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EX-32.1 - EXHIBIT 32.1 - HUALE ACOUSTICS Corp | ex32_1apg.htm |
EX-31.2 - EXHIBIT 31.2 - HUALE ACOUSTICS Corp | ex31_2apg.htm |
EX-31.1 - EXHIBIT 31.1 - HUALE ACOUSTICS Corp | ex31_1apg.htm |
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the fiscal year ended December 31, 2016
[ ] Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from __________ to __________
Commission file number: 333-202841
ILLUMITRY CORP. |
(Exact name of small business issuer as specified in its charter) |
Nevada | 7389 | 36-4797609 |
(State or other jurisdiction of incorporation or organization) | (Primary Standard Industrial Classification Number) | (IRS Employer Identification Number) |
P.O Box 2551 Carlsbad, CA 92018 (Address of principal executive offices) |
(702) 751-2912 |
(Issuer's telephone number)
illumitrycorp@gmail.com (Issuer's email) |
None |
Securities registered under Section 12(b) of the Exchange Act |
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None |
Securities registered under Section 12(g) of the Exchange Act |
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No [X]
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes [X] No [ ]
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes [ ] No [X]
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] |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [X] No [ ]
The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant as of June 30, 2016, was NIL based upon the price ($0.00) at which the common stock was last sold as of the last business day of the most recently completed second fiscal quarter, multiplied by the approximate number of shares of common stock held by persons other than executive officers, directors and five percent stockholders of the registrant without conceding that any such person is an affiliate of the registrant for purposes of the federal securities laws. Our common stock is traded in the over-the-counter market and quoted on the Over-The-Counter Bulletin Board under the symbol ILUM.
As of December 31, 2016, the registrant had 3,625,000 shares of common stock, par value $0.001, issued and outstanding.
Documents incorporated by reference: None
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TABLE OF CONTENTS
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PART I |
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Item 1. | Description of Business. | 4 |
Risk Factors. | 7 | |
Item 1B. | Unresolved Staff Comments. | 10 |
Item 2 | Properties. | 10 |
Item 3. | Legal proceedings. | 10 |
Item 4. | Mine Safety Disclosures. | 10 |
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PART II |
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Item 5. | Market for Common Equity and Related Stockholder Matters. | 11 |
Item 6. | Selected Financial Data. | 11 |
Item 7. | Managements Discussion and Analysis of Financial Condition and Results of Operations. | 12 |
Item 7A. | Quantitative and Qualitative Disclosures About Market Risk. | 16 |
Item 8. | Financial Statements and Supplementary Data. | 16 |
Item 9. | Changes In and Disagreements With Accountants on Accounting and Financial Disclosure. | 27 |
Item 9A(T). | Controls and Procedures | 27 |
Item 9B. | Other Information. | 28 |
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PART III |
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Item 10 | Directors, Executive Officers, Promoters and Control Persons of the Company. | 30 |
Item 11. | Executive Compensation. | 31 |
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. | 31 |
Item 13. | Certain Relationships and Related Transactions, and Director Independence. | 31 |
Item 14. | Principal Accounting Fees and Services. | 31 |
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PART IV |
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Item 15. | Exhibits | 33 |
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Signatures | 34 |
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PART I
Item 1. Description of Business
FORWARD-LOOKING STATEMENTS
Statements made in this Form 10-K that are not historical or current facts are "forward-looking statements" made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange Act of 1934. These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.
Financial information contained in this report and in our financial statements is stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.
COMPANY
Illumitry Corp., was incorporated in the State of Nevada on October 17, 2014 and established a fiscal year end of December 31. We have generated limited revenues, have minimal assets and have incurred losses since inception. We are a company formed to commence operations in a field of embroidery on fabric and cloth in Armenia.
On February 21, 2017, (i) Ms. Arusyak Sukiasyan resigned from all positions with the Company, including the sole member of the Companys Board of Directors and the Companys President, Chief Executive Officer, Chief Financial Officer, Secretary and Treasurer. The resignation of Ms. Sukiasyan was not the result of any disagreement with the Company on any matter relating to the Companys operations, policies or practices.
On February 21, 2017, Mr. Collin McMullen was appointed to the Companys Board of Directors and as the Companys President, Chief Executive Officer, Chief Financial Officer, Treasurer, and Secretary.
OUR BUSINESS
We plan to commence operations in the clothing field, such as embroidery production on any facture on which our machine is suitable for. It could be embroidery on any wardrobe items, headgear, any labels for the enterprises, or embroidery on upholstery. The labels usually present the name of the Company on work wear, also on the advertising items such as hats or scarves, gloves, jackets and other related items. Our embroidery machine has a special nozzle for embroidery on hats which gives us more opportunities for offering our embroidery product to the potential customers. We plan to develop a new product embroidery on damaged cloth that cannot be repaired in another way. This can be embroidery on pants or jackets where the damage occurred, camouflaging the damage. This can be a good alternative for saving the damaged garment. We intend to offer our services to clients in Armenia. We also plan to expand our embroidery business to the neighboring countries such as Georgia and Turkey. National Armenian cloth and national Turkey and Georgian cloth have many common embroidery elements that make our embroidery business high demand in these countries. Ms. Sukiasyan will perform our embroidery production. Price of embroidery on fabric and cloth will depend on the complexity of the order and will be calculated individually.
PRODUCT
Our product can be represented as embroidery products. Embroidery products include, but are not limited to: logos on work wear, images on cloth, patches, embroidery on hats, jackets, and on linen, blankets, leather upholstery and others. Our embroidery machine operates through the computer and which allows us to embroider on almost any kind of item. The main product of our production is embroidery on fabric.
We plan to enter the market with embroidery production assortment. Illumitry Corp. specializes in embroidery production, oriented on potential customers. In Armenia, embroidery is a main part of the traditional Armenian clothing, which makes our business more attractive for customers.
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With our embroidery you can complete your appearance with the special embroidery label on your cloth which you could create by your own, making it the perfect finishing touch in a total view and make you feel unique. For big companies it is very useful to make them more known and recognizable. We are planning to negotiate with well-established companies and enterprises and offer them our embroidery for their items of advertising companies and marketing development.
EQUIPMENT
We have purchased one computer operated embroidery machine for embroidery mostly on any surface. The embroidery machine includes the machine with installed computer and all raw materials necessary for setting up and testing. The cost of one machine is $5,300, which includes the cost of the machine, raw materials, delivery and customs clearance.
Item: | Embroidery Machine ELUCKY EG1501CS |
Import: | Armenia |
Export: | China |
Machine cost: | $3,500 |
Country of origin: | China |
Cost of delivery: | $300 |
Total cost: | $3,800 |
Raw materials | $ 800 |
DTA | --- |
VAT | $700 |
Total: unit, import, customs and taxes | $5,300 |
Embroidery machine is not large, is user-friendly, and is simple to operate. We have already purchased one embroidery machine:
Technical characteristics:
Model Number: | ELUCKY EG1501CS |
Power: | 100V/60Hz to 240V/50Hz |
Weight: | 130 kg |
Dimensions: | 800*800*1600MM |
Max speed: | 1200SPM high speed |
RAW MATERIALS
Our raw materials are spools of polyester and rayon threads which come in different diameters and a variety of colors, brightness and texture. In our production, we currently intend to use raw materials purchased from MAX SEA TRADING LIMITED, the same vendor that provided our embroidery machine. However, there are other vendors who carry the embroidery thread and supplies we need, so we are not limited to purchasing from only this vendor. To date we have purchased what we believe are the most popular and requested colors. Depending on the proceeds received from this offering, we will purchase additional spools of threads to increase our embroidery options.
TARGET MARKET
We intend to target two markets: corporate and private. By corporate we mean large and small companies. In this market, we can provide embroidery for the products the companys produce, for the labels for their products (e.g., clothing size and care labels), for the companys workforce uniforms, and on advertising and promotional items such as hats, shirts, and jackets. Also we can supply our embroidery products to fabric stores. By private market we mean any individual customer with any request for embroidery of his own design on any cloth or requested item. Our embroidery products can be a part of any wardrobe or cloth, to show the uniqueness of the item.
