SECURITIES AND EXCHANGE COMMISSION




WASHINGTON, D.C. 20549




FORM 10-K




(Mark One)




[X] ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934




FOR THE FISCAL YEAR ENDED SEPTEMBER 30,
2010




Transition Report Pursuant to Section 13 or 15(d) of
the




SECURITIES EXCHANGE ACT OF 1934




VALCOM, INC.




(Name of small business issuer specified in its
charter)


|Delaware                                                       |  |  |  | 58-1700840                          
|-------------------------------------------------------------- |  |  |  | ------------------------------------
|(State or other
jurisdiction of incorporation or organization) |  |  |  | (IRS Employer Identification Number)



2113A Gulf Boulevard, Indian Rocks Beach, Florida 33785 (Address of Principal executive offices) (Zip code)




(727) 9539778 Issuers telephone number




Securities registered pursuant to 12(b) of the Act: None
Securities to be registered pursuant to Section 12(g) of the Act:




COMMON STOCK $0.001 PAR VALUE (Title of Class)




Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act.




Yes [ ] No [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 of1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90
days.




Yes [X] No [ ]




Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of
Regulation S-T({section}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 [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. Seethe definitions of large accelerated
filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.







|Large
accelerated filer   |  |  |  |  | [ ] | 
|------------------------- |  |  |  |  | --- | 
|Accelerated
filer         |  |  |  |  | [ ] | 
|Non-accelerated filer     |  |  |  |  | [ ] | 
|Smaller
reporting company |  |  |  |  | [X] | 



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




Yes [ ] No [X]




Revenues for year ended September 30, 2010:
$




Number of shares of the registrants common stock
outstanding as of , 2011 was .


---





TABLE OF CONTENTS


|           |  |  |    |                                                                                                              |  | Page
|---------- |  |  | -- | ------------------------------------------------------------------------------------------------------------ |  | ----
|PART
I     |  |  |    |                                                                                                              |  |     
|           |  |  |    |                                                                                                              |  |     
|ITEM
1.    |  |  |    | BUSINESS                                                                                                     |  |     
|ITEM
1A.   |  |  |    | RISK FACTORS                                                                                                 |  |     
|ITEM
2.    |  |  |    | PROPERTIES                                                                                                   |  |     
|ITEM
3.    |  |  |    | LEGAL PROCEEDINGS                                                                                            |  |     
|ITEM
4.    |  |  |    | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                                          |  |     
|           |  |  |    |                                                                                                              |  |     
|PART
II    |  |  |    |                                                                                                              |  |     
|           |  |  |    |                                                                                                              |  |     
|ITEM
5.    |  |  |    | MARKET FOR REGISTRANTS COMMON EQUITY; RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES |  |     
|ITEM
6.    |  |  |    | SELECTED FINANCIAL DATA                                                                                      |  |     
|ITEM
7.    |  |  |    | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS                        |  |     
|ITEM
7A.   |  |  |    | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                                   |  |     
|ITEM
8.    |  |  |    | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                                                  |  |     
|ITEM
9.    |  |  |    | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE                         |  |     
|ITEM
9A.   |  |  |    | CONTROLS AND PROCEDURES                                                                                      |  |     
|           |  |  |    |                                                                                                              |  |     
|PART
III   |  |  |    |                                                                                                              |  |     
|           |  |  |    |                                                                                                              |  |     
|ITEM
10.   |  |  |    | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE                                                       |  |     
|ITEM
11.   |  |  |    | EXECUTIVE COMPENSATION                                                                                       |  |     
|ITEM
12.   |  |  |    | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS               |  |     
|ITEM
13.   |  |  |    | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE                                    |  |     
|ITEM
14.   |  |  |    | PRINCIPAL ACCOUNTANT FEES AND SERVICES                                                                       |  |     
|           |  |  |    |                                                                                                              |  |     
|PART
IV    |  |  |    |                                                                                                              |  |     
|           |  |  |    |                                                                                                              |  |     
|ITEM
15.   |  |  |    | EXHIBITS, FINANCIAL STATEMENT SCHEDULES                                                                      |  |     
|SIGNATURES |  |  | 40

---





PART I




ITEM 1.  DESCRIPTION OF
BUSINESS




VALCOM, INC.S CORPORATE STRUCTURE




As of September 30, 2010, ValCom, Inc. had the following
operating subsidiaries:


|1. |  | My Family TV, LLC 100%
|-- |  | ----------------------

|2. |  | Valencia Entertainment International 100%
|-- |  | -----------------------------------------



Unless the context requires otherwise, the term
Company includes ValCom, Inc., a publicly held Delaware corporation and, its subsidiaries, predecessors and affiliates whose operations or
assets have been taken over by ValCom, Inc.




The Company also has a number of non-operating
subsidiaries.




The Company is a diversified entertainment company and
during 2009, reorganized its operations into the following five divisions:


|1. |  | BROADCASTING
|-- |  | ------------



On December 15, 2008, we acquired 100% of Faith TV LLC, a
Christian TV network operating through 65 television broadcast affiliates and through IPTV & LPTV networks. Upon closing, we re-branded the network
and launched it as My Family TV, a new family focused TV network with plans to add significantly more broadcast affiliates. My Family TV is
a strong family oriented network with a core established audience that broadcasts to almost 30m households on full-time and part-time basis through its
extensive affiliate network. My Family TV is a network created for American families, broadcasting in 80-90 markets throughout the United
States.




Since acquisition, the network has expanded by signing
affiliation agreements that place My Family TV into major markets including San Francisco, Houston, Miami, Dallas, Phoenix, Detroit, Tampa, and
Charlotte. My Family TV will continue this expansion in 2011 by implementing an aggressive sales and marketing plan to launch the network in additional
major markets across the country.




With the acquisition of My Family TV, we now have a library
of over 1,000 films, over 200 episodic TV series and more than 500 individual TV one-off specials and documentary programs.




The purchase price included 100,000 shares of convertible
preferred stock valued at $9,000 based on an as if converted basis; 1,500,000 shares of common stock valued at $59,400 based on the
Companys quoted stock price; cash payments totaling $661,092. The total adjusted purchase price was $729,492. In September of 2009, ValCom made
the final payment and now owns the television network 100% debt free.


|2. |  | FILM AND TV PROGRAM PRODUCTION DIVISION
|-- |  | ---------------------------------------



ValComs business includes television production for
network and syndication programming, motion pictures, and real estate holdings. ValComs past and present clients include Paramount Pictures, Don
Belisarious Productions, Warner Brothers, Universal Studios, MGM, HBO, NBC, 20th Century Fox, Disney, CBS, Sony, Showtime, the USA Network, the Game
Show Network, Endemol, BET Home Shopping Network and Sullivan Studios.




ValCom has a long history of TV and film production and
continuously develops projects for productions and considers proposals for co-production. ValCom has developed and produced a number of live action
series pilots and full length feature film projects such as PCH (Pacific Coast Highway), One Deadly Road and the 40 episode TV series AJs Time
Travelers. ValCom has been commissioned to produce pilots such as Truster for Fox. It also produces development pilots itself for pitching to networks
such as the New York based sitcom Fuhgedabowit and Lets Do It Again featuring Frankie Avalon and Ultimate Driver. With its integrated studio
operation, studio equipment and post production facility, ValCom has the opportunity to co-produce by way of the provision of services with the
opportunity to defer costs and also to provide executive producer services to assist with development, planning, financing and
distribution.




1


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Over the last 25 years the company has been producing and
acquiring movies, Television Shows and Music titles and to date, have comprised an impressive list of almost 5,000 titles and has now started to put
them in the market by leasing the titles to TV networks, iTunes, On Demand while continuing to seek new media options. There has already been a major
interest through some of the biggest names in the entertainment industry. ValCom also plans on remaking some of the older titles. The company is in the
process of having all of its content appraised.




In 2009, ValCom produced the documentary feature film
‘Michel LeGrand is Music. The documentary pays tribute to Michel LeGrands five-decade, multiple award-winning career composing many
of the most memorable film and television scores and songs of all time. ValCom Inc. will premiere the documentary in a limited week-long theatrical run
in New York City on September 18th at the Coliseum Theater. In addition, the documentary will premiere in Los Angeles on September 16th at the Laemmle
Grand Cineplex 4. Michel LeGrand Is Music honors the work of the three-time Academy Award-winning French music composer, arranger,
conductor and pianist Michel LeGrand. LeGrand composed more than 200 film and television scores and numerous jazz, popular and classical musical
albums. He won Academy Awards for Best Music, Original Song for The Windmills of Your Mind from The Thomas Crown Affair (1969),
Best Music, Original Dramatic Score for Summer of ‘42(1971) and Best Music, Original Song for Barbra Streisand Movie
Yentl (1983). Academy Award-winning actor Jon Voight narrates the documentary.


|3. |  | LIVE THEATRE AND EVENT DIVISION
|-- |  | -------------------------------



ValCom has a live theatre division responsible for bringing
live shows and events to fruition. In 2006 ValCom produced a theater production called ‘Headlights and Tailpipes which was unveiled at the
Las Vegas Stardust hotel and ran until July 2006. Other events produced included the 2006 Superbowl pre-game Wrap Bowl Event featuring Young Jeezy,
Academy Award winner Ludacris, Juvenile and Juelz Santana.




ValCom produced a live theatre event based on Michel
LeGrand and his music which debuted March 2010 at the MGM Grand, Las Vegas and featured a line-up of major international recording stars such as Sting,
George Benson, Melissa Manchester, Dion Warwick, Frank Sinatra Jr, Patti Page and Jerry Lewis. The show was also shot for Television and licensed to
PBS for two years for a $200,000 fee.


|4. |  | DISTRIBUTION
|-- |  | ------------



ValCom, through Valencia Entertainment International
operates a complete distribution and syndication service to producers and thus
acquires content for its networks at little or no cost with its ability to guarantee TV broadcast and provide a launch for further home entertainment
distribution on DVD and on-demand channels through it other relationships. ValCom also has the opportunity to co-produce film and TV programs by way of
the provision of services with the opportunity to defer costs and also to provide executive producer services to assist with development, planning,
financing and then be able to acquire distribution rights for these productions.




ValCom owns a substantial library of television content
with over 1000 films and it also acquires third party film and TV programming which it distributes through Valencia Entertainment International.
ValComs extensive library also contains 5000 music titles, with some of the original records of the Platters, Elvis and Ike and Tina
Turner.




Valencia Entertainment was once a very successful
distributor of ValComs content of Movies and Television shows. In its first years of selling the content, it sold millions of dollars in
licensing fees. ValCom has determined that the time is right to take the product out to the market this year and relive the success story of selling
its content that is now starting to be utilized on its TV Network, My Family TV. The Company just finished its first of many tradeshows and seems to
have had a great response at NATPE this year in Miami, FL and has already put out several proposals.




On November 6, 2007, Valencia Entertainment signed an
agreement with Porchlight Distribution Inc. from Santa Monica Blvd., Los Angeles, for the worldwide distribution of all 40 episodes of A.J.s Time
Travelers.




In December 2008, ValCom signed a production and
distribution agreement with XFC, the mixed martial arts promoter for the editing and world-wide distribution of 13 one hour shows featuring live events
promoted by XFC. XFC events are currently attracting the largest audiences of any mixed martial arts events promoted in the US.




2


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To coincide with the Michel LeGrand live events in Las
Vegas in 2010, ValCom is planning a number of distribution opportunities including the distribution and syndication of programming based on the live
event, music recordings, album and other related events.


|5. |  | REAL ESTATE AND OTHER BROADCAST EVENT
AUCTIONS
|-- |  | ----------------------------------------------



In 2009, ValCom pioneered the process of live event
auctions covering a wide range of events for TV broadcast and live webcast. Combining the expertise in TV production, live event promotion and now as
the owner of a broadcast TV network, the opportunity offers a synergistic approach to such events. In 2008 and 2009, ValCom produced a wide range live
TV and webcast events including:


|1. |  | The Hilton ‘Make a Wish Foundation broadcast live
from Barron Hiltons mansion in Beverly Hills in December 2008;
|-- |  | ------------------------------------------------------------------------------------------------------------------

|2. |  | The Universal Studios ‘Battlestar Galactica prop and
memorabilia auction by live web-cast in 2009 over a number of days from the Pasadena Convention Centre;
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. |  | The Grammy Awards ‘Music Cares auction as part of
the 2009 Grammy Awards.
|-- |  | --------------------------------------------------------------------------



EXPANSION PLANS




The Company continuously reviews industry developments and
regulations for potential expansion opportunities. As a public company, the Company benefits from operating in highly regulated markets, which levels
the competitive playing field.




On July 14, 2007, we voluntarily filed for protection under
Chapter 11 of the U.S. Bankruptcy Code and became a Debtor in Possession. During 2008, we completed a plan of reorganization and emerged from
bankruptcy.




The background to the bankruptcy was that ValCom had
initiated suit against Chicago Title and The Laurus Master Fund in October 2005 because it claimed that Laurus and Chicago Title had retained the
$500,000 overage arising out of the proceeding in 2003/4. Subsequently, the trial court entered summary judgment in favor of Chicago Title and Laurus.
ValCom appealed, contending that there were triable issues as to whether: (1) ValCom suffered damages; (2) Chicago Title and Laurus violated Civil Code
sections 2924K, 2924d, and 2924h; and (3)Chicago Title breached its duties as the foreclosure trustee.




Additionally, at the time that the trial court granted
Summary Judgment against ValCom, the trial court awarded costs and attorney fees of $562,127.30, and ValCom argued in its appeal that Chicago Title was
not entitled to attorney fees, and the attorney fees awarded to Laurus were excessive.




Prior to the filing of the Chapter 11 bankruptcy, ValCom
attempted to obtain a stay against enforcement of the attorney fees and costs judgment awarded to Chicago Title and Laurus pending appeal. ValCom was
unable to prove to the trial courts satisfaction that the value of ValComs assets was sufficient to protect Chicago Title and Laurus
judgment. The Court denied ValComs attempt to use its property in lieu of a cash bond, and threatened with enforcement of the judgment, ValCom
had no choice but to file for the protection of the bankruptcy court.




ValCom, through appeals counsel, filed an appeal, and oral
argument on the appeal occurred December 17, 2007. On February 13, 2008, subsequent to the Debtors status conference in bankruptcy court, the
Court of Appeals for the Second Appellate District, Division Two, case number B193714, ruled in favor of ValCom, Inc. ValCom has reasserted its claim
against Laurus and Chicago Title for money damages based upon a foreclosure conducted by them. The case is set for trial on April 6, 2009. No action or
claim has been asserted against ValCom by these defendants.




