UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 10-Q

 

 

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

 

For the quarterly period ended May 31, 2017

 

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

 

For the transition period from:

 

Commission file number: 000-54567

 

VINCOMPASS CORP.

(Exact name of small business issuer in its charter)

 

Wyoming		80-0552115
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
795 Folsom Street, 1st Floor, San Francisco, CA		94107
(Address of principal executive offices)		(Zip Code)

 

Issuer’s telephone number: (415) 817-9955

 

Securities Registered Under Section 12(b) of the Exchange Act: None

 

Securities Registered Under Section 12(g) of the Exchange Act:

Common Stock, $0.001 par value

(Title of class)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

[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). [X] Yes [  ] No (Not required)

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer [  ] Non-accelerated filer [  ] Emerging growth company [  ]

Accelerated filer [  ] Smaller reporting company [X]

 

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

 

As of July 21, 2017, there were 261,802,775 common shares of the registrant’s $0.001 par value common stock issued and outstanding.

 

 

 

VINCOMPASS CORP.

TABLE OF CONTENTS

 

		Page
PART I.	FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS (UNAUDITED)	F-1
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	3
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	7
ITEM 4.	CONTROLS AND PROCEDURES	7
PART II.	OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	7
ITEM 1A.	RISK FACTORS	7
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	8
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	8
ITEM 5.	OTHER INFORMATION	8
ITEM 6.	EXHIBITS	8

 

Special Note Regarding Forward-Looking Statements

 

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of VinCompass Corp. (the “Company”), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

 

*Please note that throughout this Quarterly Report, and unless otherwise noted, the words “we,” “our,” “us,” the “Company,” “VCPS,” or “VinCompass” refers to VinCompass Corp.

 

 

PART I - FINANCIAL INFORMATION

 

ITEM 1.

FINANCIAL STATEMENTS

 

INDEX
Consolidated Balance Sheets as of May 31, 2017 and February 28, 2017 (Unaudited)	F-2
Consolidated Statements of Operations for the Three Months Ended May 31, 2017 and 2016 (Unaudited)	F-3
Consolidated Statements of Cash Flows for the Three Months Ended May 31, 2017 and 2016 (Unaudited)	F-4
Notes to the Consolidated Financial Statements (Unaudited)	F-5

 

 

VinCompass Corp.

Consolidated Balance Sheets

(Unaudited)

 

		31-May-17				28-Feb-17
ASSETS
Current Assets:
Cash		$	29,279			$	13,952
Total Current Assets			29,279				13,952
TOTAL ASSETS		$	29,279			$	13,952
LIABILITIES & STOCKHOLDER’S DEFICIT
Current Liabilities:
Accounts payable and accrued liabilities		$	178,789			$	195,302
Accrued payroll			206,000				216,000
Accounts Payable to related parties			325,781				289,281
Convertible notes payable, net of discount of $81,530 and $73,281, respectively			285,803				259,981
Derivative liability			202,966				112,461
Total Current Liabilities			1,199,339				1,073,025
Total Liabilities		$	1,199,339			$	1,073,025
Stockholders’ Deficit:
Series A Preferred Stock, $0.001 par value; 20,000,000 and 2,000,000 authorized; 5,000,000 and 1,000,000 shares issued and outstanding, respectively		$	5,000			$	1,000
Series B Preferred Stock, $0.50 par value; 20,000,000 and 0 authorized; 0 shares issued and outstanding, respectively		$	-			$	-
Common Stock, $0.001 par value; 4,960,000,000 and 400,000,000 shares authorized; 147,322,775 and 47,079,718 shares issued and outstanding, respectively			147,322				47,149
Additional Paid-in Capital			2,554,924				1,890,147
Accumulated Deficit			(3,877,306	)			(2,997,369	)
Total Stockholders’ Deficit			(1,170,060	)			(1,059,073	)
TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT		$	29,279			$	13,952

 

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

 

 

VinCompass Corp.

Consolidated Statements of Operations

(Unaudited)

 

		For the Three Months Ended May 31,
		2017				2016
Operating Expenses:
General and administrative			339,878				147,111
Total Operating Expenses			339,878				147,111
Loss from operations			(339,878	)			(147,111	)
Other Expenses:
Interest expense			(202,709	)			(7,949	)
Loss on derivative			(337,350	)			-
Total other expense			(540,059	)			(7,949	)
Net loss		$	(879,937	)		$	(155,060	)
Basic and diluted loss per share		$	(0.01	)		$	(0.00	)
Weighted average number of shares outstanding – basic and diluted			69,043,891				43,702,289

 

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

 

 

VinCompass Corp.

