Forward-Looking Statements
This Quarterly Report on Form 10-Q (this "Quarterly Report") contains
forward-looking statements. The Securities and Exchange Commission (the "SEC")
encourages companies to disclose forward-looking information so that investors
can better understand a company's future prospects and make informed investment
decisions. This Quarterly Report and other written and oral statements that we
make from time to time contain such forward-looking statements that set out
anticipated results based on management's plans and assumptions regarding future
events or performance. We have tried, wherever possible, to identify such
statements by using words such as
"anticipate,""estimate,""expect,""project,""intend,""plan,""believe,""will" and
similar expressions in connection with any discussion of future operating or
financial performance. In particular, these include statements relating to
future actions, future performance or results of current and anticipated sales
efforts, expenses, the outcome of contingencies, such as legal proceedings, and
financial results.
We caution that the factors described herein, and other factors could cause our
actual results of operations and financial condition to differ materially from
those expressed in any forward-looking statements we make and that investors
should not place undue reliance on any such forward-looking statements. Further,
any forward-looking statement speaks only as of the date on which such statement
is made, and we undertake no obligation to update any forward-looking statement
to reflect events or circumstances after the date on which such statement is
made or to reflect the occurrence of anticipated or unanticipated events or
circumstances. New factors emerge from time to time, and it is not possible for
us to predict all of such factors. Further, we cannot assess the impact of each
such factor on our results of operations or the extent to which any factor, or
combination of factors, may cause actual results to differ materially from those
contained in any forward-looking statements.
General
Business Overview
GiveMePower Corporation operates and manages a portfolio of real estate and
financial services assets and operations to empower black persons in the United
States through financial tools and resources. Givemepower is primarily focused
on: (1) creating and empowering local black businesses in urban America; and (2)
creating real estate properties and businesses in opportunity zones and other
distressed neighborhood across America. This Offering represents the
commencement of the Banking and financial services division of our business.
This Offering will enable GMPW to become a financial technology company (FINTEC)
business that (1) one-to-four branch federally licensed bank in each
jurisdiction, (2) a machine learning (ML) and artificial intelligence (AI)
enabled loan and insurance underwriting platform, (3) blockchain-powered
transaction processing and payment systems, (4) cryptocurrency transaction
processing platform, and (5) emerging cryptocurrency opportunities portfolio;
giving access to the unbanked, underserved residents of majorly black
communities across the United State. This is the fulfilment of mission of
operating and managing a portfolio of real estate and financial services assets
and operations to empower black persons in the United States through financial
tools and resources, with a primary focused on: (1) creating and empowering
local black businesses in urban America; and (2) creating real estate properties
and businesses in opportunity zones and other distressed neighborhood across
America. Our FINTEC operations would cover the basic areas of traditional
banking-digitally enhance, ML and Ai enabled lending and insurance underwriting,
areas of private equity, business lending and venture capital that invest in
young black entrepreneurs, and seeding their viable business plans/ideas on
block-chain-powered financial services delivery platform that connects, black
entrepreneurs, black borrowers, consumers, banks, and institutional investors.
Our real estate division invests in Opportunity Zones, Affordable Housing, and
specialized real estate properties.
Business History
GiveMePower Corporation (the "PubCo" or "Company"), a Nevada corporation, was
incorporated on June 7, 2001 to sell software geared to end users and developers
involved in the design, manufacture, and construction of engineered products
located in Canada and the United States. GiveMePower was originally incorporated
in Alberta, Canada as GiveMePower.com Inc. on April 18, 2000, to sell software
and web-based services geared to businesses involved in the design, manufacture,
and construction of engineered products throughout North America. Effective
September 15, 2000, the Company amended its Articles of Incorporation to change
its corporate name to GiveMePower Inc. The founder of the Company began the
implementation of this business plan under his 100%-owned private company,
Sundance Marketing International Inc. (Sundance). Sundance has been in existence
since 1991 and at one time was a market leader in the distribution of survey,
mapping and infrastructure design software in the Canadian marketplace. On April
15, 1999, Mr. Walton entered into a license agreement with Felix Computer Aided
Technologies GmbH (Felix) for the exclusive rights to distribute FCAD software
in North America.
