PETRO USA, INC. Item 1.01. Entry into a Material Definitive Agreement.
OnFebruary 15, 2023 , the Registrant entered into a Stock Exchange Agreement with the shareholders ofVeritaz Trading and Exim Private Limited , a company incorporated inIndia and registered under the Companies Act, 1956 having its registered office atS-61 Panscheel Park ,New Delhi 110019 (hereinafter "Veritaz"). Under said Stock Exchange Agreement, the Registrant will acquired all of Veitaz 10,000 Ordinary Shares outstanding for 2,000,000 shares of the Registrant. As a result of said Agreement, Veritaz will became a wholly owned subsidiary of the Registrant. Veritaz is a company focused towards marketing technical and performance textiles in the Indian market and has bagged Indian market representations from pioneer technical textile & Field Medical Products and equipment's. Further, Veritaz has also developed exclusive relationships in technical textile range to Indian armed forces, Paramilitary, MHA, B2B & B2C segments of the open Indian Market. 5
Item 2.01. Completion of Acquisition or Disposition of Assets.
OnApril 14, 2023 , the Registrant completed the acquisition of Veritaz. Under said Stock Exchange Agreement, the Registrant acquired all of Veritaz 10,000 Ordinary Shares outstanding for 2,000,000 shares of the Registrant. As a result, Veritaz became a wholly owned subsidiary of the Registrant. Description of Business OnApril 19, 2023 , the Company acquiredVeritz Trading and Axim Private Limited in a stock for stock trade.Veritaz Trading and Exim Private Limited was incorporated inIndia and registered under the Companies Act, 1956 having its registered office atS-61 Panscheel Park ,New Delhi -110019. Veritaz is a company focused towards marketing technical and performance textiles in the Indian market and has bagged Indian market representations from pioneer technical textile & Field Medical Products and equipment's. Further, Veritaz has also developed exclusive relationships in technical textile range to Indian armed forces, Paramilitary, MHA, B2B & B2C segments of the open Indian Market. RISK FACTORS
An investment in our securities involves a high degree of risk. You should not invest in our securities if you cannot afford to lose your entire investment. In deciding whether you should invest in our securities, you should carefully consider the following information together with all of the other information contained in this Current Report. Any of the following risk factors can cause our business, prospects, financial condition or results of operations to suffer and you to lose all or part of your investment.
General Risks Relating to our Business, Operations of Financial Condition
We have a limited operating history and are subject to the risks encountered by early-stage companies.
Veritaz Trading and Exim Private Limited was incorporated inIndia and registered under the Companies Act, 1956 having its registered office atS-61 Panscheel Park ,New Delhi -110019. Because our operating company has a limited operating history, you should consider and evaluate our operating prospects in light of the risks and uncertainties frequently encountered by early-stage companies in rapidly evolving markets. For us, these risks include:
· risks that we may not have sufficient capital to achieve our growth strategy;
· risks that we may not develop our product and service offerings in a manner that enables us to be profitable and meet our customers' requirements;
· risks that our growth strategy may not be successful; and
· risks that fluctuations in our operating results will be significant relative to our revenues.
These risks are described in more detail below. Our future growth will depend substantially on our ability to address these and the other risks described in this section. If we do not successfully address these risks, our business would be significantly harmed.
We have a history of net losses, may incur substantial net losses in the future and may not achieve profitability.
Although we have begun to generate revenues, we have incurred significant losses since inception. We expect to incur increased costs to implement our business plan and increase revenues, such as costs relating to expanding our crowd funding platform into additional country markets. If our revenues do not increase to offset these additional expenses or if we experience unexpected increases in operating expenses, we will continue to incur significant losses and will not become profitable. If we are not able to significantly increase our revenues, we will likely not be able to achieve profitability in the future.
Our operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern. If we do not continue as a going concern, investors could lose their entire investment.
Our operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern. If we do not generate revenues, do not achieve profitability and do not have other sources of financing for our business, we may have to curtail or cease our development plans and operations, which could cause investors to lose the entire amount of their investment.
If we are unable to manage our anticipated post-Share Exchange growth effectively, our business could be adversely affected.
