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EXCEL - IDEA: XBRL DOCUMENT - Seals Entertainment Corp | Financial_Report.xls |
EX-31 - EXHIBIT 31 - Seals Entertainment Corp | v307724_ex31.htm |
EX-32 - EXHIBIT 32 - Seals Entertainment Corp | v307724_ex32.htm |
EX-3.2 - EXHIBIT 3.2 - Seals Entertainment Corp | v307724_ex3-2.htm |
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL
REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2011
Commission File Number: 333-152376
GLOBAL SMART ENERGY, INC. | ||
( FORMERLY TRIANGLE ALTERNATIVE NETWORK INCORPORATED) | ||
(Exact name of Company as specified in its charter) | ||
DELAWARE | 26-2691611 | |
(State or other Jurisdiction of | (IRS Employer | |
of Incorporation or Organization) | Identification No.) | |
3340 Peachtree Road, N.E., Suite 1800, Atlanta, GA | 30326 | |
(Address of principal executive offices) | (Zip Code) | |
(404) 230-9600 | ||
(Issuer’s telephone number, including area code) |
Securities registered under Section 12(b) of the Exchange Act: None
Securities registered under Section 12(g) of the Exchange Act: Common Stock, $0.005 par value per share
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 15(d) of the Exchange Act. Yes ¨ No x
Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Exchange Act from their obligations under those Sections.
Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
x Yes ¨ No
Indicate by check mark if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-K contained in this form, and no disclosure will be contained, to the best of registrant’s knowledge, in definitive proxy information statements incorporated by reference in Part III of this Form 10-K or any amendment to 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 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 | £ | Smaller Reporting Company | S |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes x No ¨
State 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.
The aggregate market value of the voting and non-voting common equity on June 30, 2011 held by non-affiliates of the registrant is not applicable as the Company has not yet achieved trading status.
Note.—If a determination as to whether a particular person or entity is an affiliate cannot be made without involving
unreasonable effort and expense, the aggregate market value of the common stock held by non-affiliates may be calculated on the basis of assumptions reasonable under the circumstances, provided that the assumptions are set forth in this Form.
APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. ¨ Yes ¨ No
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.
As of March 30, 2012, there were 13,184,410 shares of the registrant’s Common Stock outstanding.
Table of Contents
PART I. | ||
Item 1. | Business | 3 |
Item 1A. | Risk Factors | 4 |
Item 1B. | Unresolved Staff Comments | |
Item 2. | Properties | 4 |
Item 3. | Legal Proceedings | 4 |
Item 4. | Mine Safety Disclosures | 4 |
PART II. | ||
Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
4 |
Item 6. | Selected Financial Data | 6 |
Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 6 |
Item 7A. | Quantitative and Qualitative Disclosures About Market Risk | 6 |
Item 8. | Financial Statements and Supplementary Data | 7 |
Item 9. | Changes In and Disagreements With Accountants on Accounting and Financial Disclosure | 17 |
Item 9A | Controls and Procedures | 17 |
Item 9B. | Other Information | 18 |
PART III. | ||
Item 10. | Directors, Executive Officers and Corporate Governance | 18 |
Item 11. | Executive Compensation | 21 |
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 23 |
Item 13. | Certain Relationships and Related Transactions and Director Independence | 24 |
Item 14. | Principal Accountant Fees and Services | 24 |
PART IV. |
||
Item 15. | Exhibits | 24 |
2 |
PART I.
FORWARD LOOKING STATEMENTS
This annual report contains certain forward-looking statements and for this purpose any statements contained in this annual report that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, words such as "may," "will," "expect," "believe," "anticipate," "estimate" or "continue" or comparable terminology are intended to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainties, and actual results may differ materially depending on a variety of factors, many of which are not within our control. These factors include but are not limited to economic conditions generally and in the markets in which the Company may participate, competition within the Company’s chosen industry, technological advances and failure by us to successfully develop business relationships.
ITEM 1. | DESCRIPTION OF BUSINESS . |
(a) | Business Development |
Global Smart Energy, Inc. (formerly Triangle Alternative Network Incorporated) (“GSEI”) is a development stage company that was incorporated in the state of Delaware on April 1, 2008 and was the holding company for Triangle Alternative Network, LLC (“TAN, LLC” and, together with GSEI., "GSEI", the "Company", "we", "us" or "our"). We are a start-up company that was originally organized to develop a television network to provide programming to the Gay, Lesbian, Bi-Sexual and Trans-gender (“GLBT”) Community.
After attempting to develop programming, it was determined that the company did not want to develop this particular programming and had not entered into a definitive contract to sell the programming. The film and production costs were transferred to related parties in exchange for the debt owed to them for advances to the Company.
(b) Business of Issuer
GSEI was incorporated in the State of Delaware on April 1, 2008 under the name of Triangle Alternative Network, Inc. The Company officially changed its name to Global Smart Energy, Inc. on February 8, 2011. GSE has no full time employees. Our principal executive offices are located at 3340 Peachtree Road, N.E., Atlanta, GA and our telephone number is (404) 230-9600.
Effective October 2, 2011 in a special meeting of the Board of Directors, E. Lamar “Lou” Seals, III was elected as Chairman of the Board of Directors and CEO of the Company to be effective October 22, 2001. Frank O’Donnell, CEO and Director, Lyle Mortensen CFO and Director and Gerry Shirren, Director resigned for personal reasons and had no disagreements with the Company. Prior to resignation the Board of Directors elected E. Lamar Seals, III and John W. Bonner, Jr. as directors to replace them until further action by a majority of the shareholders.
We presently have no employees. Our officers and directors are engaged in outside business activities and we anticipate they will devote to our business very limited time until the acquisition of a successful business opportunity has been consummated. We expect no significant changes in the number of our employees other than such changes, if any, incident to a business combination.
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(c) Reports to security holders
(1) The Company is not required to deliver an annual report to security holders and at this time does not anticipate the distribution of such a report.
(2) The Company will file reports with the SEC. The Company is currently a reporting company and will comply with the requirements of the Exchange Act.
(3) The public may read and copy any materials the Company files with the SEC at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC- 0330. Additionally, the SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, which can be found at http://www.sec.gov.
Patent and Trademarks
We currently do not own any patents, trademarks or licenses of any kind.