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On December 20, 2000, the Company entered into a Plan and Agreement of
Reorganization to undertake a reverse merger with a National Quotation Bureau
public company called TelNet World Communications, Inc. (TelNet). TelNet was
originally incorporated in the State of Utah on March 10, 1972 as Tropic
Industries, Inc. (Tropic). Tropic became United Datacopy, Incorporated on
February 24, 1987 which became Pen International, Inc. on March 21, 1994 and
then TelNet World Communications, Inc. on March 4, 1998. TelNet had no
operations nor any working capital when the Company entered into the reverse
merger with it. GMP acquired the rights, title and interest to the domain name,
givemepower.com from Sundance on February 16, 2001. In addition, Sundance agreed
to assign its existing customer base to GMP and further agreed that it would
terminate its license agreement with Felix immediately upon GMP securing its own
agreement with Felix. GMP renegotiated the exclusive rights to co-develop,
re-brand and distribute FCAD software in North America effective February 16,
2001. Effective July 5, 2001 the Company changed the name of TelNet to
GiveMePower Corporation and changed the domicile from Utah to Nevada.
The PubCo has been dormant and non-operating since year 2009. PubCo is a public
reporting company registered with the Securities Exchange Commissioner ("SEC").
In November 2009, the Company filed Form 15D, Suspension of Duty to Report, and
as a result, the Company was not required to file any SEC forms since November
2009. On May 11, 2020, the Company filed a Form 10-12G to register its common
stock with the SEC and restarted making required filings.
On December 31, 2019, PubCo sold one Special 2019 series A preferred share
("Series A Share") for $38,000 to Goldstein Franklin, Inc. ("Goldstein"), a
California corporation. One Series A Share is convertible to 100,000,000 shares
of common stocks at any time. The Series A Share also provided with 60% voting
rights of the PubCo. On the same day, Goldstein sold one-member unit of
Alpharidge Capital, LLC ("Alpharidge"), a California limited liability
corporation, representing 100% member owner of Alpharidge. As a result,
Alpharidge become a wholly owned subsidiary of PubCo as of December 31, 2019.
The Company's operating structure did not change as a result of the change of
control, however, following the transaction on December 31, 2019, in which
Goldstein Franklin, Inc. acquired control of the Company, Goldstein transferred
one of its operating subsidiaries, Alpharidge Capital LLC into GMPW to become
one of the Company's operating subsidiaries. As the result of above transaction,
Alpharidge Capital LLC became the Company's wholly owned operating subsidiary of
the Company.
Alpharidge Capital LLC ("Alpharidge") was formed under the laws of the State of
California on August 30, 2019. Alpharidge has two distinct lines of businesses
that comprise: (1) a specialty biopharmaceutical holding company focused on
building portfolio of real estate investment properties and equity positions in
select companies within select industries; and (2) an event-driven investment
management operation that invests in equities, warrants, bonds and options of
public and private companies in America and across the globe.
On September 16, 2020, as part of its sales of unregistered securities to Kid
Castle Educational Corporation, company related to, and controlled by GMPW
President and CEO, the Company, for $3 in cash and 1,000,000 shares of its
preferred stock, acquired 100% interest in, and control of Community Economic
Development Capital, LLC ("CED Capital"), a California Limited Liability
Company, and 97% of the issued and outstanding shares of Cannabinoid
Biosciences, Inc. ("CBDX"), a California corporation. This transaction was
accounted for under the Consolidation Method using the variable interest entity
(VIE) model wherein the Company consolidates all investees operating results if
the Company expects to assume more than 50% of another entity's expected losses
or gains. The 1,000,000 shares of our preferred stock sold to Kid Castle
Educational Corporation gave to Kid Castle, approximately 87% voting control of
Givemepower Corporation.
On April 21, 2021, the Company sold Cannabinoid Biosciences, Inc. ("CBDX"), a
California corporation, to Premier Information Management, Inc. for $1 in cash.
As further consideration pursuant to the stated sales, CBDX returned Kid Castle
Educational Inc., the parent Company of GMPW, the 100,000 shares of KDCE
preferred stock and 900,000,000 shares of KDCE common stock that CBDX bought in
October of 2019. Pursuant to the April 21, 2021 transaction, CBDX ceased from
being a subsidiary of GMPW, effective April 1, 2021.
