**UNITED        STATES SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM        10-KSB**

 

*(Mark        One)*

þ        Annual report under Section 13 or 15(d) of the Securities Exchange Act of        1934 for the fiscal year ended**September 30,        2007**.

 

o        Transition        report under Section 13 or 15(d) of the Securities Exchange Act of 1934        (*No fee required*) for the transition        period from**___________**to**___________.**

 

Commission        File Number:**000-52017**

 

**HIGH END VENTURES, INC.** 

(Name of        Small Business Issuer As Specified In Its Charter)

 

|   | **Colorado** | **98-0219157**  |
|--------|--------------|----------------------|

|   | (State or Other Jurisdiction of Incorporation | (IRS Employer Identification No.) |
|--------|-----------------------------------------------|-----------------------------------|

                                                                                            or Organization)

 

**1066 West Hastings Street, Suite 2610, Vancouver, British Columbia V6E        3X2**

|   | (Address of principal executive offices) | (Postal Code) |
|--------|------------------------------------------|---------------|

 

**(604)** **602-1717** 

(Issuer’s Telephone Number, Including Area Code)

 

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

 

Title        of Each Class

Common        Stock ($0.001 par value)

 

Check        whether the issuer is not required to file reports pursuant to Section 13 or 15(d) of the        Exchange Act:o

 

Check        whether the registrant: (1) filed all reports required to be filed by Section 13 or 15(d)        of the Exchange Act during the past 12 months (or for such shorter period that the        registrant was required to file such reports), and (2) has been subject to such filing        requirements for the past 90 days:        Yes  þ  Noo

 

Check if        there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B        contained in this form, and if no disclosure will be contained, to the best of        registrant’s knowledge, in definitive proxy or information statements incorporated by        reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB:o

 

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

The        registrant’s total revenues for the year ended September 30, 2007, were        $0.

 

The        aggregate market value of the registrant’s common stock (the only class of voting        stock), held by non-affiliates (10,350,000 shares) was approximately $4,761,000based on the        average closing bid and ask price ($0.46) for the common stock on December 21,        2007.

 

As of        December 21, 2007, there were 15,850,000 shares outstanding of the registrant’s        common stock.

 

1

 

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**TABLE        OF CONTENTS**

 

**PART        I**

|   | Page |
|--------|------|

 

| Item 1. | Description of Business | 3 |
|---------|-------------------------|---|

         

| Item 2. | Description of Property | 16 |
|---------|-------------------------|----|

         

| Item 3. | Legal Proceedings | 16 |
|---------|-------------------|----|

         

| Item 4. | Submission of Matters to a Vote of                        Security-Holders | 16 |
|---------|----------------------------------------------------------------------------|----|

         

         

**PART II**

         

| Item 5. | Market for Common Equity and Related Stockholder                        Matters | 16 |
|---------|---------------------------------------------------------------------------------|----|

         

| Item 6. | Management’s Plan of Operation | 17 |
|---------|--------------------------------------|----|

         

| Item 7. | Financial Statements | 24 |
|---------|----------------------|----|

         

| Item 8. | Changes in and Disagreements with Accountants on Accounting                        and |
|---------|----------------------------------------------------------------------------------------|

|   | Financial Disclosure | 25 |
|--------|----------------------|----|

         

| Item 8A. | Controls and Procedures | 25 |
|----------|-------------------------|----|

         

| Item 8B | . | Other Information | 25 |
|---------|---|-------------------|----|

         

         

**PART III**

         

| Item 9. | Directors and Executive Officer | 25 |
|---------|---------------------------------|----|

         

| Item 10. | Executive Compensation | 28 |
|----------|------------------------|----|

         

| Item 11. | Security Ownership of Certain Beneficial Owners and                        Management | 28 |
|----------|---------------------------------------------------------------------------------------|----|

         

| Item 12. | Certain Relationships and Related Transactions | 29 |
|----------|------------------------------------------------|----|

         

| Item 13. | Exhibits | 29 |
|----------|----------|----|

         

| Item 14. | Principal Accountant Fees and Services | 29 |
|----------|----------------------------------------|----|

         

|   | Signatures | 31 |
|--------|------------|----|

         

|   | Exhibits | 32 |
|--------|----------|----|

 

 

 

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***As        used herein the terms “Company,” “we,” “us,” and        “our,” refer to High End Ventures, Inc. and our subsidiary. All references to        “Electrolinks” are to The Electrolinks Corporation.***

 

**PART        I**

 

| **ITEM 1.** | **DESCRIPTION OF BUSINESS** |
|-------------|-----------------------------|

 

**General**

 

High End        Ventures, Inc. was incorporated in Colorado on January 19, 1999.

 

On October        27, 2005, we commenced the business of exploring for precious metals. We conducted initial        exploration on our sole property, the Don Mineral Claim, located in the Victoria Mining        District, British Columbia, Canada, to determine whether the claim contained economically        recoverable reserves of gold, molybdenum, and/or copper. Since our early efforts did not        identify any economically recoverable mineral reserves we abandoned further exploration        efforts and entered into a Finder’s Fee Agreement with Valor Invest Ltd.        (“Valor”) dated September 15, 2006, for the purpose of assisting us in finding        a suitable business opportunity. Valor subsequently introduced us to The Electrolinks        Corporation.

 

Electrolinks was formed in Ontario, Canada on March 24, 2004 as a        development stage company focused on becoming a Full Service Broadband over Power Line        (“BPL”) based telecommunications integrator that intends to offer “Smart        Grid” BPL products from various vendors to electrical utilities and to buildings with        multiple dwelling units. BPL is a technology that delivers high-speed data over existing        electric power delivery networks and is an alternative means of providing high-speed        Internet access, voice over Internet Protocol (“VOIP”), and other broadband        services, using existing medium and low-voltage power lines to reach customers’ homes        and businesses.

 

On October        23, 2006, we executed a Securities Exchange Agreement and Plan of Exchange to acquire 100%        of the outstanding ownership of Electrolinks. However, due to certain legal considerations        relevant to the structure of the anticipated transaction the parties mutually agreed not to        proceed with the agreement. On September 18, 2007, the Company and Electrolinks executed a        Business Combination Agreement and an Amalgamation Agreement in order to transact the        acquisition of Electrolinks through the amalgamation of Power Grid Networks Ltd.        (“Power Grid”) (a wholly owned subsidiary of the Company) and        Electrolinks.

 

The        Amalgamation Agreement provides for the following actions:

 

|   | (a) | to amalgamate Power Grid and Electrolinks; |
|--------|-----|--------------------------------------------|

|   | (b) | to exchange two Electrolinks shares for one share of the                        Company; |
|--------|-----|------------------------------------------------------------------------------------------|

|   | (c) | to exchange shares of Power Grid with the Company on a one                        for one basis for each share issued by the Company to acquire Electrolinks                        shares; and |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) | to continue the business of Electrolinks through Power                        Grid. |
|--------|-----|-------------------------------------------------------------------------------------|

 

The        Business Combination Agreement anticipates the amalgamation of Electrolinks and Power Grid,        entitling each stockholder of Electrolinks to one share of the common stock of the Company        in exchange for two shares of the common stock of Electrolinks up to an aggregate of        21,584,183 shares of the Company for 43,168,366 shares of Electrolinks.

 

We are now        focused on concluding the acquisition of Electrolinks, subject to our stockholder’s        approval, in anticipation of realizing the opportunities attendant to providing broadband        over power line services.

 

 

3

 

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The        Company’s principal executive offices are located at 2610-1066 West Hastings Street,        Vancouver, British Columbia, Canada V6E 3X2. Our telephone number is (604) 602-1717 and our        facsimile number is (604) 687-6755. The Company’s registered statutory office is        located at 1210 South Glencoe, Denver, Colorado 80246. 

 

The        Company’s common stock is currently quoted on the Over the Counter Bulletin Board        under the symbol “HEVE”.

 

**Description of Intended Business**

 

***Summary***

 

The        Company, through Electrolinks, intends to become a full        service*broadband over power line*(“BPL”) based telecommunications integrator that will offer        “Smart Grid” BPL products. 

 

***The        Electrolinks Corporation***

 

Electrolinks was incorporated under the Business Corporations Act (of        Ontario) by articles of incorporation dated March 23, 2004 and continued pursuant to the        Canada Business Corporations Act by articles of continuance dated April 29, 2004.        Electrolinks’ registered office and principal place of business is located at 151        Bloor St. West, Toronto, Ontario M5S 1S4. Electrolinks’ telephone number is (416)        850-8881 and its facsimile number is (416) 850-8882.

 

***Broadband Over Power Lines***

 

Power lines        have sufficient capacity to transmit power as well as data. In fact, power lines have been        used to carry data for many years using a rudimentary technology that allowed delivery of        low-speed data over short distances. In recent years the technology has been refined to the        point that it now supports the efficient transmission of high-speed data over very long        distances.

 

BPL has        distinct advantages over broadband technologies such as DSL and cable in that it relies on        the existing electrical infrastructure so deployment costs are low. BPL also has greater        bandwidth delivery potential. The industry appears to have reached a “tipping        point” in that there is a clear momentum driving utilities, governments, and the        public to try BPL.

 

BPL uses        the existing power lines to distribute both voice and data transmission. Traditional        telecom systems (whether fiber or old style copper) can easily be integrated to power line        communications, effectively extending the telecom system for distribution over the grid.        BPL is the first technology,        combining:                           

 

| **•** | Broadband up and downstream capacity; |
|------------|---------------------------------------|

| **•** | Existing power grid infrastructure; |
|------------|-------------------------------------|

| **•** | Smart grids; |
|------------|--------------|

| **•** | Utility applications; and |
|------------|---------------------------|

| **•** | Integration into existing telecom carrier                        systems. |
|------------|---------------------------------------------------------------------------|

 

 

 

 

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Most        businesses, whether small or large, now require high speed Internet access. In response to        the demand for this service, the major telephone and other associated companies have built        large fiber optic networks that span North America and much of the world. Old buildings and        existing residential subdivisions do not have modern fiber optic or other wiring which are        able to give access to the high speed networks without the installation of new wiring, the        cost of which is prohibitive. The distance between the end user located in the areas not        now served by or able to access the high speed network is often called the “last        mile” - until now there has been no effective technology for economically making this        connection. The ability to access the high speed network over electrical wiring, or BPL,        would be a solution.

 

Public        utilities own and operate the power grid and can use electrical wiring for BPL with minimal        upgrade costs. Older buildings and facilities obtain the same benefits through the use of        the electrical wiring already present in providing internal high speed Internet and        telephone access.

 

Examples of        Electrolinks’ solutions are the following:

 

| **•** | Utilities with the last-mile solution allowing them to                        extend their fiber networks to residential and commercial customers over                        the electrical grid at low deployment costs. |
|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Utilities with a means to deploy automated-meter reading                        services, to address the need for real-time data in order for them to                        manage energy consumption. The Ontario government has proposed that                        utilities should be proactive in controlling electrical consumption during                        peak hours to avoid blackouts. |
|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Broadband access technology (high-speed Internet,                        telephone/voice, movies-on-demand, video conferencing). |
|------------|----------------------------------------------------------------------------------------------------------------------------------|

| **•** | Utilities and service providers with the control and                        management of data on the BPL network. |
|------------|--------------------------------------------------------------------------------------------------------------------|

| **•** | Consulting and training services to BPL clients. |
|------------|--------------------------------------------------|

| **•** | Traditional telecom companies (such as Bell and Rogers) with                        the ability to access customers that could not previously be reached due to                        high deployment and support costs. |
|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Utilities with alternate revenue sources by offering their                        clients additional services such as high-speed Internet, voice and data,                        and smart home services (data-enabled appliances and automated meter                        reading). |
|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Residential and commercial developers with a low cost                        alternative to enabling data communication for every electrical outlet                        within new and existing developments. BPL will provide the foundation for                        smart-home networking. |
|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

***BPL        Products and Services***

 

The        following is a brief summary of Electrolinks’ products:

 

| **•** | *BPL Access Masters*- These BPL                        network devices are similar to traditional network routers offered by                        CISCO, NORTEL and LUCENT. The BPL Access Master distributes the data signal                        over mid to low voltage lines (16KV to 100 volts). One BPL Access master                        can support up to 200 end users. |
|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | *BPL Access Modems*- These BPL                        network devices send/receive, interpret and encrypt data to and from the                        BPL network. A customer would use the modem between a BPL-enabled                        electrical outlet and a PC/laptop. |
|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | *BPL Software*- BPL is an                        application server that was designed to specifically work with BPL networks                        for network management, access and operations. In addition, BPL performs                        billing, invoicing, price plan development, and customer BPL                        management. |
|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

The BPL        application is commercially ready for sales demonstration and production deployment.        Electrolinks’ research and development and product marketing team are currently        working on BPL*MX*(Multimedia) that is        expected to handle all voice, video conferencing, and video-on-demand        applications.