On March 24, 2009, ValCom and Laurus Master Fund, Ltd, and
Chicago Title Company entered into a Settlement Agreement whereby ValCom resolved its previously asserted claims against Laurus and Chicago
Title. Pursuant to the terms of the Agreement, Laurus agrees to pay the Company five hundred and fifty thousand dollars ($550,000) which was received
by the Company attorney on March 30, 2009. Within ten calendar days after the Company receives payment from Laurus, the Company filed a Request for
Dismissal of its claims, with prejudice, of its actions against Laurus and Chicago Title and Chicago Title. This settlement is reflected as
‘Other Income with full accrual made for legal costs relating to the settlement.




3


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During this time, ValCom completed a major re-organization
of its operations and prepared a new business plan that will allow the Company to grow through acquisitions and internal growth. It is imperative that
the Company continues to grow its operational revenues. The Company has invested in new corporate offices, new studio facilities and has assembled its
management team and operational infrastructure.




On August 1, 2008, ValCom signed a letter of intent to
acquire 100% of Faith TVLLC, a Christian TV network operating through 65 television broadcast affiliates and through IPTV & LPTV networks. On
December 15, 2008, ValCom closed the agreement for the 100% purchase of Faith TV and has rebranded the network and launched it as My Family
TV, a new family focused TV network with plans to add significantly more broadcast affiliates.




In December 2008, ValCom signed a production and
distribution agreement with XFC, the mixed martial arts promoter for the editing and world-wide distribution of 13 one hour shows featuring live events
promoted by XFC.




THE COMPANYS COMPETITIVE POSITION




The Companys operations are in competition with all
aspects of the entertainment industry, locally, nationally and worldwide.




ValCom experiences competition from four market
segments:


|1) |  | Traditional television broadcasting
|-- |  | -----------------------------------

|2) |  | Interactive television, game shows and reality television
drama
|-- |  | ---------------------------------------------------------------

|3) |  | Movies for television and theatrical releases
|-- |  | ---------------------------------------------

|4) |  | Studio facility services and other entertainment/media
companies
|-- |  | ----------------------------------------------------------------



TELEVISION BROADCASTING




While the company has significant experience in TV
broadcasting and is broadcasting a 24/7 network through an affiliate network, technology advancements in the television broadcast area with a move to
high definition broadcast and expansion through IPTV & LPTV networks will be a feature of virtually TV networks. The competitive environment for
advertising has been especially difficult over recent times but the management expects that consolidation in the industry, alignment with other
networks to increase carriage and household coverage and continued innovative programming, particularly where network broadcast is a key element to a
number of revenue streams will be the focus of the management for the continued growth of the network.




On December 15, 2008, we acquired 100% of Faith TV LLC, a
Christian TV network operating through 65 television broadcast affiliates and through IPTV & LPTV networks. Upon closing, we re-branded the network
and launched it as My Family TV, a new family focused TV network with plans to add significantly more broadcast affiliates. My Family TV is
a strong family oriented network with a core established audience that broadcasts to almost 30m households on full-time and part-time basis through its
extensive affiliate network. My Family TV is a network created for American families, broadcasting in 80-90 markets throughout the United
States.




Since acquisition, the network has expanded by signing
affiliation agreements that place My Family TV into major markets including San Francisco, Houston, Miami, Dallas, Phoenix, Detroit, Tampa, and
Charlotte. My Family TV will continue this expansion in 2011 by implementing an aggressive sales and marketing plan to launch the network in additional
major markets across the country.




With the acquisition of My Family TV, we now have a library
of over 1,000 films, over 200 episodic TV series and more than 500 individual TV one-off specials and documentary programs.




The purchase price included 100,000 shares of convertible
preferred stock valued at $9,000 based on an as if converted basis; 1,500,000 shares of common stock valued at $59,400 based on the
Companys quoted stock price; cash payments totaling $661,092. The total adjusted purchase price was $729,492. In September of 2009, ValCom made
the final payment and now owns the television network 100% debt free.




INTERACTIVE TECHNOLOGY




The Company has experience in the interactive
communications and entertainment fields, which brings together elements of the TV and telecom industry. During the year, ValCom facilities produced
major live interactive TV shows and reality TV based games shows including such shows as BETs ‘Take the Cake which was
broadcast live 5 night a week from the studios Burbank facility.
It has created and broadcast interactive




4


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national and international television programs using state-of-the-art computer technology, satellite
communications, and advanced telecommunications systems. The Companys management believes that its experience in developing and delivering
interactive television programs, will enhances its ability to launch new entertainment and information programs based on comparable
resources.




PATENTS, TRADEMARKS, COPYRIGHTS, LICENSES, FRANCHISES,
CONCESSIONS, ROYALTY AGREEMENTS OR LABOR CONTRACTS, INCLUDING DURATION




The Company has no patent rights. It has the following
service marks:




MYFAMILY TV




International Class 41, Granted registration number
77631826 on December 12, 2008 to ValCom Inc., 10 years.




SATELLITE BINGO:




International Class 41 (production and distribution of
television game shows) granted Registration Number 1,473,709 on January 19, 1988 to Satellite Bingo, Inc. 20 years.




HANGIN WITH THE BOYZ:




International Class 25 (Clothing) and 41 (Production and
distribution of television game shows) application filed on March 1, 2000, Serial NO.75/932,583,




WHO CAN YOU TRUST?




Mark granted March 9, 1999 for 20 years International Class
41 (production and distribution of television game shows) serial NO.75/485225,




FUHGEDABOWDIT:




International Class 41 (production and distribution of
television game shows) Serial NO. 75/784,763 application filed on August 26, 1999.




ULTIMATE DRIVER:




The Company applied for registration of copyright of
Ultimate Driver in October, 2002.




FINAL ROUND FIGHT FILM:registered under the
Writers Guild of America (WGA).




The Company applied for registration of copyright of
The Final Round-The Gabriel Ruelas Story on December 2, 2000.




The Company obtained an assignment to a copyright for
The Works, copyright registrations for Globalot Bingo and derivatives: Number PAU 855-931 (June 10,1986); Number Pau 847-876 (March 11,
1986); Number PAU 788-031 (September 19,1985); Number PAU 927-410 (November 4, 1986); Number PA 370-721 (February 9,1988); Number PA 516-494 (January
17, 1991); Number PA 533-697 (January 17,1991); from Satellite Bingo, Inc. to SBI Communications, Inc., dated September 14, 1993.




The Company applied for registration of copyright of
The Final Round-The Gabriel Ruelas Story on December 2, 2000. The Company obtained an assignment of copyright of The Life, Txu
744-678 June 12, 1996. The Company obtained a copyright by assignment of PCH Pau 2-040-426 September 12, 1995.




HEADLIGHTS AND TAILPIPES




Live Theater Show Debut and Stardust Casino: Broadcast,
merchandise and food/beverages.




SIN CITY RECORDS




Record Studio, Record Label, publishing, music, television,
films and merchandise




5


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MOTOWN PARTNERS, LLC




Live Theatre, Production Revenue and
Concerts




EMPLOYEES




As of September 30, 2010, the Company had 9 full-time
employees, including one officer and three professional staff. No employee of the Company is represented by a labor union or is subject to a collective
bargaining agreement. We have never experienced a work stoppage and believe our employee relations are very good.




ITEM 1A.  RISK FACTORS




RISKS ASSOCIATED WITH OUR OPERATIONS




WE WILL REQUIRE ADDITIONAL FUNDS TO ACHIEVE OUR CURRENT
BUSINESS STRATEGY AND OUR INABILITY TO OBTAIN ADDITIONAL FINANCING COULD CAUSE US TO CEASE OUR BUSINESS OPERATIONS.




We will need to raise additional funds through public or
private debt or sale of equity to achieve our current business strategy. Such financing may not be available when needed. Even if such financing is
available, it may be on terms that are materially adverse to your interests with respect to dilution of book value, dividend preferences, liquidation
preferences, or other terms. Our capital requirements to implement our business strategy will be significant. However, at this time, we cannot
determine the amount of additional funding necessary to implement such plan. We anticipate requiring additional funds in order to fully implement our
business plan to significantly expand our operations. We may not be able to obtain financing if and when it is needed on terms we deem acceptable. Our
inability to obtain financing would have a material negative effect on our ability to implement our acquisition strategy, and as a result, could
require us to diminish or suspend our acquisition strategy.




If we are unable to obtain financing on reasonable terms,
we could be forced to delay, scale back or eliminate certain product and service development programs. In addition, such inability to obtain financing
on reasonable terms could have a material negative effect on our business, operating results, or financial condition to such extent that we are forced
to restructure, file for bankruptcy, sell assets or cease operations, any of which could put your investment dollars at significant
risk.




IT IS LIKELY THAT ADDITIONAL SHARES OF OUR STOCK WILL BE
ISSUED IN THE NORMAL COURSE OF OUR BUSINESS DEVELOPMENT, WHICH WILL RESULT IN A DILUTIVE EFFECT ON OUR EXISTING SHAREHOLDERS.




We will issue additional stock as required to raise
additional working capital in order to secure intellectual properties, undertake company acquisitions, recruit and retain an effective management team,
compensate our officers and directors, engage industry consultants and for other business development activities.




IF WE FAIL TO ADEQUATELY MANAGE OUR GROWTH, WE MAY NOT BE
SUCCESSFUL IN GROWING OUR BUSINESS AND BECOMING PROFITABLE.




We expect our business and number of employees to grow over
the next year. We expect that our growth will place significant stress on our operation, management, employee base and ability to meet capital
requirements sufficient to support our growth over the next 12 months. Any failure to address the needs of our growing business successfully could have
a negative impact on our chance of success.




IF WE ACQUIRE OR INVEST IN OTHER BUSINESSES, WE WILL FACE
CERTAIN RISKS INHERENT IN SUCH TRANSACTIONS.




We may acquire, make investments in, or enter into
strategic alliances or joint ventures with, companies engaged in businesses that are similar or complementary to ours. If we make such acquisitions or
investments or enter into strategic alliances, we will face certain risks inherent in such transactions. For example, we could face
difficulties in managing and integrating newly acquired operations.
Additionally, such transactions




6


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would divert management resources and may result in the loss of artists or songwriters from our rosters. We cannot
assure you that if we make any future acquisitions, investments, strategic alliances or joint ventures that they will be completed in a timely manner,
that they will be structured or financed in a way that will enhance our creditworthiness or that they will meet our strategic objectives or otherwise
be successful. Failure to effectively manage any of these transactions could result in material increases in costs or reductions in expected revenues,
or both.




PENNY STOCK RULES MAY MAKE BUYING OR SELLING OUR
COMMON STOCK DIFFICULT.




Trading in our securities is subject to the penny
stock rules. The SEC has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than
$5.00 per share, subject to certain exceptions. These rules require that any broker-dealer who recommends our securities to persons other than prior
customers and accredited investors, must, prior to the sale, make a special written suitability determination for the purchaser and receive the
purchasers written agreement to execute the transaction. Unless an exception is available, the regulations require the delivery, prior to any
transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny
stock market. In addition, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current
quotations for the securities they offer. The additional burdens imposed upon broker- dealers by such requirements may discourage broker-dealers from
effecting transactions in our securities, which could severely limit the market price and liquidity of our securities. Broker-dealers who sell penny
stocks to certain types of investors are required to comply with the Commissions regulations concerning the transfer of penny stocks. These
regulations require broker-dealers to:


| |  | Make a suitability determination prior to selling a penny stock
to the purchaser;
|- |  | ---------------------------------------------------------------------------------

| |  | Receive the purchasers written consent to the transaction;
and
|- |  | ---------------------------------------------------------------

| |  | Provide certain written disclosures to the purchaser.
|- |  | -----------------------------------------------------



RISKS ASSOCIATED WITH THE ENTERTAINMENT, MEDIA AND
COMMUNICATIONS INDUSTRIES COMPETITION FROM PROVIDERS OF SIMILAR PRODUCTS AND SERVICES COULD MATERIALLY ADVERSELY AFFECT OUR REVENUES AND FINANCIAL
CONDITION.




The industry in which we compete is a rapidly evolving,
highly competitive and fragmented market, which is based on consumer preferences and requires substantial human and capital resources. We expect
competition to intensify in the future. There can be no assurance that we will be able to compete effectively. We believe that the main competitive
factors in the entertainment, media and communications industries include effective marketing and sales, brand recognition, product quality, product
placement and availability, niche marketing and segmentation and value propositions. Many of our competitors are established, profitable and have
strong attributes in many, most or all of these areas. They may be able to leverage their existing relationships to offer alternative products or
services at more attractive pricing or with better customer support. Other companies may also enter our markets with better products or services,
greater financial and human resources and/or greater brand recognition. Competitors may continue to improve or expand current products and introduce
new products. We may be perceived as relatively too small or untested to be awarded business relative to the competition. To be competitive, we will
have to invest significant resources in business development, advertising and marketing. We may also have to rely on strategic partnerships for
critical branding and relationship leverage, which partnerships may or may not be available or sufficient. We cannot assure that it will have
sufficient resources to make these investments or that we will be able to make the advances necessary to be competitive. Increased competition may
result in price reductions, reduced gross margin and loss of market share. Failure to compete successfully against current or future competitors could
have a material adverse effect on the Companys business, operating results and financial condition.




7


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THE SPECULATIVE NATURE OF THE ENTERTAINMENT, MEDIA AND
COMMUNICATIONS INDUSTRY MAY RESULT IN OUR INABILITY TO PRODUCE PRODUCTS OR SERVICES THAT RECEIVE SUFFICIENT MARKET ACCEPTANCE FOR US TO BE
SUCCESSFUL.




Certain segments of the entertainment, media and
communications industry are highly speculative and historically have involved a substantial degree of risk. For example, the success of a particular
film, program or recreational attraction depends upon unpredictable and changing factors, including the success of promotional efforts, the
availability of alternative forms of entertainment and leisure time activities, general economic conditions, public acceptance and other tangible and
intangible factors, many of which are beyond our control. If we complete a business combination with a target business in such a segment, we may be
unable to produce products or services that receive sufficient market acceptance for us to be successful.




CHANGES IN TECHNOLOGY MAY REDUCE THE DEMAND FOR THE PRODUCTS
OR SERVICES WE MAYOFFER FOLLOWING A BUSINESS COMBINATION.




