLOSURES
N/A.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Our shares are quoted on the OTC Electronic Bulletin Board (OTCBB) under the
symbol "ISSP". The OTCBB is a regulated quotation service that displays
real-time quotes, last sale prices and volume information in over-the-counter
securities. Securities quoted on the OTCBB that become delinquent in their
required filings will be removed following a 30 or 60 day grace period if they
do not make their required filing during that time. There has been no active
5
trading of our securities, and, therefore, no high and low bid pricing. As of
the date of this report the company had 32 shareholders of record. We have paid
no cash dividends and have no outstanding options.
PENNY STOCK RULES
The Securities and Exchange Commission has also adopted rules that regulate
broker-dealer practices in connection with transactions in penny stocks. Penny
stocks are generally equity securities with a price of less than $5.00 (other
than securities registered on certain national securities exchanges or quoted on
the Nasdaq system, provided that current price and volume information with
respect to transactions in such securities is provided by the exchange or
system).
A purchaser is purchasing penny stock which limits the ability to sell the
stock. Our shares constitute penny stock under the Securities and Exchange Act.
The shares will remain penny stocks for the foreseeable future. The
classification of penny stock makes it more difficult for a broker-dealer to
sell the stock into a secondary market, which makes it more difficult for a
purchaser to liquidate his/her investment. Any broker-dealer engaged by the
purchaser for the purpose of selling his or her shares in us will be subject to
Rules 15g-1 through 15g-10 of the Securities and Exchange Act. Rather than
creating a need to comply with those rules, some broker-dealers will refuse to
attempt to sell penny stock.
The penny stock rules require a broker-dealer, prior to a transaction in a penny
stock not otherwise exempt from those rules, to deliver a standardized risk
disclosure document, which:
- contains a description of the nature and level of risk in the market
for penny stock 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 of such duties or other requirements of the
Securities Act of 1934, as amended;
- contains a brief, clear, narrative description of a dealer market,
including "bid" and "ask" price for the penny stock 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 broker-dealer also must provide, prior to effecting any transaction in a
penny stock, to the customer:
- the bid and offer quotations for the penny stock;
6
- 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.
In addition, the penny stock rules require that prior to a transaction in a
penny stock not otherwise exempt from those rules; the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser's written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements will have the effect of reducing the trading
activity in the secondary market for our stock because it will be subject to
these penny stock rules. Therefore, stockholders may have difficulty selling
their securities.
REPORTS
We are subject to certain filing requirements and will furnish annual financial
reports to our stockholders, certified by our independent accountant, and will
furnish un-audited quarterly financial reports in our quarterly reports filed
electronically with the Securities and Exchange Commission. All reports and
information filed by us can be found at their website, www.sec.gov.
TRANSFER AGENT
The company has retained Action Stock Transfer, Inc. of 2469 E Ft. Union Blvd,
Suite 214, Salt Lake City, Utah as transfer agent.
ITEM 6. SELECTED FINANCIAL DATA
Not applicable to a "smaller reporting company" as defined in Item 10(f)(1) of
SEC regulation S-K.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Integrated Electric Systems Corp (formerly known as Raider Ventures, Inc.) was
incorporated in the State of Nevada on March 5, 2007 as Northern Minerals, Inc.
We are a development stage company with no revenues or operating history.
Our original business was to engage in the acquisition, exploration and
development of natural resource properties. We received the results of Phase 1
and Phase 1A of the exploration program from the consulting geologist. The
findings were not promising and management determined it was in the best
interests of the shareholders to allow the claim to lapse.
7
On September 28, 2012, we filed Articles of Merger with the Nevada Secretary of
State to change our name from "Northern Minerals Inc." to "Raider Ventures
Inc.", to be effected by way of a merger with our wholly-owned subsidiary Raider
Ventures Inc., which was created solely for the name change.
Also on September 28, 2012, we filed a Certificate of Change with the Nevada
Secretary of State to give effect to a forward split of our authorized and
issued and outstanding shares of common stock on a ten (10) new for one (1) old
basis and, consequently, our authorized capital increased from 75,000,000 to
750,000,000 and correspondingly, our issued and outstanding shares of common
stock increased from 5,400,000 to 54,000,000 shares of common stock, all with a
par value of $0.001.
These amendments became effective on October 3, 2012 upon approval from the
Financial Industry Regulatory Authority ("FINRA").
The forward split and name change became effective with the Over-the-Counter
Bulletin Board at the opening of trading on October 3, 2012. After 30 business
days from October 3, 2012, our ticker symbol was changed from "NHMID" to "RDVN"
to better reflect our new name.
On March 19, 2013, our Board of Directors approved an agreement and plan of
merger to merge with and into our wholly-owned subsidiary Integrated Electric
Systems Corp., a Nevada corporation, to effect a name change from Raider
Ventures Inc. to Integrated Electric Systems Corp. Integrated Electric Systems
Corp. was created solely for the name change.
The name change became effective with the Over-the-Counter Bulletin Board at the
opening of trading on April 1, 2013 under the company's new symbol "ISSP".