 

5

 

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This        software application provides a host of features to allow service providers (i.e.        utilities) to collect, bill and manage real-time BPL data and users. Collection and        management of automated-meter reading data on the BPL network will enable utilities to        implement commercial and residential energy management programs, during peak hours to avoid        blackouts.

 

Electrolinks is also looking into “smart grid” or “smart        meter” applications. Smart meters are an advanced measurement and control technology        that accurately measures how much electricity is used and when. Smart metering technologies        provide “peak management”, advanced billing capabilities, outage notification,        and can link meters to other conservation and electricity demand management programs. These        benefits can also contribute to Government objectives to reduce emissions, keep energy        prices competitive, and to encourage electronic trading. Additionally, when a smart meter        is used, additional benefits in areas such as outage detection and restoration can be        realized, making the meter a key component of a utility's efforts to address blackouts and        storm- related outages.

 

Smart        meters allow electricity users to choose to lower their electricity bills by shifting their        usage to lower cost periods. Such activity by users is increasingly seen by policy makers        as a key part of a plan for addressing their nation's electricity needs. This technology is        beginning to be used in Europe, with Sweden requiring all electricity users to smart meter        by 2009.

 

Electrolinks also provides support, training and a subscriber portal.        Electrolinks follows a best of breed support procedure to assist its clients. Electrolinks        provides local technicians to resolve issues on the client site. To further expand the        local coverage, Electrolinks has defined an outsourcing program to train third party        technicians to handle issues on a per call basis.

 

***Raw        Material***

 

Electrolinks does not rely on any one or more raw materials or raw material        suppliers for the normal course of business. 

 

***Customers***

 

Electrolinks currently does not rely on one or few customers to continue        business nor does Electrolinks believe such a dependency will evolve in the future for        Electrolinks. Current and potential customers include:

 

| **•** | Electrical utility companies that require BPL for their own                        power network management. |
|------------|--------------------------------------------------------------------------------------------------------------|

| **•** | General use applications such as multi-occupant residences,                        businesses, office buildings, schools and universities, to provide basic                        service or as a revenue generator for the building owner. |
|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Hotels, providing a fast, economically-favourable rollout of                        Internet access offerings to guests as a revenue generator, at low capital                        cost. |
|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Any location world-wide with limited telecom infrastructure,                        through a satellite link. |
|------------|---------------------------------------------------------------------------------------------------------------|

 

**Competition** 

 

| Electrolinks faces competition primarily in three                        areas: |
|---------------------------------------------------------------------------------|

 

| **•** | Existing broadband/data/voice providers, such as Bell,                        Rogers and Primus. |
|------------|--------------------------------------------------------------------------------------------------|

| **•** | Emerging BPL providers. |
|------------|-------------------------|

| **•** | Wireless internet. |
|------------|--------------------|

 

6

 

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Electrolinks has developed a number of integrated solutions for the targeted        client markets, which will compete with existing communications solution providers. As        such, there are a number of existing competitors in each of Electrolinks’ target        markets.

There are        four major barriers to entering the growing demand for broadband:

 

| **•** | BPL is a new broadband alternative making a debut in North                        America where equipment costs are slightly higher than traditional DSL                        equipment. |
|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Misconceptions about BPL being an unreliable broadband                        alternative. This primarily has to do with the lack of current BPL                        knowledge and education. This is mainly because early BPL development in                        the 1980s was too costly and ineffective. Great strides have been made in                        advancing the technology as a commercially ready solution. |
|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Utility alignment with BPL as an alternative                        telecommunication channel must align with existing and future CRTC                        telecommunication rulings. |
|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Utilities have deep pockets to fund this technology;                        however, they are very conservative and risk-sensitive. |
|------------|-------------------------------------------------------------------------------------------------------------------------------------|

 

**Marketability**

 

The supply        of broadband Internet access has become a multi-billion dollar industry. Both home and        business have a need and requirement for fast and dependable internet access for uses and        applications which are increasing in number and type, such as “smart        appliances,” “smart meter reading,” video-on- demand and internet        telephony services. Power line systems can provide high speed access for rural        (mid-voltage) and “in-building” (low-voltage) broadband        distribution.

 

***Target Markets***

 

Through        market segmentation, several power line communication client markets naturally emerge based        on need:

 

| **•** | Governmental policy demands that citizens are connected to                        the internet; |
|------------|-------------------------------------------------------------------------------------------------|

| **•** | Electrical utilities need to manage their network                        efficiently as well as provide broadband services to residential and                        commercial customers; |
|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | High speed internet and rural users demand fast, low-cost                        internet service; and |
|------------|--------------------------------------------------------------------------------------------------------|

| **•** | Residential apartments, condominiums, businesses, hotels and                        convention centers’ need to provide more efficient and economic                        internet and VOIP services. |
|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

***Governmental Objectives***

 

Based on        the Statistics Canada 2002 Census Report almost 70% of the communities in Canada are        un-served. The objectives of the Canadian Federal Broadband Program 2002 are as        follows: 

| **•** | All Canadian communities should be linked to national                        broadband networks via high-capacity, scalable transport links capable of                        supporting an aggregate of 4.5 Mbps symmetrical service to each end user,                        as well as higher bandwidths to institutions. |
|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Access to broadband in First Nation, Inuit, rural and remote                        communities should be available at a reasonably comparable price to that                        charged in more densely populated areas. |
|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | The local broadband access infrastructure should be extended                        to the community’s public facilities, including every public learning                        institution, public health care facility, public library and other                        designated public access point. |
|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | The local broadband access infrastructure should also be                        extended to local business and residential users, for example, by                        leveraging broadband infrastructure serving public facilities. |
|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |  

                          |
|--------|----------------------------------------|

 

7

 

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The        Government of Canada’s goal through ensuring universal broadband access is to        stimulate economic growth in low or underdeveloped rural and urban communities. The cost        challenge has until now remained the biggest hurdle. The need in Canada (as mandated by the        federal government) is to reach 70% of Canadian communities. By providing this        communication enhancement at a reasonable cost, communities can greatly increase their        economic vitality through the development, sustenance and retention of valuable human        resources.

 

Canada is        not the only government which sees that a high speed data infrastructure is crucial for        achieving socio-economic development goals. For instance, South Korea and Hong Kong, upon        the introduction of broadband networks, found that telecommunication expenditure as a        percentage of gross domestic product grew up to three times faster in the last ten years        than the global average. Broadband can also facilitate the provision of public services,        such as e-learning, telemedicine and e-government.

 

***Utilities*** 

 

For        telephone companies and utility providers, broadband offers a route to provide a new source        of income if it could be provided by them to their customers. In South Korea, the average        revenue per broadband user is up to seven times higher than for a narrowband user. The        electrical power grids which utilities own, maintain and operate can now, with        BPL*,*be used to provide high speed        Internet access and telephone services. BPL is leading the way as an additional revenue        source.

 

The demand        on the part of utilities to manage their network in real time in order to deliver a more        reliable power supply cost effectively is becoming more and more critical. BPL offers the        utilities the most efficient and cost effective way to manage their networks. Electrolinks        is poised to take advantage of this tremendous business opportunity.

 

***High-Speed and Rural Consumers***

 

For        consumers, broadband makes possible a much wider and richer range of applications. Faster        access to richer information and the “always-on” nature of broadband are an        attraction for users. In a Japanese survey, 70% of users reported that broadband had        increased their usage of the internet. In Iceland, some 40 foreign television channels are        broadcast over the broadband network, greatly increasing the choice of services        available.

 

The        connected community concept will continue to have an increasingly dominant role in future        “greenfield” (outlying rural community) developments. Many developers have        already realized the value that an advanced broadband service offering can bring to their        development and it is these developers that will set the pace for others to compete        against.

 

With the        fast implementation and low BPL deployment costs, BPL is able to deliver community        broadband:

 

| **•** | *To strengthen local economies*– for example, by using multimedia web sites and                        on-line purchasing systems to sell products and services based on the                        community’s unique attributes and comparative advantages to regional,                        national and global markets. |
|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | *To improve local health care*– for example, by using video conferencing facilities                        that would allow local medical staff to diagnose illness and treat patients                        in real-time consultation with health care specialists. |
|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | *To make new learning opportunities available*– for example, through on-line video forums linking                        rural and remote schools. |
|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

 

8

 

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***Multi-Tenant Units/Condominiums***

 

The        multiple consumer market is the largest of the three target markets, both in terms of        service and equipment revenue. This market offers the greatest potential for marketing high        value services and, as a result, affords the greatest potential for deployment of high-end,        high-cost equipment.

 

A study        conducted by Bell Canada revealed that, in Canada alone, approximately 35% of the        population lives in buildings with more than four floors. BPL, as a “no new        wires” solution, is attractive from a resource, cost and time to market perspective.        The Yankee Group (2001) stated that over 860,000 residential buildings and apartment        complexes in the United States, accounting for approximately 60% of all businesses in the        U.S., are in multi-tenant unit facilities. Providing high-speed internet service is in the        billions of dollars in the U.S.

 

With the        pricing of traditional multi-tenant unit and multi-dwelling unit telecom equipment and        services being extremely high, there is a constant search for alternative networks that can        deliver at or above the current service offerings and at a lower price point. The BPL        solution can capitalize on its quick installation methodology and over time deliver        multiple services over the existing electrical wiring such as high-speed internet, local        and long-distance voice, video and security. Working through the electricity utilities will        allow Electrolinks to capitalize on this market.

 

***Hotels***

 

Globally, a        growing number of hotels are deploying “in-building” networks that reach 100%        of their guestrooms. New hotels are especially predominant in introducing this type of        deployment, but older hotels are also considering 100% deployment models.

 

The largest        contributor to the hotel market, throughout the forecasted period, will be the North        American market, specifically the United States. The strength of the U.S. market is based        on:

 

| **•** | The characteristics of the U.S. hotel market: there is a                        large base of hotels in the U.S., with a high percentage of these                        properties being appropriate for in-room broadband due to size, location,                        and clientele. |
|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Size of the business traveler audience: over 40% of                        worldwide business traveler trips occur within North America. As hotel                        broadband, at least over the next several years, will be driven by business                        travelers, the North American market will be the strongest                        region. |
|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

In North        America, as demand for connectivity increases, hotels are recognizing that many guests are        interested in broadband connectivity. Furthermore, as the market moves toward lower price        points, and eventually an amenity service offering, and where other services are using the        broadband network, it will be important for hotels to deliver a connection to every        guestroom, while at the same time keeping broadband deployment and management costs low.        BPL meets these business requirements by delivering quick enablement with zero room closure        (meaning that a hotel considering broadband for its guests can implement it quickly,        offering a valued service and earning new revenue within days).

 

**Governmental and Environmental Regulation**

 

The        Company, as a development stage company with no operations, is not subject to any specific        governmental or environmental regulations.

 

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Electrolinks is subject to regulation in the United States by the FCC. FCC        rules permit the operation of unlicensed digital devices that radiate radio frequency (RF)        emissions if the manufacturer complies with certain equipment authorization procedures,        technical requirements, marketing restrictions and product labeling requirements. Differing        technical requirements apply to “Class A” devices intended for use        in

commercial        settings and more stringent standards apply to “Class B” devices intended for        residential use. An independent, FCC-certified testing lab has verified that        Electrolinks’ BPL product line complies with the FCC technical requirements for Class        A and Class B digital devices. No further testing of these devices is required and same may        be manufactured and marketed for commercial and residential use.

 

In Europe        and other overseas markets, Electrolinks’ products are subject to safety and RF        emissions regulations adopted by the European Union (EU) for Information Technology        Equipment. In March 2005, Electrolinks received final Conformite Europeene (CE)        certification, which is required for Electrolinks to freely market and sell its products        within the EU. As a result of the certification, Electrolinks’ products that will be        sold and installed in EU countries will bear the CE marking, a symbol that demonstrates        that the product has met the EU’s regulatory standards and is approved for sale in        the EU.

 

Future        products designed by Electrolinks will require testing for compliance with FCC and CE        regulations. Moreover, if in the future, the FCC or EU changes its technical requirements,        further testing and/or modifications may be necessary.

 

**Patents, Trademarks, Licenses, Franchises, Concessions, Royalty        Agreements and Labor Contracts**

 

Neither the        Company nor Electrolinks currently has any patents, trademarks, licenses, franchises,        concessions, royalty agreements or labor contracts.

 

**Employees**

 

The Company        is a development stage company with no employees. Management uses consultants, attorneys,        and accountants as necessary.

