UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-K

 

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended December 31, 2015

 

or

 

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______________ to ______________

 

Commission File Number: 333-182629

 

INTERNATIONAL METALS STREAMING CORP.

(Exact name of issuer as specified in its charter)

 

Nevada

45-5634033

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification Number)

12303 Airport Way, Suite 200

Broomfield, Colorado

80021

(Address of principal executive offices)

(Zip Code)

 

Registrant's telephone number, including area code (954) 868-7366

 

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

 

Title of each class

Name of each exchange on which registered

 

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

 

____________________________________________

(Title of class)

 

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

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every, Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ¨ No ¨

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes ¨ No x

 

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

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the 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: N/A.

 

As of March 15, 2016, the registrant had 12,093,754 shares of common stock outstanding.

 

 

 

 

TABLE OF CONTENTS

 

TO ANNUAL REPORT ON FORM 10-K

 

FOR YEAR ENDED DECEMBER 31, 2015

 

Page

PART I

Item 1.

Business

4

Item 1A.

Risk Factors

6

Item 1B.

Unresolved Staff Comments

6

Item 2.

Properties

6

Item 3.

Legal Proceedings

6

Item 4. 

Mine Safety Disclosures

6

PART II

Item 5.

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

7

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

10

Item 8.

Financial Statements and Supplementary Data

10

Item 9.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

10

Item 9A.

Controls and Procedures

10

Item 9B.

Other Information

11

PART III

Item 10.

Directors, Executive Officers and Corporate Governance

12

Item 11.

Executive Compensation

13

Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

14

Item 13.

Certain Relationships and Related Transactions, and Director Independence

15

Item 14.

Principal Accounting Fees and Services

15

PART IV

Item 15. 

Exhibits and Financial Statement Schedules 

16

Signatures

17

 

 
2
 

 

Forward Looking Statements

 

This report contains forward-looking statements. All forward-looking statements are inherently uncertain as they are based on current expectations and assumptions concerning future events or future performance of the registrant. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. Forward-looking statements usually contain the words "estimate," "anticipate," "believe," "expect," or similar expressions, and are subject to numerous known and unknown risks and uncertainties. In evaluating such statements, prospective investors should carefully review various risks and uncertainties identified in this report, including the matters set forth under the captions "Risk Factors" and in the registrant's other SEC filings. These risks and uncertainties could cause the registrant's actual results to differ materially from those indicated in the forward-looking statements. The registrant undertakes no obligation to update or publicly announce revisions to any forward-looking statements to reflect future events or developments.

 

Although forward-looking statements in this report reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by us. Consequently, forward-looking statements are inherently subject to risks and uncertainties, and actual results and outcomes may differ materially from the results and outcomes discussed in or anticipated by the forward-looking statements. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. We file reports with the Securities and Exchange Commission ("SEC"). You can read and copy any materials we file with the SEC at the SEC's Public Reference Room located at 100 F. Street, NE, Washington, D.C. 20549, on official business days during the hours of 10 a.m. to 3 p.m. You can obtain additional information about the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains an Internet site (www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, including the registrant.

 

We undertake no obligation to revise or update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this report. Readers are urged to carefully review and consider the various disclosures made throughout the entirety of this report, which attempt to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations and prospects.

 

 
3
 

 

PART I

 

ITEM 1. BUSINESS.

 

Our Corporate History and Structure

 

International Metals Streaming Corp (the "Company", "we, "us", or "our") was incorporated in Nevada on November 17, 2011, under the name "GS Valet, Inc." On December 1, 2011, the Company entered into an agreement with Garden State Valet, LLC, a New Jersey limited liability company ("Garden State Valet"), and the unit-holders of Garden State Valet (the "Unit-holders") to purchase all of the outstanding units of Garden State Valet. Garden State Valet was formed on June 15, 2011.

 

On August 9, 2013, six investors acquired 12,500,000 shares of our common stock then held by Neil Scheckter, who was our sole officer and director at the time. As a result, there was a change of control, as Mr. Scheckter relinquished his control of the Company and resigned from his positions. Immediately following their acquisition of the shares, one of the investors caused 4,093,746 shares that he acquired from Mr. Scheckter to be cancelled.

 

Also on August 9 and December 9, 2013, we sold a total of 1,875,161 shares of our common stock to four accredited investors (the "Investors") at $4.266 per share or gross proceeds of $8 million (the "Proceeds"), including $3 million in cash and $5 million in promissory notes issued by Preciosa Streaming Company Inc., a Barbados company ("Preciosa"). Preciosa issued the notes to two of the Investors, who in turn assigned them to us. Preciosa repaid the notes to us in full in September 2013.

 

On December 9, 2013, we further sold 1,533,166 shares of our common stock at $0.0001 per share for gross proceeds of $153.

 

We intended to use the Proceeds to pursue a metals streaming business by acquiring and managing precious metals streams, royalties and other similar interests. A stream is a non-operating interest in a mining project that provides the right to purchase metals produced from such project for a fixed price for a specified period of time in exchange for an upfront payment with such terms defined in the metals purchase agreement. Royalties are non-operating interests in mining projects that provide the right to revenue or metals produced from the project after deducting specified costs, if any.

 

In connection to our metals streaming plans:

 

 

·

we changed our name from "GS Valet, Inc." to "International Metals Streaming Corp." on September 26, 2013;

 

·

we changed our fiscal year end from September 30 to December 31, effective on September 26, 2013; and

 

·

the operations of Garden State Valet ceased on October 1, 2013.

 

On March 10, 2014, due to our determination that the metals streaming business was no longer desirable, we rescinded our transactions with the Investors whereby:

 

 

·

each Investor agreed to return the shares of our common stock issued to such Investor;

 

·

we remitted to each Investor a portion of the then remaining Proceeds pro rata to the shares of our common stock issued to such Investor; and

 

·

we and the Investors agreed to release all claims we may have against one another.

 

Accordingly, 1,875,161 shares in the aggregate were surrendered to us for cancellation. In addition, in November 2015, two additional shareholders surrendered an aggregate 1,533,166 shares of our common stock for cancellation and as thus as of December 31, 2015, there were 12,093,754 shares of our common stock outstanding.

 

Going Concern

 

Based on our financial history since inception, our independent registered public accounting firm has issued a going concern opinion in its audit report included in the financial statements that are a part of this annual report on Form 10-K (this "Report"). We are a shell company that has generated minimal revenues and, following the termination of our metals streaming business plan and the refund of the remaining Proceeds to the Investors in March 2014, currently has nominal assets. As a shell company, our new business plan is to seek, acquire or merge with a business or company. Our business operations are subject to all the risks and the uncertainties arising from the absence of a significant operating history and limited capital resources. No assurances can be given that we will ever be able to implement our business plan or, if implemented, will be successful. If our business plan is not successful, and we are not able to operate profitably, investors may lose their entire investment in our Company.

 

Through December 31, 2015, we have incurred $892,447 in losses since our inception. We have not achieved profitability and expect to continue to incur net losses throughout the fiscal year ending December 31, 2015 and, probably, into subsequent fiscal periods.

