Attached files
FORM S-1 OF FLEX CAPITAL CORPORATION
As Filed With the Securities and Exchange Commission on July 13,
2011
Registration
No. 333-164616
=====================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 2054
Amendment No. 7
FORM S-1/A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
FLEX CAPITAL CORPORATION
(Exact name of registrant as specified in its charter)
Nevada 7370
N/A
(State or other jurisdiction (Primary Standard Industrial
(IRS Employer
of organization) Classification Code)
Identification #)
Room 1707, Unit C 17th Floor CTS Center
219 Zhong Shan Wu Road, Guangzhou, China,
510031, T: 86-13808821282 F: 86-2083332588
E: flexcapital@live.com
Incorp Services, Inc., 375 N. Stephanie St. Ste 1411
Henderson, Nevada, 89014-8909 800-737-3372)
with a copy to:
Catalyst Img Capital Partners
Room 1707,, 17th Floor CTS Center
219 Zhong Shan Wu Road, Guangzhou, China,
510031, T: 86-13808821282
F: 86-2083332588
With a copy to:
Catalyst Capital Img
Unit 232 2498 w. 41st.
Vancouver, B.C. V6M 2A7
T:604-269-6622 F: 604-269-6623
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As
soon as practicable after the effective date of this Registration
Statement.
If any of the securities being registered on the Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933 check the following box: [X]
If this Form is filed to register additional common stock for an
offering under Rule 462(b) of the Securities Act, please check the
following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same
offering.
If this Form is a post-effective amendment filed under Rule 462(c)
of the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier
effective registration statement for the same offering.
If this Form is a post-effective amendment filed under Rule 462(d)
of the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of "large accelerated filer,"
"accelerated filer" and "smaller reporting company" in Rule 12b-2 of
the Exchange Act. (Check one):
Large accelerated filer [ ]
Accelerated filer [ ]
Non-accelerated filer [ ]
Smaller reporting company [X]
(Do not check if smaller reporting company)
CALCULATION OF REGISTRATION FEE
=====================================================================
Securities to be Amount To Be Offering Price Aggregate Registration
Registration Registered Per Share [1] Offering Price Fee
----------------------------------------------------------------------------
Common Stock: 2,000,000 0.01 $20,000 $1.43
=====================================================================
[1] Estimated solely for purposes of calculating the registration
fee under Rule 457. The offering price has been arbitrarily
determined by the Company and bears no relationship to assets,
earnings, or any other valuation criteria. No assurance can be given
that the shares offered hereby will have a market value or that they
may be sold at this, or at any price.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH
DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL
THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY
STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME
EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF
1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT
TO SAID SECTION 8(A), MAY DETERMINE.
=====================================================================
1
PROSPECTUS
FLEX CAPITAL CORPORATION
SHARES OF COMMON STOCK
1,000,000 MINIMUM - 2,000,000 MAXIMUM
Before this offering, there has been no public market for our common
stock. In the event that we sell at least the minimum number of
shares in this offering, of which there is no assurance, we intend
to have our shares of common stock quoted on the Over the Counter
Bulletin Board operated by the Financial Industry Regulatory
Authority. To be quoted on the Over the Counter Bulletin Board, a
market maker must file an application on our behalf to make a market
for our common shares. There is no guarantee that we will find
a market maker to trade our securities, thus, there is no assurance
that our shares will ever be quoted on the Over the Counter Bulletin
Board.
We are offering a minimum of 1,000,000 up to a maximum of 2,000,000
shares of our common stock in a direct public offering, without any
involvement of underwriters or broker-dealers. The offering price is
$0.01 per share. In the event that 1,000,000 shares are not sold
within 270 days, all money received by us will be promptly returned
to you without interest or deduction of any kind.
However, future actions by creditors in the subscription period
could preclude or delay us in refunding your money. If at least
1,000,000 shares are sold within270 days, all money received will be
retained by us and there will be no refund. Funds will be held in a
separate bank account at US Bank, 2385 North Oxnard Boulevard,
Oxnard, CA, 93136. The bank's telephone number is (805) 604-2200.
Sold securities are deemed securities which have been paid for with
collected funds prior to expiration of 270 days. Collected funds are
deemed funds that have been paid by the drawee bank. The foregoing
account is not an escrow, trust or similar account. It is merely a
separate account under our control where we have segregated your
funds. As a result, creditors could attach the funds.
There is no minimum purchase requirement and there are no
arrangements to place the funds in an escrow, trust, or similar
account. Our common stock will be sold on our behalf by Qing Feng
LU, our sole officer and director. Mr. Lu will not receive any
commissions or proceeds from the offering for selling shares on our
behalf. Finally, for tax advantages, we have selected Nevada to base
our office.
The company is a startup company and as of now the company has no
independent directors, a separate compensation committee nor, an
audit committee.
INVESTING IN OUR COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS"
STARTING AT
PAGE 4.
Offering Price Expenses Proceeds to Us
-------------- -------- --------------
Per Share - Minimum $ 0.01 $ 0.005 $ 0.005
Per Share - Maximum $ 0.01 $ 0.0025 $ 0.0075
Minimum $ 10,000 $ 5,000 $ 5,000
Maximum $ 20,000 $ 5,000 $ 15,000
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE
SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus is July 13, 2011.
TABLE OF CONTENTS Page No.
--------
Summary of Prospectus 3
Risk Factors 4
Use of Proceeds 7
Determination of Offering Price 8
Dilution of the Price You Pay for Your Shares 8
Plan of Distribution; Terms of the Offering 11
Management's Discussion and Analysis of Financial Condition
and Results of Operations 14
Business 16
Management 18
Executive Compensation 19
Principal Shareholders 20
Description of Securities 21
Certain Transactions 22
Litigation 22
Experts 23
Legal Matters 23
Financial Statements 23
2
SUMMARY OF OUR OFFERING
OUR BUSINESS
We were incorporated on October 27, 2009. We are a development stage
company. We do not have any revenues or operations, and we have
minimal assets and have incurred losses since inception. We intend
to create a web portal system which will collect and disseminate
tracking information on goods and services provided to the general
public.
We have no revenues, have achieved losses since inception, have no
operations, have been issued a going concern opinion and rely upon
the sale of our securities to fund operations. Should we require
additional funding, we will borrow from our sole officer and
director. Our sole officer and director has not set limitations
or terms on the lending amount that may occur in the future. Any
lending provided by our sole officer and director will be legally
documented for future repayments.
Our administrative office is located at Room 1707, C, 17th Floor CTS
Center 219 Zhong Shan Wu Road, Guangzhou, China and our telephone
number is 86-13808821282. Our registered statutory office is located
at 375 N Stephanie St. Ste 1411, Henderson, Nevada. Other than our
offices mentioned, we hold no other principal plants or physical
properties. Mr. Lu has arranged for our company to conduct
operations at this office free of rent. This office space is not Mr.
Lu's employer's place of business, and is provided by Mr. Lu's
business associate. Furthermore, there are no terms or conditions
to occupy this office space to conduct our operations.
Our fiscal year end is December 31. Management or affiliates thereof
will not purchase shares in this offering in order to reach the
minimum.
THE OFFERING
Following is a brief summary of this offering:
Securities being offered A minimum of 1,000,000 shares of
common stock
and a maximum of 2,000,000 shares
of common
stock, par value $0.001.
Offering price per share $0.01
Offering period Our shares are being offered for a
period not
to exceed 270 days.
Net proceeds to us Approximately $5,000 assuming the
minimum
numbers of shares are sold.
Approximately
$15,000 assuming the maximum
number of shares
is sold.
Use of proceeds We will use the proceeds to pay
for offering
expenses, the implementation of
our business
plan, and for working capital.
Number of shares outstanding
before the offering 4,000,000
Number of shares outstanding
after the offering if all
of the shares are sold 6,000,000
3
SELECTED FINANCIAL DATA
The following financial information summarizes the more complete
historical financial information at the end of this prospectus.
As of December 31, 2009 As of December 31, 2010
-------------------- ----------------------
(audited) (unaudited)
BALANCE SHEET
Total Assets $ 0 $ 0
Total Liabilities $ 0 $ 0
Stockholders' Deficit $ - $ (1,250)
October 27, 2009 (Inception)
to December 31, 2009 December 31, 2010
---------------- ----------------
(audited) (unaudited)
INCOME STATEMENT
Revenue $ 0 $ 0
Total Expenses $ 0 $ 5,250
Net Loss $ 0 $ (5,250)
RISK FACTORS
PLEASE CONSIDER THE FOLLOWING RISK FACTORS BEFORE DECIDING TO INVEST
IN OUR COMMON STOCK.
RISKS ASSOCIATED WITH FLEX CAPITAL CORPORATION.
BECAUSE OUR AUDITORS HAVE ISSUED A GOING CONCERN OPINION, THERE IS
SUBSTANTIAL UNCERTAINTY THAT WE WILL CONTINUE OPERATIONS IN WHICH
CASE YOU COULD LOSE YOUR INVESTMENT.
Our auditors have issued a going concern opinion. This means that
there is substantial doubt that we can continue as an ongoing
business for the next twelve months. The financial statements do not
include any adjustments that might result from the uncertainty about
our ability to continue in business. As such we may have to cease
operations and you could lose your investment.
WE LACK AN OPERATING HISTORY AND HAVE LOSSES THAT WE EXPECT TO
CONTINUE INTO THE FUTURE. THERE IS NO ASSURANCE OUR FUTURE
OPERATIONS WILL RESULT IN PROFITABLE REVENUES. IF WE CANNOT GENERATE
SUFFICIENT REVENUES TO OPERATE PROFITABLY, WE WILL CEASE OPERATIONS
AND YOU WILL LOSE YOUR INVESTMENT.
We were incorporated on October 27, 2009 and we have not started our
proposed business operations or realized any revenues. We have no
operating history upon which an evaluation of our future success or
failure can be made. Our ability to achieve and maintain
profitability and positive cash flow is dependent upon:
* completion of this offering;
* our ability to create a viable distribution and a data
collection mode for our service; and,
* our ability to generate ad revenues through the use of our
product.
4
Based upon current plans, we expect to incur operating losses in
future periods since we will be incurring expenses and not
generating revenues. We cannot guarantee that we will be successful
in generating revenues in the future. Failure to generate revenues
will cause you to lose your investment.
IF WE DO NOT ATTRACT USERS, WE WILL NOT MAKE A PROFIT WHICH
ULTIMATELY WILL RESULT IN A CESSATION OF OPERATIONS.
We have no web portal. We have not identified any actual locations
for Our web portal and we cannot guarantee we will ever have any
customers using this service. Even if we obtain users, there is no
guarantee that we will generate a profit. If we cannot generate a
profit, we will have to suspend or cease operations.
WE ARE SOLELY DEPENDENT UPON THE FUNDS TO BE RAISED IN THIS OFFERING
TO START OUR BUSINESS, THE PROCEEDS OF WHICH MAY BE INSUFFICIENT TO
ACHIEVE REVENUES. IF WE NEED ADDITIONAL FUNDS AND ARE UNABLE TO
RAISE THEM WE WILL HAVE TO TERMINATE OUR OPERATIONS.
We have not yet started our business. We need the proceeds from this
offering to start our operations. If the minimum of $10,000 is
raised, this amount will enable us, after paying the expenses of
this offering, to operate for one year. If we need additional funds
and are unable to raise the money, we will have to cease operations.