The entertainment, media and communications industries are
substantially affected by rapid and significant changes in technology. These changes may reduce the demand for certain existing services and
technologies used in these industries or render them obsolete. We cannot assure you that the technologies used by or relied upon or produced by a
target business with which we effect a business combination will not be subject to such occurrence. While we may attempt to adapt and apply the
services provided by the target business to newer technologies, we cannot assure you that we will have sufficient resources to fund these changes or
that these changes will ultimately prove successful.




IF OUR PRODUCTS OR SERVICES THAT WE MARKET AND SELL ARE NOT
ACCEPTED BY THEPUBLIC, OUR PROFITS MAY DECLINE.




Certain segments of the entertainment, media and
communications industries are dependent on developing and marketing new products and services that respond to technological and competitive
developments and changing customer needs and tastes. We cannot assure you that the products and services of a target business with which we effect a
business combination will gain market acceptance. Any significant delay or failure in developing new or enhanced technology, including new product and
service offerings, could result in a loss of actual or potential market share and a decrease in revenues.




THE TV BROADCASTING INDUSTRY IS EXTREMELY COMPETITIVE AND
REQUIRES CONTINUES INVESTMENT IN NEW TECHNOLOGY, MARKETING, CARRIAGE AND IN NEW PROGRAMMING




The TV broadcast industry continues to be under severe
pressure with declining advertising revenues and a very competitive environment. At the same time, the viewer are seeking continued technology
improvements such as High Definition broadcast which requires continued investment and higher costs of operation. The investment required for this and
the additional investment in improved programming cannot guarantee that the broadcast networks will retain its viewing audience or be attractive for
advertisers in the future.




IF OUR REAL ESTATE WE SELL BY LIVE TV AUCTION OR BY DIRECT
SALE IS NOT ACCEPTED BY THE MARKET OR CARRIES ANY RESIDUAL LIABILITY, THIS MAY HAVE AN ADVERSEEFFECT ON OUR PROFITS.




There is no guarantee that the TV auction sales or other
real estate sales will be successful, or that the company will be able to continue to source properties suitable for live TV auction sales or that
these properties, due to the fact that most of these are foreclosed properties, may carry some contingent or other liability.




ITEM 2.  PROPERTIES




ValCom also holds a 1/3 equity interest in the real estate
of 7.5 acres, 160,000 square feet of commercial space.




8


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ITEM 3  LEGAL PROCEEDINGS




Any significant legal action involving the Company during
the financial year and ongoing is set out below. The company also pursues legal action where appropriate in the normal course of business such as for
the collection of receivables or in the defense of frivolous claims on the company.




The Company filed suit against AAN (Americas Auction
Network) and Jeremiah Hartman for Breach of Agreement pertaining to Real Estate Auctions. In the first quarter, the Company advertised and introduced
AAN to a third party bank the foreclosed homes and jointly marked them for three successful auctions and was to be reimbursed for advertising and
expenses and 25% of the profits. No trial date has been set as of yet.




In March 2010 Mr. Powers was terminated for cause. Mr.
Powers took the company to arbitration. In the first quarter of 2011, the Arbitrator ruled that the Company was to pay 1/3 of Mr. Powers
contract. The Company is making arrangements to pay the Arbitrators award. Mr. Powers resigned as aboard member two weeks after his
termination.




The Company filed suit in January 2011 against Chameleon
Communications and Frankie Buddy Winsett for non payment of 14 months of rent, six months of employee payroll and 10% ownership in the
studio in which ValCom managed, besides other expenses. No trail date has been set as of yet.




CHAPTER 11 BANKRUPTCY




During August 2008, the Company emerged from bankruptcy
following approval of a plan of re-organization by the United States Bankruptcy Court, Central District of California on August 5, 2008 and during 2008
and 2009 completed the approved plan of re-organization.




ValCom had filed a voluntary chapter 11 bankruptcy petition
on July 14, 2007 and obtained the status of Debtor in Possession. ValCom had initiated a suit against Chicago Title and The Laurus Master Fund in
October 2005 because it claimed that Laurus and Chicago Title had retained the $500,000 overage arising out of the proceeding in 2003/4. Subsequently,
the trial court entered summary judgment in favor of Chicago Title and Laurus. ValCom appealed, contending that there were triable issues as to
whether: (1) ValCom suffered damages;(2)Chicago Title and Laurus violated Civil Code sections 2924K, 2924d, and 2924h; and (3) Chicago Title breached
its duties as the foreclosure trustee.




Additionally, at the time that the trial court granted
Summary Judgment against ValCom, the trial court awarded costs and attorney fees of $562,127.30, and ValCom argued in its appeal that Chicago Title was
not entitled to attorney fees, and that the attorney fees awarded to Laurus were excessive.




Prior to the filing of the Chapter 11 bankruptcy, ValCom
attempted to obtain a stay against enforcement of the attorney fees and costs judgment awarded to Chicago Title and Laurus pending appeal. ValCom was
unable to prove to the trial courts satisfaction that the value of ValComs assets was sufficient to protect Chicago Title and Laurus
judgment. The Court denied ValComs attempt to use its property in lieu of a cash bond, and threatened with enforcement of the judgment, ValCom
had no choice but to file for the protection of the bankruptcy court.




ValCom, through appeals counsel, filed an appeal, and oral
argument on the appeal occurred December 17, 2007. On February 13, 2008, subsequent to the Debtors status conference in bankruptcy court, the
Court of Appeals for the Second Appellate District, Division Two, case number B193714, ruled in favor of ValCom, Inc.




LAURUS MASTER FUND AND CHICAGO TITLE




ValCom had initiated an action against Chicago Title and
The Laurus Master Fund in October 2005 because it claimed that Laurus and Chicago Title had retained the $500,000 overage arising out of the proceeding
in 2003/4. Subsequently, thetrial court entered summary judgment in favor of Chicago Title and Laurus. ValCom appealed, contending that there were
triable issues as to whether: (1) ValCom suffered damages;(2) Chicago Title and Laurus violated Civil Code sections 2924K, 2924d, and 2924h;and
(3)Chicago Title breached its duties as the foreclosure trustee. Additionally, at the time that the trial court granted Summary Judgment against
ValCom, the trial court awarded costs and attorney fees of $562,127.30, and ValCom argued in its appeal that Chicago Title was not entitled to attorney
fees, and that the attorney fees awarded to Laurus were excessive.




9


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ValCom, through appeals counsel, filed an appeal, and oral
argument on the appeal occurred December 17, 2007. On February 13, 2008, subsequent to the Debtors status conference in bankruptcy court, the
Court of Appeals for the Second Appellate District, Division Two, case number B193714, ruled in favor of ValCom Inc.




ValCom has reasserted its claim against Laurus and Chicago
Title for money damages based upon a foreclosure conducted by them. The case is set for trial on April 6, 2009. No action or claim has been asserted
against ValCom by these defendants.




On March 24, 2009, ValCom and Laurus Master Fund, Ltd, a
company organized under the laws of the Cayman Islands and Chicago Title Company, a California Corporation entered into a Settlement Agreement whereby
ValCom resolved its previously asserted claims against Laurus and Chicago Title. Pursuant to the terms of the Agreement, Laurus agrees to pay the
Company five hundred and fifty thousand dollars ($550,000) which was received by the Companys attorney on March 30th. Within ten calendar days
after the Company receives payment from Laurus, the Company filed a Request for Dismissal of its claims, with prejudice, of its actions against Laurus
and Chicago Title and Chicago Title. This settlement is reflected as ‘Other Income with full accrual made for legal costs relating to the
settlement.




VALCOM, INC. V. TTL PRODUCTIONS, INC., TROY LINGER, CHRIS
LENTO DBA BRENTWOOD MAGAZINE




Case number SC094099. This matter involves breach of
contract and fraud against the Defendants for $380,000 filed on June 1, 2007 in the Superior Court of Los Angeles, Santa Monica District alleging
breach of contract, specific performance, injunctive relief, declaratory relief, accounting and negligence.




In this matter, ValCom is the plaintiff and sued the
defendants for breach of contract with respect to ValComs purchase of Brentwood Magazine. This matter is currently scheduled for a post-mediation
conference on February 4, 2009 and the parties subsequently reached agreement and settlement on this matter.




ITEM 4  SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS




NONE.




10


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PART II




ITEM 5.  MARKET FOR REGISTRANTS COMMON EQUITY,
RELATED STOCKHOLDER MATTERS ANDISSUER PURCHASES OF EQUITY SECURITIES




MARKET FOR COMMON EQUITY.




The Companys common stock is traded on the NASD
Over-the-Counter Electronic Bulletin Board under the symbol VLCO upon the effectuation of a one-for-twenty reverse stock split on December 11, 2006.
The Companys common stock was previously traded on the NASD Over-the-Counter Electronic Bulletin Board under the symbol VACM. The Companys
trading symbol on the Frankfurt XETRA is VAM and its security code is #940589.




The following table sets forth in United States dollars the
high and low bid and ask quotations for the Companys common stock for each quarter within the last two fiscal years. Such bid and ask quotations
reflect inter-dealer prices, without retail mark-up, mark-down or commissions, and do not necessarily represent actual transactions. The source of the
following information is the NASD Over-the-Counter Electronic Bulletin Board.




COMMON STOCK







|Year to September 30 2010 |  |  |  | Low |  | High
|------------------------- |  |  |  | --- |  | ----
|First
Quarter             |  |  |  | $   |  |     
|Second
Quarter            |  |  |  | $   |  |     
|Third
Quarter             |  |  |  | $   |  |     
|Fourth
Quarter            |  |  |  | $   |  |     
|                          |  |  |  |     |  |     
|Year to
September 30 2008 |  |  |  |     |  |     
|First
Quarter             |  |  |  | $   |  |     
|Second
Quarter            |  |  |  | $   |  |     
|Third
Quarter             |  |  |  | $   |  |     
|Fourth
Quarter            |  |  |  | $   |  |     
|                          |  |  |  |     |  |     
|Year to
September 30 2007 |  |  |  |     |  |     
|First
Quarter             |  |  |  | $   |  |     
|Second
Quarter            |  |  |  | $   |  |     
|Third
Quarter             |  |  |  | $   |  |     
|Fourth
Quarter            |  |  |  |     |  |     
|                          |  |  |  |     |  |     
|Year to
September 2006    |  |  |  |     |  |     
|First
Quarter             |  |  |  | $   |  |     
|Second
Quarter            |  |  |  | $   |  |     
|Third
Quarter             |  |  |  | $   |  |     
|Fourth
Quarter            |  |  |  | $   |  |     



Prices quoted reflect a one share-for-twenty reverse split
effective on February 1, 1993, a two share-for-one forward split effective on August 14, 2000, a one share-for-ten reverse split effective on September
27, 2001 and a one-for-twenty reverse split effective on December 11, 2006.




As of September 30, 2010, we had
 shares of common stock outstanding, with approximately  million
shares in the public float and approximately  shareholders of record.




11


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DIVIDENDS




There have been no cash dividends declared or paid since
the inception of the Company. Continental Stock Transfer & Trust Company, 17 Battery Place; New York, New York 10004, acts as transfer agent and
registrar for the Companys common and preferred stock.




DESCRIPTION OF SECURITIES




The Company is authorized to issue 275,000,000 shares of
capital stock, 250,000,000 shares of which are designated as common stock, $0.001 par value per share, and the balance of which are designated as
preferred stock, $0.001 par value per share.




The holders of common stock do not have cumulative voting
rights and are entitled to one vote per share on all matters to be voted upon by the stockholders. Our common stock is not entitled to preemptive
rights and is not subject to redemption (including sinking fund provisions) or conversion. Upon our liquidation, dissolution or winding-up, the assets
(if any) legally available for distribution to stockholders are distributable ratably among the holders of our common stock after payment of all
classes or series of our preferred stock. All outstanding shares of our common stock are validly issued, fully-paid and non-assessable. The rights,
preferences and privileges of holders of our common stock are subject to the preferential rights of all classes or series of preferred stock that we
may issue in the future.




PREFERRED STOCK




At September 30, 2009, the Company had three series of
convertible preferred stock: B, C and D. Series B Preferred Stock has no voting rights, is entitled to receive cumulative dividends in preference to
any dividend on the common stock at a rate of 10% per share, per year, to be issued if and when declared by the Board of Directors and can be converted
at any time into common stock on a one for five basis. In the event of any liquidation, the holders of shares of Series B Preferred Stock then
outstanding shall be entitled to receive an amount equal to the purchase price per share, plus an amount equal to declared but unpaid dividends
thereon, if any, to the date of payment. Series C Preferred Stock has no voting rights, is entitled to receive cumulative dividends in preference to
any dividend on the common stock at a rate of 10% per share, per year, to be issued if and when declared by the Board of Directors and can be converted
at any time into common stock on a one for one basis. In the event of any liquidation, the holders of shares of Series C Preferred Stock then
outstanding shall be entitled to receive an amount equal to the purchase price per share, plus an amount equal to declared but unpaid dividends
thereon, if any, to the date of payment. Series D Preferred Stock has no voting rights, no dividends and can be converted at any time to common stock
on a one for one basis. In the event of any liquidation, the holder of shares of Series C Preferred Stock then outstanding shall be entitled to receive
an amount equal to the purchase price per share. With respect to rights on liquidation, Series B, C and D Preferred Stock shall rank senior to the
common stock but Series C Preferred Stock shall be senior to both Series B and D Preferred Stock while Series D Preferred Stock shall be junior to both
Series Band C Preferred Stock. The Board of Directors has not declared any dividends for any of the series of convertible preferred
stock.




EQUITY COMPENSATION PLAN




The Company has a 2004 Employee Stock Compensation Plan
(the ESCP) to enhance its ability to attract, retain and compensate experienced employees, officers, directors and consultants. The
effective date of the ESCP is January 10, 2004. A total of 2,000,000 shares of common stock were registered for issuance under the ESCP on Form S-8
registration statement filed December 30, 2003. Pursuant to the ESCP, the Compensation Committee or the Board of Directors may award registered shares
of the Companys common stock to employees, officers, directors or consultants for cash, property, services rendered or other form of payment
constituting lawful consideration. Plan shares awarded for other than services rendered shall be sold at not less than fair market value on the date of
grant. During the fiscal year ended September 30, 2004, the Company issued an aggregate of 1,000,000 shares of registered common stock to employees,
officers, directors and consultants pursuant to the ESCP for services rendered.