 

 
4
 

 

Shell Company Status

 

Following our decision to terminate the metals streaming business and to return the remaining Proceeds to the Investors in March 2014, we currently have nominal operations and minimal assets. As such, we are considered to be a shell company under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Accordingly, the securities sold in previous offerings can only be resold through (i) registration under the Securities Act of 1933, as amended (the "Securities Act"), (ii) Section 4(1) of the Securities Act, if available, for non-affiliates, or (iii) by meeting the conditions of Rule 144(i) of the Securities Act.

 

Current Business Plan

 

We are not currently engaged in any substantive business activity except the search for potential assets, property or businesses to acquire, and we have no current plans to engage in any other activity in the foreseeable future unless and until we complete any such acquisition. In our present form, we are deemed to be a shell company seeking to acquire or merge with a business or company. We do not intend to restrict our search for business opportunities to any particular business or industry, and the areas in which we will seek out business opportunities or acquisitions, reorganizations or mergers may include all lawful businesses. We recognize that the number of suitable potential business ventures that may be available to us may be extremely limited, and may be restricted as to acquisitions, reorganizations and mergers with businesses or entities that desire to avoid what such entities may deem to be the adverse factors related to an initial public offering as a method of "going public." The most prevalent of these factors include substantial time requirements, legal and accounting costs, the inability to obtain an underwriter who is willing to publicly offer and sell securities on behalf of the particular issuer, the lack of or the inability to obtain the required financial statements for such an undertaking, state limitations on the amount of dilution to public investors in comparison to the shareholders of any such entities, along with other conditions or requirements imposed by various federal and state securities laws, rules and regulations and federal and state agencies that implement them.

 

During the next 12 months, our only foreseeable cash requirements will relate to the payment of our SEC reporting filing expenses, including associated legal and accounting fees; costs incident to reviewing or investigating any potential business venture; and maintaining our good standing as a corporation in our state of organization. We anticipate that these funds will be provided to us in the form of loans from our present management. There are no written agreements requiring our management to provide these cash resources.

 

Competition

 

Management believes that there are literally thousands of shell companies engaged in endeavors similar to those engaged in by the Company; many of these companies have substantial current assets and cash reserves. Competitors also include thousands of other publicly-held companies whose business operations have proven unsuccessful, and whose only viable business opportunity is that of providing a publicly-held vehicle through which a private entity may have access to the public capital markets via a reverse reorganization or merger. There is no reasonable way to predict our competitive position or that of any other entity in these endeavors; however, we, having limited assets and no cash reserves, will no doubt be at a competitive disadvantage in competing with entities that have significant cash resources and have recent operating histories when compared with the lack of any substantive operations by the Company.

 

Government Regulations

 

Smaller Reporting Company

 

We are a "smaller reporting company," which designation relieves us of some of the informational requirements of Regulation S-K promulgated by the Securities Exchange Commission ("SEC").

 

Sarbanes/Oxley Act

 

We are also subject to the Sarbanes-Oxley Act of 2002, or "SOX Act." The SOX Act created a strong and independent accounting oversight board to oversee the conduct of auditors of public companies and strengthens auditor independence. It also requires steps to enhance the direct responsibility of senior members of management for financial reporting and for the quality of financial disclosures made by public companies; establishes clear statutory rules to limit, and to expose to public view, possible conflicts of interest affecting securities analysts; creates guidelines for audit committee members' appointment, compensation and oversight of the work of public companies' auditors; management assessment of our internal controls; auditor attestation to management's conclusions about internal controls; prohibits certain insider trading during pension fund blackout periods; requires companies and auditors to evaluate internal controls and procedures; and establishes a federal crime of securities fraud, among other provisions. Compliance with the requirements of the SOX Act will substantially increase our legal and accounting costs.

 

 
5
 

 

Emerging Growth Company

 

We are an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012, or "JOBS Act." As long as we remain an "emerging growth company," we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not an "emerging growth company," like those applicable to a "smaller reporting company," including, but not limited to, a scaled down description of our business in SEC filings; no requirements to include risk factors in Exchange Act filings; no requirement to include certain selected financial data and supplementary financial information in SEC filings; not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act; reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements that we file under the Exchange Act; no requirement for the SOX Act Section 404(b) auditor attestations of internal control over financial reporting; and exemptions from the requirements of holding an annual nonbinding advisory vote on executive compensation and seeking nonbinding stockholder approval of any golden parachute payments not previously approved. We are also only required to file audited financial statements for the previous two fiscal years when filing registration statements, together with reviewed financial statements of any applicable subsequent quarter.

 

We may take advantage of these reporting exemptions until we are no longer an "emerging growth company." We can remain an "emerging growth company" for up to five years. We would cease to be an "emerging growth company" prior to such time if we have total annual gross revenues of $1 billion or more and when we become a "larger accelerated filer," have a public float of $700 million or more or we issue more than $1 billion of non-convertible debt over a three-year period.

 

Employees

 

At present, Michael Hlavsa is our sole officer and director. Mr. Hlavsa works on a part-time basis and devotes approximately 5% of his time to our operation. He does not have an employment agreement with us.

 

Principal Executive Office

 

Our principal executive office is located at 12303 Airport Way, Suite 200, Broomfield, Colorado 80021. Our main telephone number is (954) 868-7366.

 

ITEM 1A. RISK FACTORS

 

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

 

ITEM 1B. UNRESOLVED STAFF COMMENTS

 

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

 

ITEM 2. PROPERTIES

 

The Company neither rents nor owns any properties. The Company utilizes the office space and equipment of its sole officer at no charge.

  

ITEM 3. LEGAL PROCEEDINGS

 

We were not subject to any legal proceedings during the twelve months ended December 31, 2015 and 2014. We know of no material, existing or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial stockholder, is an adverse party or has a material interest adverse to our Company.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

 
6
 

 

PART II

 

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASE OF EQUITY SECURITIES

 

Market Information

 

Our common stock is currently listed on the OTC Markets (the "OTC Pink") under the symbol "IMSTE." Previously, our common stock was listed on the OTC Bulletin Board under the symbols "INST" and "GSVA".

 

OTC Pink securities are not listed or traded on the floor of an organized national or regional stock exchange. Instead, OTC Pink securities transactions are conducted through a telephone and computer network connecting dealers in stocks. OTC Pink issuers are traditionally smaller companies that do not meet the financial and other listing requirements of a regional or national stock exchange.

 

As of March 15, 2016, no shares of our common stock have traded, and we cannot assure you that a market for our common stock will develop, if at all.

 

Holders

 

There were 37 holders of record of our common stock as of March 15, 2016.

 

Transfer Agent

 

Our transfer agent is West Coast Stock Transfer, Inc., whose address is 721 North Vulcan Avenue, Suite 205, Encinitas, California 92024, and whose telephone number is (619) 664-4780.

