The following discussion and analysis provide information which management of
the Company believes to be relevant to an assessment and understanding of the
Company's results of operations and financial condition. This discussion should
be read together with the Company's financial statements and the notes to the
financial statements, which are included in this report.
Forward-Looking Statements
This Report contains forward-looking statements that relate to future events or
our future financial performance. Some discussions in this report may contain
forward-looking statements that involve risk and uncertainty. A number of
important factors could cause our actual results to differ materially from those
expressed in any forward-looking statements made by us in this Report.
Forward-looking statements are often identified by words like "believe,"
"expect," "estimate," "anticipate," "intend," "project" and similar words or
expressions that, by their nature, refer to future events.
In some cases, you can also identify forward-looking statements by terminology
such as "may," "will," "should," "plans," "predicts," "potential," or
"continue," or the negative of these terms or other comparable terminology.
These statements are only predictions and involve known and unknown risks,
uncertainties, and other factors that may cause our actual results, levels of
activity, performance or achievements to be materially different from any future
results, levels of activity, performance or achievements expressed or implied by
these forward-looking statements.
Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, or achievements. You should not place undue certainty on these
forward-looking statements, which apply only as of the date of this Report.
These forward-looking statements are subject to certain risks and uncertainties
that could cause actual results to differ materially from historical results or
our predictions. Except as required by applicable law, including the securities
laws of the United States, we do not intend to update any of the forward-looking
statements in an effort to conform these statements to actual results.
Financial Condition
As of February 28, 2017, the Company had total current assets of $19,921 and
total current liabilities of $5,490,782 for a net working capital deficit of
$5,470,861. As of February 29, 2016, the Company had total current assets of
$26,864 and total current liabilities of $5,381,900 for a net working capital
deficit of $5,355,036.
We need to raise additional money to meet our general and administrative
expenses, and we need to raise money to achieve our business objectives. The
additional funding will come from equity financing from the sale of Telco Cuba's
common stock or the issuance of debt securities. If we are successful in
completing an equity financing, existing shareholders will experience dilution
of their interest in Telco Cuba. The Company does not have any financing
arranged and we cannot provide investors with any assurance that the Company
will be able to raise sufficient funding from the sale of its common stock or
debt securities. In the absence of such financing, our business will fail.
Based on the nature of Telco Cuba's business, management anticipates incurring
operating losses in the foreseeable future. Management bases this expectation,
in part, on the fact that unrolling a telecommunications operation will cost a
substantial amount of money, and possibly take several years before becoming
profitable. The Company's future financial results are also uncertain due to a
number of factors, some of which are outside its control. These factors include,
but are not limited to:
Telco Cuba's ability to raise additional funding is based on;
Telco Cuba's ability to capture market share; and
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Due to the Company's lack of operating history and present inability to generate
revenues, our independent auditors have added an explanatory paragraph to their
audit opinion issued in connection with our financial statements for 2015, and
2016 indicating substantial doubt about Telco Cuba's ability to continue as a
going concern. This means that there is substantial doubt whether the Company
can continue as an ongoing business for the next 12 months unless we obtain
additional capital to pay our bills.
Liquidity
The Company's internal sources of liquidity will be loans that may be available
from management as well as revenue from its subsidiaries. Although Telco Cuba
has no written arrangements with its management, we expect that the officers may
provide the Company with nominal liquidity, when and if it is required.
The Company's external sources of liquidity will be private placements for
equity and debt financing. There are no assurances that Telco Cuba will be able
to achieve further sales of its common stock or any other form of additional
financing. If we are unable to achieve the financing necessary to continue its
plan of operations, then the Company will not be able to continue its operations
and its business will fail.
Capital Resources
The Company's current cash is not sufficient to fully finance its operations at
current and planned levels for the next 12 months. Management intends to manage
the Company's expenses and payments to preserve cash until the Company is
profitable, otherwise additional financing must be arranged. Specifically,
management is deferring payments due them until such time as there is sufficient
financing in place to permit their payment or the possible issuance of the
Company's stock in settlement of amounts due.
