U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-K

 

(Mark One)

 

[X]  ANNUAL REPORT UNDER THE SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended December 31, 2016

 

[ ]TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______________ to ______________

 

 

ANDES 7 Inc.

(Exact name of registrant as specified in its charter)

 

 

	Delaware		47-4683655
	(State or Other Jurisdiction of		(I.R.S. Employer
	Incorporation or Organization)		Identification No.)
	424 Clay Street, Lower Level San Francisco, CA
			94111
	(Address of Principal Executive Offices)		(Zip Code)

 

Securities registered under Section 12(b) of the Exchange Act:
None.

Securities registered under Section 12(g) of the Exchange Act:

Common Stock, $0.0001 par value per share
(Title of Class)

 

Check whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. [ ] Yes [X] No

Check whether the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. [ ] Yes [X] No

 

Check whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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. [X] Yes [ ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). 
[ ] Yes [X] No

 

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-K (§229.405 of this chapter) contained herein, and no disclosure will be contained, to the best of registrant’s 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. [X]

Check whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See 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): 

[X] Yes [ ] No

The issuer’s common stock is not currently quoted on any market. The issuer therefore cannot estimate the aggregate market value of the issuer’s voting and non-voting common equity held as of June 30, 2016, the last day of the registrant’s most recently completed second fiscal quarter, by non-affiliates of the issuer. As of May 4, 2017, there were 10,100,000 shares of $0.0001 par value common stock issued and outstanding.

 

 

TABLE OF CONTENTS
		Page
PART I
Item 1.	Business	5
Item 1A.	Risk Factors	7
Item 1B.	Unresolved Staff Comments	11
Item 2.	Properties	11
Item 3.	Legal Proceedings	11
Item 4.	Mine Safety Disclosures	11
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	11
Item 6.	Selected Financial Data	13
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
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	16
Item 9A.	Controls and Procedures	16
Item 9B.	Other Information	17
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	18
Item 11.	Executive Compensation	19
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	20
Item 13.	Certain Relationships and Related Transactions, and Director Independence	20
Item 14.	Principal Accountant Fees and Services	22
PART IV
Item 15.	Exhibits, Financial Statement Schedules	23

 

 

 

FORWARD-LOOKING STATEMENTS

 

Certain statements made in this Annual Report on Form 10-K are “forward-looking statements” (within the meaning of the Private Securities Litigation Reform Act of 1995) regarding the plans and objectives of management for future operations. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of ANDES 7 Inc.(the “Company”) to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. The Company’s plans and objectives are based, in part, on assumptions involving the continued expansion of business. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of the Company. Although the Company believes its assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance the forward-looking statements included in this Report will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the objectives and plans of the Company will be achieved.

 

 

PART I

Item 1.   Description of Business.

  

(a)   Business Development

 

ANDES 7 Inc. ("Company" or the "Registrant") was incorporated under the laws of the State of Delaware on July 27, 2015 and has been inactive since inception. On February 12, 2016, following the entry of (a) the Consent in Lieu of Shareholder Meeting, and the (b) Resolutions of the Board of Directors, and (c) Resolutions of the Board of Directors all dated on February 12, 2016, the following events occurred which resulted in a change of control of the Company. The Company redeemed an aggregate of 9,900,000 from its former sole shareholder of the then 10,000,000 shares of outstanding stock held at a redemption price of $0.0001 per share for an aggregate redemption price of $990. The former sole shareholder proceeded to resign from his director and officer positions. As the sole shareholder at the time, and prior to his resignation as the sole director, former sole shareholder appointed Andrew Khor Poh Kiang to serve as director on the Board of Directors.

 

The Company intends to serve as a vehicle to effect an asset acquisition, merger, exchange of capital stock or other business combination with a domestic or foreign business. ANDES 7 Inc. has been in the developmental stage since inception and its operations to date have been limited to issuing shares to its original shareholders and filing a registration statement. ANDES 7 Inc. has been formed to provide a method for a foreign or domestic private company to become a reporting company with a class of securities registered under the Securities Exchange Act of 1934. 

 

The Company registered its common stock on a Form 10 registration statement filed pursuant to the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 12(g) thereof. The Company files with the Securities and Exchange Commission periodic and current reports under Rule 13(a) of the Exchange Act, including quarterly reports on Form 10-Q and annual reports Form 10-K.

 

To become a publicly-traded company, ANDES 7 Inc. may file a registration statement; most likely on Form S-1, or alternatively that a company first effect a business combination with ANDES 7 Inc. and then subsequently file a registration statement. A company may choose to effect a business combination with ANDES 7 Inc. before filing a registration statement.

 

If a target company chooses to enter into business combination with ANDES 7 Inc., the registration statement will be prepared after such business combination. The terms of a business combination may provide for redemption of all or part of their stock in ANDES 7 Inc., usually at par.

 

(b)   Business of Issuer

 

Based on proposed business activities, we are a “blank check” company. The SEC defines those companies as “any development stage company that is issuing a penny stock, within the meaning of Section 3 (a)(51) of the Exchange Act, and that has no specific business plan or purpose, or has indicated that its business plan is to merge with an unidentified company or companies.” Many states have enacted statutes, rules and regulations limiting the sale of securities of “blank check” companies in their respective jurisdictions. Management does not intend to undertake any efforts to cause a market to develop in our securities, either debt or equity, until we have successfully concluded a business combination. We intend to comply with the periodic reporting requirements of the Exchange Act for so long as we are subject to those requirements.

We were organized as a vehicle to investigate and, if such investigation warrants, acquire a target company or business seeking the perceived advantages of being a publicly held corporation. Our principal business objective for the next 12 months and beyond such time will be to achieve long-term growth potential through a combination with a business rather than immediate, short-term earnings. We will not restrict our potential candidate target companies to any specific business, industry or geographical location and, thus, may acquire any type of business.

 

 

The analysis of new business opportunities has and will be undertaken by or under the supervision of the officers and directors of the Registrant. The Registrant has considered potential acquisition transactions with several companies, but as of this date has not entered into any Letter of Intent or other agreement with any party. The Registrant has unrestricted flexibility in seeking, analyzing and participating in potential business opportunities. In its efforts to analyze potential acquisition targets, the Registrant will consider the following kinds of factors:

 

(a) Potential for growth, indicated by new technology, anticipated market expansion or new products;

(b) Competitive position as compared to other firms of similar size and experience within the industry segment as well as within the industry as a whole;

(c) Strength and diversity of management, either in place or scheduled for recruitment;

(d) Capital requirements and anticipated availability of required funds, to be provided by the Registrant or from operations, through the sale of additional securities, through joint ventures or similar arrangements or from other sources;

(e) The cost of participation by the Registrant as compared to the perceived tangible and intangible values and potentials;

(f) The extent to which the business opportunity can be advanced;

(g) The accessibility of required management expertise, personnel, raw materials, services, professional assistance and other required items; and

(h) Other relevant factors.

  

In applying the foregoing criteria, no one of which will be controlling, management will attempt to analyze all factors and circumstances and make a determination based upon reasonable investigative measures and available data. Potentially available business opportunities may occur in many different industries, and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex. Due to the Registrant’s limited capital available for investigation, the Registrant may not discover or adequately evaluate adverse facts about the opportunity to be acquired.