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The consolidated financial statements of the Company therefore include its
wholly owned subsidiaries of Alpharidge Capital LLC. ("Alpharidge"), Community
Economic Development Capital, LLC. ("CED Capital"), and subsidiaries, in which
GiveMePower has a controlling voting interest and entities consolidated under
the variable interest entities ("VIE") provisions of ASC 810, "Consolidation"
("ASC 810"), after elimination of intercompany transactions and accounts.
Most Recent Addition to Our Business and Organization
Crypto Currency Mining Operation
During the period between March 3 to March 16 2021, the Company tried
unsuccessfully, to acquire Bitcentro/Buzzmehome's CryptoCurrency mining
operations in Canada for $500,000 in cash. The deal fell through because of
misunderstanding between parties as to the timing and duration of due diligence
period.
After the failed acquisition attempt, the Company contracted with Brady
Fernandes, a Los Angeles resident who claimed expertise in the crypto mining
industry. The Company contracted with Brady for $9,200 to commence the project
of helping the company to build out its own in-house cryptocurrency mining farm.
Brady has commenced building our first rig and has also ordered the necessary
equipment to add rigs to our crypto currency mining farm. On April 28, 2021, the
Company paid additional $10,000 to Mr. Fernandez for ordering additional
equipment for building out it crypto currency mining farm.
We have dedicated a line-item, "Crypto Currency Mining Rigs," on our balance to
track all our investments in the Crypto Currency Mining Operation. We plan to
build out a fully operating farm in California, using solar energy to mitigate
the high cost of energy in California.
Current Business and Organization - Alpharidge
The Company, through its three wholly owned subsidiaries, Alpharidge Capital,
LLC ("Alpharidge"), Malcom Wingate Cush Franklin LLC ("MWCF"), and Opportunity
Zone Capital LLC ("OZC"), seeks to empower black persons in the United States
through financial tools and resources as follows:
? Alpharidge and OZC Real estate operations - Real estate operations would
consist primarily of rental real estate, affordable housing projects,
opportunity zones, other property development and associated HOA activities.
OZC development operations would be primarily through a real estate
investment, management and development subsidiary that focuses primarily on
the construction and sale of single-family and multi-family homes, lots in
subdivisions and planned communities, and raw land for residential
development; and
? MWCF financial empowerment - MWCF would utilize operate the tools of financial
education/training, mergers and acquisitions, private equity and business
lending to invest and empower young black entrepreneurs, seeding their viable
business plans and ideas and creating jobs in their communities. MWCF is
primarily focused on: (1) creating and empowering local black businesses in
urban America; and (2) creating real estate in opportunity zones and other
distressed neighbourhood across America.
? Cash Management, Opportunistic and Event-Driven Investments: The Company keeps
no more than 10% of its total assets in liquid cash or investments portfolio,
which is actively managed by its directors and officers and invest primarily
in equity investments on a long and short basis. The Company's cash management
policy which requires that the Company actively invests its excess cash into
stocks, bonds and other securities is intended to provide the company greater
levels of liquidity and current income. The Company uses proprietary trading
models to capitalize on real-time market anomalies and generate ongoing income
in the forms similar to hedge funds. Where necessary, the Company uses seeded
entities to pursue real-time market transactions in publicly traded securities
including but not limited to stocks, bonds, options, futures, forex, warrants,
and other instruments.
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Alpharidge's Entrepreneurship Development Initiative
In April of 2021, Alpharidge launched its Entrepreneurship Development
Initiative which entails: (1) Portfolio - acquiring OTC trading shells with stop
signs and cleaning them up to become Pink Current, then merging them with
emerging businesses controlled by Alpharidge-trained entrepreneurs; and (2)
Custodianship - use the custodianship process in Nevada and Delaware to acquire
custodianship of abandoned OTC-trading shells, clean them up to become Pink
Current, then merging them with emerging businesses controlled by
Alpharidge-trained entrepreneurs.
