Marvion Inc. 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Effectiveness of Disclosure Controls and Procedures We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules, regulations and related forms, and that such information is accumulated and communicated to our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. As of June 30, 2013, we carried out an evaluation, under the supervision and with the participation of our principal executive officer and our principal financial officer of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this report. We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Our disclosure controls and procedures were designed to provide reasonable assurance that the controls and procedures would meet their objectives. As required by SEC Rule 13a-15(b), our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective for fiscal year ending June 30, 2013. Management's Report on Internal Control Over Financial Reporting Our management is also responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act. The Company's internal control over financial reporting is 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. As of June 30, 2013, our management conducted an assessment of the effectiveness of the Company's internal control over financial reporting. In making this assessment, management followed an approach based on the framework in “Internal Control-Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based on this assessment, management has determined that the Company's internal control over financial reporting was not effective as of June 30, 2013. 36 Our Principal Executive Officer and Principal Financial Officer, currently the same person, conducted an evaluation of the effectiveness of our internal control over financial reporting as of June 30, 2013 based on the framework in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission, or COSO. Based on our evaluation and the material weaknesses described below, management concluded that the Company did not maintain effective internal control over financial reporting as of June 30, 2013, based on the COSO framework criteria. Management has identified control deficiencies regarding the lack of segregation of duties and the need for a stronger internal control environment. Our management believes that these material weaknesses are due to the small size of our accounting staff. The small size of our accounting staff may prevent adequate controls in the future, such as segregation of duties, due to the high cost of such remediation relative the benefit expected to be derived thereby. We anticipate that when we obtain sufficient funding and have substantial production, we will resolve the segregation of duties issue by naming a CFO or new company officer that will resolve any issues surrounding segregation of duties. In the interim period, to mitigate the current limited resources and limited employees, we rely heavily on direct management oversight of transactions, along with the use of external legal and accounting professionals. As we grow, we expect to create a new finance and accounting position that will allow for proper segregation of duties consistent with control objectives, and will increase our personnel resources and technical accounting expertise within the accounting function. As our financing staff grows we will prepare and implement appropriate written policies and checklists which set forth procedures for accounting and financial reporting with respect to the duties within the internal control framework. These current control deficiencies could result in a misstatement of account balances that would result in a reasonable possibility that a material misstatement to our consolidated financial statements may not be prevented or detected on a timely basis. Accordingly, we have determined that these control deficiencies as described above together constitute a material weakness. (b) Limitations on Effectiveness of Controls and Procedures Our management, including our chief executive officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected. These inherent limitations include, but are not limited to, the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, control may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Changes in Internal Control Over Financial Reporting During the fiscal year ended June 30, 2013, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Current management has hired independent counsel to investigate the control deficiencies, among many other things. The Company has removed Mr. David Janney, the prior CEO/CFO from all positions in the Company and he has no further affiliation with the company. The Company is still investigating whether the parties that participate in the forged debt conversions are victims or co-conspirators. 