 

Electrolinks is a development stage company and currently has nine contract        employees.

 

**Risk Factors**

 

Our future        operating results are highly uncertain. Before deciding to invest in us or to maintain or        increase your investment, you should carefully consider the risks described below, in        addition to the other information contained in our annual report. If any of these risks        actually occur, our business, financial condition or results of operations could be        seriously harmed. In that event, the market price for our common stock could decline and        you may lose all or part of your investment.

 

**RISKS        RELATED TO THE COMPANY’S BUSINESS**

 

***We        have a history of significant operating losses and such losses may continue in the        future.***

 

Since        inception, our expenses have substantially exceeded our income, resulting in continuing        losses and an accumulated deficit of $225,024 at September 30, 2007. During the year ended        September 30, 2007, we recorded a net loss of $175,500. The Company has never realized        revenue from operations. We will continue to incur operating losses as we pursue our        intention to acquire Electrolinks and satisfy our ongoing disclosure requirements with the        Securities and Exchange Commission (“Commission”). Our

 

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only        expectation of future profitability is dependent upon our ability to acquire Electrolinks        and develop Electrolinks’ business to a point that will produce revenue, which        objectives can in no way be assured.

 

***The        Company’s limited financial resources cast severe doubt on our ability to        successfully fund the business development of Electrolinks.***

 

One of the        conditions of the agreements to acquire Electrolinks is the representation that the Company        will use its best efforts to fund the business development of Electrolinks up to five        million dollars ($5,000,000) within twelve months of closing. Since our business plan is        currently dependent on the intended acquisition of Electrolinks, the prospect of satisfying        this funding commitment is immediate and doubtful. We currently have insufficient capital        to meet this condition and will have to rely on debt or equity offerings to meet this        funding obligation. Should we be unable to realize this funding within one year of closing        the transaction the successful development of the Electrolinks business plan may be called        into doubt due to financial constraints which may ultimately force the Company to curtail        or abandon operations.

 

***Terms        determined in the agreements to acquire Electrolinks would result in a change of control of        the Company.***

 

The        issuance of common shares to the stockholders of Electrolinks would dilute the voting power        and ownership percentage of our existing stockholders that would cause a change in control        of the Company. The terms of the agreements require us to issue 21,584,183 new shares that        would result in a dilution of approximately 57.7% to our existing stockholders. Further,        the agreements require the stockholders of the Company to elect two new members to the        board of directors, thus changing control of management. The change in control of the        Company could have a negative impact on our stockholders.

 

***The        Company might not realize the anticipated benefits from the acquisition of        Electrolinks.***

We may not        achieve the benefits we are seeking from the intended acquisition of Electrolinks.        Electrolinks may not be successful in its efforts focused on offering “Smart        Grid” applications of BPL products to power utilities and to buildings with multiple        dwelling units. As a result, our operations and financial results may be less rewarding        than anticipated, which may cause the market price of our common stock to        decline.

***The        intended acquisition of Electrolinks could decrease the value of your        stock.***

 

Electrolinks is a development stage company with a limited history of        realizing revenue and a record of net losses, about which Electrolinks’ auditors have        expressed a going concern opinion. Additionally, Electrolinks expects losses in the future        and its current assets are insufficient to conduct business operations over the next 12        months. Given these facts, the intended acquisition of Electrolinks could result in        significant losses for the Company which could decrease the value of your stock.

 

***We        might be unable to manage the growth of our business which could negatively affect        development, revenues, and fiscal        independence*****.**

 

We believe        that if our post-acquisition growth plan is successful, our business has the potential to        grow in size and complexity.  If our management is unable to manage growth        effectively, our business development may be slowed, our operating results may not show a        profit, and we may not become financially independent from outside funding sources.         Any new sustained growth would be expected to place a significant strain on our management        systems and operational resources.  We anticipate that new sustained growth, if any,        will require us to recruit, hire and retain new managerial, finance and support

 

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personnel.  We cannot be certain that we will be successful in        recruiting, hiring or retaining such personnel.  Our ability to compete effectively        and to manage our future growth, if any, will depend on our ability to maintain and improve        operational, financial, and management information systems on a timely basis and to expand,        train, motivate and manage our work force.  If we begin to grow, we cannot be certain        that our personnel, systems, procedures, and controls will be adequate to support our        operations. 

***We        may not be successful in integrating the business operations of Electrolinks into our own        operations, stifling growth and hindering the realization of a profit.***

The        acquisition of Electrolinks would involve the integration of companies that have previously        operated independently. A successful integration of Electrolinks’ operations        would depend on our ability to consolidate operations and to integrate Electrolinks’        management team. If we are unable to do so, we may not realize the anticipated        potential benefits of the acquisition, our business development could be stifled, and        results of operations might not produce a profit.  Difficulties could include the loss        of key employees, the disruption of Electrolinks’ ongoing businesses, and possible        inconsistencies in standards, controls, procedures and policies. 

**RISKS        RELATED TO THE BUSINESS OF ELECTROLINKS**

 

***Electrolinks’ limited operating history; anticipated losses;        uncertainly of future results.***

 

Since        Electrolinks has only recently commenced business operations there is limited information        on which to adequately evaluate its business and future prospects. Therefore,        Electrolinks’ future prospects should be considered with a view to the risks        encountered by a company in an early stage of development, particularly in light of the        uncertainties relating to customer acceptance of Electrolinks’ intended        services.

 

Electrolinks will continue to incur costs to develop and market BPL        solutions, to establish marketing relationships, and to build an administrative        organization. We can offer no certainty that Electrolinks will be profitable on a quarterly        or annual basis. In addition, as Electrolinks expands its business network and marketing        operations it will likely need to increase its operating expenses to broaden customer        support capabilities and increase administrative resources. To the extent that such        increased expenses are not supported by commensurate revenues, Electrolinks’        business, results of operations and financial condition would be adversely        affected.

 

***Electrolinks has a historical record of losses which may        continue.***

 

Electrolinks reported operating losses for the fiscal year ended December        31, 2006 of $1,248,239 and operating losses for the six months ended June 30, 2007 of        $898,159. The historical record indicates that Electrolinks has not realized sufficient        revenue from its efforts to provide us with any certainty that revenue is forthcoming or        that revenue will be sufficient to support operations. The sum of these indicators creates        uncertainty as to whether Electrolinks will ever transition from losses to profits. Should        Electrolinks continue to incur losses it would be unable to meet its working capital        requirements which inability would stifle operations.

 

***Need        for additional financing.***

 

Electrolinks has no significant revenue from operations and therefore is not        able to meet operating costs. As such, the Company would need to raise capital within the        next twelve months to implement Electrolinks’ plan of operation. However, there can        be no assurance that the Company would be able to raise the required capital or that any        capital raised would be obtained on favourable terms. Failure to obtain adequate capital        would significantly curtail Electrolinks’ business.

 

 

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***Unpredictability of future revenues.***

 

Due to        Electrolinks’ lack of operating history and the emerging nature of the market in        which it competes, it is unable to forecast its revenues or expenses with any degree of        certainty. Electrolinks’ projected expenses and revenue are based largely on internal        estimates. Operating results will depend on the volume of orders for services or products        offered, the ability to obtain and retain customers, and revenues generated offset by the        expenses incurred in obtaining those results. Projections, by their very nature, difficult        to forecast and should not be relied on to provide a reliable indicator of future operating        results.

 

***Dependence on key personnel.***

 

Electrolinks’ performance and operating results are substantially        dependent on the continued service and performance of its managers, officers, and        directors. Electrolinks intends to hire additional managerial personnel as they move        forward with their business model. Competition for such personnel is intense, and there can        be no assurance that Electrolinks can retain its key management employees, or that it will        be able to attract or retain highly qualified technical personnel in the future. The loss        of the services of Hari Rao, Wayne Owens, or any of Electrolinks’ other key employees        or the inability to attract and retain the necessary management personnel could have a        material adverse effect upon its business.

 

***Electrolinks growth is dependent upon the availability and successful        hire of independent contractors.***

 

Electrolinks’ continued growth and success depend to a significant        extent on the successful hire of qualified independent contractors. Competition for        highly-skilled business, product development, technical and other personnel is intense due        to skill shortages and the variety of companies that offer equity incentives. Accordingly,        Electrolinks expects to experience increased compensation costs to engage independent        contractors which costs may not be offset by improved productivity or increased revenues.        Further, there can be no assurances that Electrolinks will be successful in continuously        recruiting the necessary independent contractors. Failure to obtain the right personnel to        develop Electrolinks’ business model could have a material adverse effect on        Electrolinks’ growth.

 

***Unproven acceptance of Electrolinks’ services and        products.***

 

Electrolinks is still in the development stage and cannot provide any        certainty as to whether its services and products will be accepted by prospective        customers. Should Electrolinks’ services and products prove to be unsuccessful with        prospective customers, such failure would adversely affect its financial condition,        operating results, and cash flows.

 

***Electrolinks competes with larger and better financed        corporations.***

 

Competition        within the international BPL products market is intense. While Electrolinks believes that        its products will be distinguished by next-generation innovations that are more        sophisticated, flexible and cost effective than many competitive products currently in the        market place, a number of entities offer BPL products, and new competitors may enter the        market in the future. Some of BPL’s existing and potential competitors have longer        operating histories, greater name recognition, larger customer bases and significantly        greater financial, technical and marketing resources than Electrolinks does, including well        known multi-national corporations like Bell, Rogers and Primus.

 

 

 

 

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***Electrolinks has no proprietary or intellectual property        rights.***

 

Despite        being a technology based business, Electrolinks has no proprietary or intellectual property        rights associated with the provision of BPL services. Rather, Electrolinks is dependent on        technology that it intends to license from third parties. The absence of proprietary and        intellectual property rights makes Electrolinks vulnerable to unauthorized third parties,        including competitors, who may copy its business plan effectively offering the same type of        services that Electrolinks intends to offer. A multitude of competitors using the same        technology to offer the same products as Electrolinks could have an adverse effect on        future growth.

 

***Dependence on licensed technology and third party service        providers.***

 

Electrolinks relies on a limited number of manufacturers as well as service        providers to offer BPL services, which reliance reduces the level of control we have over        our operations and exposes it to significant risks such as inadequate capacity, late        delivery, substandard quality and higher prices, all of which could adversely affect        business. If Electrolinks’ suppliers or services providers are unable to provide        products or services in the volumes needed or at an acceptable price, Electrolinks would        have to identify and qualify acceptable replacements from alternative sources of supply. If        Electrolinks was unable to obtain products or services in a timely fashion, it would likely        not be able to meet customer demand. Any disruption of either product procurement or        services could adversely affect Electrolinks’ operations.

 

**RISKS        RELATED TO THE COMPANY’S STOCK**

 

***The        Company’s stockholders may face significant restrictions on their        stock.***

 

The        Company’s stock differs from many stocks in that it is a “penny stock.”        The Commission has adopted a number of rules to regulate “penny stocks”        including, but not limited to, those rules from the Securities Act as follows:

 

|   | 3a51-1 | which defines penny stock as, generally speaking, those                        securities which are not listed on either NASDAQ or a national securities                        exchange and are priced under $5, excluding securities of issuers that have                        net tangible assets greater than $2 million if they have been in operation                        at least three years, greater than $5 million if in operation less than                        three years, or average revenue of at least $6 million for the last three                        years; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 15g-1 | which outlines transactions by broker/dealers which are                        exempt from 15g-2 through 15g-6 as those whose commissions from traders are                        lower than 5% total commissions; |
|--------|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 15g-2 | which details that brokers must disclose risks of penny                        stock on Schedule 15G; |
|--------|-------|-------------------------------------------------------------------------------------------------------|

|   | 15g-3 | which details that broker/dealers must disclose quotes and                        other info relating to the penny stock market; |
|--------|-------|----------------------------------------------------------------------------------------------------------------------------------|

|   | 15g-4 | which explains that compensation of broker/dealers must be                        disclosed; |
|--------|-------|----------------------------------------------------------------------------------------------|

|   | 15g-5 | which explains that compensation of persons associated in                        connection with penny stock sales must be disclosed; |
|--------|-------|---------------------------------------------------------------------------------------------------------------------------------------|

|   | 15g-6 | which outlines that broker/dealers must send out monthly                        account statements; and |
|--------|-------|---------------------------------------------------------------------------------------------------------|

|   | 15g-9 | which defines sales practice requirements. |
|--------|-------|--------------------------------------------|

Since our        securities constitute a “penny stock” within the meaning of the rules, the        rules would apply to us and our securities. Because these rules provide regulatory burdens        upon broker-dealers, they may affect the ability of stockholders to sell their securities        in any market that may develop; the rules themselves may limit the market for penny stocks.        Additionally, the market among dealers may not be active. Investors in penny stock often        are unable to sell stock back to the dealer that sold them the stock. The mark-ups or        commissions charged by the broker-dealers may be greater than any profit a seller may make.        Because of large dealer spreads, investors may be unable to sell the stock immediately back        to the

 

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dealer at        the same price the dealer sold the stock to the investor. In some cases, the stock may fall        quickly in value. Investors may be unable to reap any profit from any sale of the stock, if        they can sell it at all.