IF WE DO NOT EARN A PROFIT, WE MAY HAVE TO SUSPEND OR CEASE OPERATIONS.
Since we are small and do not have much capital, we must limit
marketing our services. The sale of goods is how we will initially
generate revenues. Because we will be limiting our marketing
activities, we may not be able to attract enough customers to
operate profitably. If we cannot operate profitably, we may have to
suspend or cease operations.
BECAUSE OUR SOLE OFFICER AND DIRECTOR WILL ONLY BE DEVOTING LIMITED
TIME TO OUR OPERATIONS, OUR OPERATIONS MAY BE SPORADIC WHICH MAY
RESULT IN PERIODIC INTERRUPTIONS OR SUSPENSIONS OF OPERATIONS. THIS
ACTIVITY COULD PREVENT US FROM ATTRACTING CUSTOMERS AND RESULT IN A
LACK OF REVENUES THAT MAY CAUSE US TO SUSPEND OR CEASE OPERATIONS.
Our sole officer and director, Mr. Lu, will only be devoting limited
time to our operations. Mr. Lu, our president and sole director will
be devoting approximately 20 hours per week of his working time to
our operations. Because our sole officer and director will only be
devoting limited time to our operations, our operations may be
sporadic and occur at times which are convenient to him As a result,
operations may be periodically interrupted or suspended which could
result in a lack of revenues and a possible cessation of operations.
BECAUSE WE HAVE ONLY ONE OFFICER AND DIRECTOR WHO HAS NO FORMAL
TRAINING IN FINANCIAL ACCOUNTING AND MANAGEMENT, WHO IS RESPONSIBLE
FOR OUR MANAGERIAL AND ORGANIZATIONAL STRUCTURE, IN THE FUTURE,
THERE MAY NOT BE EFFECTIVE DISCLOSURE AND ACCOUNTING CONTROLS TO
COMPLY WITH APPLICABLE LAWS AND REGULATIONS WHICH COULD RESULT IN
FINES, PENALTIES AND ASSESSMENTS AGAINST US.
We have only one officer and director. He has no formal training in
financial accounting and management; however, he is responsible for
our managerial and organizational structure which will include
preparation of disclosure and accounting controls under the Sarbanes
Oxley Act of 2002. When the disclosure and accounting controls
referred to above are implemented, he will be responsible for the
administration of them. Should he not have sufficient experience, he
may be incapable of creating and implementing the controls which may
cause us to be subject to sanctions and fines by the SEC which
ultimately
5
could cause you to lose your investment. However, because of the
small size of our expected operations, we believe that he will be
able to monitor the controls he will have created and will be
accurate in assembling and providing information to investors.
BECAUSE OUR SOLE OFFICER AND DIRECTOR DOES NOT HAVE PRIOR EXPERIENCE
IN FINANCIAL ACCOUNTING AND THE PREPARATION OF REPORTS UNDER THE
SECURITIES EXCHANGE ACT OF 1934, WE MAY HAVE TO HIRE INDIVIDUALS
WHICH COULD RESULT IN AN EXPENSE WE ARE UNABLE TO PAY.
Because our sole officer and director does not have prior experience
in financial accounting and the preparation of reports under the
Securities Act of 1934, we may have to hire additional experienced
personnel to assist us with the preparation thereof. If we need the
additional experienced personnel and we do not hire them, we could
fail in our plan of operations and have to suspend operations or
cease operations entirely and you could lose your investment.
RISKS ASSOCIATED WITH THIS OFFERING:
BECAUSE WE DO NOT HAVE AN ESCROW OR TRUST ACCOUNT FOR YOUR
SUBSCRIPTION, IF WE FILE FOR BANKRUPTCY PROTECTION OR ARE FORCED
INTO BANKRUPTCY, OR A CREDITOR OBTAINS A JUDGMENT AGAINST US AND
ATTACHES THE SUBSCRIPTION, YOU WILL LOSE YOUR INVESTMENT.
Your funds will not be placed in an escrow or trust account.
Accordingly, if we file for bankruptcy protection or a petition for
involuntary bankruptcy is filed by creditors against us, your funds
will become part of the bankruptcy estate and administered according
to bankruptcy laws. If a creditor sues us and obtains a judgment
against us, the creditor could garnish the bank account and take
possession of the subscriptions. As such, if the minimum conditions
of this offering are not satisfied, it is possible that a creditor
could attach your subscription which could preclude or delay the
return of money to you. If that happens, you will lose your
investment and your funds will be used to pay
creditors.
BECAUSE OUR SOLE OFFICER AND DIRECTOR WHO IS ALSO OUR SOLE PROMOTER,
WILL OWN 80% OF OUR TOTAL OUTSTANDING COMMON STOCK IF THE MINIMUM
AMOUNT OF THE OFFERING IS SOLD AND 67% OF OUR TOTAL OUTSTANDING
COMMON STOCK IF THE MAXIMUM AMOUNT OF THE OFFERING IS SOLD, HE WILL
RETAIN CONTROL OF US AND WILL BE ABLE TO DECIDE WHO WILL BE
DIRECTORS AND YOU MAY NOT BE ABLE TO ELECT ANY DIRECTORS WHICH COULD
DECREASE THE PRICE AND MARKETABILITY OF OUR SHARES.
Even if we sell all 2,000,000 shares of common stock in this
offering, Qing Feng Lu will own 66.67% of the total outstanding
common stock; if the minimum amount of the offering is sold he will
own 80% of the total outstanding common stock. As a result, after
completion of this offering, regardless of the number of shares we
sell, Mr. Lu will be able to elect all of our directors and control
our operations, which could decrease the price and marketability of
our shares.
BECAUSE THERE IS NO PUBLIC TRADING MARKET FOR OUR COMMON STOCK, YOU
MAY NOT BE ABLE TO RESELL YOUR STOCK.
There is currently no public trading market for our common stock.
Therefore there is no central place, such as stock exchange or
electronic trading system, to resell your shares. If you want to
resell your shares, you will have to locate a buyer and negotiate
your own sale.
BECAUSE THE SEC IMPOSES ADDITIONAL SALES PRACTICE REQUIREMENTS ON
BROKERS WHO DEAL IN OUR SHARES THAT ARE PENNY STOCKS, SOME BROKERS
MAY BE UNWILLING TO TRADE THEM. THIS MEANS THAT YOU MAY HAVE
DIFFICULTY RESELLING YOUR SHARES AND THIS MAY CAUSE THE PRICE OF OUR
SHARES TO DECLINE.
6
Our shares would be classified as penny stocks and are covered by
Section 15(g)of the Securities Exchange Act of 1934 and the rules
promulgated there under which impose additional sales practice
requirements on brokers/dealers who sell our securities in this
offering or in the aftermarket. For sales of our securities, the
broker/dealer must make a special suitability determination and
receive from you a written agreement prior to making a sale for you.
Because of the imposition of the foregoing additional sales
practices, it is possible that brokers will not want to make a
market in our shares. This could prevent you from reselling your
shares and may cause the price of our shares to decline.
FINRA SALES PRACTICE REQUIREMENTS MAY LIMIT A STOCKHOLDER'S ABILITY
TO BUY AND SELL OUR STOCK.
The FINRA has adopted rules that require that in recommending an
investment to a customer, a broker-dealer must have reasonable
grounds for believing that the investment is suitable for that
customer. Prior to recommending speculative low priced securities to
their non-institutional customers, broker-dealers must make
reasonable efforts to obtain information about the customer's
financial status, tax status, investment objectives and other
information. Under interpretations of these rules, FINRA believes
that there is a high probability that speculative low priced
securities will not be suitable for at least some customers. FINRA
requirements make it more difficult for broker-dealers to recommend
that their customers buy our common stock, which may have the effect
of reducing the level of trading activity and liquidity of our
common stock. Further, many brokers charge higher transactional fees
for penny stock transactions. As a result, fewer broker-dealers may
be willing to make a market in our common stock, which may limit
your ability to buy and sell our stock.
WE WILL BE REQUIRED TO OBTAIN AN INTERNET CONTENT PROVIDER LICENSE
ONCE OUR OPERATION IS READY TO COMMENCE. WE MIGHT ALSO BE REQUIRED TO
OBTAIN OTHER SPECIAL LICENSES, OR MEET SPECIAL REGULATORY REQUIREMENTS
BEFORE ESTABLISHING OUR BUSINESS, OTHER THAN A BUSINESS LICENSE. IF
NEW GOVERNMENT REGULATIONS, LAWS, OR LICENSING REQUIREMENTS ARE
PASSED THAT WOULD RESTRICT OR ELIMINATE DELIVERY OF ANY OF OUR
INTENDED SERVICES THEN OUR BUSINESS MAY SUFFER.
If we were not able to obtain the Internet Content Provider License
or obtain any other special licenses and or not able to qualify for
other special regulatory requirements for the purpose of opening
our web service, before establishing our business, then our business
would suffer.
USE OF PROCEEDS
Our offering is being made in a direct public offering, without any
involvement of underwriters or broker-dealers, 1,000,000 common
shares minimum, 2,000,000 common shares maximum basis. The table
below sets forth the use of proceeds if 1,000,000 or 2,000,000
common shares of the offering are sold.
1,000,000 2,000,000
------- ---------
Gross proceeds $ 10,000 $ 20,000
Offering expenses $ 5,000 $ 5,000
Net proceeds $ 5,000 $ 15,000
The net proceeds will be used as follows:
Website development $ 1,000 $ 3,000
Marketing and advertising $ 500 $ 3,000
Equipment $ 1,000 $ 3,000
Legal, Audit,
accounting and filing fees $ 2,000 $ 5,000
Other expenses $ 500 $ 1,000
TOTAL $ 5,000 $ 15,000
7
The proceeds from the offering will allow us to operate for twelve
months, whether the minimum or maximum amount is raised. Qing Feng
Lu our sole officer and director determined that the funds would
last twelve months, including filing reports with the Securities and
Exchange Commission as well as the business activities contemplated
by our business plan.
To operate for the next twelve months, the business must receive a
minimum of $5,000 in net proceeds from the sale of common shares.
With the minimum net proceeds of $5,000 we are able to build the
basis of our operations; however, in a smaller scale. Our
anticipated expenditures will be lower in the event that we sell our
minimum offering of 1,000,000 common shares relative to our sale of
2,000,000 shares as illustrated in our table above. If we receive
the maximum funding for $15,000 in net proceeds, we anticipate
greater spending to access our markets.
The total offering expense, regardless of whether the maximum or
minimum amount is raised, will be $5,000, which will be paid
immediately after the offering. This is a onetime offering expense
that will not re-occur unless we pursue another share offering in
the future.
After the completion of this offering, we intend to initiate the
development of our website "WWW.FLEXCAPITAL.CN" We intend to hire an
outside web designer to assist us in designing and building our
website. The cost of establishing a web site is estimated to be
between $1,000 to $3,000.
Marketing and advertising will be focused on promoting our web
service, advertising in local newspapers, magazines, city
billboards, online, etc. To market and advertise our service we
anticipate our expenditures to be between $500 to $3,000.
We estimate our legal, auditing, accounting and filing fees,
we will pay, be between $2,000 to $5,000 during the next twelve
months. Legal, auditing, accounting and filing fees, we will pay,
will vary depending on the amount raised. If the offering raises
the maximum amount, we anticipate greater spending on business
activities illustrated on the table. These spending will increase
the frequency of our cash transactions, as well as negotiations.