  

A combination will normally take the form of a merger, stock-for-stock exchange or stock-for-assets exchange. In most instances the target company will wish to structure the business combination to be within the definition of a tax-free reorganization under Section 351 or Section 368 of the Internal Revenue Code of 1986, as amended and described within the section Form of Acquisition.

 

Once a change of control of ANDES 7 Inc. has been effected, if at all, new management may issue shares of its stock prior to filing a registration statement for the registration of its shares pursuant to the Securities Act of 1933 and such shares will be governed by the rules and regulations of the Securities and Exchange Commission regarding the sale of unregistered securities.

 

Form of Acquisition

 

The manner in which the Registrant participates in an opportunity will depend upon the nature of the opportunity, the respective needs and desires of the Registrant and the promoters of the opportunity, and the relative negotiating strength of the Registrant and such promoters.

It is likely that the Registrant will acquire its participation in a business opportunity through the issuance of common stock or other securities of the Registrant. Although the terms of any such transaction cannot be predicted, it should be noted that in certain circumstances the criteria for determining whether or not an acquisition is a so-called “tax free” reorganization under Section 368(a)(1) of the Internal Revenue Code of 1986, as amended (the “Code”), depends upon whether the owners of the acquired business own 80% or more of the voting stock of the surviving entity. If a transaction were structured to take advantage of these provisions rather than other “tax free” provisions provided under the Code, all prior stockholders would in such circumstances retain 20% or less of the total issued and outstanding shares of the surviving entity. Under other circumstances, depending upon the relative negotiating strength of the parties, prior stockholders may retain substantially less than 20% of the total issued and outstanding shares of the surviving entity. This could result in substantial additional dilution to the equity of those who were stockholders of the Registrant prior to such reorganization.

 

 

The present stockholders of the Registrant will likely not have control of a majority of the voting shares of the Registrant following a reorganization transaction. As part of such a transaction, all or a majority of the Registrant’s directors may resign and new directors may be appointed without any vote by stockholders.

 

In the case of an acquisition, the transaction may be accomplished upon the sole determination of management without any vote or approval by stockholders. In the case of a statutory merger or consolidation directly involving us, it will likely be necessary to call a stockholders’ meeting and obtain the approval of the holders of a majority of the outstanding shares. The necessity to obtain such stockholder approval may result in delay and additional expense in the consummation of any proposed transaction and will also give rise to certain appraisal rights to dissenting stockholders. Most likely, management will seek to structure any such transaction so as not to require stockholder approval.

 

It is anticipated that the investigation of specific business opportunities and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require substantial management time and attention and substantial cost for accountants, attorneys and others. If a decision is made not to participate in a specific business opportunity, the costs theretofore incurred in the related investigation would not be recoverable. Furthermore, even if an agreement is reached for the participation in a specific business opportunity, the failure to consummate that transaction may result in the loss to the Registrant of the related costs incurred.

 

We presently have no employees. Our officer and director is engaged in outside business activities and anticipate that he will devote to our business only several hours per week until the acquisition of a successful business opportunity has been consummated. We expect no significant changes in the number of our employees other than such changes, if any, incident to a business combination.

 

Item 1A. Risk Factors.

 

Risk Factors

 

An investment in the company is highly speculative in nature and involves an extremely high degree of risk.

 

Our Business Is Difficult To Evaluate Because We Have No Operating History.

 

As we have no operating history or revenue and only minimal assets, there is a risk that we will be unable to continue as a going concern and consummate a business combination. We have had no recent operating history nor any revenues or earnings from operations since inception. We have no significant assets or financial resources. We will, in all likelihood, sustain operating expenses without corresponding revenues, at least until the consummation of a business combination. This may result in our incurring a net operating loss that will increase continuously until we can consummate a business combination with a profitable business opportunity. We cannot assure you that we can identify a suitable business opportunity and consummate a business combination.

 

There Is Competition For Those Private Companies Suitable For A Merger Transaction Of The Type Contemplated By Management.

 

We are in a highly competitive market for a small number of business opportunities which could reduce the likelihood of consummating a successful business combination. We are and will continue to be an insignificant participant in the business of seeking mergers with, joint ventures with and acquisitions of small private and public entities. A large number of established and well-financed entities, including small public companies and venture capital firms, are active in mergers and acquisitions of companies that may be desirable target candidates for us. Nearly all these entities have significantly greater financial resources, technical expertise and managerial capabilities than we do; consequently, we will be at a competitive disadvantage in identifying possible business opportunities and successfully completing a business combination. These competitive factors may reduce the likelihood of our identifying and consummating a successful business combination.

 

 

Future Success Is Highly Dependent On The Ability Of Management To Locate And Attract A Suitable Acquisition.

 

The nature of our operations is highly speculative and there is a consequent risk of loss of your investment. The success of our plan of operation will depend to a great extent on the operations, financial condition and management of the identified business opportunity. While management intends to seek business combination(s) with entities having established operating histories, we cannot assure you that we will be successful in locating candidates meeting that criterion. In the event we complete a business combination, the success of our operations may be dependent upon management of the successor firm or venture partner firm and numerous other factors beyond our control.

 

The Company Has No Existing Agreement For A Business Combination Or Other Transaction.

 

We have no arrangement, agreement or understanding with respect to engaging in a merger with, joint venture with or acquisition of, a private or public entity. No assurances can be given that we will successfully identify and evaluate suitable business opportunities or that we will conclude a business combination. Management has not identified any particular industry or specific business within an industry for evaluation. We cannot guarantee that we will be able to negotiate a business combination on favorable terms, and there is consequently a risk that funds allocated to the purchase of our shares will not be invested in a company with active business operations.

 

Management Intends To Devote Only A Limited Amount Of Time To Seeking A Target Company Which May Adversely Impact Our Ability To Identify A Suitable Acquisition Candidate.

 

While seeking a business combination, management anticipates devoting no more than a few hours per week to our affairs. Our officers have not entered into written employment agreements with us and are not expected to do so in the foreseeable future. This limited commitment may adversely impact our ability to identify and consummate a successful business combination.

 

The Time And Cost Of Preparing A Private Company To Become A Public Reporting Company May Preclude Us From Entering Into A Merger Or Acquisition With The Most Attractive Private Companies.

 

Target companies that fail to comply with SEC reporting requirements may delay or preclude acquisition. Sections 13 and 15(d) of the Exchange Act require reporting companies to provide certain information about significant acquisitions, including certified financial statements for the company acquired, covering one, two, or three years, depending on the relative size of the acquisition. The time and additional costs that may be incurred by some target entities to prepare these statements may significantly delay or essentially preclude consummation of an acquisition. Otherwise suitable acquisition prospects that do not have or are unable to obtain the required audited statements may be inappropriate for acquisition so long as the reporting requirements of the Exchange Act are applicable.

 

The Company May Be Subject To Further Government Regulation Which Would Adversely Affect Our Operations.

 

Although we will be subject to the reporting requirements under the Exchange Act, management believes we will not be subject to regulation under the Investment Company Act of 1940, as amended (the “Investment Company Act”), since we will not be engaged in the business of investing or trading in securities. If we engage in business combinations which result in our holding passive investment interests in a number of entities, we could be subject to regulation under the Investment Company Act. If so, we would be required to register as an investment company and could be expected to incur significant registration and compliance costs. We have obtained no formal determination from the Securities and Exchange Commission as to our status under the Investment Company Act and, consequently, violation of the Act could subject us to material adverse consequences.