As a result, we are investigating other properties on which exploration could be
conducted and other business opportunities to enhance shareholder value. During
the next twelve months we anticipate spending approximately $10,000 on
professional fees, including fees payable in complying with reporting
obligations, and general administrative costs.
LIQUIDITY AND CAPITAL RESOURCES
Our cash in the bank at March 31, 2014 was $22 and outstanding liabilities were
$128,900. We have sold $57,000 in equity securities since inception, $10,000
from the sale of 2,000,000 shares of stock to our officers and directors, $7,000
from the issuance of 1,400,000 shares of stock to a director in repayment of the
funds paid by him for the acquisition of the mineral claim and $40,000 from the
sale of 2,000,000 shares registered pursuant to our SB-2 Registration Statement
which became effective on October 12, 2007. If we experience a shortfall of
funds, our director has agreed to continue to loan us funds; however, he has no
obligation to do so.
As of March 31, 2014, there are loans payable to an unrelated party for $120,000
principal and $5,450 accrued interest. The loans bear interest at 4% per annum
and are due June 2014 ($20,000), August 2014 ($30,000), October 2014 ($10,000),
December 2014 ($5,000), December 2014 ($50,000) and February 2015 ($5,000).
8
RESULTS OF OPERATIONS
We are still in our development stage and have no revenues to date. Our net loss
since inception through March 31, 2014 was $184,618.
We incurred operating expenses of $47,132 and $33,530 for the years ended March
31, 2014 and 2013, respectively. These expenses consisted of professional fees
and general operating expenses incurred in connection with the day to day
operation of our business and the preparation and filing of our periodic
reports. Our net loss from inception (March 5, 2007) through March 31, 2014 was
$184,618.
Our auditors expressed their doubt about our ability to continue as a going
concern unless we are able to raise additional capital and ultimately to
generate profitable operations.
LIQUIDITY AND CAPITAL RESOURCES
Our cash in the bank at March 31, 2014 was $22 and outstanding liabilities were
$128,900. We have sold $57,000 in equity securities since inception, $10,000
from the sale of 2,000,000 shares of stock to our officers and directors, $7,000
from the issuance of 1,400,000 shares of stock to a director in repayment of the
funds paid by him for the acquisition of the mineral claim and $40,000 from the
sale of 2,000,000 shares registered pursuant to our SB-2 Registration Statement
which became effective on October 12, 2007. If we experience a shortfall of
funds, our director has agreed to continue to loan us funds; however, he has no
obligation to do so.
As of March 31, 2014, there are loans payable to an unrelated party for $120,000
principal and $5,450 accrued interest. The loans bear interest at 4% per annum
and are due June 2014 ($20,000), August 2014 ($30,000), October 2014 ($10,000),
December 2014 ($5,000), December 2014 ($50,000) and February 2015 ($5,000).
OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements.
PLAN OF OPERATION
We are investigating other properties on which exploration could be conducted
and other business opportunities to enhance shareholder value. During the next
twelve months we anticipate spending approximately $10,000 on professional fees,
including fees payable in complying with reporting obligations, and general
administrative costs.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable to a "smaller reporting company" as defined in Item 10(f)(1) of
SEC regulation S-K.
9
ITEM 8. FINANCIAL STATEMENTS
[LETTERHEAD OF KYLE L. TINGLE, CPA, LLC]
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
Integrated Electric Systems Corp. f/k/a/ Raider Ventures, Inc.
We have audited the accompanying balance sheets of Integrated Electric Systems,
Inc. as of March 31, 2014 and 2013 and the related statements of operations,
stockholders' equity, and cash flows for the years then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audits included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Integrated Electric Systems
Corp. as of March 31, 2014 and 2013 and the results of its operations and cash
flows for the year then ended, in conformity with U.S. generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 6 to the
financial statements, the Company has limited operations and has limited
established sources of revenue. This raises substantial doubt about its ability
to continue as a going concern. Management's plan in regard to these matters is
also described in Note 6. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
/s/ Kyle L. Tingle, CPA, LLC
--------------------------------------
Kyle L. Tingle, CPA, LLC
June 13, 2014
Las Vegas, Nevada
10
INTEGRATED ELECTRIC SYSTEMS CORP.
(A Development Stage Company)
Balance Sheets
--------------------------------------------------------------------------------
As of As of
March 31, 2014 March 31, 2013
-------------- --------------
ASSETS
CURRENT ASSETS
Cash $ 22 $ 7,156
Prepaid expenses 1,260 2,990
---------- ----------
TOTAL CURRENT ASSETS 1,282 10,146
---------- ----------
TOTAL ASSETS $ 1,282 $ 10,146
========== ==========
LIABILITIES & STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Accounts payable $ 3,450 $ 5,182
Accrued interest 5,450 1,337
Note payable 120,000 80,000
---------- ----------
TOTAL CURRENT LIABILITIES 128,900 86,519
TOTAL LIABILITIES 128,900 86,519
STOCKHOLDERS' DEFICIT
Common stock, $0.001 par value, 750,000,000 shares
authorized; 54,000,000 shares issued and outstanding as
at March 31, 2014 and March 31, 2013 54,000 54,000
Additional paid-in capital 3,000 3,000
Deficit accumulated during development stage (184,618) (133,373)
---------- ----------
TOTAL STOCKHOLDERS' DEFICIT (127,618) (76,373)
---------- ----------
TOTAL LIABILITIES & STOCKHOLDERS' DEFICIT $ 1,282 $ 10,146
========== ==========
See Notes to Financial Statements.