Government Regulations
There are no government approvals necessary to conduct our current business.
Employees
We presently have no employees apart from our management.
ITEM 1A. RISK FACTORS
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
ITEM 2. DESCRIPTION OF PROPERTY
Our headquarters are located at 3340 Peachtree Road, N.E., Atlanta, GA. At the current time the Company shares office space in the office of the current CEO and is not charged rent due to a lack of operations.
ITEM 3. LEGAL PROCEEDINGS
We are not a party to any material legal proceedings and there are no material legal proceedings pending with respect to our property. We are not aware of any legal proceedings contemplated by any governmental authorities involving either us or our property. None of our directors, officers or affiliates is an adverse party in any legal proceedings involving us or our subsidiaries, or has an interest in any proceeding which is adverse to us or our subsidiaries.
ITEM 4. MINE SAFETY DISCLOSURES.
Not Applicable.
PART II.
ITEM 5. MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
Market Information
The Company’s common stock is not actively trading as of December 31, 2011.
Holders of Our Common Stock
As of March 30, 2011, we had 71 stockholders of record based on Company information and provided by our transfer agent and as authorized by the Company.
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Dividends
We have not declared or paid cash dividends on our common stock since our inception. We intend to retain all future earnings, if any, to fund the operation of our business, and, therefore, do not anticipate paying dividends in the foreseeable future. Future cash dividends, if any, will be determined by our board of directors.
Issuer Purchases of Equity Securities
There were no stock repurchases during the year ended December 31, 2011.
Recent Sales of Unregistered Securities
On March 8, 2011 the Board of the Directors authorized the issue of its common stock to the officers and directors that have been serving without compensation in the following amounts:
Lyle J. Mortensen, former CEO and director (1) | 200,000 shares |
Gerry Shirren, former CFO and director (1) | 75,000 shares |
Tiffany Kalahiki, former secretary and director (2) | 25,000 shares |
(1) resigned from all positions with the Company on October 21, 2011.
(2) resigned from all positions with the Company on January 13, 2011.
The Company also approved the issuance of 1,676,160 shares at $0.045 per share for the cancellation of the unsecured advances owed by the Corporation to its majority shareholder in the amount of $75,427.15 effective March 17, 2011.
On December 23, 2011, the Board of Directors authorized the issuance of 6,000,000 shares in conversion of a $30,000 Convertible promissory that was issued on October 21, 2011.
On December 23, 2011, Emmett Lamar Seals, III converted a Convertible Promissory Note in the amount of $30,000.00 to 6,000,000 shares of the Company’s common stock.
On February 16, 2012, the Company issued 1,000,000 shares of its common stock to Teresa Vellardita, designee of Vince Vellardita and 1,000,000 shares to Emmett Lamar Seals, III for services rendered.
All of the above offerings and sales were deemed to be exempt under either rule 506 of Regulation D and Section 4(2) or Rule 902 of Regulation S of the Securities Act of 1933, as amended.
5 |
ITEM 6. SELECTED FINANCIAL DATA
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis is intended as a review of significant factors affecting our financial condition and results of operations for the periods indicated. The discussion should be read in conjunction with our consolidated financial statements and the notes presented herein. In addition to historical information, the following Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results could differ significantly from those anticipated in these forward-looking statements as a result of certain factors discussed in this annual report.
A. | Management’s Plan of Operation |
The following discussion of our financial condition, changes in financial condition and results of operations for the year ended December 31, 2011 should be read in conjunction with our audited financial statements and related notes for the year ended December 31, 2011.
The analysis of new business opportunities will be undertaken by or under the supervision of the officers and directors of the Company. The Company has unrestricted flexibility in seeking, analyzing and participating in potential business opportunities
RESULTS OF OPERATIONS
For the year ended December 31, 2011 compared to the period ended December 31, 2010
From our inception on May 23, 2007, (inception) to December 31, 2011, we have generated no revenue. We earned no revenues during the twelve month period ended December 31, 2011 and no revenues for the period ended December 31, 2010.
Operating expenses for the twelve months ended December 31, 2011 totaled $118,844, resulting in an increase of 519% percent from the comparable period of 2010. This increase resulted primarily from the fact that administrative expenses increased in preparation of possible acquisitions, which were not accomplished. The operations taking place prior to September 30, 2008 have been discontinued, and are classified in the financial statements as such.
We incurred a net loss of $122,410 during the twelve month period ended December 31, 2011, resulting in an increase in the loss of approximately 537% from the loss of $19,212 for the period ended December 31, 2010. Basic net loss per share from continuing operations was $0.02 for the twelve month period ended December 31, 2011, compared to $0.01 for the comparable period of 2010.
Liquidity and Capital Resources
As of December 31, 2011, we had a negative working capital of $16,949 compared to a negative working capital of $92,581at December 31, 2010. The change of $75,632 or 81.7% in working capital resulted primarily from the conversion of a related party payable into common stock.
During the twelve months ended December 31, 2011 we experienced negative cash flow of $100,030 from operating activities. We recognized positive cash flow from financing activities, relating to contributions to capital, proceeds from share issuance, repayments to and conversion from related party loans, in the amount of $99,855.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
6 |
ITEM 8. FINANCIAL STATEMENTS.
CERTIFIED PUBLIC ACCOUNTANTS & CONSULTANTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
Global Smart Energy, Inc
We have audited the accompanying balance sheets of Global Smart Energy, Inc (A Development Stage Company) as of December 31, 2011 and 2010 and the related statements of operations, stockholders’ equity (deficit), and cash flows for the years then ended and from inception (May 23, 2007) to December 31, 2011. 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 audits.
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 audits 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 audit 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 the financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, 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 Global Smart Energy, Inc (A Development Stage Company) as of December 31, 2011 and 2010 and the results of its operation and its cash flow for the years then ended and from inception (May 23, 2007) to December 31, 2011, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 4 to the financial statements, the Company has suffered recurring losses from operations, which raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 4. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
De Joya Griffith & Company, LLC
/s/ De Joya Griffith & Company, LLC
Henderson, Nevada
March 30, 2012
Global Smart Energy, Inc.