Consequently, with more activities during our 12 month operations,
fees will incrementally increase. We expect to pay all of the
legal, auditing, accounting and filing fees that we owe regardless
of the amount raised, but we expect such fees to be higher in the
event that we raise the maximum amount.
We have allocated between $500
and $1,000 for additional unforeseen expenses which may arise as
a result of initiating our operations.
In any event whether we raise the minimum or maximum, we will
have the sufficient amount to proceed with our operations. The
variance in our anticipated expenditures will not be below
$5,000 or exceed $15,000. In total, the company's expenditures,
excluding the initial offering expense, will be between $5,000
to $15,000.
DETERMINATION OF OFFERING PRICE
The price of the shares we are offering was arbitrarily determined
in order for us to raise a minimum of $10,000 and a maximum of
$20,000 in this offering. The offering price bears no relationship
to our assets, earnings, book value or other criteria of value.
Among the factors we considered were:
* our lack of operating history;
* the proceeds to be raised by the offering;
* the amount of capital to be contributed by purchasers in
this offering in proportion to the amount of stock to be retained by
our existing stockholder; and
* our relative cash requirements.
DILUTION OF THE PRICE YOU PAY FOR YOUR SHARES
Dilution represents the difference between the offering price and
the net tangible book value per share immediately after completion
of this offering. Net tangible book value is the amount that results
from subtracting total liabilities and intangible assets from total
assets. Dilution arises mainly as a result of our arbitrary
determination of the offering price of our shares being offered.
Dilution of the value of our shares you purchase is also a result of
the lower book value of our shares held by our existing
stockholders. As of December 31, 2010, the net tangible book value of
our shares of common stock was approximately ($0.00) per share based
upon 4,000,000 shares outstanding.
8
IF 100% OF THE SHARES ARE SOLD:
Upon completion of this offering, in the event all of our shares are
sold, the net tangible book value of the 6,000,000 shares to be
outstanding will be $15,000 or approximately $0.0025 per share. The
net tangible book value of our shares held by our existing
stockholder will be increased by $0.0025 per share without any
additional investment on their part. You will incur an immediate
dilution from $0.01 per share to $0.0025 per share
After completion of this offering, if 2,000,000 shares are sold, you
will own 33% of the total number of outstanding shares for which you
will have made a cash investment of $20,000, or $0.01 per share. Our
existing stockholders will own 67% of the total number of
outstanding shares for which they have made cash contributions
totaling $nil or approximately $0.00 per share.
IF 75% OF THE SHARES ARE SOLD:
Upon completion of this offering, in the event 75% of the shares are
sold, the net tangible book value of the 5,500,000 shares then
outstanding will be $10,000, or approximately $0.0018 per share. The
net tangible book value of our shares held by our existing
stockholders will be increased by $0.0018 per share without any
additional investment on their part. You will incur an immediate
dilution from $0.01 per share to $0.0018 per share.
After completion of this offering, if 1,500,000 shares are sold, you
will own approximately 27% of the total number of outstanding shares
for which you will have made a cash investment of $15,000, or $0.01
per share. Our existing stockholders will own approximately 73% of
the total number of outstanding shares for which they have made cash
contributions totaling nil or approximately $0.00 per share.
IF THE MINIMUM NUMBER OF SHARES IS SOLD:
Upon completion of this offering, in the event 50% or the minimum
amount of shares are sold, the net tangible book value of the
5,000,000 shares to be outstanding will be $5,000, or approximately
$0.001 per share. The net tangible book value of the shares held by
our existing stockholders will be increased by $0.001 per share
without any additional investment on their part. You will incur an
immediate dilution from $0.01 per share to $0.001 per share.
After completion of this offering, if 1,000,000 shares are sold, you
will own approximately 20% of the total number of outstanding shares
for which you will have made a cash investment of $10,000, or $0.01
per share. Our existing stockholders will own approximately 80% of
the total number of outstanding shares for which they have made cash
contributions totaling nil or approximately $0.00 per share.
The following table compares the differences of your investment in
our shares with the investment of our existing stockholders.
9
EXISTING STOCKHOLDERS IF ALL OF THE SHARES ARE SOLD:
Price per share $ 0.00000
Net tangible book value per share before offering $ (0.000)
Potential gain to existing shareholders $ 20,000
Net tangible book value per share after offering $ 0.0025
Increase to present stockholders in net tangible book
value per share after offering $ 0.0025
Capital contributions $ 0
Number of shares outstanding before the offering 4,000,000
Number of shares after offering assuming the sale of the maximum
number of shares 6,000,000
Percentage of ownership after offering 67%
PURCHASERS OF SHARES IN THIS OFFERING IF ALL SHARES SOLD
Price per share $ 0.01
Dilution per share $ 0.0025
Capital contributions $ 20,000
Number of shares after offering held by public investors 2,000,000
Percentage of capital contributions by existing shareholder 0.00%
Percentage of capital contributions by new investors 100%
Percentage of ownership after offering 33%
PURCHASERS OF SHARES IN THIS OFFERING IF 75% OF SHARES SOLD
Price per share $ 0.01
Dilution per share $ 0.0018
Capital contributions $ 15,000
Number of shares after offering held by public investors 1,500,000
Percentage of capital contributions by existing shareholders 0.000%
Percentage of capital contributions by new investors 100%
Percentage of ownership after offering 27%
PURCHASERS OF SHARES IN THIS OFFERING IF 50% OF SHARES SOLD
Price per share $ 0.01
Dilution per share $ 0.001
Capital contributions $ 10,000
Number of shares after offering held by public investors 1,000,000
Percentage of capital contributions by existing shareholders 0.000%
Percentage of capital contributions by new investors 100.0%
Percentage of ownership after offering 20%
10
PLAN OF DISTRIBUTION; TERMS OF THE OFFERING
We are offering up to 2,000,000 shares of common stock on a
self-underwritten basis, 1,000,000 shares minimum, 2,000,000 shares
maximum. The offering price is $0.01 per share. Funds from this
offering will be placed in a separate bank account at US Bank, 2385
North Oxnard Blvd, Oxnard, CA, 93136, Tel: 805 604 2200. The funds
will be maintained in a separate bank until we receive a minimum of
$10,000 at which time we will remove those funds and use the same as
set forth in the Use of Proceeds section of this Prospectus. This
account is not an escrow, trust or similar account. Your
subscription will only be deposited in a separate bank account under
our name. As a result, if we are sued for any reason and a judgment
is rendered against us, your subscription could be seized in a
garnishment proceeding and you could lose your investment, even if
we fail to raise the minimum amount in this offering. As a result,
there is no assurance that your funds will be returned to you if the
minimum offering is not reached. Any funds received by us thereafter
will immediately used by us. If we do not receive the minimum amount
of $10,000 within 270 days of the effective date of our registration
statement, all funds will be promptly returned to you without a
deduction of any kind. During the 270 day period, no funds will be
returned to you. You will only receive a refund of your subscription
if we do not raise a minimum of $10,000 within the 270 day period
referred to above. There are no finders involved in our
distribution. Officers, directors, affiliates or anyone involved in
marketing our shares will not be allowed to purchase shares in the
offering. You will not have the right to withdraw your funds during
the offering. You will only have the right to have your funds
returned if we do not raise the minimum amount of the offering or if
there is a material change in the terms of the offering.
The following are material changes that would entitle you to a
refund of your money:
* an extension of the offering period beyond 270 days;
* a change in the offering price;
* a change in the minimum sales requirement;
* a change to allow sales to affiliates in order to meet the
minimum sales requirement; or
* a change in the amount of proceeds necessary to release
the funds held in the separate bank account.
Funds will be returned promptly in the event that these changes
occur.
We will sell the shares in this offering through Mr. Lu, our sole
officer and director. He will not receive a commission from the sale
of any shares. He will not register as a broker-dealer under section
15 of the Securities Exchange Act of 1934 in reliance upon Rule
3a4-1. Rule 3a4-1 sets forth those conditions under which a person
associated with an issuer may participate in the offering of the
issuer's securities and not be deemed to be a broker/dealer. The
conditions are that:
1. The person is not statutorily disqualified, as that term is
defined in Section 3(a)(39) of the Act, at the time of his
participation; and,
2. The person is not compensated in connection with his
participation by the payment of commissions or other remuneration
based either directly or indirectly on transactions in securities;
3. The person is not at the time of their participation, an
associated person of a broker/dealer; and,
11
4. The person meets the conditions of Paragraph (a)(4)(ii) of
Rule 3a4-1 of the Exchange Act, in that he (A) primarily performs,
or is intended primarily to perform at the end of the offering,
substantial duties for or on behalf of the Issuer otherwise than in
connection with transactions in securities; and (B) is not a broker
or dealer, or an associated person of a broker or dealer, within the
preceding twelve months; and (C) does not participate in selling and
offering of securities for any Issuer more than once every twelve
months other than in reliance on Paragraphs (a)(4)(i) or (a)(4)(iii).
Mr. Lu is not statutorily disqualified, is not being compensated,
and is not associated with a broker/dealer. He is and will continue
to be our sole officer and director at the end of the offering and
has not been during the last twelve months and is currently not a
broker/dealer or associated with a broker/dealer. He will not
participate in selling and offering securities for any issuer more
than once every twelve months.
Only after our registration statement is declared effective by the
SEC, do we intend to advertise, through tombstones, and hold
investment meetings in various states where the offering will be
registered. We will not utilize the Internet to advertise our
offering. Mr. Lu will also distribute the prospectus to potential
investors at meetings, to business associates and to his friends and
relatives who are interested in a possible investment in the
offering. No shares purchased in this offering will be subject to
any kind of lock-up agreement.
Management and affiliates thereof will not purchase shares in this
offering to reach the minimum. We intend to sell our shares outside
of the United States.
SECTION 15(g) OF THE EXCHANGE ACT - PENNY STOCK RULES
The SEC has adopted rules that regulate broker-dealer practices in
connection with transactions in penny stocks. Penny stocks are
generally equity securities with a price of less than $5.00 (other
than securities registered on certain national securities exchanges
or quoted on the OTC Bulletin Board system, provided that current
price and volume information with respect to transactions in such
securities is provided by the exchange or system).
The penny stock rules require a broker-dealer, prior to a
transaction in a penny stock not otherwise exempt from those rules,
deliver a standardized risk disclosure document prepared by the SEC,
which:
* contains a description of the nature and level of risk in
the market for penny stocks in both public offerings and secondary
trading;
* contains a description of the broker's or dealer's duties
to the customer and of the rights and remedies available to the
customer with respect to a violation to such duties or other
requirements;
* contains a brief, clear, narrative description of a dealer
market, including "BID" and "ASK" prices for penny stocks and the
significance of the spread between the bid and ask price;
* contains a toll-free telephone number for inquiries on
disciplinary actions;
* defines significant terms in the disclosure document or in
the conduct of trading penny stocks; and
* contains such other information and is in such form
(including language, type, size, and format) as the SEC shall
require by rule or regulation.
12
The broker-dealer also must provide, prior to effecting any
transaction in a penny stock, the customer:
* with bid and offer quotations for the penny stock;
* the compensation of the broker-dealer and its salesperson
in the transaction;
* the number of shares to which such bid and ask prices
apply, or other comparable information relating to the depth and
liquidity of the market for such stock; and
* monthly account statements showing the market value of
each penny stock held in the customer's account.
