Forward-Looking Statements

Except for historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve risks and uncertainties, including, among other things, statements regarding our business strategy, future revenues and anticipated costs and expenses. Such forward-looking statements include, among others, those statements including the words "expects," "anticipates," "intends," "believes" and similar language. Our actual results may differ significantly from those projected in the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed herein. You should carefully review the risks described herein and in other documents we file from time to time with the Securities and Exchange Commission. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.

Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements.




Basis of Presentation


The following discussion highlights our results of operations and the principal factors that have affected our financial condition as well as our liquidity and capital resources for the periods described and provides information that management believes is relevant for an assessment and understanding of the statements of financial condition and results of operations presented herein. The following discussion and analysis are based on our unaudited financial statements contained in this Quarterly Report, which we have prepared in accordance with United States generally accepted accounting principles.

The audited financial statements for our fiscal year ended February 29, 2020, contained in our Annual Report, include a summary of our significant accounting policies and should be read in conjunction with the discussion below. In the opinion of management, all material adjustments necessary to present fairly the results of operations for such periods have been included in these audited financial statements. All such adjustments are of a normal recurring nature.

All references in this Form 10-Q to the "Company," "we," "us," or "our," are to E-Waste Corp. and its consolidated subsidiary.

General Overview

We were organized in the State of Florida on January 26, 2012, to develop an e-waste recycling business. We were not successful in our efforts and discontinued that line of business. Since that time, we have been a "shell company" (as such term is defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the "Exchange Act").

Going forward, we intend to seek, investigate and, if such investigation warrants, engage in a business combination with a private entity whose business presents an opportunity for our shareholders. No specific assets or businesses have been definitively identified and there is no certainty that any such assets or business will be identified or that any transactions will be consummated.

See Part I, Item 1, "Business" and Part I, Item 1A, "Risk Factors," in our Annual Report for the fiscal year ended February 29, 2020, filed with the SEC on June 15, 2020, for additional information and risks associated with our proposed business plan.

On November 29, 2016, we formed a wholly-owned Delaware subsidiary, in connection with our proposed reincorporation in the State of Delaware. The reincorporation was to be effected in anticipation of a potential business combination we were considering. The reincorporation did not occur, as we determined not to proceed with the proposed business combination.

During the next 12 months, we anticipate incurring costs related to filing of Exchange Act reports, and possible costs relating to consummating an acquisition or combination.




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Recent Developments

On September 25, 2020, GEM Global Yield Fund LLC SCS ("GEM"), which was Company's controlling stockholder, sold 6,000,000 shares of the Company's common stock to Global Equity Limited ("Global"), for an aggregate purchase price of $30,000 (the "Share Sale Transaction"). The Shares purchased by Global represented 50% of the Company's issued and outstanding shares of common stock as of the date of the closing of the Share Sale Transaction. Therefore, the Share Sale Transaction resulted in a change in control of the Company. In connection with the consummation of the Share Sale Transaction, Peter de Svastich, who was the Company's sole officer and director resigned from all positions he held with the Company and John D. Rollo was appointed as the Company's. President, Treasurer and Secretary, and the sole member of the Company's board of directors.

In addition, on September 25, 2020, the Company received a loan of $255,000 from a related party (the "$255,000 Loan"). To evidence the $255,000 Loan, the Company issued a promissory note in the principal amount of $255,000 (the "Note"), with a maturity date of September 25, 2021. Interest on the Note accrues on the principal amount at the rate of eight percent (8%) per annum, and shall be paid on a quarterly basis, in the amount of $5,100 per quarter, on the following dates: December 25, 2020, March 25, 2021, June 25, 2021 and September 25, 2021. The Company may prepay any amounts due under the Note without penalty or premium.

The Company used the $255,000 Loan primarily to pay GEM $252,750 (the "Settlement Amount") as full and complete payment, and in full satisfaction, of the total outstanding debt the Company owed to GEM. GEM had previously made advances to the Company in the aggregate amount of $447,451 to pay certain expenses of the Company (the "GEM Debt"). GEM discharged the Company from any further obligations it may have had to GEM to repay any remaining amounts of the GEM Debt, and the Company and GEM released each other from any claims they may have had against each other, with respect to the GEM Debt, or otherwise. The additional $2,250 of proceeds were used by the Company for working capital and general corporate purposes.