We anticipate that a significant expansion of our operations and addition of operating subsidiaries, including one inthe United States , and new personnel will be required in all areas of our operations in order to implement our post-Share Exchange business plan. Our future operating results depend to a large extent on our ability to manage this expansion and growth successfully. For us to continue to manage such growth, we must put in place legal and accounting systems, and implement human resource management and other tools. We have taken preliminary steps to put this structure in place. However, there is no assurance that we will be able to successfully manage this anticipated rapid growth. A failure to manage our growth effectively could materially and adversely affect our ability to market our crowd funding platform in multiple venues.
The regulations in
Other than theIndia regulatory framework, there are currently are no laws or regulations that specifically govern US public companies operating inIndia or that require us to register with or seek permission from TheIndia regulatory agency. Changes in local regulations withinIndia relating to future offering of securities to the public, could negatively affect our operations inIndia . Such changes could result in our having to change our business model, which could negatively impact future revenues. Further, there are various regulators inIndia that monitor and regulate financial markets and supervise financial service providers involved in the sale of investments and securities. These regulators monitor financial activities and could determine that specific laws and regulations that apply to the financial sector. Such a determination could negatively affect our operations inIndia and impact our ability to operate our business and generate revenues. Additionally, the implementation of new regulations or the application of existing laws and regulations in other countries where Veritaz may wish to begin operations could have a negative impact on our future growth plans. 6
Changes in regulations within
Changes in local regulations withinIndia relating to the offering of securities to the public could negatively affect the business operations of Veritaz withinIndia . Such changes could result in the Company having to change its business model, which could negatively impact future revenues.
Inappropriate business behavior of entrepreneurs raising funds via our platforms could result in reputational or financial damages to our business.
Although Veritaz business is limited to providing a platform for matching investors and entrepreneurs, there is a possibility that inappropriate business behavior exhibited by any of the entrepreneurs raising capital through our platform could result in reputational or financial damages to us. We enforce a thorough due diligence process for all companies raising funds via our products and we require participating entrepreneurs to sign legally binding terms of use releasing Veritaz from any responsibility for entrepreneur impropriety or misdeed. Nevertheless, our clients might regard Veritaz as being responsible for any impropriator behavior of the entrepreneur and this could result in reputation damage to us that could impact our future revenues.
Increasing competition within our emerging industry could have an impact on our business prospects.
Our products sold to the Indian military is an emerging industry where new competitors are entering the market frequently. These competing companies may have significantly greater financial and other resources than we have and may have been developing their products and services longer than we have been developing ours. Although our portfolio of products and related revenue stream sources are broad, increasing competition may have a negative impact on our profit margins.
Our business is subject to risks generally associated with fluctuating economic tendencies in the capital markets.
The demand for our products can change over time due to fluctuations in the global and local economies and in the related capital requirements of small and medium-sized enterprises. These fluctuations could negatively impact our future revenue streams.
Fluctuations in interest rates could impair the ability of companies to raise capital on the Veritaz platform.
Fluctuations in interest rates could influence the attractiveness for investors to allocate capital to small and medium-sized enterprises raising capital on our financial platform. This could result in reduced revenues to us.
If we lose the services of our founders or other members of our senior . . .
Item 5.06 Change in Shell Company Status.
Prior to the Share Exchange, we were a "shell company" (as such term is defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the "Exchange Act")). As a result of the Share Exchange, we have ceased to be a shell company. The information contained in this Current Report constitutes the current "Form 10 information" necessary to satisfy the conditions contained in Rule 144(i)(2) under the Securities Act of 1933, as amended (the "Securities Act").
Item 9.01 Financial Statements and Exhibits.