Overview
Telco Cuba, Inc. (fka CaerVision Global, Inc. fka American Mineral Group Inc.)
(the "Company") was incorporated under the laws of the State of Nevada on August
10, 2007. On June 15, 2015, the Company effectuated an amendment to its articles
of incorporation to change its name from CaerVision Global, Inc. to Telco Cuba,
Inc.
On June 12, 2015, the Company consummated a Share Exchange with Amgentech, Inc.,
a Florida corporation. Under the terms of the Share Exchange, the holders of
Amgentech received 50,088 shares of Series B Preferred Stock that had been
previously issued to third parties in exchange for 100% of the issued and
outstanding capital of Amgentech. Each shares of Series B preferred is
convertible into 5,000 shares of common stock (254,440,000 shares total) and has
voting rights of 5,000 per share (254,440,000 votes). As a result of this
transaction, Amgentech became a wholly-owned subsidiary of the Company with
control transferring to the previous owners of Amgentech. Amgentech elected to
be treated as the successor issuer for SEC reporting and accounting purposes.
The Share Exchange was accounted for as a reverse acquisition and
re-capitalization. The Amgentech Shareholders obtained approximately 60% of
voting control on the date of Share Exchange. Amgentech was the acquirer for
financial reporting purposes and the Company was the acquired company. The
Company filed an amendment to its articles of incorporation and changed its name
to Telco Cuba, Inc.
Amgentech, Inc. is a Florida based Corporation engaged in the business of
providing technology solutions, integrating and building technology
infrastructure and software and website development. Amgentech, Inc. also offers
managed collocated and leased servers. Originally founded in 2001, Amgentech,
Inc. has been providing Internet based solutions, VoIP infrastructure and
consulting services for over 14 years to diverse clients in The United States of
America, the counties of El Salvador, Nicaragua, Costa Rica, Panama, Colombia
and Venezuela. Amgentech, Inc. continues to provide these same services, in
addition to providing the technical and Internet know how to implement the
technological vision that is envisioned for Telco Cuba, Inc., Amgentech will be
the sole technical services provider.
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Principal Products
Telco Cuba, Inc. offers telecommunication services and equipment, including
mobile phones, mobile voice service, VoIP service, and calling cards. The
services and devices initially offered will be for consumption solely in The
United States of America. Telco Cuba, Inc. has positioned itself to offer low
cost mobile cell phone service/plans in The United States. Telco Cuba, Inc. will
offer prepaid service/plans that include predefined minute/unlimited minute
plans. Telco Cuba, Inc. is positioning itself to enter the telecommunications
market in Cuba once able to.
Our Market
The Company targets the US and Cuban markets.
Results of operations
Comparison of the quarter ended February 28, 2017, to the quarter ended February
29, 2016
The financial data presented below should be read in conjunction with the more
detailed financial statements and related notes, which are included elsewhere in
this report. Information discussed herein, as well as elsewhere in this
Quarterly Report on Form 10Q, includes forward-looking statements or opinions
regarding future events or the future financial performance of the Company, and
are subject to a number of risks and other factors which could cause the actual
results to differ materially from those contained in forward-looking statements.
Among such factors are general business and economic conditions, and risk
factors as listed in this Form 10-Q or listed from time to time in documents
filed by the Company with the Securities and Exchange Commission.
Revenues
Revenues for the three months ended February 28, 2017, were $31,679, compared to
$38,149 for the three months ended February 29, 2016. The decrease in revenues
resulted from a shift in focus to Cuban-based telecommunications which
management believes has greater revenue potential in the long term.
Operating Expenses
Operating expenses for the three months ended February 28, 2016, consisted of
$97,972 in general and administrative expense compared to $177,645 for the three
months ended February 29, 2016. The decrease resulted from additional, one-time
expenses incurred due to the addition of Amgentech operations in the prior year.
Other Income (Expense): :
Other income (expense) for the three months ended February 28, 2017, and
February 29, 2016, was $(97,864), and $634,151, respectively, The decrease
resulted primarily from debt extinguishment in 2016, and changes in fair value
of the derivative liability.