(A Development Stage Company)
Balance Sheet
(Audited)
December 31, | ||||||||
2011 | 2010 | |||||||
Assets | ||||||||
Cash and Cash Equivalents | $ | 80 | $ | 255 | ||||
Prepaid Expenses | 3,000 | |||||||
Total Current Assets | 80 | 3,255 | ||||||
Total assets | $ | 80 | $ | 3,255 | ||||
Liabilities And Stockholders' Deficit | ||||||||
Accounts payable And Accrued Expenses | $ | 5,175 | $ | 20,409 | ||||
Related Party Payable | 11,855 | 75,427 | ||||||
Total Current Liabilities | 17,030 | 95,836 | ||||||
Total Liabilities | 17,030 | 95,836 | ||||||
Stockholders' Deficit | ||||||||
Common Stock 50,000,000 shares authorised at par value of $ 0.005, 11,184,410 shares and 3,208,250 shares issued and outstanding, respectively | 55,922 | 16,041 | ||||||
Additional Paid in Capital | 221,369 | 63,209 | ||||||
Accumulated Deficit from Development Stage | (294,241 | ) | (171,831 | ) | ||||
Total Stockholders' deficit | (16,950 | ) | (92,581 | ) | ||||
Total Liabilities & Stockholders' Deficit | $ | 80 | $ | 3,255 |
The accompanying notes are an integral part of these financial statements
7 |
Global Smart Energy, Inc.
(A Development Stage Company)
Statement of Operations
(Audited)
From Inception | ||||||||||||
For the Year Ended | (May 23, 2007) | |||||||||||
December 31, | Through | |||||||||||
2011 | 2010 | December 31, 2011 | ||||||||||
Revenues | $ | - | $ | - | $ | - | ||||||
Compensation - O & D | 53,500 | 53,500 | ||||||||||
Professional Fees | 47,970 | 47,970 | ||||||||||
General and Administrative | 17,374 | 19,212 | 189,204 | |||||||||
Total Operating Expenses | 118,844 | 19,212 | 290,674 | |||||||||
Loss from Operations | (118,844 | ) | (19,212 | ) | (290,674 | ) | ||||||
Other Income/ (Expense) | ||||||||||||
Interest expense | (3,566 | ) | (3,566 | ) | ||||||||
Net Loss | $ | (122,410 | ) | $ | (19,212 | ) | $ | (294,241 | ) | |||
Basic Loss per Commmon Share | $ | (0.02 | ) | $ | (0.01 | ) | ||||||
Weighted Average No. of | ||||||||||||
Common Shares Outstanding | 4,933,692 | 3,208,250 |
The accompanying notes are an integral part of these financial statements
8 |
Global Smart Energy, Inc.
(A Development Stage Company)
Statement of Stockholders' Deficit
(From Inception May 23, 2007 to December 31, 2011)
(Audited)
Deficit Accumulated | ||||||||||||||||||||
Additional | During the | Total | ||||||||||||||||||
Common Stock | Paid-In | Development | Stockholders' | |||||||||||||||||
Shares | Amount | Capital | Stage | Deficit | ||||||||||||||||
Balance, May 23, 2007 | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
Common stock issued for services at $0.075 per share | 5,000,000 | 25,000 | 50,000 | - | 75,000 | |||||||||||||||
Net loss for the year ended | ||||||||||||||||||||
December 31, 2007 | - | - | - | (85,762 | ) | (85,762 | ) | |||||||||||||
Balance, December 31, 2007 (audited) | 5,000,000 | 25,000 | 50,000 | (85,762 | ) | (10,762 | ) | |||||||||||||
Common stock cancelled | (2,216,750 | ) | (11,084 | ) | 11,084 | - | - | |||||||||||||
Common stock issued for services at $0.01 per share | 200,000 | 1,000 | 1,000 | - | 2,000 | |||||||||||||||
Net loss for the year ended | ||||||||||||||||||||
December 31, 2008 | - | - | - | (29,370 | ) | (29,370 | ) | |||||||||||||
Balance, December 31, 2008 (audited) | 2,983,250 | 14,916 | 62,084 | (115,132 | ) | (38,132 | ) | |||||||||||||
Common stock issued for services at $0.01 per share | 225,000 | 1,125 | 1,125 | - | 2,250 | |||||||||||||||
Net loss for the twelve months | ||||||||||||||||||||
ended December 31, 2009 | - | - | - | (37,487 | ) | (37,487 | ) | |||||||||||||
Balance, December 31, 2009 (audited) | 3,208,250 | 16,041 | 63,209 | (152,619 | ) | (73,369 | ) | |||||||||||||
Net loss for the twelve months | ||||||||||||||||||||
Ended December 31, 2010 | - | - | - | (19,212 | ) | (19,212 | ) | |||||||||||||
Balance, December 31, 2010 (audited) | 3,208,250 | 16,041 | 63,209 | (171,831 | ) | (92,581 | ) | |||||||||||||
Common Stock issued for Services | ||||||||||||||||||||
At $0.045 per share | 300,000 | 1,500 | 12,000 | - | 13,500 | |||||||||||||||
Common Stock issued for settlement of related party payables at $0.045 per share | 1,676,160 | 8,381 | 67,046 | - | 75,427 | |||||||||||||||
Common Stock issued for settlement of related party advances at 0.005 per share | 6,000,000 | 30,000 | 30,000 | |||||||||||||||||
Settlement of note payable and treated as additional paid-in capital | 61,551 | 61,551 | ||||||||||||||||||
Reversal of amount payable to shareholder of the company, amount has to be credited to additional paid-in capital | 17,563 | 17,563 | ||||||||||||||||||
Net Loss for the year ended 31-Dec-11 | - | - | - | (122,410 | ) | (122,410 | ) | |||||||||||||
Balance, December 31, 2011(audited) | 11,184,410 | $ | 55,922 | $ | 221,369 | $ | (294,241 | ) | $ | (16,950 | ) |
The accompanying notes are an integral part of these financial statements
9 |
Global Smart Energy, Inc.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Audited)
For the period from | ||||||||||||
May 23, 2007 | ||||||||||||
For the year ended December 31, | (Date of Inception) | |||||||||||
2011 | 2010 | to December 31, 2011 | ||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||||||
Net loss | $ | (122,410 | ) | $ | (19,212 | ) | $ | (294,241 | ) | |||
Adjustment to reconcile net loss to net | ||||||||||||
cash used by operating activities | ||||||||||||
Interest | 3,550 | - | 3,550 | |||||||||
Common Stock issued for services | 13,500 | 92,750 | ||||||||||
Changes in operating assets and liabilities: | ||||||||||||
Changes in Accounts Payable | 2,330 | 349 | 22,739 | |||||||||
Change in Current Assets | 3,000 | (3,000 | ) | - | ||||||||
NET CASH USED IN OPERATING ACTIVITIES | (100,030 | ) | (21,863 | ) | (175,202 | ) | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||||||
Proceeds from related party loans | 11,855 | 22,000 | 87,282 | |||||||||
Proceeds from Share Issuance | 230,000 | - | 230,000 | |||||||||
Additional Capital Contributed | (142,000 | ) | - | (142,000 | ) | |||||||
NET CASH PROVIDED BY FINANCING ACTIVITIES | 99,855 | 22,000 | 175,282 | |||||||||
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (175 | ) | 137 | 80 | ||||||||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 255 | 118 | $ | - | ||||||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 80 | $ | 255 | $ | 80 | ||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOWS | ||||||||||||
INFORMATION | ||||||||||||
Interest paid | $ | - | $ | - | $ | 625 | ||||||
Income taxes paid | $ | - | $ | - | $ | - | ||||||
Shares issued to settle related party payables | $ | 105,427 | $ | - | $ | 105,427 | ||||||
Settlement of related party payables and recorded as additional paid-in capital | $ | 79,114 | $ | - | $ | 79,114 |
The accompanying notes are an integral part of these financial statements.