In the corporate market, we are planning to negotiate with Jean Jacques Atelier, Ars-Fine Ltd., a professional cloth manufacturer, and Kareno Atelier. However, no contact has been made with any of these potential clients at this time. We have already signed an Agreement for sale of goods with Mariyan Atelier and Shop of Fabric, upon this agreement the company has generated limited revenues to date. Under this agreement with Mariyan, there is no minimum purchase obligation.
We will look for potential customers on the Internet and reach out to them via telephone and emails. With our embroidery machine, we can embroider on almost any fabric. Furthermore, we will look to offer our embroidery products to potential customers in the neighboring countries of Georgia and Turkey.
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INDUSTRY ANALYSIS
We offer quality and inexpensive embroidery products, which we believe can satisfy any requirements of our clients. We also plan to have a special section on our website with examples of our products and offers for wholesale clients and partners. We also plan to initiate relations with clothing companies and small enterprises who manufacture traditional Armenian clothing that develop unique designs for their clients and offer our services as their subcontractor for quality embroidery on fabric and cloth.
Our supplier and our client now are representative of a concentration so there are risks associated with having a singular concentration for either.
MARKETING
Our marketing campaign consists of several stages. First of all we will start out from direct marketing, such as offering our product at fairs and exhibitions, which will provide up-close demonstration of the high-quality and affordability of our embroidery. Launch of our e-commerce ready web-site, banners on popular websites and advertisements in social networks will be the second step of our campaign. In addition, we will send our advertisements to clothing companies, small manufacturers of traditional Armenian clothing, which can raise customer awareness and attract new partners. We are ready to offer a reasonable discount for long term cooperation. We have designed the business card for our company. We will put this card together with the customer order.
We believe this marketing campaign will attract many customers and will help us develop a strong reputation of quality, diligent and inexpensive embroidery products. Hopefully, our clients will readily recommend us to others.
COMPETITION ON THE MARKET
In Armenia, there is a high level of competition for embroidery production. There are many Armenian companies that are established embroidery producers and that maintain a strong position in the market. For example, we face strong competition from Saw.Am Company and Embdesign, two Armenian companies which specialize in embroidery.
The principal competitive factors in our industry are pricing and quality of embroidery on fabric and cloth, such as quality of threads for good implementation of design solution on the surface. Illumitry Corp. is offering embroidery using a modern computerized embroidery machine, which completes production in a shorter time, has higher quality of embroidery, and higher design accuracy. We will be in a market where we compete directly with domestic and international companies offering similar products of embroidery. Larger embroidery companies may be able to provide more favorable services to customers. Many of these companies may have a greater customer base than us. Also, many of these companies will be able to offer better price for similar product than us. All of this competition may cause us to lose business to our competitors. We anticipate challenges from other new market entrants. We may be unable to compete effectively with these existing or new embroidery companies, which could have a material adverse effect on our financial condition and results of our operation.
Illumitry Corp. has only just entered the market with one customer. We are at a competitive disadvantage in the market. We are one of many participants in the embroidery business. Nearly all Illumitry Corp.s competitors have significantly greater financial resources, technical expertise, and managerial capabilities than Illumitry Corp. Therefore, Illumitry Corp. may not be able to establish itself within the industry at all.
INSURANCE
We do not maintain any insurance and do not intend to maintain insurance in the future. Because we do not have any insurance, if we are made a party to a products liability action, we may not have sufficient funds to defend the litigation. If that occurs a judgment could be rendered against us that could cause us to cease operations.
EMPLOYEES
We are a development stage company and currently have no employees, other than our sole officer and director, Collin McMullen. Our business office is located at: P.O Box 2551, Carlsbad, CA 92018.
OFFICES
The phone number is +17027512912. We do not currently own any property. The Company has re-signed a one year rental agreement with Hamlet Hayrapetyan, starting on August 16, 2016 and ending on August 16, 2017, with monthly rent of $200. The office is 30 square meters in underground passage on Sasunci Davit Square, Yerevan, Armenia.
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We do not have any investments or interests in any real estate. We do not invest in real estate mortgages, nor do we invest in securities of, or interests in, persons primarily engaged in real estate activities.
GOVERNMENT REGULATION
We will be required to comply with all regulations, rules and directives of governmental authorities and agencies applicable to our business in any jurisdiction which we would conduct activities. We do not believe that regulation will have a material impact on the way we conduct our business.
Item 1A. Risk Factors
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
An investment in the Company's common stock involves a high degree of risk. One should carefully consider the following risk factors in evaluating an investment in the Company's common stock. If any of the following risks occurs, the Company's business, financial condition, results of operations or cash flow could be materially and adversely affected. In such case, the trading price of the Company's common stock could decline, and one could lose all or part of one's investment. One should also refer to the other information set forth in this report, including the Company's consolidated financial statements and the related notes.
Risks Associated To Our Business
Our Independent Registered Public Accountant Has Expressed Substantial Doubt About Our Ability To Continue as A Going Concern.
We have accrued net losses of $20,384 for the year ending December 31, 2016, and have limited revenues of $12,680 for the year ended December 31, 2016. Our future is dependent upon our ability to obtain significant financing and upon future profitable operations. Further, the finances required to fully develop our plan cannot be predicted with any certainty and may exceed any estimates we set forth.
Michael Gillespie & Associates, PLLC, our independent registered public accounting firm, has expressed substantial doubt about our ability to continue as a going concern. This opinion could materially limit our ability to raise additional funds by issuing new debt or equity securities or otherwise. You should consider our independent registered public accountants comments when determining if an investment in Illumitry Corp. is suitable.
We Are A Development Stage Company And Have Commenced Limited Operations In Our Business. We Expect To Incur Significant Operating Losses For the Foreseeable Future.
We were incorporated on October 17, 2014 and have commenced limited business operations. Accordingly, we have no way to evaluate the likelihood that our business will be successful. Potential investors should be aware of the difficulties normally encountered by new companies and the high rate of failure of such enterprises. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the operations that we plan to undertake. These potential problems include, but are not limited to, unanticipated problems relating to the ability to generate sufficient cash flow to operate our business and additional costs and expenses that may exceed current estimates. We anticipate that we will incur increased operating expenses without realizing any additional revenues. We expect to incur significant losses into the foreseeable future. We recognize that if the effectiveness of our business plan is not forthcoming, we will not be able to continue business operations. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and it is doubtful that we will generate any significant operating revenues or ever achieve profitable operations. If we are unsuccessful in addressing these risks, our business may likely be unsuccessful.
If We Do Not Attract Sufficient Number of Customers, We Will Not Make Significant Profit, Which Ultimately Result In A Cessation of Operations.
The Company currently has three customers. We have not identified any more customers and we cannot guarantee we will ever have any additional customers. Even if we obtain customers, there is no guarantee that we will generate additional revenues, which can negatively impact our business.
We Face Strong Competition From Larger And Well Established Companies, Which Could Harm Our Business And Ability To Operate Profitably.
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Our industry is competitive. There are many different types of clothing companies in Armenia, which specialize in embroidery and our services are not unique. Even though the industry is fragmented, it has a number of large and well established companies, each of which are profitable and have developed a brand name. Marketing tactics implemented by our competitors could impact our limited financial resources and adversely affect our ability to compete in our market.
We Operate In A Competitive Environment, And If We Are Unable To Compete With Our Competitors, Our Business, Financial Condition, Results of Operations, Cash Flows And Prospects Could Be Materially Adversely Affected.
We operate in a competitive environment. Our competition includes large, small and midsized companies, and many of them may sell similar embroidery on fabric and cloth in our markets at competitive prices. This competitive environment could materially adversely affect our business, financial condition, results of operations, cash flows and prospects.
Because We Are Small And Do Not Have Much Capital, Our Marketing Campaign May Not Be Enough To Attract Sufficient Number of Customers To Operate Profitably. If We Do Not Make A Profit, We Will Suspend Or Cease Operations.