 

 

Any Potential Acquisition Or Merger With A Foreign Company May Subject Us To Additional Risks.

 

If we enter into a business combination with a foreign concern, we will be subject to risks inherent in business operations outside of the United States. These risks include, for example, currency fluctuations, regulatory problems, punitive tariffs, unstable local tax policies, trade embargoes, risks related to shipment of raw materials and finished goods across national borders and cultural and language differences. Foreign economies may differ favorably or unfavorably from the United States economy in growth of gross national product, rate of inflation, market development, rate of savings, and capital investment, resource self-sufficiency and balance of payments positions, and in other respects.

 

There Is Currently No Trading Market For Our Common Stock.

 

Outstanding shares of our Common Stock cannot be offered, sold, pledged or otherwise transferred unless subsequently registered pursuant to, or exempt from registration under, the Securities Act and any other applicable federal or state securities laws or regulations. These restrictions will limit the ability of our stockholders to liquidate their investment.

 

 

Our Business Will Have No Revenues Unless And Until We Merge With Or Acquire An Operating Business.

 

We are a development stage company and have had no revenues from operations. We may not realize any revenues unless and until we successfully merge with or acquire an operating business.

 

The Company Intends To Issue More Shares In A Merger Or Acquisition, Which Will Result In Substantial Dilution.

 

Our certificate of incorporation authorizes the issuance of a maximum of 1,000,000,000 shares of common stock, as amended, and a maximum of 5,000,000 shares of preferred stock. Any merger or acquisition effected by us may result in the issuance of additional securities without stockholder approval and may result in substantial dilution in the percentage of our common stock held by our then existing stockholders. Moreover, the common stock issued in any such merger or acquisition transaction may be valued on an arbitrary or non-arm’s-length basis by our management, resulting in an additional reduction in the percentage of common stock held by our then existing stockholders. Our Board of Directors has the power to issue any or all of such authorized but unissued shares without stockholder approval. To the extent that additional shares of Common Stock or Preferred Stock are issued in connection with a business combination or otherwise, dilution to the interests of our stockholders will occur and the rights of the holders of Common Stock might be materially adversely affected.

 

The Company Has Conducted No Market Research Or Identification Of Business Opportunities, Which May Affect Our Ability To Identify A Business To Merge With Or Acquire.

 

We have neither conducted nor have others made available to us results of market research concerning prospective business opportunities. Therefore, we have no assurances that market demand exists for a merger or acquisition as contemplated by us. Our management has not identified any specific business combination or other transactions for formal evaluation by us, such that it may be expected that any such target business or transaction will present such a level of risk that conventional private or public offerings of securities or conventional bank financing will not be available. There is no assurance that we will be able to acquire a business opportunity on terms favorable to us. Decisions as to which business opportunity to participate in will be unilaterally made by our management, which may act without the consent, vote or approval of our stockholders.

 

 

Because We May Seek To Complete A Business Combination Through A “Reverse Merger”, Following Such A Transaction We May Not Be Able To Attract The Attention Of Major Brokerage Firms.

 

Additional risks may exist since we will assist a privately held business to become public through a “reverse merger.” Securities analysts of major brokerage firms may not provide coverage of our Company since there is no incentive to brokerage firms to recommend the purchase of our common stock. No assurance can be given that brokerage firms will want to conduct any secondary offerings on behalf of our post-merger company in the future.

 

We Cannot Assure You That Following A Business Combination With An Operating Business; Our Common Stock Will Be Listed On NASDAQ Or Any Other Securities Exchange.

 

Following a business combination, we may seek the listing of our common stock on NASDAQ or the American Stock Exchange. However, we cannot assure you that following such a transaction, we will be able to meet the initial listing standards of either of those or any other stock exchange, or that we will be able to maintain a listing of our common stock on either of those or any other stock exchange. After completing a business combination, until our common stock is listed on the NASDAQ or another stock exchange, we expect that our common stock would be eligible to trade on the OTC Bulletin Board, another over-the-counter quotation system, or on the “pink sheets,” where our stockholders may find it more difficult to dispose of shares or obtain accurate quotations as to the market value of our common stock. In addition, we would be subject to an SEC rule that, if it failed to meet the criteria set forth in such rule, imposes various practice requirements on broker-dealers who sell securities governed by the rule to persons other than established customers and accredited investors. Consequently, such rule may deter broker-dealers from recommending or selling our common stock, which may further affect its liquidity. This would also make it more difficult for us to raise additional capital following a business combination.

 

 

There Is No Public Market For Our Common Stock, Nor Have We Ever Paid Dividends On Our Common Stock.

 

There is no public trading market for our common stock and none is expected to develop in the foreseeable future unless and until we complete a business combination with an operating business and such business files a registration statement under the Securities Act of 1933, as amended.

 

Additionally, we have never paid dividends on our Common Stock and do not presently intend to pay any dividends in the foreseeable future. We anticipate that any funds available for payment of dividends will be re-invested into the Company to further its business strategy.

 

Authorization of Preferred Stock.

 

Our Certificate of Incorporation authorizes the issuance of up to 5,000,000 shares of preferred stock with designations, rights and preferences determined from time to time by its Board of Directors. Accordingly, our Board of Directors is empowered, without stockholder approval, to issue preferred stock with dividend, liquidation, conversion, voting, or other rights which could adversely affect the voting power or other rights of the holders of the common stock. In the event of issuance, the preferred stock could be utilized, under certain circumstances, as a method of discouraging, delaying or preventing a change in control of the Company. Although we have no present intention to issue any shares of its authorized preferred stock, there can be no assurance that we will not do so in the future.

 

Control by Management.

Management does not directly control of all the issued and outstanding common stock of the Company. Abina Asean, Co. Ltd an entity owned and controlled by our President, Chief Executive Officer and Chairman, Andrew Khor Poh Kiang holds 79% of our outstanding common stock. Additionally, ABINA Company Ltd recently acquired 1,000,000 shares of common stock from a former shareholder. Both Abina Asean Co. Ltd and ABINA Company Ltd. are controlled by Andrew Khor Poh Kiang and his wife, Manichan Khor. Therefore, our President, Chief Executive Officer and Chairman, Andrew Khor Poh Kiang is an indirect owner of 89% of our common stock through these controlled entities. Consequently, he has the ability to control the operations of the Company and will have the ability to control substantially all matters submitted to stockholders for approval, including:

 

 

•	Election of the board of directors;
•	Removal of any directors;
•	Amendment of the Company’s certificate of incorporation or bylaws; and
•	Adoption of measures that could delay or prevent a change in control or impede a merger, takeover or other business combination.

 

Abina Asean Co Ltd and ABINA Company Ltd both an entities owned and controlled by our President, Chief Executive Officer and Chairman, Andrew Khor Poh Kiang and his wife Manichan Khor are indirect beneficial owner of 9,000,000 shares, or 89% of our common stock. Accordingly, this concentration of ownership by itself may have the effect of impeding a merger, consolidation, takeover or other business consolidation, or discouraging a potential acquirer from making a tender offer for the common stock.