37 ITEM 9B. OTHER INFORMATION None. PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT. Director and Executive Officer Set forth below is information regarding the Company’s current and recent directors and executive officers. There are no family relationships between any of our directors or executive officers. The directors are elected annually by stockholders. The executive officers serve at the pleasure of the Board of Directors. Name Age Title Scott Geisler 50 Chief Executive Officer, Principle Accounting Officer, President Secretary, and Director (1) David Janney 49 Chief Executive Officer, Principle Accounting Officer, President Secretary, and Director(5) Pen Foo 51 Chief Financial Officer (2) William Berridge 59 Director(4) Peter Cao 50 Director (6) Michael Stojsavljevich 40 Chief Executive Officer, Principle Accounting Officer, President and Director(3) Peter Cao Baoky Vu 50 Secretary and DirectorDirector and Treasurer (4) 1. Effective June 1, 2012, Scott Geisler resigned as Chief Executive Office, Principal Financial Officer and as a member of the Board of Directors; 2. Effective May 11, 2012, Pen Foo resigned as Chief Financial Officer and Principle Accounting Officer; 3. Effective June 20, 2012, Michael Stojsavljevich was appointed Chief Executive Officer, Principle Accounting Officer, President, Secretary and Director; 4. Effective July 25, 2012, William Berridge resigned as Director and Baoky Vu was appointed new Director of the Company; 5. Effective October 24, 2011, David Janney resigned as Chief Executive Office, Principal Financial Officer and as a member of the Board of Directors; 6. Effective April 20, 2012, Peter Cao was appointed as Chief Executive Officer and Director and on June 26, 2012, Mr. Cao resigned as Chief Executive Officer and remained as a Director. The background and principal occupations of the current officers and directors of the Company is as follows: Officers and Directors: Peter Cao From 2009 to the present, Mr. Cao was an advisor to the Board of Directors of International Gold Mining Reserve Corporation. From 2007 through 2009, Mr. Cao was Vice President of Commercial Lending for United Americas Bank. From 1989 to 2007, Mr. Cao was President and CEO of General Contractors, Inc. Michael Stojsavljevich From April, 2011 to June 20, 2012, Michael Stojsavljevich was a Managing Partner with Episteme Advisory Group, a Boutique Corporate Strategy and Marketing Advisory Consultancy firm. From February 2007 through February 2011, Mr. Stojsavljevich was Chief Strategy Officer at the United States Mint, an agency of the United States Treasury Department. From 1999 through 2007, Mr. Stojsavljevich was in managing positions in Marketing, Finance and Corporate Affairs departments at Altria Corporate Services, Philip Morris USA, and Miller Brewing Company. Mr. Stojsavljevich earned a Master’s Degree in Business Economics from Western Michigan University and a Bachelor’s Degree in Economics from Indiana University. 38 Baoky Vu From 2009 to the present, Baoky Vu has been a principal of Silverberry Capital LLC, a strategic advisory firm based in Atlanta. From 1995 through 2009, Mr. Vu was director of equity research, portfolio manager and equity analyst with A. Montag & Associates. Mr. Vu earned a Masters of Business Administration from Georgetown University and a Bachelor of Science in Management from Georgia Institute of Technology. Audit Committee Financial Expert The Company does not have an audit committee or a compensation committee of its board of directors. In addition, the Company’s board of directors has determined that the Company does not have an audit committee financial expert serving on the board. When the Company develops its operations, it will create an audit and a compensation committee and will seek an audit committee financial expert for its board and audit committee. Conflicts of Interest Members of our management are associated with other firms involved in a range of business activities. Consequently, there are potential inherent conflicts of interest in their acting as officers and directors of our company. Although the officers and directors are engaged in other business activities, we anticipate they will devote an important amount of time to our affairs. Our officers and directors are now and may in the future become shareholders, officers or directors of other companies, which may be formed for the purpose of engaging in business activities similar to ours. Accordingly, additional direct conflicts of interest may arise in the future with respect to such individuals acting on behalf of us or other entities. Moreover, additional conflicts of interest may arise with respect to opportunities which come to the attention of such individuals in the performance of their duties or otherwise. Currently, we do not have a right of first refusal pertaining to opportunities that come to their attention and may relate to our business operations. Our officers and directors are, so long as