Due to the fact we are small and do not have much capital, we must limit our marketing activities and may not be able to make our services known to potential customers. Because we will be limiting our marketing activities, we may not be able to attract enough customers to operate profitably.
Because Our Principal Assets Are Located Outside of The United States, And Arusyak Sukiasyan, Our Former Director And Officer, Resides Outside of the United States, It May Be Difficult For An Investor To Enforce Any Right Based on U.S. Federal Securities Laws Against Us And/Or Ms. Sukiasyan, Or To Enforce A Judgment Rendered By A United States Court Against Us Or Ms. Sukiasyan.
Our principal operations and assets are located outside of the United States, and Arusyak Sukiasyan, our former officer and director, is a non-resident of the United States. Therefore, it may be difficult to effect service of process on Ms. Sukiasyan in the United States, and it may be difficult to enforce any judgment rendered against Ms. Sukiasyan. As a result, it may be difficult or impossible for an investor to bring an action against Ms. Sukiasyan, in the event that an investor believes that such investors rights have been infringed under the U.S. securities laws, or otherwise. Even if an investor is successful in bringing an action of this kind, the laws of Republic of Armenia may render that investor unable to enforce a judgment against the assets of Ms. Sukiasyan. As a result, our shareholders may have more difficulty in protecting their interests through actions against our management, director or major shareholder, compared to shareholders of a corporation doing business in and whose officers and directors reside within the United States.
Additionally, our assets are located outside of the United States. Therefore, they will be outside of the jurisdiction of United States courts to administer, if we become subject to an insolvency or bankruptcy proceeding. As a result, if we declare bankruptcy or insolvency, our shareholders may not receive the distributions on liquidation that they would otherwise be entitled to if our assets were located within the United States and subject to United States bankruptcy laws.
Our Internal Controls May Be Inadequate, Which Could Cause Our Financial Reporting To Be Unreliable And Lead To Misinformation Being Disseminated To the Public. As A Result, Our Stockholders Could Lose Confidence In Our Financial Results, Which Could Harm Our Business And the Market Value of Our Common Shares.
Effective internal controls are necessary for us to provide reliable financial reports and effectively prevent fraud. We may in the future discover areas of our internal controls that need improvement. Section 404 of the Sarbanes-Oxley Act of 2002 will require us to continue to evaluate and to report on our internal controls over financial reporting. We cannot be certain that we will be successful in continuing to maintain adequate control over our financial reporting and financial processes. Furthermore, if our business grows, our internal controls will become more complex, and we will require significantly more resources to ensure our internal controls remain effective. Additionally, the existence of any material weakness or significant deficiency would require management to devote significant time and incur significant expense to remediate any such material weaknesses or significant deficiencies and management may not be able to remediate any such material weaknesses or significant deficiencies in a timely manner.
Key Management Personnel May Leave the Company, Which Could Adversely Affect the Ability of the Company To Continue Operations.
The Company is entirely dependent on the efforts of its sole officer and director. The Company does not have an employment agreement in place with its sole officer and director. His departure or the loss of any other key personnel in the future could have a material adverse effect on the business. There is no guarantee that replacement personnel, if any, will help the Company to operate profitably. The Company does not maintain key person life insurance on its sole officer and director
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Our Sole Officer And Director Has No Experience Managing A Public Company Which Is Required To Establish And Maintain Disclosure Control And Procedures And Internal Control Over Financial Reporting.
Collin McMullen, our sole officer and director has never operated as a public company. He has no experience managing a public company, which is required to establish and maintain disclosure controls and procedures and internal control over financial reporting. As a result, we may not be able to operate successfully as a public company, even if our operations are successful. We plan to comply with all of the various rules and regulations, which are required for a public company that is reporting company with the Securities and Exchange Commission. However, if we cannot operate successfully as a public company, your investment may be materially adversely affected.
As An Emerging Growth Company Under the JOBS Act, We Are Permitted To Rely on Exemptions From Certain Disclosure Requirements.
We qualify as an emerging growth company under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:
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have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;
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provide an auditor attestation with respect to managements report on the effectiveness of our internal controls over financial reporting;
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comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditors;
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report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);
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submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay and say-on-frequency; and
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disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executives compensation to median employee compensation.
In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
We will remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period. Even if we no longer qualify for the exemptions for an emerging growth company, we may still be, in certain circumstances, subject to scaled disclosure requirements as a smaller reporting company. For example, smaller reporting companies, like emerging growth companies, are not required to provide a compensation discussion and analysis under Item 402(b) of Regulation S-K or auditor attestation of internal controls over financial reporting.
Until such time, however, we cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
Any Additional Funding, We Arrange Through the Sale of Our Common Stock Will Result In Dilution To Existing Shareholders.
We must raise additional capital in order for our business plan to succeed. Our most likely source of additional capital will be through the sale of additional shares of common stock. Such stock issuances will cause stockholders interests in our company to be diluted. Such dilution will negatively affect the value of an investors shares.
Because we are a shell company, the holders of our restricted securities will not be able to sell their securities in reliance on Rule 144, until we cease being a shell company.
We are a shell company as the applicable federal securities law defines that term. Specifically, because of the nature and amount of our assets, our limited operations history and limited revenues pursuant to applicable federal rules, we are considered a shell company. Applicable provisions of Rule 144 specify that during that time that we are a shell company holders of our restricted
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securities cannot sell those securities in reliance on Rule 144. Another implication of us being a shell company is that we cannot file registration statements under Section 5 of the Securities Act using a Form S-8, a short form of registration to register securities issued to employees and consultants under an employee benefit plan. For us, to cease being a shell company, we must have more than nominal operations and more that nominal assets or assets which do not consist solely of cash or cash equivalents.
Our Common Shares Will Not Initially Be Registered Under the Exchange Act And As A Result We Will Have Limited Reporting Duties Which Could Make Our Common Stock Less Attractive To Investors.
Our common shares are not registered under Section 12 of the Exchange Act. As a result, we will not be subject to the federal proxy, tender offer, and short swing insider trading rules for Section 12 registrations, and our directors, executive officers and 10% beneficial holders will not be subject to Section 16 of the Exchange Act. In addition, our reporting obligations under Section 15(d) of the Exchange Act may be suspended automatically if we have fewer than 300 shareholders of record on the first day of our fiscal year. Our common shares are not registered under the Securities Exchange Act of 1934, as amended, and we do not intend to register our common shares under the Exchange Act for the foreseeable future, provided that, we will register our common shares under the Exchange Act if we have, after the last day of our fiscal year, more than either (i) 2,000 persons; or (ii) 500 shareholders of record who are not accredited investors, in accordance with Section 12(g) of the Exchange Act. As a result, although, upon the effectiveness of the registration statement of which this prospectus forms a part, we will be required to file annual, quarterly, and current reports pursuant to Section 15(d) of the Exchange Act, as long as our common shares are not registered under the Exchange Act, we will not be subject to Section 14 of the Exchange Act, which, among other things, prohibits companies that have securities registered under the Exchange Act from soliciting proxies or consents from shareholders without furnishing to shareholders and filing with the Securities and Exchange Commission a proxy statement and form of proxy complying with the proxy rules.
In addition, so long as our common shares are not registered under the Exchange Act, our directors and executive officers and beneficial holders of 10% or more of our outstanding common shares will not be subject to Section 16 of the Exchange Act. Section 16(a) of the Exchange Act requires executive officers and directors, and persons who beneficially own more than 10% of a registered class of equity securities to file with the SEC initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of common shares and other equity securities, on Forms 3, 4 and 5, respectively. Such information about our directors, executive officers, and beneficial holders will only be available through this (and any subsequent) registration statement, and periodic reports we file thereunder.
Because Our Common Stock Is Not Registered Under the Securities Exchange Act of 1934, as Amended, Our Reporting Obligations Under Section 15(D) of the Securities Exchange Act of 1934, as Amended, May Be Suspended Automatically If We Have Fewer Than 300 Shareholders of Record on the First Day of Our Fiscal Year.