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Net Income:
Net Income (Loss) of $(164,157), and $494,655, for the three months ended
February 28, 2017, and February 29, 2016, respectively, was due primarily to
changes in the fair value of derivative liability and extinguishment of debt in
2016.
Off-Balance Sheet Arrangements
The Company has no off-balance sheet arrangements.
Subsequent Events
The Company evaluated subsequent events from March 1, 2017, through the date
this filing was completed, noting the following:
During the month of July 2017, the company procured settlements with three note
holders. The settlements were a result of the company's renegotiating of the
terms of the original notes. The new terms included the waiving of all
additional interest, waiving of default fees, conversion standstill and
restrictions on the number of conversions per month, and fixed balances. The
notes affected by these settlements were with EMA Financial, Essex Global
Investment Corp, and LG Capital.
During the month of August 2017, the company wrote off a promissory note which
resulted in a $2,000,000 gain, which is reported in the statements of operations
as other income. The write off occurred as a result of the rescission, by the
prior owner of a transaction involving a working interest the company had in a
certain oil property. The original transaction occurred during the month of
July, in the year 2014.
On October 25, 2017, the Company entered into a definitive purchase agreement
with Net Bee Wireless, Inc. The purchase was contingent on the Company making
the purchase price payment. The deal was rescinded in February 2018 as a result
of the company not opting to follow through on the purchase.
During the month of December 2017, the company issued a promissory note in the
amount of $60,000 in exchange for the assets of Naked Papers, Inc.
During the month of December 2017, the Company converted a total of $26,031.55
in convertible debt and accrued interest owed to unaffiliated third-party
accredited investors in 276,163,333 shares of restricted common stock.
During the month of December 2017, the Company issued 500,000 Preferred C Stock
to the Company's CEO in exchange for services rendered to the Company.
During the first quarter 2018, the company acquired the assets of Naked Papers
and is currently selling the product under its brand name, Naked Papers under
the subsidiary, Naked Papers Brand, Inc., incorporated in the state of Florida.
During the month of January 2018, the Company converted a total of $63,734.00 in
convertible debt and accrued interest owed to unaffiliated third-party
accredited investors in 1,262,266,666 shares of restricted common stock.
During the month of February 2018, the Company converted a total of $38,925.56
in convertible debt and accrued interest owed to unaffiliated third-party
accredited investors in 768,225,915 shares of restricted common stock.
During the month of March 2018, the Company converted a total of $14,550.00 in
convertible debt and accrued interest owed to unaffiliated third-party
accredited investors in 306,000,000 shares of restricted common stock.
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Anthony J Rivera brought a lawsuit against the company on May 29, 2018. Case
number: CACE18012914 in the 17th circuit court of Broward County, Florida. The
note holder sued for enforcement of a note issued by the company on December 1,
2015. The case was settled, and the note was amended with a more favorable 50%
discount, 5 day look back term on the note. The settlement occurred on
September, 2018. The company is working with the note holder to convert the
settled amount into stock of the company.
On September 28, 2018, the company filed a lawsuit against Cuentas, Inc. (OTCQB:
CUEN), f/k/a Next Group Holdings, Inc/Meimoun & Mammon, LLC/Next Mobile, LLC in
the 11th circuit court of Miami-Dade County, Florida. Case number:
2018-032974-CA-01 is still ongoing. The case was filed due to CUEN failing to
perform on a contract signed on July 2015. The company is suing for damages and
the return of the funds paid for the undelivered Mobile Virtual Network Operator
(MVNO) platform.
During the first quarter 2019, the company acquired Advanced Satellite Systems,
Inc. and all of its assets, and is continuing to offer its services under the
Advanced Cable service mark. Advanced Satellite Systems, Inc, is incorporated in
the state of Florida and is registered as a subsidiary of Telco Cuba, Inc.
During the month of February 2019, the company issued a promissory note in the
amount of $100,000.00 to purchase Advanced Satellite Systems, Inc.