On October 14, 2020, the Company sold an aggregate of 1,000,000 shares of the Company's common stock to two "accredited investors," who were related parties, for gross cash proceeds of $50,000. The Company utilized the net proceeds from the sales for working capital and general corporate purposes.

In addition, on October 14, 2020, 3,000,000 shares of the Company's common stock were cancelled and returned to the Company's number of authorized and unissued shares of common stock.

On November 25, 2020, the Company received a loan of $150,000 from a related party (the "$150,000 Loan"). To evidence the $150,000 Loan, the Company issued a promissory note in the principal amount of $150,000 (the "Note"), with a maturity date of November 25, 2021. Interest on the Note accrues on the principal amount at the rate of six percent (6%) per annum, and shall be paid on a quarterly basis, in the amount of $2,250 per quarter, on the following dates: February 25, 2021, May 25, 2021, August 25, 2021 and November 25, 2021. The Company may prepay any amounts due under the Note without penalty or premium.

Results of Operations

Three-Month Period Ended November 30, 2020 Compared to Three-Month Period Ended November 30, 2019




Revenues and Other Income


During the three-month periods ended November 30, 2020 and 2019, we did not realize any revenues from operations.

Operating Expenses

Operating expenses, consisting primarily of general and administrative expenses (including professional fees) totaled $25,330 in the three-month period ended November 30, 2020, compared to $6,489 in the three-month period ended November 30, 2019, which consisted primarily of professional fees. The increase of $18,841, or 290.35%, was due to increase in legal fees related to the Company's recent financing activities and entry into a consulting agreement.

Interest Expense

Interest expense increase by $3,813 to $3,813 for the three month period ended November 30, 2020 from $0 for the three month period ended November 30, 2019. The increase was primarily due to interest on certain Company loans.




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Net Loss

As a result of the foregoing, we incurred a net loss of $29,143, or $0.00 per share, for the three months ended November 30, 2020, compared to a net loss of $6,489, or $0 per share, for the corresponding period ended November 30, 2019.

Nine-Month Period Ended November 30, 2020 Compared to Nine-Month Period Ended November 30, 2019




Revenues and Other Income


During the nine-month periods ended November 30, 2020 and 2019, we did not realize any revenues from operations.

Expenses

Operating expenses, consisting primarily of general and administrative expenses (including professional fees) totaled $54,139 in the nine-month period ended November 30, 2020, compared to $34,885 in the nine-month period ended November 30, 2019, which consisted primarily of ordinary operating expenses and professional fees. The increase of $19,254, or approximately 55.2%, was due to increase in legal fees related to the Company's recent financing activities and entry into a consulting agreement.

Interest Expense

Interest expense increase by $3,813 to $3,813 for the nine month period ended November 30, 2020 from $0 for the nine month period ended November 30, 2019. The increase was primarily due to interest on certain Company loans.

Net Loss

As a result of the foregoing, we incurred a net loss of $57,952, or $0.00 per share, for the nine months ended November 30, 2020, compared to a net loss of $34,885, or $0.00 per share, for the corresponding period ended November 30, 2019.

Liquidity and Capital Resources

As of the date of this report, we had yet to generate any revenues from our business operations.

On September 25, 2020, the Company received the $255,000 Loan from a related party, the majority of which was used to pay GEM the $252,750 Settlement Amount in full satisfaction of the $447,451 GEM Debt. The remaining $2,250 of proceeds were used by the Company for working capital and general corporate purposes.

The Company plans to utilize the net proceeds from the sales for working capital and general corporate purposes. On November 25, 2020, the Company received the $150,000 Loan from a related party. As a result, of November 30, 2020, the total amount of loans made to us by related parties was $405,000 in principal amount.

On October 14, 2020, the Company sold 1,000,000 shares of its common stock to two "accredited investors" for cash proceeds of $50,000.

As of November 30, 2020, we had $182,999 in cash, we had liabilities of $412,392, and our working capital deficit was $229,393. We anticipate that our current liquidity is not sufficient to meet the obligations associated with being a company that is fully reporting with the SEC.

To date, we have managed to keep our monthly cash flow requirement low for two reasons. First, our sole officer has not drawn a significant salary. Second, we have been able to keep our operating expenses to a minimum by operating in space provided at no or minimal expense by related parties.