Stockholders should be aware that, according to Commission Release No.        34-29093 dated April 17, 1991, the market for penny stocks has suffered from patterns        of fraud and abuse. These patterns include:

 

|   | **•** | control of the market for the security by one or a few                        broker-dealers that are often related to the promoter or issuer; |
|--------|------------|------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | manipulation of prices through prearranged matching of                        purchases and sales and false and misleading press releases; |
|--------|------------|--------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | “boiler room” practices involving high pressure                        sales tactics and unrealistic price projections by inexperienced sales                        persons; |
|--------|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | excessive and undisclosed bid-ask differentials and markups                        by selling broker-dealers; and |
|--------|------------|-------------------------------------------------------------------------------------------------------------------|

|   | **•** | the wholesale dumping of the same securities by promoters                        and broker-dealers after prices have been manipulated to a desired level,                        along with the inevitable collapse of those prices with consequent investor                        losses. |
|--------|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

***The        market for our stock is limited and our stock price may be volatile.***

 

The market        for our common stock has been limited due to low trading volume and the small number of        brokerage firms acting as market makers. Because of the limitations of our market and        volatility of the market price of our stock, investors may face difficulties in selling        shares at attractive prices when they want to. The average daily trading volume for our        stock has varied significantly from week to week and from month to month, and the trading        volume often varies widely from day to day.

 

***We        may incur significant expenses as a result of being quoted on the Over the Counter Bulletin        Board, which may negatively impact our financial performance.***

 

We may        incur significant legal, accounting and other expenses as a result of being listed on the        Over the Counter Bulletin Board. The Sarbanes-Oxley Act of 2002, as well as related rules        implemented by the Commission has required changes in corporate governance practices of        public companies. We expect that compliance with these laws, rules and regulations,        including compliance with Section 404 of the Sarbanes-Oxley Act of 2002 as discussed in the        following risk factor, may substantially increase our expenses, including our legal and        accounting costs, and make some activities more time-consuming and costly. As a result,        there may be a substantial increase in legal, accounting and certain other expenses in the        future, which would negatively impact our financial performance and could have a material        adverse effect on our results of operations and financial condition.

 

***Our        internal controls over financial reporting may not be considered effective, which could        result in a loss of investor confidence in our financial reports and in turn have an        adverse effect on our stock price.***

 

Pursuant to        Section 404 of the Sarbanes-Oxley Act of 2002, beginning with our annual report for the        year ending September 30, 2008, we may be required to furnish a report by our management on        our internal controls over financial reporting. Such report will contain, among other        matters, an assessment of the effectiveness of our internal controls over financial        reporting as of the end of the year, including a statement as to whether or not our        internal controls over financial reporting are effective. This assessment must include        disclosure of any material weaknesses in our internal controls over financial reporting        identified by management. If we are unable to assert that our internal controls are        effective as of September 30, 2008, investors could lose confidence in the accuracy and        completeness of our financial reports, which in turn could cause our stock price to        decline.

 

 

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**Reports to Security Holders**

 

The Company        is not required to deliver an annual report to security holders and will not voluntarily        deliver a copy of the annual report to the security holders. Should we choose to create an        annual report, it will contain audited financial statements. We file all of our required        information with the Commission

 

The public        may read and copy any materials that we file with the Commission at the Commission’s        Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. The public may obtain        information on the operation of the Public Reference Room by calling 1-800-SEC-0330. The        statements and forms we file with the Commission have been filed electronically and are        available for viewing or copy on the Commission maintained Internet site that contains        reports, proxy, and information statements, and other information regarding issuers that        file electronically with the Commission. The Internet address for this site can be found        at:*www.sec.gov.*

 

| **ITEM 2.** | **DESCRIPTION OF PROPERTY** |
|-------------|-----------------------------|

 

The Company        currently maintains limited office space for which we pay no rent. We do not believe that        we will need to obtain additional office space at any time in the near future.

 

| **ITEM 3.** | **LEGAL PROCEEDINGS** |
|-------------|-----------------------|

 

The        Company is currently not a party to any legal proceedings.

 

| **ITEM 4.** | **SUBMISSION OF MATTERS TO A VOTE OF SECURITY                        HOLDERS** |
|-------------|--------------------------------------------------------------------------------|

 

During the        fourth quarter ended September 30, 2007, there were no matters submitted to a vote of the        Company’s security holders.

**PART        II**

 

| **ITEM 5.** | **MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER                        MATTERS** |
|-------------|-------------------------------------------------------------------------------------|

 

The        Company’s common stock is quoted on the Over the Counter Bulletin Board, a service        maintained by the National Association of Securities Dealer, Inc. under the symbol,        “HEVE”. Trading in the common stock over-the-counter market has been limited        and sporadic and the quotations set forth below are not necessarily indicative of actual        market conditions. These prices reflect inter-dealer prices without retail mark-up,        mark-down, or commission, and may not necessarily reflect actual transactions. Our stock        began trading on September 28, 2006, the following table is limited to quarterly high and        low bid prices since that date:

 

| **YEAR** | **QUARTER ENDED** | **HIGH** | **LOW** |
|----------|-------------------|----------|---------|
| 2007     | September 30,     | $1.29    | $0.70   |
| 2007     | June 30           | $2.15    | $1.20   |
| 2007     | March 31          | $2.25    | $1.97   |
| 2006     | December 31       | $2.40    | $1.05   |
| 2006     | September 30      | $1.05    | $1.01   |

 

 

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As of        December 21, 2007, there were 6 registered holders of the Company’s stock based on        the records of our transfer agent. This number does not include beneficial owners of our        common stock whose stock is held in the names of various securities brokers, dealers and        registered clearing agencies.

 

The Company        has never paid dividends on its common stock and does not intend to pay dividends on its        common stock in the foreseeable future. Our board of directors intends to retain any        earnings to provide funds for the operation and expansion of our intended        business.

 

| **ITEM 6.** | **MANAGEMENT’S PLAN OF OPERATIONS** |
|-------------|-------------------------------------------|

 

This*Management’s Plan of Operation*and*Results of Operations*and other parts of this        report contain forward-looking statements that involve risks and uncertainties.        Forward-looking statements can also be identified by words such as        “anticipates,” “expects,” “believes,”        “plans,” “predicts,” and similar terms. Forward-looking statements        are not guarantees of future performance and our actual results may differ significantly        from the results discussed in the forward-looking statements. Factors that might cause such        differences include, but are not limited to those discussed in the subsections        entitled*Forward-Looking Statements and Factors That May Affect        Future Results and Financial Condition*. The following discussion        should be read in conjunction with our financial statements and notes thereto included in        this information statement. All information presented herein is based on our fiscal year        ended September 30, 2007.

 

**General**

 

Our plan of        operation over the next year, subject to closing the acquisition of Electrolinks, is to        focus on Electrolinks’ business model. Electrolinks’ provides “smart        grid” applications for power utilities and buildings in addition to delivering        broadband over power line (BPL) services over any form of existing electrical        infrastructure.

 

Our plan of        operation for Electrolinks will require that we raise up to $5 million through private        placements of stock to fund the expansion of the Electrolinks BPL products, services and        network. There can be no assurance that this funding will be available to us. Should the        parties not obtain shareholder approval of the intended transaction, our plan of operation        for the coming year will be to identify and acquire an alternative business opportunity. We        will not limit our options to any particular industry, but will evaluate each opportunity        on its own merits.

 

***Electrolinks’ Business Strategy***

 

Electrolinks is still in the business development stage and is yet to earn        substantial revenues from operations. Electrolinks may experience fluctuations in operating        results in future periods due to a variety of factors including, but not limited        to:  

 

| **•** | market acceptance of the Internet and power line                        communication technologies as a medium for customers to purchase                        Electrolinks’ products, |
|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Electrolinks’ ability to acquire and deliver high                        quality products at a price lower than currently available to                        consumers, |
|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Electrolinks’ ability to obtain additional financing                        in a timely manner on terms favorable to Electrolinks, |
|------------|------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Electrolinks’ ability to successfully attract                        customers at a steady rate and maintain customer satisfaction, |
|------------|-------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Electrolinks promotions, branding and sales                        programs, |
|------------|------------------------------------------------------------------------------|

| **•** | the amount and timing of operating costs and capital                        expenditures relating to the expansion of Electrolinks’ business,                        operations and infrastructure, and the implementation of marketing                        programs, |
|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | key agreements and strategic alliances, |
|------------|-----------------------------------------|

 

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| **•** | the number of products offered by Electrolinks, |
|------------|-------------------------------------------------|

| **•** | the number of returns experienced by Electrolinks,                        and |
|------------|-------------------------------------------------------------------------------|

| **•** | general economic conditions specific to the Internet,                        power-line communications, and the communications industry. |
|------------|------------------------------------------------------------------------------------------------------------------------------------------|

Given the        unique nature of the BPL technology and its limited market penetration to date in North        America, there is a need to establish a strong commercial presence and associated branding.        As such, Electrolinks has established a multi-tiered market entry and growth plan        incorporating the following key        actions:                                 

 

***1.        Establish an Initial BPL Foothold***

 

It is        critical to gain a commercial presence for BPL in North America and, in particular, a        presence associated with Electrolinks. Currently, Electrolinks is leveraging several        existing relationships in the hospitality market to deploy a commercial BPL installation        (at minimum) in the next three months. In addition, Electrolinks is working with hydro        utilities and native reservations to implement BPL as a demonstration        technology.    

 

***2.******Establish Electrolinks’        BPL Center of Excellence***

 

A key        element of Electrolinks’ strategy is to establish a North American BPL Center of        Excellence. The Center of Excellence will focus on the following functions:

 

| **•** | Testing and qualifying facility for the North American use                        of BPL technology, |
|------------|------------------------------------------------------------------------------------------------------|

| **•** | Demonstration lab for the presentation of BPL to customers,                        government and the media, and |
|------------|------------------------------------------------------------------------------------------------------------------|

| **•** | Training center for BPL for North America. |
|------------|--------------------------------------------|

In        addition, Electrolinks is working with the U.S. based BPL Association in an effort to help        establish a

BPL        Association of Canada with Electrolinks as one of the founding members. These actions are        intended to establish Electrolinks as a key player and thought leader in the evolving North        American BPL        market.                                                                                                                                                                                                            

***3.******Build out Utilities        Partnership***

 

A        relationship model with Canadian utilities is essential for success in rural regions.        Electrolinks is currently working with a number of key members of several hydro utilities        to define a business model that will enable broadband to BPL rural customers while also        providing a new revenue stream to the hydro utilities themselves. Electrolinks expects to        have several models in place within the next few months.

 

Canadian        governments, at both the federal level and the provincial level, have set aside funding to        ensure that all Canadians have access to high speed internet services. Electrolinks is        currently working with both levels of government on how to best bring BPL technology to        those regions that are currently not served. Electrolinks is also reviewing the first set        of rural region requests for proposal developed by community co-ops in preparation for the        planned offering for these rural co-ops.

 

***4.******Develop the Electrolinks Sales        Channel and Business Partner model***

 

Electrolinks’ initial market entry is through key utilities, but over        time the goal is to establish partner channels to enable the significant sales volume that        is expected as BPL technology gains North American momentum.

 

Electrolinks is establishing three major categories for partners:

 

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| **•** | Utility business partners – A joint marketing and                        revenue sharing partner structure specifically with hydro utilities for the                        rural Canada market. |
|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Technology extender partners – A program to establish                        partnerships with other technology providers that extend the value                        proposition of BPL. These include existing partnerships, as well as future                        needs in potential areas such as wireless and long range fiber. |
|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **•** | Sales channel partners – Electrolinks will establish a                        partner sales channel to leverage the potential of the large number of                        companies that are currently marketing solutions to the hospitality and                        multi-commercial unit markets. Electrolinks will provide a partner friendly                        integrated solution product that sales partners will be able to market and                        deploy to customers. |
|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Electrolinks anticipates executing on this market entry strategic plan over        a period of approximately nine to twelve months.

 

**Results of Operations** 

 

During the        year ended September 30, 2007, our operations were limited to moving away from the        exploration of mineral properties, finalizing those agreements pertaining to the intended        acquisition of Electrolinks, and satisfying continuous public disclosure requirements.        Since Electrolinks is in the development stage with no history of generating revenue, we        cannot determine whether the Company will ever generate revenues from        operations.