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GLOBAL SMART ENERGY, INC.
(A Development Stage Company)
Notes to Financial Statements
(Audited)
1. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Nature of Business
Triangle Alternative Network Inc. (TAN, Inc.) was incorporated in the State of Delaware on April 1, 2008. TAN, Inc. was a holding company for and operated through its wholly owned subsidiary Triangle Alternative Networks LLC, (TAN, LLC) a limited liability company organized in the State of Florida on May 23, 2007. TAN LLC was organized to engage in the business of producing and broadcasting television programming which focuses on the GLBT (Gay-Bi-Sexual-Transgender) community. During 2008, the Company discontinued the pursuit of the original business plans of TAN LLC. The Company has not realized significant revenues as of December 31, 2011 and is classified as a development stage enterprise in accordance with ASC Topic 915.
On February 8, 2011, pursuant to a shareholder meeting on January 10, 2011 the Company changed its name to Global Smart Energy, Inc. (the “Company”).
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Basic (Loss) per Share
Basic (loss) per share is calculated by dividing the Company’s net loss applicable to the weighted average number of shares outstanding during the period. Diluted earnings per share are calculated by dividing the Company’s net income available to shareholders by the diluted weighted average number of shares outstanding during the period. The diluted weighted average number of shares outstanding is the basic weighted average number of shares outstanding adjusted for any potentially dilutive debt or equity. There are no such shares outstanding as of December 31, 2011 and December 31, 2010.
For the Year | For the Year | |||||||
Ended | Ended | |||||||
December 31, | December 31, | |||||||
2011 | 2010 | |||||||
Loss (numerator) | $ | (122,410 | ) | $ | (19,212 | ) | ||
Units (denominator) | 4,933,692 | 3,208,250. | ||||||
Per share amount | $ | (0.02 | ) | $ | (0.01 | ) |
Dividends
The Company has not adopted any policy regarding payment of dividends. No dividends have been paid during any of the periods shown.
Comprehensive Income
The Company has no component of other comprehensive income. Accordingly, net income equals comprehensive income for the periods ended December 31, 2011 and December 31, 2010.
Advertising Costs
The Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred $-0- and $-0- of advertising expense during the periods ended December 31, 2011 and December 31, 2010, respectively.
11 |
GLOBAL SMART ENERGY, INC.
(A Development Stage Company)
Notes to Financial Statements
(Audited)
1. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) |
Cash and Cash Equivalents
The Company considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes.
Reclassifications
Certain amounts relating to the prior year’s financial statements have been reclassified to conform with the results of the current year presentation. These reclassifications had no effect on the previously reported results of operations or accumulated deficit.
Income Taxes
The Company provides for income taxes under ASC Topic 740, Accounting for Income Taxes. ASC Topic 740 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect when these differences are expected to reverse. The Company has elected to be taxed as a corporation for Federal and State income taxes.
ASC Topic 740 requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.
The provision for income taxes differs from the amounts which would be provided by applying the statutory federal income tax rate of 35% to the net loss before provision for income taxes for the following reasons:
Net deferred tax assets consist of the following components as of:
December 31, | December 31, | |||||||
2011 | 2010 | |||||||
NOL carryover | 294,241 | 171,831 | ||||||
Deferred tax asset | 102,984 | 60,141 | ||||||
Valuation allowance | (102,984 | ) | (60,141 | ) | ||||
Net deferred tax asset | $ | - | $ | - |
At December 31, 2011, the Company had deferred tax assets before offsetting valuation allowance calculated at an expected rate of 35% of approximately $102,984. At December 31, 2010, the Company had calculated deferred tax assets before offsetting valuation allowance calculated at an expected rate of 35% of approximately $60,141.
As management of the Company cannot determine that it is more likely than not that the Company will realize the benefit of its deferred tax assets, a valuation allowance equal to the deferred tax assets was recorded at the Company’s year-end financial reporting dates.
At December 31, 2011 and 2010 the Company had net operating loss carry forwards of approximately $294,241 and $171,831, respectfully, which will expire through the year 2031. The change in the valuation allowance from December 31, 2010 to December 31, 2011 is $42,843. This change is primarily due to the increase in the Company’s net operating loss carry forwards.
The valuation allowance will be evaluated at the end of each year, considering positive and negative evidence about whether the asset will be realized. At that time, the allowance will either be increased or reduced. Reduction could result in the complete elimination of the allowance if positive evidence indicates that the value of the deferred tax asset is no longer impaired and the allowance is no longer required.
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GLOBAL SMART ENERGY, INC.
(A Development Stage Company)
Notes to Financial Statements
(Audited)
1. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) |
Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of $294,240 for federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur net operating loss carry forwards may be limited as to use in future years.