they are our officers or directors, subject to the restriction that all opportunities contemplated by our plan of operation which come to their attention, either in the performance of their duties or in any other manner, will be considered opportunities of, and be made available to us and the companies that they are affiliated with on an equal basis. A breach of this requirement will be a breach of the fiduciary duties of the officer or director. If we or the companies with which the officers and directors are affiliated both desire to take advantage of an opportunity, then said officers and directors would abstain from negotiating and voting upon the opportunity. However, all directors may still individually take advantage of opportunities if we should decline to do so. Except as set forth above, we have not adopted any other conflict of interest policy with respect to such transactions. 39 Involvement in Certain Legal Proceedings None of the following events have occurred during the past ten years and are material to an evaluation of the ability or integrity of any current director or officer of the Company: 1. A petition under the Federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer at or within two years before the time of such filing; 2. Such person was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); 3. Such person was the subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from, or otherwise limiting, the following activities: a. Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity; b. Engaging in any type of business practice; or c. Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities laws or Federal commodities laws; 4. Such person was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in paragraph (f)(3)(i) of this section, or to be associated with persons engaged in any such activity; 5. Such person was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated; 6. Such person was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated; 7. Such person was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of: a. Any Federal or State securities or commodities law or regulation; or b. Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or c. Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or 8. Such person was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29)), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member. 40 Compliance with Section 16(A) Of The Exchange Act 9.A. Directors And Executive Officers, Promoters, And Control Persons: The Company is aware that all filings of Form 4 and 5 required of Section 16(a) of the Exchange Act of Directors, Officers or holders of 10% of the Company's shares have not been timely and the Company has instituted procedures to ensure compliance in the future. Current management and Directors have not filed their Forms 4 for 2011 but will file their forms 5 for the year ended June 30, 2013. Code of Ethics We have adopted a code of ethics that applies to all of our executive officers, directors and employees. Code of ethics codifies the business and ethical principles that govern all aspects of our business. Our Code of Ethics was published as Exhibit 14.1 in the Annual Report on Form 10-K for year ended June 18, 2009. This document will be made available in print, free of charge, to any shareholder requesting a copy in writing from the Company. ITEM 11. EXECUTIVE COMPENSATION General. From October 26, 2011 , Mr. Scott Geisler, until his resignation on June 1, 2012, served as the Company’s Chief Executive Officer and Principle Accounting Officer. From October 26, 2011until May 11, 2012, Mr. Pen-Mun Foo serviced as our Principal Accounting Officer. Until October 24, 2011, for the fiscal year of June 30, 2011, Mr. David Janney served as Chief Executive Officer and Principle Accounting Officer. Mr. Peter Cao served in that capacity between June 1, 2012 and June 20, 2012. On June 20, 2012, Mr. Michael Stojsavljevich was appointed President, Chief Executive Officer, and Principal Accounting Officer. 41 Summary Compensation Table The following table sets forth for the years ended June 30, 2013 and 2012 compensation awarded to, paid to, or earned by our (former) Director and Chief Executive Officer , and our other most highly compensated executive officers whose total compensation during the last fiscal year exceeded $100,000, if any. 2013 and 2012 SUMMARY COMPENSATION TABLE Name and Principal Position Year Salary ($) Bonus ($) Stock Awards ($) Option Awards ($) Non-Equity Incentive Plan Compensation ($) Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) All Other Compensation($) Total ($) Scott Geisler CEO 2013 - - - - - - - - & CFO, Director 2012 77,222 75,000 146,250 - - - - 298,472 David Janney CEO 2013 - - - - - - - - & CFO, Director 2012 - - 29,500 - - - - 29,500 Pen-Mun Foo, 2013 - - - - - - - - CFO, Director 2012 - - 10,300 - - - - 10,300 William Berridge, 2013 - - - - - - - - Director 2012 37,725 - 11,000 - - - - 48,725 Peter Cao, 2013 25,000 - - 132,348 - - - 157,348 Director and Treasurer 2012 2,500 - - 198,519 - - - 201,019 Michael Stojsavljevich 2013 49,500 - 200,000 - - - - 249,500 CEO & CFO, Director 2012 1,650 - - - - - - 1,650 42 2013 and 2012 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END TABLE Option Awards Stock Awards Number of Securities Underlying Unexercised Options (#) Number of Securities Underlying Unexercised Options (#) Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) Option Exercise Price ($) Option Expiration Date Number of Shares or Units of Stock That Have Not Vested (#) Market Value of Shares or Units of Stock That Have Not Vested ($) Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) Name Year Exercisable Unexercisable Scott Geisler 2013 - - - - - - - - - 2012 - - - - - - - - - David Janney 2013 - - - - - - - - - 2012 - - - - - - - - - Pen-Mun Foo 2013 - - - - - - - - - 2012 - - - - - - - - - William Berridge, 2013 - - - - - - - - - 2012 - - - - - - - - - Peter Cao 2013 - - - - - - - - - 2012 4,000,000 8,000,000 - 0.025 May 8, 2017 - - - - Michael Stojsavljevich 2013 - - - - - - - 2012 - - - - - - - - - Mr. Cao received options valued at $198,519 when joining the company in March of 2012. Mr. Cao's contract with the company was revised by the present Board of Directors in July 2013 replacing the options with a stock grant. The stocks for Mr. Cao, Mr. Stojsavljevich and Mr. Vu have not yet been issued. Mr. Cao has requested that the options remain in effect until the shares of stock are issued. 43 Compensation of Directors Our current compensation policy for directors is to compensate them through options to purchase common stock or through common stock as consideration for their joining our board and/or providing continued services as a director. We do not currently provide our directors with cash compensation, although we do reimburse their expenses, with exception for a chairman of the board. No additional amounts are payable to the Company’s directors for committee participation or special assignments. There are no other arrangements pursuant to which any directors was compensated during the Company’s last completed fiscal year for any service provided except as follows: On June 20, 2012 the Board of Directors appointed Michael Stojsavljevich as the new Chief Executive Officer, secretary and member of the Board of Directors. Mr. Stojsavljevich employment agreement will pay $5,500 for the first two months of his employment and $11,000 per month from the third month and allows for the Board of Directors to increase that monthly salary. The Company will pay for Mr. Stojsavljevich moving expenses of $5,000 also he will be entitled to 2,500,000 common shares of stock quarterly beginning July 1, 2012 and every quarter thereafter to a total of 10,000,000 shares. On August 1, 2012, Mr. Stojsavljevich entered into a new employment agreement with the Company to replace the agreement dated June 19, 2012 as follows: (1) Starting August 1, 2012, the Company will compensate Mr. Stojsavljevich at $5,500 monthly salary; (2) 10,000,000 shares of common stock were granted immediately and valued at $200,000 based on the market price at August 1, 2012. On October 30, 2012, Mr. Stojsavljevich entered into an amendment to the employment agreement to say that the term to issue 2,500,000 shares of common stock quarterly from July 1, 2012 and every quarter thereafter to a total of 10,000,000 shares stated in the June 19, 2012 agreement is replaced. (3) Salary will increase as the Company monthly production achieves operational milestones as described below: i. Production of 200 ounces: salary of $6,500 per month ii. Production of 400 ounces: salary of 7,500 per month iii. Production of 600 ounces: salary of $8,500 per month iv. Production of 800 ounces: salary of $9,500 per month v. Production of 1,000 ounces: salary of $10,500 per month vi. Production of 1,200 ounces: salary of 11,500 per month vii. At a monthly production of 1,200 ounces per month, another 4,000,000 shares will be granted. (4) Mr. Stojsavljevich will be eligible for bonuses based on a combination of individual performance and company performance which will be determined by the Board of Directors. On May 8, 2012, the Company entered into an employment contract with Mr. Cao. Pursuant to the agreement, the Company will pay monthly compensation of $1,000. Mr. Cao is also entitled to 2,000,000 common shares at $0.06 per share for the production or increase in the Company’s market value for every $15 million up to $100 million. Additionally, Mr. Cao is granted options to purchase a total of 8,000,000 common shares. Options for 4 million common shares exercisable at $0.025 per share vest immediately. After six months of Mr. Cao’s employment with the Company, additional options to purchase 4,000,000 shares at $0.025 per