In addition, the penny stock rules require that prior to a
transaction in a penny stock not otherwise exempt from those rules;
the broker-dealer must make a special written determination that the
penny stock is a suitable investment for the purchaser and receive
the purchaser's written acknowledgment of the receipt of a risk
disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability
statement.
These disclosure requirements will have the effect of reducing the
trading activity in the secondary market for our securities because
it will be subject to these penny stock rules. Therefore, security
holders may have difficulty
selling those securities.
REGULATION M
Our sole officer and director, who will sell the shares, is aware
that he is required to comply with the provisions of Regulation M,
promulgated under the Securities and Exchange Act of 1934, as
amended. With certain exceptions, Regulation M precludes officers
and/or directors, sales agents, any broker-dealers or other person
who participate in the distribution of shares in this offering from
bidding for or purchasing, or attempting to induce any person to bid
for or purchase any security which is the subject of the
distribution until the entire distribution is complete.
OFFERING PERIOD AND EXPIRATION DATE
This offering will start on the date that this registration
statement is declared effective by the SEC and continue for a period
of 270 days, or sooner if the offering is completed or otherwise
terminated by us.
We will not accept any money until this registration statement is
declared effective by the SEC.
PROCEDURES FOR SUBSCRIBING
We will not accept any money until this registration statement is
declared effective by the SEC. Once the registration statement is
declared effective by the SEC, if you decide to subscribe for any
shares in this offering, you must:
1. Execute and deliver a subscription agreement, a copy of
which is included with the prospectus; and
2. Deliver a check, wire transfer, bank draft or money order to
us for acceptance or rejection.
All checks for subscriptions must be made payable to "FLEX CAPITAL
CORPORATION".
RIGHT TO REJECT SUBSCRIPTIONS
We have the right to accept or reject subscriptions in whole or in
part, for any reason or for no reason. All monies from rejected
subscriptions will be returned immediately by us to the subscriber,
without interest or deductions. Subscriptions for securities will be
accepted or rejected within 48 hours after we receive them.
13
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
OR PLAN OF OPERATION
This section of the prospectus includes a number of forward-looking
statements that reflect our current views with respect to future
events and financial performance. Forward-looking statements are
often identified by words like: believe, expect, estimate,
anticipate, intend, project and similar expressions, or words which,
by their nature, refer to future events. You should not place undue
certainty on these forward-looking statements, which apply only as
of the date of this prospectus. 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.
We are a development stage corporation and have not started
operations and have not yet generated or realized any revenues.
Our auditors have issued a going concern opinion. This means that
our auditors believe there is substantial doubt that we can continue
as an on-going business for the next twelve months unless we obtain
additional capital to pay our bills. This is because we have not
generated any revenues and no revenues are anticipated until we
complete the development of our website and begin
implementing and marketing our web service to our target markets. We
believe the technical aspects of our website will be sufficiently
developed to use for our operations within 90 days from the
completion of our offering. Accordingly, we must raise cash from
sources other than operations. Our only other source for cash at
this time is investments by others in our company. We must raise
cash to implement our project and begin our operations. Whether we
raise the minimum or maximum amount of money in this offering, it
will last twelve months.
The difference between the minimum and maximum amount relates to the
website development; marketing and advertising; equipment and office
furniture; and hiring one employee. In each case, if we raise the
maximum amount, we will devote more funds to the same in order to
enhance the quality of the website and promote our business plan to
potential customers. We will not begin operations until we raise
money from this offering.
We have only one officer and director. He is responsible for our
managerial and organizational structure which will include
preparation of disclosure and accounting controls under the Sarbanes
Oxley Act of 2002. When these controls are implemented, he will be
responsible for the administration of the controls. Should he not
have sufficient experience, he may be incapable of creating and
implementing the controls which may cause us to be subject to
sanctions and fines by the SEC which ultimately could cause you
to lose your investment.
PLAN OF OPERATION
Assuming we raise the minimum amount in this offering, we believe we
can satisfy our cash requirements during the next 12 months. We will
not be conducting any product research or development. We do not
expect to purchase any significant equipment. Further we do not
expect significant changes in the number of employees.
Upon completion of our public offering, our goal is to commence our
operations. We intend to accomplish the foregoing through the
following milestones: (You may also refer to our "Use of
Proceeds" section)
1. Complete our public offering. We believe that we will
raise sufficient capital to begin our operations, and we believe
that this could take up to 270 days from the date the Securities and
Exchange Commission declares our offering effective. We will not
begin operations until we have closed this offering. We intend to
concentrate all of our efforts on raising as much capital as we can
during this period. Once the offering is completed we will make a
one-time payment approximately $5,000 under offering expenses.
14
2. After completion of the offering, we will immediately
begin to develop our website. First, we will purchase all necessary
equipments to support our operations. Equipments necessary for our
operations are general technical machineries such as computers
and network devices. Equipments will cost between $1,000 to $3,000.
With equipments in place, we believe that our website can be
fully operational within 90 days. During this 90 day period we will
expense between $1,000 to $3,000 to develop our website. Additional
details are available under the "Business" section.
Concurrently, while we are still in our development stage, Mr. Lu
will continue contacting with businesses to not only be enlisted on
our website, but also to provide data to share with end-users. We expect
to incur costs between $500 to $1,000 to negotiate and discuss our
proposed plan to potential customers who wish to be enlisted on our
website.
Finally, Mr. Lu will apply for the Internet Content Provider license,
which will take approximately 20 days for approval and free of charge
Total costs to our business during our first 90 days are between
$2,500 to $7,000.
3. Once our website is fully operational, and has listed a
reasonable amount of business onto our website, approximately 90 days
after the effective date, we will launch our website. We will offer our
proposed services to users during this time while listing more business
onto the website. Additionally we will begin to market our business to
potential customers, end-users, and investors through our website, as
well as other marketing channels mentioned under the "marketing" section.
Our marketing activities will span over nine months and are expected to
costs between $500 to $3,000.
By the time we reach our 12 months of operation our costs which include
legal, auditing, accounting and filing fees, and less offering expenses,
we will be approximately between $5,000 to $15,000, which is the minimum
or maximum amount raised through this offering.
4. Immediately after the 12 month period, our sole officer will
begin selling advertising space to related stakeholders. At this time
our business may seek additional funding or loans from our officer to
cover expenses that may incur after the 12 month period. There are
no specific arrangements in place pursuant to which our sole officer
and director has agreed to advance funds to the Company. However,
we expect positive cash flow at this time.
Within 90 days after we complete our public offering, we should be
in the position to establish our first web service. If we cannot
generate sufficient revenues to continue operations, we will suspend
or cease operations. If we cease operations, we do not know what we
will do and we do not have any plans to do anything else.
LIMITED OPERATING HISTORY; NEED FOR ADDITIONAL CAPITAL
There is no historical financial information about us upon which to
base an evaluation of our performance. We are in development stage
operations and have not yet generated any revenues. We cannot
guarantee we will be successful in our business operations. Our
business is subject to risks inherent in the establishment of a new
business enterprise, including limited capital resources and
possible cost overruns.
In addition to this offering, we are seeking equity financing in
order to obtain the capital required to implement our business plan.
We have no assurance that future financing will be available to us
on acceptable terms. If financing is not available to us on
satisfactory terms, we may be unable to continue, develop or expand
our operations. Equity financing could result in additional dilution
to our existing shareholders.
RESULTS OF OPERATIONS
FROM INCEPTION ON OCTOBER 27, 2009 TO DECEMBER 31, 2010
During this period we incorporated the company, and hired an auditor
for the preparation of this registration statement. We also prepared
an internal business plan. Our loss since inception is 4,000. We
have not yet started our proposed business operations and will not
do so until we have completed this offering. We expect to begin
operations within 120 days after we complete this offering.
Since inception, we have issued 4,000,000 shares of common stock to
our sole officer and director.
15
LIQUIDITY AND CAPITAL RESOURCES
To meet our need for cash we are attempting to raise money from this
offering. We believe that we will be able to raise enough money
through this offering to begin operations but we cannot guarantee
that once we begin operations we will stay in business after
operations have commenced. If we are unable to successfully attract
customers to utilize our web service, we may use up the proceeds
from this offering and will need to find alternative sources, like a
second public offering, a private placement of securities, or loans
from our officers or others in order for us to continue our
operations. At present, we have not made any arrangements to raise
additional capital, other than through this offering.
Our sole officer and director is willing to loan us money for our
operations if necessary. There are no specific arrangements in
place pursuant to which our sole officer and director has agreed to
advance funds to the Company. If we need additional capital and
cannot raise it we will either have to suspend operations until we
do raise the capital or cease operations entirely. If we raise the
minimum amount of money from this offering, it will last one year.
Other than as described in this paragraph, we have no other financing
plans.
As of the date of this prospectus, we have yet to generate any
revenues from our business operations.
We issued 4,000,000 shares of common stock pursuant to an exemption
from registration contained in Regulation S of the General Rules and
Regulations promulgated under the Securities Act of 1933. This was
accounted for as a sale of common stock.
As of March 31, 2011 , our total assets were $0 and our total
liabilities were $0.
BUSINESS
GENERAL
We were incorporated in the State of Nevada on October 27, 2009. We
have not started operations. We are developing a website
WWW.FLEXCAPITAL.CN. In the beginning of our business operations, we
plan to advertise our business on the internet that will promote our
business.
We have not yet generated any revenues and the only operations that
we have engaged in is the development of a business plan. Our
business office is located at Room 1707 Unit C, 17th Floor, CTS
Center, 219 Zhong Shan Wu Road, Guangzhou, China, 50030. Our
telephone number is
86-13808821282. This office space is provided by Mr. Lu's business
associate.
We have no plans to change our planned business activities or to
combine with another business, and we are not aware of any events or
circumstances that might cause these plans to change. We have no
intention, plan or agreement to be merged with or be acquired by any
operating company, to be entered into a change of control, or to
change the management of the company.
We have not yet begun operations and will not begin operations until
we have completed this offering. Our plan of operation is forward
looking and there is no assurance that we will ever begin operations.
We have not conducted any market research into the likelihood of
success of our operations or the acceptance of our products or
advisory services by the public. Although we have not conducted
any marketing research regarding the potential of this business, we
recognize the growing opportunity to offer industry specific
information in China to maximize users' efficiency. Consumers in
China are continuously seeking efficient alternatives to reduce
waste and maximize resources.
16
OUR STRATEGY
We intend to create a website that will be a search engine for various
transportation providers for the public. Users at no cost will be able to
come to our website to look up various local transportation businesses such
as: Fast food deliveries, bus routes, subway routes, taxi companies, and
couriers are just a few examples. Currently, we do not have any customers or
any contracts for our service. We also have not yet commenced any operations.
Our website will allow end-users to isolate their search criteria in regards
to product, price, location, date and time, etc. Once end-users have selected
and submitted their search, a list of appropriate providers will be populated.
Providers listed on our website will have a direct linkage onto their website
allowing more convenience for end-users to carry out further research regarding
services.
Potential businesses must agree to be listed on our website so that we can
access information, and provide an efficient search alternative for our end
users. Our product and service add value by assisting end users to efficiently
locate and track businesses. We will actively market our services to drive
end-user to visit our website. Ultimately, we are creating advertising medium
for our clients to promote their businesses.