Our common stock is not registered under the Exchange Act, and we do not intend to register our common stock under the Exchange Act for the foreseeable future (provided that, we will register our common stock under the Exchange Act if we have, after the last day of our fiscal year, $10,000,000 in total assets and either more than 2,000 shareholders of record or 500 shareholders of record who are not accredited investors (as such term is defined by the Securities and Exchange Commission), in accordance with Section 12(g) of the Exchange Act). As long as our common stock is not registered under the Exchange Act, our obligation to file reports under Section 15(d) of the Exchange Act will be automatically suspended if, on the first day of any fiscal year (other than a fiscal year in which a registration statement under the Securities Act has gone effective), we have fewer than 300 shareholders of record. This suspension is automatic and does not require any filing with the SEC. In such an event, we may cease providing periodic reports and current or periodic information, including operational and financial information, may not be available with respect to our results of operations.
Item 1B. Unresolved Staff Comments
Not applicable to smaller reporting companies.
Item 2. Description of Property
We do not own any real estate or other properties.
Item 3. Legal Proceedings
We know of no legal proceedings to which we are a party or to which any of our property is the subject which are pending, threatened or contemplated or any unsatisfied judgments against us.
Item 4. Mine Safety Disclosures
Not applicable.
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PART II
Item 5. Market for Common Equity and Related Stockholder Matters
Market Information
There is a limited public market for our common shares. Our common shares are quoted on the OTC Markets Pink Sheets, but have not traded at this time. Trading in stocks quoted on the OTC Markets Pink Sheets, is often thin and is characterized by wide fluctuations in trading prices due to many factors that may be unrelated to a companys operations or business prospects. We cannot assure you that there will be a market in the future for our common stock.
OTC Market Pink Sheet securities are not listed or traded on the floor of an organized national or regional stock exchange. Instead, OTC Market Pink Sheet securities transactions are conducted through a telephone and computer network connecting dealers in stocks. OTC Markets issuers are traditionally smaller companies that do not meet the financial and other listing requirements of a regional or national stock exchange.
As of December 31, 2016, no shares of our common stock have traded
Number of Holders
As of December 31, 2016, the 3,625,000 issued and outstanding shares of common stock were held by a total of 27 shareholders of record.
Dividends
No cash dividends were paid on our shares of common stock during the fiscal year ended December 31, 2016 and 2015
Recent Sales of Unregistered Securities
The Company has 75,000,000, $0.001 par value shares of common stock authorized.
On November 14, 2014, the company issued a total of 3,000,000 common shares to its founder for a cash contribution of $3,000.
During November 2015, the company issued a total of 25,000 common shares for cash contribution of $484 at $0.02 per share.
During January 2016, the company issued a total of 50,000 common shares for cash contribution of $955 at $0.02 per share.
During February 2016, the company issued a total of 525,000 common shares for cash contribution of $10,392 at $0.02 per share.
During March 2016, the company issued a total of 25,000 common shares for cash contribution of $500 at $0.02 per share.
There were 3,625,000 shares of common stock issued and outstanding as of December 31, 2016,
Purchase of our Equity Securities by Officers and Directors
On November 14, 2014, the Company offered and sold 3,000,000 restricted shares of common stock to our president and director, Arusyak Sukiasyan, for a purchase price of $0.001 per share, for aggregate offering proceeds of $3,000, pursuant to Section 4(2) of the Securities Act of 1933 as he is a sophisticated investor and is in possession of all material information relating to us. Further, no commissions were paid to anyone in connection with the sale of these shares and general solicitation was not made to anyone.
Other Stockholder Matters
None.
Item 6. Selected Financial Data
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
11
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this annual report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.
RESULTS OF OPERATIONS
We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.
We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.
FISCAL YEAR ENDED DECEMBER 31, 2016 COMPARED TO DECEMBER 31, 2015
Revenue
We recognized revenue of $12,680 for the year ended December 31, 2016, compared to $10,183 the year ended December 31, 2015. Our Cost of Goods Sold was $1,523 for the year ended December 31, 2016 compared to $987 for the year ended December 31, 2015. Our Gross profit was $11,157 for the year ended December 31, 2016, compared to $9,196 for the year ended December 31, 2015. These revenues in 2016 related to the sales to our customers Mariyan Atelier and Shop of Fabric, LIDA LTD and Inturi Vaani LLC, and in 2015 our sales related to the sales to one customer Mariyan Atelier and Shop of Fabric.
Operating expenses
Total operating expenses for the year ended December 31, 2016, were $31,541 compared to $18,074 for the year ended December 31, 2015. Our operating expenses consisted of bank service charges $1,159 (December 31, 2015-$685), accounting fees $8,200 (December 31, 2015-$7,200), advertising & promotion $225 (December 31, 2015-$0); legal fees $1,500 (December 31, 2015-$5,200), rent $2,400 (December 31, 2015-$2,000), amortization $892 (December 31, 2015-$892) and regulatory filings $17,165 (December 31, 2015-$2,097). Expenses incurred during the fiscal year ended December 31, 2015, as compared to the year ended December 31, 2015, increased primarily due to the increased scale and scope of business operations.
Net Losses
The net loss for the fiscal year ended December 31, 2016, was $20,384, compare to $8,878 for the fiscal year ended December 31, 2015, due to the factors discussed above.
Liquidity and Capital Resources
As of December 31, 2016, our total assets were $9,970 comprised of cash $3,463, inventory $2,755, prepaid expenses $284 and net fixed assets $3,468. Our total liabilities were $24,000 comprised of a loan from a director. As of December 31, 2015, comprised of cash $176, inventory $871 and net fixed assets $4,360. Our total liabilities were $10,900 comprised of a loan from director.
Shareholders equity has decreased from deficit of $5,493 as of December 31, 2015, to a deficit of $14,030 as of December 31, 2016. The increased deficit was due to the increase in operating expenses.
The Company has accumulated a deficit of $29,362 as of December 31, 2016, compare to $8,978 as of December 31, 2015, and further losses are anticipated in the development of its business. Accordingly, there is substantial doubt about the Companys ability to continue as a going concern.
The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and, or, obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand, sales, loans from directors and, or, the private placement of common stock.
12
Because of the Companys history of losses, its independent auditors, in the reports on the financial statements for the year ended December 31, 2016 and December 31, 2015, expressed substantial doubt about the Companys ability to continue as a going concern. The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that could result from the outcome of this uncertainty.
Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses The Company intends to position itself so that it may be able to raise additional funds through the capital markets. In light of managements efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.
Cash Flows from Operating Activities
We have not generated positive cash flows from operating activities. For the fiscal year ended December 31, 2016, net cash flows used in operating activities was $21,660 compared to $6,809 for December 31, 2015.
Cash Flows from Investing Activities
We neither used nor generated cash from investing activities for the fiscal year ended December 31, 2016, the same as of December 31, 2015.
Cash Flows from Financing Activities
We have financed our operations primarily from the sale of shares of our common stock or by way of loans from our director. For the fiscal year ended December 31, 2016, net cash from financing activities was $24,947 consisting of share issuances for $600, additional paid in capital $11,247 and a loan from a director $13,100. For the fiscal year ended December 31, 2015, net cash from financing activities was $3,485 consisting of share issuance for $25, additional paid in capital $460 and a loan from a director $3,000.
PLAN OF OPERATION AND FUNDING
Our cash reserves are not sufficient to meet our obligations for the next twelve months period. As a result, we will need to seek additional funding in the near future. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of shares of our common stock, from selling our products and from our sole officer and director loan. Ms. Sukiasyan, our sole officer and director, has agreed to land funds to the Company. She has signed an agreement which evidencing the obligation loan funds to the Company if it is needed in case of not raising sufficient funds from this offering.
MATERIAL COMMITMENTS
As of the date of this Annual Report, the Company has re-signed a one year rental agreement with Hamlet Hayrapetyan, starting on August 16, 2016 and ending on August 16, 2017, with monthly rent of $200. The office is 30 square meters in underground passage on Sasunci Davit Square, Yerevan, Armenia.
PURCHASE OF SIGNIFICANT EQUIPMENT
The company has purchased one computer operated embroidery machine for embroidery on almost any type of surface. The embroidery machine includes the machine with installed computer and all raw materials necessary for setting up and testing.
