Attached files
| file | filename |
|---|---|
| EX-32 - EX-32 - iHealthcare, Inc. | ex32.htm |
| EX-31 - EX-31 - iHealthcare, Inc. | ex31.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
| [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934. |
FOR THE QUARTERLY PERIOD ENDED May 31, 2017
OR
| [ ] 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: 000-55378
iHealthcare, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 47-3002847 | |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | |
| 3901 NW 28th Street, 2nd Floor, Miami, FL | 33142 | |
| (Address of principal executive offices) | (Zip Code) | |
N/A
(Former name if changed since last report)
Indicate by check mark whether the registrant (1) 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 (Section 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). [X]Yes [ ] No
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.
| Large accelerated filer ☐ | Accelerated filer ☐ | Non-accelerated filer ☐ (Do not check if a smaller reporting company) | ||
| Smaller reporting company ☒ | Emerging growth company ☒ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
[ ] Yes [X] No
State the number of shares outstanding of each of the issuer’s classes of common equity, as of July 17, 2017: 1,085,100 shares of common stock.
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TABLE OF CONTENTS
IHEALTHCARE, INC.
INDEX
PART I-FINANCIAL INFORMATION
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PART I-FINANCIAL INFORMATION
| ITEM 1 | FINANCIAL STATEMENTS |
IHEALTHCARE, INC.
(UNAUDITED)
|
As of May 31, 2017 |
As of November 30, 2016 | ||||
| ASSETS | |||||
| Current Assets | |||||
| Cash | $ | 1,315 | $ | 33 | |
| Inventory | 285 | 285 | |||
| Loan to Related Party | 4,491 | - | |||
| TOTAL ASSETS | $ | 6,091 | $ | 318 | |
| LIABILITIES & STOCKHOLDERS’ DEFICIT | |||||
| Current Liabilities | |||||
| Accrued expenses | $ | 2,150 | $ | 4,629 | |
| Due to related party | 22,908 | 13,855 | |||
| Total Current Liabilities | 25,058 | 18,484 | |||
| TOTAL LIABILITIES | 25,058 | 18,484 | |||
| Stockholders’ Deficit | |||||
| Series A Preferred stock ($.0001 par value, 1,500,000 shares authorized; none issued and outstanding) | - | - | |||
| Series B Preferred stock ($.0001 par value, 5,000,000 shares authorized; none issued and outstanding) | - | - | |||
| Common stock ($.0001 par value 143,500,000 shares authorized and 1,085,100 and 1,000,000 outstanding as of May 31, 2017 and November 30, 2016, respectively) | 109 | 100 | |||
| Subscription receivable | (5,500) | (5,500) | |||
| Additional paid in capital | 64,864 | 43,598 | |||
| Accumulated deficit | (78,440) | (56,364) | |||
| Total Stockholders’ Deficit | (18,967) | (18,166) | |||
| TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT | $ | 6,091 | $ | 318 | |
See Accompanying Notes to Interim Unaudited Consolidated Financial Statements.
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iHealthcare, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended May 31, 2017 |
Three Months Ended May 31, 2016 |
Six Months Ended May 31, 2017 |
Six Months Ended May 31, 2016 | ||||||||
| Revenues | $ | 841 | $ | - | $ | 1,386 | $ | - | |||
| Cost of goods sold | 285 | - | 570 | - | |||||||
| Gross Profit | $ | 556 | $ | - | $ | 816 | $ | - | |||
| Operating Expenses | |||||||||||
| Organization and related expenses | $ | 698 | $ | 1,964 | $ | 1,551 | $ | 2,215 | |||
| Professional fees | 4,641 | 19,361 | 21,341 | 27,111 | |||||||
| Total operating expenses | 5,339 | 21,325 | 22,892 | 29,326 | |||||||
| Net loss | $ | (4,783) | $ | (21,325) | $ | (22,076) | $ | (29,326) | |||
| Basic and diluted net loss per common share | $ | (0.00) | $ | (0.02) | $ | (0.02) | $ | (0.03) | |||
| Weighted average number of common shares outstanding - basic and diluted | 1,081,056 |
1,000,000 | 1,050,916 | 1,000,000 |
See Accompanying Notes to Interim Unaudited Consolidated Financial Statements.