11
INTEGRATED ELECTRIC SYSTEMS CORP.
(A Development Stage Company)
Statements of Operations
--------------------------------------------------------------------------------
March 5, 2007
(inception)
Year Ended Year Ended through
March 31, 2014 March 31, 2013 March 31, 2014
-------------- -------------- --------------
REVENUES
Revenues $ -- $ -- $ --
------------ ------------ ------------
TOTAL REVENUES -- -- --
EXPENSES
Professional fees 10,482 19,644 75,125
General and administrative expenses 36,651 13,886 104,043
------------ ------------ ------------
NET OPERATING LOSS 47,132 33,530 179,168
OTHER EXPENSES
Interest expense 4,114 1,337 5,450
------------ ------------ ------------
NET LOSS $ (51,246) $ (34,866) $ (184,618)
============ ============ ============
BASIC AND DILUTED LOSS PER SHARE $ (0.00) $ (0.00)
============ ============
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 54,000,000 54,000,000
============ ============
See Notes to Financial Statements.
12
INTEGRATED ELECTRIC SYSTEMS CORP.
(A Development Stage Company)
Statement of Changes in Stockholders' Equity (Deficit)
From March 5, 2007 (Inception) through March 31, 2014
--------------------------------------------------------------------------------
Deficit
Accumulated
Common Additional During
Common Stock Paid-in Exploration
Stock Amount Capital Stage Total
----- ------ ------- ----- -----
BALANCE, MARCH 5, 2007 -- $ -- $ -- $ -- $ --
Stock issued for cash on March 5, 2007
@ $0.005 per share 10,000,000 100 4,900 5,000
Stock issued for mining claims on
March 29, 2007 @ $0.005 per share 14,000,000 140 6,860 7,000
Net loss, March 31, 2007 -- -- -- (7,415) (7,415)
---------- -------- -------- --------- ---------
BALANCE, MARCH 31, 2007 24,000,000 240 11,760 (7,415) 4,585
---------- -------- -------- --------- ---------
Stock issued for cash on July 3, 2007 10,000,000 10,000 (5,000) 5,000
@ $0.005 per share
Stock issued for cash on February 18, 2008 20,000,000 20,000 20,000 40,000
@ $0.02 per share
Net loss, March 31, 2008 -- -- -- (26,264) (26,264)
---------- -------- -------- --------- ---------
BALANCE, MARCH 31, 2008 54,000,000 54,000 3,000 (33,679) 23,321
---------- -------- -------- --------- ---------
Net loss, March 31, 2009 -- -- -- (27,274) (27,274)
---------- -------- -------- --------- ---------
BALANCE, MARCH 31, 2009 54,000,000 54,000 3,000 (60,953) (3,953)
---------- -------- -------- --------- ---------
Net loss, March 31, 2010 -- -- -- (11,499) (11,499)
---------- -------- -------- --------- ---------
BALANCE, MARCH 31, 2010 54,000,000 54,000 3,000 (72,452) (15,452)
---------- -------- -------- --------- ---------
Net loss, March 31, 2011 -- -- -- (11,175) (11,175)
---------- -------- -------- --------- ---------
BALANCE, MARCH 31, 2011 54,000,000 54,000 3,000 (83,627) (26,627)
---------- -------- -------- --------- ---------
Net loss, March 31, 2012 -- -- -- (14,880) (14,880)
---------- -------- -------- --------- ---------
BALANCE, MARCH 31, 2012 54,000,000 54,000 3,000 (98,507) (41,507)
---------- -------- -------- --------- ---------
Net loss, March 31, 2013 -- -- -- (34,866) (34,866)
---------- -------- -------- --------- ---------
BALANCE, MARCH 31, 2013 54,000,000 54,000 3,000 (133,373) (76,373)
---------- -------- -------- --------- ---------
Net loss, March 31, 2014 -- -- -- (51,246) (51,246)
---------- -------- -------- --------- ---------
BALANCE, MARCH 31, 2014 54,000,000 $ 54,000 $ 3,000 $(184,618) $(127,618)
========== ======== ======== ========= =========
See Notes to Financial Statements.
13
INTEGRATED ELECTRIC SYSTEMS CORP.