On April 22, 2021, Alpharidge retained a Nevada based Attorney to petition for
custodianship of Mondial Ventures, Inc. Alpharidge later lost the attempt and
expensed all related cost as Professional fees - legal. On May 5, 2021,
Alpharidge purchase from the open market, Labwire, Inc., (LBWR) and Waypoint
Biomedical, Inc., both of which it has brought Pink Current. As at the date of
this reports, Alpharidge' Entrepreneurship Development Initiative Portfolio has
bought also purchase Nano Mobile Healthcare, Inc. to make it 3 shells. The
Custodianship has petitioned for MNVN, HMLA, TONR, ECMH, ABWN, FPMI, NTGL, CGUD,
ICOA, SRBT, USWF, NWTT, USBC, WRMA, WWRL, HERF, NRCD, TGMR, ITRX, AFFN, UTDE,
AOBI, SRCX, ADCV, DVFI, APWL, CIVX, NHLG, ILIM, CCWF, TMXN, MNDP, JPEX, SVLT,
MTEI, CAMG, CDBT, ERGO, NOUV, ICNM, PRDL, OCLG, ILST and FCGD, altogether 44
petitions filed within 8 weeks. Of the 44, Alpharidge lost, walked-away, or
withdrew from 9 petitions." Cost related to the successful petitions were
capitalized on the Company's balance sheet as "Entrepreneurship Development" and
those related to failed petitions were expensed in the period incurred as
"Professional Fees - legal."
Alpharidge Capital LLC anticipates its Entrepreneurship Development to be an
ongoing business. It expects to generate income and expense cost related to this
line of business.
Current Business and Organization - CED Capital
Community Economic Development Capital, LLC. ("CED Capital"), a California
limited liability company, is a specialty real estate holding company for
specialized assets including, affordable housing, opportunity zones properties,
industrial and commercial real estate, and other real estate related services.
CED Capital principal business objective is to maximize returns through a
combination of (1) generating good profit while making substantial social
impact, (2) sustainable long-term growth in cash flows from increased rents, and
(3) potential long-term appreciation in the value of its properties from capital
gains upon future sale. The Company is engaged primarily in the ownership,
operation, management, acquisition, development and redevelopment of
predominantly multifamily housing and specialized industrial properties in the
United States. Additionally, its specialized industrial property strategy is to
acquire and own a portfolio of specialized industrial properties, including
multifamily properties. This strategy includes the following components:
[ ] Owning Specialized Real Estate Properties and Assets for Income. The Company
intends to acquire multifamily housings, economic development real estates
and multifamily properties. The Company expects to hold acquired properties
for investment and to generate stable and increasing rental income from
leasing these properties to licensed growers.
[ ] Owning Specialized Real Estate Properties and Assets for Appreciation. The
Company intends to lease its acquired properties under long-term, triple-net
leases. However, from time to time, the Company may elect to sell one or
more properties if the Company believes it to be in the best interests of
its stockholders. Accordingly, the Company will seek to acquire properties
that it believes also have potential for long-term appreciation in value.
[ ] Affordable Housing. Its motto is: "acquiring distressed/troubled properties,
securing generous government subsidies, empowering low-income families, and
generating above-market returns to investors."
[ ] Preserving Financial Flexibility on the Company's Balance Sheet. The Company
intends to focus on maintaining a conservative capital structure, in order
to provide us flexibility in financing its growth initiatives.
BlackBank, Blockchain-Powered Fintech, Ai and ML Enabled Lending, and
CryptoCurrency Deals
The Company intends to actualize its banking and financial services operations
goals through acquisition and management of (1) a one-to-four branch bank that
is federally licensed in each jurisdiction; (2) a machine learning (ML) and
artificial intelligence (Ai) enabled loan and insurance underwriting platform;
(3) blockchain-powered transaction processing and payment systems; (4)
cryptocurrency transaction processing platform; and (5) emerging cryptocurrency
opportunities portfolio; a combination of three of which would connects
consumers, banks, institutional investors, and ensure access to the unbanked and
underserved residents of majorly black communities across the United State of
America.