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iHealthcare, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
|
For the Six Months Ended May 31, 2017 |
For the Six Months Ended May 31, 2016 | ||||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||||
| Net loss | $ | (22,076) | $ | (29,326) | |
| Adjustment to reconcile net loss to net cash used in operating activities: | |||||
| Changes in current assets and liabilities: | |||||
| Increase in accrued expenses | 3,931 | 13,630 | |||
| Net cash used in operating activities | $ | (18,145) | $ | (15,696) | |
| CASH FLOW FROM INVESTING ACTIVITIES: | |||||
| Overpayment accounted for as loan to related party | $ | (4,491) | $ | - | |
| Net cash used in investing activities | $ | (4,491) | $ | - | |
| CASH FLOWS FROM FINANCING ACTIVITIES | |||||
| Proceeds from related party loans | 8,094 | - | |||
| Payments made on related party loans | (5,451) | - | |||
| Subscription Receivable | - | 16,605 | |||
| Proceeds from the sale of common shares | 21,275 | - | |||
| Net cash provided by Financing Activities | $ | 23,918 | $ | 16,605 | |
| Increase in cash | 1,282 | 909 | |||
| Beginning cash balance | 33 | - | |||
| Ending cash balance | $ | 1,315 | $ | 909 | |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | |||||
| Interest paid | $ | - | $ | - | |
| Income taxes paid | $ | - | $ | - | |
| SUPPLEMENTAL DISCLOSURES OF NON-CASH INFORMATION: | |||||
| Expenses paid by related party on behalf of the Company | $ | 6,410 | $ | - | |
| Subscription receivable contributed in merger | $ | - | $ | 34,980 | |
| Due to related party | $ | - | $ | 11,536 |
See Accompanying Notes to Interim Unaudited Consolidated Financial Statements.
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iHealthcare, Inc.
NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
May 31, 2017
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
iHealthcare Inc. (formerly Opulent Acquisition, Inc.) (the Company) was incorporated under the laws of the State of Delaware on November 25, 2014. The Company intended to serve as a vehicle to affect an asset acquisition, merger, exchange of capital stock or other business combination with a domestic or foreign business. The Company elected November 30th as its year end.
On February 23, 2017 iHealthcare, Inc. entered into an agreement with John Cook and Paul Pereira. Under the terms of the agreement John Cook and Paul Pereira will act as part time consultants for iHealthcare, Inc. Their role shall pertain to assisting the Company with obtaining and structuring institutional financing from various commercial banks, investment banking firms, private equity firms and related financial and business issues. John Cook and Paul Pereira shall be compensated for their part time assistance as consultants through a combination of cash and stock incentives. John Cook and Paul Pereira shall be awarded a total of 10.00%, respectively, of Series B Preferred stock based upon acquisition milestones. The 10.00% to that point shall be Series B Preferred Stock, however, if they assist the Company in achieving gross revenues exceeding $200,000,000 then they will each be awarded an extra 2.5% of the Preferred Stock in a new class with the same rights as Series B. This would bring their total equity interest to 12.50% each, and 25.00% total. No milestones have been achieved and no shares of preferred stock issued as of May 31, 2017.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principals of Consolidation
These financial statements include the accounts of the Company’s wholly owned subsidiary iHealthcare, all material intercompany balances and transactions have been eliminated.
Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, these financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included and such adjustments are of a normal recurring nature. These unaudited consolidated financial statements should be read in conjunction with the financial statements for the year ended November 30, 2016 and notes thereto.
The results of operations for the three and six month period ended May 31, 2017 are not necessarily indicative of the results for the full fiscal year.
Inventories
Inventories, consisting of products available for sale, are primarily accounted for using the first-in, first-out ("FIFO") method, and are valued at the lower of cost or market value. This valuation requires iHealthcare, Inc. to make judgments, based on currently-available information, about the likely method of disposition, such as through sales to individual customers, returns to product vendors, or liquidations, and expected recoverable values of each disposition category.
Revenue Recognition
The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured.
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NOTE 3 - GOING CONCERN
The Company’s unaudited interim consolidated financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business.
The Company demonstrates adverse conditions that raise substantial doubt about the Company's ability to continue as a going concern for one year following the issuance of these financial statements. These adverse conditions are negative financial trends, specifically operating loss, working capital deficiency, negative cash flow from operating activities, and other adverse key financial ratios.
The Company has not established any significant source of revenue to cover its operating costs. Management plans to fund operating expenses with related party contributions to capital. There is no assurance that management's plan will be successful.
The unaudited interim consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event that the Company cannot continue as a going concern.
NOTE 4 - RELATED-PARTY TRANSACTIONS
Due to related party
Unisource Discovery, Inc., is a related party and is controlled by our Chief Executive Officer, Noel Mijares. During the year ending November 30, 2016 Unisource Discovery Inc. advanced the Company $6,115 and the Company made payment of $3,805 on these advances. The total due to the Unisource Discovery Inc. as November 30, 2016 was $2,310. During the period ending May 31, 2017, Unisource Discovery Inc. advanced the Company $3,041 and the Company made payments of $5,351 on these advances to pay the balance owed in full. In addition, monies were transferred from the Company to Unisource Discovery Inc. totaling $4,491 for the six month period. This is listed as a loan to related party in the balance sheet. The loan is unsecured, noninterest-bearing and is payable on demand.