Once we have generated traffic to our website, we will sell advertising
space on our website to our clients. Our payment options are either credit
card or cash. Cash payments are made either in person at the office or through
online internet money transfers.
TARGET MARKET
Our web portal functions to link with other business websites. In our first
year operation, we plan to open our web portal. Our services will be focused
in the Guangdong Province to accommodate a general growing demand for both
effective and efficient services. To maximize our resources and establish
economies of scale, our business will develop regionally starting
with Shenzhen.
Our targeted end-user audience is busy working individuals seeking new search
alternatives to maximize their daily utility. As we attract more users to
our website, businesses will recognize the potential to advertise on our
website.
To maintain focus, our advertisement spaces will be offered to businesses
that are aligned with our strategies, but not necessarily listed on our
website. We will market our advertising space to strictly transportation
providers, as mentioned on the above section, primarily for the general public.
COMPETITIVE CONDITIONS
We currently have no operation. The industry is dominated by large players
that offer similar search services. The company will compete for market share
with other search engines in China; however, our portal focuses on delivery and
transportation services. While large players maintain a broad focus to capture
the mass market, we differentiate our product and concentrate on transportation
searches. As well, our targeted paying clients are strictly transportation
providers.
We compete with large players to capture market share of broad base users;
however, our differentiated service is viable as it is positioned to target
only specific end-users and businesses. There are end-users and businesses
that are seeking for efficient applications and an industry focused medium to
advertise on. Our strategies differentiate our services to appeal to, and add
value for, our targets
Services that we offer could potentially be blocked or censored if we are to
violate any state regulations. We are not aware of any government regulations
that pertain to our industry.
REGULATORY REQUIREMENTS
Our business is required to obtain the Internet Content Provider license to
operate legally in China.
MARKETING
Initially, our services will be promoted by Mr. Lu. He will discuss our
services with his friends and business associates. In addition to our
website, we also anticipate utilizing other marketing avenues in our attempt
to make our services known to the general public and attract potential
customers. These marketing activities will be designed to inform potential
customers about the benefits of using our services and may include the
following: development and distribution of marketing literature; direct mail
and email advertising; billboards advertisement and, promotion of our
website. The suggested marketing tools will be directed to transportation
businesses and end-users seeking such services.
Depending on the amount raised through this offering, we have allocated between
$500 to $3,000 to employ our marketing and advertising initiatives. The
capital employed will be strictly on a variable basis until we begin
generating revenues. Advertisement costs will incur only when our message
is distributed through the channels suggested.
If we raise the minimum amount of $5,000 in net proceeds, our promotional
initiatives will be limited to email advertisements, as well as to a short list
of online advertisers. We will expense $500 over a nine month period,
immediately after completing our website, to advertise our business offering
in various local websites.
In the event that we raise the maximum amount of $15,000 in net proceeds, our
business will be advertised using the proposed methods stated in the above.
The following is a break-down of the $3,000 allocated for marketing and
advertising:
1. $1,500 over a nine month period on billboards in Shenzhen.
2. $500 over a nine month period on a variety of online space with significant
penetration to our targeted end-users.
3. $500 to contract a professional writer to complete our marketing literature.
4. $500 over a nine month period to mass mail and email potential end-users and
businesses.
Our website is our primary advertisement unit to educate our business offering
to end-users. Our website development costs are expected to be between $1,000
to $3,000 over the next three months. Our website development will be
contracted to professional developers and will include the following
1. Business and needs assessments.
2. Website development focused on functionality for primary end-user needs and
basic literature.
3. Website development focused on cosmetic and persuasive content. Applicable
in the event that
we raise the maximum amount through offering.
Our website completion date is approximately 90 days after the effective date.
Once our website is completed, we will deploy our proposed marketing and
advertising activities and will commence for 9 months.
REVENUE
We intend to generate revenues by selling advertising on our website. Therefore,
we will require substantial start-up capital in order to setup our web service
and begin operations. Qing Feng Lu, our president, will be devoting
approximately 20 hours a week of his time to our operations. Once we begin
operations Mr.Lu has agreed to commit more time as required. Because Mr.
Lu will only be devoting limited time to our operations, our operations may
be sporadic and occur at times which are convenient to Mr. Lu. As a result,
operations may be periodically interrupted or suspended which could result
in a lack of revenues and a cessation of operations.
In the beginning, our revenue model is strictly based on an advertisement
scheme. Clients advertising on our website may choose to purchase a gold,
silver or copper option. The options will determine the advertisement price,
size, location, and function such as optimization. Our options will be
priced in the range of $75 to $350 per month
We expect to generate revenue once operations are fully functional after the 12
month period. We have dedicated our initial 12 months towards the development
and marketing of our business to stakeholders to generate user volume. Because
we do not anticipate positive cash flow before the 12 month development period,
our burn rate is approximately $416 to 1,250 each month in the event that we
raise the minimum or maximum amount, respectively.
EMPLOYEES; IDENTIFICATION OF CERTAIN SIGNIFICANT EMPLOYEES
We are a development stage company and currently have no employees, other than
our sole officer and director. We intend to hire additional employees when they
are needed.
OFFICES
Our office has been arranged by our president free of rent. The office is
currently located at Room 1707, Unit C, 17th Floor CTS Center 219 Zhong Shan
Wu Road,Guangzhou, China,. Our telephone number is 86-13808821282.
17
MANAGEMENT
OFFICERS AND DIRECTORS
Our sole director will serve until his successor is elected and
qualified. Our sole officer is elected by the board of directors to
a term of one year and serves until his successor is duly elected
and qualified, or until he is removed from office. Our board of
directors has no nominating, auditing or compensation committees.
The name, address, age and position of our sole officer and director
is set forth below:
Name and Address Age Positions
---------------- --- ---------
Qing Feng Lu 28 President, Chief Executive Officer, Secretary,
Room 1707 Unit C, Treasurer, Chief Financial Officer, and the
219 Zhong Shan Wu Road sole member of the Board of Directors
Guangzhou, China
510030
The person named above has held his offices/positions since the
inception of our company and is expected to hold his
offices/positions until the next annual meeting of our stockholders.
BACKGROUND OF OUR SOLE OFFICER AND DIRECTOR
QING FENG LU - PRESIDENT, CHIEF EXECUTIVE OFFICER, SECRETARY,
TREASURER, CHIEF FINANCIAL OFFICER, PRINCIPAL ACCOUNTING OFFICER AND
OUR SOLE DIRECTOR.
Since January 23, 2009, Mr. Lu has been our President, Chief
Executive Officer, Secretary, Treasurer, Chief Financial Officer,
Principal Accounting Officer and sole member of our Board of
Directors. From 2000-2004 Mr. Lu obtained his Degree in Computer
Science, University of Jilin. From 2005-present he has worked as a
Web Developer at Shen Da Technology Ltd in Luohu District, Shenzhen,
Guangdong, China. Shen Da Technology is an internet solutions
provider specializing in web design, hosting, promoting, marketing
and software development.
AUDIT COMMITTEE FINANCIAL EXPERT
The functions of the Audit Committee are currently carried out by
our Board of Directors. Our Board of Directors has determined that
we do not have an audit committee financial expert on our Board of
Directors carrying out the duties of the Audit Committee. The Board
of Directors has determined that the cost of hiring a financial
expert to act as a director and to be a member of the Audit
Committee or otherwise perform Audit Committee functions outweighs
the benefits of having a financial expert on the Audit Committee.
CONFLICTS OF INTEREST
Mr. Lu devotes approximately 20 hours per week to our Company. The
only conflict that exists is Mr. Lu's devotion of time to other
projects. We have no provisions for handling conflicts of interest
should they arise in the future; however, Mr. Lu has agreed not to
engage in any business activity which conflicts with our activities.
18
EXECUTIVE COMPENSATION
The following table sets forth the compensation paid by us from
inception on October 27, 2009, through December 31, 2010, for our sole
officer and director. This information includes the dollar value of
base salaries, bonus awards and number of stock options granted,
and certain other compensation, if any.
SUMMARY COMPENSATION TABLE
Annual Compensation Long-Term Compensation
-------------------------- -------------------------
Awards Payouts
------ -------
Change in
Names Non-equity pension value Other
Executive Option incentive and nonqualified
Officer and Stock awards plan deferred Compen-
Principal Salary Bonus awards Compensation Compensation sation Total
Position Year (US$) (US$) (US$) (#) (US$) earnings ($) (US$) (US$)
--------- ---- ------ ----- ------ ------- ----------- ------- ------ ------
Qing Feng
Lu 2010 0 0 4,000 0 0 0 0 4,000
President,
Secretary/Treasurer,
Director
Qing Feng
Lu 2009 0 0 4,000 0 0 0 0 4,000
President,
Secretary/Treasurer,
Director
We do not have any employment agreements with any of our officers.
We do not contemplate entering into any employment agreements until
such time as we begin to attain profitable operations. We do not know if
Mr. Lu will stay with the organization for the next twelve months.
The compensation discussed herein addresses all compensation awarded
to, earned by, or paid to our named executive officer. We have
issued 4,000,000 common shares at $0.001 per share to our sole
officer and director in exchange for his services. Mr. Lu will
implement our business strategies specified in our business plan.
Additionally, Mr. Lu will manage all facets of our operations for
the next twelve months.
There are no other stock option plans, retirement, pension, or
profit sharing plans for the benefit of our sole officer and
director other than as described herein.
LONG-TERM INCENTIVE PLAN AWARDS
We do not have any long-term incentive plans that provide
compensation intended to serve as incentive for performance.
COMPENSATION OF DIRECTORS
Our sole director does not receive any compensation for serving as a
member of the board of directors.
INDEMNIFICATION OF OFFICERS AND DIRECTORS
Pursuant to Section 607.0850 of the Nevada Statutes, the Registrant has
the power to indemnify any person made a party to any lawsuit by reason
of being a director or officer of the Registrant, or serving at the
request of the corporation as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred
by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe
his conduct was unlawful. Our By-laws provide that the Registrant
shall indemnify its directors and officers to the fullest extent
permitted by Nevada law.
With regard to the foregoing provisions, or otherwise, we have been
advised that in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the
Securities Act of 1933, as amended, and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by us of expenses incurred or paid by a
director, officer or controlling person of the Corporation in the
successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with
the securities being registered, we will, unless in the opinion of
our counsel the matter has been settled by a controlling precedent,
submit to a court of appropriate jurisdiction the question of whether
such indemnification by us is against public policy as expressed in
the Securities Act of 1933, as amended, and will be governed by the
final adjudication of such case.
19
PRINCIPAL STOCKHOLDERS
The following table sets forth, as of the date of this prospectus,
the total number of shares owned beneficially by our directors,
officers and key employees, individually and as a group, and the
present owners of 5% or more of our total outstanding shares. The
table also reflects their ownership assuming the sale of all of the
shares in this offering. The stockholders listed below have direct
ownership of their shares and possesses sole voting and dispositive
power with respect to the shares.