 

Dividends

 

While there are no restrictions that limit our ability to pay dividends, we have not paid, and do not currently intend to pay cash dividends on our common stock in the foreseeable future. Our policy is to retain all earnings, if any, to provide funds for operation and expansion of our business. The declaration of dividends, if any, will be subject to the discretion of our board of directors, which may consider such factors as our results of operations, financial condition, capital needs and acquisition strategy, among others.

 

Securities Authorized for Issuance under Equity Compensation Plans

 

None.

 

Recent Sales of Unregistered Securities

 

None.

 

ITEM 6. SELECTED FINANCIAL DATA

 

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

 

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS

 

The following discussion and analysis of our results of operations and financial condition for year ended December 31, 2015 and 2014 should be read in conjunction with our financial statements and the notes to those financial statements that are included elsewhere in this report. Our discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including those set forth under the "Risk Factors," "Cautionary Notice Regarding Forward-Looking Statements" and "Description of Business" sections and elsewhere in this report. We use words such as "anticipate," "estimate," "plan," "project," "continuing," "ongoing," "expect," "believe," "intend," "may," "will," "should," "could," "predict" and similar expressions to identify forward-looking statements. Although we believe the expectations expressed in these forward-looking statements are based on reasonable assumptions within the bound of our knowledge of our business, our actual results could differ materially from those discussed in these statements. Factors that could contribute to such differences include, but are not limited to, those discussed in the "Risk Factors" section of this report. We undertake no obligation to update publicly any forward-looking statements for any reason even if new information becomes available or other events occur in the future.

 

 
7
 

 

Overview

 

In 2011, we acquired Garden State Valet with the intent of going into the valet parking business. In August and December 2013, we raised $8 million in gross proceeds from sales of our common stock to four accredited investors, and intended to pursue a metals streaming business by acquiring and managing precious metals streams, royalties and other similar interests. In connection with such business, we changed our name and our fiscal year end, and the operations of Garden State Valet ceased in October 2013.

 

As of December 31, 2013, however, we had not entered into any definitive agreement in connection with such business. In March 2014, we determined that the metals streaming business was no longer desirable, and have ceased pursuing such business. As of December 31, 2015, the Company currently has nominal operations and minimal assets.

 

Results of Operations

 

 

 

For the year ended December 31,

2015

 

 

For the year ended December 31,

2014

 

Revenue

 

$ -

 

 

$ -

 

General and administrative expenses

 

 

(98,498 )

 

 

(204,047 )

Loss from operations

 

 

(98,498 )

 

 

(204,047 )
 

 

 

 

 

 

 

 

 

Other income (expense)

 

 

 

 

 

 

 

 

Forgiveness of debt

 

 

4,000

 

 

 

 -

 

Interest

 

 

(4,743 )

 

 

(3,388 )
 

 

 

 

 

 

 

 

 

Net loss

 

$ (99,241 )

 

$ (207,435 )

 

Revenue

 

For the years ended December 31, 2015 and 2014, we did not have any revenues from operations.

 

General and Administrative Expenses

 

For the years ended December 31, 2015 and 2014, our general and administrative expenses totaled $98,498 and $204,047, respectively. For the year ended December 31, 2015, the general and administrative expenses were primarily comprised of $85,407 in professional fees and $6,000 in consulting fees. For the year ended December 31, 2014, the general and administrative expenses were primarily comprised of $140,819 in professional fees and $52,000 in consulting fees. 

 

Net Loss

 

For the year ended December 31, 2015, our loss from continuing operations was $(98,498), gain on forgiveness of debt of $4,000 and  interest expense of $(4,744) for a total net loss of $(99,241) or $(0.01) per common share (basic and diluted) as compared to the year ended December 31, 2014, where our loss from continuing operations was $(204,047), interest expense of $(3,388) for a total net loss of $(207,435) or $(0.01) per common share (basic and diluted). Such decrease in losses was directly attributable to the decrease in professional expenses and consulting fees.

 

 
8
 

 

Liquidity and Capital Resources

 

In summary, our cash flows are as follows (amounts in $):

 

 

 

For the Year

 

 

For the

 

 

 

Ended

 

 

Year Ended

 

 

 

December 31,

 

 

December 31,

 

 

 

2015

 

 

2014

 

 

 

 

 

 

 

 

Net cash used in operating activities

 

$ (6,900 )

 

$ (169,736 )
 

 

 

 

 

 

 

 

 

Net cash provided by investing activities

 

$ -

 

 

$ 7,503,808

 

Net cash provided by (used in) financing activities

 

$ 5,448

 

 

$ (7,332,145 )

 

Net cash used in operating activities for the year ended December 31, 2015 was a result of costs attributable to professional expenses and consulting fees. Net cash used in operating activities for the year ended December 31, 2014 was attributable to increased costs for professional and consulting fees.

 

Net cash provided by investing activities for year ended December 31, 2014 was $7,503,808 consisting primarily of funds disbursed from the trust account maintained by the Company's counsel (the "Trust") related to operating expenses including funds being returned to investors from the previous sale of common stock.

 

Net cash provided by financing activities for the year ended December 31, 2015 was $5,448, related to notes payable. Net cash used in financing activities from continuing operations for the year ended December 31, 2014 was $7,332,145, related to funds being returned to investors from the Trust offset by $57,039 proceeds from notes payable.

 

As of December 31, 2015, we had cash of $475, total current assets of $475 and current liabilities of $230,741.

 

Off-balance Sheet Arrangements

 

We had no off-balance sheet arrangements at December 31, 2015.

 

Contractual Obligations

 

We had no contractual obligations at December 31, 2015.

 

Critical Accounting Policies

 

We prepare our audited financial statements in conformity with generally accepted accounting principles in the United States ("GAAP"), which requires management to make certain estimates and apply judgments. We base our estimates and judgments on historical experience, current trends and other factors that management believes to be important at the time the financial statements are prepared. Due to the need to make estimates about the effect of matters that are inherently uncertain, materially different amounts could be reported under different conditions or using different assumptions. On a regular basis, we review our critical accounting policies and how they are applied in the preparation of our financial statements.

 

While we believe that the historical experience, current trends and other factors considered support the preparation of our financial statements in conformity with GAAP, actual results could differ from our estimates and such differences could be material.

 

 
9
 

 

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 and disclosure of contingent assets and liabilities at the date of the financial statements. These estimates and assumptions also affect the reported amounts of revenues, costs and expenses during the reporting period. Management evaluates these estimates and assumptions on a regular basis. Actual results could differ from those estimates.

 

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

 

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 

Our audited financial statements for years ended December 31, 2015 and 2014, together with the report of the independent registered public accounting firms thereon and the notes thereto, are presented beginning at page F-1.

 

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 

On November 1, 2013, we engaged Gumbiner Savett Inc. ("Gumbiner"), as our registered independent public accountant. 

 

Effective June 6, 2014, we dismissed Gumbiner as our registered independent public accountant.

 

On June 6, 2014, we engaged Cutler & Co., LLC ("Cutler") as our independent registered public accountant.

 

Effective October 7, 2014, we dismissed Cutler as our registered independent public accountant.