During the year ending November 30, 2016, the Company borrowed $19,545 from its CEO to pay for expenses on behalf of the company in the current year and $7,500 of these payments were posted as a reduction to subscription receivable. As of November 30, 2016, the Company was indebted to the Chief Executive Officer of the Company in the amount of $11,545. During the six months ended May 31, 2017, our CEO advanced $5,053 and paid $6,410 in expenses on behalf of the Company totaling $11,463 and was paid back $100 for a total loan balance of $22,908 as of May 31, 2017. This loan is unsecured, noninterest-bearing and is payable on demand.
Subscription Receivable
As a result of the merger in 2016, a subscription receivable was contributed by the principal shareholders in the amount of $34,980. The Company has collected $21,980 from the subscription receivable and converted advances of $7,500 due to the Company’s CEO as of November 30, 2016. The balance as of November 30, 2016 and May 31, 2017 is $5,500 which is owed by the Company’s CFO.
Office Space
Our office space is located at 3901 NW 28th Street, 2nd Floor, Miami, FL 33142 . This space is provided to the Company rent free by Noel Mijares, who leases the office space on his personal behalf.
NOTE 5 - EQUITY
During the six months ended May 31, 2017, 85,100 shares of common stock were sold to 30 purchasers at a share price of $0.25 per share. The proceeds from the sale of stock totaled $21,275 which is recorded as $21,266 in additional paid-in capital and $9 in common stock.
NOTE 6 – SUBSEQUENT EVENTS
On July 11, 2017, a related party repaid $2,000 of loan due to the Company.
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| ITEM 2 | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
FORWARD LOOKING STATEMENTS
This Quarterly Report of iHealthcare, Inc. on Form 10-Q contains forward-looking statements, particularly those identified with the words, “anticipates,” “believes,” “expects,” “plans,” “intends,” “objectives,” and similar expressions. These statements reflect management's best judgment based on factors known at the time of such statements. The reader may find discussions containing such forward-looking statements in the material set forth under “Management's Discussion and Analysis of Financial Condition and Results of Operations,” generally, and specifically therein under the captions “Liquidity and Capital Resources” as well as elsewhere in this Quarterly Report on Form 10-Q. Actual events or results may differ materially from those discussed herein. The forward-looking statements specified in the following information have been compiled by our management on the basis of assumptions made by management and considered by management to be reasonable. Our future operating results, however, are impossible to predict and no representation, guarantee, or warranty is to be inferred from those forward-looking statements.
The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry, and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements. No assurance can be given that any of the assumptions relating to the forward-looking statements specified in the following information are accurate, and we assume no obligation to update any such forward-looking statements.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
We prepare our financial statements in conformity with GAAP, which requires management to make certain estimates and apply judgments. We base our estimates and judgments on historical experience, current trends and other factors that management believes to be important at the time the financial statements are prepared. Due to the need to make estimates about the effect of matters that are inherently uncertain, materially different amounts could be reported under different conditions or using different assumptions. On a regular basis, we review our critical accounting policies and how they are applied in the preparation of our financial statements.
While we believe that the historical experience, current trends and other factors considered support the preparation of our financial statements in conformity with GAAP, actual results could differ from our estimates and such differences could be material.
PLAN OF OPERATION
At present our primary business activities consist of, and revolve around, the sale of the UDT Cup which is a urinalysis device used for drug screening. Our sales of the UDT Cup have resulted in our current sole revenue stream. We will continue to pursue the sale of the UDT Cup as our primary business objective. In addition to our principal business activities we, and our subsidiary iHealthcare Surgical LLC, have entered into various business agreements with third party entities as disclosed in our business plan on Form 10-K filed March 14, 2017. Although we have yet to achieve any revenue from these activities we are attempting to diversify our revenue streams by acting as a sales agent for entities in the healthcare industry, and to pursue potential joint ventures.
RESULTS OF OPERATIONS
For the three months ended May 31, 2017 and May 31, 2016:
We had revenues in the three month period ending May 31, 2017 of $841 and $0 for the three month period ending May 31, 2016. All of our revenues to date have been a result of sales of the UDT Cup. Our operating expenses totaled $5,339 for the three months ended May 31, 2017 and $21,325 for the three months ended May 31, 2016. Our operating expenses consisted primarily of professional fees for both periods. The variance in operating expenses is due to the fact that we incurred greater consulting fees for the three months ended May 31, 2016. These fees were primarily a result of consulting fees relating to our S-1 Registration Statement that we had filed in May of 2016. Our net loss for the three months ended May 31, 2017 was $4,783 and was $21,325 for the three months ended May 31, 2016.