Technical characteristics:
Model Number: | ELUCKY EG1501CS |
Power: | 100V/60Hz to 240V/50Hz |
Weight: | 130 kg |
Dimensions: | 800*800*1600MM |
Max speed: | 1200SPM high speed |
13
OFF-BALANCE SHEET ARRANGEMENTS
As of the date of this Annual Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
GOING CONCERN
The Company has generated limited revenues and incurred a loss since Inception (October 17, 2014) resulting in an accumulated deficit of $29,362 as of December 31, 2016, and further losses are anticipated in the development of its business. Accordingly, there is substantial doubt about the Companys ability to continue as a going concern.
Because of the Companys history of losses, its independent auditors, in the reports on the financial statements for the year ended December 31, 2016 and 2015, expressed substantial doubt about the Companys ability to continue as a going concern. The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that could result from the outcome of this uncertainty.
SIGNIFCANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America, and pursuant to the rules and regulations of the Securities and Exchange Commission (the SEC) and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations, stockholders equity and cash flows of the Company for the year ending December 31, 2016.
Accounting Basis
The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (GAAP accounting). The Company has adopted a December 31 fiscal year end.
Development Stage Company
The Company is a development stage company as defined by section 915-10-20 of the FASB Accounting Standards Codification and among the additional disclosures required as a development stage company are that its financial statements were identified as those of a development stage company, and that the statements of operations, stockholders' deficit and cash flows disclosed activity since the date of its inception (October 17, 2014) as a development stage company Although the Company has recognized nominal amounts of revenue, it is still devoting substantially all of its efforts on establishing the business. All losses accumulated since Inception (October 17, 2014) have been considered as part of the Company's development stage activities. Effective June 10, 2014 FASB changed its regulations with respect to Development Stage Entities and these additional disclosures are no longer required for annual reporting periods beginning after December 15, 2014 with the option for entities to early adopt these new provisions. The Company has elected to early adopt these provisions and consequently these additional disclosures are not included in these financial statements.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. The Company had $3,463 of cash as of December 31, 2016, compare to $176 as of December 31, 2015.
Fair Value of Financial Instruments
14
ASC 820 "Fair Value Measurements and Disclosures" establishes a three-tier fair value hierarchy, which prioritizes the inputs in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market.
These tiers include:
Level 1: defined as observable inputs such as quoted prices in active markets;
Level 2: defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and
Level 3: defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
The carrying value of cash, accounts receivable, accounts payable and the Companys loan from director approximates its fair value due to their short-term maturity.
Inventories
Inventories are stated at the lower of cost or market. Cost is principally determined using the first-in, first out (FIFO) method. The Company had $2,755 in inventory as of December 31, 2016, compared to $871 as of December 31, 2015.
Property and Equipment
Property and equipment are stated at cost and depreciated on the straight-line method over the estimated life of the asset, which is 5 years.
Income Taxes
Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.
Revenue Recognition
The Company will recognize revenue in accordance with Accounting Standards Codification No. 605, Revenue Recognition ("ASC-605"), ASC-605 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management's judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company will defer any revenue for which the product has not been delivered or is subject to refund until such time that the Company and the customer jointly determine that the product has been delivered or no refund will be required.
Stock-Based Compensation
Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.
Basic Income (Loss) Per Share
The Company computes income (loss) per share in accordance with FASB ASC 260, Earnings per Share which requires presentation of both basic and diluted earnings per share on the face of the statement of operations. Basic loss per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted income (loss) per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive.
During the year ended December 31, 2016 and 2015 there were no potentially dilutive debt or equity instruments issued or outstanding and any such shares would have been excluded from the computation because they would have been anti-dilutive as the Company incurred losses in these periods.
15
Comprehensive Income
Comprehensive income is defined as all changes in stockholders' equity (deficit), exclusive of transactions with owners, such as capital investments. Comprehensive income includes net income or loss, changes in certain assets and liabilities that are reported directly in equity such as translation adjustments on investments in foreign subsidiaries and unrealized gains (losses) on available-for-sale securities. During the year ended December 31, 2016 and 2015 there were no differences between our comprehensive loss and net loss.
Recent Accounting Pronouncements
We have reviewed all the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Companys results of operations, financial position or cash flow.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Not applicable to smaller reporting companies.
Item 8. Financial Statements and Supplementary Data
ILLUMITRY CORP.
FINANCIAL STATEMENTS
For the Years Ended December 31, 2016 and December 31, 2015
Table of Contents
|
| Page |
Report of Independent Registered Public Accounting Firm |
| 17 |
|
|
|
Condensed Balance Sheets as of December 31, 2016, and December 31, 2015 |
| 18 |
|
|
|
Condensed Statements of Operations for the year ended December 31, 2016 and December 31, 2015 |
| 19 |
|
|
|
Statement of Stockholders Equity as of December 31, 2016 and December 31, 2015 |
| 20 |
|
|
|
Condensed Statements of Cash Flows for the year ended December 31, 2016 and December 31, 2015 |
| 21 |
|
|
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Notes to Financial Statements |
| 22-26 |
16
MICHAEL GILLESPIE & ASSOCIATES, PLLC
CERTIFIED PUBLIC ACCOUNTANTS
10544 ALTON AVE NE
SEATTLE, WA 98125
206.353.5736
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
Illumitry Corp.
We have audited the accompanying balances sheet of Illumitry Corp. as of December 31, 2016 and 2015 and the related statements of operations, stockholders deficit and cash flows for the periods then ended. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the 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 companys internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide 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 Illumitry Corp. for the years ended December 31, 2016 and 2015 and the results of its operations and cash flows for the years then ended in conformity with generally accepted accounting principles in the United States of America.
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note #2 to the financial statements, although the Company has limited operations it has yet to attain profitability. This raises substantial doubt about its ability to continue as a going concern. Managements plan in regard to these matters is also described in Note #2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/S/ MICHAEL GILLESPIE & ASSOCIATES, PLLC
Seattle, Washington
February 24, 2017
ILLUMITRY CORP.
CONDENCED BALANCE SHEETS
(AUDITED)
|
| December 31, 2016 |
|
| December 31, 2015 |
ASSETS |
|
|
|
|
|
|
|
| |||
Current Assets |
|
|
|
| |
Cash and cash equivalents | $ | 3,463 |
| $ | 176 |
Inventory |
| 2,755 |
|
| 871 |
Prepaid Expenses |
| 284 |
|
| - |
Total Current Assets | $ | 6,502 |
| $ | 1,047 |
|
|
|
|
|
|
Net Fixed Assets |
|
|
|
|
|
Equipment/Website |
| 5,252 |
|
| 5,252 |
Accumulated Depreciation |
| (1,784) |
|
| (892) |
Total Net Fixed Assets |
| 3,468 |
|
| 4,360 |
|
|
|
|
|
|
Total Assets | $ | 9,970 |
| $ | 5,407 |
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS EQUITY |
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities |
|
|
|
|
|
Account payable | $ | - | $ | - | |
Loan from director |
| 24,000 |
|
| 10,900 |
|
|
|
|
| |
Total Liabilities |
| 24,000 |
| 10,900 | |
|
|
|
|
|
|
Shareholders Deficit |
|
|
|
| |
Common stock, par value $0.001; 75,000,000 shares authorized, 3,625,000 and 3,025,000 shares issued and outstanding respectively |
| 3,625 |
|
| 3,025 |
Additional paid-in capital |
| 11,707 |
| 460 | |
Deficit accumulated during the development stage |
| (29,362) | (8,978) | ||
|
|
|
|
| |
Total Stockholders Deficit |
| (14,030) |
|
| (5,493) |
|
|
|
|
|
|
Total Liabilities and Shareholders Deficit | $ | 9,970 |
| $ | 5,407 |
See accompanying notes to unaudited financial statements.
18
ILLUMITRY CORP.