# of % of # of Shares Ownership After
Shares Ownership After Offering the Offering
Name and Address Before the Before the Assuming all of Assuming all of the
Beneficial Owner [1] Offering Offering the Shares are sold Shares are Sold
------------------ -------- -------- --------------- ---------------
Qing Feng Lu 4,000,000 100.00% 6,000,000 66.67%
Room 1707-C,
219 Zhong shan
Wu Road
Guangzhou, China
510030
[1] The person named above may be deemed to be a "parent" and
"promoter" of our company, within the meaning of such terms under
the Securities Act of 1933, as amended, by virtue of his direct
stock holdings. Mr. Lu is the only "promoter" of our company.
20
FUTURE SALES BY EXISTING STOCKHOLDERS
A total of 4,000,000 shares of common stock were issued to our sole
officer and director, all of which are restricted securities, as
defined in Rule 144 of the General Rules and Regulations promulgated
under the Securities Act of 1933. Under Rule 144, since Mr. Lu is
an affiliate as defined in that rule, the shares can be publicly
sold, subject to volume restrictions and restrictions on the manner
of sale, commencing one year after their acquisition.
Shares purchased in this offering, which will be immediately
resalable, and sales of all of our other shares after applicable
restrictions expire, could have a depressive effect on the market
price, if any, of our common stock and the shares we are offering.
There is no public trading market for our common stock. There are no
outstanding options or warrants to purchase, or securities
convertible into, our common stock. There is one holder of record
for our common stock. The record holder is our sole officer and
director and he owns 4,000,000 restricted shares of our common stock.
DESCRIPTION OF SECURITIES
COMMON STOCK
Our authorized capital stock consists of 75,000,000 shares of common
stock, par value $0.001 per share. The holders of our common stock:
* have equal ratable rights to dividends from funds legally
available if and when declared by our board of directors;
* are entitled to share ratably in all of our assets
available for distribution to holders of common stock upon
liquidation, dissolution or winding up of our affairs;
* do not have preemptive, subscription or conversion rights
and there are no redemption or sinking fund provisions or rights;
and
* are entitled to one non-cumulative vote per share on all
matters on which stockholders may vote.
NON-CUMULATIVE VOTING
Holders of shares of our common stock do not have cumulative voting
rights, which means that the holders of more than 50% of the
outstanding shares, voting for the election of directors, can elect
all of the directors to be elected, if they so choose, and, in that
event, the holders of the remaining shares will not be able to elect
any of our directors. After this offering is completed, assuming the
sale of all of our shares of common stock, present stockholders will
own approximately 67% of our outstanding shares.
21
CASH DIVIDENDS
As of the date of this prospectus, we have not paid any cash
dividends to stockholders. The declaration of any future cash
dividend will be at the discretion of our board of directors and
will depend upon our earnings, if any, our capital requirements and
financial position and our general economic condition. It is our
intention not to pay any cash dividends in the foreseeable future,
but rather to reinvest earnings, if any, in our business operations.
PREFERRED STOCK
We do not have a class of preferred stock.
ANTI-TAKEOVER PROVISIONS
There are no Nevada anti-takeover provisions that may have the
affect of delaying or preventing a change in control.
REPORTS
After we complete this offering, we will not be required to furnish
you with an annual report. Further, we will not voluntarily send you
an annual report. We will be required to file reports with the SEC
under section 15(d) of the Securities Act and the reports will be
filed electronically. The reports we will be required to file are
Forms 10-K, 10-Q, and 8-K. You may read copies of any materials we
file with the SEC at the SEC's Public Reference Room at 100 F
Street, N.E., Room 1580, Washington, D.C. 20549. You may obtain
information on the operation of the Public Reference Room by calling
the SEC at 1-800-SEC-0331. The SEC also maintains an Internet site
that will contain copies of the reports we file electronically. The
address for the Internet site is www.sec.gov.
STOCK TRANSFER AGENT
We have not yet selected a stock transfer agent.
CERTAIN TRANSACTIONS
On or about October 27, 2009, we issued a total of 4,000,000
shares of restricted common stock to Qing Feng Lu, our President,
Chief Executive Officer, Principal Accounting Officer, Principal
Financial Officer, Treasurer, Secretary and sole director, in
exchange for his services to us, and those shares were valued at
$0.001 per share for a total value of $4,000. These shares
represent 100% of our issued and outstanding shares. This represents
the complete interest of our sole current shareholder prior to any
future issuance of stock under this registration statement.
Mr. Qing Feng Lu has advanced to the company the amount of $1,250.
This is considered a loan by Mr. Lu and it is a related party transaction.
The loan is not evidenced by any agreement in writing and there are no
terms of repayment or interest stipulated on this loan.
LITIGATION
We are not a party to any pending litigation and none is
contemplated or threatened.
22
EXPERTS
Our financial statements for the period from inception to December
31, 2009, included in this prospectus have been audited by Stan J.H.
Lee, CPA 2160 North Central Rd. Suite 203 Fort Lee NJ 07024 P.O. Box
436402 San Ysidro CA 92143 619-623 as set forth in their report
included in this prospectus. Their report is given upon their
authority as experts in accounting and auditing.
LEGAL MATTERS
We have no legal counsel at this time.
FINANCIAL STATEMENTS
Our fiscal year end is December 31. We will provide audited
financial statements to our stockholders on an annual basis; the
statements will be prepared by Stan J.H. Lee, CPA 2160 North Central
Rd. Suite 203 Fort Lee NJ 07024 P.O. Box 436402 San Ysidro CA 92143
619-623-7799
23
INDEX
Balance Sheet as of
March 31, 2011 ( Unaudited) ..................................... F-2
Statements of Operations for the Period from October
27, 2009 (Inception) Through March 31, 2011 (Unaudited) ....... F-3
Statements of Cash Flows for the Period from October 27,
2009 (Inception) Through March 31, 2011(Unaudited) .................... F-4
Statement of Changes in Stockholders' Deficit for the Period
From October 27, 2009 (Inception) Through March 31, 2011 (Unaudited)
.................................. F-5
Notes to the Financial Statements for the Period From
October 27, 2009 (Inception) Through March 31, 2011 (Unaudited) ........ F-6
24
Flex Capital Corp.
(A Development Stage Company)
Balance Sheet
As of March 31, 2011
March 31, 2011 December 31, 2010
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash $ -- $ --
Total Current Assets $ -- $ --
Total Assets $ -- $ --
======== ========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Advance from Other $ 2,500 $ 1,250
Total Current Liabilities $ 2,500 $ 1,250
-------- --------
Stockholders' Deficit
Common Stock, $0.001 par value,
75,000,000 shares authorized,
4,000,000 issued and outstanding $ 4,000 $ 4,000
Capital Contribution
Deficit accumulated during
development stage (6,500) (5,250)
Total Stockholders' Deficit $ (2,500) $ (1,250)
-------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' DEFICIT $ 0 $ 0
======== ========
(The Accompanying Notes are an Integral Part of These Financial
Statements)
25
F-3
Flex Capital Corp.
(A Development Stage Company)
Statement of Operations
(Unaudited)
For the Period For the period
Ended March from October 27,
31, 2009 (Inception)
2011 to March 31, 2011
Revenues $ -- $ --
Operating Expenses
Professional fees $ 1,250 $ 2,500
Consulting fees $ -- $ 4,000
Total Operating Expenses $ 1,250 $ (6,500)
---------- ----------
Net Loss $ (1,250) $ (6,500)
========== ==========
Net Loss Per Common Share
- Basic and Diluted $ -- $ (0.00)
========== =========
Weighted Average Number of
Common Shares Outstanding
- Basic and Diluted 4,000,000 4,000,000
(The Accompanying Notes are an Integral Part of These Financial
Statements)
26
F-4
Flex Capital Corp.
(A Development Stage Company)
Statement of Cash Flows
(Unaudited)
For the Period For the period
Ended March from October 27,
31, 2011 2009 (Inception)
to March 31, 2011
CASH FLOW FROM OPERATING ACTIVITIES:
Net loss $ (1,250) $ (6,500)
Adjustments to reconcile net loss
from operations to net cash used
in operating activities:
Changes in working capital $ 1,250 $ 2,500
-------- ---------
Net Cash Used in Operating Activities $ (0) $ (4,000)
------- ---------
CASH FLOW FROM INVESTING ACTIVITIES:
Net Cash Used in Investing Activities $ -- $ --
CASH FLOW FROM FINANCING ACTIVITIES:
Stock issued for service $ -- $ 4,000
-------- ---------
Net Cash Provided by Financing Activities $ -- $ 4,000
-------- ---------
NET INCREASE IN CASH - -
Cash - Beginning of Period $ - $ -
-------- ---------
Cash - End of Period $ - $ -
======== =========
Supplemental Disclosure of Cash Flow Information
Cash paid for:
Interest $ -- $ --
Income taxes $ -- $ --
======== =========
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Common Stock issued to founder for
services rendered $ -- $ 4,000
========== ===========
(The Accompanying Notes are an Integral Part of These Financial
Statements)
27
F-5
Flex Capital Corp.
(A Development Stage Company)
Statement of Changes in Stockholders' Deficit
For the Period from October 27, 2009 (inception)
Through March 31, 2011
Deficit Additional Accumulated Total
Common Stock Paid-in During Development Stockholders'
Shares Amount Capital Stage Deficit
------ ------ ------- ---------- -----------
Shares Issued for Service
at $0.001 Per Share
October 27, 2009 (Inception) 4,000,000 $4,000 -- -- $ 4,000
Net Loss for the Fiscal Year
Ended December 31, 2009 (Audited) -- -- -- (5,250) $ (5,250)
Balances December
31, 2009 4,000,000 $ 4,000 -- $ (5,250) $ (1,250)
========= ====== ====== ====== ======
Net Loss for the year
ended December 31, 2010
(Audited) -- -- -- -- --
Balance, December 31, 2010 4,000,000 $ 4,000 -- $ (5,250) $ (1,250)
========= ====== ====== ====== ======
Net Loss for the year
ended March 31, 2011 (Unaudited) -- -- -- -- --
Balance, March 31, 2011 4,000,000 $ 4,000 -- $ (6,500) $ (2,500)
========= ====== ====== ====== ======
(The Accompanying Notes are an Integral Part of These Financial
Statements)
28
F-6
Flex Capital Corp.
(A Development Stage Company)
Notes to the Financial Statements
March 31, 2011
(Unaudited)
NOTE 1 Nature and Continuance of Operations
These financial statements have been prepared on a going concern
basis. The Company is a development stage company, which was
incorporated on October 27, 2009. At the current stage of the
business, we are not engaged in any activities; therefore, the
company has yet to achieve profitable operations and losses are
anticipated in the development of its business, raising substantial
doubt about the Company's ability to continue as a going concern.
Its ability to continue as a going concern is dependent upon the
ability of the Company to generate profitable operations in the
future and/or to obtain the necessary financing to meet its
obligations and repay its liabilities arising from normal business
operations when they come due. Management plans to continue to
provide for its working capital needs by seeking loans from its
shareholders. These financial statements do not include any
adjustments to the recoverability and classification of assets,
or the amount and classification of liabilities that may be
necessary should the Company be unable to continue as a going concern.
Once we have received our cash injection through this offering we
will immediately commence with our planned operations. Our planned
operations include the following:
1. Secure the new capital injection through this offering.
2. Purchase necessary equipments and develop our website within
90days.
At this time, Mr. Lu will initiate contact with businesses to
be enlisted on our website.
3. Launch our website and offer our services to users once we have
listed a reasonable amount of business into our website.
Concurrently, we will advertise our business on local billboards
and other advertisement channels.