 

This Report Contains Forward-Looking Statements And Information Relating To Us, Our Industry And To Other Businesses.

 

These forward-looking statements are based on the beliefs of our management, as well as assumptions made by and information currently available to our management. When used in this Form 10-K, the words “estimate,” “project,” “believe,” “anticipate,” “intend,” “expect” and similar expressions are intended to identify forward-looking statements. These statements reflect our current views with respect to future events and are subject to risks and uncertainties that may cause our actual results to differ materially from those contemplated in our forward-looking statements. We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date of this Form 10-K. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this Form 10-K or to reflect the occurrence of unanticipated events.

 

Item 1B.  Unresolved Staff Comments.

 

None.

 

Item 2.   Description of Property.

 

We maintain a virtual office space at our location 424 Clay Street, Lower Level, San Francisco, CA 94111. We do not own any properties. We currently have no policy with respect to investments or interests in real estate, real estate mortgages or securities of, or interests in, persons primarily engaged in real estate activities.

 

Item 3.   Legal Proceedings.

 

There are not presently any material pending legal proceedings to which the Registrant is a party or as to which any of its property is subject, and no such proceedings are known to the Registrant to be threatened or contemplated against it.

 

Item 4.   Mine Safety Disclosures.

 

Not applicable.

 

 

PART II

 

Item 5.   Market for Common Equity, Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities.

 

Common Stock

 

Our Certificate of Incorporation authorizes the issuance of up to 1,000,000,000 shares of common stock, par value $.0001 per share (the “Common Stock”) as amended. The Common Stock is not listed on a publicly-traded market or exchange. As of December 31, 2016, there were4 holders of record of the Common Stock.

 

Preferred Stock

 

Our Certificate of Incorporation authorizes the issuance of up to 5,000,000 shares of preferred stock, par value $.0001 per share (the “Preferred Stock”). The Company has not yet issued any of its preferred stock.

 

Dividends

 

We have not paid any dividends on our common stock to date and do not intend to pay dividends prior to the completion of a business combination. The payment of dividends in the future will be contingent upon our revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of a business combination. The payment of any dividends subsequent to a business combination will be within the discretion of our then board of directors. It is the present intention of our board of directors to retain all earnings, if any, for use in our business operations and, accordingly, our board does not anticipate declaring any dividends in the foreseeable future.

 

Securities Authorized for Issuance under Equity Compensation Plans

 

The Company does not have any equity compensation plans or any individual compensation arrangements with respect to its common stock or preferred stock. The issuance of any of our common or preferred stock is within the discretion of our Board of Directors, which has the power to issue any or all of our authorized but unissued shares without stockholder approval.

 

Recent Sales of Unregistered Securities

 

On January 19, 2017, Toh Kean Ban sold 1,000,000 shares of our common stock at $0.00225 to ABINA Company Ltd., a corporation controlled by our President, CEO and Chairman, Andrew Khor Poh Kiang and his wife, Manichan Khor.

 

 

Both parties relied upon Section 4(2) of the Securities Act of 1933, as amended for the above issuances. We believed that Section 4(2) was available because:

 

	•	None of these issuances involved underwriters, underwriting discounts or commissions;
	•	We placed restrictive legends on all certificates issued;
	•	No sales were made by general solicitation or advertising;
	•	Sales were made only to accredited investors

 

In connection with the above transactions, we provided the following to all investors:

 

	•	Access to all our books and records.
	•	Access to all material contracts and documents relating to our operations.
	•	The opportunity to obtain any additional information, to the extent we possessed such information, necessary to verify the accuracy of the information to which the investors were given access.

 

The Company may develop its business plan by future acquisitions or mergers but no agreements have been reached regarding any acquisition or other business combination. If the Company makes any acquisitions, mergers or other business combination, the Company will file a Form 8-K but until such time the Company remains a shell company.

 

The Company’s Board of Directors has the power to issue any or all of the authorized but unissued Common Stock without stockholder approval. The Company currently has no commitments to issue any shares of common stock. However, the Company will, in all likelihood, issue a substantial number of additional shares in connection with a business combination. Since the Company expects to issue additional shares of common stock in connection with a business combination, existing stockholders of the Company may experience substantial dilution in their shares. However, it is impossible to predict whether a business combination will ultimately result in dilution to existing shareholders. If the target has a relatively weak balance sheet, a business combination may result in significant dilution. If a target has a relatively strong balance sheet, there may be little or no dilution.

 

Issuer Purchases of Equity Securities

 

None.

 

Item 6.  Selected Financial Data

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

 

Item 7.   Management’s Discussion and Analysis of Financial Condition and Results of Operation.

 

 

ANDES 7 Inc. has no operations nor does it currently engage in any business activities generating revenues. ANDES 7 Inc's principal business objective is to achieve a business combination with a target company.

 

Operating Expenses

 

General and administrative expenses were $20,181 for the year ended December 31, 2016 compared to $3,869 for the period from July 27, 2015 (inception) through December 31, 2015. General and administrative expense consists of professional fees related to the requirements of SEC filings.

 

 

Net Loss

 

Net loss for the year ended December 31, 2016 was $20,181 compared to $3,869 for the period from July 27, 2015 (inception) through December 31, 2015. Net loss is due to general and administrative expenses as discussed above.

 

ANDES 7 Inc. ("Company" or the "Registrant") was incorporated under the laws of the State of Delaware on July 27, 2015 and has been inactive since inception. On February 12, 2016, following the entry of (a) the Consent in Lieu of Shareholder Meeting, and the (b) Resolutions of the Board of Directors, and (c) Resolutions of the Board of Directors all dated on February 12, 2016, the following events occurred which resulted in a change of control of the Company. The Company redeemed an aggregate of 9,900,000 from its former sole shareholder of the then 10,000,000 shares of outstanding stock held at a redemption price of $0.0001 per share for an aggregate redemption price of $990. The former sole shareholder proceeded to resign from his director and officer positions. As the sole shareholder at the time, and prior to his resignation as the sole director, former sole shareholder appointed Andrew Khor Poh Kiang to serve as director on the Board of Directors.

 

The Company intends to serve as a vehicle to effect an asset acquisition, merger, exchange of capital stock or other business combination with a domestic or foreign business. ANDES 7 Inc. has been in the developmental stage since inception and its operations to date have been limited to issuing shares to its original shareholders and filing a registration statement. ANDES 7 Inc. has been formed to provide a method for a foreign or domestic private company to become a reporting company with a class of securities registered under the Securities Exchange Act of 1934. 

 

The Company registered its common stock on a Form 10 registration statement filed pursuant to the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 12(g) thereof. The Company files with the Securities and Exchange Commission periodic and current reports under Rule 13(a) of the Exchange Act, including quarterly reports on Form 10-Q and annual reports Form 10-K.

 

To become a publicly-traded company, ANDES 7 Inc. may file a registration statement; most likely on Form S-1, or alternatively that a company first effect a business combination with ANDES 7 Inc. and then subsequently file a registration statement. A company may choose to effect a business combination with ANDES 7 Inc. before filing a registration statement.

 

If a target company chooses to enter into business combination with ANDES 7 Inc., the registration statement will be prepared after such business combination. The terms of a business combination may provide for redemption of all or part of their stock in ANDES 7 Inc., usually at par.