CONDENCED STATEMENT OF OPERATIONS
(AUDITED)
| Year Ended December 31, 2016 | Year Ended December 31, 2015 |
|
|
|
REVENUES | $ 12,680 | $ 10,183 |
Cost of Goods Sold | 1,523 | 987 |
Gross Profit | 11,157 | 9,196 |
|
|
|
OPERATING EXPENSES |
|
|
General and Administrative Expenses | 31,541 | 18,074 |
TOTAL OPERATING EXPENSES | 31,541 | 18,074 |
|
|
|
NET LOSS FROM OPERATIONS | (20,384) | (8,878) |
|
|
|
PROVISION FOR INCOME TAXES | - | - |
|
|
|
NET LOSS | $ (20,384) | $ (8,878) |
|
|
|
NET LOSS PER SHARE: BASIC AND DILUTED | $ (0.01) | $ (0.00) |
|
|
|
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED | 3,553,415 | 3,002,466 |
See accompanying notes to unaudited financial statements.
19
ILLUMITRY CORP.
STATEMENT OF STOCKHOLDERS EQUITY
(AUDITED)
| Common Stock | Additional Paid-in | Accumulated | Total Stockholders | |
| Shares | Amount | Capital | Deficit | Deficit |
|
|
|
|
|
|
Balance, December 31, 2014 | 3,000,000 | $ 3,000 | - | $ (100) | $ 2,900 |
|
|
|
|
|
|
Shares issued for cash at $0.02 per share | 25,000 | 25 | 460 | - | 485 |
|
|
|
|
|
|
Net loss for the year ended December 31, 2015 | - | - | - | (8,878) | (8,878) |
|
|
|
|
|
|
Balance, December 31, 2015 | 3,025,000 | $ 3,025 | 460 | $ (8,978) | $ (5,493) |
|
|
|
|
|
|
Shares issued for cash at $0.02 per share | 600,000 | 600 | 11,247 | - | 11,847 |
|
|
|
|
|
|
Net loss for the year ended December 31, 2016 | - | - | - | (20,384) | (20,384) |
|
|
|
|
|
|
Balance, December 31, 2016 | 3,625,000 | $ 3,625 | 11,707 | $ (29,362) | $ (14,030) |
See accompanying notes to unaudited financial statements.
20
ILLUMITRY CORP.
CONDENCED STATEMENT OF CASH FLOWS
(AUDITED)
| Year Ended December 31, 2016 | Year Ended December 31, 2015 |
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
Net loss for the period | $ (20,384) | $ (8,878) |
Adjustments to reconcile net loss to net cash (used in) operating activities: |
|
|
Inventory | (1,884) | (23) |
Prepaid Expenses | (284) | 1,200 |
Amortization | 892 | 892 |
CASH FLOWS USED IN OPERATING ACTIVITIES | (21,660) | (6,809) |
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
Purchase of Fixed Assets | - | - |
CASH FLOWS USED IN INVESTING ACTIVITIES | - | - |
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
Proceeds from sale of common stock | 600 | 25 |
Additional paid in capital | 11,247 | 460 |
Loans | 13,100 | 3,000 |
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES | 24,947 | 3,485 |
|
|
|
NET INCREASE IN CASH | 3,287 | (3,324) |
|
|
|
Cash, beginning of period | 176 | 3,500 |
|
|
|
Cash, end of period | $ 3,463 | $ 176 |
|
|
|
SUPPLEMENTAL CASH FLOW INFORMATION: |
|
|
Interest paid | $ 0 | $ 0 |
Income taxes paid | $ 0 | $ 0 |
See accompanying notes to unaudited financial statements.
21
ILLUMITRY CORP.
NOTES TO THE AUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016 AND DECEMBER 31, 2015
NOTE 1 ORGANIZATION AND NATURE OF BUSINESS
Illumitry Corp. (the Company, we, us or our) was incorporated in the State of Nevada on October 17, 2014. We are a development-stage company formed to commence operations in a field of embroidery on fabric, furnishings, and clothing in Armenia. Our location is Sasunci Davit Square, Yerevan, Armenia.
NOTE 2 GOING CONCERN
The accompanying financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate continuation of the Company as a going concern. However, the Company had limited revenues and incurred losses as of December 31, 2016. The Company currently has negative working capital, and has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time. Therefore, there is substantial doubt about the Companys ability to continue as a going concern.
Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses The Company intends to position itself so that it will be able to raise additional funds through the capital markets. In light of managements efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.
NOTE 3 SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES
Basis of presentation
The accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America, and pursuant to the rules and regulations of the Securities and Exchange Commission (the SEC) and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations and cash flows of the Company for the year ended December 31, 2016 and December 31, 2015.
Cash and Cash Equivalents
The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. The Company had $3,463 of cash as of December 31, 2016, and $176 of cash as of December 31, 2015.
Inventory
The Company had $2,755 in raw materials inventory as of December 31, 2016, and $871 as of December 31, 2015, respectively.
Income Taxes
Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.
Revenue Recognition
The Company will recognize revenue in accordance with ASC topic 605 Revenue Recognition. The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
22
ILLUMITRY CORP.
NOTES TO THE AUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016 AND DECEMBER 31, 2015
NOTE 3 SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES (CONTINUED)
Fair Value of Financial Instruments
AS topic 820 "Fair Value Measurements and Disclosures" establishes a three-tier fair value hierarchy, which prioritizes the inputs in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market.
These tiers include:
Level 1:
defined as observable inputs such as quoted prices in active markets;
Level 2:
defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and
Level 3:
defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
The carrying value of cash and the Companys loan from shareholder approximates its fair value due to their short-term maturity.
Stock-Based Compensation
Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.
Basic Income (Loss) Per Share
The Company computes income (loss) per share in accordance with FASB ASC 260 Earnings per Share. Basic loss per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted income (loss) per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. There were no potentially dilutive debt or equity instruments issued or outstanding as of December 31, 2016.
Comprehensive Income
Comprehensive income is defined as all changes in stockholders' deficit, exclusive of transactions with owners, such as capital investments. Comprehensive income includes net income or loss, changes in certain assets and liabilities that are reported directly in equity such as translation adjustments on investments in foreign subsidiaries and unrealized gains (losses) on available-for-sale securities. As of December 31, 2016, there were no differences between our comprehensive loss and net loss.
Recent Accounting Pronouncements
We have reviewed all the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company.
NOTE 4 LOAN FROM DIRECTOR
As of December 31, 2016, our sole director has loaned to the Company $24,000 pursuant to the Verbal Agreement. This loan is unsecured, non-interest bearing and due on demand.
The balance due to the director was $24,000 as of December 31, 2016, and $10,900 as of December 31, 2015.
23
ILLUMITRY CORP.
NOTES TO THE AUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016 AND DECEMBER 31, 2015
NOTE 5 FIXED ASSETS
|
| Equipment |
| Website |
| Totals |
Cost |
|
|
|
|
|
|
As at December 31, 2015 | $ | 4,452 | $ | 800 | $ | 5,252 |
Additions |
| - |
| - |
| - |
Disposals |
| - |
| - |
| - |
As at December 31, 2016 | $ | 4,452 | $ | 800 | $ | 5,252 |
|
|
|
|
|
|
|
Depreciation |
|
|
|
|
|
|
As at December 31, 2015 |
| 892 |
| - |
| 892 |
Change for the period |
| 892 |
| - |
| 892 |
As at December 31, 2016 | $ | 1,784 | $ | - | $ | 1,784 |
|
|
|
|
|
|
|
Net book value | $ | 2,668 | $ | 800 | $ | 3,468 |
We recognized depreciation expense of $1,784 in respect of equipment as of December 31, 2016. Depreciation was recognized in respect of the website from inception to December 31, 2016, as the website was t operational during the period.
NOTE 6 STOCKHOLDERS EQUITY
The Company has 75,000,000, $0.001 par value shares of common stock authorized.
On November 14, 2014, the company issued a total of 3,000,000 common shares to its founder for a cash contribution of $3,000.
During November 2015, the company issued a total of 25,000 common shares for cash contribution of $484 at $0.02 per share.
During January 2016, the company issued a total of 50,000 common shares for cash contribution of $955 at $0.02 per share.