The following table shows information with respect to each
equity compensation plan under which our common stock is authorized for issuance as of the fiscal year ended September 30, 2010.




12


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EQUITY COMPENSATION PLAN INFORMATION.







|PLAN CATEGORY                                              |  |  |  | NUMBER OF SECURITIES REMAINING AVAILABLE
PLANS FOR FUTURE ISSUANCE UNDER EQUITY PLANS (EXCLUDING SECURITIES REFLECTED IN COLUMN (A) |  | NUMBER OF SECURITIES TO BE ISSUED UPON
EXERCISE OF OUTSTANDING OPTIONS, WARRANTS AND RIGHTS (B) |  | WEIGHTED AVERAGE EXERCISE PRICE OF OUTSTANDING
OPTIONS, WARRANTS AND RIGHTS (C)
|---------------------------------------------------------- |  |  |  | ----------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------
|EQUITY
COMPENSATION PLANS APPROVED BY SECURITY HOLDERS     |  |  |  |                                                                                                                                     |  |                                                                                                 |  |                                                                                
|EQUITY
COMPENSATION PLANS NOT APPROVED BY SECURITY HOLDERS |  |  |  |                                                                                                                                     |  |                                                                                                 |  |                                                                                
|TOTAL                                                      |  |  |  | Nil                                                                                                                                 |  | Nil                                                                                             |  | Nil                                                                            



RECENT ISSUANCES OF UNREGISTERED
SECURITIES


|(A) |  | COMMON STOCK
|--- |  | ------------



The Company claims an exemption from the registration
requirements of the Act for the issuance of the Preferred Stock and Common Stock, as set forth above, pursuant to Section 4(2) of the Act and/or
Regulation D promulgated thereunder since, as among other things, the transaction did not involve a public offering, the investors and/or purchasers
were each an accredited investor and/or qualified institutional buyer, the investors had access to information about the Company and their investment,
the investors took the preferred and common stock for investment and not resale and the Company took appropriate measures to restrict the transfer of
the preferred and common stock.




ITEM 6.  SELECTED FINANCIAL
DATA




Not applicable.




ITEM 7.  MANAGEMENTS DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS




SPECIAL NOTE ON FORWARD-LOOKING
STATEMENTS.




Certain statements in Managements Discussion
and Analysis or Plan of Operation below, and elsewhere in this annual report, are not related to historical results, and are forward-looking
statements. Forward-looking statements present our expectations or forecasts of future events. You can identify these statements by the fact that they
do not relate strictly to historical or current facts. These statements involve known and unknown risks, uncertainties and other factors that may cause
our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance
or achievements expressed or implied by such forward-looking statements. Forward-looking statements frequently are accompanied by such words such as
may, will, should, could, expects, plans, intends,
anticipates, believes, estimates, predicts, potential or continue, or the
negative of such terms or other words and terms of similar meaning. Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of activity, performance, achievements, or timeliness of such results. Moreover,
neither we nor any other person assumes responsibility for the accuracy and completeness of such forward-looking statements. We are under no duty to
update any of the forward-looking statements after the date of this annual report. Subsequent written and oral forward looking statements attributable
to us or to persons acting in our behalf are expressly qualified in their entirety by the cautionary statements and risk factors set forth below and
elsewhere in this annual report, and in other reports filed by us with the SEC.




13


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INTRODUCTION




PLAN OF OPERATION




As of September 30, 2010, ValCom, Incs operations
were comprised of the following activities:


|1. |  | BROADCASTING
|-- |  | ------------



On August 1, 2008, ValCom signed a letter of intent to
acquire 100% of Faith TVLLC, a Christian TV network operating through 65 television broadcast affiliates and through IPTV & LPTV networks. On
December 15, 2008, ValCom closed the agreement for the 100% purchase of Faith TV and has re-branded the network and launched it as My Family
TV, a new family focused TV network with plans to add significantly more broadcast affiliates. My Family TV is a strong family oriented network
with a core established audience and broadcasts to over 50 million households on full-time and part-time through its extensive affiliate network. My
Family TV is a new network created for American families, broadcasting over 80 movies per month and in July 2009 launched Kid Mango, a daily 3 hour
kids block in a venture with Porchlight Entertainment which is carried on Sky Angel, iLife and on the ION digital channel and featuring major kids
programs including Emmy Award winning titles such as Jakkers, Jay Jay theJet Plane and Denis the Menace.




With the acquisition of My Family TV, ValCom now has a
library of over 1,000films, over 200 episodic TV series and more than 500 individual TV one-off specials and documentary programs.




Through our joint venture with New Global Communications,
Inc., we own a 45% equity interest in ValCom Broadcasting, LLC, a New York limited liability company, which operates KVPS (Channel 8), an independent
television broadcaster in the Palm Springs, California market. ValCom has not realized significant revenues from this joint venture to
date.




On December 15, 2008, we acquired 100% of Faith TV LLC, a
Christian TV network operating through 65 television broadcast affiliates and through IPTV & LPTV networks. Upon closing, we re-branded the network
and launched it as My Family TV, a new family focused TV network with plans to add significantly more broadcast affiliates. My Family TV is
a strong family oriented network with a core established audience that broadcasts to almost 30m households on full-time and part-time basis through its
extensive affiliate network. My Family TV is a network created for American families, broadcasting in 80-90 markets throughout the United
States.




Since acquisition, the network has expanded by signing
affiliation agreements that place My Family TV into major markets including San Francisco, Houston, Miami, Dallas, Phoenix, Detroit, Tampa, and
Charlotte. My Family TV will continue this expansion in 2011 by implementing an aggressive sales and marketing plan to launch the network in additional
major markets across the country.




With the acquisition of My Family TV, we now have a library
of over 1,000 films, over 200 episodic TV series and more than 500 individual TV one-off specials and documentary programs.




The purchase price included 100,000 shares of convertible
preferred stock valued at $9,000 based on an as if converted basis; 1,500,000 shares of common stock valued at $59,400 based on the
Companys quoted stock price; cash payments totaling $661,092. The total adjusted purchase price was $729,492. In September of 2009, ValCom made
the final payment and now owns the television network 100% debt free.


|2. |  | FILM AND TV PROGRAM PRODUCTION DIVISION
|-- |  | ---------------------------------------



ValComs business includes television production for
network and syndication programming, motion pictures, and real estate holdings. Revenue is primarily generated through the lease of the sound stages
and production. Our past and present clients include Paramount Pictures, Don Belisarious Productions, Warner Brothers, Universal Studios, MGM, HBO,
NBC, 20th Century Fox, Disney, CBS, Sony, Showtime, the USA Network, the Game Show Network, Endemol, BET Home Shopping Network and Sullivan
Studios.




ValCom has a long history of TV and film production and
continuously develops projects for productions and considers proposals for co-production. ValCom has developed and produced a number of live action
series pilots and full length feature film projects such as PCH (Pacific Coast Highway) and the 40 episode TV series AJs Time Travelers. ValCom has been commissioned to produce
pilots such as Truster for Fox,




14


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It also produces development pilots itself for pitching to networks such as the New York based sitcom Fuhgedabowit and
Lets Do It Again featuring Frankie Avalon. With its integrated studio operation, studio equipment and post production facility, ValCom has the
opportunity to co-produce by way of the provision of services with the opportunity to defer costs and also to provide executive producer services to
assist with development, planning, financing and distribution.




Over the last 25 years the company has been producing and
acquiring movies, Television Shows and Music titles and to date, have comprised an impressive list of almost 5,000 titles and has now started to put
them in the market by leasing the titles to TV networks, iTunes, On Demand while continuing to seek new media options. There has already been a major
interest through some of the biggest names in the entertainment industry. ValCom also plans on remaking some of the older titles. The company is in the
process of having all of its content appraised.




October 1, 2003, we formed New Zoo Revue LLC pursuant to a
joint venture agreement with O Atlas Enterprises Inc., a California corporation. New Zoo Revue, LLC was formed for the development and production of
New Zoo Revue a feature film and television series and marketing of existing episodes. The company did not proceed with the production of
the new feature film or series but in 2004, it did complete a distribution agreement for the DVD with BCI Eclipse for 183 episodes of the New Zoo Revue
library. ValCom has not realized significant revenues from animation to date.




In 2009, ValCom produced the documentary feature film
‘Michel LeGrand is Music. The documentary pays tribute to Michel LeGrands five-decade, multiple award-winning career composing many
of the most memorable film and television scores and songs of all time. ValCom Inc. will premiere the documentary in a limited week-long theatrical run
in New York City on September 18th at the Coliseum Theater. In addition, the documentary will premiere in Los Angeles on September 16th at the Laemmle
Grand Cineplex 4. Michel LeGrand Is Music honors the work of the three-time Academy Award-winning French music composer, arranger,
conductor and pianist Michel LeGrand. LeGrand composed more than 200 film and television scores and numerous jazz, popular and classical musical
albums. He won Academy Awards for Best Music, Original Song for The Windmills of Your Mind from The Thomas Crown Affair (1969),
Best Music, Original Dramatic Score for Summer of ‘42 (1971) and Best Music, Original Song for Barbra Streisand Movie
Yentl (1983). Academy Award-winning actor Jon Voight narrates the documentary.


|3. |  | LIVE THEATRE AND EVENT DIVISION
|-- |  | -------------------------------



ValCom has a live theatre division responsible for bringing
live shows and events to fruition. In 2006, ValCom produced a theater production called ‘Headlights and Tailpipes which was unveiled at the
Las Vegas Stardust hotel and ran until July 2006. Other events produced included the 2006 Superbowl pre-game Rap Bowl Event featuring Young Jeezy,
Academy Award winner Ludacris, Juvenile and Juelz Santana.




ValCom produced a live theatre event based on Michel
LeGrand and his music scheduled which debuted March 2010 at the MGM Grand, Las Vegas and featuring a line-up of major international recording stars
such as Sting, George Benson, Melissa Manchester, Dion Warwick, Frank Sinatra Jr, Patti Page and Jerry Lewis. The show was also shot for Television and
licensed to PBS for two years for a $200,000 fee.


|4. |  | DISTRIBUTION
|-- |  | ------------



ValCom, through Valencia Entertainment International
operates a complete distribution and syndication service to producers and thus acquire content for its networks at little or no cost with its ability
to guarantee TV broadcast and provide a launch for further home entertainment distribution on DVD and on-demand channels through it other
relationships. ValCom also has the opportunity to co-produce film and TV programs by way of the provision of services with the opportunity to defer
costs and also to provide executive producer services to assist with development, planning, financing and then be able to acquire distribution rights
for these productions.




ValCom owns a substantial library of television content
with over 1000 films and it also acquires third party film and TV programming which it distributes through Valencia Entertainment
International.




Valencia Entertainment was once a very successful
distributor of ValComs content of Movies and Television shows. In its first years of selling the content, it sold millions of dollars in
licensing fees. ValCom has determined that the time is right to take the product out to the market this




15


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year
 and relive the success story of selling its content that is now starting to be utilized on its TV Network, My Family TV. The Company just
finished its first of many tradeshows and seems to have had a great response at NATPE this year in Miami, FL and has already put out several
proposals.




On November 6, 2007, Valencia Entertainment signed an
agreement with Porchlight Distribution Inc. from Santa Monica Blvd., Los Angeles, for the worldwide distribution of all 40 episodes of A.J.s Time
Travelers.




In December 2008, ValCom signed a production and
distribution agreement with XFC, the mixed martial arts promoter for the editing and world-wide distribution of 13 one hour shows featuring live events
promoted by XFC. XFC events are currently attracting the largest audiences of any mixed martial arts events promoted in the US.




To coincide with the Michel LeGrand live events in Las
Vegas in 2010, ValCom is planning a number of distribution opportunities including the distribution and syndication of programming based on the live
event, music recordings, album and other related events.


|5. |  | REAL ESTATE AND OTHER BROADCAST EVENT
AUCTIONS
|-- |  | ----------------------------------------------



In 2009, ValCom pioneered the process of live event
auctions covering a wide range of events for TV broadcast and live webcast. Combining the expertise in TV production, live event promotion and now as
the owner of a broadcast TV network, the opportunity offers a synergistic approach to such events. In 2008and 2009, ValCom produced a wide range live
TV and webcast events including:




1.  The Hilton
‘Make a Wish Foundation broadcast live from the Hilton mansion in Beverly Hills in December 2008




2.  The Universal
Studios ‘Battlestar Galactica prop and memorabilia auction by live web-cast in 2009 over a number of days from the Pasadena Convention
Centre




3.  The Grammy Awards
‘Music Cares auction as part of the 2009 Grammy Awards




RESULTS OF OPERATIONS




FISCAL YEAR ENDED SEPTEMBER 30, 2010 COMPARED TO FISCAL YEAR
ENDED SEPTEMBER 30, 2009




Revenues for the year ended September 30, 2010 decreased by
$ or % from $ for the year
ended September 30, 2009 to $ for the same period in 2009. The decrease in revenue was principally due
to reduced production activity.




Production costs for the year ended September 30, 2010
increased by $ or % to $ for
the year ended September 30, 2010 compared to $ for the same period in 2009. The increase in
production costs was principally due to additional direct production costs.




Advertising and marketing costs for the year ended
September 30, 2010 decreased by $ or % to
$ compared to $ for the year ended September 30,
2009. The decrease was due principally to decreased promotion spend.




Depreciation and amortization expense for the year ended
September 30, 2010 increased by $ or % from
$ for the year ended September 30, 2009 to $ for the
same period in 2009. The increase was primarily due to additional assets from the acquisition of Faith TV.




General and administrative expenses for the year ended
September 30, 2010 increased by
$ or % to $ for the year
ended September 30, 2010 from $ for the same period in 2009. The decrease was due principally to
increased costs from the acquisition of subsidiaries.




Interest expense for the year ended September 30, 2010
increased by $ or % from $
for the year ended September 30, 2010 to $ for the same period in 2009. The decrease was due
principally to reduction in interest bearing loan notes.




16


---



Due to the factors described above, the Companys net
loss increased by $ or % from a net loss of
$ for the year ended September 30, 2009 to a loss of
$ for the year ended September 30, 2010.




LIQUIDITY AND CAPITAL RESOURCES




The Companys consolidated financial statements have
been prepared assuming that the Company will continue as a going concern. As discussed in the consolidated financial statements, the Company has a net
loss of $ and a negative cash flow from operations of
$ for the year ended September 30, 2010, and an accumulated deficit of
$ at September 30, 2010.