share will vest. On October 1, 2012, Mr. Cao entered into a new employment agreement with the Company to replace the agreement dated May 8, 2012. The October 1, 2012 agreement states the following: (1) Starting October 1, 2012, the Company will compensate Mr. Cao $4,000 monthly; (2) 8,000,000 shares of common stock were granted immediately and valued at $200,000 based on the market price at October 1, 2012. The stock has not been issued and was recorded as stock payable as of June 30, 2013. (3) Salary will increase as the Company’s monthly production hits the operational milestones as follows: i. Production of 200 ounces: salary of $5,000 per month ii. Production of 400 ounces: salary of $6,000 per month iii. Production of 600 ounces: salary of $7,000 per month iv. Production of 800 ounces: salary of $8,000 per month v. Production of 1,000 ounces: salary of $9,000 per month vi. Production of 1,200 ounces: salary of $10,000 per month vii. At production of 1,200 ounces per month, another 4,000,000 shares will be granted. (4) Mr. Cao will be eligible for bonuses based on a combination of individual performance and company performance which will be determined by the CEO and Board of Directors. 44 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table lists stock ownership of our Common Stock as of October 6, 2013, based on 411,982,943 shares of common stock issued and outstanding. The information includes beneficial ownership by (i) holders of more than 5% of our Common Stock, (ii) each of three directors and executive officers and (iii) all of our directors and executive officers as a group. Except as noted below, to our knowledge, each person named in the table has sole voting and investment power with respect to all shares of our Common Stock beneficially owned by them. Name and Address of Owner Title of Class Number of Shares Owned (1) Percentage of Class Michael Stojsavljevich 2415 East Camelback Road, Suite 700, Phoenix, AZ 85016 Common Stock - - Peter Cao 2415 East Camelback Road, Suite 700, Phoenix, AZ 85016 Common Stock - - Baoky Vu 2415 East Camelback Road, Suite 700, Phoenix, AZ 85016 Common Stock - - All Officers and Directors As a Group (3 persons) Scott Geisler 19803 Gulf Blvd, #501 Indian Shores, FL 33785 Common Stock 19,500,000 4.73 % Charles Chapman 206 South Grand Avenue Santa Ana, CA 92701 Common Stock 21,206,250 5.14 % Tonaquint, Inc. Attn: John M. Fife 303 East Wacker Drive, Suite 1200 Chicago, Illinois 60601 Common Stock 22,802,437 5.53 % (1) Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. 45 DESCRIPTION OF SECURITIES General Our authorized capital stock consists of 500,000,000 shares of common stock, par value $ 0.0001. Our authorized preferred stock consists of 20,000,000 shares of preferred stock, par value $0.0001. Common Stock The shares of our common stock presently outstanding, and any shares of our common stock issues upon exercise of stock options and/or warrants, will be fully paid and non-assessable. Each holder of common stock is entitled to one vote for each share owned on all matters voted upon by shareholders, and a majority vote is required for all actions to be taken by shareholders. In the event we liquidate, dissolve or wind-up our operations, the holders of the common stock are entitled to share equally and ratably in our assets, if any, remaining after the payment of all our debts and liabilities and the liquidation preference of any shares of preferred stock that may then be outstanding. The common stock has no preemptive rights, no cumulative voting rights, and no redemption, sinking fund, or conversion provisions. Holders of common stock are entitled to receive dividends, if and when declared by the Board of Directors, out of funds legally available for such purpose, subject to the dividend and liquidation rights of any preferred stock that may then be outstanding. Preferred Stock The company authorized 2 0 million shares of Series A Preferred Stock. The Preferred Stock contains certain rights, preferences, privileges, restrictions and other characteristics as further detailed in the Certificate of Designation to the Company’s Articles of Incorporation. Significantly, the Preferred Stock has 100 votes per share, whereas, each share of Common Stock has 1 vote. Preferred Stock holders may vote with holders of the Company’s Common Stock on all matters which common stockholders may vote. The Preferred shares do not have conversion rights to common shares. Voting Rights Each holder of Common Stock is entitled to one vote for each share of Common Stock held on all matters submitted to a vote of stockholders. T he Preferred Stock has 100 votes per share. Dividends Subject to preferences that may be applicable to any then-outstanding securities with greater rights, if any, and any other restrictions, holders of Common Stock are entitled to receive ratably those dividends, if any, as may be declared from