(1) BlackBank - Proposed Federally licensed one-four branch bank
Jurisdictionally, GMPW intend to acquire and manage one-four branch bank in each
of its relevant jurisdictional domain. Owning/controlling a bank or banks with
branches across every urban/black neighborhood in the United States is not our
goal. Rather we would be content to own a one-four branch bank in every relevant
jurisdiction to allow us to initiate/conduct ML-Ai enabled and
blockchain-powered digitized banking that is accessible to all black person and
businesses across the United States. We intend to start our banking acquisition
by finding targets that operates one-four branches. We intend to start with the
acquisition of one-four branch bank, whose operation and back-office would be
migrated unto a Blockchain-powered platform to digitize its entire banking
operation to cover and serve all black persons in the United States. We believe
that blockchain technology is one of the most suited platform to implement, run
and manage a U.S. wide digitized banking services whose reach encompasses most
black persons living in the United States.
(2) Machine-Learning and Ai (AI) Enabled Lending and Insurance Underwriting
Platform
Once it has raised sufficient capital (proposed $10 million offering), the
Company intends to launch the Company's cloud-based machine learning and
artificial intelligence lending platform. It is our believe that
Machine-Learning (ML) and Artificial intelligence (AI), lending and insurance
underwriting platform would enable a superior loan product with improved
economics that can be shared between consumers and lenders. The proposed
platform would aggregate consumer demand for high-quality loans and connects it
to our soon-to-be-build network of ML-AI-enabled investors, lenders and bank
partners. Consumers on the ML-AI platform would benefit from a highly automated,
efficient, all-digital experience. Our prospective bank partners would benefit
from access to new customers, lower fraud and loss rates, and increased
automation throughout the lending process.
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Credit is a cornerstone of the U.S. economy, and access to affordable credit is
central to unlocking upward mobility and opportunity. The FICO score was
invented in 1989 and remains the standard for determining who is approved for
credit and at what interest rate. (Rob Kaufman, myFico Blog: The History of the
FICO Score, August 2018). While FICO is rarely the only input in a lending
decision, most banks use simple, rules-based systems that consider only a
limited number of variables. Unfortunately, because legacy credit systems fail
to properly identify and quantify risk, millions of creditworthy individuals are
left out of the system, and millions more pay too much to borrow money. (Patrice
Ficklin and Paul Watkins, Consumer Financial Protection Bureau Blog: An Update
on Credit Access and the Bureau's First No-Action Letter, August 2019).
The first generation of online lenders focused on bringing credit online.
Analogous to earlier internet pioneers, these companies made shopping for and
accessing credit simpler and easier for consumers and businesses. It was no
longer necessary to stand in line at a bank branch, to sit across the desk from
a loan officer and to wait weeks or months for a decision. These lenders enabled
the emergence of personal loan products that were previously unprofitable for
banks to offer. While they brought the credit process online, they inherited the
decision frameworks that banks had used for decades and did not address the more
rewarding and challenging opportunity of reinventing the credit decision.
GMPW intend to leverage the power of AI to more accurately quantify the true
risk of a loan. The ML- AI models would be built to continuously self-upgrade,
train and refine many critical components of lending risk analytics and
decision-making on a real-time basis. We intend to build discrete ML- AI models
that target fee optimization, income fraud, acquisition targeting, loan
stacking, prepayment prediction, identity fraud and time-delimited default
prediction. These models would be designed to incorporate multiple lending
underwriting variables and utilize training dataset that accounts for varieties
of repayment events. It is also anticipated that the network effects generated
by constantly improving ML- AI models would provide a significant competitive
advantage-and more training data would lead to higher approval rates and lower
interest rates at the same loss rate
(3) Blockchain-Powered Digital Currency Payment and Financial Transactions
Processing platform ("Blackchain")
The Company intends to acquire an existing, or build-from-the-scratch, a
Blockchain-Powered Digital Currency Payment and Financial Transactions
Processing platform ("Blackchain"), with home in the BlackBank alongside the
ML-AI lending platform. Blockchain-powered Payment and Financial Transactions
Processing platform would also provide efficient and inexpensive payment
platform and merchant services to black businesses across the United States.
The company would establish an exchange network called Blackchain Exchange
Network ("BEN"), a Payment and Financial Transactions Processing platform, would
be a wholly-owned subsidiary, the BlackBank. We believe Blackchain would be a
leading provider of innovative financial infrastructure solutions and services
to participants in the nascent and expanding digital currency industry.