(A Development Stage Company)
Statements of Cash Flows
--------------------------------------------------------------------------------
March 5, 2007
(inception)
Year Ended Year Ended through
March 31, 2014 March 31, 2013 March 31, 2014
-------------- -------------- --------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (51,246) $ (34,866) $ (184,618)
Adjustments to reconcile net loss to net
cash used in operating activities:
Changes in operating assets and liabilities:
Prepaid expenses 1,730 (2,990) (1,260)
Accounts payable and accrued liabilities 2,382 -- 8,900
---------- ---------- ----------
NET CASH USED IN OPERATING ACTIVITIES (47,134) (37,856) (176,978)
CASH FLOWS FROM INVESTING ACTIVITIES
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES -- -- --
CASH FLOWS FROM FINANCING ACTIVITIES
Payment on Loan from a director -- (42,800) --
Proceeds from Notes payable 40,000 80,000 120,000
Proceeds from Issuance of common stock -- -- 57,000
---------- ---------- ----------
NET CASH USED IN FINANCING ACTIVITIES 40,000 37,200 177,000
---------- ---------- ----------
NET INCREASE (DECREASE) IN CASH (7,134) (656) 22
CASH AT BEGINNING OF PERIOD 7,156 1,293 --
---------- ---------- ----------
CASH AT END OF PERIOD $ 22 $ 637 $ 22
========== ========== ==========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during year for:
Interest $ -- $ -- $ --
========== ========== ==========
Income Taxes $ -- $ -- $ --
========== ========== ==========
See Notes to Financial Statements.
14
INTEGRATED ELECTRIC SYSTEMS CORP.
(A Development Stage Company)
Notes to Financial Statements
As at March 31, 2014
--------------------------------------------------------------------------------
NOTE 1 - NATURE AND PURPOSE OF BUSINESS
Integrated Electric Systems Corp. (the "Company") was incorporated under the
laws of the State of Nevada on March 5, 2007. The Company's activities to date
have been limited to organization and capital formation. The Company is "a
development stage company" and had acquired a series of mining claims for
exploration. The Company conducted exploration activities and determined that
its claims did not warrant any further exploration and now the Company is
looking for other potential business opportunities.
The Company has not earned any revenue from limited principal operations.
Accordingly, the Company's activities have been accounted for as those of a
"Development Stage Entity" as set forth in Financial Accounting Standards Board
("FASB") Accounting Standards Codification ("ASC") 915. Among the disclosures
required by ASC Topic 915 are that the Company's financial statements be
identified as those of a development stage company, and that the statements of
earnings, retained earnings and stockholders' equity and cash flows disclose
activity since the date of the Company's inception. All losses accumulated since
inception have been considered as part of the Company's development stage
activities.
NOTE 2 - NATURE OF SIGNIFICANT ACCOUNTING POLICIES
CASH AND CASH EQUIVALENTS
The Company considers all highly liquid debt instruments purchased with maturity
of three months or less to be cash equivalents. The Company had no cash
equivalents as of March 31, 2014 and 2013.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period.
Management makes its best estimate of the ultimate outcome for these items based
on historical trends and other information available when the financial
statements are prepared. Changes in estimates are recognized in accordance with
the accounting rules for the estimate, which is typically in the period when new
information becomes available to management. Actual results could differ from
those estimates.
15
INTEGRATED ELECTRIC SYSTEMS CORP.
(A Development Stage Company)
Notes to Financial Statements
As at March 31, 2014
--------------------------------------------------------------------------------
NOTE 2 - NATURE OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company follows the guidelines in ASC Topic 820 "Fair Value Measurements and
Disclosures". Fair value is defined as the price that would be received from
selling an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. When determining the fair
value measurements for assets and liabilities, which are required to be recorded
at fair value, the Company considers the principal or most advantageous market
in which the Company would transact and the market-based risk measurements or
assumptions that market participants would use in pricing the asset or
liability, such as inherent risk, transfer restrictions and credit risk.
The Company applies the following fair value hierarchy, which prioritizes the
inputs used to measure fair value into three levels and bases the categorization
within the hierarchy upon the lowest level of input that is available and
significant to the fair value measurement:
Level 1 -- Quoted prices in active markets for identical assets or liabilities.
Level 2 -- Observable inputs other than quoted prices in active markets for
identical assets and liabilities, quoted prices for identical or similar assets
or liabilities in inactive markets, or other inputs that are observable or can
be corroborated by observable market data for substantially the full term of the
assets or liabilities.
Level 3--inputs are generally unobservable and typically reflect management's
estimates of assumptions that market participants would use in pricing the asset
or liability. The fair values are therefore determined using model-based
techniques, including option pricing models and discounted cash flow models.
ASC Topic 820, in and of itself, does not require any fair value measurements.
As at March 31, 2014 and March 31, 2013, the Company did not have assets or
liabilities subject to fair value measurement.
EARNINGS PER SHARE
The Company reports basic loss per share in accordance with ASC Topic 260
"Earnings Per Share" ("EPS"). Basic loss per share is based on the weighted
average number of common shares outstanding and diluted EPS is based on the
weighted average number of common shares outstanding and dilutive common stock
equivalents. Basic EPS is computed by dividing net loss (numerator) applicable
to common stockholders by the weighted average number of common shares
outstanding (denominator) for the period. There are no potentially dilutive
securities outstanding and therefore, diluted earnings per share on not
presented. All per share and per share information are adjusted retroactively to
reflect stock splits and changes in par value.
16
INTEGRATED ELECTRIC SYSTEMS CORP.