time to time by the Company’s board of directors out of legally available funds. The Company and its predecessors have not declared any dividends in the past. Further, the Company does not presently contemplate that there will be any future payment of any dividends on Common Stock. Options and Warrants: As of June 30, 2013, there were 5,500,000 warrants and options outstanding, which does not include warrants to purchase 22,106,057 shares of the Company’s common shares issued to Tonaquint, Inc. Convertible Securities At June 30, 2013, the Company has one convertible security with Tonaquint, Inc. Transfer Agent On June 1, 2008, the Company engaged Transfer Online, Inc. to serve in the capacity of transfer agent. Their mailing address and telephone number Transfer Online, Inc., 317 SW Alder Street, 2 nd Floor, Portland, OR 97201 - Phone is (503) 227-2950. 46 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE. During the year ended June 30, 2012, the Company incurred fees totaling $37,725 to Auric Resources International, Inc., a company controlled by a former director. The director resigned on July 20, 2012. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES Audit Fees. The aggregate fees billed by GBH CPAs, PC for professional services rendered for the audit of the Company’s annual financial statements for fiscal year ended June 30, 2013 and 2012 approximated $16,000 and $27,000, respectively. The aggregate fees billed by GBH CPAs, PC for the review of the financial statements included in the Company’s Forms 10-Q for fiscal year 2013 and 2012 approximated $20,300 and $16,750, respectively. Audit-Related Fees. The aggregate fees billed by GBH CPAs, PC for assurance and related services that are reasonably related to the performance of the audit or review of the Company’s financial statements for the fiscal years ended June 30, 2013 and 2012, and that are not disclosed in the paragraph captioned “Audit Fees” above, were $3,000 and $0, respectively. Tax Fees. The aggregate fees billed by GBH CPAs, PC and for professional services rendered for tax compliance, tax advice and tax planning for the fiscal year ended June 30, 2013 and 2012 were $0. All Other Fees. The aggregate fees billed by GBH CPAs, PC for products and services, other than the services described in the paragraphs “Audit Fees,” “Audit-Related Fees,” and “Tax Fees” above for the fiscal years ended June 30, 2013 and 2012 were $0. The Board has received and reviewed the written disclosures and the letter from the independent registered public accounting firm required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees), and has discussed with its auditors its independence from the Company. The Board pre-approved all fees described above. 47 PART IV ITEM 15. EXHIBITS AND REPORTS. Exhibits 3.1 Articles of Incorporation (1) 3.2 Amendments to Articles of Incorporation (1) 3.1 Bylaws of the Corporation (1) 10.1 Agreement with Gold Exploration and Bonanza Goldfield, Dated July 1, 2009 (2) 10.2 Peter Cao Chief Operating Officer Employment agreement (3) 10.3 Scott Geisler Chief Executive Officer Employment Agreement (3) 10.4 Scott Geisler Waiver and Settlement Agreement (4) 10.5 10.17 10.18 Michael Stojsavljevich employment agreement () Amended and Restated Asset Purchase Agreement (5) Debt Settlement Agreement with Tonaquint (6) 10.19 Tonaquint, Inc Term Sheet (6) 14.1 31.1 Code of Ethics (2) Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act. (3) 31.2 Certification of Principal Financial and Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act. (3) 32.1 Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act. (3) 32.2 Certification of Chief Accounting Officer Pursuant to Section 906 of the Sarbanes-Oxley Act. (3) __________________________________________________ (1). Incorporated by reference to the same exhibit filed with Amendment No. 3 to the Company’s Registration Statement on Form SB2 (Commission File No. 333-137170). (2) Filed in the Form 10K for June 18, 2009 (3) Filed in the Form 10Q for March 31, 2012 (4) Filed in the Form 10-K for June, 2012 (5) Filed in the Form 8-K on September 26, 2013 and incorporated herein (6) Filed Herein 48 ITEM 15: SIGNATURES SIGNATURES In accordance with 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, there unto duly authorized. Bonanza Goldfields Corporation Registrant Date: October 15, 2013 By: /s/ Michael Stojsavljevich Michael Stojsavljevich Chief Executive Officer Date: October 15, 2013 By: /s/ Michael Stojsavljevich Michael Stojsavljevich Chief Financial Officer (Principal Accounting Officer) In accordance with the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Company and in the capacities and on the dates indicated. Date: October 15, 2013 By: /s/ Michael Stojsavljevich Michael Stojsavljevich Director Date: October 15, 2013 By: /s/ Peter Cao Peter Cao Director Date: October 15, 2013 By: /s/ Baoky Vu Baoky Vu Director 49