 

A combination will normally take the form of a merger, stock-for-stock exchange or stock-for-assets exchange. In most instances the target company will wish to structure the business combination to be within the definition of a tax-free reorganization under Section 351 or Section 368 of the Internal Revenue Code of 1986, as amended.

  

No assurances can be given that ANDES 7 Inc. will be successful in locating or negotiating with any target company.

 

The most likely target companies are those seeking the perceived benefits of a reporting corporation. Such perceived benefits may include facilitating or improving the terms on which additional equity financing may be sought, providing liquidity for incentive stock options or similar benefits to key employees, increasing the opportunity to use securities for acquisitions, providing liquidity for shareholders and other factors. Business opportunities may be available in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities difficult and complex.

  

 

In analyzing prospective business opportunities, management may consider such matters as the available technical, financial and managerial resources; working capital and other financial requirements; history of operations, if any; prospects for the future; nature of present and expected competition; the quality and experience of management services which may be available and the depth of that management; the potential for further research, development, or exploration; specific risk factors not now foreseeable but which may be anticipated; the potential for growth or expansion; the potential for profit; the perceived public recognition or acceptance of products, services, or trades; name identification; and other relevant factors. This discussion of the proposed criteria is not meant to be restrictive of the virtually unlimited discretion of the Company to search for and enter into potential business opportunities.

 

The search for a target company will not be restricted to any specific kind of business entities, but may acquire a venture which is in its preliminary or development stage, which is already in operation, or in essentially any stage of its business life. It is impossible to predict at this time the status of any business in which the Company may become engaged, whether such business may need to seek additional capital, may desire to have its shares publicly traded, or may seek other perceived advantages which the Company may offer.

 

In implementing a structure for a particular business acquisition, the Company may become a party to a merger, consolidation, reorganization, joint venture, licensing agreement or other arrangement with another corporation or entity. On the consummation of a transaction, it is likely that the present management and shareholders of the Company will no longer be in control of the Company. In addition, it is likely that the officer and director of the Company will, as part of the terms of the business combination, resign and be replaced by one or more new officers and directors.

 

It is anticipated that any securities issued in any such business combination would be issued in reliance upon exemption from registration under applicable federal and state securities laws. In some circumstances, however, as a negotiated element of its transaction, the Company may agree to register all or a part of such securities immediately after the transaction is consummated or at specified times thereafter. If such registration occurs, it will be undertaken by the surviving entity after the Company has entered into an agreement for a business combination or has consummated a business combination. The issuance of additional securities and their potential sale into any trading market which may develop in the Company's securities may depress the market value of the Company's securities in the future if such a market develops, of which there is no assurance.

 

While the terms of a business transaction to which the Company may be a party cannot be predicted, it is expected that the parties to the business transaction will desire to avoid the creation of a taxable event and thereby structure the acquisition in a tax-free reorganization under Sections 351 or 368 of the Internal Revenue Code of 1986, as amended.

  

The Company will participate in a business combination after the negotiation and execution of appropriate agreements. Although the terms of such agreements cannot be predicted, generally such agreements will require certain representations and warranties of the parties thereto, will specify certain events of default, will detail the terms of closing and the conditions which must be satisfied by the parties prior to and after such closing and will include miscellaneous other terms.

  

The Board of Directors has passed a resolution which contains a policy that the Company will not seek a business combination with any entity in which the Company's officer, director, shareholder serves as an officer or director or holds any ownership interest.

 

2016 Year-End Analysis 

 

The Company has received no income, has had no operations nor expenses, other than Delaware state fees and incorporation and accounting fees as required for incorporation and for the preparation of the Company's financial statements. As of December 31, 2016, the Company had not generated revenues and had no income or cash flows from operations since inception. At December 31, 2016, the Company had sustained a net loss of $20,181.

 

 

Off-Balance Sheet Arrangements

 

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

 

Contractual Obligations

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

 

Item 7A.  Quantitative and Qualitative Disclosures about Market Risk.

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

 

Item 8.   Financial Statements and Supplementary Data.

 

Please see the financial statements beginning on page F-1 located elsewhere in this annual report on Form 10-K and incorporated herein by reference.

 

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

 

There are not and have not been any disagreements between the Company and its accountants on any matter of accounting principles, practices or financial statement disclosure.

 

Item 9A. Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures 

 

The Company’s 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 the Company in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s 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 issuer’s 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.

 

In accordance with Exchange Act Rules 13a-15 and 15d-15, an evaluation was completed under the supervision and with the participation of the Company’s management, including the Company’s President, Principal Financial Officer and Secretary, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of the end of the period covered by this Annual Report. Based on that evaluation, the Company’s sole officer concluded that the Company’s disclosure controls and procedures were effective in providing reasonable assurance that information required to be disclosed in the Company’s reports filed or submitted under the Exchange Act was recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms.

 

Evaluation of Internal Controls over Financial Reporting

 

This annual report does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of the company’s registered public accounting firm due to a transition period established by rules of the Securities and Exchange Commission for newly public companies.

 

 

Changes in Internal Controls over Financial Reporting

 

There have been no significant changes to the Company’s internal controls over financial reporting that occurred during our last fiscal quarter of the year ended December 31, 2016, that materially affected, or were reasonably likely to materially affect, our internal controls over financial reporting.

 

Item 9B. Other Information.

 

Not applicable.

 

 

PART III

 

Item 10. Directors, Executive Officers and Corporate Governance

 

A. Identification of Directors and Officers. The current officers and directors will serve for one year or until their respective successors are elected and qualified. They are:

 

 

Name		Age			Position
Executive Officers
Andrew Khor Poh Kiang			49		President, Chief Executive Officer, Chairman
Lee Kok Keing			54		Chief Financial Officer
Dr. Eric Chin Tek Mun			46		Chief Operations Officer
Jannie Gui Honey			47		Secretary
Dr. Ng Mooi Eng			49		Treasurer

 

  

Biographical Information for Andrew Khor Poh Kiang

 

Andrew Khor Poh Kiang, Age 49, President, Chief Executive Officer, Chairman of the Board of Directors From 2000 to 2002, Mr. Khor was the assistant to Consul General Mr. Wan Jaafar Wan Noor from the Ministry of Foreign Affairs, Malaysia in Thailand. From 2002 to 2006, Mr. Khor was managing SAG Group Company Limited in Thailand, a mining company he controlled that supplied iron ore to China. From 2006 to present, Mr. Khor has been involved in the High Technology area through " The Super Conductivity Maglev System " of Japan Flagship Group " or known as FSG, as its South East Asia Representative, dealing with local governments in South East Asia for the " HIGH SPEED SURFACE TRAIN  " and also appointed by STAR CRUISES, Berjaya Group and Tanjung Rhu Resorts as human resources trainer in hospitality and residential property development. Mr. Khor is the President of Abina Asean Co., Ltd. Mr. Khor holds a Masters of Business Administration from ICS Singapore. 

 

Biographical Information for Lee Kok Keing

 

Lee Kok Keing, Age 54, Chief Financial Officer

Mr. Lee began his career in banking and finance with RHB Bank Berhad from 1979 to 2006, he held various positions and served as branch manager for a few years. From 2006 to 2015, he joined RHB Investment Bank Berhad (formerly OSK Investment Bank) and served in several executive positions as head of branch.