Accounting Basis
The basis is accounting principles generally accepted in the United States of America. The Company has adopted a December 31 fiscal year end.
Stock-based compensation
The Company accounts for share based payments in accordance with ASC 718, Compensation – Stock Compensation, which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on the grant date fair value of the award. In accordance with ASC 718-10-30-9, Measurement Objective – Fair Value at Grant Date, the Company estimates the fair value of the award using a valuation technique. For this purpose, the Company uses the Black-Scholes option pricing model. The Company believes this model provides the best estimate of fair value due to its ability to incorporate inputs that change over time, such as volatility and interest rates, and to allow for actual exercise behavior of option holders. Compensation cost is recognized over the requisite service period which is generally equal to the vesting period. Upon exercise, shares issued will be newly issued shares from authorized common stock.
ASC 505, “Compensation-Stock Compensation”, establishes standards for the accounting for transactions in which an entity exchanges its equity instruments to non employees for goods or services. Under this transition method, stock compensation expense includes compensation expense for all stock-based compensation awards granted on or after January 1, 2006, based on the grant-date fair value estimated in accordance with the provisions of ASC 505.
Recent Accounting Pronouncements
The Company has evaluated the recent accounting pronouncements through ASU 2012-02 and believes that none of them will have a material effect on the company’s financial statements.
2. | COMMON STOCK |
On June 16, 2008, the Company completed a forward stock split of 5 shares for 1 increasing the total shares outstanding from 1,000,000 shares to 5,000,000 shares. During the year ended December 31, 2008, Mr. Grunberg resigned his position as a member of the Company’s Board of Directors and he returned all of his common stock to the Company. Likewise Mr. Altfeld resigned as Interim CEO and Mr. Pancoast as COO and their common stock shares were returned to the Company. A total of 2,224,250 shares were returned to the Company and cancelled as a result of these resignations and the discontinuation of TAN LLC.
In October, 2008, the Company issued 200,000 shares of common stock at $0.01 per share to a consultant for services performed.
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GLOBAL SMART ENERGY, INC.
(A Development Stage Company)
Notes to Financial Statements
(Audited)
In December, 2009, the Company issued 225,000 share of common stock at $0.01 per share to consultants for services performed.
On March 8, 2011 the Board of the Directors authorized the issue of its common shares to the officers and directors that had been serving without compensation in the following amounts:
Lyle J. Mortensen, former CEO and director 200,000 shares
Gerry Shirren, former CFO and director 75,000 shares
Tiffany Kalahiki, past secretary and director 25,000 shares
The Company approved the issue of 1,676,160 shares at $0.045 per share for the cancellation of the unsecured advances owed by the Company to its majority shareholder in the amount of $75,427.15.effective March 17, 2011.
On December 23, 2011 the Board of Directors authorized the issuance of 6,000,000 shares in conversion of a $30,000 Convertible promissory that was issued on October 21, 2011.
3. | RELATED PARTY PAYABLES |
All current expenses of the Company including purchase of property and equipment, production costs and expenses, advertising expenses, general and administrative expenses and interest expense have been paid with advances from a related party of the Company. The related party payables are non-interest bearing, unsecured, and due upon demand. At December 31, 2011 and 2010, the Company owed $11,855 and $75,427 respectively for these payables.
The Company approved the issue of 1,676,160 shares at $0.045 per share for the cancellation of the unsecured advances owed by the Corporation to its majority shareholder in the amount of $75,427 effective March 17, 2011.
4. | GOING CONCERN |
The accompanying financial statements have been prepared in conformity with generally accepted accounting principle, which contemplate continuation of the Company as a going concern. However, the Company has accumulated deficit of $294,241 as of December 31, 2011. The Company currently has limited liquidity, and has not established a stabilized source of revenues sufficient to cover operating costs over an extended period of time.
Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses. The Company intends to position itself so that it may be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.
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GLOBAL SMART ENERGY, INC.
(A Development Stage Company)
Notes to Financial Statements
(Audited)
5. | OTHER ITEMS |
The Company entered into a private transaction for a Private Placement of a Promissory note for $200,000 to assist in the financing of the Company on June 14, 2011. The Board of Directors assigned this liability and transferred $142,000 of cash in the Bank of America Account to a private company in Las Vegas that is a majority owned company by Frank O’Donnell and Lyle Mortensen. The private company agreed to hold Global Smart Energy, Inc. (Delaware) harmless for the deficit between the principal and accrued interest and the amount received in Cash from the Bank of America account.
On October 21, 2011 the Company entered into a private placement of a Convertible Promissory Note (the”Note”) in the amount of $30,000.00. The terms of the Note called for an election by the holder in due course to convert the promissory note into 6,000,000 shares of Common Stock of the Company. On December 15, 2011 the holder of the Note assigned all terms of the note to Seals Entertainment Company, LLC (Seals), which is owned by the current CEO and member of the Board of Directors, E. Lamar Seals, III. On December 23, 2011Seals elected to exercise his option and convert the promissory note into 6,000,000 shares of the Company’s Common Stock.
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GLOBAL SMART ENERGY, INC.
(A Development Stage Company)
Notes to Financial Statements
(Audited)
6. SUBSEQUENT EVENTS
By Written Consent on February 7, 2012, a majority of the shareholders authorized the Board of Directors to increase the Authorized Shares of Common Stock of the Company to 100,000,000 shares and to create a Preferred Class of Stock in the maximum amount of 200,000,000 shares.
On February 16, 2012, the Company issued 1,000,000 shares of common stock to Teresa Vellardita, designee of Vince Vellardita, and 1,000,000 shares of common stock to Emmett Lamar Seals, III for services.
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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
None.
ITEM 9A. CONTROLS AND PROCEDURES.
Disclosure Controls and Procedures
Based on an evaluation as of the date of the end of the period covered by report, our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as required by Exchange Act Rule 13a-15. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms.
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and our Chief Financial Officer, to allow timely decisions regarding required disclosure.