(A Development Stage Company)
Notes to Financial Statements
As at March 31, 2014
--------------------------------------------------------------------------------
NOTE 2 - NATURE OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INCOME TAXES
Income taxes are provided in accordance with ASC No. 740, "Accounting for Income
Taxes." A deferred tax asset or liability is recorded for all temporary
differences between financial and tax reporting and net operating loss
carryforwards. Deferred tax expense (benefit) results from the net change during
the year of deferred tax assets and liabilities.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of
management, it is more likely than not that some portion or all of the deferred
tax assets will not be realized. Deferred tax assets and liabilities are
adjusted for the effects of changes in tax laws and rates on the date of
enactment.
RECENT ACCOUNTING PRONOUNCEMENTS
The Company does not expect that the adoption of other recent accounting
pronouncements will have a material impact to its financial statements.
NOTE 3 - COMMON STOCK
Transactions, other than employees' stock issuance, are in accordance with ASC
No. 505. Thus issuances shall be accounted for based on the fair value of the
consideration received. Transactions with employees' stock issuance are in
accordance with ASC No. 718. These issuances shall be accounted for based on the
fair value of the consideration received or the fair value of the equity
instruments issued, or whichever is more readily determinable.
On March 5, 2007 the Company issued 500,000 shares of common stock to Damian
O'Hara, a director and 500,000 shares of common stock to Nicole O'Hara, a
director, for cash in the amount of $0.005 per share for a total of $5,000.
On March 29, 2007 the Company issued a total of 1,400,000 shares of common stock
at $.005 per share to Damian O'Hara in repayment of $7,000 paid on behalf of the
Company for the acquisition of the mining claims.
On July 3, 2007 the Company issued 1,000,000 shares of common stock to Nicole
O'Hara, a director, for cash in the amount of $0.005 per share for a total of
$5,000.
On February 18, 2008 the Company issued 2,000,000 shares of common stock to 30
unrelated investors in the Company's SB-2 offering for cash in the amount of
$0.02 per share for a total of $40,000.
17
INTEGRATED ELECTRIC SYSTEMS CORP.
(A Development Stage Company)
Notes to Financial Statements
As at March 31, 2014
--------------------------------------------------------------------------------
NOTE 3 - COMMON STOCK (CONTINUED)
On September 28, 2012, the Company filed a Certificate of Change with the Nevada
Secretary of State to give effect to a forward split of our authorized and
issued and outstanding shares of common stock on a ten (10) new for one (1) old
basis and, consequently, our authorized capital increased from 75,000,000 to
750,000,000 and correspondingly, our issued and outstanding shares of common
stock increased from 5,400,000 to 54,000,000 shares of common stock, all with a
par value of $0.001.
NOTE 4 - RELATED PARTY TRANSACTIONS
Lawrence G. Segal, the sole officer and director of the Company may, in the
future, become involved in other business opportunities as they become
available, thus he may face a conflict in selecting between the Company and
their other business opportunities. The Company has not formulated a policy for
the resolution of such conflicts.
For the period ending March 31, 2014 and 2013, payroll expenses of $30,500 and
$5,000 were incurred by the officer.
NOTE 5 - NOTES PAYABLE
Notes payable as of March 31, 2014 are:
Unsecured promissory note payable, dated August 13, 2012
bearing interest at 4% per annum, due August 13, 2014. $ 30,000
Unsecured promissory note payable, dated December 18, 2012
bearing interest at 4% per annum, due December 18, 2014. 50,000
Unsecured promissory note payable, dated June 13, 2013
bearing interest at 4% per annum, due June 13, 2014. 20,000
Unsecured promissory note payable, dated October 7, 2013
bearing interest at 4% per annum, due October 7, 2014. 10,000
Unsecured promissory note payable, dated December 18, 2013
bearing interest at 4% per annum, due December 18, 2014. 5,000
Unsecured promissory note payable, dated February 19, 2014
bearing interest at 4% per annum, due February 19, 2015. 5,000
--------
$120,000
========
18
INTEGRATED ELECTRIC SYSTEMS CORP.
(A Development Stage Company)
Notes to Financial Statements
As at March 31, 2014
--------------------------------------------------------------------------------
NOTE 5 - NOTES PAYABLE (CONTINUED)
Interest expense incurred under debt obligations amounted to $4,114 and $1,337
for the years ended March 31, 2014 and 2013, respectively. Accrued interest was
$5,450 and $1,337 as of March 31, 2014 and March 31, 2013, respectively.
NOTE 6 - GOING CONCERN
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As shown in the accompanying financial
statements, the Company has no sales and has incurred a net loss of $184,618
since inception. The future of the Company is dependent upon its ability to
obtain financing and upon future profitable operations from any business the
Company engages in. The financial statements do not include any adjustments
relating to the recoverability and classifications of recorded assets, or the
amounts of and classification of liabilities that might be necessary in the
event the Company cannot continue in existence.
NOTE 7 - INCOME TAX
We did not provide any current or deferred U.S. federal income tax provision or
benefit for any of the periods presented because we have experienced operating
losses since inception. When it is more likely than not that a tax asset cannot
be realized through future income the Company must allow for this future tax
benefit. We provided a full valuation allowance on the net deferred tax asset,
consisting of net operating loss carryforwards, because management has
determined that it is more likely than not that we will not earn income
sufficient to realize the deferred tax assets during the carryforward period.
