Item
1. Financial Statements.
The
accompanying unaudited interim financial statements of Fortune Valley Treasures, Inc. (formerly Crypto-Services, Inc.) as of February
28, 2017, have been prepared by our management in conformity with accounting principles generally accepted in the United States
of America and in accordance with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X and, therefore, do not include
all information and footnotes necessary for a complete presentation of financial position, results of operations, cash flows,
and stockholders’ equity in conformity with generally accepted accounting principles. In the opinion of management, all
adjustments considered necessary for a fair presentation of the results of operations and financial position have been included
and all such adjustments are of a normal recurring nature.
Operating
results for the six-month period ended February 28, 2017 are not necessarily indicative of the results that can be expected for
the year ending August 31, 2016.
As
used in this Quarterly Report, the terms “we,” “us,” “our,” “Fortune Valley,”
and the “Company” mean Fortune Valley Treasures, Inc. unless otherwise indicated. All dollar amounts in this Quarterly
Report are expressed in U.S. dollars, unless otherwise indicated.
Fortune
Valley Treasures, Inc. (formerly Crypto-Services, Inc.)
Balance
Sheets
|
|
February 28, 2017
|
|
|
August 31, 2016
|
|
|
|
(Unaudited)
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Current Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prepaid expenses
|
|
$
|
12,678
|
|
|
$
|
8,833
|
|
|
|
|
|
|
|
|
|
|
Total Current Assets
|
|
$
|
12,678
|
|
|
$
|
8,833
|
|
|
|
|
|
|
|
|
|
|
Total Assets
|
|
$
|
12,678
|
|
|
$
|
8,833
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
$
|
13,897
|
|
|
$
|
20,150
|
|
Due to related party
|
|
|
45,830
|
|
|
|
3,000
|
|
Total Current Liabilities
|
|
|
59,727
|
|
|
|
23,150
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
$
|
59,727
|
|
|
$
|
23,150
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock authorized: 75,000,000 shares, par value $0.001, 7,750,000 common shares issued and outstanding as of February 28, 2017 and August 31, 2016, respectively
|
|
|
7,750
|
|
|
|
7,750
|
|
|
|
|
|
|
|
|
|
|
Additional paid-in capital
|
|
|
81,729
|
|
|
|
71,229
|
|
|
|
|
|
|
|
|
|
|
Accumulated deficit
|
|
|
(136,528
|
)
|
|
|
(93,296
|
)
|
|
|
|
|
|
|
|
|
|
Total Stockholders’ Deficit
|
|
|
(47,049
|
)
|
|
|
(14,317
|
)
|
|
|
|
|
|
|
|
|
|
Total Liabilities and Stockholders’ Deficit
|
|
$
|
12,678
|
|
|
$
|
8,833
|
|
The
accompanying notes are an integral part of these unaudited financial statements
Fortune
Valley Treasures, Inc. (formerly Crypto-Services, Inc.)
Statements
of Operations
(Unaudited)
|
|
For the Three
Months Ended
|
|
|
For the Three
Months Ended
|
|
|
For the Six
Months Ended
|
|
|
For the Six
Months Ended
|
|
|
|
February 28, 2017
|
|
|
February 29, 2016
|
|
|
February 28, 2017
|
|
|
February 29, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses
|
|
|
24,678
|
|
|
|
4,041
|
|
|
|
43,232
|
|
|
|
29,166
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses
|
|
|
24,678
|
|
|
|
4,041
|
|
|
|
43,232
|
|
|
|
29,166
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations
|
|
$
|
(24,678
|
)
|
|
$
|
(4,041
|
)
|
|
$
|
(43,232
|
)
|
|
$
|
(29,166
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense)
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(24,678
|
)
|
|
$
|
(4,041
|
)
|
|
$
|
(43,232
|
)
|
|
$
|
(29,166
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss Per Common Share – Basic and Diluted
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Common Shares Outstanding
|
|
|
7,750,000
|
|
|
|
7,750,000
|
|
|
|
7,750,000
|
|
|
|
7,750,000
|
|
The
accompanying notes are an integral part of these unaudited financial statements
Fortune
Valley Treasures, Inc. (formerly Crypto-Services, Inc.)
