Special Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"). The words "believe," "may," "will," "potentially," "estimate,"
"continue," "anticipate," "intend," "could," "would," "project," "plan,"
"expect" and similar expressions that convey uncertainty of future events or
outcomes are intended to identify forward-looking statements. These
forward-looking statements include, but are not limited to, statements
concerning our future financial and operating results; our business strategy of
pursuing the acquisition of an operating entity; future financing initiatives;
our intentions, expectations and beliefs regarding a merger, acquisition or
other business combination with a viable operating entity; and our ability to
comply with evolving legal standards and regulations, particularly concerning
requirements for being a public company and
These forward-looking statements speak only as of the date of this Form 10-Q and are subject to uncertainties, assumptions and business and economic risks. As such, our actual results could differ materially from those set forth in the forward-looking statements It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business 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 we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this Form 10-Q may not occur, and actual results could differ materially and adversely from those anticipated or implied in our forward-looking statements.
Forward-looking statements should not be relied upon as predictions of future events. Although we believe that the expectations reflected in our forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances described in the forward-looking statements will be achieved or occur. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. We undertake no obligation to update publicly any forward-looking statements for any reason after the date of this Form 10-Q to conform these statements to actual results or to changes in our expectations, except as required by law.
The following discussion should be read in conjunction with our unaudited condensed consolidated financial statements and notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q with the understanding that our actual future results, levels of activity, performance and events and circumstances may be materially different from what we expect.
Overview
Since
Our principal executive office is located at
7 Table of Contents Acquisition Strategy
Our plan of operation is to arrange for a merger, acquisition, business combination or other arrangement by and between the Company and a viable operating entity. We have not identified a viable operating entity for a merger, acquisition, business combination or other arrangement, and there can be no assurance that the Company will ever successfully arrange for a merger, acquisition, business combination or other arrangement by and between the Company and a viable operating entity.
We anticipate that the selection of a business opportunity will be a complex process and will involve a number of risks, because potentially available business opportunities may occur in many different industries and may be in various stages of development. Due in part to economic conditions in a number of geographic areas, rapid technological advances being made in some industries and shortages of available capital, we believe that there are numerous firms seeking either the limited additional capital which the Company will have or the benefits of a publicly traded corporation, or both. The perceived benefits of a publicly traded corporation may include facilitating or improving the terms upon which additional equity financing may be sought, providing liquidity for principal shareholders, creating a means for providing incentive stock options or similar benefits to key employees, and other factors.
In some cases, management of the Company will have the authority to undertake acquisitions without submitting the proposal to the shareholders for their consideration. In some instances, however, the proposed participation in a business opportunity may be submitted to the shareholders for their consideration, either voluntarily by the Board of Directors to seek the shareholders' advice and consent, or because of a requirement of state law to do so.
In seeking to arrange a merger, acquisition, business combination or other arrangement by and between the Company and a viable operating entity, our objective will be to obtain long-term capital appreciation for the Company's shareholders. There can be no assurance that we will be able to complete any merger, acquisition, business combination or other arrangement by and between the Company and a viable operating entity.
The Company may need additional funds in order to effectuate a merger, acquisition or other arrangement by and between the Company and a viable operating entity, although there is no assurance that we will be able to obtain such additional funds, if needed. Even if we are able to obtain additional funds there is no assurance that the Company will be able to effectuate a merger, acquisition or other arrangement by and between the Company and a viable operating entity.
Critical Accounting Policies
The preparation of financial statements in conformity with generally accepted
accounting principles of
Results of Operations Revenues
During the six months ended
Because the Company's operations are primarily administrative, the fluctuations in net loss relate to decreased interest expense and the timing of general and administrative (G&A) expenses during the period.
8
Table of Contents
General and Administrative Expenses
G&A expenses consist of professional fees, service charges, office expenses and similar items.
During the three months ended
Other Expense
Other expense primarily represents state licenses, filing fees, minimum tax expense and net interest expense.
Other expense increased to
Liquidity and Capital Resources
Cash and cash equivalents consist of cash and money market funds. We did not
have any short-term or long-term investments as of
Historically, the Company satisfied its working capital needs from related party
loans from
On
On
9 Table of Contents
During the six months ended
Principal Interest Balance January 1, 2021$ 251,161 $ 87,624 Additions 5,000 5,657 Cash Payments - - Conversion into Common Stock - March 26, 2021 (256,161) (93,281) Balance March 31, 2021 $ - $ - Additions - - Cash Payments - - Balance June 30, 2021 $ - $ - Balance January 1, 2022 $ - $ - Additions 20,000 40 Cash Payments - - Balance March 31, 2022$ 20,000 $ 40 Additions 10,000 826 Cash Payments - - Balance June 30, 2021$ 30,000 $ 866
While the cash received from the 2022 Loan will satisfy the Company's immediate financial needs, it will not by itself have the capacity to provide the Company with sufficient capital to finance a merger, acquisition or business combination between the Company and a viable operating entity. The Company may need additional funds in order to complete a merger, acquisition or business combination between the Company and a viable operating entity. There can be no assurances that the Company will be able to obtain additional funds if and when needed.
Economy and Inflation
Many leading economists predict high rates of inflation will continue through 2022. While we do not believe inflation has had a material effect on our Company's results of operations, inflation generally interferes with the provision of investment capital. A prolonged period of high inflation may impact our ability to carry out our acquisition strategy. On the other hand, when business conditions worsen and the stock market corrects, it may be easier for us to identify an acquisition candidate.
In late 2019, there was an outbreak of a new strain of coronavirus (COVID) first
identified in
The extent to which new opportunities are presented to us will depend on future developments, which remain highly uncertain and cannot be predicted with confidence.
Off-Balance Sheet and Contractual Arrangements
Our liquidity is not dependent on the use of off-balance-sheet financing arrangements.
© Edgar Online, source