Management’s Annual Report on Internal Control Over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Exchange Act Rule 13a-15(f). Management conducted an evaluation of the effectiveness of the internal control over financial reporting as of December 31, 2010, using the criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
A material weakness is a control deficiency, or combination of control deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. As a result of management’s assessment, management has determined that there is a material weakness due to the lack of proper segregation of duties. In order to address and resolve this weakness we will endeavor to locate and appoint additional qualified personnel to the board of directors and pertinent officer positions as the Company operations increase.
This Annual Report does not include an attestation report of the company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the company to provide only management's report in this annual report
Changes in Internal Control Over Financial Reporting
There has been no change in our internal control over financial reporting that occurred during our last fiscal quarter (our fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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The term “internal control over financial reporting” is defined as a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the Company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
(a) Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company;
(b) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and
(c) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.
ITEM 9B. OTHER INFORMATION.
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS.
Identity of directors and executive officers
The following table sets forth information regarding our executive officers and directors. Each of our executive officers has been elected by our board of directors and serves until his or her successor is duly elected and qualified:
Name | Age | Position |
E. Lamar “Lou” Seals, III | 51 | President, Chief Executive Officer, Chief Financial Officer and Chairman of the Board of Directors |
John W. Bonner, Jr. | 43 | Executive Vice President and Treasurer and Director |
Edward A. Mearns III | 58 | Secretary and Director |
Frank A. O’Donnell (1) Lyle J Mortensen (1) |
59 72 |
Former Chief Executive Officer and Director Former Chief Executive Officer and Director |
Gerry Shirren (1) | 53 | Former Chief Financial Officer and Director |
Tiffany Kalahiki (2) | 39 | Former Secretary and Director |
(1) resigned from all positions with the Company on October 21, 2011.
(2) resigned from all positions with the Company on January 13, 2011.
The principal occupations and business experience for at least the past five years of each director and executive officer is as follows.
E. Lamar “Lou” Seals, III - Mr. Seals served as Chairman, Chief Executive Officer and President of Seals Communications Corporation, a media, marketing and television production company, from 1984 to 2006. In 1996, he founded Seals Communications Group, Inc. and served as Chairman, Chief Executive Officer and President from 1996 to 2008. He is currently the Chairman, Chief Executive Officer, President and Partner of TUFF TV Media Group, LLC, a digital broadcast network. He is also the Chairman, Chief Executive Officer and President of Seals Entertainment Company, LLC, a leading independent owner and producer of television programming. Mr. Seals attended Georgia State University.
John W. Bonner, Jr. - Mr. Bonner has served as the Chief Executive Officer and Director of Southeast Properties, Inc., a commercial real estate firm offering asset management, leasing and brokerage services, since 2006. He joined TUFF TV Media Group, LLC as a partner and Director in 2009. Mr. Bonner attended the University of Tennessee at Chattanooga.
Edward A. Mearns III - Mr. Mearns has served as the Chief Operating Officer and Director of Clarus Transphase Scientific, Inc., a technology company in the field of energy resonance, since 2008. He served as Counsel for The Health Network, Inc. from 2005 to 2008. Since 2005, Mr. Mearns has served as the Founder and Executive Director of the Action Sports Alliance, a non-profit organization representing professional female athletes. He has been Director of The Growing Institute since 2010. Mr. Means received a bachelor’s degree in English literature from Yale University in 1974. In 1979, he received a Juris Doctor degree from University of Virginia School of Law.
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Frank O’Donnell – Mr. O’Donnell is the CEO of a Private Nevada Company specializing in Energy related products and Vice-Chairman of TV compass and a founder of the Company. From 1996 to 2004, Mr. O’Donnell was the founder and President of Evolve Products, Inc. From 1986 to1995, he was the founder and Vice President of Universal Electronics, Inc. and from 1979 to 1986 he was the founder and President of Cable Business Associates, Inc. Further, he previously managed the custom designs for Time Warner Cable and Comcast (AT&T/TCI) universal remote controls. Mr. O’Donnell resigned from all positions with the Company on October 21, 2011.
Lyle J Mortensen- Mr. Mortensen is the owner and operator of Lyle J. Mortensen CPA, a consulting and accounting firm in practice since 1978. After graduation from Arizona State University, he worked for Touche Ross & Company in their Los Angeles, Phoenix, and Salt Lake City offices, serving as Director of Tax Operations (Salt Lake City office) from 1975 until 1978, when he established his private practice. Recently he served as the Chief Financial Officer for Advanced Growing Systems, Inc. from the date of inception through the registration process with the SEC and transition from a private company to a publicly held company that trades on the NASDAQ over the counter (Pink Sheets). He remains as an active member of the Board of Directors. His experience in accounting and consulting includes serving as the chief financial officer of an international investment banking firm; representing clients before the Internal Revenue Service, NASD, and other regulatory bodies; and preparing Securities and Exchange Commission documents. He has also functioned as the chief financial officer for several small companies, giving them financial and accounting structure and direction as needed. Mr. Mortensen resigned from all positions with the Company on October 21, 2011.
Gerry Shirren- Mr. Shirren is a Fellow of the Association of Certified Accountants FCCA and has been involved in the media industry for nearly 20 years. From 2006 to the present, Mr. Shirren has served as a financial consultant to U.S. companies involved in film, television, rights acquisitions and exploitation, bankruptcy turnarounds, corporate acquisition and financing. From June 2005 to March 2008, Mr. Shirren has served as Chief Executive Officer and joint managing Director of Digital Animation Media Limited, an Ireland-based company involved in the development production and exploitation of animation properties for film and television. From August 2005 to January 2008, Mr. Shirren has served as Chief Executive Officer and Director of Cambridge Animation Systems Limited, a United Kingdom based animation software tolls company with operations based in Ireland and the United Kingdom. From 1995 to June 2005, Mr. Shirren served as Chief Executive Officer and Joint Managing Director of TerraGlyph, which was initially the European Production center for the Chicago based TerraGlyph Interactive and subsequently became an independent film, television and interactive production studio. Mr. Shirren obtained his Business Diploma, with Honors, from the Athlone Institute of Technology in Ireland. Mr. Shirren resigned from all positions with the Company on October 21, 2011.
Tiffany Kalahiki- Ms. Kalahiki graduated cum laude from the University of Nevada in 2003 with a BS in Elementary Education. Since 2004, she has worked in the Clark County School District as a teacher and substitute teacher. Ms. Kalahiki has been the Vice President of ICAG, Inc., and Investment and Holding Company, since 1998. Since 2008, Ms. Kalahiki has served as Secretary of BPT, Inc. On January 13, 201, Ms. Kalahiki resigned for personal purposes and had no disagreements with the Company or its officers.