Statements
of Cash Flows
(Unaudited)
|
|
For the Six Months Ended
|
|
|
|
February 28, 2017
|
|
|
February 29, 2016
|
|
|
|
|
|
|
|
|
|
|
Cash Flows From Operating Activities:
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(43,232
|
)
|
|
$
|
(29,166
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
1,500
|
|
Loan forgiven by former shareholder
|
|
|
(10,500
|
)
|
|
|
-
|
|
Expenses paid by related party on behalf of the Company
|
|
|
42,830
|
|
|
|
|
|
Prepaid expense
|
|
|
(3,845
|
)
|
|
|
-
|
|
Accounts payable
|
|
|
4,247
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Cash Used in Operating Activities
|
|
|
-
|
|
|
|
(27,666
|
)
|
|
|
|
|
|
|
|
|
|
Net Decrease in Cash and Cash Equivalents
|
|
|
-
|
|
|
|
(27,666
|
)
|
|
|
|
|
|
|
|
|
|
Cash and Cash Equivalents at Beginning of period
|
|
|
-
|
|
|
|
42,492
|
|
|
|
|
|
|
|
|
|
|
Cash and Cash Equivalents at End of Period
|
|
$
|
-
|
|
|
$
|
14,826
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosures of Cash Flow Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest paid
|
|
$
|
-
|
|
|
$
|
-
|
|
Income taxes paid
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
Non-Cash Investing and Financing Activity:
|
|
|
|
|
|
|
|
|
Loan forgiven by former shareholder
|
|
$
|
10,500
|
|
|
$
|
-
|
|
The
accompanying notes are an integral part of these unaudited financial statements
Fortune Valley Treasures, Inc. (formerly
Crypto-Services, Inc.)
Notes to Financial Statements
(Unaudited)
1. Nature of Operations
Fortune Valley Treasures,
Inc., formerly Crypto-Services, Inc., was incorporated in the State of Nevada as a for-profit company on March 21, 2014 and established
a fiscal year end of August 31. The Company is an early stage company which intended to offer an information based website at www.digitalcoindaily.com
that would provide users with up to date information on the world of digital currencies.
Gordon Hum, the Company’s director, President,
Treasurer, Secretary, Chief Executive Officer, Chief Financial Officer and holder of 3,500,000 shares of the Company’s common
stock representing approximately 45.16% of the Company’s issued and outstanding securities, entered into a Stock Purchase
Agreement, pursuant to which he agreed to sell to twelve unrelated third parties all of his securities of the Company, for aggregate
cash consideration of $35,000. On the same day, Edwin Jong, the Company’s director, Vice President and holder of 1,500,000
shares of the Company’s common stock representing approximately 19.35% of the Company’s issued and outstanding securities,
entered into a Stock Purchase Agreement, pursuant to which he agreed to sell to five unrelated third parties all of his securities
of the Company, for aggregate cash consideration of $15,000. In connection with the sales of the Company’s securities, Gordon
Hum and Edwin Jong resigned from all of their positions with the Company effective August 3, 2016. Concurrently, Xinlong Shen was
appointed to serve as the sole director, President, Treasurer, Secretary, Chief Executive Officer and Chief Financial Officer of
the Company. Effective December 14, 2016, the Company accepted the resignation of Xinlong Shen from the position of President,
Secretary and Treasurer. He will remain on the Board as a director. Also effective December 14, 2016, the Company appointed Yumin
Lin as the new President, Secretary and Treasurer. He will also serve as a director.
Effective August 28, 2016, shareholders of
Crypto-Services, Inc. representing 54.19% of the Company’s issued stock approved changing the Company’s name from Crypto-Services,
Inc., to Fortune Valley Treasures, Inc. The Company filed a Certificate of Amendment with the State of Nevada on September 21,
2016. Effective March 29, 2017, we received formal notification from FINRA that our request to change the Company name from Crypto-Services,
Inc. to Fortune Valley Treasures, Inc. and to change our trading symbol from CRYT to FVTI have been approved. On March 30, 2017
our name and symbol change took effect with FINRA and on the OTCMarkets OTCQB platform.
Effective December 14, 2016, the Company executed
a Sale and Purchase Agreement (the Agreement”) to acquire 100% of the shares and assets of DaXingHuaShang Investment Group
Limited (“DIGL”), a company incorporated under the laws of Republic of Seychelles. Pursuant to the Agreement, the Company
has agreed to issue 300 million shares of the Company to DIGL to acquire 100% of the shares and assets for a cost of $12 million
reflecting the value of the rights, titles and interests in the business assets and all attendant or related assets of DIGL. Both
partied agreed that this share issuance by the Company represents payment in full of the $12 million. As of the February 28, 2017,
the agreement has not been closed and the Company has not yet increased the authorized shares and issue the 300 million shares.