These conditions raise substantial doubt about the
Companys ability to continue as a going concern. Cash totaled $ on September 30, 2010, compared
to $ at September 30, 2009. During the fiscal year 2010, net cash used by operating activities totaled
$ compared to $ for the year ended September 30,
2009. A significant portion of operating activities included payments for accounting and legal fees, consulting fees, salaries, and rent. Net cash
increase by financing activities for fiscal year 2010 totaled $. Net cash used by investing activities
during fiscal year 2010 totaled $ with the purchase of subsidiaries and fixed assets.




The above cash flow activities yielded a net cash increase
of $ during fiscal year 2010 compared to a net cash increase of
$ during the year ended September 30, 2009.




There can be no assurance that the Company will be able to
raise capital on terms acceptable to the Company, if at all. The total shareholders equity deficit increased to
$ in fiscal year 2010. Additional paid in capital increased by
$ in fiscal year ended September 30, 2010.




INTERNAL AND EXTERNAL SOURCES OF
LIQUIDITY




During the last fiscal year, the Company financed its
operations with cash from its operating activities and private offerings of its securities to directors of the Company. On September 15, 2008, the
Company converted $1,669,729 in debt by issuing 1,669,729 shares of Series C Preferred Stock.




The Company anticipates that its stock issuances and
projected positive cash flow from operations collectively will generate sufficient funds for the Companys operations for the next 12 months. If
the Companys existing cash combined with cash from operating activities is not adequate to finance the Companys operations during the next
12 months, the Company will consider one or more of the following options: (1) issuing equity securities in exchange for services, (2) selling
additional equity or debt securities or (3) reducing the number of its employees and reducing its operating costs.




FUTURE FUNDING REQUIREMENTS




The Companys capital requirements have been and will
continue to be significant. The Companys adequacy of available funds during the next fiscal year and thereafter will depend on many factors,
including whether the Company will be able to: (1) retain its existing tenants (2) rent its production equipment and personnel profitably, (3) develop
additional distribution channels for its programming. Assuming funds are available, during the next fiscal year, the Company expects to spend
approximately $1,000,000 for the Television Network, equipment and growth.




There can be no assurance that additional private or public
financing, including debt or equity financing, will be available as needed, or, if available, on terms favorable to the Company. Any additional equity
financing may be dilutive to stockholders and such additional equity securities may have rights, preferences or privileges that are senior to those of
the Companys existing common or preferred stock. Furthermore, debt financing, if available, will require payment of interest and may involve
restrictive covenants that could impose limitations on the operating flexibility of the Company. The Companys failure to successfully obtain
additional future funding may jeopardize its ability to continue its business and operations.




ITEM 7A  QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK




Not applicable.




17


---



ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY
DATA






Accountants Compilation
Report




Board of Directors and StockholdersValcom, Inc.




We have compiled the accompanying consolidated balance
sheets of Valcom, Inc. as of September 30, 2010, and the related consolidated statements of income, retained earnings, and cash flows for the year then
ended. We have not audited or reviewed the accompanying financial statements and, accordingly, do not express an opinion or provide any assurance about
whether the financial statements are in accordance with accounting principles generally accepted in the United States of America.




Management is responsible for the preparation and fair
presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for designing,
implementing, and maintaining internal control relevant to the preparation and fair presentation of the financial statements.




Our responsibility is to conduct the compilation in
accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. The
objective of a compilation is to assist management in presenting financial information in the form of financial statements without undertaking to
obtain or provide any assurance that there are no material modifications that should be made to the financial statements.




Labrozzi & Co., PA Miami, Florida February 7,
2011




18


---



VALCOM, INC. CONSOLIDATED BALANCE SHEETS
(UNAUDITED)







|                                                                                                                                     |  |  |  | September 30, 2010 |             | September 30, 2009
|------------------------------------------------------------------------------------------------------------------------------------ |  |  |  | ------------------ | ----------- | ------------------
|
|ASSETS                                                                                                                               |  |  |  |                    |             |                   
|Cash                                                                                                                                 |  |  |  | $                  | 18,318      |                   
|Accounts
receivable, net                                                                                                             |  |  |  |                    | 413,635     |                   
|Audio and
film library royalties receivable                                                                                          |  |  |  |                    | 2,000,000   |                   
|Due from New
Zoo Review                                                                                                              |  |  |  |                    | 20.898      |                   
|Film costs,
net of accumulated amortization                                                                                          |  |  |  |                    | 965,304     |                   
|Deferred
credits  PTL Productions                                                                                                   |  |  |  |                    | 200,000     |                   
|Property,
equipment, net of accumulated depreciation                                                                                 |  |  |  |                    | 2,544,812   |                   
|Audio and
film library                                                                                                               |  |  |  |                    | 1,653,495   |                   
|TOTAL
ASSETS                                                                                                                         |  |  |  | $                  | 7,816,462   |                   
|                                                                                                                                     |  |  |  |                    |             |                   
|LIABILITIES
AND RETAINED EARNINGS                                                                                                    |  |  |  |                    |             |                   
|Accounts
payable                                                                                                                     |  |  |  | $                  | 688,116     |                   
|Accrued
expenses                                                                                                                     |  |  |  |                    | 70,672      |                   
|Due to
Foster                                                                                                                        |  |  |  |                    | 1,500       |                   
|Due to Sin
City                                                                                                                      |  |  |  |                    | 35,000      |                   
|Deferred
revenueroyalties                                                                                                           |  |  |  |                    | 2,000,000   |                   
|Due to
related parties                                                                                                               |  |  |  |                    | 681,000     |                   
|Notes
payable                                                                                                                        |  |  |  |                    | 912,990     |                   
|Total
Liabilities                                                                                                                    |  |  |  |                    | 4,389,278   | ,                 
|                                                                                                                                     |  |  |  |                    |             |                   
|RETAINED
EARNINGS                                                                                                                    |  |  |  |                    |             |                   
|Series B
preferred stock, 1,000,000 shares authorized, $0.001 par value, 38,000 shares issued and outstanding                        |  |  |  |                    | 38          |                   
|Series C
preferred stock, 25,000,000 shares authorized, $0.001 par value, 18,691,395 shares issued and outstanding                   |  |  |  |                    | 18,691      |                   
|Common stock,
250,000,000 shares authorized, $0.001 par value, 50,138,158 and 39,064,158 shares issued and outstanding, respectively |  |  |  |                    | 50,138      |                   
|Treasury
stock, 35,000 shares                                                                                                        |  |  |  |                    | (23,522     | )                 
|Additional
paid-in capital                                                                                                           |  |  |  |                    | 16,136,533  |                   
|Accumulated
deficit                                                                                                                  |  |  |  |                    | (12,754,694 | )                 
|Total
Retained Earnings                                                                                                              |  |  |  |                    | 3,427,184   |                   
|TOTAL
LIABILITIES AND RETAINED EARNINGS                                                                                              |  |  |  | $                  | 7,816,462   |                   



The accompanying notes are an integral part of these
consolidated financial statements.




19


---



VALCOM, INC. CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)







|                                                        |  |  |  | September 30, 2010 |            | September 30, 2009
|------------------------------------------------------- |  |  |  | ------------------ | ---------- | ------------------
|
|Revenue                                                 |  |  |  |                    |            |                   
|Advertising                                             |  |  |  | $                  | 136,457    |                   
|Programming                                             |  |  |  |                    | 1,179,239  |                   
|Royalties                                               |  |  |  |                    | 500,000    |                   
|Auction                                                 |  |  |  |                    | 12,124     |                   
|Studio
rental                                           |  |  |  |                    | 60,650     |                   
|Miscellaneous                                           |  |  |  |                    | 18,840     |                   
|                                                        |  |  |  |                    |            |                   
|Total
revenue                                           |  |  |  |                    | 1,907,310  |                   
|Expenses                                                |  |  |  |                    |            |                   
|Bad
debt                                                |  |  |  |                    | 600        |                   
|Depreciation
and amortization                           |  |  |  |                    | 145,880    |                   
|General and
administrative                              |  |  |  |                    | 2,699,072  |                   
|                                                        |  |  |  |                    |            |                   
|Total
expenses                                          |  |  |  |                    | 2,845,552  |                   
|                                                        |  |  |  |                    |            |                   
|Loss before
other income (expense)                      |  |  |  |                    | (938,242   | )                 
|                                                        |  |  |  |                    |            |                   
|Other income
(expense)                                  |  |  |  |                    |            |                   
|                                                        |  |  |  |                    |            |                   
|Interest
income                                         |  |  |  |                    | 1,620      |                   
|Interest
expense                                        |  |  |  |                    | (31,407    | )                 
|Other
expenses                                          |  |  |  |                    |           |                   
|Laurus Master
Fund settlement                           |  |  |  |                    |           |                   
|                                                        |  |  |  |                    |            |                   
|Total other
income (expense)                            |  |  |  |                    | (29,787    | )                 
|                                                        |  |  |  |                    |            |                   
|Net
loss                                                |  |  |  | $                  | (968,029   | )                 
|                                                        |  |  |  |                    |            |                   
|Weighted
average shares outstanding  basic and diluted |  |  |  |                    | 41,612,121 |                   
|                                                        |  |  |  |                    |            |                   
|LOSS PER
SHARE  basic and diluted                      |  |  |  | $                  | (0.02      | )                 



The accompanying notes are an integral part of these
consolidated financial statements.




20


---



VALCOM, INC. CONSOLIDATED STATEMENT OF RETAINED
EARNINGS (UNAUDITED) September 30, 2010







|                                                                                                                                                                            |  |  |  | Series B Preferred Stock |        | Series C Preferred Stock |  | Common Stock |   
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  | ------------------------ | ------ | ------------------------ |  | ------------ | --
|
|Balances,
September 30, 2009 (Restated)                                                                                                                                     |  |  |  |                          | 38,000 |                          |  | $            | 38
|Cumulative
effect of change in accounting principle  October 1, 2009 reclassification of embedded feature of equity-linked financial instruments to
derivative liabilities |  |  |  |                          |       |                          |  |              |  
|Stock-based
compensation                                                                                                                                                    |  |  |  |                          |       |                          |  |              |  
|Sale of
common stock                                                                                                                                                        |  |  |  |                          |       |                          |  |              |  
|Debt discount
due to profit interest given with debt                                                                                                                        |  |  |  |                          |       |                          |  |              |  
|Stock issued
for accounts payable                                                                                                                                           |  |  |  |                          |       |                          |  |              |  
|Sale of
discontinued operations to related party                                                                                                                            |  |  |  |                          |       |                          |  |              |  
|Net
Loss                                                                                                                                                                    |  |  |  |                          |       |                          |  |              |  
|Balances,
June 30, 2010                                                                                                                                                     |  |  |  |                          | 38,000 |                          |  | $            | 38



The accompanying notes are an integral part of these
consolidated financial statements.




21


---








VALCOM, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)







|                                                                            |  |  |  | September 30, |           
|--------------------------------------------------------------------------- |  |  |  | ------------- | ----------
|
|OPERATING
ACTIVITIES                                                        |  |  |  |               |           
|Net
loss                                                                    |  |  |  | $             | (968,029  
|Adjustments
to reconcile net loss to net cash used in operating activities: |  |  |  |               |           
|Stock-based
compensation                                                    |  |  |  |               | 499,175   
|Depreciation
and amortization expense                                       |  |  |  |               | 145,880   
|Amortization
of debt discounts                                              |  |  |  |               | 439,792   
|Gain on
extinguishment of liabilities                                       |  |  |  |               | (2,200    
|Changes in
operating assets and liabilities:                                |  |  |  |               |           
|Accounts
receivable                                                         |  |  |  |               | (20,526   
|Royalties
receivable                                                        |  |  |  |               | (2,000,000
|Deferred
costs                                                              |  |  |  |               |          
|Film
costs                                                                  |  |  |  |               | (965,304  
|Accounts
payable and accrued expenses                                       |  |  |  |               | 135,707   
|Deferred
revenue                                                            |  |  |  |               | 2,000,000 
|Due to
related parties                                                      |  |  |  |               | 678,600   
|Net cash used
in continuing operations                                      |  |  |  |               | (56,905   
|Net cash
provided by discontinued operations                                |  |  |  |               | 18,746    
|                                                                            |  |  |  |               |           
|Net Cash Used
In Operating Activities                                       |  |  |  |               | (38,159   
|                                                                            |  |  |  |               |           
|INVESTING
ACTIVITIES                                                        |  |  |  |               |           
|Purchase of
property and equipment                                          |  |  |  |               |          
|Increase
(decrease) in restricted cash                                      |  |  |  |               |          
|                                                                            |  |  |  |               |           
|Net Cash Used
in Investing Activities                                       |  |  |  |               |          
|                                                                            |  |  |  |               |           
|FINANCING
ACTIVITIES                                                        |  |  |  |               |           
|Proceeds from
sale of common stock                                          |  |  |  |               | 100,950   
|Proceeds
(payments) on notes payable                                        |  |  |  |               | (222,782  
|Proceeds from
related party debt                                            |  |  |  |               | 45,000    
|                                                                            |  |  |  |               |           
|Net Cash
Provided by Financing Activities                                   |  |  |  |               | 76,832    
|                                                                            |  |  |  |               |           
|NET INCREASE
(DECREASE) IN CASH                                             |  |  |  |               | (114,991  
|CASH AT
BEGINNING OF YEAR                                                   |  |  |  |               | 133,309   
|                                                                            |  |  |  |               |           
|CASH AT END
OF YEAR                                                         |  |  |  | $             | 18,318    
|                                                                            |  |  |  |               |           
|SUPPLEMENTAL
DISCLOSURES OF                                                 |  |  |  |               |           
|CASH FLOW
INFORMATION                                                       |  |  |  |               |           
|CASH PAID
FOR:                                                              |  |  |  |               |           
|Interest                                                                    |  |  |  | $             |          
|Income
taxes                                                                |  |  |  |               |          



22


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VALCOM, INC. NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS (UNAUDITED)




NOTE 1. DESCRIPTION OF BUSINESS




ValCom, Inc and its subsidiaries (collectively the
Company) businesses include television production for network and syndication programming, motion pictures, and real estate holdings,
however, revenue is primarily generated through the lease of the sound stages and production, a TV network and live event broadcasting including real
estate auctions. The Companys past and present clients include movie studios and television networks. In addition to leasing its sound stages,
the Company also has a library of television content for worldwide distribution and acquired a further library of film and television series with the
acquisition of Faith TV (now renamed My Family TV) during the year.




NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES




Basis of Presentation




The accompanying consolidated financial statements have
been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (US GAAP). This
summary of significant accounting policies of the Company is presented to assist in understanding the consolidated financial statements. The
consolidated financial statements and notes are representations of the Companys management, which is responsible for their integrity and
objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently
applied in the preparation of the consolidated financial statements.




Principles of Consolidation




The consolidated financial statements include the accounts
of Valcom, Inc. and two wholly-owned subsidiaries, Valencia Entertainment, Inc. (VEI), which was acquired effective February 2001, and Faith TV, LLC
(now renamed My Family TV) which was acquired in December 2008. Investments in affiliated companies over which the Company has a significant influence
or ownership of more than 20% but less than or equal to 50% are accounted for under the equity method. The Company has no equity affiliates as of
September 30, 2010.




Fair Value Measurements and
Disclosures




ASC820 Fair Value Measurements and Disclosures,
adopted January 1, 2008, defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances
disclosure requirements for fair value measures. The carrying amounts reported in the balance sheets for current receivables and payables qualify as
financial instruments. Management concluded the carrying values are a reasonable estimate of fair value because of the short period of time between the
origination of such instruments and their expected realization and if applicable, their stated interest rate approximates current rates available. The
three levels are defined as follows:




Level 1inputs to the valuation methodology are quoted
prices (unadjusted) for identical assets or liabilities in active markets.




Level 2inputs to the valuation methodology include
quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or
indirectly, for substantially the Full term of the financial instruments.




23


---



Level 3inputs to the valuation methodology are
unobservable and significant to the fair value.




Reclassifications




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




Depreciation and
Amortization




For financial and reporting purposes, the Company follows
the policy of providing depreciation and amortization on the straight-line method over the estimated useful lives of the assets, which are as
follows:







|Production
Equipment           |  |  |  | 5
years     
|------------------------------ |  |  |  | ------------
|Office Furniture
and Equipment |  |  |  | 5 to 7
years
|Leasehold
Improvements         |  |  |  | 5
years     
|Autos and
Trucks               |  |  |  | 5
years     



Income Taxes




The Company accounts for income taxes in accordance with
ASC740 Accounting for Income Taxes. ASC 740 requires an asset and liability approach for financial accounting and reporting for income
taxes and allows recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the
asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if
it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is
uncertain.




The Company adopted the accounting standard for uncertainty
in income taxes which prescribes a comprehensive model for how a company should recognize, measure, present and disclose in its financial statements
uncertain tax positions that the Company has taken or expects to take on a tax return (including a decision whether to file or not to file a return in
a particular jurisdiction).




Shared Based Compensation




The Company accounts for stock options in accordance with
FASB ASC 718, Share-Based Payment and FASB ASC 505-50, Equity-Equity-Based Payments to Non-Employees.




Revenue Recognition




Revenue from the sales or licensing of films is recognized
upon meeting all recognition requirements of Accounting Standard Codification 926, Entertainment  Films (ASC 926) (formerly Statement
of Position 00-2). These requirements are a) persuasive evidence of a sale or licensing arrangement with a customer exists, b) the film is complete
and, in accordance with the terms of the arrangement, has been delivered or is available for immediate and unconditional delivery, c) the license
period of the arrangement has begun and the customer can begin its exploitation, exhibition, or sale, d) the arrangement fee is fixed or determinable,
and e) collection of the arrangement fee is reasonably assured.




Cash and Cash Equivalents




Cash and cash equivalents include highly liquid investments
with original maturities of three months or less that are readily convertible into cash and are not subject to significant risk from fluctuations in
interest rates. As a result, the carrying amount of cash and cash equivalents approximates fair value.




The Company places its cash and cash equivalents with major
financial institutions. At times, cash balances may be in excess of the amounts insured by the Federal Deposit Insurance Corporation
(FDIC).




24


---



Accounts Receivable




Accounts receivable represent customer obligations due
under contractual obligations where the conditions stated above in respect of revenue recognition have been fulfilled and where the customer has been
invoiced for the amount payable.




The Company evaluates accounts receivable where it believes
that there may be a possibility that the license agreement concerned may be at risk of being cancelled in the future. In these cases, the Company uses
its judgment, based on the available facts and circumstances, and records a specific reserve for that customer against amounts due to reduce the
receivable to the amount that is expected to be collected. These specific reserves are re-evaluated and adjusted as additional information is received
that impacts the amount reserved.




If circumstances change (for example, the Company
experiences higher than expected defaults or an unexpected material adverse change in a major customers ability to meet its financial obligation
to the Company), estimates of the recoverability of amounts due to the Company could be reduced by a material amount. There was no allowance for
doubtful accounts at September 30, 2010.




Property and Equipment




Property and equipment is recorded at historical cost.
Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. When property and equipment is sold or
otherwise disposed of, the cost and related accumulated depreciation or amortization is removed from the accounts and any resulting gain or loss is
included in income. The costs of normal maintenance and repairs are charged to expense when incurred.




In the event that facts and circumstances indicate that the
cost of an asset may be impaired, an evaluation of recoverability would be performed. There was no impairment recorded at September 30,
2010.




Film Costs




Film costs are capitalized in accordance with ASC 926. Film
costs represent capitalized costs for the production of films and other entertainment projects. These costs will be amortized when the films that the
Company is producing meet all the requirements listed in ASC 926 and the Company is recognizing revenues for the Films.




Film costs are amortized in the same proportion that the
current revenue bears to the estimated remaining unrecognized revenue as of the beginning of the current year. Revenue and cost forecasts are
periodically reviewed by management and revised when warranted.




The carrying value of the film costs are periodically
reviewed for impairment. If events or changes in circumstance indicate that the fair value of the capitalized costs on a specific film are less than
their carrying value, an impairment charge is recognized in the amount by which the unamortized costs exceed the projects fair value. No
impairment charge was recognized for the year ended September 30, 2010.




Development Costs




Development costs are capitalized costs related to projects
not in production. If the project is greenlit, the costs are reclassified as Film Costs. The Company evaluates on a monthly basis, all projects in
development. If the Company decides to abandon any project, an expense for the costs incurred to date will be included in the Companys
consolidated statements of operations. There were no development costs as of September 30, 2010.




Marketing Costs




The Company expenses distribution and marketing costs as
incurred. Distribution and Marketing costs for the year ended September 30, 2010 and 2009 totaled $136,457 and $84,828, respectively.




25


---



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 financial statement date and the reported amount of
revenues and expenses during the reporting year. Actual results may differ from those estimates.




NOTE 3. PROPERTY AND EQUIPMENT




Property and equipment are comprised of the
following:







|                                                |  |  |  | September, 30 |          
|----------------------------------------------- |  |  |  | ------------- | ---------
|
|Studio
equipment and computers                  |  |  |  | $             | 1,078,350
|Film video
equipment                            |  |  |  |               | 1,750,913
|Office
equipment                                |  |  |  |               | 43,121   
|Subtotal                                        |  |  |  |               | 2,872,384
|Less:
accumulated depreciation and amortization |  |  |  |               | (327,572 
|Property and
equipment, net                     |  |  |  | $             | 2,544,812



Depreciation and amortization expense related to property
and equipment was $145,880 and $87,965for the fiscal year ended September 30, 2010.




NOTE 4. FILM COSTS




The Company has completed a documentary on Michael Legrand.
The documentary was released in March of 2010.




Film costs at September 30, 2010 consist of the
following:







|Documentary
in release   |  |  |  | $ | 996,562 |  
|------------------------ |  |  |  | - | ------- | -
|Accumulated
amortization |  |  |  | $ | (31,258 | )
|Film costs,
net          |  |  |  | $ | 965,304 |  



Based on the Companys estimates of projected gross
revenues as of September 30, 2010, the Company expects approximately 80% of completed films, net of accumulated amortization, will be amortized during
the next three years.




NOTE 5. NOTES PAYABLE




The Company has entered into note agreements with various
individual lenders to fund a concert by Michel Legrand (the Concert). The notes earn 0% interest and are collateralized by a 2.5% of the outstanding
shares of Valencia for every $25,000 borrowed. In addition, for every $25,000 borrowed, the note holder receives 2.5% of the net profits of the Concert
(after all costs related to the Concert are recovered). As of September 30, 2010, the balance owed lenders was $912,990.




26


---



NOTE 6. CONVERTIBLE NOTES




On January 6, 2009, we entered into a convertible note
agreement. The terms of the note are as follows: principal amount $100,000; annual interest rate of 10%; maturity date of January 6, 2011. The note is
convertible into common shares at a rate of $0.10. In connection with the note, we issued 1,000,000 warrants with an exercise price of $0.20. These
warrants, which vested immediately, were valued using the Black Scholes Option Pricing Model.




NOTE 7. AUDIO AND FILM LIBRARY




The Company holds a library of video productions for
exploitation and broadcast which are carried at cost of $1,635,495.




According to an appraisal being conducted subsequent to
September 30, 2010, the VideoLibrary will have a certified value of no less than $6,900,000 for the copyrights and digital formatting. A
higher of value of 19,020,000 can be expected based on the potential income that can be generated over the next 7 years...In addition to valuing the
Video Library we have started compiling the information necessary for a valuation of the Audio Library which consists of Master Tapes, Demo Tapes,
Misc. Tapes as well as copyrights to most of the works along with copyrights on over 800 song titles. This appraisal will take a great deal of work to
sort through all the material available but we have already identified well over $2,500,000 in royalties that have not been paid over the last 19 years
on a few of the artists in the library. This does not include the copyrights on both published and non-published works.




This appraisal will in the opinion of the appraisers far
exceed the value of the Video Library by as much as 3 or 4 times in value.




NOTE 8. INCOME TAXES




No provision for Federal and state income taxes has been
recorded as the Company has incurred net operating losses through September 30, 2010. At September 30, 2010, the Company had approximately $21,991,285
of net operating loss carry-forwards for Federal income tax reporting purposes available to offset future taxable income. Such carry-forwards expire
beginning in 2011.




Deferred tax assets at September 30, 2010 consist primarily
of the tax effect of net operating loss carry-forwards, which amounted to approximately $7,115,059. Other deferred tax assets and liabilities are not
significant. We provided a full valuation allowance on the deferred tax
assets at September 30, 2010 to reduce such deferred income tax assets to zero, as we believe that realization of such amounts is not considered more
likely than not.




The following is a reconciliation of the provision for
income taxes at the U.S. federal income tax rate to the income taxes reflected in the Consolidated Statement of Operations:







|                                        |  |  |  | September 30, 2010 |     | September 30, 2009
|--------------------------------------- |  |  |  | ------------------ | --- | ------------------
|Tax Expense
(Benefit) at Statutory Rate |  |  |  |                    | (34 | )%                
|State Tax
Rate, Net of Federal          |  |  |  |                    | (6  | )                 
|Change In
Valuation Allowance           |  |  |  |                    | 40  |                   
|Effective Tax
Rate                      |  |  |  |                    | 0   | %                 



27


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The components of the net deferred tax asset are summarized
below:







|                          |  |  |  | September 30, 2010 |            | September 30, 2009
|------------------------- |  |  |  | ------------------ | ---------- | ------------------
|Deferred Tax
Asset:       |  |  |  |                    |            |                   
|Net Operating
Losses      |  |  |  | $                  | 7,115,059  |                   
|Less:
Valuation Allowance |  |  |  |                    | (7,115,059 | )                 
|Total                     |  |  |  | $                  |           |                   



NOTE 9. STOCK ACTIVITY


|a. |  | CONVERTIBLE PREFERRED STOCK
|-- |  | ---------------------------



At September 30, 2010, our authorized shares of convertible
Preferred Stock were as follows:




Series B Preferred Stock with no voting rights, is entitled
to receive cumulative dividends in preference to any dividend on the common stock at a rate of 10% per share, per year, to be issued if and when
declared by the Board of Directors and can be converted at any time into common
stock on a 1 for 5 basis. In the event of any liquidation, the holders of shares of Series B Preferred Stock then outstanding shall be entitled to
receive an amount equal to the purchase price per share, plus an amount equal to declared but unpaid dividends thereon, if any, to the date of payment.
As of September 30, 2010, 38,000 shares of preferred stock with a par value of $38 were issued and outstanding.




Series C Preferred Stock has no voting rights, is entitled
to receive cumulative dividends in preference to any dividend on the common stock at a rate of 10% per share, per year, to be issued if and when
declared by the Board of Directors and can be converted at any time into common
stock on a 1 for 1 basis. In the event of any liquidation, the holders of shares of Series C Preferred Stock then outstanding shall be entitled to
receive an amount equal to the purchase price per share, plus an amount equal to declared but unpaid dividends thereon, if any, to the date of payment.
In connection with the acquisition of Faith TV, we issued 100,000 shares of Series C Preferred Stock valued at $9,000. We also sold 5,000,000 shares of
Series C Preferred Stock for $250,000. As of September 30, 2010, 18,691,395 shares of preferred stock with a par value of $18,691 were issued and
outstanding.


|b. |  | COMMON STOCK
|-- |  | ------------



Stock for cash




During fiscal year 2007, we issued an aggregate 5,070,000
shares of common stock for $507,000.




During fiscal year 2008, we issued an aggregate 9,625,000
shares of common stock for $957,500.




Stock for services




During fiscal year 2009, we granted 3,532,059 shares of
common stock for various services. These shares vested immediately and had an aggregate fair value of $287,447, which was recorded as share-based
compensation. The fair value was determined based on the quoted stock price on the date of grant.




During fiscal year 2008, we granted 6,595,000 shares of
common stock for various services. These shares vested immediately and had an aggregate fair value of $937,600, which was recorded as share-based
compensation. The fair value was determined based on the quoted stock price on the date of grant.




During fiscal year 2010, 9,454,000 common shares for
services valued at $459,246.




Stock for debt




28


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On February 1, 2009, we issued 75,000 shares of common
stock in return for an extension on a note payable. We concluded that the debt was modified under FASB ASC 470-50. The fair value ($4,875) of the
shares issued was recorded as a discount on the debt.




During fiscal year 2008, we issued 500,000 shares of common
stock to settle $50,000 in debt. The common shares were valued at $80,000 based on the quoted stock price on the date of grant. The difference between
the fair value of the common shares and the book value of the loan was recorded as additional expense.




During fiscal year 2008, we issued 600,000 shares of common
stock in lieu of cash for payment of interest on two notes.