The Board believes that each of the Company’s directors is highly qualified to serve as a member of the Board. Each of the directors has contributed to the mix of skills, core competencies and qualifications of the Board.
None of our current directors hold or held any directorships during the past five years in other reporting companies. Presently, none of our directors is an “independent director” under the Corporate Governance Rules of the NASDAQ Stock Market, Inc., Rule 5605(a)(2). There are no family relationships among any of our directors or executive officers.
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Corporate Governance Guidelines
Our Board has long believed that good corporate governance is important to ensure that we are managed for the long-term benefit of our stockholders. Our common stock is not currently quoted on any listed exchange. However, our Board believes that the corporate governance rules of NASDAQ and AMEX represent good governance standards and, accordingly, during the past year, our Board has continued to review our governance practices in light of the Sarbanes-Oxley Act of 2002, the new rules and regulations of the Securities and Exchange Commission and the new listing standards of NASDAQ and AMEX, and it has implemented certain of the foregoing rules and listing standards during this past fiscal year.
Involvement in Certain Legal Proceedings |
During the last ten years, except as indicated below, no director, executive officer, promoter or control person of the Company has:
(1) Had a bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;
(2) Been convicted in a criminal proceeding or been subject to a pending criminal proceeding, excluding traffic violations and other minor offenses;
(3) Been subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities;
(4) Been found by a court of competent jurisdiction (in a civil action), the SEC, or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated; or
(5) Been the subject to, or a party to, any sanction or order, not subsequently reverse, suspended or vacated, of any self-regulatory organization, any registered entity, or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
On August 5, 2008, the United States Bankruptcy Court for the Central District of California entered an Order Confirming Second Amended Plan of Reorganization under Chapter 11 of the Bankruptcy Code of Valcom, Inc., of which Vince Vellardita, a former director and officer, is Chief Executive Officer.
Code of Ethics
Our board of directors has not adopted a code of ethics due to the fact that we presently have three directors, and we are in the development stage of our operations. We anticipate that we will adopt a code of ethics when we increase either the number of our directors and officers or the number of our employees.
Audit Committee
Our board of directors is comprised of three directors and has not established an audit committee. Accordingly, our Board of Directors presently performs the functions that would customarily be undertaken by an audit committee.
Compensation Committee
We do not presently have a compensation committee. Our Board of Directors currently acts as our compensation committee.
Nominating Committee
We do not presently have a nominating committee. Our Board of Directors currently acts as our nominating committee.
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ITEM 11. EXECUTIVE COMPENSATION
Executive Compensation
Executive Officers and Directors
The following tables set forth certain information about compensation paid, earned or accrued for services by (i) our Chief Executive Officer and (ii) all other executive officers who earned in excess of $100,000 in the fiscal years ended December 31, 2011 and 2010 (“Named Executive Officers”):
Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)* | Option Awards ($)* | Non-Equity Incentive Plan Compensation ($) | Nonqualified Deferred Compensation ($) | All Other Compensation ($) | Total ($) | |||||||||||||||||||||||||||
E. Lamar “Lou” Seals, III | 2011 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||
President, Chief Executive Officer, Chief Financial Officer and Chairman | 2010 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||
John W. Bonner, Jr. | 2011 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||
Executive Vice President, Treasurer and Director | 2010 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||
Edward A. Mearns III | 2011 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||
Secretary and Director | 2010 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||
Frank O’Donnell (1) | 2011 | 20,000 | 0 | 0 | 0 | 0 | 0 | 0 | 20,000 | |||||||||||||||||||||||||||
Former Chief Executive Officer and Director | 2010 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||
Lyle J Mortensen (1,3) | 2011 | 20,000 | 0 | 9,000 | 0 | 0 | 0 | 29,000 | ||||||||||||||||||||||||||||
Former Chief Executive Officer, and Director | 2010 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||
Gerry Shirren (1) | 2011 | 0 | 0 | 3,375 | 0 | 0 | 0 | 0 | 3,375 | |||||||||||||||||||||||||||
Chief Financial Officer, and Director | 2010 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||
Tiffany Kalahiki (2) | 2011 | 0 | 0 | 1,125 | 0 | 0 | 0 | 0 | 1,125 | |||||||||||||||||||||||||||
Secretary and Director | 2010 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
(1) resigned from all positions with the Company on October 21, 2011.
(2) resigned from all positions with the Company on January 13, 2011.
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(3) compensation received through Aritex Consultants, Inc. for his services.
Equity Compensation, Pension or Retirement Plans
No retirement, pension, profit sharing, stock option or insurance programs or other similar programs have been adopted by the Company for the benefit of its employees.
DIRECTOR COMPENSATION
The Company’s directors currently serve without compensation. However, on March 8, 2011 the Board of the Directors authorized the issue of its common shares to the officers and directors that had been serving without compensation in the following amounts:
Lyle J. Mortensen, Former CEO and director | 200,000 shares |
Gerry Shirren, Former CFO and director | 75,000 shares |
Tiffany Kalahiki, Former secretary and director | 25,000 shares |
COMPENSATION DISCUSSION AND ANALYSIS
Executive Compensation Guiding Principles
None of the officers have received compensation. Management is prepared to accept modest initial salaries to obtain financing for startup. Going forward, our general compensation philosophy is further guided by the following principles specific to our executives:
● A strong link between pay and Company performance.
● Executives aligned with stockholders and managing from the perspective of owners with a meaningful equity stake in TAN in the form of grants of stock options and restricted stock.
● A competitive compensation package that will enable the Company to attract and motivate high-performing talent and that is strongly competitive with other companies in our industry.
● A simple and cost-efficient program design.
The Compensation Committee of our Board of Directors determines the base salary (and any bonus and equity-based compensation) for each executive officer annually.
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
Security Ownership of Certain Beneficial Owners
The following table sets forth the beneficial ownership information of our common stock at December 31, 2011, for:
● each person known to us to be the beneficial owner of more than 5% of our common stock;
● each named executive officer;
● each of our directors; and
● all of our executive officers and directors as a group.