 

On October 7, 2014, we engaged RBSM LLP as our independent registered public accountant.

 

We had no disagreements with Gumbiner in respect of accounting and financial disclosure.

 

As disclosed in our Current Report on Form 8-K filed on October 14, 2014, subsequent to the audit of our consolidated financial statements for the year ended December 31, 2013, a disagreement arose between Cutler and us with respect to the accounting treatment of certain financing transactions.

 

ITEM 9A. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures that are designed to ensure that information we are required to disclose in the reports that we file or submit under the Exchange Act, such as this annual report on Form 10-K, is recorded, processed, summarized and reported within the time periods specified by SEC rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information we are required to disclose in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management to allow timely decisions regarding required disclosure.

 

 
10
 

 

Our management evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2015, pursuant to paragraph (b) of Rules 13a-15 and 15d-15 under the Exchange Act. Such evaluation included a review of the controls' objectives and design, the operation of the controls, and the effect of the controls on the information presented in this annual report. Our management has concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were not effective as of December 31, 2015.

 

Internal Control Over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is a process designed 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.

 

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.

 

Our sole officer conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2015. Such evaluation was performed based on the framework in "Internal Control — Integrated Framework" issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based upon such evaluation, our sole officer concluded our internal controls over financial reporting were not effective. We lack resources to support full compliance.

 

This annual report does not include an attestation report of our registered public accounting firm regarding internal controls over financial reporting. Management's report was not subject to attestation by our registered public accounting firm pursuant to the rules of the SEC that permit us to provide only management's report in this annual report.

 

Changes in Internal Control over Financial Reporting

 

There was no change in our internal control over financial reporting during our most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

ITEM 9B. OTHER INFORMATION

 

None.

 

 
11
 

 

PART III

 

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 

On August 9, 2013, Neil Scheckter resigned as our sole officer and director at that time. His resignation was not due to any disagreement with us on any matter relating to our operations, policies or practices. Mr. Scheckter was replaced by Kyle Floyd effective August 9, 2013.

 

On September 15, 2014, Mr. Floyd resigned as our sole officer and director at that time. His resignation was not due to any disagreement with us on any matter relating to our operations, policies or practices.

 

The following table identifies our current executive officers and directors as of the date of this report, their respective offices and positions, and their respective dates of election or appointment:

 

Name

Age

Position

Date of Appointment

Michael Hlavsa

62

Chief Executive Officer, President, Chief Financial Officer,

Secretary and Director

September 15, 2014

 

Biographical Information

 

Mr. Hlavsa has served as the Chief Financial Officer and Director for Cognitiv, Inc. (COGV:PINK) since September 2013. From March 2007 to April 2011, Mr. Hlavsa served as Chief Financial Officer and a director of Gerova Financial Group, Ltd. (GFC:NYSE). From November 2007 to December 2011, he served as the Chief Financial Officer and Director for Fund.com Inc. (FNDM:PINK). Mr. Hlavsa received a Bachelor of Science degree from Canisius College in Buffalo, New York. He has received the designations of a Certified Public Accountant and a Certified Internal Auditor, and is currently a Chartered Global Management Accountant.

 

Involvement in Certain Legal Proceedings

 

There are no orders, judgments, or decrees of any governmental agency or administrator, or of any court of competent jurisdiction, revoking or suspending for cause any license, permit or other authority to engage in the securities business or in the sale of a particular security or temporarily or permanently restraining any of our officers or directors from engaging in or continuing any conduct, practice or employment in connection with the purchase or sale of securities, or convicting such person of any felony or misdemeanor involving a security, or any aspect of the securities business or of theft or of any felony. Nor are any of the officers or directors of any corporation or entity affiliated with us so enjoined.

 

The Board of Directors and Committees

 

We do not have any independent directors on our board of directors. Our board of directors currently has one director, Michael Hlavsa, who is also our sole officer and is therefore not independent. Our board of directors does not have any committees, as companies whose securities are quoted on the OTC Pink are not required to have board committees. However, if, at such time in the future, we appoint independent directors to our board, we expect to form the appropriate board committees.

 

We currently do not have a standing audit, nominating or compensation committee. Our board of directors handles functions that would otherwise be handled by each such committee. We believe that there is not a need for a nominating committee at this time because our board of directors consists of solely one director who is not independent and who is the only decision maker. At such point when we have independent board of directors we will need to establish a nomination committee.

 

 
12
 

 

ITEM 11. EXECUTIVE COMPENSATION

 

Summary of Compensation

 

The following summary compensation table indicates the cash and non-cash compensation earned during our fiscal years ended December 31, 2015 and 2014 by our principal executive officer and each of our other two highest paid executives.

 

Summary Compensation Table

 

Name and Principal Position

 

Year

 

Salary

($)

 

 

Bonus

($)

 

 

Stock

Awards

($)

 

 

Option

Awards

($)

 

 

Non-Equity

Incentive Plan

Compensation

($)

 

 

Nonqualified

Deferred

Compensation Earnings

($)

 

 

All Other

Compensation

($)(1)

 

 

Total

($)

 

Kyle Floyd,

 

2014

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

20,000

 

 

 

20,000

 

former sole officer (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Michael Hlavsa, sole officer

 

2014

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

13,000

 

 

 

13,000

 

 

 

2015

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

-0-

 

 

 

6,000

 

 

 

6,000

 

______________

(1)

Consulting fees paid to Mr. Floyd and accrued and partially paid to Mr. Hlavsa.

(2)

Mr. Floyd resigned on September 15, 2014.

 

Outstanding Equity Awards at December 31, 2015 and 2014

 

None.

 

Employment Agreements, Termination of Employment and Change-in-Control Arrangements

 

We currently have no employment agreement with our sole officer, nor any compensatory plans or arrangements resulting from his resignation, retirement or any other termination, from a change-in-control, or from a change in his responsibilities following a change-in-control.

 

Director Compensation

 

Kyle Floyd was our sole officer and director until his resignation on September 15, 2014. His compensation during such period is reflected in the Summary Compensation Table above. Michael Hlavsa was appointed as Director on September 15, 2014, his compensation during the fiscal years ended December 31, 2014 and2015 are also reflected in the Summary Compensation Table above.

 

We do not currently have an established policy to provide compensation to members of our board of directors for their services in that capacity. We intend to develop such a policy in the near future.

 

 
13
 

 

ITEM 12 . SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 

The following table sets forth certain information regarding our common stock beneficially owned on December 31, 2015, for (i) each stockholder known to be the beneficial owner of 5% or more of our outstanding common stock, (ii) each executive officer and director, and (iii) all executive officers and directors as a group. To the best of our knowledge, subject to community and marital property laws, all persons named have sole voting and investment power with respect to such shares, except as otherwise noted.