During the fiscal year ended September 30, 2010, ValCom
sold 1,520,000 common shares for $100,950, issued 100,000 to pay $6,000 of accounts payable resulting in a gain on the extinguishment of liabilities of
$2,200.The shares were valued using the closing price of ValComs common stock on the commitment date.




Stock for acquisition




On December 15, 2008, we purchased 100% of the outstanding
shares of FaithTV, LLC. In connection with the acquisition, we issued 1,500,000 shares of common stock, in aggregate, valued at $67,500 based on the
Companys quoted stock price. We also issued 100,000 shares of preferred stock valued at $9,000.




Stock for registration rights penalty




On April 17, 2009, we issued 1,191,000 shares of common
stock to settle certain registration rights penalty associated with warrants issued in prior years.




NOTE 10. SEGMENTS




The following is a discussion of our operating
segments:




- MyFamily TVis a TV network and broadcasting
division centered primarily on Christian ministry paid programming, older and public domain movies, and family programming such as Heres Lucy and
the Beverly Hillbillies.




- Film & TV Productionshas over 1000 movie titles
and 200 television episodes and 5000 songs which are typically licensed out for seven years.




- Real Estate Auctionsis primarily designed to sell
discounted foreclosed properties to a TV audience through a live auction.




NOTE 11. BANKRUPTCY FILING




On August 5, 2008, the United States Bankruptcy Court for
the Central District of California entered an Order Confirming Second Amended Plan of Reorganization under Chapter 11 of the Bankruptcy Code (the
Plan) of the Company. The Plan classifies claims and interest in various Classes according to their right to priority of payments as
provided in the United States Bankruptcy Code, 11 U.S.C.{section} 101 et seq. (the Bankruptcy Code). The Plan provides that upon
payment of all obligations pursuant to the Plan, the Company shall be discharged of liability for payment of debts, claims and liabilities incurred
before confirmation of the Plan, to the extent specified in {section}1141 of the Bankruptcy Code.




29


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The Plan provided for the treatment of each Class, and for
the cash payments that each Class of creditors will receive (and for the existing equity interests and rights that equity security holders will retain
under the Plan. The effective date of the Plan was August 15, 2008 (the
Effective Date). The Company has been funding the Plan through cash on hand and accumulated by the Effective Date to pay off the allowed
Priority Unsecured Tax claims.




On the Effective Date, unexpired leases and executory
contracts were assumed as obligations of the reorganized Company. The Order of the Court approving the Plan constitutes an order approving the
assumption of each lease and contract. Within 120 days of the entry of the order confirming the Plan, the Company filed a status report with the Court
explaining what progress has been made toward consummation of the confirmed Plan. The status report shall was served on the United States Trustee, the
twenty largest unsecured creditors, and those parties who have requested notice. Status reports are filed every 120 days and served on the same
entities until the Plan is fully consummated.




All persons or entities holding preferred or common stock
in the Company are referred to in the Plan as Interest Holders. The pre-existing pre-petition equity ownership interests and rights of all
Interest Holders will be left Intact and unimpaired. Of the total amount of common shares
issued, a majority of the common shares were issued to insiders of the Company. However, the Directors and President of the company elected to convert
their debt of $1,670,000 to Preferred Convertible Stock rather than issue approximately 33,400,000 shares of common stock as stated in the
Plan.




NOTE 12. LITIGATION, CONTINGENCIES AND
COMMITMENTS




Laurus Master Fund Settlement




On March 24, 2009, Valcom and Laurus Master Fund, Ltd, a
company organized under the laws of the Cayman Islands and Chicago Title Company, a California Corporation entered into a Settlement Agreement whereby
Valcom resolved its previously asserted claims against Laurus and Chicago Title. Pursuant to the terms of the Agreement, Laurus agreed to pay the
Company five hundred and fifty thousand dollars ($556,000) which was received by the Companys attorney on March 30, 2009. Within ten calendar
days after the Company receives payment from Laurus, the Company filed a Request for Dismissal of its claims, with prejudice, of its actions against
Laurus and Chicago Title and Chicago Title. This settlement is reflected as ‘Other Income in the consolidated statements of
operations.




30


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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM




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




On January 18, 2010, the board of directors of ValCom, Inc.
(the Company) dismissed Seale & Beers CPAs (S&B) as the Companys independent registered public accounting firm.




On January 18, 2010, the Company engaged Malone &
Bailey (M&B) as its independent registered public accounting firm for the Companys fiscal year ended September 30, 2009. The
change in the Companys independent registered public accounting firm was approved by the Companys Board of Directors on January 18,
2010.




ITEM 9A.  CONTROLS AND
PROCEDURES




EVALUATION OF DISCLOSURE CONTROLS AND
PROCEDURES




Pursuant to Rule 13a-15(b) under the Securities Exchange
Act (Exchange Act) of 1934, the Company carried out an evaluation with the participation of the Companys management, including Vince
Vellardita, the Companys Chief Executive Officer and Chief Financial Officer (CEO/CFO), of the effectiveness of the Companys
disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the year ended September 30, 2010. Based upon that
evaluation, the Companys CEO /CFO concluded that the Companys disclosure controls and procedures are not effective primarily due to an
overreliance on consultants to review critical accounting areas and disclosures; and a lack of sufficient qualified accounting staff.




MANAGEMENTS REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING




The management of ValCom, Inc. is responsible for
establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f)
or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, the companys principal
executive and principal financial officers and effected by the Companys board of directors, management and other personnel, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with
accounting principles generally accepted in the United States of America and includes those policies and procedures that:


|- |  | Pertain to the maintenance of records that in reasonable detail
accurately and fairly reflect the transactions and dispositions of the assets of the company;
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------

|- |  | Provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and
that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;
and
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|- |  | Provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of the companys assets that could have a material effect on the financial
statements.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements. 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.
All internal control systems, no matter how well designed, have inherent limitations.




Therefore, even those systems determined to be effective
can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal
control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting.
However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process
safeguards to reduce though not eliminate, this risk.




31


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Management assessed the effectiveness of the Companys
internal control over financial reporting as of September 30, 2010. In making this assessment, management used the criteria set forth by the Committee
of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework.




Based on its assessment, management concluded that, as of
September 30, 2010, the Companys internal control over financial reporting is not effective based on those criteria. In performing this
assessment, management identified the following material weaknesses:


|- |  | Lack of adequate segregation of controls
|- |  | ----------------------------------------

|- |  | Lack of adequate and qualified accounting staff to oversee the
accounting and financial statement close process
|- |  | ---------------------------------------------------------------------------------------------------------------

|- |  | Lack of adequate controls over debt and equity
transactions
|- |  | -----------------------------------------------------------

|- |  | Lack of controls over the expense cycle
|- |  | ---------------------------------------



This annual report does not include an attestation report
of the Companys registered accounting firm regarding internal control over financial reporting. The managements report was not subject to
attestation by the Companys registered public accounting firm pursuant to temporary rules of the Securities and Exchange
Commission.




CHANGES IN INTERNAL CONTROL OVER FINANCIAL
REPORTING




No changes in the Companys internal control over
financial reporting have come to managements attention during the Companys last fiscal year that have materially affected, or are likely to
materially affect, the Companys internal control over financial reporting.




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PART III




ITEM 10.  DIRECTORS, EXECUTIVE OFFICERS AND
CORPORATE GOVERNANCE




DIRECTORS AND EXECUTIVE OFFICERS




The following table sets forth the names and ages of the
Companys directors and executive officers, the positions with the Company held by each, and the period during which each such person has held
such position.







|NameSince             |  |  |  | Age |  | Position                               
|--------------------- |  |  |  | --- |  | ---------------------------------------
|Vince
Vellardita2000  |  |  |  | 52  |  | CEO/CFO/President/Chairman of the Board
|Frank
ODonnell2006   |  |  |  | 59  |  | Director                               
|Patrick
Willemsen2009 |  |  |  | 35  |  | Director                               



All directors hold office until the next annual meeting of
stockholders of the Company and until their successors are elected and qualified. Officers hold office until the first meeting of directors following
the annual meeting of stockholders and until their successors are elected and qualified, subject to earlier removal by the Board of
Directors.




BIOGRAPHIES OF THE COMPANYS EXECUTIVE OFFICERS AND
DIRECTORS




VINCE VELLARDITACHAIRMAN OF THE BOARD, CHIEF EXECUTIVE
OFFICER AND PRESIDENT




VINCE VELLARDITACHAIRMAN OF THE BOARD, CHIEF EXECUTIVE
OFFICER AND PRESIDENT




VINCE VELLARDITA, Chairman and Chief Executive
Officer for ValCom, Inc., has utilized his 30 years of experience in the entertainment industry and successfully turned ValCom, Inc., into an
Independent Entertainment Company having a 275 million dollar market cap. Mr. Vellardita strategically led the Company in acquiring property and
studios in Las Vegas, Los Angeles, and Palm Springs. These entertainment studios combined consisted of 20 soundstages with back lot at 350 thousand sq.
ft. on over 20 acres of land. He has been very instrumental in acquiring 143 films, 10 TV series, millions of dollars worth of equipment, and an
ownership of a TV station KVPS Palm Springs. ValCom has maintained long-term contracts with Paramount Pictures CBSs series JAG and
NCIS, and Walt Disneys Sabans Mighty Morphin Power Rangers.




Mr. Vellardita has consulted with Broadcasters and Studios
all over the world and continues long-standing relationships throughout the entertainment industry.




Mr. Vellardita began his career in 1977 as a fast-paced
music producer and promoter of over 200 live events and concerts with some of the biggest acts in the world. He also produced a Presidential campaign,
Super Bowl events and Broadway Theater and Las Vegas shows. In 1987, Mr. Vellardita bought his first TV station in Nashville and built it into a
television network with over 35 TV stations servicing over 9 million households, housing multiple sound stages and edit bays, as well as increasing
revenues by bring in national accounts to this network. With Mr. Vellarditas diversified background and successful track record in Nashville, he
relocated to Los Angeles and developed independent productions studios and focused on film and television from building the soundstages to all aspects
of deal making, as well as luring some of the biggest names in the television and motion picture community, including Paramount, Warner Brothers and
Disney. Mr. Vellarditas excellent reputation in the entertainment industry allowed him to maintain a 95% occupancy rate while being involved in
the production of several thousand episodes of television and hundreds of films.




At fifty two years of age, Mr. Vellardita has been married
to his wife Teresa for 20 years and has 2 sons, Jesse 26 and Anthony 23. Vince and Teresa reside in Florida and keep residence in both Los Angeles and
Las Vegas, Nevada.




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FRANK ODONNELL  DIRECTOR




The Company appointed Frank to the Board in 2007. Frank
ODonnell is also Vice-Chairman of TV compass and a founder of the Company. From 1996 to 2004, Mr. ODonnell was the founder and President of
Evolve Products, Inc. From 1986 to1995, he was the founder and Vice President of Universal Electronics, Inc. and from 1979 to 1986 he was the founder
and President of Cable Business Associates, Inc. Further, he previously managed the custom designs for Time Warner Cable and Comcast (AT&T/TCI)
universal remote controls.




PATRICK WILLEMSEN  DIRECTOR




On September 22, 2009, the Companys Board of
Directors appointed Patrick Willemsen as a director of the Company. Mr. Willemsen started his professional career with a Dutch foundation that was
responsible for the implementation of the first Internet-over-cable and TV-shopping mall solution for a Dutch CATV operator. In 1995 he started a
trading company in the Netherlands and imported food products from the Middle East to Europe, US and Asia. In 1997 Mr. Willemsen started a telecom
company and quickly led the company to a market cap of over 250 million USD. Early 2003 Mr. Willemsen moved to the USA and started the company Emergo
Consultancy. Emergo is active in consultancy and international business opportunities. The company assists small and medium sized companies in growth
and provides an emphasis on international expansion.




In 2007 Mr. Willemsen began ABEX Capital INC, which was
founded to manage investment funds used for structuring and acquiring distressed real estate and notes. Mr. Willemsen studied economics and management
in Amsterdam at the Hoge school van Amsterdam.




RICHARD SHINTAKU  DIRECTOR




In the third quarter, Richard Shintaku; a board member with
the company for several years resigned for health reasons. Since that date, Richard Shintaku  friend, partner and board member has passed away.
The Company wished his family well.




CARL AUSTIN POWERS  DIRECTOR




In March 2010, Carl Austin Powers was terminated from his
position of VP of Sales and Marketing for cause. Mr. Powers resigned as a board member two weeks after his termination.




FAMILY RELATIONSHIPS




There are no family relationships among our executive
officers and directors.




LEGAL PROCEEDINGS




There are no material proceedings to which any of our
directors, executive officers, affiliates or stockholders is a party adverse to us. 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 or any conviction in a criminal
proceeding or being subject to a pending criminal proceeding.




SECTION 16(A) BENEFICIAL OWNERSHIP
COMPLIANCE




Section 16(a) of the Securities Exchange Act of 1934
requires our directors and executive officers and persons who beneficially own more than ten percent of a registered class of our equity securities to
file with the SEC initial reports of ownership and reports of change in ownership of common stock and other equity securities of our company. Officers,
directors and greater than ten percent stockholders are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file.
Based solely upon a review of Forms 3 and4 and amendments thereto furnished to us under Rule 16a-3(e) during the fiscal year ended September 30, 2010,
and Forms 5 and amendments thereto furnished to us with




34


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respect to the fiscal year
ended September 30, 2010, we believe that during the year ended September 30, 2010, our executive officers, directors and all persons who own more than
ten percent of a registered class of our equity securities have complied with all Section 16(a) filing requirements.




THE BOARD OF DIRECTORS AND CORPORATE
GOVERNANCE




Our Board of Directors is responsible for establishing
broad corporate policies and for overseeing our overall management. In addition to considering various matters which require Board approval, the Board
provides advice and counsel to, and ultimately monitors the performance of, our senior management.