During February 2016, the company issued a total of 525,000 common shares for cash contribution of $10,392 at $0.02 per share.
During March 2016, the company issued a total of 25,000 common shares for cash contribution of $500 at $0.02 per share.
There were 3,625,000 shares of common stock issued and outstanding as of December 31, 2016.
NOTE 7 RESTATEMENT
As of March 31, 2016, there were adjustments made in the structure of the Companys liabilities and shareholders equity: $500 increase in Loan from Director and $25 decrease in Common Stock and $475 decrease in Additional Paid In Capital, due to error in records of accounting entries.
| As Reported | As Restated |
Loans | 10,900 | 11,400 |
Common Stock | 3,650 | 3,625 |
Additional Paid In Capital | 12,182 | 11,707 |
NOTE 8 COMMITMENTS AND CONTINGENCIES
Company has resigned the one year rental agreement starting on August 16, 2016 and ending on August 16, 2017, with monthly price of $200. The office is 30 square meters in underground passage on Sasunci Davit Square, Yerevan, Armenia.
24
ILLUMITRY CORP.
NOTES TO THE AUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016 AND DECEMBER 31, 2015
NOTE 9 INCOME TAXES
As of December 31, 2016, and December 31, 2015, the Company had net operating loss carry forwards of approximately $29,362 and $8,978 that may be available to reduce future years taxable income in varying amounts through 2031. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.
The provision for Federal income tax consists of the following:
| December 31, 2016 |
| December 31, 2015 |
Federal income tax benefit attributable to: |
|
|
|
Current Operations | $ 6,930 |
| $ 3,018 |
Less: valuation allowance | (6,930) |
| (3,018) |
Net provision for Federal income taxes | $ 0 |
| $ 0 |
The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows:
| December 31, 2016 |
| December 31, 2015 |
Deferred tax asset attributable to: |
|
|
|
Net operating loss carryover | $ 9,983 |
| $ 3,053 |
Less: valuation allowance | (9,983) |
| (3,053) |
Net deferred tax asset | $ 0 |
| $ 0 |
Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of approximately $29,362 as of December 31, 2016, compared to $8,978 as of December 31, 2015, for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur net operating loss carry forwards may be limited as to use in future years.
NOTE 10 SUBSEQUENT EVENTS
CHANGES IN CONTROL OF REGISTRANT
On February 7, 2017, Jaeson Cayne, acquired control of Three Million (3,000,000) restricted shares of the Companys issued and outstanding common stock, representing approximately 83% of the Companys total issued and outstanding common stock, from Arusyak Sukiasyan in exchange for $315,000 per the terms of a Stock Purchase Agreement (the Stock Purchase Agreement) by and between Mr. Cayne and Ms. Sukiasyan.
There are no arrangements or understandings between Ms. Sukiasyan and Mr. Cayne and/or their respective associates with respect to the election of directors or other matters.
The following table sets forth, as of February 21, 2017, the beneficial ownership of the outstanding common stock by: (i) any holder of more than five (5%) percent; (ii) each of our executive officers and directors; and (iii) our directors and executive officers as a group. Unless otherwise indicated, each of the stockholders named in the table below has sole voting and dispositive power with respect to such shares of common stock. As of the date of this Current Report, there are 3,625,000 shares of common stock issued and outstanding.
25
ILLUMITRY CORP.
NOTES TO THE AUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2016 AND DECEMBER 31, 2015
Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percentage of Beneficial Ownership |
Directors and Officers: |
|
|
Jaeson Cayne | 3,000,000 | 83% |
All executive officers and directors as a group (1 person) | 3,000,000 | 83% |
(1) Mr. Jaeson Cayne acquired these shares on February 7, 2017 in a private transaction from Ms. Arusyak Sukiasyan, our former sole officer and director. |
Other than the shareholders listed above, we know of no other person who is the beneficial owner of more than five percent (5%) of our common stock.
There are no arrangements known to the company, the operation of which may, at a subsequent date, result in a change in control of the company.
DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS
On February 21, 2017, (i) Ms. Arusyak Sukiasyan resigned from all positions with the Company, including the sole member of the Companys Board of Directors and the Companys President, Chief Executive Officer, Chief Financial Officer, Secretary and Treasurer. The resignation of Ms. Sukiasyan was not the result of any disagreement with the Company on any matter relating to the Companys operations, policies or practices.
On February 21, 2017, Mr. Collin McMullen was appointed to the Companys Board of Directors and as the Companys President, Chief Executive Officer, Chief Financial Officer, Treasurer, and Secretary.
The following sets forth biographical information for Mr. Collin McMullen is set forth below:
Collin McMullen. age 41: Mr. McMullen has been the head of a youth fitness program in Atlanta since January 2012. While leading the youth fitness program Mr. McMullen has been able to reach out and help many young adults in the Atlanta area and become a major catalyst in helping these young adults lead healthier more active lifestyles. Mr. McMullens responsibilities at the fitness center revolve around fitness training at the group and personal levels, as well as working with athletes in competitive running. Since 2014, Mr. McMullen has also been the Staff Pastor at his church where he specializes in the continuing education of young adults; thereby, furthering his mentor position at the youth fitness center. The Company has decided to appoint Mr. McMullen as a Director and Officer, due to his experience operating small organizations and his ability to connect and motivate those people working around him.
There are no family relationships between the Designees.
In accordance with ASC 855-10 the Company has analyzed its operations from December 31, 2016 to February 24, 2017, the date these financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these financial statements.
26
Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
None
Item 9A(T) Controls and Procedures
Disclosure Controls and Procedures.
The Company maintains disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) that are designed to ensure that information required to be disclosed in the Companys Securities Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to the Companys management, as appropriate, to allow timely decisions regarding required disclosure.
The Companys management, with the participation of our principal executive and principal financial officer evaluated the effectiveness of the Companys disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, our principal executive and principal financial officer concluded that, as of the end of the period covered by this report, the Companys disclosure controls and procedures were not effective.
Managements Report on Internal Controls over Financial Disclosure Controls and Procedures
Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)). The Companys internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of the effectiveness of the Companys internal control over financial reporting as of December 31, 2016, using the criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").
A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Companys annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of internal control over financial reporting as of December 31, 2016, the Company determined that there were control deficiencies that constituted material weaknesses, as described below.
1.
We do not have an Audit Committee While not being legally obligated to have an audit committee, it is the managements view that such a committee, including a financial expert member, is an utmost important entity level control over the Companys financial statement. Currently the Board of Directors acts in the capacity of the Audit Committee, and does not include a member that is considered to be independent of management to provide the necessary oversight over managements activities.
2.
We did not maintain appropriate cash controls As of December 31, 2016, the Company has not maintained sufficient internal controls over financial reporting for the cash process, including failure to segregate cash handling and accounting functions, and did not require dual signature on the Companys bank accounts. Alternatively, the effects of poor cash controls were mitigated by the fact that the Company had limited transactions in their bank accounts.
3.
We did not implement appropriate information technology controls As at December 31, 2016, the Company retains copies of all financial data and material agreements; however, there is no formal procedure or evidence of normal backup of the Companys data or off-site storage of data in the event of theft, misplacement, or loss due to unmitigated factors.
Accordingly, the Company concluded that these control deficiencies resulted in a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis by the companys internal controls.
27
As a result of the material weaknesses described above, management has concluded that the Company did not maintain effective internal control over financial reporting as of December 31, 2016, based on criteria established in Internal Control- Integrated Framework issued by COSO.
System of Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commissions rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuers management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
An evaluation was conducted under the supervision and with the participation of our management of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2016. Based on that evaluation, our management concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms.
Changes in Internal Control over Financial Reporting
There was no change in the Companys internal control over financial reporting during the quarterly period covered by this report that has materially affected, or is reasonably likely to materially affect, the Companys internal control over financial reporting.
Item 9B. Other Information.