4. Sell advertising space to related stakeholders.
The Company's year-end is December 31.
NOTE 2 - Summary of Significant Accounting Policies
Development Stage Company
The Company complies with the FASB Accounting Standards Codification (ASC)
Topic 915 Development Stage Entities and the Securities and Exchange
Commission Exchange Act 7 for its characterization of the Company as
development stage.
Basis of Presentation
Our financial statements have been prepared in conformity with accounting
principles generally accepted in the United States of America. The
preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
us to make estimates and assumptions that affect reported amounts of assets
and liabilities, disclosure of contingent assets and liabilities at the
date of the financial statements, and the reported amounts of revenues,
costs and expenses during the reporting period. Actual results could differ
from the estimates.
Certain reclassifications have been made to conform previously reported
data to the current presentation. These reclassifications have no effect
on our net income (loss) or financial position as previously reported.
Company's accounting year end is December 31.
Impairment of Long Lived Assets
Long-lived assets are reviewed for impairment in accordance with ASC Topic
360, "Accounting for the Impairment or Disposal of Long- lived Assets".
Under ASC Topic 360, long-lived assets are tested for recoverability
whenever events or changes in circumstances indicate that their carrying
amounts may not be recoverable. An impairment charge is recognized or the
amount, if any, which the carrying value of the asset exceeds the fair
value.
Revenue Recognition
The Company recognizes revenue when it is realized or realizable and earned.
The Company considers revenue realized or realizable and earned when it has
persuasive evidence of an arrangement, delivery has occurred, the sales
price is fixed and determinable, and collectability is reasonably assured.
Determining whether some or all of these criteria have been met involves
assumptions and judgments that can have a significant impact on the timing
and amount of revenue the Company reports.
Financial Instruments
The carrying value of the Company's financial instruments consisting of cash
equivalents and accounts payable and accrued liabilities approximates their
fair value because of the short maturity of these instruments. Unless
otherwise noted, it is management's opinion that the Company is not exposed
to significant interest, currency or credit risks arising from these
financial instruments.
Income Taxes
Deferred income taxes are provided using the liability method whereby deferred
tax assets are recognized for deductible temporary differences and operating
loss and tax credit carryforwards, and deferred tax liabilities are recognized
for taxable temporary differences. Temporary differences are the differences
between the reported amounts of assets and liabilities and their tax bases.
Deferred tax assets are reduced by a valuation allowance when, in the opinion
of management, it is more likely than not that some portion or all of the
deferred tax assets will not be realized. Deferred tax assets and liabilities
are adjusted for the effects of the changes in tax laws and rates of the date
of enactment.
When tax returns are filed, it is highly certain that some positions taken
would be sustained upon examination by the taxing authorities, while others
are subject to uncertainty about the merits of the position taken or the
amount of the position that would be ultimately sustained. The benefit of a
tax position is recognized in the financial statements in the period during
which, based on all available evidence, management believes it is more likely
than not that the position will be sustained upon examination, including the
resolution of appeals or litigation processes, if any. Tax positions taken are
not offset or aggregated with other positions. Tax positions that meet the
more-likely-than-not recognition threshold are measured as the largest amount
of tax benefit that is more than 50 percent likely of being realized upon
settlement with the applicable taxing authority. The portion of the benefits
associated with tax positions taken that exceeds the amount measured as
described above is reflected as a liability for unrecognized tax benefits in
the accompanying balance sheets along with any associated interest and
penalties that would be payable to the taxing authorities upon examination.
Basic and Diluted Net Loss Per Share
29
Stock Based Compensation
The Company accounts for stock options and similar equity instruments issued
in accordance with ASC Topic 718 Compensation Stock Compensation. Accordingly,
compensation costs attributable to stock options or similar equity instruments
granted are measured at the fair value at the grant date, and expensed over
the expected vesting period. Transactions in which goods or services are
received in exchange for the issuance of equity instruments are accounted for
based on the fair value of the consideration received or the fair value of the
equity instruments issued, whichever is more reliably measurable. ASC Topic
718 Compensation Stock Compensation requires excess tax benefits be reported
as a financing cash inflow rather than as a reduction of taxes paid.
The Company did not grant any stock options during the period ended March 31,
2011.
New Accounting Standards
Management does not believe that any recently issued, but not yet effective
accounting standards if currently adopted could have a material effect on the
accompanying financial statements.
FINANCIAL STATEMENTS
Flex Capital Corp.
(a Development Stage Company)
December 31, 2010 and 2009
Index
-----
Report of Independent Registered Public Accounting
Firm................... F-1
Balance Sheet as of December 31, 2010 and 2009...... F-7
Statement of Operations for the Period from October
27, 2009 (Inception) Through December 31, 2010 and 2009...... F-8
Statements of Cash Flows for the Period from October 27,
2009 (Inception) Through December 31, 2010.................... F-9
Statement of Changes in Stockholders' Deficit for the Period
From October 27, 2009 (Inception) Through December 31, 2010
.................................. F-10
Notes to the Financial Statements for the Period from
October 27, 2009 (Inception) Through December 31,
2010 ..........................F-11
30
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
F-1
Fort Lee, NJ 07024
Stan J.H. Lee, CPA
2160 North Central Rd. Suite 203 Fort Lee NJ 07024
P.O. Box 436402 San Diego CA 92143
619-623-7799 Fax 619-564-3408 E-mail) stan2u@gmail.com
-------------------------------------------------------------------
Report of Independent Registered Public Accounting Firm
To the Board of Directors and
Shareholders of
Flex Capital Corp.
We have audited the accompanying balance sheets of Flex Capital
Corp. as of December 31, 2010 and 2009 and the related statements of
operations, changes in shareholders' deficiency and cash flows for the
year ended December 31, 2010 and for the period from October 27, 2009
(inception) to December 31, 2009 and for the period from October 27, 2009
(inception) to December 31, 2010. These financial statements are the
responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audit in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards
require that we plan and perform our audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement.
The Company is not required to have, nor were we engaged to perform, an
audit of its internal control over financial reporting. Our audit
included consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the
circumstances, 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. An audit includes examining on
a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Flex Capital Corp. as
of December 31, 2010 and 2009 and the results of their operations and
its cash flows for the aforementioned periods in conformity with U.S.
generally accepted accounting principles.
The financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in notes to the
financial statements, the Company's results of operations and lack of
capital and liquidity raise substantial doubt about its ability to
continue as a going concern. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.
/s/ Stan J.H. Lee, CPA
---------------------------
Stan J.H. Lee, CPA
April 21, 2011
Fort Lee, NJ 07024
31
F-7
Flex Capital Corp.
(A Development Stage Company)
Balance Sheet
As of December 31, 2010 and December 31, 2009
December 31, 2010 December 31, 2009
ASSETS
Current Assets:
Cash $ -- $ --
Total Current Assets $ -- $ --
Total Assets $ -- $ --
======== ========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Advance from Other $ 1,250 $ 1,250
Total Current Liabilities $ 1,250 $ 1,250
-------- --------
Stockholders' Deficit
Common Stock, $0.001 par value,
75,000,000 shares authorized,
4,000,000 issued and outstanding $ 4,000 $ 4,000
Capital Contribution
Deficit accumulated during
development stage (5,250) (5,250)
Total Stockholders' Deficit $ (1,250) $ (1,250)
-------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' DEFICIT $ 0 $ 0
======== ========
(The Accompanying Notes are an Integral Part of These Financial
Statements)
32
F-8
Flex Capital Corp.
(A Development Stage Company)
Statement of Operations
For the Year For the period For the period
Ended December beginning October from October 27,
31, 27, 2009 (Inception) 2009 (Inception)
2010 to December 31, 2009 to December 31, 2010
Revenues $ -- $ -- $ --
Operating Expenses
Professional fees $ $1,500 $ 1,250 $ 2,750
Consulting fees $ -- $ 4,000 $ 4,000
Total Operating Expenses $ (1,500) $ (5,250) $ (6,750)
---------- ---------- ----------
Net Loss $ (1,500) $ (5,250) $ (6,750)
========== ========== ==========
Net Loss Per Common Share
- Basic and Diluted $ -- $ (0.00) $ (0.00)
========== =========== =========
Weighted Average Number of
Common Shares Outstanding
- Basic and Diluted 4,000,000 4,000,000 4,000,000
(The Accompanying Notes are an Integral Part of These Financial
Statements)
33
F-9
Flex Capital Corp.
(A Development Stage Company)
Statement of Cash Flows
For the year For the period For the period
ended December beginning October from October 27,
31, 2010 27, 2009 (Inception) 2009 (Inception)
to December 31, 2009 to December 31, 2010
CASH FLOW FROM OPERATING ACTIVITIES:
Net loss $ -- $ (5,250) $ (6,750)
Adjustments to reconcile net loss
from operations to net cash used
in operating activities:
Changes in working capital $ -- $ 1,250 $ 2,750
-------- --------- ---------
Net Cash Used in Operating Activities $ -- $ (4,000) $ (4,000)
-------- --------- ---------
CASH FLOW FROM INVESTING ACTIVITIES:
Net Cash Used in Investing Activities $ -- $ -- $ --
CASH FLOW FROM FINANCING ACTIVITIES:
Stock issued for service $ -- $ 4,000 $ 4,000
-------- --------- ---------
Net Cash Provided by Financing Activities $ -- $ 4,000 $ 4,000
-------- --------- ---------
NET INCREASE IN CASH
Cash - Beginning of Period $ -- $ -- $ --
-------- --------- ---------
Cash - End of Period $ -- $ -- $ --
======== ========= =========
Supplemental Disclosure of Cash Flow Information
Cash paid for:
Interest $ -- $ -- $ --
Income taxes $ -- $ -- $ --
======== ========= =========
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Common Stock issued to founder for
services rendered $ -- $ 4,000 $ 4,000
======== ========= =========
(The Accompanying Notes are an Integral Part of These Financial
Statements)
34
F-10
Flex Capital Corp.
(A Development Stage Company)
Statement of Changes in Stockholders' Deficit
For the Period from October 27, 2009 (inception)
Through December 31, 2010
Deficit Additional Accumulated Total
Common Stock Paid-in During Development Stockholders'
Shares Amount Capital Stage Deficit
------ ------ ------- ---------- -----------
Shares Issued for Service
at $0.001 Per Share
October 27, 2009 (Inception) 4,000,000 $ 4,000 -- -- $ 4,000
Net Loss for the Fiscal Year
Ended December 31, 2009 -- -- -- (5,250) $ (5,250)
Balances December
31, 2009 4,000,000 $ 4,000 -- $ (5,250) $ (1,250)
========= ====== ====== ====== ======
Net Loss for the year
ended December 31, 2010 -- -- -- -- --
Balance, December 31, 2010 4,000,000 $ 4,000 -- $ (6,750) $ (2,750)
========= ====== ====== ====== ======
(The Accompanying Notes are an Integral Part of These Financial
Statements)
35
F-11
Flex Capital Corp.
(A Development Stage Company)
Notes to the Financial Statements
December 31, 2010 and 2009
NOTE 1 Nature and Continuance of Operations
These financial statements have been prepared on a going concern
basis. The Company is a development stage company, which was
incorporated on October 27, 2009. At the current stage of the
business, we are not engaged in any activities; therefore, the
company has yet to achieve profitable operations and losses are
anticipated in the development of its business, raising substantial
doubt about the Company's ability to continue as a going concern.