Blackchain business strategy is floating a Blackchain Exchange Network, or BEN,
a virtually instantaneous payment network for participants in the digital
currency industry which would serve as a platform for the development of
additional products and services. The BEN would have a network effect that would
make it valuable as participants and utilization increase, leading to good
growth in BEN transaction volumes. The BEN would enable the BlackBank to
prioritize, build and significantly grow noninterest bearing deposit product for
digital currency industry participants, which is expected to provide the
majority of our bank funding in the next two years from finalizing acquisition.
This unique source of funding would be a distinctive advantage over most
traditional financial institutions and allows BlackBank to generate revenue from
a conservative portfolio of investments in cash, short term securities and ML-Ai
enabled loans that we believe generate attractive risk-adjusted returns. In
addition, use of the BEN would result in an increase in noninterest income that
we believe will become a valuable source of additional future revenue as we
develop and deploy blockchain-powered, fee-based solutions in connection with
our digital currency initiative. We would also evaluate additional products or
product enhancements specifically targeted at providing further financial
infrastructure solutions to our customers and strengthening BEN network effects.
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Blackchain Business Overview
Once acquired, the Federally licensed one-four branch bank would be such that is
already providing banking and financial services including commercial banking,
business lending, commercial and residential real estate lending and mortgage
warehouse lending, all funded primarily by interest bearing deposits and
borrowings. To that up and running banking and financial services operation, we
intend to insert a Blockchain-powered payment and transaction processing system
and digital currency platform. We intend to pursue digital currency customers
and bring them into the BlackBank to bank with us using digital currency. We
believe we could effectively leverage the traditional commercial bank platform,
the ML-Ai enabled lending platform and the attributes of the BEN to gain
traction in the digital currency banking industry.
We intend to focus on the digital currency initiative as the core of our future
strategy and direction. We intend to build a leadership position in the digital
currency industry as a result of the BEN to enable us to establish a significant
balance of noninterest bearing deposits from digital currency customer base.
Over several post-acquisition years, BlackBank would have transitioned from a
traditional asset based bank model focused on loan generation to a deposit and
solutions based model focused on increasing noninterest bearing deposits and
noninterest income. This emphasis on noninterest bearing deposits and
noninterest income, is primarily associated with digital currency, will likely
result in a significant shift in BlackBank's asset composition with a greater
percentage consisting of liquid assets such as interest earning deposits in
other banks and investment securities, and a corresponding decrease in the
percentage of loans. Most of our actions would be focused on developing and
delivering highly scalable and operationally efficient solutions for BlackBank's
digital currency customers.
(4) Emerging Cryptocurrency Opportunities Portfolio
The emerging cryptocurrency opportunities portfolio is the wildcard of our
FINTEC business model. While the goals are clear, because it is a wildcard,
there is no outline on what to expect or how it should be run. GMPW needs these
flexibilities because many established companies are jumping into the
crypocurrency opportunities on a minutes notice. For example, in 2020,
Microstrategy decided to move their treasury into bitcoin as part of their cash
management strategy. Marathon Patent Group moved into cryptocurrency mining as a
business model. Overstock has been in cryptocurrency for a while. Square and
Paypal just joined the bandwagon of American companies that try to find and
exploit opportunities in the crypto currency industry without abandoning their
actual businesses. GMPW's emerging cryptocurrency opportunities portfolio would
not be different. The company would on an ongoing basis evaluate and consider
investments into potentially viable cryptocurrency opportunities anywhere.
Black-Bank Recitations
The Black-Bank is a financial institution that creates, aggregates, facilitates,
builds, grows, promotes, preserves and redistributes wealth to black persons.
The Black-Bank was founded on 13th day of June, 2014, when certain of the
descendants of Cush, the eldest son of Ham, a son of Noah, resolved to establish
a bank, a financial services company to: (1) cater to black persons' banking
needs, (2) finance projects that primarily benefit black persons, (3) capitalize
viable ideas by black persons, (4) fund wealth creation and community economic
development visions of black persons, (5) invest in black entrepreneurs, and (6)
empower black men and women across the earth to pursue worthy dreams and build
great communities. The premier Black-Bank shall be headquartered in the United
States of America, the land of the free and home to the brave; a land where
providence had strategically place many of the best of the descendants of Cush.
