You should read the following discussion in conjunction with our financial
statements, which are included elsewhere in this report. The following
information contains forward-looking statements. (See "Forward Looking
Statements.")
General
The Company is a shell company that conducts no active business operations and
is seeking business opportunities for acquisition or participation by the
Company.
The Report of Independent Registered Public Accounting Firm on the Company's
2020 audited financial statements addresses an uncertainty about the Company's
ability to continue as a going concern, indicating that the Company has incurred
losses since its inception and has no on-going operations. The report further
indicates that these factors raise substantial doubt about the Company's ability
to continue as a going concern. At December 31, 2020, the Company had a working
capital deficit of $478,956 and an accumulated deficit of $980,344. The Company
incurred net losses of $119,191 and $101,915 for its fiscal years ended December
31, 2020 and 2019, respectively. There can be no assurance that the Company
will be able to obtain the additional debt or equity capital required to
continue its operations.
The Fiscal Year Ended December 31, 2020 Compared to the Fiscal Year Ended
December 31, 2019
The Company did not conduct any operations during its fiscal year ended December
31, 2020 or 2019. At December 31, 2020, the Company had cash in the amount of
$667 as compared to cash at December 31, 2019 in the amount of $8,761. The
decrease in cash from 2020 compared to 2019 is mainly the result of the net loss
generated during 2020, payments made on accounts payable, notes payable and
accrued interest along with proceeds received from notes payable issued by the
Company.
At December 31, 2020, the Company had current liabilities of $479,623,
consisting of accounts payable of $53,943, accounts payable - related party of
$1,500, accrued interest payable - related parties of $20,561, accrued interest
of $38,503, convertible notes payable of $32,282, notes payable of $150,000, and
notes payable - related parties of $182,834. At December 31, 2019, the Company
had current liabilities of $375,012, consisting of accounts payable of $37,783,
accounts payable - related party of $1,500, accrued interest payable - related
parties of $12,289, accrued interest of $19,922, convertible note payable of
$6,284, notes payable of $145,000, and notes payable - related parties of
$152,234. The Company had a working capital deficit of $478,956 at December 31,
2020 as compared to a working capital deficit of $366,251 at December 31, 2019.
The Company did not generate revenues during its 2020 or 2019 fiscal years. The
Company's general and administrative expenses were $75,141 during the year ended
December 31, 2020 as compared to $70,033 during the year ended December 31,
2019. The Company did not expect a significant change in general and
administrative expenses.
The Company incurred interest expense of $44,050 during the year ended December
31, 2020 as compared to interest expense of $31,882 during the year ended
December 31, 2019. The increase in interest expense is due to the increase in
borrowings on notes payable.
The Company incurred a net loss of $119,191 during the year ended December 31,
2020 as compared to a net loss of $101,915 during the year ended December 31,
2019. The $17,276 increase in net loss in 2020 as compared to 2019 is primarily
the result of increased general and administrative expenses and increased
interest expense related to notes payable of the Company.
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Net cash used by operating activities was $68,694 during the 2020 fiscal year
resulting primarily from the net loss of $119,191, which was offset by the
amortization of debt discount of $7,198, depreciation in the amount of $286, a
$16,160 increase in accounts payable and a $26,853 increase in accrued interest.
Net cash used by operating activities was $79,251 during the 2019 fiscal year
resulting primarily from the net loss of $101,915, which was offset by the
amortization of debt discount of $284, depreciation in the amount of $286, a
$9,443 increase in accounts payable and a $12,651 increase in accrued interest.
There were no cash flows from investing activities during the 2020 and 2019
fiscal years.
Net cash provided by financing activities was $60,600 during the 2020 fiscal
year which consisted of proceeds received from the issuance of notes payable in
the amount of $66,600, and the repayment of notes payable of $6,000. Net cash
provided by financing activities was $56,314 during the 2019 fiscal year which
consisted of proceeds received from the issuance of notes payable in the amount
of $71,000, and the repayment of notes payable of $14,686.
The Company cannot presently foresee the cash requirements of any business
opportunity which may ultimately be acquired by the Company. However, since it
is likely that any business it acquires will be involved in active business
operations, the Company anticipates that an acquisition will result in increased
cash requirements as well as increases in the number of employees of the
Company.
Off-Balance Sheet Arrangements
The Company has not entered into any off-balance sheet arrangements that have or
are reasonably likely to have a current or future effect on its financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures, or capital resources that is
material to investors.
Critical Accounting Policies
Due to the lack of current operations and limited business activities, the
Company does not have any accounting policies that it believes are critical to
facilitate an investor's understanding of the Company's financial and operating
status.
Recent Accounting Pronouncements
The Company has not adopted any new accounting policies that would have a
material impact on the Company's financial condition, changes in financial
condition or results of operations.
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