The Company has not taken a tax position that, if challenged, would have a
material effect on the financial statements for the twelve-months ended March
31, 2014 and 2013, or during the prior three years applicable under FASB ASC
740. We did not recognize any adjustment to the liability for uncertain tax
position and therefore did not record any adjustment to the beginning balance of
accumulated deficit on the balance sheets. The Company is in the process of
filing appropriate returns for the Company.
The component of the Company's deferred tax assets as of March 31, 2014 and 2013
are as follows:
2014 2013
-------- --------
Net operating loss carry forward $ 64,616 $ 46,730
Valuation allowance (64,616) (46,730)
-------- --------
Net deferred tax asset $ -- $ --
======== ========
19
INTEGRATED ELECTRIC SYSTEMS CORP.
(A Development Stage Company)
Notes to Financial Statements
As at March 31, 2014
--------------------------------------------------------------------------------
NOTE 7 - INCOME TAX (CONTINUED)
A reconciliation of income taxes computed at the 35% statutory rate to the
income tax recorded is as follows:
Since
2014 2013 Inception
-------- -------- ---------
Net operating loss carry forward $ 17,936 $ 12,252 $ 64,616
Valuation allowance (17,936) (12,252) (64,616)
-------- -------- --------
Net deferred tax asset $ -- $ -- $ --
======== ======== ========
The Company did not pay any income taxes during the periods ended March 31, 2014
and since inception.
The net federal operating loss carry forward will expire from 2027 and 2034.
This carry forward may be limited upon the consummation of a business
combination under IRC Section 381.
20
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON FINANCIAL DISCLOSURE
We have had no disagreements on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedures with
our accountants for the year ended March 31, 2014 or any interim period.
We have not had any other changes in nor have we had any disagreements, whether
or not resolved, with our accountants on accounting and financial disclosures
during our two recent fiscal years or any later interim period.
ITEM 9A. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
Under the supervision and with the participation of our management, including
our principal executive officer and the principal financial officer (our
president), we have conducted an evaluation of the effectiveness of the design
and operation of our disclosure controls and procedures, as defined in Rules
13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as of the
end of the period covered by this report. Based on this evaluation, our
principal executive officer and principal financial officer concluded as of the
evaluation date that our disclosure controls and procedures were effective such
that the material information required to be included in our Securities and
Exchange Commission reports is accumulated and communicated to our management,
including our principal executive and financial officer, recorded, processed,
summarized and reported within the time periods specified in Securities and
Exchange Commission rules and forms relating to our company, particularly during
the period when this report was being prepared.
MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our management is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in Rules 13a-15(f) and
15d-15(f) under the Exchange Act, for the company.
Internal control over financial reporting includes those policies and procedures
that: (1) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of our 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 our receipts and expenditures are being made
only in accordance with authorizations of its 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 the financial statements.
Management recognizes that there are inherent limitations in the effectiveness
of any system of internal control, and accordingly, even effective internal
control can provide only reasonable assurance with respect to financial
statement preparation and may not prevent or detect material misstatements. In
21
addition, effective internal control at a point in time may become ineffective
in future periods because of changes in conditions or due to deterioration in
the degree of compliance with our established policies and procedures.
A material weakness is a significant deficiency, or combination of significant
deficiencies, that results in there being a more than remote likelihood that a
material misstatement of the annual or interim financial statements will not be
prevented or detected.
Under the supervision and with the participation of our president, management
conducted an evaluation of the effectiveness of our internal control over
financial reporting, as of March 31, 2013, based on the framework set forth in
Internal Control-Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Based on our evaluation under
this framework, management concluded that our internal control over financial
reporting was not effective as of the evaluation date due to the factors stated
below.
Management assessed the effectiveness of the Company's internal control over
financial reporting as of evaluation date and identified the following material
weaknesses:
INSUFFICIENT RESOURCES: We have an inadequate number of personnel with requisite
expertise in the key functional areas of finance and accounting.
INADEQUATE SEGREGATION OF DUTIES: We have an inadequate number of personnel to
properly implement control procedures.
LACK OF AUDIT COMMITTEE & OUTSIDE DIRECTORS ON THE COMPANY'S BOARD OF DIRECTORS:
We do not have a functioning audit committee or outside directors on our board
of directors, resulting in ineffective oversight in the establishment and
monitoring of required internal controls and procedures.
Management is committed to improving its internal controls and will (1) continue
to use third party specialists to address shortfalls in staffing and to assist
the Company with accounting and finance responsibilities, (2) increase the
frequency of independent reconciliations of significant accounts which will
mitigate the lack of segregation of duties until there are sufficient personnel
and (3) may consider appointing outside directors and audit committee members in
the future.
Management, including our president, has discussed the material weakness noted
above with our independent registered public accounting firm. Due to the nature
of this material weakness, there is a more than remote likelihood that
misstatements which could be material to the annual or interim financial
statements could occur that would not be prevented or detected.
This annual report does not include an attestation report of our registered
public accounting firm regarding internal control over financial reporting.