The bank will transact and promote activities across the earth to-and-fro beyond
the rivers of Cush (Zephaniah. 3:10 (NIV)). The purpose of the establishment of
this entity is to promote and carter to the financial and economic interest of
black people, therefore, it shall be called or referred to as the Black Bank
(Jeremiah 13:23). The Black Bank will harvest and finance the implementation of
the bests of the ideas and visions of the forebears from Cush to Simon of
Cyrene, Marcus Garvey, Booker T. Washington, W.E.B Dubois, Rev. Martin Luther
King Jr., Patrice Lumumba, Thomas Sankara, Toussaint Louverture and Steve Biko
for the prosperity and wellbeing of black persons across the face of the earth."
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Competition
Our business is highly competitive. We are in direct competition with more
established private equity firms, private investors and management companies.
Many management companies offer similar products and services for business
rollups and consolidations. We may be at a substantial disadvantage to our
competitors who have more capital than we do to carry out acquisition,
operations and restructuring efforts. These competitors may have competitive
advantages, such as greater name recognition, larger capital-base, marketing,
research and acquisition resources, access to larger customer bases and channel
partners, a longer operating history and lower labor and development costs,
which may enable them to respond more quickly to new or emerging opportunities
and changes in customer requirements or devote greater resources to the
development, acquisition and promotion.
Increased competition could result in us failing to attract significant capital
or maintaining them. If we are unable to compete successfully against current
and future competitors, our business and financial condition may be harmed.
We hope to maintain our competitive advantage by keeping abreast of market
dynamism that is face by our industry, and by utilizing the experience,
knowledge, and expertise of our management team. Moreover, we believe that we
distinguish ourselves in the ways our model envisaged transformation of
businesses.
Government Regulation
Our activities currently are subject to no particular regulation by governmental
agencies other than that routinely imposed on corporate businesses. However, we
may be subject to the rules governing acquisition and disposition of businesses,
real estates and personal properties in each of the state where we have our
operations. We may also be subject to various state laws designed to protect
buyers and sellers of businesses. We cannot predict the impact of future
regulations on either us or our business model.
Intellectual Property
We currently have no patents, trademarks or other registered intellectual
property. We do not consider the grant of patents, trademarks or other
registered intellectual property essential to the success of our business.
Employees
We do not have a W-2 employee at the present. The bulk of the administration of
our operating activities is shouldered by Goldstein Franklin, a California
public accounting firm and our controlling shareholder. Frank Ikechukwu
Igwealor, our President, Chief Executive Officer and Chief Financial Officer, is
our only full-time staff as of June 30, 2021, pending when we could formalize an
employment contract for him. In addition to Mr. Igwealor, we have three
part-time unpaid staff who helps with bookkeeping and administrative chores.
Most of our part-time staff, officers, and directors will devote their time as
needed to our business and are expect to devote at least 15 hours per week to
our business operations. We plan on formalizing employment contract for those
staff currently helping us without pay. Furthermore, in the immediate future, we
intend to use independent contractors and consultants to assist in many aspects
of our business on an as needed basis pending financial resources being
available. We may use independent contractors and consultants once we receive
sufficient funding to hire additional employees. Even then, we will principally
rely on independent contractors for substantially all of our technical and
marketing needs.
The Company has no written employment contract or agreement with any person.
Currently, we are not actively seeking additional employees or engaging any
consultants through a formal written agreement or contract. Services are
provided on an as-needed basis to date. This may change in the event that we are
able to secure financing through equity or loans to the Company. As our company
grows, we expect to hire more full-time employees.
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Results of Operations
Three and Six Months ended June 30, 2021, as Compared to Three and Six Months
Ended June 30, 2021, 2020
Revenues - The Company recorded $3,376,528 and $4,042,194 in revenue for the
three and six months ended June 30, 2021 as compared to $24,821 and $60,007 for
the same period of June 30, 2020.
Operating Expenses - Total operating expenses for the three and six months ended
June 30, 2021, was $77,645 and $133,123 as compared to $5,313 and $10,515 in the
same period of June 30, 2020, due to increased operating activities during the
period ended June 30, 2021.