Biographical Information for Dr. Eric Chin Tek Mun

 

Dr. Eric Chin Tek Mun, Age 46, Chief Operations Officer

 

From 2005 to 2011 Dr. Chin was the founder of PDS Group Univision International, an investment and risk management consultancy to government owned entities and to private high net worth individuals. From 2011 to 2014, he became the Chief Operating Officer of Heyu Leisure Holidays Corporation and from 2014 to 2015, he maintains a position as the Chief Operating Officer of Abina Holding Co. Ltd.

 

 

Biographical Information for Jannie Gui Honey

 

Jannie Gui Honey, Age 47, Secretary

 

Ms. Honey was employed by NBE Construction Sdn Bhd for 27 years as an Accounts Clerk; she worked as Sales Manager for Vanhoden Sdn Bhd from 2005 to 2010 and as its Operating Manager from 2010 to 2014. Most recently, she has held the position of Secretary for Abina Company Limited from 2015 to present.

 

Biographical Information for Dr. Ng Mooi Eng

 

Dr. Ng Mooi Eng, Age 49, Treasurer

Dr. Ng has 25 years experience in business managing branding and franchising of women's wear apparel for V-Up Advance Sdn Bhd. Dr. Eng holds a master’s and doctorate in business administration from Ansted University.

 

 

B. Significant Employees.

 

As of the date hereof, the Company has no significant employees.

 

C. Family Relationships.

 

There are no family relationships among directors, executive officers, or persons nominated or chosen by the issuer to become directors or executive officers.

 

D. Involvement in Certain Legal Proceedings.

 

There have been no events under any bankruptcy act, no criminal proceedings and no judgments, injunctions, orders or decrees material to the evaluation of the ability and integrity of any director, executive officer, promoter or control person of Registrant during the past five years.

 

 

Code of Ethics

 

We have not adopted a Code of Business Conduct and Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions in that our sole officer and director serve in these capacities.

  

Nominating Committee

 

We have not adopted any procedures by which security holders may recommend nominees to our Board of Directors. 

 

Audit Committee

 

The Board of Directors acts as the audit committee. The Company does not have a qualified financial expert at this time because it has not been able to hire a qualified candidate. Further, the Company believes that it has inadequate financial resources at this time to hire such an expert. The Company intends to continue to search for a qualified individual for hire.

 

Item 11.   Executive Compensation.

 

Our officer and director does not receive any compensation for services rendered to the Company since inception, has not received such compensation in the past, and is not accruing any compensation pursuant to any agreement with the Company. No remuneration of any nature has been paid for or on account of services rendered by a director in such capacity. Our officers and directors intend to devote no more than (25) twenty-five hours per week to our affairs.

 

 

Our officers and directors will not receive any finder’s fee, either directly or indirectly, as a result of any efforts to implement our business plan outlined herein.

 

It is possible that, after we successfully consummates a business combination with an unaffiliated entity, that entity may desire to employ or retain one or a number of members of our management for the purposes of providing services to the surviving entity. However, we have adopted a policy whereby the offer of any post-transaction employment to members of management will not be a consideration in our decision whether to undertake any proposed transaction.

 

No retirement, pension, profit sharing, stock option or insurance programs or other similar programs have been adopted for the benefit of its employees.

 

There are no understandings or agreements regarding compensation our management will receive after a business combination that is required to be included in this table, or otherwise.

 

Director Compensation

 

We do not currently pay any cash fees to our directors, nor do we pay directors’ expenses in attending board meetings.

 

Employment Agreements

 

The Company is not a party to any employment agreements.

 

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

 

The following table sets forth, as of as of the date of this filing, May 4, 2017, the number of shares of Common Stock owned of record and beneficially by executive officers, directors and persons who hold 5% or more of the outstanding Common Stock of the Company. Also included are the shares held by all executive officers and directors as a group.

 

Name and Address of Beneficial Owner	Title of Class	Amount and Nature of Beneficial Ownership		Percent of Class
Abina Asean, Co. Ltd. (Republic of Seychelles)	Common Stock	8,000,000		79%
ABINA Company Ltd.	Common Stock	1,000,000		10%
Dr. Ir. H.M. Itoc Tochija	Common Stock	1,000,000		10%
Officers and directors as a group		0		0%

       

(1) Abina Asean Co. Ltd and ABINA Company Ltd. are entities controlled by our President, Chief Executive Officer and Chairman, Andrew Khor Poh Kiang. (2) 10,100,000 shares of common stock outstanding as of December 31, 2016, and May 4, 2017.

 

 

 

Item 13. Certain Relationships and Related Transactions.

 

Except as otherwise indicated herein, there have been no related party transactions, or any other transactions or relationships required to be disclosed pursuant to Item 404 of Regulation S-K.

 

Director Independence

 

None.

 

Item 14. Principal Accounting Fees and Services.

 

The following table sets forth the aggregate fees billed to us for the fiscal year ended December 31, 2016 by our independent auditing firm, De Leon & Co, P.A..

 

1)

Audit Fees consist of fees billed for professional services rendered for the audit of our annual financial statements and review of the interim financial statements included in quarterly reports and services that are normally provided by our accountants in connection with statutory and regulatory filings or engagements.

 

2)

Audit-Related Fees consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements and are not reported under “Audit Fees.” This category includes fees related to due diligence services pertaining to potential business acquisitions/disposition; and consultation regarding accounting or disclosure treatment of transactions or events and/or the actual or potential impact of final or proposed rules, standard or interpretation by the SEC, FASB or other regulatory or standard-setting bodies as well as general assistance with implementation of the requirements of SEC rules or listing standards promulgated pursuant to the Sarbanes-Oxley Act of 2002.

 

3)

Tax Fees consist of fees billed for professional services rendered for tax compliance, tax advice and tax planning. These services include assistance regarding federal, state and local tax compliance, planning and advice.

 

4)

All Other Fees consist of fees for products and services other than the services reported above.

 

Our Board of Directors is responsible for approving all Audit, Audit-Related, Tax and Other Services. The Board of Directors pre-approves all auditing services and permitted non-audit services, including all fees and terms to be performed for us by our independent registered public accounting firm at the beginning of the fiscal year. Non-audit services are reviewed and pre-approved by project at the beginning of the fiscal year. Any additional non-audit services contemplated by the Company after the beginning of the fiscal year are submitted to the Board of Directors for pre-approval prior to engaging the independent auditor for such services.

 

Audit Fees

 

The aggregate fees incurred for the period, July 27, 2015 through December 31, 2016 for professional services rendered by the independent registered public accounting firm for the audit of the Company's annual financial statements and review of financial statements included in the Company's Form 10-K and Form 10-Q reports and services normally provided in connection with statutory and regulatory filings or engagements were $10,250.

 

Audit Related Fees

None

Tax Fees

 

There were no fees billed by De Leon & Co, P.A. for professional services for tax compliance, tax advice, and tax planning for the fiscal year ended December 31, 2016.

 

All Other Fees

 

There were no fees billed by De Leon & Co, P.A. for other products and services for the fiscal year ended December 31, 2016.

 

Audit Committee’s Pre-Approval Process

 

The Board of Directors acts as the audit committee of the Company, and accordingly, all services are approved by all the members of the Board of Directors.