(a) Financial statements of business acquired. In accordance with Item 9.01(a),Petro USA, Inc.'s audited financial statements as of and for the years endedJune 30, 2022 andJune 30, 2021 , unaudited financial statements for the three and six months endedDecember 31, 2022 andDecember 31 , 2921,.are included in this Report beginning on Page F-1. (b) Pro forma financial information. In accordance with Item 9.01(b), audited financial statements of Veritaz Trading and Exim Private /limited as ofMarch 31, 2022 andMarch 31, 2021 and unaudited financial statements for the nine months ending as ofDecember 31, 2022 andDecember 31, 2021 and the accompanying notes are included in this Report beginning on Page F-34. (d) Exhibits In reviewing the agreements included or incorporated by reference as exhibits to this Current Report on Form 8-K, please remember that they are included to provide you with information regarding their terms and are not intended to provide any other factual or disclosure information about the Company or the other parties to the agreements. The agreements may contain representations and warranties by each of the parties to the applicable agreement. These representations and warranties have been made solely for the benefit of the parties to the applicable agreement and: • should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate; • have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
• may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and
• were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.
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Accordingly, these representations and warranties may not describe the actual
state of affairs as of the date they were made or at any other time. Additional
information about the Company may be found elsewhere inthis Current Report on
Form 8-K and the Company's other public filings, which are available without
charge through the SEC's website at http://www.sec.gov.
(b) Exhibits
See below.
The following documents are filed as exhibits hereto:
Exhibit Number Exhibit Description 3.1.1 Articles of Incorporation datedApril 24, 2008
incorporated by reference
to Form 10-12g filed 5/11/21
3.1.2 Articles of Merger dated June 5, 2008 incorporated by reference to Form
10-12g filed 5/11/21
3.1.3 Certificate of Amendment dated March 30, 2009 incorporated by reference to
Form 10-12g filed 5/11/21
3.1.4 Certificate of Amendment dated August 29, 2009 incorporated by reference
to Form 10-12g filed 5/11/21
3.1.5 Amendment to Certificate of Designation After
Issuance dated
2009 incorporated by reference to Form 10-12g filed 3.1.6 Certificate of Change datedAugust 11, 2010
incorporated by reference to
Form 10-12g filed 5/11/21
3.1.7 Certificate of Change dated September 21, 2010 incorporated by reference
to Form 10-12g filed 5/11/21
3.1.8 Certificate of Change dated September 30, 2010 incorporated by reference
to Form 10-12g filed 5/11/21
3.1.9 Certificate of Change dated January 31, 2011 incorporated by reference to
Form 10-12g filed 5/11/21
3.1,10 Certificate of Change dated March 17, 2011 incorporated by reference to
Form 10-12g filed 5/11/21
3.1.11 Certificate of Amendment dated January 12, 2018 incorporated by reference
to Form 10-12g filed 5/11/21
3.1.12 Certificate of Amendment dated July 11, 2018 incorporated by reference to
Form 10-12g filed 5/11/21
3.1.13 Certificate of Amendment dated May 16, 2019 incorporated by reference to
Form 10-12g filed 5/11/21
3.1.14 Certificate, Amendment or Withdrawal of Designation dated March 25, 2020
incorporated by reference to Form 10-12g filed 5/11/21
3.2 Bylaws of Petro USA, Inc (formerly All State
incorporated by reference to Form 10-12g filed 5/11/21
23.1 Consent *
* Filed herewith
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PETRO USA, INC.
FORMERLY ALL STATE PROPERTIES HOLDINGS. INC.
FINANCIAL STATEMENTS
JUNE 30, 2022 AND 2021
AND
DECEMBER 31, 2022 AND 2021
C O N T E N T S
Report of Independent Registered Public Accounting Firm -
24
Report of Independent Registered Public Accounting Firm -Boyle CPA, Inc.