 

***Revenues***

 

The Company        has not generated any revenues to date. We do not expect to receive revenues within the        next twelve months sufficient to fund our operations, even in the event that the        acquisition of Electrolinks is approved and completed. Electrolinks has only recently        initiated the commercial application of its technology and has realized limited revenue to        date.

 

***Net        Loss***

 

For the        period from inception January 19, 1999 to September 30, 2007, the Company recorded an        operating loss of $225,024. Net losses for the three month period ended September 30, 2007        were $113,714 as compared to $10,018 for the three months ended September 30, 2006. Net        losses for the year ended September 30, 2007 were $175,500 as compared to $44,024 for the        year ended September 30, 2006. The Company’s operating losses in the current year are        attributable to general and administrative expenses with a majority relating to expenses        generated while finalizing the business agreement with Electrolinks. Expenses in prior        periods have also included exploration costs directly related to our former precious metals        exploration program. The Company has not generated any revenues since inception.

 

The Company        expects to continue to operate at a loss through fiscal 2008 and due to the nature of our        intended acquisition of Electrolinks or alternatively our search for another business        opportunity cannot determine whether we will ever generate revenues from        operations.

 

***Income Tax Expense (Benefit)***

         

The Company        has a prospective income tax benefit resulting from a net operating loss carryforward and        start up costs that will offset any future operating profit.

 

***Impact of Inflation***

         

The Company        believes that inflation has had a negligible effect on operations over the past three        years.

 

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***Capital Expenditures***

 

The Company        expended no significant amounts on capital expenditures for the period from inception to        September 30, 2007.

 

***Capital Resources and Liquidity***

 

The Company        had current assets of $277,915 and total assets of $277,915 as of the year ended September        30, 2007, consisting of cash on hand of $11,412 and expected proceeds from a loan        receivable of $266,503. Net stockholders’ deficiency in the Company was $161,524 at        September 30, 2007. The Company is in the development stage and, since inception, has        experienced significant changes in liquidity, capital resources and stockholders’        equity.

 

Cash flow        used in operating activities was $94,604 for the period from inception to September 30,        2007. Cash flow used in operating activities for the year ended September 30, 2007 was        $42,485 as compared to $32,024 in cash flow used in operating activities for the year ended        September 30, 2006. Cash flow used in operating activities in the current year can be        attributed to expenses associated with finalizing the business agreement with        Electrolinks.

 

Cash flow        provided from financing activities was $346,107 for the period from inception to September        30, 2007. Cash flow provided by financing activities for the year ended September 30, 2007        was $295,107 as compared to $40,000 for the year ended September 30, 2006. Cash flow        provided by financing activities in the current year consists entirely of shareholder        loans.

 

Cash flows        used in investing activities was $260,186 for the period from inception to September 30,        2007. Cash flows used in investing activities for the year ended September 30, 2007 was        $255,186 as compared to $0 for the year ended September 30, 2006. Cash flow used in        investing activities during 2007 consists of loans made to Electrolinks.

 

The        Company’s current assets may not be sufficient to conduct its plan of operation over        the next twelve (12) months and it will have to realize debt or equity financing to fund        operations. The Company has no current commitments or arrangements with respect to, or        immediate sources of funding. Further, no assurances can be given that funding, if needed,        would be available to the Company on acceptable terms, if at all. Therefore, the        Company’s stockholders would be the most likely source of new funding in the form of        loans or equity placements though none have made any commitment for future investment and        we have no agreement formal or otherwise. The Company’s inability to obtain funding        would have a material adverse affect on its plan of operation.

 

The Company        had no formal long term lines or credit or other bank financing arrangements as of        September 30, 2007.

 

Since        earnings, if any, will be reinvested in operations, the Company does not expect to pay cash        dividends in the foreseeable future.

 

The Company        has no defined benefit plan or contractual commitment with any of its officers or        directors.

 

The Company        has no current plans for any significant purchase or sale of any plant or        equipment.

 

 

 

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***Off Balance Sheet Arrangements***

 

As of        September 30, 2007, the Company has no significant off-balance sheet arrangements that have        or are reasonably likely to have a current or future effect on our financial condition,        changes in financial condition, revenues or expenses, results of operations, liquidity,        capital expenditures, or capital resources that is material to stockholders.

 

**Forward Looking Statements and Factors that May Affect Future Results        and Financial Condition** 

 

The        statements contained in the section titled*Management’s Plan        of Operation*, with the exception of historical facts, are forward        looking statements within the meaning of Section 27A of the Securities Act. A safe-harbor        provision may not be applicable to the forward looking statements made in this Form 10-QSB        because of certain exclusions under Section 27A (b). Forward looking statements reflect our        current expectations and beliefs regarding our future results of operations, performance,        and achievements. These statements are subject to risks and uncertainties and are based        upon assumptions and beliefs that may or may not materialize. These statements include, but        are not limited to, statements concerning:

 

| **•** | our anticipated financial performance and business                        plan; |
|------------|---------------------------------------------------------------------------------|

| **•** | the sufficiency of existing capital resources; |
|------------|------------------------------------------------|

| **•** | our ability to raise additional capital to fund cash                        requirements for future operations; |
|------------|-----------------------------------------------------------------------------------------------------------------|

| **•** | uncertainties related to the Company’s future business                        prospects; |
|------------|------------------------------------------------------------------------------------------------|

| **•** | the ability of the Company to generate revenues to fund                        future operations; |
|------------|---------------------------------------------------------------------------------------------------|

| **•** | the volatility of the stock market; and |
|------------|-----------------------------------------|

| **•** | general economic conditions. |
|------------|------------------------------|

 

We wish to        caution readers that the Company’s operating results are subject to various risks and        uncertainties that could cause our actual results to differ materially from those discussed        or anticipated in this report. We also wish to advise readers not to place any undue        reliance on the forward looking statements contained in this report, which reflect our        beliefs and expectations only as of the date of this report. We assume no obligation to        update or revise these forward looking statements to reflect new events or circumstances or        any changes in our beliefs or expectations, other than is required by law.

 

**Critical Accounting Policies**

 

In the        notes to the audited consolidated financial statements for the year ended August 31, 2007        included in this Form 10-KSB, the Company discusses those accounting policies that are        considered to be significant in determining the results of operations and our financial        position. The Company believes that the accounting principles utilized by us conform to        accounting principles generally accepted in the United States of America.

 

The        preparation of financial statements requires management to make significant estimates and        judgments that affect the reported amounts of assets, liabilities, revenues and expenses.        By their nature, these judgments are subject to an inherent degree of uncertainty. On an        on-going basis, the Company evaluates our estimates, including those related to bad debts,        inventories, intangible assets, warranty obligations, product liability, revenue, and        income taxes. We base our estimates on historical experience and other facts and        circumstances that are believed to be reasonable, and the results form the basis for making        judgments about the carrying value of assets and liabilities. The actual results may differ        from these estimates under different assumptions or conditions.

 

 

 

21

 

----

 

***Stock-Based Compensation***

 

On January        1, 2006, we adopted SFAS No. 123 (revised 2004) (SFAS No. 123R), Share-Based Payment, which        addresses the accounting for stock-based payment transactions in which an enterprise        receives employee services in exchange for (a) equity instruments of the enterprise or (b)        liabilities that are based on the fair value of the enterprise’s equity instruments        or that may be settled by the issuance of such equity instruments. In January 2005, the        Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin (SAB) No. 107,        which provides supplemental implementation guidance for SFAS No. 123R. SFAS No. 123R        eliminates the ability to account for stock-based compensation transactions using the        intrinsic value method under Accounting Principles Board (APB) Opinion No. 25, Accounting        for Stock Issued to Employees, and instead generally requires that such transactions be        accounted for using a fair-value-based method. We use the Black-Scholes-Merton        (“BSM”) option-pricing model to determine the fair-value of stock-based awards        under SFAS No. 123R, consistent with that used for pro forma disclosures under SFAS No.        123, Accounting for Stock-Based Compensation. We have elected the modified prospective        transition method as permitted by SFAS No. 123R and accordingly prior periods have not been        restated to reflect the impact of SFAS No. 123R. The modified prospective transition method        requires that stock-based compensation expense be recorded for all new and unvested stock        options, restricted stock, restricted stock units, and employee stock purchase plan shares        that are ultimately expected to vest as the requisite service is rendered beginning on        January 1, 2006, the first day of our fiscal year 2006. Stock-based compensation expense        for awards granted prior to January 1, 2006 is based on the grant date fair-value as        determined under the pro forma provisions of SFAS No. 123.

 

Prior to        the adoption of SFAS No. 123R, we measured compensation expense for our employee        stock-based compensation plans using the intrinsic value method prescribed by APB Opinion        No. 25. We applied the disclosure provisions of SFAS No. 123 as amended by SFAS No. 148,        Accounting for Stock-Based Compensation – Transition and Disclosure, as if the        fair-value-based method had been applied in measuring compensation expense. Under APB        Opinion No. 25, when the exercise price of the Company’s employee stock options was        equal to the market price of the underlying stock on the date of the grant, no compensation        expense was recognized.

 

We account        for equity instruments issued in exchange for the receipt of goods or services from other        than employees in accordance with SFAS No. 123 and the conclusions reached by the Emerging        Issues Task Force (“EITF”) in Issue No. 96-18. Costs are measured at the        estimated fair market value of the consideration received or the estimated fair value of        the equity instruments issued, whichever is more reliably measurable. The value of equity        instruments issued for consideration other than employee services is determined on the        earliest of a performance commitment or completion of performance by the provider of goods        or services as defined by EITF 96-18

 

**Recent Accounting Pronouncements**

 

In February        2006, the FASB issued SFAS No. 155, “Accounting for Certain Hybrid Financial        Instruments-an amendment of FASB Statements No. 133 and 140”, to simplify and make        more consistent the accounting for certain financial instruments. SFAS No. 155 amends SFAS        No. 133, “Accounting for Derivative Instruments and Hedging Activities” to        permit fair value remeasurement for any hybrid financial instrument with an embedded        derivative that otherwise would require bifurcation, provided that the whole instrument is        accounted for on a fair value basis. SFAS No. 155 amends SFAS No. 140, “Accounting        for the Impairment or Disposal of Long-Lived Assets”, to allow a qualifying        special-purpose entity to hold a derivative financial instrument that pertains to a        beneficial interest other than another derivative financial instrument. SFAS No. 155        applies to all financial instruments acquired or issued after the beginning of an entity's        first fiscal year that begins after September 15, 2006, with earlier application allowed.        This standard is not expected to have a significant effect on the Company’s future        reported financial position or results of operations.

 

22

 

----

 

In March        2006, the FASB issued SFAS No. 156, "Accounting for Servicing of Financial Assets, an        amendment of FASB Statement No. 140, Accounting for Transfers and Servicing of Financial        Assets and Extinguishments of Liabilities". This statement requires all separately        recognized servicing assets and servicing liabilities be initially measured at fair value,        if practicable, and permits for subsequent measurement using either fair value measurement        with changes in fair value reflected in earnings or the amortization and impairment        requirements of Statement No. 140. The subsequent measurement of separately recognized        servicing assets and servicing liabilities at fair value eliminates the necessity for        entities that manage the risks inherent in servicing assets and servicing liabilities with        derivatives to qualify for hedge accounting treatment and eliminates the characterization        of declines in fair value as impairments or direct write-downs. SFAS No. 156 is effective        for an entity's first fiscal year beginning after September 15, 2006. This adoption of this        statement is not expected to have a significant effect on the Company’s future        reported financial position or results of operations.

 

In        September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” The        objective of SFAS 157 is to increase consistency and comparability in fair value        measurements and to expand disclosures about fair value measurements. SFAS 157 defines fair        value, establishes a framework for measuring fair value in generally accepted accounting        principles, and expands disclosures about fair value measurements. SFAS 157 applies under        other accounting pronouncements that require or permit fair value measurements and does not        require any new fair value measurements. The provisions of SFAS No. 157 are effective for        fair value measurements made in fiscal years beginning after November 15, 2007. The        adoption of this statement is not expected to have a material effect on the Company's        future reported financial position or results of operations.

 

In        September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for        Defined Benefit Pension and Other Postretirement Plans – an amendment of FASB        Statements No. 87, 88, 106, and 132(R)” This statement requires employers to        recognize the overfunded or underfunded status of a defined benefit postretirement plan        (other than a multiemployer plan) as an asset or liability in its statement of financial        position and to recognize changes in that funded status in the year in which the changes        occur through comprehensive income of a business entity or changes in unrestricted net        assets of a not-for-profit organization. This statement also requires an employer to        measure the funded status of a plan as of the date of its year-end statement of financial        position, with limited exceptions. The provisions of SFAS No. 158 are effective for        employers with publicly traded equity securities as of the end of the fiscal year ending        after December 15, 2006. The adoption of this statement is not expected to have a material        effect on the Company's future reported financial position or results of        operations.