 

 

PART IV

 

Item 15. Exhibits, Financial Statement Schedules.

 

(a)

Exhibits:

 

Exhibit	Exhibit Description	Filed herewith	Form	Period ending	Exhibit
3.1	Certificate of Incorporation		10		3.1
3.2	By-Laws		10		3.2
3.3	Certificate of Amendment to Certificate of Incorporation, dated February 25, 2016		8-K		3.3
4.1	Specimen Stock Certificate		10		4.1
99.1	Consent in Lieu of Shareholder Meeting, dated, February 12, 2016		8-K		99.1
99.2	Resolutions of the Board of Directors, dated, February 12, 2016		8-K		99.2
99.3	Resolutions of the Board of Directors, dated, February 12, 2016		8-K		99.3
99.4	Stock Subscription Agreement, Abina Asean Co. Ltd.		8-K		99.4
99.5	Stock Subscription Agreement, Toh Kean Ban		8-K		99.5
99.6	Stock Subscription Agreement, Dr. Ir. H.M Itoc Tochija		8-K		99.6
31	Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	X
32	Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	X
101.INS	XBRL Instance Document	X
101.SCH	XBRL Taxonomy Extension Schema Document	X
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document	X
101.LAB	XBRL Taxonomy Extension Label Linkbase Document	X
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document	X
101.DEF	XBRL Taxonomy Extension Definition Linkbase Definition	X

 

(b) The following documents are filed as part of the report:

 

1. Financial Statements: Balance Sheet, Statement of Operations, Statement of Stockholder’s Equity, Statement of Cash Flows, and Notes to Financial Statements.

 

We are an inactive entity as defined by Section 3-11 of Regulation S-X. Accordingly, the financial statements required for purposes of reports pursuant to the Securities Exchange Act of 1934 are unaudited. 

 

SIGNATURES

In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

ANDES 7 INC.

 

Dated: May 4, 2017

	By:	/s/ Andrew Khor Poh Kiang
		Andrew Khor Poh Kiang President, Chief Executive Officer, Chairman of the Board of Directors
	By:	/s/ Lee Kok Keing
		Lee Kok Keing Chief Financial Officer

 

 

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

Name		Title		Date
By: /s/ Andrew Khor Poh Kiang		Chief Executive Officer (Principal Executive Officer) and Chairman of the Board of Directors		May 4, 2017

 

 

 

 

 

 FINANCIAL INFORMATION

Contents

 

Report of Independent Registered Public Accounting Firm	F-1
Balance Sheets as of December 31, 2016 and 2015	F-2
Statements of Operations for years ended December 31, 2016 and 2015	F-3
Statements of Cash Flows for years ended December 31, 2016 and 2015	F-4
Notes to Financial Statements	F-5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

To the Board of Directors of Andes 7, Inc.

We have audited the accompanying balance sheets of Andes 7, Inc. as of December 31, 2016 & 2015 and the related statements of operations, shareholders’equity and cash flows for the two years then ended. Andes 7 Inc.’s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audit.We were not engaged to examine management’s assertion about the effectiveness ofAndes 7, Inc.’s internal control over financial reporting as of December 31, 2016.

 

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform 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 company’s 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 audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Andes 7, Inc.as of December 31, 2016 and 2015,and the results of its operations and its cash flows for the years then endedin conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company’s ability to raise additional capital through debt and/or equity financing to fund its operating costs is unknown, which raises substantial doubt about its ability to continue as a going concern. Management’s plan in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

De Leon & Company, P.A. Pembroke Pines, Florida
April 14, 2017

 

 

  

 

 

 

 

ANDES 7 Inc. 
Balance Sheets  

			December 31, 2016					December 31,  2015
ASSETS
Current Assets:
Cash			$	—				$	—
Total Current Assets			—					—
TOTAL ASSETS			$	—				$	—
LIABILITIES & STOCKHOLDERS’ DEFICIT
Current Liabilities:
Due to a related party			$	990				$	—
Accounts payable				—					1,619
Total Current Liabilities				990					1,619
TOTAL LIABILITIES				990					1,619
Shareholders' Deficit:
Preferred stock, $0.0001 par value, 5,000,000 shares authorized; none issued and outstanding									—
Common stock $0.0001 par value, 1,000,000,000 shares authorized; 10,100,000 and 10,000,000 shares issued and outstanding, respectively				1,010					1,000
Stock subscription receivable				(1,000)					—
Additional paid-in capital				23,050					1,250
Accumulated deficit				(24,050)					(3,869)
Total Stockholders’ Deficit				(990)					(1,619)
TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT			$	—				$	—

 

 The accompanying notes are an integral part of these financial statements.

 

 

 

ANDES 7 Inc.

Statement of Operations

 

		For the Year Ended December 31,2016		From July 27, 2015 (inception) through December 31, 2015
Revenue	$	-	$	-
Operating Expenses:
General and administrative		20,181		3,869
Total operating expenses		20,181		3,869
Net loss from operations	$	(20,181)	$	(3,869)
Loss before income taxes		(20,181)		(3,869)
Provision for income taxes		-		-
Net Loss	$	(20,181)	$	(3,869)
Basic loss per share	$	(0.00)	$	(0.00)
Weighted average number of common shares outstanding		10,088,493		10,100,000

The accompanying notes are an integral part of these financial statements.

 

 

 

 

 

 

 

 

ANDES 7 Inc.  Statement of Stockholders’ Deficit December 31, 2016
	Common Stock						Additional Paid-In				Stock Subscription		Accumulated Deficit			Total
	Shares			Amount			Capital				Receivable
Balance at July 27, 2015 (inception)		-		$	-		$	-		$	-	$	-		$	-
Issuance of common stock for compensation, related party		10,000,000			1,000			-			-		-			1,000
Contributed capital		-			-			1,250			-		-			1,250
Net loss for the year ended December 31, 2015		-			-			-			-		(3,869)			(3,869)
Balance at December 31, 2015		10,000,000			1,000			1,250			-		(3,869)		$	(1,619)
Contributed capital		-			-			21,800			-		-			21,800
Common stock returned		(9,900,000)			(990)			-			-		-			(990)
Issuance of common stock for cash		10,000,000			1,000			-			(1,000)		-			-
Net loss for the year ended December 31, 2016		-			-			-			-		(20,181)			(20,181)
Balance at December 31, 2016		10,100,000		$	1,010		$	23,050		$	(1,000)	$	(24,050)		$	(990)

 

 

 

 

 

ANDES 7 Inc.  Statement of Cash Flows
		For the Year Ended December 31,2016				From July 27, 2015 (inception) through December 31, 2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss		$	(20,181)		$	(3,869)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation - related party			—			1,000
Changes in operating assets and liabilities:
Accounts payable			(1,619)			1,619
Net cash used in operating activities			(21,800)			(1,250)
CASH FLOWS FROM INVESTING ACTIVITIES:			—			—
CASH FLOWS FROM FINANCING ACTIVITIES:
Contributed capital, related party			21,800			1,250
Net cash provided by financing activities			21,800			1,250
Net increase (decrease) in cash			—			—
Cash at beginning of year			—			—
Cash at end of year		$	—		$	—
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for interest		$	—		$	—
Cash paid for taxes		$	—		$	—
NON-CASH FINANCING ACTIVITY:
Common stock issued to founder for services rendered		$			$	1,000
Accounts payable credited to paid in capital		$	1,619		$	—
Related party payable for stock redemption		$	990		$	—

 

 

The accompanying notes are an integral part of these financial statements.