We currently have no external sources of liquidity such as arrangements with credit institutions or off-balance sheet arrangements that will have or are reasonably likely to have a current or future effect on our financial condition or immediate access to capital.

Our sole director and officer has made no commitments written or oral, with respect to providing a source of liquidity in the form of cash advances, loans and/or financial guarantees.




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We expect that we will need to raise funds in order to effectuate our business plan. We anticipate that we will need to seek financing through means such as borrowings from institutions or private individuals. There can be no assurance that we will be able to raise such funds. If we are unsuccessful at raising sufficient funds, for whatever reason, to fund our operations, we may be forced to seek a buyer for our business or another entity with which we could create a joint venture. If all of these alternatives fail, we expect that we will be required to seek protection from creditors under applicable bankruptcy laws.

We have a history of operating losses and negative cash flow. These conditions raise substantial doubt about our ability to meet all of our obligations over the twelve months following the filing of this Form 10-Q. Management has evaluated these conditions and concluded that current plans will alleviate this concern. We currently have debt obligations to related parties in the total amount of $408,813, consisting of $405,000 in principal amount and $3,813 in accrued interest.

Our ability to continue as a going concern is dependent on our ability to implement our business plan, raise capital and generate revenues.

Cash Flows from Operating Activities

For the nine months ended November 30, 2020, net cash used in operating activities was $64,214, as compared to net cash used in operating activities of $34,885 for the nine months ended November 30, 2019.

Cash Flows from Investing Activities

The Company did not use any funds for investing activities during the nine-month periods ended November 30, 2020 and 2019.

Cash Flows from Financing Activities

For the nine months ended November 30, 2020, net cash provided by financing activities was $247,213. We had no cash provided by financing activities for the nine months ended November 30, 2019.

Going Concern

These consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business.

As reflected in the accompanying unaudited consolidated financial statements, for the nine months ended November 30, 2020, the Company had:




  • Net loss of $57,952; and
  • Net cash used in operations was $64,214.


Additionally, at November 30, 2020, the Company had:




  • Accumulated deficit of $520,359;
  • Stockholders' deficit of $229,393; and
  • Working capital deficit of $229,393.


The Company has cash on hand of $182,999 at November 30, 2020. Although the Company intends to raise additional debt or equity capital, the Company expects to continue to incur significant losses from operations and have negative cash flows from operating activities for the near-term. These losses could be significant as the Company seeks a merger candidate. The Company will have continuing expenses related to compensation, professional fees, and regulatory.

The Company has incurred significant losses since its inception and has not demonstrated an ability to generate sufficient revenues from the sales of its products and services to achieve profitable operations. There can be no assurance that profitable operations will ever be achieved, or if achieved, could be sustained on a continuing basis. In making this assessment we performed a comprehensive analysis of our current circumstances including: our financial position, our cash flows and cash usage forecasts for the nine months ending November 30, 2020, and our current capital structure including equity-based instruments and our obligations and debts.




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During the nine months ended November 30, 2020, the Company has satisfied its obligations from the issuance of related party notes ($405,000), receipt of related party advances ($42,463) and the sale of common stock to related parties ($50,000); however, there is no assurance that such successful efforts will continue during the twelve months subsequent to the date these condensed consolidated financial statements are issued.

If the Company does not obtain additional capital, the Company will be required to reduce the scope of its business development activities or cease operations. The Company continues to explore obtaining additional capital financing and the Company is closely monitoring its cash balances, cash needs, and expense levels.

These factors create substantial doubt about the Company's ability to continue as a going concern within the twelve-month period subsequent to the date that these consolidated financial statements are issued. The condensed consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Accordingly, the condensed consolidated financial statements have been prepared on a basis that assumes the Company will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

Management's strategic plans include the following:




    •   Pursuing additional capital raising opportunities;
    •   Seeking an acquisition or merger candidate; and
    •   Identifying unique market opportunities that represent potential positive
        short-term cash flow.


Critical Accounting Policies and Estimates

Our financial statements and accompanying notes have been prepared in accordance with GAAP applied on a consistent basis. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

Recently Issued Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

Off-Balance Sheet Arrangements

We have never entered into any off-balance sheet financing arrangements and have not formed any special purpose entities. We have not guaranteed any debt or commitments of other entities or entered into any options on non-financial assets.




Contractual Obligations


We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under this item.

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