 

In        September 2006, the SEC issued Staff Accounting Bulletin        (“SAB”) No. 108, “Considering the Effects of Prior Year        Misstatements when Quantifying Misstatements in Current Year Financial Statements.”        SAB No. 108 addresses how the effects of prior year uncorrected misstatements should        be considered when quantifying misstatements in current year financial statements. SAB        No. 108 requires companies to quantify misstatements using a balance sheet and income        statement approach and to evaluate whether either approach results in quantifying an error        that is material in light of relevant quantitative and qualitative factors. SAB No. 108 is        effective for periods ending after November 15, 2006. The Company is currently        evaluating the impact of adopting SAB No. 108 but does not expect that it will have a        material effect on our financial position and results of operations.

 

In February        2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and        Financial Liabilities”. This Statement permits entities to choose to measure many        financial assets and financial liabilities at fair value. Unrealized gains and losses on        items for which the fair value option has been elected are reported in earnings. SFAS No.        159 is effective for fiscal years beginning after November 15, 2007. The Company is        currently assessing the impact of SFAS No. 159 on our financial position and results of        operations.

 

23

----

 

 

**Going Concern**

 

The        Company’s auditors have noted substantial doubt as to the Company’s ability to        continue as a going concern as a result of an accumulated deficit of $225,024 as of        September 30, 2007. The Company’s ability to continue as a going concern is subject        to the ability of the Company to realize a profit and /or obtain funding from outside        sources. Management’s plan to address the Company’s ability to continue as a        going concern includes: (1) obtaining funding from private placement sources; (2) obtaining        additional funding from the sale of the Company’s securities; (3) establishing        revenues from developing Electrolinks’ business plan; (4) obtaining loans and grants        from various financial institutions where possible. Although management believes that it        will be able to obtain the necessary funding to allow the Company to remain a going concern        through the methods discussed above, there can be no assurances that such methods will        prove successful.

         

**ITEM 7.**

**FINANCIAL STATEMENTS**

The        Company’s financial statements for the fiscal year ended September 30, 2007, are        attached hereto as pages F-1 through F-10.

 

24

 

 

**HIGH        END VENTURES, INC.**

 

Index to        Financial Statements

         

Report of Independent Registered Public Accounting                        Firm

F-2

         

Balance Sheets

F-3

         

Statements of Operations and Deficit

F-4

         

Statements of Cash Flows

F-5

         

Statements of Stockholders’ Equity                        (Deficit)

F-6

         

Notes to Financial Statements

F-7

         

 

 

F-1

 

 

**REPORT        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

 

To the        Board of Directors and

Stockholders of High End Ventures, Inc.

(A        Development Stage Company)

 

We have        audited the accompanying balance sheet of High End Ventures, Inc. (a Development Stage        Company) as of September 30, 2007, and the related statements of operations,        stockholders’ equity, and cash flows for each of the years ended September 30, 2007        and 2006 and for the period from the date of inception on January 19, 1999 to September 30,        2007. High End Venture’s management is responsible for these financial statements.        Our responsibility is to express an opinion on these financial statements based on our        audits.

We        conducted our audits in accordance with the standards of the Public Company Accounting        Oversight Board (United States). Those standards require that we plan and perform the audit        to obtain reasonable assurance about whether the financial statements are free of material        misstatement. The company is not required to have, nor were we engaged to perform, an audit        of its internal control over financial reporting. Our audit included consideration of        internal control over financial reporting as a basis for designing audit procedures that        are appropriate in the circumstances, but not for the purpose of expressing an opinion on        the effectiveness of the company’s internal control over financial reporting.        Accordingly, we express no such opinion. An audit also includes examining, on a test basis,        evidence supporting the amounts and disclosures in the financial statements, assessing the        accounting principles used and significant estimates made by management, as well as        evaluating the overall financial statement presentation. We believe that our audits provide        a reasonable basis for our opinion.

In our        opinion, the financial statements referred to above present fairly, in all material        respects, the financial position of High End Ventures, Inc. (a Development Stage Company)        as of September 30, 2007 and the results of its operations and its cash flows for each of        the years ended September 30, 2007 and 2006 and for the period from the date of inception        on January 19, 1999 to September 30, 2007 in conformity with accounting principles        generally accepted in the United States of America.

The        accompanying financial statements have been prepared assuming the Company will continue as        a going concern as a going concern. As discussed in Note 3 to the financial statements, the        Company has incurred a net loss of $225,024 since inception and has not attained profitable        operations and is dependent upon obtaining adequate financing to fulfill its planned        business activity. These factors raise substantial doubt that the Company will be able to        continue as a going concern. Management’s plans in regard to these matters are also        discussed in Note 3. The financial statements do not include any adjustments that might        result from the outcome of this uncertainty.

 

/s/        Madsen & Associates CPA’s, Inc.

Madsen        & Associates CPA’s, Inc.

Salt        Lake City, Utah 84107

December        21, 2007

 

 

 

 

F-2

 

 

 

**HIGH END VENTURES, INC.**

(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEETS

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

September 30,

                         

                         

                         

                         

                         

                         

2007

                         

                         

                         

                         

                         

                         

                         

**ASSETS**

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Current assets**

                         

                         

                         

                         

                         

Cash and cash equivalents

                         

                         

$

11,412

                         

Loan receivable

                         

                         

                         

266,503

                         

Prepaid expenses

                         

                         

                         

-

                         

                         

                         

                         

                         

                         

                         

**Total current assets**

                         

                         

                         

277,915

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

**TOTAL ASSETS**

                         

                         

$

277,915

                         

                         

                         

                         

                         

                         

                         

**LIABILITIES AND STOCKHOLDERS' DEFICIT**

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Current liabilities**

                         

                         

                         

                         

                         

Accounts payable and accrued liabilities

                         

                         

                         

132,331

                         

Accrued interest payable

                         

                         

                         

12,001

                         

Loans payable

                         

                         

                         

295,107

                         

                         

                         

                         

                         

                         

                         

**Total current liabilities**

                         

                         

                         

439,439

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

**TOTAL LIABILITIES**

                         

                         

                         

439,439

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Stockholders' deficit**

                         

                         

                         

                         

                         

Common stock

                         

                         

                         

                         

                         

100,000,000 common shares authorized at $0.001

par value;

                         

                         

                         

                         

                         

15,850,000 common shares issued and

outstanding (September 30, 2006 - 15,850,000)

                         

                         

                         

15,850

                         

Additional paid-in capital

                         

                         

                         

47,650

                         

Accumulated deficit

                         

                         

                         

(225,024)

                         

                         

                         

                         

                         

                         

                         

**Total stockholders' deficit**

                         

                         

                         

                         

(161,524)

                         

                         

                         

                         

                         

                         

                         

**TOTAL LIABILITIES AND STOCKHOLDERS'                        DEFICIT**

                         

                         

                         

                         

277,915

 

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

 

F-3

 

 

 

**HIGH END VENTURES, INC.**

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF OPERATIONS

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

From January 19, 1999

                         

                         

                         

                         

For the years ended

                         

(Date of inception)

                         

                         

                         

                         

September 30,

                         

through September 30,

                         

                         

                         

                         

2007

                         

2006

                         

2007

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Revenue:

                         

$

-

$

-

$

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Operating expenses

                         

                         

                         

                         

                         

                         

                         

Exploration costs

                         

-

                         

17,000

                         

17,000

                         

General & administrative

                         

174,815

                         

27,024

                         

207,339

Total Operating expenses

                         

174,815

                         

44,024

                         

224,339

                         

                         

                         

                         

                         

                         

                         

                         

                         

Net (Loss) from Operations

$

(174,815)

$

(44,024)

$

(224,339)

                         

                         

                         

                         

                         

                         

                         

                         

                         

Other income (expense)

                         

                         

                         

                         

                         

                         

Interest income

                         

11,316

                         

-

                         

11,316

Interest expense

                         

(12,001)

                         

-

                         

(12,001)

Total Other income (expense)

                         

(685)

                         

-

                         

(685)

                         

                         

                         

                         

                         

                         

                         

                         

                         

NET (LOSS)

$

(175,500)

$

(44,024)

$

(225,024)

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Weighted Average Shares Common Stock**

**Outstanding**

                         

15,850,000

                         

15,850,000

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Net Loss Per Share (Basic and Fully                        Dilutive)**

$

(0.01)

$

(0.00)

                         

                         

 

 

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

 

 

 

 

 

 

 

F-4

 

 

 

**HIGH END VENTURES, INC.**

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CASH FLOWS

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

January 19, 1999

                         

                         

                         

                         

                         

                         

                         

                         

(Inception)

                         

                         

                         

                         

For the years ended

                         

through

                         

                         

                         

                         

September 30,

                         

September 30,

                         

                         

                         

                         

2007

                         

2006

                         

2007

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Cash flows from operating activities**

                         

                         

                         

                         

                         

                         

                         

Net loss

$

(175,500)

$

(44,024)

$

(244,435)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Adjustments to reconcile net loss to net cash

used in operations:

                         

                         

                         

                         

                         

                         

                         

Issuance of stock for services rendered

                         

-

                         

-

                         

500

                         

Write off mineral claims

                         

-

                         

12,000

                         

17,000

                         

Changes in:

                         

                         

                         

                         

                         

                         

                         

Loan receivable

                         

(11,317)

                         

-

                         

                         

                         

Accounts payable and accrued liabilities

                         

132,331

                         

-

                         

132,331

                         

Accrued interest payable

                         

12,001

                         

-

                         

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Net cash used in operating activities

                         

(42,485)

                         

(32,024)

                         

(94,604)

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Cash flows from investing activities**

                         

                         

                         

                         

                         

                         

                         

Purchase mineral claims

                         

-

                         

-

                         

(5,000)

                         

Loan receivable principal advance

                         

(255,186)

                         

-

                         

(255,186)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Net cash used in investing activities

                         

(255,186)

                         

-

                         

(260,186)

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Cash flows from financing activities**

                         

                         

                         

                         

                         

                         

                         

Payment of stock subscription receivable

                         

-

                         

24,000

                         

24,000

                         

Issuance of common stock for cash

                         

-

                         

16,000

                         

27,000

                         

Proceeds from loans payable

                         

295,107

                         

-

                         

295,107

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Net cash provided by financing activities

                         

295,107

                         

40,000

                         

346,107

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Increase (decrease) in cash and cash                        equivalents**

                         

(2,564)

                         

7,976

                         

(8,683)

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Cash and cash equivalents, beginning of                        period**

                         

13,976

                         

6,000

                         

-

                         

                         

                         

                         

                         

                         

                         

                         

                         

**Cash and cash equivalents, end of period**

$

11,412

$

13,976

$

(8,683)

                         

                         

target

                         

(2,564)

                         

                         

                         

                         

**Supplementary information**

                         

                         

                         

                         

                         

                         

                         

Interest paid

$

-

$

-

$

-

                         

Taxes Paid

$

-

$

-

$

-

 

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

 

F-5

 

 

 

 

                         

**HIGH END VENTURES, INC.**

(A DEVELOPMENT STAGE COMPANY)

STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

FOR THE PERIOD FROM JANUARY 19, 1999 (INCEPTION)

THROUGH SEPTEMBER 30, 2007

                         

                         

                         

Preferred Stock

Common Stock

                         

                         

                         

10,000,000 shares authorized

100,000,000 shares

authorized

Additional

                         

Stock

                         

                         

                         

Shares

Par Value

Share

Par Value

Paid-In

Subscription

Accumulated

                         

                         

Issued

$.001 per share

Issued

$.001 per share

Capital

                         

Receivable

Deficit

Total

                         

                         

                         

                         

                         

                         

                         

                         

                         

Issuance of common stock in exchange for services February,                        1999

**-**

                         

**-**

2,500,000

2,500

(2,000)

-

-

500

Balance September 30, 2004

                         

                         

                         

2,500,000

2,500

(2,000)

                         

                         

500

Issuance of common stock for cash and subscriptions at $.004                        per share

**-**

                         

**-**

8,750,000

8,750

26,250

(24,000)

-

11,000

Net (loss) for period

-

                         

-

-

-

-

-

(5,500)

(5,500)

Balance September 30, 2005

**-**

                         

**-**

11,250,000

11,250

24,250

(24,000)

(5,500)

6,000

Payment of stock subscriptions

**-**

                         

**-**

-

-

-

24,000

-

24,000

Issuance of common stock for

mineral claims at $.004 per share

**-**

                         

**-**

3,000,000

3,000

9,000

-

-

12,000

Issuance of common stock for

cash at $.01per share

**-**

                         

**-**

1,600,000

1,600

14,400

-

-

16,000

Net (loss) for period

**-**

                         

**-**

-

-

-

-

(44,024)

(44,024)

Balance September 30, 2006

**-**

                         

**-**

15,850,000

15,850

47,650

-

(49,524)

13,976

Net (loss) for period

-

                         

-

-

-

-

-

(175,500)

(175,500)

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

                         

Balance September 30, 2007

                         

                         

                         

15,850,000

15,850

47,650

-

(225,024)

(161,524)

 

 

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

 

F-6

 

High End        Ventures        (Development Stage Company)        Notes to Consolidated Financial Statements

 

 

 

 

**NOTE 1        – NATURE AND PURPOSE OF BUSINESS**

 

High End        Ventures, Inc. (the “Company”) was incorporated under the laws of the State of        Colorado on January 19, 1999.  The Company was previously engaged in exploration        activities designed to identify economically viable deposits of precious metals, which        activities were unsuccessful and have since been abandoned. During the final quarter of        fiscal 2006 the Company decided to switch its attention to alternative business        opportunities.