Consolidated Statement of Cash Flows

(Unaudited)

 

		For the Three Months Ended May 31,
		2017				2016
Cash flow from operating activities:
Net loss		$	(879,937	)		$	(155,060	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock based compensation			149,900				31,250
Amortization of debt discount			193,571				-
Loss on derivative liabilities			337,350				-
Changes in operating assets and liabilities:
Accounts payable to related party			36,500				21,170
Accrued payroll			30,000				30,000
Accounts payable and accrued expenses			(9,057	)			31,134
Net cash used in operating activities			(141,673	)			(41,506	)
Cash flows from financing activities:
Proceeds from convertible debt			157,000				-
Net cash provided by financing activities		$	157,000			$	-
Net decrease in cash			15,327				(41,506	)
Cash at beginning of period			13,952				43,680
Cash at end of period		$	29,279			$	2,174
Supplemental disclosure of noncash activities:
Settlement of deferred payroll by issuance of Preferred stock		$	40,000			$	-
Debt discount recognized from derivative liabilities		$	185,000			$	-
Release of derivative liabilities due to conversion of convertible debt		$	431,845			$	-
Common shares issued for conversion of convertible note		$	147,205			$	-

 

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

 

 

VINCOMPASS CORP.

Notes to the Consolidated Financial Statements

May 31, 2017

(Unaudited)

 

NOTE 1 — ORGANIZATION AND DESCRIPTION OF BUSINESS

 

VinCompass Corp. (Formerly known as Tiger Jiujiang Mining, Inc.), entered into a Share Exchange Agreement with VinCompass®, whereby VinCompass Corp. exchanged 60% of its outstanding shares of common stock for 100% of the outstanding shares of VinCompass® common stock. As of the closing date, VinCompass® will operate as a wholly owned subsidiary of VinCompass Corp.

 

On March 7, 2017, the Board approved and filed an Amended & Restated Articles of Incorporation with the Secretary of State of Wyoming whereby: the aggregate number of shares of all classes of capital stock which this Corporation shall have authority to issue is 1,000,000,000 shares, of which 20,000,000 shares shall be shares of Series A Preferred Stock shall have 100:1 voting rights, and a conversion right of 10:1 to common stock which may or may not be converted in the future, par value of $.001 per share and of which 20,000,000 shares shall be shares of Series B Preferred Stock shall have no voting rights (unless converted), and a conversion right into common shares of stock at a variable conversion rate (“Variable Conversion Price”). The Variable Conversion Price shall mean 50% multiplied by the Market Price (as defined herein)(representing a discount rate of 50%) which may or may not be converted in the future, par value of $0.50 per share as described herein (“Preferred Stock”), and 960,000,000 shares shall be shares of common stock, par value of $.001 per share (“Common Stock”).

 

On May 8, 2017, the Board approved and filed an Amended & Restated Articles of Incorporation with the Secretary of State of Wyoming to: (i) increase our authorized common stock to 5,000,000,000 shares, of which 20,000,000 shares shall be shares of Series A preferred Stock shall have 100:1 voting rights, and a conversion right of 10:1 to common stock which may or may not be converted in the future, par value of $.001 per share and of which 20,000,000 shares shall be shares of Series B Preferred Stock shall have no voting rights (unless converted), and a conversion right into common shares of stock at a variable conversion rate (“Variable Conversion Price”). The Variable Conversion Price shall mean 50% multiplied by the Market Price (as defined herein)(representing a discount rate of 50%) which may or may not be converted in the future, par value of $0.50 per share as described herein (“Preferred Stock”), and 4,960,000,000 shares shall be shares of common stock, par value of $.001 per share (“Common Stock ”).

 

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

The accompanying unaudited consolidated interim financial statements of VinCompass Corp have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s Form 10-K filed with SEC. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year ended February 28, 2018. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the year ended February 28, 2017 as reported on Form 10-K have been omitted.

 

NOTE 3 – GOING CONCERN

 

The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. The Company has had no revenue to dare, has an accumulated deficit of $3,877,306 as of May 31, 2017 and a net loss of $879,937 for the three months ended May 31, 2017. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

 

While the Company is attempting to increase operations and generate revenues, the Company’s cash position may not be significant enough to support the Company’s daily operations. The Company will continue to pursue additional equity and/or debt financing while managing cash flows from operations in an effort to provide funds to meet its obligations on a timely basis and to support future business development. There is no assurance that these efforts will be successful. Management believes that the actions presently being taken to further implement its business plan and generate additional revenues provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to generate additional revenues and in its ability to raise the additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plans and generate additional revenues.

 

The financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may result should the Company be unable to continue as a going concern.

 

 

NOTE 4 – EQUITY

 

On March 7, 2017, the Board approved and filed an Amended & Restated Articles of Incorporation with the Secretary of State of Wyoming whereby: the aggregate number of shares of all classes of capital stock which this Corporation shall have authority to issue is 1,000,000,000 shares, of which 20,000,000 shares shall be shares of Series A Preferred Stock shall have 100:1 voting rights, and a conversion right of 10:1 to common stock which may or may not be converted in the future, par value of $.001 per share and of which 20,000,000 shares shall be shares of Series B Preferred Stock shall have no voting rights (unless converted), and a conversion right into common shares of stock at a variable conversion rate (“Variable Conversion Price”). The Variable Conversion Price shall mean 50% multiplied by the Market Price (as defined herein)(representing a discount rate of 50%) which may or may not be converted in the future, par value of $0.50 per share as described herein (“Preferred Stock”), and 960,000,000 shares shall be shares of common stock, par value of $.001 per share (“Common Stock”).

