Cautionary Note Regarding Forward Looking Statements
This report contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including statements regarding
management's future plans for the Company, our liquidity and ability to raise
capital, our business strategy and our future operations. All statements other
than statements of historical facts contained in this report, including
statements regarding our future financial position, liquidity, working capital
sources, business strategy and plans and objectives of management for future
operations, are forward-looking statements. The words "believe," "may,"
"estimate," "continue," "anticipate," "intend," "should," "plan," "could,"
"target," "potential," "is likely," "will," "expect" and similar expressions, as
they relate to us, are intended to identify forward-looking statements. We have
based these forward-looking statements largely on our current expectations and
projections about future events and financial trends that we believe may affect
our financial condition, results of operations, business strategy and financial
The results anticipated by any or all of these forward-looking statements might
not occur. Important factors, uncertainties and risks that may cause actual
results to differ materially from these forward-looking statements include the
ability to close a reverse merger transaction, the possibility that we are
unable to raise capital as and when needed, the ongoing impact of the
coronavirus pandemic and its negative effect on the U.S. and global economies,
and our lack of an operating history and revenue. Further information on the
risk factors affecting our business is contained in "Risk Factors" of our annual
report on Form 10-K for the fiscal year ended December 31, 2020. We undertake no
obligation to publicly update or revise any forward-looking statements, whether
as the result of new information, future events or otherwise.
PhoneBrasil International, Inc. f/k/a Utz Technologies, Inc. (the "Company", or
"PhoneBrasil") was organized in New Jersey as Donald Utz Engineering, Inc. in
1991. We were a development stage company engaged in the telecommunications
industry and at some point we became a shell issuer as referred to on Rule
144(i) under the Securities Act of 1933.
On December 9, 2020, DR Shell LLC, a Delaware limited liability company ("DR
Shell") purchased from Custodian Ventures LLC, a Wyoming limited liability
company ("Custodian Ventures"), (i) 18,000,000 shares of the Company's common
stock, representing approximately 62% of the outstanding common stock of the
Company, and (ii) 10,000,000 shares of Series A Convertible Preferred Stock of
the Company, in exchange for $245,000 in cash. The shares were acquired pursuant
to a Stock Purchase Agreement, dated December 9, 2020, by and among Custodian
Ventures, DR Shell and David Lazar, then Chief Executive Officer of the Company.
As a result, Mr. Ross DiMaggio, the manager of DR Shell, acquired control of the
The Company currently has no operations and is seeking to acquire a new business
in the United States. We do not generate revenues in the short-term due to the
early-stage nature of our Company.
The evaluation and selection of a business opportunity is a complex and
uncertain process. As previously disclosed in the Company's Current Report on
Form 8-K filed on June 4, 2021, on May 28, 2021, the Company executed a binding
amendment to a non-binding Letter of Intent dated March 8, 2021 (the "LOI") by
and among Mikab Corporation ("Mikab"), Novation Enterpises, LLC ("Novation") and
the Company, which LOI sets forth the preliminary understanding with respect to
a proposed reverse merger in which Mikab Corporation acquires control of the
Company after acquiring certain of the assets of Novation. This transaction has
not closed and we have not executed any definitive agreement although we believe
there is a meeting of minds on all material terms. If we acquire Mikab, its
shareholders will acquire approximately 94.2% of our capital stock.
Mikab and Novation are each service companies engaged in the business of
building a national infrastructure involving the installation of rural wireless
telecommunication cables, upgrading wireless communications towers and going
forward providing services to electronic vehicle (EV) charging stations.
Business opportunities that we believe are in the best interests of the Company
and its shareholders may be scarce, or we may be unable to obtain the businesses
we identify as viable for our objectives such as Mikab, including due to
competitive forces in the marketplace beyond our control. There can be no
assurance that we will be able to locate compatible business opportunities for
the Company. See -"Risk Factors" in our annual report on Form 10-K for the
fiscal year ended December 31, 2020.
Plan of Operation
The Company has no operations from a continuing business other than expenditures
related to running the Company as of the date of this report. If we are unable
to acquire Mikab, we will again explore locating a suitable operating business.
With the changes to SEC Rule 15c2-11 becoming effective in late September 2021,
we will only be able to trade on the Pink Open Market for 18 months following
the effective date of the new Rule. We expect that will create more competition
for operating businesses and may make acquiring an operating business more
difficult and more expensive.
Given our limited capital resources, we may consider a business combination with
an entity which has recently commenced operations, is a developing company or is
otherwise in need of additional funds for the development of new products or
services or expansion into new markets, or is an established business
experiencing financial or operating difficulties and is in need of additional
capital. Alternatively, a business combination may involve the acquisition of,
or merger with, an entity which desires access to the U.S. capital markets.
Additional issuances of equity or convertible debt securities will result in
dilution to our current shareholders. Further, such securities might have
rights, preferences or privileges senior to our common stock. Additional
financing may not be available upon acceptable terms, or at all. If adequate
funds are not available or are not available on acceptable terms, we may not be
able to take advantage of prospective new business endeavors or opportunities,
which could significantly and materially restrict our business operations.
Our prospects must be considered in light of the risks, expenses and
difficulties frequently encountered by companies in their early stage of
development. Such risks for us include, but are not limited to, an evolving and
unpredictable business model, recognition of revenue sources, and the management
of growth. To address these risks, we must, among other things, develop,
implement and successfully execute our business and marketing strategy, respond
to competitive developments, and attract, retain and motivate qualified
personnel. There can be no assurance that we will be successful in addressing
such risks, and the failure to do so could have a material adverse effect on our
business prospects, financial condition and results of operations.
Liquidity and Capital Resources
Cash Flows used by Operating Activities:
For the six months ended June 30, 2021, net cash flows used in operating
activities was $17,550. Net cash flows used in operating activities was $30,182
for the six months ended June 30, 2020.
Cash Flows from Financing Activities:
For the six months ended June 30, 2021, we borrowed $17,550 from our principal
shareholder. In the six months ended June 30, 2020, we borrowed $30,182 from our
former principal shareholder.
We have $-0- cash on hand as of August 1, 2021 and are dependent upon loans from
our principal shareholder to remain operational.
To date, the COVID-19 pandemic has not had a material impact on the Company,
particularly due to our current lack of operations. The pandemic may, however,
have an impact on our ability to evaluate and acquire an operating entity
through a reverse merger or otherwise, and/or on one or more of the businesses
we may acquire. Many government restrictions have been relaxed and the economy
has continued to open in more jurisdictions. However, the emergence of new and
transmittable variants of COVID-19 appears to have led to a resurgence of the
virus, particularly in populations with low vaccination rates and has resulted
in new restrictions in certain geographies and among certain businesses. The
long-term financial impact on us cannot be reasonably estimated at this time. As
a result, the effects of COVID-19 may not be fully reflected in our financial
results until future periods. See "Risk Factors" contained in our annual report
on Form 10-K for the fiscal year ended December 31, 2020 for more information.
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