 

On        September 21, 2006 the Company executed a letter of intent to acquire The Electrolinks        Corporation (“Electrolinks”), a Toronto, Ontario based development stage        company intending on providing “Smart Grid” applications for power utilities        and buildings that will deliver Broadband over Power Line (BPL) services utilizing any form        of existing electrical infrastructure. The Company executed a formal Securities Exchange        Agreement and Plan of Exchange on October 23, 2006 to acquire 100% of the outstanding        ownership of Electrolinks. Due to legal considerations relevant to the structure of the        anticipated transaction, the Company and Electrolinks mutually agreed not to proceed with        the agreement on September 18, 2007.

         

On        September 18, 2007, the Company and Electrolinks executed a Business Combination Agreement        and an Amalgamation Agreement in order to transact the acquisition of Electrolinks through        the amalgamation of Power Grid Networks Ltd. (“Power Grid”) (a wholly owned        subsidiary of the Company) and Electrolinks.

 

The        Amalgamation Agreement provides for the following actions:

 

 

(a)

to amalgamate Power Grid and Electrolinks;

 

(b)

to exchange two Electrolinks shares for one share of the                        Company;

 

(c)

to exchange shares of Power Grid with the Company on a one                        for one basis for each share issued by the Company to acquire Electrolinks                        shares; and

 

(d)

to continue the business of Electrolinks through Power                        Grid.

 

The        agreement anticipates the amalgamation of Electrolinks and Power Grid, entitling each        stockholder of Electrolinks to one share of the common stock of the Company in exchange for        two shares of the common stock of Electrolinks up to an aggregate of 21,584,183 shares of        the Company for 43,168,366 shares of Electrolinks.

         

The        Electrolinks stockholders will acquire approximately 57.7% of the issued and outstanding        shares of common stock of the Company following the closing of the transaction. For        accounting purposes, the transaction will be treated as a reverse merger with Electrolinks        being the accounting acquirer and the go-forward financial statements will reflect        Electrolinks’ history from its inception. The closing of the transaction is expected        to take place as soon as is practicable subject to shareholder approval of the transaction        and full satisfaction of the disclosure requirements of the Securities Exchange Act of        1934, as amended. The transaction has not obtained the requisite shareholder approvals as        of the date of this report.

 

The        Company has elected September 30 as the end of its fiscal year.

 

 

 

 

 

F-7

 

High End        Ventures        (Development Stage Company)        Notes to Consolidated Financial Statements

 

 

**NOTE        2** **– NATURE OF SIGNIFICANT        ACCOUNTING POLICIES**

 

**Basis        of Presentation**

 

The        accompanying financial statements of High End Ventures, Inc. (the Company) for the years        ended September 30, 2007 and 2006 have been prepared in accordance with accounting        principles generally accepted in the United States (“US GAAP”) and are        expressed in US dollars. The financial statements have been prepared under the guidelines        of Statement of Financial Accounting Standard (“SFAS”) No. 7, “Accounting        and Reporting by Development Stage Enterprises”. A development stage enterprise is        one in which planned principal operations have not commenced or if its operations have        commenced, there have been no significant revenues therefrom. As of September 30, 2007, the        Company has not commenced its planned principal operations.

 

**Cash        and Cash Equivalents**

 

The        Company considers all highly liquid instruments with a stated maturity of three months or        less to be cash and cash equivalents. As of September 30, 2007, cash consists of balances        held with financial institutions. Cash is deposited in institutions that are generally        federally insured in limited amounts.

 

**Use        of Estimates**

 

The        preparation of financial statements in accordance with US GAAP requires management to make        estimates and assumptions that affect the reported amounts of assets and liabilities and        the disclosure of contingent assets and liabilities at the date of the financial        statements, and the reported amounts of revenue and expenses during the reporting period.        Actual results could differ from those estimates.

 

**Fair        Value of Financial Instruments**

 

The        Company’s short-term financial instruments consist of cash and cash equivalents and        accounts payable.  The carrying amounts of these financial instruments approximate        fair value because of their short-term maturities.  Financial instruments that        potentially subject the Company to a concentration of credit risk consist principally of        cash.  During the year the Company did not maintain cash deposits at financial        institution in excess of the $100,000 limit covered by the Federal Deposit Insurance        Corporation.  The Company does not hold or issue financial instruments for trading        purposes nor does it hold or issue interest rate or leveraged derivative financial        instruments.

 

 

 

 

 

 

F-8

 

 

High End Ventures        (Development Stage Company)        Notes to Consolidated Financial Statements

 

**NOTE        2** **– NATURE OF SIGNIFICANT        ACCOUNTING POLICIES - continued**

 

**Earnings per Share**

 

Basic        Earnings per Share (“EPS”) is computed by dividing net income available to        common stockholders by the weighted average number of common stock shares outstanding        during the year.  Diluted EPS is computed by dividing net income available to common        stockholders by the weighted-average number of common stock shares outstanding during the        year plus potential dilutive instruments such as stock options and warrant.  The        effect of stock options on diluted EPS is determined through the application of the        treasury stock method, whereby proceeds received by the Company based on assumed exercises        are hypothetically used to repurchase the Company’s common stock at the average        market price during the period.  Loss per share is unchanged on a diluted basis since        the assumed exercise of common stock equivalents would have an anti-dilutive effect. At        September 30 2007 and 2006 the Company did not have any potentially dilutive instruments        outstanding.

 

**Income Taxes**

 

The        Company uses the asset and liability method of accounting for income taxes as required by        SFAS No. 109 “Accounting for Income Taxes”.  SFAS 109 requires the        recognition of deferred tax assets and liabilities for the expected future tax consequences        of temporary differences between the carrying amounts and the tax basis of certain assets        and liabilities.  Deferred income tax assets and liabilities are computed annually for        the difference between the financial statement and tax bases of assets and liabilities that        will result in taxable or deductible amounts in the future, based on enacted tax laws and        rates applicable to the periods in which the differences are expected to affect taxable        income.  Valuation allowances are established when necessary to reduce deferred tax        assets to the amount expected to be realized.  Income tax expense is the tax payable        or refundable for the period, plus or minus the change during the period in deferred tax        assets and liabilities.

 

Deferred        income taxes may arise from temporary differences resulting from income and expense items        reported for financial accounting and tax purposes in different periods.  Deferred        taxes are classified as current or non-current, depending on the classification of the        assets and liabilities to which they relate.  Deferred taxes arising from temporary        differences that are not related to an asset or liability are classified as current or        non-current depending on the periods in which the temporary differences are expected to        reverse.  The Company had no significant deferred tax items arise during any of the        periods presented.

 

**Concentration of Credit Risk:**

 

The        financial instrument which potentially subjects the Company to concentration of credit risk        is cash. The Company maintains cash in bank accounts that, at times, may exceed federally        insured limits. As of September 30, 2007, the Company has not exceeded the federally        insured limit. The Company has not experienced any losses in such accounts and believes it        is not exposed to any significant risks on its cash in bank accounts.

 

**Recent Accounting Pronouncements:**

 

In        February, 2007, the FASB issued SFAS No. 159 “The Fair Value Option for Financial        Assets and Financial Liabilities”. SFAS No. 159 permits entities to choose to measure        many financial assets and financial liabilities at fair value. Unrealized gains and losses        on items for which the fair value option has been elected are reported in earnings. SFAS        No. 159 is effective for fiscal years beginning after November 15, 2007. The Company is        currently assessing the impact of SFAS No. 159 on our financial position and results of        operations, but does not anticipate a material impact.

 

 

F-9

 

 

High End Ventures        (Development Stage Company)        Notes to Consolidated Financial Statements

 

**NOTE        3 – GOING CONCERN**

 

The        accompanying financial statements have been prepared in conformity with generally accepted        accounting principles that contemplate continuation of the Company as a going        concern.

 

The        Company has incurred losses since its inception and has not yet been successful in        establishing profitable operations. These factors raise considerable doubt about the        ability of the Company to continue as a going concern. Continuance of the Company as a        going concern is dependent upon receiving additional working capital through loans and/or        additional sales of the Company’s common stock. There is no assurance that the        Company will succeed in raising this additional capital or achieving profitable operations.        The accompanying financial statements do not include any adjustments that might result from        the outcome of these uncertainties.

 

**NOTE        4 – LOAN RECEIVABLE**

 

The        Company has loaned Electrolinks $255,186 USD. This loan is secured and bears interest at a        rate of 10% and is repayable upon demand. At September 30, 2007 interest receivable of        $11,317 had been accrued on this loan.

 

**NOTE        5 – MINERAL CLAIM**

 

The        Company entered into an agreement on October 31, 2005 to acquire a 100% interest in a        mineral claim located in the Victoria Mining District in British Columbia, Canada.         The claim was acquired for $5,000 in cash and 600,000 shares of common stock valued        at $12,000.  The purchase price of the claim approximated the historical cost basis of        the previous owner of the claim.  Management has made a determination that the cost of        the mineral claim will not be recovered and therefore the purchase price of $17,000 was        charged to current operations as exploration costs in 2006.

 

**NOTE        6 – SHORT TERM LOANS PAYABLE – RELATED PARTY TRANSACTIONS**

 

The        Company borrowed $270,000 and $25,000 from third parties to assist with working capital        needs. The loan of $270,000 bears interest at a rate of 10%. At September 30, 2007 interest        of $12,001 had been accrued on this loan. The loan of $25,000 is an interest free,        unsecured, demand loan. The Company also borrowed $107 from a shareholder as an        interest-free, unsecured, demand loan.

 

**NOTE        7 – COMMON STOCK**

 

In        October of 2005, the Company issued 600,000 shares for the purchase of mineral claims at a        value of $.02 per share.

 

On April        10, 2006, the Company issued 320,000 shares of common stock valued at $.05 per share for        cash in the amount of $16,000.

 

On        September 2, 2006, management authorized a 5 for 1 forward split of the outstanding shares        of common stock.  This split has been applied retroactively in the financial        statements as if the split had occurred at inception of the Company.

 

 

 

 

F-10

 

 

**ITEM 8.**

**CHANGES IN AND DISAGREEMENTS WITH                        ACCOUNTANTS**

There have        been no disagreements on accounting and financial disclosures from the inception of the        Company through the date of this report.

 

**ITEM 8A.**

**CONTROLS AND PROCEDURES**

 

***(a)        Evaluation of Disclosure Controls and Procedures***

 

Under the        supervision and with the participation of our management, including our principal executive        officer and principal financial officer, we evaluated the effectiveness of the design and        operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and        15d-15(e) under the Exchange Act, as of September 30, 2007. Based on this evaluation, our        principal executive officer and our principal financial officer concluded that, as of the        end of the period covered by this report, our disclosure controls and procedures were        effective and adequately designed to ensure that the information required to be disclosed        by us in the reports we submit under the Exchange Act is recorded, processed, summarized        and reported within the time periods specified in the applicable rules and forms and that        such information was accumulated and communicated to our chief executive officer and chief        financial officer, in a manner that allowed for timely decisions regarding        disclosure.

 

***(b)        Changes in Internal Controls***

 

During the        period ended September 30, 2007, there has been no change in internal control over        financial reporting that has materially affected, or is reasonably likely to materially        affect our internal control over financial reporting.

 

**ITEM 8B.**

**OTHER INFORMATION**

 

None.