 

Common Stock Beneficially Owned

 

 

 

Number of

 

 

Percentage

 

 

 

Shares

 

 

of class

 

 

 

beneficially

 

 

beneficially

 

 

 

owned (2)

 

 

owned (3)

 

Executive officers and directors: (1)

 

 

 

 

 

 

 

 

Michael Hlavsa, sole officer and director

 

 

0

 

 

 

0.00 %

All directors and executive officers as a group (1 person)

 

 

0

 

 

 

0.00 %
 

 

 

 

 

 

 

 

 

5% Shareholders: (1)

 

 

 

 

 

 

 

 

MT Global Holdings LLC (4)

 

 

5,440,798

 

 

 

45.0 %

Mithical Holdings Limited (5)

 

 

766,583

 

 

 

6.4 %

Widder Investments Inc. (6)

 

 

766,583

 

 

 

6.3 %

Kyle Floyd

 

 

1,125,000

 

 

 

9.3 %

David Frey

 

 

766,583

 

 

 

6.3 %

Gary May

 

 

766,583

 

 

 

6.3 %

Geoffrey Mullen

 

 

766,583

 

 

 

6.3 %

Mark Suponitsky

 

 

766,583

 

 

 

6.3 %

Peter Turk

 

 

766,583

 

 

 

6.3 %
_______________

*

Less than 1%.

(1)

Unless otherwise noted, the address for each of the named beneficial owners is: 12303 Airport Way, Suite 200, Broomfield, Colorado 80021.

(2)

Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person's actual ownership or voting power with respect to the number of shares of common stock actually outstanding.

(3)

Unless otherwise noted, the number and percentage of outstanding shares of common stock is based upon 12,093,754 shares outstanding as of December 31, 2015.

(4)

The address of this stockholder is Zimikerweg 14, Volketswil CH-8604, Switzerland. Daniel Lacher.

(5)

The address of this stockholder is c/o Sona Company Services, Toedistrasse 53, Zurich CH-8002, Switzerland.

(6)

The address of this stockholder is c/o Sona Company Services, Toedistrasse 53, Zurich CH-8002, Switzerland.

 

 
14
 

 

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

 

From time to time, we enter into transactions in the normal course of business with related parties. We believe that such transactions are at arm's-length and have terms that would have been obtained from unaffiliated third parties. See Note 6, "Related Party Transactions" to the financial statements for a discussion of related party transactions.

 

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

 

Our current principal independent accountants are RBSM LLP ("RBSM "), whom we engaged on October 7, 2014. The following table shows the fees for audit and other services provided by RBSM in relation to our fiscal year ended December 31, 2015 and 2014:

 

 

 

Year ended December 31,
2015

 

 

Year ended December 31,
2014

 

Audit Fees (1)

 

$ 13,000

 

 

$ 12,000

 

Audit-related Fees (2)

 

 

-

 

 

 

-

 

Tax Fees (3)

 

 

-

 

 

 

-

 

All Other Fees (4)

 

 

-

 

 

 

-

 

Total

 

$ 13,000

 

 

$ 12,000

 

_______________

(1)

Audit Fees – This category includes the audit of our annual financial statements, review of financial statements included in our Quarterly Reports on Form 10-Q, and services that are normally provided by independent auditors in connection with statutory and regulatory filings or the engagement for fiscal years. This category also includes advice on audit and accounting matters that arose during, or as a result of, the audit or the review of interim financial statements.

(2)

Audit-Related Fees – This category consists of assurance and related services by our independent auditors that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under "Audit Fees." The services for the fees disclosed under this category include consultation regarding our correspondence with the SEC.

(3)

Tax Fees – This category consists of professional services rendered by our independent auditors for tax compliance and tax advice. The services for the fees disclosed under this category include tax return preparation and technical tax advice.

(4)

All Other Fees – This category consists of fees for other miscellaneous items.

 

Pre-Approval Policies and Procedures of the Board of Directors

 

Our board of directors approved the engagement of our independent registered public accounting firms.

 

 
15
 

 

PART IV

 

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

 

(1) Financial Statements

 

Our audited financial statements for the years ended December 31, 2015 and 2014 are included in Part II, Item 8 of this Report.

 

(2) Financial Statement Schedules

 

Schedules are omitted because the required information is not present or is not present in amounts sufficient to require submission of the schedule or because the information required is given in the financial statements or the notes thereto.

 

(3) Exhibits

 

EXHIBIT INDEX

 

Exhibit Number

Description

3.1

Articles of Incorporation (1)

3.2

Certificate of Amendment to Articles of Incorporation (2)

3.3

Bylaws (1)

10.1

Rescission and Release Agreement dated as of March 11, 2014 (3)

16.1

Letter from Gumbiner Savett Inc. dated June 13, 2014 (4)

16.2

Letter from Cutler & Co., LLC dated December 3, 2014 (5)

31.1

Section 302 Certification by the Corporation's Chief Executive Officer and Chief Financial Officer*

32.1

Section 906 Certification by the Corporation's Chief Executive Officer and Chief Financial Officer *

101.INST

XBRL Instance Document * †

101.SCH

XBRL Taxonomy Extension Schema Document

101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

XBRL Taxonomy Extension Label Linkbase Document

101.PRE

XBRL Taxonomy Extension Presentation Linkbase Document

_____________

*

Filed herewith

†

Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

(1)

Incorporated by reference from the registrant's Registration Statement on Form S-1 filed on July 11, 2012

(2)

Incorporated by reference from the registrant's Current Report on Form 8-K filed on September 26, 2013

(3)

Incorporated by reference from the registrant's Current Report on Form 8-K filed on March 14, 2014

(4)

Incorporated by reference from the registrant's Current Report on Form 8-K filed on June 06, 2014

(5)

Incorporated by reference from the registrant's Current Report on Form 8-K filed on December 8, 2014

 

 
16
 

 

SIGNATURES

 

Pursuant to the requirements of section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

 

INTERNATIONAL METALS STREAMING CORP.
(Registrant)

 

       
Date: March 30, 2016 By: /s/ Michael Hlavsa

 

 

 

Michael Hlavsa

 

 

 

Chief Executive Officer and Chief Financial Officer

 

 

 

(Principal Executive Officer and Principal Financial and Accounting Officer)

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

Signatures

Title(s)

Date

/s/ Michael Hlavsa

 

Director (Principal Executive Officer, Principal Financial Officer

 

March 30, 2016

Michael Hlavsa

and Principal Accounting Officer)

 

 

 
17
 

 

FINANCIAL STATEMENTS

 

Index to the Financial Statements

 

 

 

Page

 

Report of Independent Registered Public Accounting Firm

 

F-2

 

 

 

 

 

Balance Sheets as of December 31, 2015 and 2014

 

 

F-3

 

 

 

 

 

 

Statements of Operations for the Years Ended December 31, 2015 and 2014

 

 

F-4

 

 

 

 

 

 

Statements of Stockholders' Deficit for the Years Ended December 31, 2015 and 2014

 

 

F-5

 

 

 

 

 

 

Statements of Cash Flows for the Years Ended December 31, 2015 and 2014

 

 

F-6

 

 

 

 

 

 

Notes to Financial Statements

 

 

F-7

 

 

 
F-1
 

 
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To the Board of Directors and Shareholders of

International Metals Streaming Corp.