Its ability to continue as a going concern is dependent upon the
ability of the Company to generate profitable operations in the
future and/or to obtain the necessary financing to meet its
obligations and repay its liabilities arising from normal business
operations when they come due. Management plans to continue to
provide for its working capital needs by seeking loans from its
shareholders. These financial statements do not include any
adjustments to the recoverability and classification of assets,
or the amount and classification of liabilities that may be
necessary should the Company be unable to continue as a going concern.
Once we have received our cash injection through this offering we
will immediately commence with our planned operations. Our planned
operations include the following:
1. Secure the new capital injection through this offering.
2. Purchase necessary equipments and develop our website within
90days.
At this time, Mr. Lu will initiate contact with businesses to
be enlisted on our website.
3. Launch our website and offer our services to users once we have
listed a reasonable amount of business into our website.
Concurrently, we will advertise our business on local billboards
and other advertisement channels.
4. Sell advertising space to related stakeholders.
The Company's year-end is December 31.
NOTE 2 - Summary of Significant Accounting Policies
Development Stage Company
The Company complies with the FASB Accounting Standards Codification (ASC)
Topic 915 Development Stage Entities and the Securities and Exchange
Commission Exchange Act 7 for its characterization of the Company as
development stage.
Basis of Presentation
Our financial statements have been prepared in conformity with accounting
principles generally accepted in the United States of America. The
preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
us to make estimates and assumptions that affect reported amounts of assets
and liabilities, disclosure of contingent assets and liabilities at the
date of the financial statements, and the reported amounts of revenues,
costs and expenses during the reporting period. Actual results could differ
from the estimates.
Certain reclassifications have been made to conform previously reported
data to the current presentation. These reclassifications have no effect
on our net income (loss) or financial position as previously reported.
Company's accounting year end is December 31.
Impairment of Long Lived Assets
Long-lived assets are reviewed for impairment in accordance with ASC Topic
360, "Accounting for the Impairment or Disposal of Long- lived Assets".
Under ASC Topic 360, long-lived assets are tested for recoverability
whenever events or changes in circumstances indicate that their carrying
amounts may not be recoverable. An impairment charge is recognized or the
amount, if any, which the carrying value of the asset exceeds the fair
value.
Revenue Recognition
The Company recognizes revenue when it is realized or realizable and earned.
The Company considers revenue realized or realizable and earned when it has
persuasive evidence of an arrangement, delivery has occurred, the sales
price is fixed and determinable, and collectability is reasonably assured.
Determining whether some or all of these criteria have been met involves
assumptions and judgments that can have a significant impact on the timing
and amount of revenue the Company reports.
Financial Instruments
The carrying value of the Company's financial instruments consisting of cash
equivalents and accounts payable and accrued liabilities approximates their
fair value because of the short maturity of these instruments. Unless
otherwise noted, it is management's opinion that the Company is not exposed
to significant interest, currency or credit risks arising from these
financial instruments.
Income Taxes
Deferred income taxes are provided using the liability method whereby deferred
tax assets are recognized for deductible temporary differences and operating
loss and tax credit carryforwards, and deferred tax liabilities are recognized
for taxable temporary differences. Temporary differences are the differences
between the reported amounts of assets and liabilities and their tax bases.
Deferred tax assets are reduced by a valuation allowance when, in the opinion
of management, it is more likely than not that some portion or all of the
deferred tax assets will not be realized. Deferred tax assets and liabilities
are adjusted for the effects of the changes in tax laws and rates of the date
of enactment.
When tax returns are filed, it is highly certain that some positions taken
would be sustained upon examination by the taxing authorities, while others
are subject to uncertainty about the merits of the position taken or the
amount of the position that would be ultimately sustained. The benefit of a
tax position is recognized in the financial statements in the period during
which, based on all available evidence, management believes it is more likely
than not that the position will be sustained upon examination, including the
resolution of appeals or litigation processes, if any. Tax positions taken are
not offset or aggregated with other positions. Tax positions that meet the
more-likely-than-not recognition threshold are measured as the largest amount
of tax benefit that is more than 50 percent likely of being realized upon
settlement with the applicable taxing authority. The portion of the benefits
associated with tax positions taken that exceeds the amount measured as
described above is reflected as a liability for unrecognized tax benefits in
the accompanying balance sheets along with any associated interest and
penalties that would be payable to the taxing authorities upon examination.
Basic and Diluted Net Loss Per Share
36
Stock Based Compensation
The Company accounts for stock options and similar equity instruments issued
in accordance with ASC Topic 718 Compensation Stock Compensation. Accordingly,
compensation costs attributable to stock options or similar equity instruments
granted are measured at the fair value at the grant date, and expensed over
the expected vesting period. Transactions in which goods or services are
received in exchange for the issuance of equity instruments are accounted for
based on the fair value of the consideration received or the fair value of the
equity instruments issued, whichever is more reliably measurable. ASC Topic
718 Compensation Stock Compensation requires excess tax benefits be reported
as a financing cash inflow rather than as a reduction of taxes paid.
The Company did not grant any stock options during the period ended December
31, 2010 and 2009.
New Accounting Standards
Management does not believe that any recently issued, but not yet effective
accounting standards if currently adopted could have a material effect on the
accompanying financial statements.
NOTE 3- EARNING (LOSS) PER SHARE
Income (loss) Shares Per Share
(Numerator) (Denominator) Amount
For the Year Ended
December 31, 2010:
Basic and diluted EPS
Income to common
stockholders $ (-0- ) 4,000,000 $ (0.00)
Income (loss) Shares Per Share
(Numerator) (Denominator) Amount
For the Year Ended
December 31, 2009:
Basic and diluted EPS
Loss to common
stockholders $ (5,250) 4,000,000 $ (0.00)
NOTE 4 - Advance from Other
During 2009, an officer of the Company advanced to the Company
$1,250 in the form of expenses incurred on behalf of the Company.
The balance was $ 1,250 at December 31, 2010 and 2009.
NOTE 5- CAPITAL STOCK
On October 27, 2009, the Company issued 4,000,000 common shares
in exchange to the sole officer and director of the Company in
exchange for his services to the Company.
NOTE 6 - SUBSEQUENT EVENTS
In 2009, the FASB ASC Topic 865 (formerly FASB 165, Subsequent
Events), which defines the period after the balance sheet date
that subsequent events should be evaluated and provides guidance
in determining if the event should be reflected in the current
financial statements. This ASC Topic also requires disclosure
regarding the date through which subsequent events have been
evaluated. The Company adopted the provisions of Statement 165 as
of December 31, 2009.
The Company has evaluated subsequent events through the time the
December 31, 2010 financial statements were issued. No events have
occurred subsequent to December 31, 2010 that require disclosure or
recognition in these financial statements other than as listed below.
37
PART II. INFORMATION
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses of the offering all of which are to be paid
by the registrant are as follows:
SEC Registration Fee $ 100
Accounting Fees and Expenses 3,000
Legal Fees and Expenses 1,900
-------
TOTAL $ 5,000
=======
RECENT SALES OF UNREGISTERED SECURITIES.
During the past three years, the registrant has sold the following
securities which were not registered under the Securities Act of
1933, as amended.
Name and Address Date Shares
Consideration
---------------- ---- ------
Qing Feng Lu October 27, 2009 4,000,000
Provision of Service
Room 1707, Unit A,
17th Floor CTS Center,
219 Zhong Shan Wu Road,
Guangzhou, China, 510031
We issued the foregoing restricted shares of common stock to Mr. Lu
pursuant to Regulation S of the General Rules and Regulations
promulgated under the Securities Act of 1933. The sale of our shares
to Mr. Lu took place outside the United States of America and Mr. Lu
is non-US persons as defined in Regulation S. Further, no
commissions were paid to anyone in connection with the sale of our
shares and general solicitation was not made to anyone.
We have issued 4,000,000 shares of common stock to Mr. Lu, our
sole officer and director for a total consideration of $4,000 or
$0.001 per share. The consideration was provided in exchange for
Mr. Lu's services. Mr. Lu has and will continue managing all
facets of our operations for the next twelve months. Our company
has already utilized Mr. Lu's networks in the Guangdong Province to
minimize future operational barriers as we enter the marketplace.
Mr. Lu will continue to build our relationship with potential
clients and market our business to related businesses.
38
EXHIBITS.
The following Exhibits are filed as part of this Registration
Statement:
Exhibit No. Document Description
----------- --------------------
3.1 Articles of Incorporation.*
3.2 Bylaws.*
5.1 Opinion of regarding the legality of the securities
being registered.**
23.1 Consent of Stan J.H. Lee Certified Public Accountant.*
23.2 Consent of law firm.**
24.1 Power of Attorney
99.1 Subscription Agreement.*
*Filed previously
** Will be filed with future amendment to the Form S-1
39
UNDERTAKINGS.
A. The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more
than 20 percent change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective registration statement; and
iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
(4) Intentionally omitted.
(5) That, for the purpose of determining liability under the
Securities Act of 1933 to any purchaser:
(i) Intentionally omitted.
(ii) If the registrant is subject to Rule 430C, each prospectus
filed pursuant to Rule 424(b) as part of a registration statement
relating to an offering, other than registration statements relying
on Rule 430B or other than prospectuses filed in reliance on Rule
430A, shall be deemed to be part of and included in the registration
statement as of the date it is first used after effectiveness.
Provided, however, that no statement made in a registration
statement or prospectus that is part of the registration statement
or made in a document incorporated or deemed incorporated by
reference into the registration statement or prospectus that is part
of the registration statement will, as to a purchaser with a time of
contract of sale prior to such first use, supersede or modify any
statement that was made in the registration statement or prospectus
that was part of the registration statement or made in any such
document immediately prior to such date of first use.
40
(6) That, for the purpose of determining liability of the registrant
under the Securities Act of 1933 to any purchaser in the initial
distribution of the securities:
The undersigned registrant undertakes that in a primary offering of
securities of the undersigned registrant pursuant to this
registration statement, regardless of the underwriting method used
to sell the securities to the purchaser, if the securities are
offered or sold to such purchaser by means of any of the following
communications, the undersigned registrant will be a seller to the
purchaser and will be considered to offer or sell such securities to
such purchaser:
(i) Any preliminary prospectus or prospectus of the undersigned
registrant relating to the offering required to be filed pursuant to
Rule 424.
(ii) Any free writing prospectus relating to the offering prepared
by or on behalf of the undersigned registrant or used or referred to
by the undersigned registrant;
(iii) The portion of any other free writing prospectus relating to
the offering containing material information about the undersigned
registrant or its securities provided by or on behalf of the
undersigned registrant; and
(iv) Any other communication that is an offer in the offering made
by the undersigned registrant to the purchaser.
B. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and
is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense of
any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the
Act and will be governed by the final adjudication of such issue.
41
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant has duly caused this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized in the
City of Chang Chun, China, on the 13th day of July, 2011.
(Registrant)
FLEX CAPITAL CORP.
By: /s/ Qing Feng Lu
Qing Feng Lu, President
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in
the capacities and on the dates indicated.
Name Title Date
/s/Qing Feng Lu
Qing Feng Lu Principal Executive Officer, July 13, 2011
Principal Accounting
Officer, Chief Financial Officer,
Secretary, Chairman of the Board
of Directors
42