 

**PART        III**

 

**ITEM 9.**

**DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL                        PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT**

 

**Executive Officers and Directors**

The        following table sets forth certain information concerning the Company’s executive        officer and director as of December 21, 2007:

 

***Name***

                         

***Age***

                         

***Position with the Company***

Nadir Walji

                         

56

                         

President, Chief Executive Officer, Chief Financial Officer,                        and Director

         

Below is a        brief description of the background and business experience of our current executive        officer and director.

 

***Nadir        Walji***was appointed as a director, principal accounting        officer, secretary and treasurer of the Company on September 2, 2006 and was appointed as        the Corporation’s chief executive officer on June 6, 2007.

 

25

 

 

Mr. Walji        is a business consultant who has experience in developing the application of new        technologies. He has partnered with ERA-GSM deploying wireless mobile communication        networks in Poland and currently serves as an officer and director of certain public        companies. Mr. Walji has served since 2000 as the secretary for Brasiclica Mining Corp., a        copper mining company; as a director of Sudamet Ventures Inc., an inactive company from        2000; as a director of Chilean Gold Ltd., an inactive company since 2000; as a director of        Orex Ventures Inc., an inactive company since 2000; and as a director of ComCam, Inc. from        2002 until November of 2004.

 

**Term of        Office**

 

Our sole        director has been appointed for a one (1) year term to hold office until the next annual        meeting of our stockholders or until removed from office in accordance with our bylaws. Our        executive officers are appointed by our Board of Directors and hold office until removed by        the board.

 

**Significant Employees**

 

We have no        significant employees other than our officer and director, Mr. Walji.

 

**Compensation**

 

The        director received no compensation for his services as director for the fiscal year ended        September 30, 2007.

 

**Involvement in Certain Legal Proceedings**

 

To the best        of our knowledge, during the past five years, none of the following occurred with respect        to a present or former director, executive officer, or employee: (1) any bankruptcy        petition filed by or against any business of which such person was a general partner or        executive officer either at the time of the bankruptcy or within two years prior to that        time; (2) any conviction in a criminal proceeding or being subject to a pending criminal        proceeding (excluding traffic violations and other minor offences); (3) being subject to        any order, judgment or decree, not subsequently reversed, suspended or vacated, of any        court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending        or otherwise limiting his or her involvement in any type of business, securities or banking        activities; and (4) being found by a court of competent jurisdiction (in a civil action),        the Commission or the Commodities Futures Trading Commission to have violated a federal or        state securities or commodities law, and the judgment has not been reversed, suspended or        vacated.

 

**Director Independence**

 

Our common        stock is listed on the OTC Bulletin Board inter-dealer quotation system, which does not        have director independence requirements. For purposes of determining director independence,        we have applied the definitions set out in NASDAQ Rule 4200(a)(15). Under NASDAQ Rule        4200(a)(15), a director is not considered to be independent if he or she is also an        executive officer or employee of the corporation. Nadir Walji is our sole director;        accordingly, we do not have any independent directors.

 

**Board of        Directors Committees**

 

The board        of directors has not established an audit committee or a compensation committee.

 

 

 

26

 

 

Our entire        board of directors performs the functions of an audit committee, but no written charter        governs the actions of our board of directors when performing the functions of that would        generally be performed by an audit committee. Our board of directors approves the selection        of our independent accountants and meets and interacts with the independent accountants to        discuss issues related to financial reporting. In addition, our board of directors reviews        the scope and results of the audit with the independent accountants, reviews with        management and the independent accountants our annual operating results, considers the        adequacy of our internal accounting procedures and considers other auditing and accounting        matters including fees to be paid to the independent auditor and the performance of the        independent auditor.

 

We do not        have an audit committee financial expert because of the size of our company and our board        of directors at this time. We believe that we do not require an audit committee financial        expert at this time because we retain outside consultants who possess these attributes. For        the fiscal year ending September 30, 2007, our board of directors: 1) reviewed and        discussed the audited financial statements with management, and 2) reviewed and discussed        the written disclosures and the letter from our independent auditors on the matters        relating to the auditor’s independence. Based upon our board of directors’        review and discussion of the matters above, our board of directors authorized inclusion of        the audited financial statements for the year ended September 30, 2007 to be included in        this Annual Report on Form 10-KSB and filed with the Commission.

 

Certain        stock exchanges currently require companies to adopt a formal written charter that        establishes an audit committee that specifies the scope of an audit committee’s        responsibilities and the means by which it carries out those responsibilities. In order to        be listed on any of these exchanges, we will be required to establish an audit        committee.

 

**Code of        Ethics**

 

The Company        has adopted a Code of Ethics within the meaning of Item 406(b) of Regulation S-B of the        Securities Exchange Act of 1934. The Code of Ethics applies to directors and senior        officers, such as the principal executive officer, principal financial officer, controller,        and persons performing similar functions. The Company has included a copy of our Code of        Ethics as Exhibit 14 to this Form 10-KSB. Further, the Company’s Code of Ethics is        available in print, at no charge, to any security holder who requests such information by        contacting the Company.

 

**Compliance with Section 16(a) of the Exchange Act**

 

Based        solely upon a review of Forms 3, 4 and 5 furnished to the Company, we are aware of the        following individuals who during the period ended September 30, 2007 was a director, and        officer, or beneficial owner of more than ten percent of our common stock, and who failed        to file, on a timely basis, reports required by Section 16(a) of the Securities Exchange        Act of 1934:

 

**•**

Thomas Forzani, a beneficial owner of more than ten percent                        of our common stock;

**•**

Joseph Montgomery, a beneficial owner of more than ten                        percent of our common stock; and

**•**

Nadir Walji, our executive officer and director.

 

 

 

 

 

27

 

 

**ITEM 10.**

**EXECUTIVE COMPENSATION**

 

**Compensation Discussion and Analysis**

 

The        objective of the Company’s compensation program is to provide compensation for        services rendered as an executive officer. The Company’s salaries are designed to        retain the services of our executive officer. The Company’s stock awards are designed        to provide compensation for extraordinary services to the Company. Salary and stock awards        are currently the only types of compensation we utilize in our compensation program. We        utilized these forms of compensation because we feel that they are adequate to retain and        motivate our executive officer. The amounts we deem appropriate to compensate our executive        officer are determined in accordance with market forces; we have no specific formula to        determine compensatory amounts at this time. While we have deemed that our current        compensatory program and the decisions regarding compensation are easy to administer and        are appropriately suited for our objectives, we may expand our compensation program to any        additional future employees to include options and other compensatory elements.

 

**Tables**

 

The        following table provides summary information for fiscal year 2007 concerning cash and        non-cash compensation paid or accrued by the Company to or on behalf of (i) the chief        executive officer and (ii) any other employee to receive compensation in excess of        $100,000.

 

***Summary Compensation Table***

Name and Principal Position

Year

Salary

($)

Bonus

($)

Stock Awards

($)

Option

Awards

($)

Non-Equity Incentive Plan Compensation

($)

Change in Pension Value and Nonqualified Deferred                        Compensation

($)

All Other Compensation

($)

                         

Total

($)

Nadir Walji

CEO, CFO, PAO, and director

2007

                         

-

                         

-

                         

-

                         

-

                         

-

                         

-

                         

$60,000

                         

$60,000

                         

 

We have no        “Grants of Plan-Based Awards”, “Outstanding Equity Awards at Fiscal        Year-End”, “Option Exercises and Stock Vested”, “Pension        Benefits”, or “Nonqualified Deferred Compensation”. Nor do we have any        “Post Employment Payments” to report.

 

**ITEM 11.**

**SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS                        AND**

**MANAGEMENT**

         

The        following table sets forth certain information concerning the ownership of the        Company’s common stock as of December 21, 2007, with respect to: (i) all directors;        (ii) each person known by us to be the beneficial owner of more than five percent of our        common stock; and (iii) our directors and executive officers as a group.

 

 

 

 

28

 

 

 

Title of

Class

Names and Addresses of Management, Nominees

And Certain Beneficial Owners

Number of Shares

Percent of

Class

Common

Nadir Walji, CEO, CFO,                        director

c/o High End Ventures, Inc.,                        Suite 2610, 1066 West Hastings Street, Vancouver BC, Canada V6E                        3X2.

0

0%

Common

Thomas Forzani

Calgary, AB Canada

2,500,000

15.8%

Common

Joseph Montgomery

Vancouver, BC                        Canada

3,000,000

18.9%

Common

Officer and Directors as a Group

0

0%

 

 

**ITEM 12.**

**CERTAIN RELATIONSHIPS AND RELATED                        TRANSACTIONS**

 

Except as        disclosed below, none of our directors or executive officers, nor any proposed nominee for        election as a director, nor any person who beneficially owns, directly or indirectly,        shares carrying more than 5% of the voting rights attached to all of our outstanding        shares, nor any members of the immediate family (including spouse, parents, children,        siblings, and in-laws) of any of the foregoing persons has any material interest, direct or        indirect, in any transaction over the last two years or in any presently proposed        transaction which, in either case, has or will materially affect us.

 

Nadir        Walji, our executive officer and director, receives $5,000 in management fees per        month.

 

**ITEM 13.**

**EXHIBITS**

 

Exhibits        required to be attached by Item 601 of Regulation S-B are listed in the Index to Exhibits        beginning on page 32 of this Form 10-KSB, which is incorporated herein by        reference.

 

**ITEM 14.**

**PRINCIPAL ACCOUNTANT FEES AND SERVICES.**

 

***Audit        Fees***

 

The        aggregate fees billed by our auditors for professional services rendered in connection with        a review of the financial statements included in our annual report on Form 10-KSB and the        audit of our annual consolidated financial statements for the fiscal years ended September        30, 2007 and 2006 were approximately $13,500 and $6,400, respectively.

 

***Audit-Related Fees***

 

Our        auditors did not bill additional fees for assurance and related services that are        reasonably related to the performance of the audit or review of our financial        statements.

 

***Tax        Fees***

 

The        aggregate fees billed by our auditors for professional services for tax compliance, tax        advice, and tax planning were $0 and $0 for the fiscal years ended September 30, 2007 and        2006.

 

 

29

 

 

 

***All        Other Fees***

 

The        aggregate fees billed by our auditors for all other non-audit services, such as attending        meetings and other miscellaneous financial consulting, for the fiscal years ended September        30, 2007 and 2006 were $0 and $0 respectively.

 

***Audit        Committee Pre-Approval***

 

The Company        does not have a standing audit committee therefore all services provided to the Company by        Madison & Associates CPA’s, as detailed above, were pre-approved by the        Company’s board of directors. Madison & Associates CPA’s performed all work        only with their permanent full time employees.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30

 

 

 

**SIGNATURES**

 

In        accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report        to be signed on its behalf by the undersigned, thereunto duly authorized, this        21st day of December 2007.

 

                         

High End Ventures, Inc.

                         

                         

                         

/s/ Nadir Walji

Nadir Walji, Chief Executive Officer, Chief Financial                        Officer and Principal Accounting Officer

 

 

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

 

***Signature***

***Title***

***Date***

/s/ Nadir Walji

Nadir Walji

                         

Director

                         

December 21, 2007

 

 

 

         

 

31

 

 

**INDEX TO EXHIBITS**

         

***Exhibit***

***Page***

***No.***

***No.***

***Description***

         

3(i)

* Articles of Incorporation (incorporated by reference                        from the Form SB-2 filed with the Commission on May 9, 2006).

         

3(ii)

* Bylaws (incorporated by reference from the Form SB-2                        filed with the Commission on May 9, 2006).

         

10(i)

* Mineral Property Purchase Agreement, dated October                        31, 2005 (incorporated by reference from the Form SB-2 filed with the                        Commission on May 9, 2006).

         

10(ii)

* Securities Exchange Agreement and Plan of Exchange                        between the Company and Electrolinks, dated October 23, 2006 (incorporated                        by reference from the Form 8-K filed with the Commission on October 27,                        2006).

         

10(iii)

* Business Combination Agreement among the Company,                        Electrolinks, and Power Grid, dated September 18, 2007 (with the                        accompanying Amalgamation Agreement attached as Exhibit A) (incorporated by                        reference from the Form 8-K filed with the Commission on September 25,                        2007).

         

14

                         

Attached   Code of Ethics, adopted as of December                        21, 2007.

         

31

Attached  Certification of the Chief Executive                        Officer and Chief Financial Officer pursuant to Rule 13a-14 of the                        Securities and Exchange Act of 1934, as amended, as adopted pursuant to                        Section 302 of the Sarbanes-Oxley Act of 2002.

         

32

Attached  Certification of Chief Executive Officer                        and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted                        pursuant to Section 906 of the Sarbanes-Oxley Act of                        2002.            

         

*

Incorporated by reference to prior filings with the                        Securities and Exchange Commission.

 

32