 

We have audited the accompanying balance sheets of International Metals Streaming Corp. (the "Company") as of December 31, 2015 and 2014 and the related statements of operations, changes in shareholders' deficit, and cash flows for each of the two years in the period ended December 31, 2015. 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 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 the Company as of December 31, 2015 and 2014 and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2015 in conformity with accounting principles generally accepted in the United States of America.

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the accompanying financial statements, the Company has sustained net losses from operations and used cash, rather than provided cash, from operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regards to these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty

 

/s/ RBSM LLP

 

 

New York, NY

 

March 30, 2016

  

 
F-2
 

 

INTERNATIONAL METALS STREAMING CORP.

BALANCE SHEETS

 

 

 

As of

 

 

 

December 31,
2015

 

 

December 31,
2014

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

Cash

 

$ 475

 

 

$ 1,927

 

Total Current Assets

 

 

475

 

 

 

1,927

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$ 475

 

 

$ 1,927

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' (DEFICIT)

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

 

Accrued expenses

 

$ 168,254

 

 

$ 75,913

 

Notes payable

 

 

62,487

 

 

 

57,039

 

Total current liabilities

 

 

230,741

 

 

 

132,952

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES

 

 

230,741

 

 

 

132,952

 

 

 

 

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS' DEFICIT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred stock, $0.0001 par value, 10,000,000 shares authorized, none issued and outstanding

 

 

-

 

 

 

-

 

Common stock, $0.0001 par value, 50,000,000 shares authorized; 12,093,754 and 13,626,920 shares issued and outstanding at December 31, 2015 and 2014, respectively

 

 

 1,209

 

 

 

 1,362

 

Additional paid-in-capital

 

 

660,972

 

 

 

660,819

 

Accumulated deficit

 

 

(892,447 )

 

 

(793,206 )

Total stockholders' deficit

 

 

(230,266 )

 

 

(131,025 )
 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT

 

$ 475

 

 

$ 1,927

 

 

The accompanying notes are an integral part of these audited financial statements

 

 
F-3
 

 

INTERNATIONAL METALS STREAMING CORP.

STATEMENTS OF OPERATIONS

 

 

 

For the Year

 

 

For the Year

 

 

 

Ended

 

 

Ended

 

 

 

December 31,

2015

 

 

December 31,

2014

 

 

 

 

 

 

 

 

Revenue

 

$ -

 

 

$ -

 

 

 

 

 

 

 

 

 

 

General and administrative expenses

 

 

(98,498 )

 

 

(204,047 )
 

 

 

 

 

 

 

 

 

Loss from operations

 

 

(98,498 )

 

 

(204,047 )
 

 

 

 

 

 

 

 

 

Other income (expense)

 

 

 

 

 

 

 

 

Forgiveness of debt

 

 

4,000

 

 

 

-

 

Interest

 

 

(4,744 )

 

 

(3,388 )
 

 

 

 

 

 

 

 

 

Loss from operations before income taxes

 

 

(99,241 )

 

 

(207,435 )
 

 

 

 

 

 

 

 

 

Income tax expense (benefit)

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Net loss

 

$ (99,241 )

 

$ (207,435 )
 

 

 

 

 

 

 

 

 

Weighted average loss per share - basic and dilutive

 

$ (0.01 )

 

$ (0.01 )
 

 

 

 

 

 

 

 

 

Weighted average shares outstanding - basic and dilutive

 

 

13,391,695

 

 

 

13,986,540

 

 

The accompanying notes are an integral part of these audited financial statements

 

 
F-4
 

 

INTERNATIONAL METALS STREAMING CORP.

STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT

FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014


 

 

 

 

Common Stock

 

 

 

 

 

 

 

 

 

 

 

 

$0.0001 par value

 

 

Additional

 

 

Accumulated

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Paid in Capital

 

 

(Deficit)

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2013 (Restated)

 

 

15,502,081

 

 

$ 1,550

 

 

$ 8,049,815

 

 

$ (585,771 )

 

$ 7,465,594

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 11, 2014 - Return of net proceeds from the sale of common stock

 

 

(1,875,161 )

 

 

(188 )

 

 

(7,388,996 )

 

 

-

 

 

 

(7,389,184 )
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss for the year ended December 31, 2014

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(207,435 )

 

 

(207,435 )
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2014

 

 

13,626,920

 

 

$ 1,362

 

 

$ 660,819

 

 

$ (793,206 )

 

$ (131,025 )
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

November 5, 2015 - Share cancellation

 

 

(1,533,166 )

 

 

(153 )

 

153

 

 

 

-

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss for the year ended December 31, 2015

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(99,241 )

 

 

(99,241 )
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2015

 

 

12,093,754

 

 

$ 1,209

 

 

$ 660,972

 

 

$ (892,447 )

 

$ (230,266 )

 

The accompanying notes are an integral part of these audited financial statements

 

 
F-5
 

 

INTERNATIONAL METALS STREAMING CORP.

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2015 AND 2014

 

 

 

For the Year

 

 

For the Year

 

 

 

Ended

 

 

Ended

 

 

 

December 31,

2015

 

 

December 31,

2014

 

 

 

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$ (99,241 )

 

$ (207,435 )

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Forgiveness of debt

 

 

 (4,000

) 

 

 

 -

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Increase in Accrued expenses

 

 

96,341

 

 

 

37,699

 

Net cash used in operating activities

 

 

(6,900 )

 

 

(169,736 )
 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in cash held in trust

 

 

-

 

 

 

7,503,808

 

Net cash provided by investing activities

 

 

-

 

 

 

7,503,808

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return of net proceeds from the sale of common stock

 

 

-

 

 

 

(7,389,184 )

Proceeds from notes payable

 

 

5,448

 

 

 

57,039

 

Net cash provided by (used in) financing activities

 

 

5,448

 

 

 

(7,332,145 )
 

 

 

 

 

 

 

 

 

(DECREASE) INCREASE IN CASH

 

 

(1,452 )

 

 

1,927

 

 

 

 

 

 

 

 

 

 

CASH, BEGINNING OF PERIOD

 

 

1,927

 

 

 

-

 

 

 

 

 

 

 

 

 

 

CASH, END OF PERIOD

 

$ 475

 

 

$ 1,927

 

 

 

 

 

 

 

 

 

 

Noncash financing activities:

 

 

 

 

 

 

 

 

Settlement of notes payable and accrued expenses

 

$ -

 

 

$ 49,537

 

 

 

 

 

 

 

 

 

 

Supplemental Information:

 

 

 

 

 

 

 

 

Cash paid for taxes

 

$ -

 

 

$ -

 

 

The accompanying notes are an integral part of these audited financial statements

 

 
F-6
 

 

INTERNATIONAL METALS STREAMING CORP.