2. Going Concern
These financial statements have been prepared
on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal
course of business. During the period ended February 28, 2017, the Company had recurring losses and net cash used in operations,
and had accumulated deficit of $136,528 as of February 28, 2017. The continuation of the Company as a going concern is dependent
upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to
continue operations, and the attainment of profitable operations. These factors raise substantial doubt regarding the Company’s
ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification
of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as
a going concern.
3. Basis of Presentation
The accompanying unaudited interim financial
statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the
rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements and notes
thereto for the year ended August 31, 2016 contained in the Company’s Form 10-K/A filed with the Securities and Exchange
Commission on February 17, 2017. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary
for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected
herein. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the
full year. Notes to the interim financial statements which would substantially duplicate the disclosure contained in the audited
financial statements as reported in the Company’s Form 10-K/A have been omitted. These financial statements and notes are
presented in accordance with accounting principles generally accepted in the United States. The Company’s fiscal year end
is August 31.
4. Related Party Transactions
|
a)
|
Our former CEO Gordon Hum assumed $10,500 accrued liabilities occurred before his resignation on August 3, 2016 and paid off on November 30, 2016. Gordon Hum forgave the repayment of $10,500 from the Company, which was recorded as gain on liabilities paid by former shareholder.
|
|
|
|
|
b)
|
As of February 28, 2017, the Company was indebted to the then-CEO Xinlong Shen in the amount of $45,830, which is non-interest bearing, unsecured, and due on demand. This is an advance from Xinlong Shen to finance the operation of the Company.
|
|
|
|
|
c)
|
A friend of Xinlong Shen provided non-compensated financial reporting services from August 2016 to February, 2017.
|
|
|
|
|
d)
|
Our principal executive office of the Company is provided by a friend of Xinlong Shen at no charge.
|
5. Subsequent Event
Effective December 14, 2016, the Company executed
a Sale and Purchase Agreement (the Agreement”) to acquire 100% of the shares and assets of DaXingHuaShang Investment Group
Limited (“DIGL”), a company incorporated under the laws of Republic of Seychelles. Pursuant to the Agreement, the Company
has agreed to issue 300 million shares of the Company to DIGL to acquire 100% of the shares and assets for a cost of $12 million
reflecting the value of the rights, titles and interests in the business assets and all attendant or related assets of DIGL. Both
parties agreed that this share issuance by the Company represents payment in full of the $12 million. As of February 28, 2017,
the agreement has not been closed and the Company has not yet increased the authorized shares and issue the 300 million shares.
Item 2. Management’s Discussion and Analysis
of Financial Condition and Results of Operations.
This section includes a number of forward-looking
statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are
often identified by words like “believe”, “expect”, “estimate”, “anticipate”, “intend”,
“project” and similar expressions, or words which, by their nature, refer to future events. You should not place undue
certainty on these forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties
that could cause actual results to differ materially from our predictions.
We qualify as an “emerging growth company”
under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For
so long as we are an emerging growth company, we will not be required to:
|
●
|
have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;
|
|
|
|
|
●
|
comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); ·
|
|
|
|
|
●
|
submit certain executive compensation matters to shareholder advisory votes, such as “say-on-pay” and “say-on-frequency;” and
|
|
|
|
|
●
|
disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation.
|
In addition, Section 107 of the JOBS Act also
provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of
the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay
the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected
to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable
to those of companies that comply with such new or revised accounting standards.
We will remain an “emerging growth company”
for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues
exceed $1 billion, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities
Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700
million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued
more than $1 billion in non-convertible debt during the preceding three year period.
Overview
Fortune Valley Treasures, Inc. (the “Company”),
formerly Crypto-Services, Inc. was incorporated in the State of Nevada as a for-profit company on March 21, 2014 and established
a fiscal year end of August 31. The Company is an early stage company which intended to offer an information based website at www.digitalcoindaily.com
that would provide users with up to date information on the world of digital currencies.