For the six months ended May 31, 2017 and May 31, 2016:
We had revenues in the six month period ending May 31, 2017 of $1,386 and $0 for the six month period ending May 31, 2016. All of our revenues to date have been a result of sales of the UDT Cup. Our operating expenses totaled $22,892 for the six months ended May 31, 2017 and $29,326 for the six months ended May 31, 2016. Our operating expenses consisted primarily of professional fees for both periods. The variance in operating expenses is due to the fact that we incurred greater consulting fees for the six months ended May 31, 2016. These fees were primarily a result of consulting fees relating to our S-1 Registration Statement that we had filed in May of 2016. Our net loss for the six months ended May 31, 2017 was $22,076 and was $29,326 for the six months ended May 31, 2016.
LIQUIDITY AND CAPITAL RESOURCES
We have no internal sources of liquidity at this time.
Our only external sources of liquidity at this time are from funds contributed by our officers/directors and from funds raised from the sale of our common stock.
During the six months ended May 31, 2017, 85,100 shares of common stock were sold to 30 purchasers at a share price of $0.25 per share. The proceeds from the sale of stock totaled $21,275 which is recorded as $21,266 in additional paid-in capital and $9 in common stock.
There is no assurance our officers and directors will be willing to or able to fund our operations for any duration of time. There is also no assurance we will be able to secure additional sources of funding. Our ability to to continue to operate is a going concern.
We have no known demands or commitments and are not aware of any events or uncertainties as of May 31, 2017 that will result in or that are reasonably likely to materially increase or decrease our current liquidity.
We had no material commitments for capital expenditures as of May 31, 2017 and November 30, 2016.
As of May 31, 2017, we had current assets of $6,091 consisting of a combination of cash, inventory, and loans to a related party. As of May 31, 2017 we had current liabilities of $25,058.
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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.
| ITEM 3 | 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 the information required by this Item.
ITEM 4 |
|
Evaluation of Disclosure Controls and Procedures
The Company’s Chief Executive Officer and Chief Financial Officer, after evaluating the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Securities Exchange Act Rules 13a-15 (f) and 15d-15(f)) as of May 31, 2017 , have concluded that as of such date the Company’s disclosure controls and procedures were inadequate and ineffective in their design to provide reasonable assurance that material information relating to the Company would be made known to such officer on a timely basis.
For a full discussion of our internal control over financial reporting, please refer to Item 9A, “Controls and Procedures”, in our 2016 Annual Report on Form 10-K.
Changes in Internal Controls over Financial Reporting
There have been no changes in the Company’s internal controls over financial reporting identified in connection with the evaluation required by paragraph (d) of Securities Exchange Act Rule 13a-15 or Rule 15d-15 that occurred in the three months ended May 31, 2017 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II-OTHER INFORMATION
| ITEM 1 | LEGAL PROCEEDINGS |
There are no legal proceedings against the Company and the Company is unaware of such proceedings contemplated against it.
| ITEM 1A | RISK FACTORS |
As a “smaller reporting company” defined by Item 10 of Regulation S-K, the Company is not required to provide the information required by this Item.
| ITEM 2 | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
None.
| ITEM 3 | DEFAULTS UPON SENIOR SECURITIES |
None.
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| ITEM 4 | MINE SAFETY DISCLOSURES |
Not applicable.
| ITEM 5 | OTHER INFORMATION |
None.
| ITEM 6 | EXHIBITS |
| (a) | Exhibits required by Item 601 of Regulation S-K. |
| Exhibit No. | Description | |
| 3.1 | Restated Certificate of Incorporation. (1) | |
| 3.2 | By-laws. (1) | |
| 10.1 | Merger Agreement. (1) | |
| 10.2 | Distribution Agreement with ILS (1) | |
| 31 | Certification of the Company’s Chief Executive and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s report on Form 10-Q for the quarter ended May 31, 2017. (2) | |
| 32 | Certification of the Company’s Chief Executive and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (2) | |
| 101.INS | XBRL Instance Document (3) | |
| 101.SCH | XBRL Taxonomy Extension Schema (3) | |
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase (3) | |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase (3) | |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase (3) | |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase (3) | |
____________________
| (1) | Filed as an exhibit to the Company's Form 8-K/A filed on September 8, 2016. |
| (2) | Filed herewith. |
| (3) | Users of this data are advised that, pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Exchange Act of 1934 and otherwise are not subject to liability. |
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, there unto duly authorized.
iHealthcare, Inc.
(Registrant)
By: /s/ Noel Mijares
Chief Executive Officer
Dated: July 17, 2017
By: /s/ David A. Bingaman
David A. Bingaman, Chief Financial Officer
Dated: July 17, 2017
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