 

 

 

ANDES 7 Inc.

Notes to Financial Statements

December 31, 2016

 

 

NOTE 1 - DESCRIPTION OF BUSINESS AND HISTORY

 

Description of business

ANDES 7 Inc., (the “Company”) was incorporated under the laws of the State of Delaware on July 27, 2015, and has been inactive since inception. The Company intends to serve as a vehicle to effect an asset acquisition, merger, exchange of capital stock or other business combination with a domestic or foreign business.

 

On February 12, 2016, the Company entered into a Subscription Agreements with three subscribers for the issuance of its restricted common stock – Abina Asean, Co. Ltd., an entity organized under the laws of the Republic of Seychelles (8,000,000 shares), Toh Kean Ban (1,000,000 shares) and Dr. Ir. H.M. Itoc Tochija (1,000,000 shares). Each of the Subscription Agreements were the result of privately negotiated transactions without the use of public dissemination of promotional or sales materials. Each of the buyers represented they were “accredited investors,” and as such could bear the risk of such investment for an indefinite period of time and to afford a complete loss thereof.

 

In addition, on February 12, 2016, Tech Associates, Inc. (“Tech”) was engaged to provide advisory and consulting services. Tech’s compensation is not based on the facilitation of or sale of securities; rather, Tech has been engaged to provide consulting services in the context of a “going public” strategy. Tech’s sole shareholder is Richard Chiang, who is a former control person of the Company by virtue of his prior controlling interest in the Company. In consideration of mutual releases between Richard Chiang and the Company, Mr. Chiang consented to the Company’s redemption of 9,900,000 shares at par value, i.e. $990, which had previously been issued to him in serving in director and officer capacities. The Company has no disputes or disagreements with Mr. Chiang. In order to effectuate the redemption, Mr. Chiang agreed to return the stock certificate representing the 10,000,000 shares previously issued in consideration of the issuance of a new stock certificate representing 100,000 shares of restricted common stock. Following the Consent, the Board of Directors accepted Mr. Chiang’s resignation from the Board of Directors as being in the best interests of the Company, and proceeded to appoint Mr. Andrew Khor Poh Kiang as Chairman of the Board pursuant to the Consent. In addition, Mr. Chiang resigned as the Company’s Chief Executive Officer, President, Secretary and Treasurer.

 

On the same date as above, Andrew Khor Poh Kiang was named Chief Executive Officer and President, Lee Kok Keing was named Chief Financial Officer, Dr. Eric Chin Tek Mun was named Chief Operations Officer, Simon Chua Chooi Huat, was named Secretary, and Dr. Ng Mooi Eng was named Treasurer.

 

On January 31, 2017, the Company received a letter of resignation from Simon Chua Chooi Huat, its Secretary. There were no disagreements between the Company and Mr. Huat that led to his resignation, and on April 14, 2017, the Company elected Jannie Gui Honey as its Secretary.

 

NOTE 2 - SUMMARY OF SIGNIFICANT POLICIES

 

Basis of presentation

The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

 

Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires the Company to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. These estimates and judgments are based on historical information, information that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual results could differ from those estimates.

 

Earnings (loss) per share

Basic earnings (loss) per common share is computed by dividing net income (loss) available to common shareholders by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per common share is computed by dividing income available to common shareholders by the weighted-average number of shares of common stock outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if potentially dilutive securities had been issued. There were no potentially dilutive securities outstanding during the periods presented.

 

Stock-based compensation

The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with Financial Accounting Standards Board(“FASB”) ASC 718-10, Compensation – Stock Compensation, and the conclusions reached by FASB ASC 505-50, Equity – Equity-Based Payments to Non-Employees. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by FASB ASC 505-50.

 

Income taxes

The Company follows Section 740-10-30 of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Income and Income in the period that includes the enactment date.

 

The Company adopted section 740-10-25 of the FASB Accounting Standards Codification (“Section 740-10-25”) with regards to uncertainty income taxes.  Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements.  Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position.  The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures.  The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of Section 740-10-25.

 

 

Recent Accounting Pronouncements 

The Company has evaluated recent pronouncements through Accounting Standards Updates (“ASU”) 2015-08 and believes that none of them will have a material impact on the Company’s financial position, results of operations or cash flows.

 

      NOTE 3 - GOING CONCERN

 

The accompanying audited financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred losses since inception and had a deficit accumulated of $24,050 as of December 31, 2016. The Company requires capital for its contemplated operational and marketing activities. The Company’s ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company’s contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

 

NOTE 4 - STOCKHOLDERS’ EQUITY

 

Preferred Stock – The Company is authorized to issue 5,000,000 shares of $0.0001 par value preferred stock. As December 31, 2016 no shares of preferred stock had been issued.

 

Common Stock - The Company is authorized to issue 1,000,000,000 shares of $0.0001 par value common stock. As of December 31, 2016, 10,100,000 shares were issued and outstanding respectively.

 

Upon formation of the Company on July 27, 2015, the Board of Directors issued 10,000,000 shares of common stock for $1,000 in services to the founding shareholder of the Company.

 

On February 12, 2016, the Company entered into Subscription Agreements with three subscribers for the issuance of 10,000,000 shares of restricted common stock at par value of $0.0001 for total proceeds of $1,000. As of December 31, 2016 the proceeds have not yet been collected and have been debited to stock subscription receivable.

 

NOTE 5 - RELATED PARTY TRANSACTIONS

 

As December 31, 2016, the Company owed Richard Chiang $990 for the redemption of 9,900,000 shares at par value, which had previously been issued to him in serving in director and officer capacities (refer to Note 1).

 

For the years ended December 31, 2016 and 2015, the founder shareholder has contributed capital to the Company for services rendered of $9,248 and $1,250, respectively.

 

For the years ended December 31, 2016 and 2015, the CEO has contributed capital to the Company in the form of cash used for operating expenses of $12,552 and $0, respectively.

 

NOTE 6 – INCOME TAX

 

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases.  Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.  Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

 

 

Net deferred tax assets consist of the following components as of December 31:

 

		2016				2015
Deferred tax assets:
NOL carryover		$	(8,177)			$	(1,315)
Deferred tax liabilities:
None
Valuation allowance			8,177				1,315
Net deferred tax asset		$	-			$	-

 

 

The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income from continuing operations for the years ended December 31, 2016 and 2015 due to the following:

 

		2016				2015
Book income (loss)		$	6,862			$	(1,315)
Valuation allowance			(6,862)				1,315
		$	-			$	-

At December 31, 2016, the Company had net operating loss carry forwards of approximately $24,000 that may be offset against future taxable income from the year 2017 to 2036. No tax benefit has been reported in the December 31, 2016 financial statements since the potential tax benefit is offset by a valuation allowance of the same amount.

 

Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards 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 7 - SUBSEQUENT EVENTS

 

Management has evaluated subsequent events pursuant to the requirements of ASC Topic 855-10, Subsequent Events, through the date the financial statements were issued and determined that no subsequent events occurred that would require adjustment to or disclosure in the financial statements.