Subsequent to the year ended December 31, 2016,
CHANGES IN CONTROL OF REGISTRANT
On February 7, 2017, Jaeson Cayne, acquired control of Three Million (3,000,000) restricted shares of the Companys issued and outstanding common stock, representing approximately 83% of the Companys total issued and outstanding common stock, from Arusyak Sukiasyan in exchange for $315,000 per the terms of a Stock Purchase Agreement (the Stock Purchase Agreement) by and between Mr. Cayne and Ms. Sukiasyan.
There are no arrangements or understandings between Ms. Sukiasyan and Mr. Cayne and/or their respective associates with respect to the election of directors or other matters.
The following table sets forth, as of February 21, 2017, the beneficial ownership of the outstanding common stock by: (i) any holder of more than five (5%) percent; (ii) each of our executive officers and directors; and (iii) our directors and executive officers as a group. Unless otherwise indicated, each of the stockholders named in the table below has sole voting and dispositive power with respect to such shares of common stock. As of the date of this Current Report, there are 3,625,000 shares of common stock issued and outstanding.
Name and Address of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percentage of Beneficial Ownership |
Directors and Officers: |
|
|
Jaeson Cayne | 3,000,000 | 83% |
All executive officers and directors as a group (1 person) | 3,000,000 | 83% |
(1) Mr. Jaeson Cayne acquired these shares on February 7, 2017 in a private transaction from Ms. Arusyak Sukiasyan, our former sole officer and director. |
28
Other than the shareholders listed above, we know of no other person who is the beneficial owner of more than five percent (5%) of our common stock.
There are no arrangements known to the company, the operation of which may, at a subsequent date, result in a change in control of the company.
DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS
On February 21, 2017, (i) Ms. Arusyak Sukiasyan resigned from all positions with the Company, including the sole member of the Companys Board of Directors and the Companys President, Chief Executive Officer, Chief Financial Officer, Secretary and Treasurer. The resignation of Ms. Sukiasyan was not the result of any disagreement with the Company on any matter relating to the Companys operations, policies or practices.
On February 21, 2017, Mr. Collin McMullen was appointed to the Companys Board of Directors and as the Companys President, Chief Executive Officer, Chief Financial Officer, Treasurer, and Secretary.
The following sets forth biographical information for Mr. Collin McMullen is set forth below:
Collin McMullen. age 41: Mr. McMullen has been the head of a youth fitness program in Atlanta since January 2012. While leading the youth fitness program Mr. McMullen has been able to reach out and help many young adults in the Atlanta area and become a major catalyst in helping these young adults lead healthier more active lifestyles. Mr. McMullens responsibilities at the fitness center revolve around fitness training at the group and personal levels, as well as working with athletes in competitive running. Since 2014, Mr. McMullen has also been the Staff Pastor at his church where he specializes in the continuing education of young adults; thereby, furthering his mentor position at the youth fitness center. The Company has decided to appoint Mr. McMullen as a Director and Officer, due to his experience operating small organizations and his ability to connect and motivate those people working around him.
There are no family relationships between the Designees.
29
PART III
Item 10. Directors, Executive Officers, Promoters and Control Persons of the Company
DIRECTORS AND EXECUTIVE OFFICERS
The name, age and titles of our sole officer and director are as follows:
Name and Address of Executive Officer and/or Director | Age | Position |
Collin McMullen, P.O. Box 2551, Carlsbad, CA 92018 | 41 | President, Treasurer, Secretary and Director (Principal Executive, Financial and Accounting Officer) |
Arusyak Sukiasyan 53, Ayasa, Yerevan, Armenia | 41 | Former - President, Treasurer, Secretary and Director (Former - Principal Executive, Financial and Accounting Officer) |
Biographical Information and Background of officer and director
Collin McMullen. age 41: Mr. McMullen has been the head of a youth fitness program in Atlanta since January 2012. While leading the youth fitness program Mr. McMullen has been able to reach out and help many young adults in the Atlanta area and become a major catalyst in helping these young adults lead healthier more active lifestyles. Mr. McMullens responsibilities at the fitness center revolve around fitness training at the group and personal levels, as well as working with athletes in competitive running. Since 2014, Mr. McMullen has also been the Staff Pastor at his church where he specializes in the continuing education of young adults; thereby, furthering his mentor position at the youth fitness center. The Company has decided to appoint Mr. McMullen as a Director and Officer, due to his experience operating small organizations and his ability to connect and motivate those people working around him.
During the past ten years, Mr. McMullen has not been the subject to any of the following events:
1.
Any bankruptcy petition filed by or against any business of which Mr. McMullen was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time.
2.
Any conviction in a criminal proceeding or being subject to a pending criminal proceeding.
3.
An order, judgment, or decree, not subsequently reversed, suspended or vacated, or any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting Mr. McMullens involvement in any type of business, securities or banking activities.
4.
Found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Future Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.
5.
Was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right to engage in any activity described in paragraph (f)(3)(i) of this section, or to be associated with persons engaged in any such activity;
6.
Was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;
7.
Was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:
i.
Any Federal or State securities or commodities law or regulation; or
ii.
Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or
iii.
Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
8.
Was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent
30
exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
AUDIT COMMITTEE
We do not have an audit committee financial expert. We do not have an audit committee financial expert because we believe the cost related to retaining a financial expert at this time is prohibitive. Further, because we have no operations, at the present time, we believe the services of a financial expert are not warranted.
SIGNIFICANT EMPLOYEES
We have no employees other than our sole director Mr. McMullen. We intend to hire employees on an as needed basis.
Item 11. Executive Compensation
The following tables set forth certain information about compensation paid, earned or accrued for services by our President, and Secretary (collectively, the Named Executive Officers) from inception on October 17, 2014 until December 31, 2016:
Summary Compensation Table
Name and Principal Position |
| Period |
| Salary ($) |
|
| Bonus ($) |
|
| Stock Awards ($) |
|
| Option Awards ($) |
|
| Non-Equity Incentive Plan Compensation ($) |
|
| Nonqualified Deferred Compensation ($) |
|
| All Other Compensation ($) |
|
| Total ($) |
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Arusyak Sukiasyan, Former President and Treasurer |
| December 31, 2015 to December 31, 2016 |
|
| -0- |
|
|
| -0- |
|
|
| -0- |
|
|
| -0- |
|
|
| -0- |
|
|
| -0- |
|
|
| -0- |
|
|
| -0- |
|
There are no current employment agreements between the company and its officers. The compensation discussed herein addresses all compensation awarded to, earned by, or paid to our named executive officer. There are no other stock option plans, retirement, pension, or profit sharing plans for the benefit of our officers and directors other than as described herein.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following table sets forth certain information concerning the number of shares of our common stock owned beneficially as of March 2, 2017 by: (i) each person (including any group) known to us to own more than five percent (5%) of any class of our voting securities, (ii) our director, and or (iii) our officer. Unless otherwise indicated, the stockholder listed possesses sole voting and investment power with respect to the shares shown.
The percent of class is based on 3,625,000 shares of common stock issued and outstanding as of the date of this annual report.
Item 13. Certain Relationships and Related Transactions
During the year ended December 31, 2016, we had not entered into any transactions with our sole officer or director, or persons nominated for these positions, beneficial owners of 5% or more of our common stock, or family members of these persons wherein the amount involved in the transaction or a series of similar transactions exceeded the lesser of $120,000 or 1% of the average of our total assets for the last three fiscal years.
31
As of December 31, 2016, a former director had loaned $24,000 (December 31, 2015 - $10,900) to the Company to provide working capital for its business operations. The loan is unsecured, non-interest bearing and due on demand.
Item 14. Principal Accountant Fees and Services
During fiscal year ended December 31, 2016, we incurred approximately $8,200 in fees to our principal independent accountants for professional services rendered in connection with the audit of our December 31, 2015 financial statements and for the reviews of our financial statements for the quarters ended March 31, 2016, June 30, 2016, and September 30, 2016.
32
PART IV
Item 15. Exhibits
The following exhibits are included as part of this report by reference:
31.1 |
| Certification of Chief Executive Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a). |
|
|
|
31.2 |
| Certification of Chief Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a). |
|
|
|
32.1 |
| Certifications pursuant to Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002. |
33
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
34