Notes to Financial Statements

December 31, 2015

 

NOTE 1 – NATURE OF BUSINESS

 

Overview of Organization

 

International Metals Streaming Corp. (the "Company") was incorporated in the state of Nevada on November 17, 2011, under the name "GS Valet, Inc." On December 1, 2011, the Company entered into an agreement with Garden State Valet, LLC, a New Jersey limited liability company ("Garden State Valet"), and the unit-holders of Garden State Valet (the "Unit-holders") to purchase all of the outstanding units of Garden State Valet. Garden State Valet was formed on June 15, 2011.

 

Change in Control

 

On August 9, 2013, six accredited investors (the "Purchasers") acquired 12,500,000 shares of the Company's common stock in the aggregate then held by its former sole officer and director who, prior to such acquisition, held approximately 77.22% of the then issued and outstanding shares of common stock. Immediately thereafter, the Company caused 4,093,746 shares of its common stock that one of the Purchasers purchased to be cancelled pursuant to a Cancellation Agreement that the Company entered into with such Purchaser on August 9, 2013. As a result, the former sole officer and director relinquished his control of the Company and resigned, and a new sole officer and director was appointed in his place.

 

In connection with the change of control transaction, effective September 26, 2013, the Company changed its name from "GS Valet, Inc." to "International Metals Streaming Corp."

 

Effective September 26, 2013, the Company's board of directors approved a change in its fiscal year end from September 30 to December 31. The Company filed a Transition Report on Form 10-Q for the three months ended December 31, 2012 with the Securities and Exchange Commission (the "SEC") in connection therewith.

 

Until October 1, 2013, the Company, through Garden State Valet, provided valet parking management services for hotels, restaurants, country clubs, retail centers and private events in New Jersey. The operations of Garden State Valet ceased on October 1, 2013. The Company then planned to pursue a metals streaming business by acquiring and managing precious metals streams, royalties and other similar interests. As of December 31, 2013, however, the Company had not entered into any definitive agreement in connection with such business. In March 2014, the Company determined that the metals streaming business was no longer desirable, and have ceased pursuing such business. As of December 31, 2015, the Company currently has nominal operations and minimal assets. As such, the Company is considered to be a shell company under the Securities Exchange Act of 1934, as amended.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The financial statements include the accounts of the Company.

 

These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Significant accounting policies are as follows:

 

Use of Estimates

 

The preparation of financial statements in conformity with GAAP 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. These estimates and assumptions also affect the reported amounts of revenues, costs and expenses during the reporting period. Management evaluates these estimates and assumptions on a regular basis. Actual results could differ from those estimates.

 

Cash

 

The Company presently maintains any cash in an attorney trust account until such time that the Company establishes a bank account.

 

 
F-7
 

 

INTERNATIONAL METALS STREAMING CORP.

Notes to Financial Statements

December 31, 2015

 

Loss Per Share

 

The Company computes basic and diluted earnings per share amounts in accordance with ASC Topic 260,  Earnings per Share.  Basic earnings per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. During the years ended December 31, 2015 and 2014, there were no potentially dilutive debt or equity instruments outstanding.

 

Financial Instruments

 

ASC 820,  Fair Value Measurements  requires disclosure of the fair value of financial instruments.The Company's balance sheet includes certain financial instruments. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization.

 

Reclassification

 

Certain prior year amounts have been reclassified to conform to the current year presentation.

 

Recently Issued Standards

 

In January 2016, the FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities. The purpose is to enhance the reporting model for financial instruments to provide users of financial statements with more decision-useful information. This ASU is effective for the Company in the first quarter of 2018. Early adoption is not permitted except for limited provisions. The Company does not expect the adoption of this amendment to have a material effect on its financial condition and results of operations.

 

In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes. This is part of FASB's simplification initiative. The amendments in this ASU require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. This ASU is effective for the Company in the first quarter of 2017. Early adoption is permitted. The Company does not expect the adoption of this amendment to have a material effect on its financial condition and results of operations.

 

In September 2015, the FASB issued ASU 2015-16, Simplifying the Accounting for Measurement-Period Adjustments which allows entities to recognize adjustments to provisional amounts in the period adjustment is identified rather than retrospectively. In-period adjustments must be disclosed. This ASU is effective for the Company in the first quarter of 2016. The amendments should be applied prospectively to adjustments to provisional amounts that occur after the effective date of this ASU. Early adoption is permitted for financial statements that have not been issued. The Company does not expect the adoption of this amendment to have a material effect on its financial condition and results of operations.

 

In August 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-15, "Interest - Imputation of Interest (Subtopic 835-30)." ASU 2015-15 provides guidance as to the presentation and subsequent measurement of debt issuance costs associated with line of credit arrangements. We do not expect the adoption of ASU 2015-15 to have a material effect on our financial position, results of operations or cash flows. We do not expect the adoption of ASU 2015-15 to have a material effect on our financial position, results of operations or cash flows.

 

In August 2015, the FASB issued ASU No. 2015-14, Revenue From Contracts With Customers (Topic 606)." The amendments in this ASU defer the effective date of ASU 2014-09. Public business entities should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. We do not expect adoption of ASU 2015-14 to have a material effect on our financial position, results of operations or cash flows.

 

 
F-8
 

 

INTERNATIONAL METALS STREAMING CORP.

Notes to Financial Statements

December 31, 2015

 

In July 2015, the FASB issued ASU No. 2015-11, "Simplifying the Measurement of Inventory (Topic 330)." ASU 2015-11 simplifies the accounting for the valuation of all inventory not accounted for using the last-in, first-out ("LIFO") method by prescribing that inventory be valued at the lower of cost and net realizable value. ASU 2015-11 is effective for financial statements issued for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016 on a prospective basis. We do not expect the adoption of ASU 2015-11 to have a material effect on our financial position, results of operations or cash flows. We do not expect adoption of ASU 2015-14 to have a material effect on our financial position, results of operations or cash flows

 

In April 2015, the FASB issued ASU 2015-05, "Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40)." ASU 2015-05 provides guidance regarding the accounting for a customer's fees paid in a cloud computing arrangement; specifically about whether a cloud computing arrangement includes a software license, and if so, how to account for the software license. ASU 2015-05 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2015 on either a prospective or retrospective basis. Early adoption is permitted. We do not expect the adoption of ASU 2015-05 to have a material effect on our financial position, results of operations or cash flows.

 

In June 2014, the FASB issued ASU 2014-10, "Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation". The guidance eliminates the definition of a development stage entity thereby removing the incremental financial reporting requirements from U.S. GAAP for development or exploration stage entities, primarily presentation of inception to date financial information. The provisions of the amendments are effective for annual reporting periods beginning after December 15, 2014, and the interim periods therein. However, early adoption is permitted. Accordingly, the Company has adopted this standard as of December 31, 2014 and 2013.

 

In August 2014, the FASB issued ASU 2014-15, "Presentation of Financial Statements – Going Concern (Topic 205-40)", which requires management to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern for each annual and interim reporting period. If substantial doubt exists, additional disclosure is required. This new standard will be effective for the Company for annual and interim periods beginning after December 15, 2016. Early adoption is permitted. The Company has adopted this new standard for the fiscal year ended December 31, 2014 and the Company will continue to assess the impact on its financial statements.