We have determined beneficial ownership in accordance with the rules of the SEC. Except as indicated by the footnotes below, we believe, based on the information furnished to us, that the persons and entities named in the table below have sole voting and investment power with respect to all shares of common stock reflected as beneficially owned. We have based our calculation of the percentage of beneficial ownership on 11,184,410 shares of common stock outstanding on December 31, 2011.
In computing the number of shares of common stock beneficially owned by a person and the percentage ownership of that person, we deemed outstanding shares of common stock subject to options or warrants held by that person that are currently exercisable or exercisable within 60 days of December 31, 2011. We did not deem these shares outstanding, however, for the purpose of computing the percentage ownership of any other person. It should be noted that no shareholder of the Company currently holds any options or warrants exercisable within 60 days of December 31, 2011. Beneficial ownership representing less than 1% is denoted with an asterisk (.*)
Name and Address of Beneficial Owner | Common Stock Beneficially Owned | Percentage Ownership(%) | ||||||
E. Lamar “Lou” Seals, III CEO, CFO and Director Address: 3340 Peachtree Road, N.E., Suite 1800, Atlanta, GA, 30326 | 6,000,000 | 53.6 | % | |||||
John W. Bonner, Jr. Director Address: 3340 Peachtree Road, N.E., Suite 1800, Atlanta, GA, 30326 | -0- | * | ||||||
Edward A. Mearns III Director Address: 3340 Peachtree Road, N.E., Suite 1800, Atlanta, GA, 30326 | -0- | * | ||||||
Lyle J. Mortensen Former CEO and Director 1701 W. Northwest Highway, Ste 100, Grapevine, TX 76051 Tiffany Kalahiki Address: 918 Noio St., Honolulu HI 96816 | 25,000 | * | ||||||
Gerry Shirren Former CFO and Director Address: Dublin, Ireland | 75,000 | * | ||||||
ICAG, Inc. Address:2222 Driftwood Tide Ave, Henderson, NV 89052 | 3,997,160 | 35.74 | % | |||||
Officers and Directors (3 persons) | 6,000,000 | 53.6 | % |
Changes in Control
On October 21, 2011 the Company entered into a private placement of a Convertible Promissory Note (the”Note”) in the amount of $30,000.00. The terms of the Note called for an election by the holder in due course to convert the promissory note into 6,000,000 shares of Common Stock of the Company. On December 15, 2011 the holder of the Note assigned all terms of the note to Seals Entertainment Company, LLC (“Seals”), which is owned by the current CEO and member of the Board of Directors, E. Lamar Seals, III. On December 23, 2011, Seals elected to convert the promissory note into 6,000,000 shares of the Company’s Common Stock. This transaction changed the control of the Company to E. Lamar Seals, III with 53.6% of the outstanding shares at the time of conversion of the Note in exchange for 6,000,000 shares of the Company’s common stock.
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ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE. |
As of December 31, 2011, the Company is indebted to Seals Entertainment Company, LLC, a shareholder of the Company holding greater than 10% of the issued and outstanding stock, in the amount of $11,855.
Other than listed above, none of the directors or executive officers of the Company, nor any person who owned of record or was known to own beneficially more than 5% of the Company’s outstanding shares of its Common Stock, nor any associate or affiliate of such persons or companies, has any material interest, direct or indirect, in any transaction that has occurred since inception, or in any proposed transaction, which has materially affected or will affect the Company.
ITEM 14. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. |
Audit Fees
During the fiscal year ended December 31, 2011, we incurred approximately $10,575 in fees to our principal independent accountants for professional services rendered in connection with the audit and reviews of our financial statements for fiscal year ended December 31, 2011.
During the fiscal year ended December 31, 2010, we incurred approximately $7,000 in fees to our principal independent accountants for professional services rendered in connection with the audit and reviews of our financial statements for fiscal year ended December 31, 2010.
Audit-Related Fees
The aggregate fees billed during the fiscal years ended December 31, 2011 and 2010 for assurance and related services by our principal independent accountants that are reasonably related to the performance of the audit or review of our financial statements (and are not reported under Item 9(e)(1) of Schedule 14A was $0 and $0, respectively.
Tax Fees
The aggregate fees billed during the fiscal years ended December 31, 2011 and 2010 for professional services rendered by our principal accountant tax compliance, tax advice and tax planning was $0 and $0, respectively.
All Other Fees
The aggregate fees billed during the fiscal years ended December 31, 2011 and 2010 for products and services provided by our principal independent accountants (other than the services reported in Items 9(e)(1) through 9(e)(3) of Schedule 14A) was $0 and $0, respectively.
Our Board of Directors pre-approves all audit and non-audit services performed by the Company’s auditor and the fees to be paid in connection with such service.
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
3.1 Articles of Incorporation (incorporated by reference to our Form S-1 as filed with the Securities and Exchange Commission on July 17, 2008).
3.2 Certificate of Amendment of Certificate of Incorporation.
3.3 Bylaws (incorporated by reference to our Form S-1 as filed with the Securities and Exchange Commission on July 17, 2008).
31 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32 Certification pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS XBRL Instance Document
101.SCH XBRL Taxonomy Extension Schema Document
101.CAL XBRL Taxonomy Extension Calculation Linkbase
101.LAB XBRL Taxonomy Extension Label Linkbase
101.PRE XBRL Taxonomy Extension Presentation Linkbase
101.DEF XBRL Taxonomy Extension Definition Linkbase
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
GLOBAL SMART ENERGY, INC. | ||
Date: April 3, 2012 | By: | /s/ Lamar “Lou” Seals |
President, Chief Executive Officer, Chief Financial Officer | ||
and Chairman | ||
(Principal Executive Officer and Principal Financial | ||
Officer) |
In accordance with the Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Name | Title | Date | ||
/s/ Lamar “Lou” Seals | President, Chief Executive Officer, Chief Financial Officer and Chairman | April 3, 2012 | ||
Lamar “Lou” Seals | ||||
/s/ John W. Bonner | Executive Vice President, Treasurer and Director | April 3, 2012 | ||
John W. Bonner | ||||
/s/ Edward A. Mearns | Secretary and Director | April 3, 2012 | ||
Edward A. Mearns |
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