26
Audited Balance Sheets as ofJune 30, 2022 and 2021
27
Audited Statements of Operations for Year EndedJune 30, 2022 and 2021
28
Audited Statements of Changes in Stockholders' Deficit for Year
Ended
29
Audited Statements of Cash Flows for Year EndedJune 30, 2022 and 2021
30
Notes to Audited Financial Statements for Year EndedJune 30, 2022 and 2021
31
Unaudited Balance Sheets as ofDecember 31, 2022 and 2021
37
Unaudited Statements of Operations for Three and Six Months Ended
38
Unaudited Statements of Changes in Stockholders' Deficit for Six
Months Ended
39
Unaudited Statements of Cash Flows for Six Months Ended
40
Notes to Unaudited Financial Statements for Six Months Ended
41
Report of Independent Registered Public Accounting Firm -
45
Audited Balance Sheets for Veritaz as ofMarch 31, 2022 and 2021
46
Audited Statements of Operations for Veritaz for Year Ended
48
Audited Statements of Cash Flows for Veritaz for Year Ended
49
Audited Statements of Changes in Stockholders' Deficit for Year
Ended
50
Notes to Audited Financial Statements for Vertitaz for Year Ended
51
Review Report of Independent Registered Public Accounting Firm -
68
Unaudited Balance Sheets for Veritaz as ofDecember 31, 2022 and 2021
69
Unaudited Statements of Operations for Three and Nine Months Ended
70
Unaudited Statements of Cash Flows for Veritaz for Nine Months
Ended
71
Unaudited Statements of Changes in Stockholders' Deficit for Nine
Months Ended
72
Notes to Unaudited Financial Statements for Veritaz for Nine Months
Ended
73
[[Image Removed: Shape DescriptionGries & Associates , automatically generated with medium
LLC
confidence]] Certified Public
Accountants
501 S. Cherry Street
Suite 1100
Denver, Colorado
80246
Report of Independent Registered Public Accounting Firm
Board of Directors and Shareholders
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheet ofPetro USA, Inc. (the "Company") as ofJune 30, 2022 , and the related consolidated statement of operations, statements of stockholders' deficit, and cash flows for the year then ended, and the related notes and schedules (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as ofJune 30, 2022 , and the results of its operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted inthe United States of America . Basis for Opinion These financial statements are the responsibility of the entity's management. Our responsibility is to express an opinion on these financial statements based on our audits. We are a public accounting firm registered with thePublic Company Accounting Oversight Board (United States ) ("PCAOB") and are required to be independent with respect to the Company in accordance with theU.S. federal securities laws and the applicable rules and regulations of theSecurities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Going Concern Uncertainty
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in note 2 to the financial statements, the Company has incurred losses since inception of$121,801,962 . These factors create an uncertainty as to the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Emphasis of Matters-Risks and Uncertainties
blaze@griesandassociates.com
(O)720-464-2875 (M)773-255-5631 (F)720-222-5846
Page 1
[[Image Removed: Shape DescriptionGries & Associates , automatically generated with medium
LLC
confidence]] Certified Public
Accountants
501 S. Cherry Street
Suite 1100
Denver, Colorado
80246
The Company is not able to predict the ultimate impact that COVID -19 will have on its business. However, if the current economic conditions continue, the pandemic could have an adverse impact on the economies and financial markets of many countries, including the geographical area in which the Company plans to operate. /s/Gries & Associates, LLC
We have served as the Company's auditor since 2022.
Denver, CO October 13, 2022 PCAOB# 67789 blaze@griesandassociates.com
(O)720-464-2875 (M)773-255-5631 (F)720-222-5846
Page 2
Boyle CPA, LLC Certified Public Accountants & Consultants
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and
Board of Directors of
Opinion on the Financial Statements
We have audited the accompanying balance sheets ofPetro USA, Inc. (formerlyAll State Properties Holdings, Inc. ) (the "Company") as ofJune 30, 2021 , the related statements of operations, changes in stockholders' deficit, and cash flows for each of the years in the two-year period endedJune 30, 2021 , and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as ofJune 30, 2021 , and the results of its operations and its cash flows for the year endedJune 30, 2021 , in conformity with accounting principles generally accepted inthe United States of America .
Substantial Doubt About the Company's Ability to Continue as a Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company's continuing operating losses raise substantial doubt about its ability to continue as a going concern for a period of one year from the issuance of these financial statements. Management's plans are also described in Note 2. The financial statements do not include adjustments that might result from the outcome of this uncertainty. Basis of Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with thePublic Company Accounting Oversight Board (United States ) ("PCAOB") and are required to be independent with respect to the Company in accordance withU.S. federal securities laws and the applicable rules and regulations of theSecurities and Exchange Commission and the PCAOB. We conducted our audit in accordance with standards of thePublic 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, whether due to fraud or error. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting 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. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. /s/Boyle CPA, LLC . . .
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