Management's report was not subject to attestation by the our registered public
accounting firm pursuant to temporary rules of the SEC that permit us to provide
only management's report in this annual report.
22
CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING
There have been no changes in our internal control over financial reporting that
occurred during the last fiscal quarter for our fiscal year ended March 31, 2014
that have materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS
The officer and director of Integrated Electric Systems Corp., whose one year
term will expire 3/1/15, or at such a time as his successor(s) shall be elected
and qualified is as follows:
Name & Address Age Position Date First Elected Term Expires
-------------- --- -------- ------------------ ------------
Larry Segal 53 President, 10/20/2012 3/1/2015
16133 Ventura Blvd. Secretary,
Suite 700 Treasurer,
Encino, CA 91436 CFO, CEO &,
Director
The foregoing person is a promoter of Integrated Electric Systems Corp., as that
term is defined in the rules and regulations promulgated under the Securities
and Exchange Act of 1933.
Directors are elected to serve until the next annual meeting of stockholders and
until their successors have been elected and qualified. Officers are appointed
to serve until the meeting of the board of directors following the next annual
meeting of stockholders and until their successors have been elected and
qualified.
BACKGROUND INFORMATION FOR LARRY SEGAL
Mr. Segal has over 25 years of broad-based business experience from start-ups to
Fortune 500 companies, including: co-founding International Mari-Culture
Technologies, Ltd. (New York, NY) and Aqua-Culture Technologies, Ltd. (New York,
NY) and founding Matanzas Media (Nashville, TN and Los Angeles, CA).
Aqua-Culture Technologies, Ltd. was formed to build and maintain large-scale
fish farms for the purpose of creating a renewable food source in developing
nations. Matanzas Media developed promotions and events for high-profile
destinations, and its clients included the Las Vegas Hilton and the La Quinta
Resort & Club. Mr. Segal has also worked extensively in the film industry for
such entities as Twentieth Century Fox, Paramount Pictures, Tri-Star Pictures,
and Walt Disney Studios. He also served as a consultant to WorldCup USA 1994.
Mr. Segal also has extensive legal experience in both the film industry and
civil litigation, and served as an office of a publicly traded company (Razor
Resources, Inc.) in 2011.
23
EXPERIENCE:
MATANZAS MEDIA Nashville, TN & Los Angeles, CA
Founder, President/CEO 1989 - present
Matanzas Media was originally created to create a rival to Zagat's Restaurant
Guides and has evolved over the years into a promotions and events for
high-profile destinations, and its clients included KIIS-FM (the highest-rated
radio station in the U.S.), the Las Vegas Hilton, and the La Quinta Resort &
Club. Matanzas Media also worked with the La Quinta Resort & Club to develop a
celebrity golf event to replace the Raymond Floyd Lexus Challenge, as well as to
create an annual charity event to benefit the Billie Jean King Foundation.
RAZOR RESOURCES, INC. Los Angeles, CA
Director January 2011 - October 2011
Primarily responsible for reviewing analysts' research and consultants' reports
and drafting related public relations statements.
BUILDING CAPITAL, INC. Palm Springs, CA
Branch Office Manger January 2005 - December 2008
Building Capital, Inc. is/was a Los Angeles-based commercial and residential
mortgage broker and he owned and operated the Palm Springs, California branch.
AQUA-CULTURE TECHNOLOGIES, LTD. New York, NY
Co-founder, Vice President 1986-1987
Successor corporation to International Mari-Culture Technologies, Ltd.
INTERNATIONAL MARI-CULTURE TECHNOLOGIES, LTD. New York, NY
Co-founder, Corporate Secretary 1984-1986
International Mari-Culture Technologies, Ltd. IMT was formed to build and
maintain large-scale fish farms (I.E., catfish) for the purpose of creating a
renewable food source in developing nations. At its zenith, International
Mari-Culture Technologies, Ltd. had over $2 billion in letters of intent from
its nation clients.
EDUCATION
UNIVERSITY OF FLORIDA Gainesville, Florida
Bachelor of Arts in American Literature. 1978-1984, 1987
Concentrations in Creative Writing and Film Studies, with a minor in Economics.
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
No executive officer or director of the corporation has been the subject of any
order, judgment, or decree of any court of competent jurisdiction, or any
24
regulatory agency permanently or temporarily enjoining, barring, suspending or
otherwise limiting him or her from acting as an investment advisor, underwriter,
broker or dealer in the securities industry, or as an affiliated person,
director or employee of an investment company, bank, savings and loan
association, or insurance company or from engaging in or continuing any conduct
or practice in connection with any such activity or in connection with the
purchase or sale of any securities.
No executive officer or director of the corporation has been convicted in any
criminal proceeding (excluding traffic violations) or is the subject of a
criminal proceeding which is currently pending.
CONFLICT OF INTEREST
Our Officer and Director does not currently devote all of his business time to
our operations.
CODE OF ETHICS
We do not currently have a code of ethics, because we have only limited business
operations and only two officers and directors, we believe a code of ethics
would have limited utility. We intend to adopt such a code of ethics as our
business operations expand and we have more directors, officers and employees.