Gordon Hum, the Company’s director, President,
Treasurer, Secretary, Chief Executive Officer, Chief Financial Officer and holder of 3,500,000 shares of the Company’s common
stock representing approximately 45.16% of the Company’s issued and outstanding securities, entered into a Stock Purchase
Agreement, pursuant to which he agreed to sell to twelve unrelated third parties all of his securities of the Company, for aggregate
cash consideration of $35,000. On the same day, Edwin Jong, the Company’s director, Vice President and holder of 1,500,000
shares of the Company’s common stock representing approximately 19.35% of the Company’s issued and outstanding securities,
entered into a Stock Purchase Agreement, pursuant to which he agreed to sell to five unrelated third parties all of his securities
of the Company, for aggregate cash consideration of $15,000. In connection with the sales of the Company’s securities, Gordon
Hum and Edwin Jong resigned from all of their positions with the Company effective August 3, 2016. Concurrently, Xinlong Shen was
appointed to serve as the sole director, President, Treasurer, Secretary, Chief Executive Officer and Chief Financial Officer of
the Company. Effective December 14, 2016, Company accepted the resignation of Xinlong Shen from the position of President, Secretary
and Treasurer. He will remain on the Board as a director. Also effective December 14, 2016, the Company appointed Yumin Lin as
the new President, Secretary and Treasurer. He will also serve as a director.
Effective August 28, 2016, shareholders of
the Company representing 54.19% of the Company’s issued stock approved changing the Company’s name from Crypto-Services,
Inc., to Fortune Valley Treasures, Inc. The Company filed a Certificate of Amendment with the State of Nevada on September 21,
2016. Effective March 29, 2017, we received formal notification from FINRA that our request to change the Company name from Crypto-Services,
Inc. to Fortune Valley Treasures, Inc. and to change our trading symbol from CRYT to FVTI have been approved.
On March 30, 2017 our name and symbol change
took effect with FINRA and on the OTC Markets OTCQB platform.
Effective December 14, 2016, the Company has
accepted the resignation of Xinlong Shen from the position of President, Secretary and Treasurer. He will remain on the Board as
a Director.
Also effective December 14, 2016, the Company
announced the appointment of Yumin Lin to the Board of Directors in the position of President, Secretary and Treasurer. He will
also serve as a Director.
We have had limited operations and have been
issued a “going concern” opinion by our auditor, based upon our reliance on the sale of our common stock as the sole
source of funds for our future operations.
Plan of Operation
We are an early stage company devoting substantially
all of our efforts to establishing a new business for which our planned principal operations have not yet commenced. We believe
our current equity at risk is sufficient to finance our current activities.
Our auditors have issued a going concern opinion
on our audited financial statements for the year ended August 31, 2016.This means that there is substantial doubt that we can continue
as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have
not generated any revenues and no revenues are anticipated until we launch our business platform. There is no assurance we will
ever reach this point. Accordingly, we must raise cash from other sources. Our only other source for cash at this time is investments
by others or loans from our shareholders or officers. We have no assurances that such loans will become available upon acceptable
terms when the funds are required for our operations.
Results of Operations
Our operating results for the three months ended
February 28, 2017 and 2016 are summarized in the table below.
|
|
For the Three
Months
Ended
February 28, 2017
|
|
|
For the Three
Months
Ended
February
29,
2016
|
|
|
For the Six
Months
Ended
February 28, 2017
|
|
|
For the Six
Months
Ended
February 29, 2016
|
|
Revenue
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
General and administrative
|
|
$
|
24,678
|
|
|
$
|
4,041
|
|
|
$
|
43,232
|
|
|
$
|
29,166
|
|
Net Loss
|
|
$
|
(24,678
|
)
|
|
$
|
(4,041
|
)
|
|
$
|
(43,232
|
)
|
|
$
|
(29,166
|
)
|
Revenues
We did not generate any revenue during the
three-month period and six-month period ended February 28, 2017 and 2016.
Operating Expenses
Our expenses were $43,232 for the six months
ended February 28, 2017 as compared to $29,166 for the six months ended February 29, 2016. The increase for the six months was
directly related to the expenses related to consulting and professional fees related to our reporting responsibilities with the
Securities and Exchange Commission (the “SEC”).
Our expenses were $24,678 for the three months
ended February 28, 2017 as compared to $4,041 for the three months ended February 29, 2016. The increase for the three months is
related to consulting and professional fee related to our reporting responsibilities with the SEC.
Capital Resources and Liquidity
Working Capital
|
|
February 28, 2017
|
|
|
August 31, 2016
|
|
Current Assets
|
|
$
|
12,678
|
|
|
$
|
8,833
|
|
Current Liabilities
|
|
$
|
59,727
|
|
|
$
|
23,150
|
|
Working Capital (Deficiency)
|
|
$
|
(47,049
|
)
|
|
$
|
(14,317
|
)
|
Current Assets was $12,678 ended February 28,
2017 as compared to $8,833 ended August 31, 2016. The increase was due to increase in prepaid expense to OTC markets, for our annual
quotation fee for the OTCBB. Current liabilities was $59,727 as of February 28, 2017 compared to $23,150 as of August 31, 2016.