During the month of February 2019, the Company converted a total of $16,900.00
in convertible debt and accrued interest owed to unaffiliated third-party
accredited investors in 338,000,000 shares of restricted common stock.
During the month of March 2019, the Company converted a total of $18,500.00 in
convertible debt and accrued interest owed to unaffiliated third-party
accredited investors in 370,000,000 shares of restricted common stock.
During the month of March 2019, the Company issued 250,000,000 shares to Mr.
Roland H Malo as part of the compensation he received for staying on with
Advanced Satellite Systems, Inc.
During the month of May 2019, JMZ Alliance forgave all debt owed to JMZ Alliance
by Telco Cuba, Inc. The note securing the debt as well as all interest was
forgiven by JMZ.
During the month of April 2019, the Company converted a total of $15,000.00 in
convertible debt and accrued interest owed to unaffiliated third-party
accredited investors in 300,000,000 shares of restricted common stock.
During the month of December 2020, the Company converted a total of $3,900.00 in
convertible debt and accrued interest owed to unaffiliated third-party
accredited investors in 93,000,000 shares of common stock.
During the month of January 2021, the Company converted a total of $51,388.81 in
convertible debt and accrued interest owed to unaffiliated third-party
accredited investors in 599,867,533 shares of common stock.
During the month of January 2021, the Company converted the partial monetary
value of a consultants' contract into 441,977,932 restricted common shares.
During the month of February 2021, the Company converted the partial monetary
value of a consultants' contract into 34,000,000 restricted common shares.
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During the month of February 2021, a shareholder converted 55,555 Series A
shares into 55,555,000 restricted common shares. These common shares have an
effective date of February 11, 2021 and are denoted as such in section 3A of
this disclosure.
During the month of February 2021, the Company converted a total of $49,259.66
in convertible debt and accrued interest owed to unaffiliated third-party
accredited investors in 164,198,867 shares of common stock.
During the month of March 2021, 23,574,570 restricted common shares were issued
to appointed members of the board of directors.
During the month of March 2021, preferred B shareholders converted 6,000
preferred shares into 30,000,000 restricted common shares.
During the month of March 2021, the Company converted a total of $7,000.00 in
convertible debt to an unaffiliated third-party accredited investor into
46,666,667 shares of common stock.
During the month of April 2021, the company converted a total of $62,966 in
convertible debt and accrued interest owed to an unaffiliated third-party
accredited investor into 155,471,605 shares of common stock.
During the month of May 2021, the company restated a promissory note as
convertible in the amount of $100,000.00. The holder, an unaffiliated
third-party unaccredited investor converted the note principle and accrued
interest owed into 400,000,000 restricted common shares. These common shares
have an effective date of May 6, 2021 and are denoted as such in section 3A of
this disclosure.
During the month of May 2021, the company converted a total of $54,934.69 in
convertible debt and accrued interest owed to an unaffiliated third-party
accredited investor into 73,246,253 shares of common stock. These common shares
have an effective date of May 6, 2021, and are denoted as such in section 3A of
this disclosure.
During the month of May 2021, a third-party accredited investor/noteholder
cancelled and returned 155,471,605 common shares to the company due to a
reversal of a third party note purchase.
During the month of May 2021, 25,000,000 restricted common shares were issued to
appointed members of the board of directors.
During the month of May 2021, the company converted a total of $52,021.00 in
convertible debt and accrued interest owed to an unaffiliated third-party
accredited investor into 115,602,222 shares of common stock.
During the month of May 2021, the company sold 40,000,000 shares of restricted
common stock to an unaffiliated third-party accredited investor for $10,000.00.
These common shares have an effective date of May 26, 2021.
We evaluated subsequent events after the balance sheet date through the date the
financial statements were issued. We did not identify any additional material
events or transactions occurring during this subsequent event reporting period
that required further recognition or disclosure in these financial statements.
Accounting Principles
The accounting and reporting policies of the Company conform to United States
generally accepted accounting principles.
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