ITEM 11. EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
Change in
Pension
Value and
Non-Equity Nonqualified
Incentive Deferred All
Name and Plan Compen- Other
Principal Stock Option Compen- sation Compen-
Position Year Salary Bonus Awards Awards sation Earnings sation Totals
------------ ---- ------ ----- ------ ------ ------ -------- ------ ------
Larry Segal, 2013 30,500 0 0 0 0 0 0 0
CEO, 2012 5,000 0 0 0 0 0 0 0
President,
Director
25
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
Option Awards Stock Awards
----------------------------------------------------------------- ----------------------------------------------
Equity
Incentive
Equity Plan
Incentive Awards:
Plan Market or
Awards: Payout
Equity Number of Value of
Incentive Number Unearned Unearned
Plan Awards; of Market Shares, Shares,
Number of Number of Number of Shares Value of Units or Units or
Securities Securities Securities or Units Shares or Other Other
Underlying Underlying Underlying of Stock Units of Rights Rights
Unexercised Unexercised Unexercised Option Option That Stock That That That
Options (#) Options (#) Unearned Exercise Expiration Have Not Have Not Have Not Have Not
Name Exercisable Unexercisable Options (#) Price Date Vested(#) Vested Vested Vested
---- ----------- ------------- ----------- ----- ---- --------- ------ ------ ------
Larry Segal 0 0 0 0 0 0 0 0 0
DIRECTOR COMPENSATION
Change in
Pension
Value and
Fees Non-Equity Nonqualified
Earned Incentive Deferred
Paid in Stock Option Plan Compensation All Other
Name Cash Awards Awards Compensation Earnings Compensation Total
---- ---- ------ ------ ------------ -------- ------------ -----
Larry Segal 0 0 0 0 0 0 0
There are no current employment agreements between the company and its executive
officer.
Mr. Segal currently devotes approximately 3 hours each per week to manage the
affairs of the company. He has agreed to work with no remuneration until such
time as the company receives sufficient revenues necessary to provide management
salaries. At this time, we cannot accurately estimate when sufficient revenues
will occur to implement this compensation, or what the amount of the
compensation will be.
There are no annuity, pension or retirement benefits proposed to be paid to
officers, directors or employees in the event of retirement at normal retirement
date pursuant to any presently existing plan provided or contributed to by the
company or any of its subsidiaries, if any.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information on the ownership of Integrated
Electric Systems Corp. voting securities by officers, directors and major
shareholders as well as those who own beneficially more than five percent of our
common stock:
26
Name of No. of Percentage
Beneficial Owner (1) Shares of Ownership
-------------------- ------ ------------
Larry Segal (1) 0 0%
All Officers and
Directors as a Group 0 0%
Damian O'Hara 1,900,000 35%
Nicole O'Hara 1,500,000 27%
----------
(1) The person named may be deemed to be a "parent" and "promoter" of the
Company, within the meaning of such terms under the Securities Act of 1933,
as amended.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On March 5, 2007, a total of 1,000,000 shares of Common Stock were issued to Mr.
and Mrs. O'Hara in exchange for $5,000 US, or $.005 per share. On March 29, 2007
a total of 1,400,000 shares were issued to Damian O'Hara in repayment of $7,000
he paid on behalf of the company for the acquisition of the mining claims. On
July 3, 2007, Nicole O'Hara purchased 1,000,000 shares of our common stock for
$5,000 ($0.005 per share). All of such shares are "restricted" securities, as
that term is defined by the Securities Act of 1933, as amended, and are held by
an officer and director of the Company. (See "Principal Stockholders".)
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The total fees charged to the company for audit services were $8,950 for
audit-related services were $Nil, for tax services were $Nil and for other
services were $Nil during the year ended March 31, 2014.
The total fees charged to the company for audit services were $9,800 for
audit-related services were $Nil, for tax services were $Nil and for other
services were $Nil during the year ended March 31, 2013.
27
PART IV
ITEM 15. EXHIBITS
The following exhibits are included with this filing. Those marked with an
asterisk and required to be filed herehunder, are incorporated by reference can
be found in their entirety in our original SB-2 Registration Statement filed
under SEC File Number 333-144840, at the SEC website at www.sec.gov:
Exhibit
Number Description
------ -----------
* 3(i) Articles of Incorporation
* 3(ii) Bylaws
31 Sec. 302 Certification of CEO/CFO
32 Sec. 906 Certification of CEO/CFO
101 Interactive data files pursuant to Rule 405 of Regulation S-T
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe it meets all of
the requirements for filing Form 10-K and authorized this report to be signed on
its behalf by the undersigned, in the city of Encino, CA, on June 23, 2014.
Integrated Electric Systems Corp., Registrant
/s/ Larry Segal
---------------------------------------------
By: Larry Segal, President & Director
(Chief Executive Officer, Principal Financial
Officer & Principal Accounting Officer)
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
/s/ Larry Segal June 23, 2014
--------------------------------- -------------
Larry Segal, President & Director Date
(Chief Executive Officer,
Principal Financial Officer,
Principal Accounting Officer)
28