We do not have a standing Audit Committee, a Compensation
Committee, or a Nominations and Governance Committee of the board of directors. Our directors perform the functions of audit, nominating and
compensation committees. Our directors, Vincent Vellardita, Patrick Willemsen and Frank ODonnell, participate in the consideration of director
nominees. Due to the small size of our company and our board, the board of directors does not believe that establishing a separate nominating committee
is necessary for effective governance. When additional members of the Board of Directors are appointed or elected, we will consider creating a
nominating committee. The entire Board of Directors participates in audit related matters of our company, including, but not limited to, reviewing and
discussing our audited financial statements with management and our auditors and recommending to the board of directors that the financial statements
be included in our Annual Reports on Form 10-K. In performing their role equivalent to an audit committee, the Board of Directors (i)  reviewed and discussed the Companys
audited financial statements in the Companys Annual Report on Form 10-K for the fiscal year ended September 30,2009 with management, (ii)
discussed with the Companys independent registered public accounting firm the matters required to be discussed pursuant to Statement on Auditing
Standards No. 61 (Communication With Audit Committees),(iii) discussed with its independent registered public accounting firm matters relating to
independence, including the disclosures made to the Board as required by the Independence Standards Board Standard No. 1 (Independence Discussions with
Audit Committees), and (iv) in reliance on the aforementioned reviews and discussions, recommended to management the inclusion of the Companys
audited financial statements in the Companys Annual Report on Form 10-K for the fiscal year ended September 30, 2009 for filing with the
Securities and Exchange Commission. Messrs. Vellardita, Willemsen and ODonnell are not considered independent directors as defined by any
national securities exchange registered pursuant to Section 6(a) of the Securities Exchange Act of 1934 or by any national securities association
registered pursuant to Section 15A(a) of the Securities Exchange Act of 1934.




The Board and our management strive to perform and fulfill
their respective duties and obligations in a responsible and ethical manner. The Board performs annual self-evaluations. We have adopted a
comprehensive Code of Ethics for all directors, officers and employees.




During 2010, the Board of Directors met and/or executed
unanimous written consents of the Board of Directors  times. While we do not have a formal policy requiring members of the Board to attend the Annual
Meeting of Stockholders, we strongly encourage all directors to attend. No director attended fewer than 90% of the total number of
meetings.




DIRECTOR COMPENSATION




The Company has not paid and does not presently propose to
pay cash compensation to any director for acting in such capacity. However, the Company will give the directors a grant of shares of common stock and
reimbursement for reasonable out-of-pocket expenses for attending meetings. Outside directors received no cash compensation for their services; however
they were reimbursed for their expenses associated with attendance at meetings or otherwise incurred in connection with the discharge of their duties
as directors of the Company.




No officer of the Company receives any additional
compensation for his services as a director, and the Company does not contribute to any retirement, pension, or profit sharing plans covering its
directors.




ITEM 11.  EXECUTIVE
COMPENSATION




The following table sets forth the cash compensation
(including cash bonuses) paid or accrued by us for our years ended September 30, 2010, 2009 and 2008 to our Chief Executive Officer and our four most
highly compensated officers other than the Chief Executive Officer at September 30, 2010.




35


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SUMMARY COMPENSATION TABLE


|Name & Position |  |  |  | Year |      | Salary |  | Bonus |         | Other |  | LTIP |       | Restricted Stock | Options |  | All Other | 
|--------------- |  |  |  | ---- | ---- | ------ |  | ----- | ------- | ----- |  | ---- | ----- | ---------------- | ------- |  | --------- | 
|Vincent         |  |  |  |      | 2010 |        |  | $     | 125,000 |       |  |      |       |                  |         |  |           | 
|Vellardita      |  |  |  |      | 2009 |        |  | $     | 0       |       |  |      | 0.000 |                  |         |  | 0         | 
|CEO             |  |  |  |      | 2008 |        |  | $     | 0       |       |  |      | 0.000 |                  |         |  | 0         | 



2004 EMPLOYEE STOCK COMPENSATION PLAN




The Company has a 2004 Employee Stock Compensation Plan
(the ESCP) to enhance its ability to attract, retain and compensate experienced employees, officers, directors and consultants. The
effective date of the ESCP is January 10, 2004.




A total of 2,000,000 shares of common stock were registered
for issuance under the ESCP on Form S-8 registration statement filed December 30, 2003. Pursuant to the ESCP, the Compensation Committee or the Board
of Directors may award registered shares of the Companys common stock to employees, officers, directors or consultants for cash, property,
services rendered or other form of payment constituting lawful consideration. Plan shares awarded for other than services rendered shall be sold at not
less than fair market value on the date of grant. During the fiscal year ended September 30, 2004, the Company issued an aggregate of 1,000,000 shares
of registered common stock to employees, officers, directors and consultants pursuant to the ESCP for services rendered.




OPTIONS GRANTS IN LAST FISCAL YEAR




None




AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR
END OPTION VALUES




None.




EMPLOYMENT AGREEMENT




The Company entered into an Employment Agreement with Vince
Vellardita, the Companys Chairman of the Board, Chief Executive Officer and President, effective October 1, 2000. The term of the Agreement is
for five years. The Board of Directors may terminate, for just cause Mr. Vellarditas employment at any time. The Agreement shall be automatically
renewed for successive five year terms, unless either party gives written notice of termination three months prior to the end of the term. The
Agreement provides for an annual salary of $120,000 for the first year, $150,000 for the second year and $200,000 for the third year, plus a bonus if
authorized by the Board of Directors. If the Company is involved in a merger or consolidation in which it does not survive, or if the Company transfers
substantially all of its assets, the surviving entity in the merger or consolidation or the transferee of the Companys assets shall be bound by
the Agreement. With the exception of ownership of up to five percent of the equity securities of another publicly traded corporation, the Agreement
prohibits Mr. Vellardita from engaging in any activity competitive with or adverse to the Companys business or welfare without the Companys
prior written consent.




The Company entered into an Employment Agreement with Carl
Austin Powers, the Companys Executive Vice President of Sales and Marketing and Director effective 06th February 2009. The term of the agreement is three years and the agreement may be terminated in accordance with the terms of the
agreement and for just cause.




In March 2010 Mr. Powers was terminated for cause. Mr.
Powers took the company to arbitration. In the first quarter of 2011, the Arbitrator ruled that the Company was to pay 1/3 of Mr. Powers
contract. The Company is making arrangements to pay the Arbitrators award. Mr. Powers resigned as a board member two weeks after his
termination.




36


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




The following table sets forth information as to the shares
of our common stock beneficially owned as of September 30, 2010 by (i) each person known to us to be the beneficial owner of more than 5% of our common
stock; (ii) each director and nominee for director;(iii) each executive officer; and (iv) all of our directors and executive officers as a group.
Unless otherwise indicated in the footnotes following the table, the persons as to whom the information is given had sole voting and investment power
over the shares of common stock shown as beneficially owned by them. Unless otherwise indicated, the address of each person shown is c/o ValCom, Inc.,
2113A Gulf Boulevard, Indian Rocks Beach, Florida 33785.







|Title of Percent(2) Class of Class |  |  |  | Name and Address of Beneficial
Owner                         |  | Amount and Nature of Beneficial Owner (1)
|---------------------------------- |  |  |  | ------------------------------------------------------------ |  | -----------------------------------------
|Common                             |  |  |  | Vince
Vellardita                                             |  |                                          
|13.8%                              |  |  |  |                                                              |  |                                          
|Preferred                          |  |  |  | (CEO,
CFO, Chairman)                                         |  |                                          
|21.4%                              |  |  |  |                                                              |  |                                          
|Common                             |  |  |  | Richard Shintaku                                             |  |                                          
|8.3%                               |  |  |  |                                                              |  |                                          
|Preferred                          |  |  |  | (Director)                                                   |  |                                          
|8.2%                               |  |  |  |                                                              |  |                                          
|Common                             |  |  |  | Frank
ODonnell                                              |  |                                          
|1.2%                               |  |  |  |                                                              |  |                                          
|Preferred                          |  |  |  | (Director)                                                   |  |                                          
|5.4%                               |  |  |  |                                                              |  |                                          
|Preferred                          |  |  |  | Carl
Austin Powers (Director)*                               |  |                                          
|29.1%                              |  |  |  |                                                              |  |                                          
|(Executive
Vice President)         |  |  |  |                                                              |  |                                          
|Common                             |  |  |  | Patrick Wilemsen (Director)*                                 |  |                                          
|9.1%                               |  |  |  |                                                              |  |                                          
|Preferred                          |  |  |  |                                                              |  |                                          
|21.4%                              |  |  |  |                                                              |  |                                          
|Common                             |  |  |  |                                                              |  |                                          
|32.4%                              |  |  |  |                                                              |  |                                          
|                                   |  |  |  | All
Officers and Directors as a Group (Five (5) individuals) |  |                                          



* Represent 5,000,000 shares of Series C Preferred Class
stock owned by Rain Day Holdings, LLC. Rain Day Holdings LLC is owned by Tracey A. Powers, wife of Carl Austin Powers. Carl Austin Powers is the
authorized agent for Rain Day Holdings LLC and holds all the voting rights on said shares.




** Represents 4,000,000 shares of common stock held by Abex
Capital, Inc. and 1,000,000 shares of common stock held by Florida Opportunities, both entities for which Patrick Willemsen holds voting and
dispositive power and 4,000,000shares of Series C Preferred Stock held by Abex Capital Inc, for which Patrick Willemsen holds voting and dispositive
power.




(2)




* Less than one percent.




(1) The number and percentage of shares beneficially owned
is determined in accordance with Rule 13d-3 of the Securities Exchange Act of 1934, as amended, and the information is not necessarily indicative of
beneficial ownership for any other purpose. Under such rule, beneficial ownership includes any shares as to which the selling stockholder has sole or
shared voting power or investment power and also any shares, which the selling stockholder has the right to acquire within 60 days. Shares
Beneficially Owned After the Offering assumes the sale of all




37


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of the common shares offered by this prospectus and no
other purchases or sales of our common shares by the selling stockholders.




(2) Based upon
 share of common stock issued and outstanding as of September 30, 2010.




CHANGES IN CONTROL




To the best of the knowledge and belief of the Company,
there are no arrangements, understandings, or other agreements relative to the disposition of the Companys securities, the operation of which
would, at a subsequent date, result in a change in control of the Company.




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




NONE




ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND
SERVICES




The aggregate fees billed by Malone and Bailey, Certified
Public Accountants, Seale and Bears, Certified Public Accountants and Moore and Associates, Certified Public Accountants for professional services
rendered for the audit of the Companys annual financial statements for the years ended September 30, 2009 and 2008 and the review of the
financial statements included in the Companys Forms 10-Q, totaled as follows:







|                  |  |  |  | 2010 |  | 2009
|----------------- |  |  |  | ---- |  | ----
|Audit
fees        |  |  |  | $    |  |     
|Quarterly
reviews |  |  |  | $    |  |     
|Total             |  |  |  | $    |  |     



38


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PART IV




ITEM 15. EXHIBITS; FINANCIAL STATEMENT
SCHEDULES




Ex. 2.1 Second Amended Plan of Reorganization (Incorporated
by reference to the Companys current report on Form 8-K as filed with the Securities and Exchange Commission on August 15,
2008).




Ex. 3.1 Articles of Incorporation (Incorporated by
reference to the Companys Form 10SB filed with the Securities and Exchange Commission, File # 000-28416)




Ex. 3.2 Bylaws (Incorporated by reference to the
Companys Form 10SB filed with the Securities and Exchange Commission, File # 000-28416)




Ex. 3.3 Certificate of Amendment to Certificate of
Incorporation (Incorporated by reference to the Companys Schedule Def 14A filed with the Securities and Exchange Commission on October 20,
2006).




Ex. 10.2 Form of Guaranty dated November 25, 2008, by and
between ValCom, Inc. and Able Income Fund LLC (Incorporated by reference to the Companys current report on Form 8-K as filed with the Securities
and Exchange Commission on December 1, 2008)




Ex. 10.3 Form of Pledge Agreement dated November 25, 2008,
by and between ValCom, Inc. and Able Income Fund LLC (Incorporated by reference to the Companys current report on Form 8-K as filed with the
Securities and Exchange Commission on December 1, 2008)




Ex. 10.4 Form of Warrant dated November 25, 2008, by and
between ValCom, Inc. and Able Income Fund LLC (Incorporated by reference to the Companys current report on Form 8-K as filed with the Securities
and Exchange Commission on December 1, 2008)




Ex. 10.6 Form of Note Purchase Agreement dated January 6,
2009 by and between ValCom, Inc. and Omni Reliant holdings, Inc. (Incorporated by reference to the Companys current report on Form 8-K as filed
with the Securities and Exchange Commission on January 9, 2009)




Ex. 10.7 Form of 10% Secured Promissory Note dated January
6, 2009 by and between ValCom, Inc. and Omni Reliant Holdings, Inc. (Incorporated by reference to the Companys current report on Form 8-K as
filed with the Securities and Exchange Commission on January 9, 2009)




Exhibit 10.8 Form of Security Agreement dated January 6,
2009 by and between ValCom, Inc. and Omni Reliant Holdings, Inc. (Incorporated by reference to the Companys current report on Form 8-K as filed
with the Securities and Exchange Commission on January 9, 2009)




Ex. 10.9 Form of Warrant dated January 6, 2009
(Incorporated by reference to the Companys current report on Form 8-K as filed with the Securities and Exchange Commission on January 9,
2009)




Ex. 10.11 Form of Securities Purchase Agreement dated
September 22, 2009 (Incorporated by reference to the Companys current report on Form 8-K as filed with the Securities and Exchange Commission on
September 30, 2009)




Ex. 31.1 Certifications Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.




Ex. 32.1 Certifications Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.




Ex. 99.1 Order Confirming Second Amended Plan of
Reorganization under Chapter 11 of the Bankruptcy Code, entered on August 5, 2008 (Incorporated by reference to the Companys current report on
Form 8-K as filed with the Securities and Exchange Commission on August 15, 2008).




39


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SIGNATURES




In accordance with Section 13 or 15(d) of the Exchange Act,
the issuer caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.




Dated:




VALCOM, INC., A DELAWARE
CORPORATION


|By: |  | /s/ Vince VellarditaVince Vellardita Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal
Accounting and Financial Officer)
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------



In accordance with the Exchange Act, this report has been
signed below by the following persons on behalf of the issuer and in the capacities and on the dates indicated.







|SIGNATURE                                   |  |  |  | TITLE                                          |  | DATE
|------------------------------------------- |  |  |  | ---------------------------------------------- |  | ----
|By:  /s/ Vince VellarditaVince Vellardita   |  |  |  | Chief Executive Officer, Chairman of the Board |  |     
|                                            |  |  |  |                                                |  |     
|By:  /s/ Frank O DonnellFrank O Donnell     |  |  |  | Director                                       |  |     
|                                            |  |  |  |                                                |  |     
|By:  /s/ Patrick WillemsenPatrick Willemsen |  |  |  | Director                                       |  |     



40


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