The increase was mainly due to an increase of $42,830 for amounts owing to a related party for paying operating expenses of the
Company.
Cash Flows
|
|
For the Six Months Ended,
|
|
|
|
February 28, 2017
|
|
|
February 29, 2016
|
|
Net cash used in operating activities
|
|
$
|
-
|
|
|
$
|
(27,666
|
)
|
Net cash used in investing activities
|
|
$
|
-
|
|
|
$
|
-
|
|
Net cash provided by financing activities
|
|
$
|
-
|
|
|
$
|
-
|
|
Net change in cash
|
|
$
|
-
|
|
|
$
|
(27,666
|
)
|
Net cash used in operations was $0 for the
six-months period ended February 28, 2017 compared to $27,666 for the period ended February 29, 2016. The decrease in cash outflow
is because of operating expense being paid by a related party. As of February 28, 2017, the Company was indebted to this related
party in the amount of $42,830, which is non-interest bearing, unsecured, and due on demand.
Net cash used in investing activities and financing
activities was $0 for the period ended February 28, 2017 and the period ended February 29, 2016.
We have substantial capital resource requirements
and have incurred significant losses since inception. As of February 28, 2017, we had $0 in cash. Based upon our current business
plans, we will need considerable cash investments to be successful. Such capital requirements are in excess of what we have in
available cash and what we currently have commitment for. Therefore, we do not have enough available cash to meet our obligations
over the next twelve (12) months.
Anticipated Cash Requirements
We will require additional funds to fund our budgeted
expenses over the next 12 months. These funds may be raised through, equity financing, debt financing, or other sources, which
may result in further dilution in the equity ownership of our shares.
We anticipate that our cash expenses over the
next 12 months will be approximately $50,000 as described in the table below. These estimates may change significantly depending
on the nature of our business activities and our ability to raise capital from our shareholders or other sources.
Description
|
|
Estimated Expenses
|
|
Legal and accounting fees
|
|
$
|
34,000
|
|
Marketing and advertising
|
|
|
-
|
|
Investor relations and capital raising
|
|
|
-
|
|
Management and operating costs
|
|
|
-
|
|
Salaries and consulting fees
|
|
|
15,000
|
|
General and administrative expenses
|
|
|
1,000
|
|
Total
|
|
$
|
50,000
|
|
Our general and administrative expenses for
the year will consist primarily of transfer agent fees, bank and interest charges and general office expenses. The professional
fees are related to our regulatory filings throughout the year and include legal, accounting and auditing fees.
Based on our planned expenditures, we will
require approximately $50,000 to proceed with our business plan over the next 12 months. As of February 28, 2017, we had $0 cash
on hand. If we secure less than the full amount of financing that we require, we will not be able to carry out our complete business
plan and we will be forced to proceed with a scaled back business plan based on our available financial resources.
We intend to raise the balance of our cash
requirements for the next 12 months from private placements, shareholder loans or possibly a registered public offering (either
self-underwritten or through a broker-dealer). If we are unsuccessful in raising enough money through such efforts, we may review
other financing possibilities such as bank loans. At this time we do not have a commitment from any broker-dealer to provide us
with financing. There is no assurance that any financing will be available to us or if available, on terms that will be acceptable
to us.
Even though we plan to raise capital through
equity or debt financing, we believe that the latter may not be a viable alternative for funding our operations as we do not have
sufficient tangible assets to secure any such financing. We anticipate that any additional funding will be in the form of equity
financing from the sale of our common stock. However, we do not have any financing arranged and we cannot provide any assurance
that we will be able to raise sufficient funds from the sale of our common stock to finance our operations. In the absence of such
financing, we may be forced to abandon our business plan.
Going Concern
During the period ended February 28, 2017,
the Company had net operating loss and net cash used in operation, and had accumulated deficit of $136,528 as of February 28, 2017.
The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the
ability of the Company to obtain necessary equity financing to continue operations, and the attainment of profitable operations.
These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements
do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities
that might be necessary should the Company be unable to continue as a going concern.
Off-balance sheet arrangements
The Company has no off-balance sheet arrangements
that have or are reasonably likely to have a current or future effect or change on the Company’s financial condition, revenues
or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term
“off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which
an entity unconsolidated with the Company is a party, under which the Company has (i) any obligation arising under a guarantee
contract, derivative instrument or variable interest; or (ii) a retained or contingent interest in assets transferred to such entity
or similar arrangement that serves as credit, liquidity or market risk support for such assets.