 

There are various other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to a have a material impact on the Company's financial position, results of operations or cash flows.

 

NOTE 3 – GOING CONCERN

 

The Company's financial statements are prepared using US GAAP applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company had incurred net losses of $99,241 and $207,435 for the years ended December 31, 2015 and 2014, respectively. As of December 31, 2015 and 2014, our accumulated deficit was $892,447 and $793,206, respectively. The Company has not established an ongoing source of revenues sufficient to cover its operating costs, and requires additional capital to commence its operating plan. The ability of the Company to continue as a going concern is dependent on the sufficiency of its capital or obtaining additional capital to fund operating losses. If the Company requires or is unable to obtain additional capital, it could be forced to cease operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. The financial statements do not include any adjustment that might result from the outcome of this uncertainty.

 

NOTE 4 - NOTES PAYABLE, THIRD PARTY

 

On April 4, 2014, the Company issued a note payable to a third party in the amount of $57,039. The note was due and payable on April 4, 2015 and carries an interest rate of 8% per annum. This note is currently in default. However, a settlement agreement for the payment of this note payable at a significant discount is being negotiated but has not as yet been finalized. For the year ended December 2015 and 2014, there is $7,591 and $3,388, respectively in accrued interest related to the note payable included in accrued expenses.

 

On April 2, 2015, the Company issued a note payable to a third party in the amount of $2,500. The note is due and payable on April 2, 2016 and carries an interest rate of 8% per annum. For the year ended December 2015, there is $150 in accrued interest related to the note payable included in accrued expenses.

 

On November 12, 2015, the Company issued a note payable to a third party in the amount of $2,948. The note is due and payable on November 11, 2016 and carries an interest rate of 8% per annum. For the year ended December 2015, there is $32 in accrued interest related to the note payable included in accrued expenses.

 

 
F-9
 

 

INTERNATIONAL METALS STREAMING CORP.

Notes to Financial Statements

December 31, 2015

 

NOTE 5 – COMMITMENTS AND CONTINGENCIES

 

The Company has no commitments or contingencies as of December 31, 2015 and 2014.

 

From time to time, the Company may become a party to litigation matters involving claims against the Company. Management believes that it is adequately insured for its operations and there are no current matters that would have a material effect on the Company's financial position or results of operations.

 

NOTE 6 – RELATED PARTY TRANSACTIONS

 

During the year ended December 31, 2015, the Company incurred consulting fees of $6,000 provided by its current officer and director. During the year ended December 31, 2014, the Company incurred consulting fees of $13,000, provided by the current officer and director of the Company, of which $9,000 remains unpaid and included in accrued expenses.

 

During the year ended December 31, 2014, the Company paid its former officer and director $20,000 in consulting fees.

 

NOTE 7 – EQUITY

 

Preferred Stock

 

The Company is authorized to issue 10,000,000 shares of preferred stock with a par value of $0.0001 per share ("Preferred Stock"). No Preferred Stock has been issued to date.

 

Common Stock

 

The Company is authorized to issue 50,000,000 shares of common stock with a par value of $0.0001 per share ("Common Stock"). On October 7, 2013, the Company's board of directors approved a 2.5 for 1 forward stock-split of its issued and outstanding shares of Common Stock (the "Stock Split"). The Stock Split affected all shares of Common Stock outstanding immediately prior to the record date of October 3, 2013, and each stockholder of one share of Common Stock as of such record date received 2.5 shares of Common Stock. The Stock Split did not affect the par value of the Common Stock. No fractional shares were issued. The Stock Split increased the number of issued and outstanding shares of Common Stock from 5,400,035 to 13,500,092. These notes and the accompanying financial statements give retroactive effect to the Stock Split. The Company had 12,093,754 and 13,626,920 shares of Common Stock issued and outstanding at December 31, 2015 and 2014, respectively.

 

On August 9, 2013, the Company sold 1,406,338 shares of Common Stock (the "Initial Shares") at $4.266 per share to two accredited investors (the "Initial Investors"). The closing thereof occurred on August 9, 2013 with gross proceeds to the Company of $6 million in connection thereof, comprised of $1 million in cash and $5 million in promissory notes issued by Preciosa Streaming Company Inc., a Barbados company ("Preciosa"). Preciosa issued the promissory notes to the Initial Investors, who, in turn, assigned them to the Company at the Closing pursuant to a Note Assignment Agreement entered into by and between Company and each Initial Investor on August 9, 2013. Preciosa repaid these notes in full to the Company on September 20, 2013. Preciosa also reimbursed to the Company $28,263 in legal fees incurred by the Company. The cash proceeds from issuance of the Initial Shares were placed into a trust account maintained by the Company's counsel until such time that the Company could establish a bank account. However, on March 11, 2014, the proceeds, less the costs incurred in the pursuit of the metals streaming business, were returned to the investors.

 

 
F-10
 

 

INTERNATIONAL METALS STREAMING CORP.

Notes to Financial Statements

December 31, 2015

 

On August 9, 2013, the Company caused 4,093,746 shares of Common Stock held by a stockholder to be cancelled pursuant to a Cancellation Agreement entered into by and between the Company and such stockholder on August 9, 2013. The Company recognized a loss of $164 on the cancellation of this stock.

 
On December 9, 2013, the Company sold 468,823 shares of Common Stock (with the Initial Shares, collectively the "Shares") at $4.266 per share to two accredited investors (with the Initial Investors, collectively the "Investors"). The closing thereof occurred on December 9, 2013, with gross proceeds to the Company of $2 million. The cash proceeds from issuance of these shares were placed into a trust account maintained by the Company's counsel until such time that the Company could establish a bank account. However, on March 11, 2014, the proceeds, less the costs incurred in the pursuit of the metals streaming business, were returned to the investors.

 

On December 9, 2013, the Company sold 1,533,166 shares of Common Stock at $0.0001 per share for gross proceeds of $153.

 

On March 10, 2014, due to its determination that the metals streaming business was no longer desirable, the Company and the Investors rescinded their transactions pertaining to the Shares. In connection with such rescission: (a) each Investor agreed to return that portion of the Shares issued to such Investor, (b) the Company agreed to return the proceeds from the sale of the Shares to the Investors, net of all payments therefrom by the Company as of the date of the rescission, and (c) the Company and the Investors each agreed to release all claims that each of them may have against the other.

 

On March 11, 2014, $7,389,184 of the $8 million proceeds from the sale of 1,875,161 shares of Common Stock, less costs of $610,816, was returned to the Investors. In connection therewith, the certificates representing such shares have been surrendered to the Company for cancellation.

 

On November 5, 2015, two shareholders surrendered an aggregate of 1,533,166 shares of Common Stock to the Company and cancelled for no consideration. 

 

NOTE 8 – SUBSEQUENT EVENTS

 

The Company has evaluated subsequent events through the date these financial statements were available to be issued as of March 29, 2016 and determined that there are no reportable subsequent events.

  

 

F-11

 

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