Net Income - Net income for three and six months ended June 30, 2021 was
$416,494 and $866,764 as compared to Net Income of $15,106 and Net Loss of
$18,326 for the three and six months ended June 30, 2020. Gross income from
operation includes unrealized gain of $(218,425) and $24,821 for the three and
six months ended June 30, 2021.
OCI - Unrealized Gain or Other Comprehensive Income for three and six months
ended June 30, 2021, was of $712,532 and $759,999, as compared to Unrealized
Loss of $(4,402) and $(67,818) for the three six months ended June 30, 2020. The
other comprehensive income of $712,532 and $756,999 were a result of
mark-to-market/fair value adjustment to Trading Securities for the period.
Financial Condition, Liquidity and Capital Resources
As of June 30, 2021, the Company had a working capital of $1,037,406, consisting
of $62,272 in cash, $2,227,539 in Trading Securities, and $1,252,405 in
short-term loan.
For the six months period ended June 30, 2021, the Company used cash of $54,693
on operating activities, generated cash of $345,816 on investing activities, and
used cash of $230,481 on financing activities, resulting in an increase in total
cash of $60,642 and a cash balance of $62,272 for the period. For the six months
period ended June 30, 2020, the Company used cash of $20,320 in operating
activities, used cash of $321,498 on investing activities and generated cash of
$341,335 from financing activities, resulting in a decrease in cash of $483 and
a cash balance of $17 at the end of that period due to discontinuation of
business line.
As of June 30, 2021, total Notes Payable to related parties decreased by $84,100
from the fiscal year ended December 31, 2020.
As of June 30, 2021, total stockholders' equity increased to $899,277 from
$3,141 as of December 31, 2020. The increase in stockholders' equity was largely
due to discontinuation of business line (CBDX).
As of June 30, 2021, the Company had a cash balance of $62,272 (i.e. cash is
used to fund operations). The Company does believe our current cash balances
will be sufficient to allow us to fund our operating plan for the next twelve
months. However, our ability to continue as a going concern is still dependent
on us obtaining adequate capital to fund operation or maintaining consecutive
quarterly profitability. If we are unable to obtain adequate capital, or
maintaining consecutive quarterly profitability, we could be forced to cease
operations or substantially curtail its drug development activities. These
conditions could raise substantial doubt as to our ability to continue as a
going concern. The accompanying financial statements do not include any
adjustments relating to the recoverability and classification of recorded asset
amounts and classification of liabilities should we be unable to continue as a
going concern.
Our principal sources of liquidity are: (1) Crypto Currency Mining, (2) Real
Estate Sales, and (3) Trading Securities. In the past, we have been generating
cash from loans to us by our major shareholder. In order to be able to achieve
our strategic goals, we need to further expand our business and implement our
business plan. To continue to develop our business plan and generate sales,
significant capital has been and will continue to be required. Management
intends to fund future operations through private or public equity and/or debt
offerings. We continue to engage in preliminary discussions with potential
investors and broker-dealers, but no terms have been agreed upon. There can be
no assurances, however, that additional funding will be available on terms
acceptable to us, or at all. Any equity financing may be dilutive to existing
shareholders. We do not currently have any contractual restrictions on our
ability to incur debt and, accordingly we could incur significant amounts of
indebtedness to finance operations. Any such indebtedness could contain
covenants which would restrict our operations.
Off-Balance Sheet Arrangements
There are no 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 investors.
42
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America ("U.S. GAAP") requires
estimates and assumptions that affect the reported amounts of assets and
liabilities, revenues and expenses, and related disclosures of contingent assets
and liabilities in the consolidated financial statements and accompanying notes.
The SEC has defined a company's critical accounting policies as the ones that
are most important to the portrayal of the company's financial condition and
results of operations, and which require the company to make its most difficult
and subjective judgments, often as a result of the need to make estimates of
matters that are inherently uncertain.
Based on this definition, we have identified the critical accounting policies
and judgments addressed which are described in Note 2 to our condensed
consolidated financial statements included elsewhere in this Quarterly Report.
Although we believe that our estimates, assumptions and judgments are
reasonable, they are based upon information presently available. Actual results
may differ significantly from these estimates under different assumptions,
judgments or conditions.
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