 

On May 8, 2017, the Board approved and filed an Amended & Restated Articles of Incorporation with the Secretary of State of Wyoming to: (i) increase our authorized common stock to 5,000,000,000 shares, of which 20,000,000 shares shall be shares of Series A Preferred Stock shall have 100:1 voting rights, and a conversion right of 10:1 to common stock which may or may not be converted in the future, par value of $.001 per share and of which 20,000,000 shares shall be shares of Series B Preferred Stock shall have no voting rights (unless converted), and a conversion right into common shares of stock at a variable conversion rate (“Variable Conversion Price”). The Variable Conversion Price shall mean 50% multiplied by the Market Price (as defined herein)(representing a discount rate of 50%) which may or may not be converted in the future, par value of $0.50 per share as described herein (“Preferred Stock”), and 4,960,000,000 shares shall be shares of common stock, par value of $.001 per share (“Common Stock ”).

 

During the three months ended May 31, 2017, the Company issued 9,000,000 shares for services to third parties. The fair value of the shares is determined to be $9,900 using the market price upon issuance.

 

During the three months ended May 31, 2017, the Company issued 91,173,404 shares for converted debt principal of $139,749 and accrued interest of $7,456.

 

During the three months ended May 31, 2017, the Company issued 4,000,000 shares of preferred stock to settle $40,000 accrued payroll due to the CEO see note 5. The Series A Preferred Stock shall have 100:1 voting rights, and a conversion right of 10:1 to common stock which may or may not be converted in the future. The fair value of the shares is determined to be $180,000 using the weighted-average stock price during three months ended May 31, 2017 while the par value of $0.001 of the shares for $40,000. The surplus of $140,000 is recorded as stock based compensation expense.

 

NOTE 5 – RELATED PARTY TRANSACTIONS

 

As of May 31, 2017, the amounts due to the majority shareholder and a director bear no interest and with no stated repayment terms totaled $325,781 ($289,281 as at February 28, 2017) arose from payments made on behalf of the Company, including by private credit card.

 

As of May 31, 2017, the Company had an accrued payroll expense of $206,000 ($216,000 as at February 28, 2017), after converting $40,000 of the amount owed into 4,000,000 Preference Shares see Note 4. Of the total amount owed to Related Parties, the CEO is owed $511,781 for the period ending May 31, 2017 compared to $495,281 ending February 28, 2017.

 

		May 31, 2017				February 28, 2017
Accrued payroll		$	206,000			$	216,000
Accounts payable to related parties			325,781				289,281
		$	531,781			$	505,281

 

 

NOTE 6 – CONVERTIBLE NOTES PAYABLE

 

During the three months ended May 31, 2017, the Company executed four Convertible Promissory Notes totaling $173,850 for proceeds of $157,000. Three of the notes bear an interest rate of 10% and one at 8% per annum and are due between January 15, 2018 and March 28, 2018. During the three months ended May31, 2017, there are $193,571 debt discount amortized into interest expense for the convertible notes below.

 

The following table summarizes the convertible notes as of May 31, 2017:

 

Note #				Date		Maturity Date		Convertible Date		Interest				Balance of Loan				Debt Discount				Net Balance May 31, 2017
	1			8/15/2016		8/15/2017		2/15/2017			10	%		$	21,792			$	(5,789	)		$	16,003
	2			9/28/2016		9/28/2017		3/28/2017			10	%			47,392				(24,837	)			22,555
	3			10/28/2016		7/28/2017		4/26/2017			10	%			66,299				(34,433	)			31,866
	4			2/22/2017		11/30/2017		8/15/2017			10	%			58,000				(1,954	)			56,046
	5			3/15/2017		3/15/2018		9/11/2017			10	%			37,000				(4,262	)			32,738
	6			3/28/2017		3/28/2018		9/24/2017			8	%			45,850				(4,823	)			41,027
	7			4/10/2017		1/15/2018		10/7/2017			10	%			38,000				(2,556	)			35,444
	8			5/16/2017		2/25/2018		11/12/2017			10	%			53,000				(2,876	)			50,124
														$	367,333			$	(81,530	)		$	285,803

 

These notes become convertible six months after the dates of agreement at a variable conversion price.

 

The Company evaluates embedded conversion features within convertible debt under ASC 815 “Derivatives and Hedging” to determine whether the embedded conversion feature(s) should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20 “Debt with Conversion and Other Options” for consideration of any beneficial conversion features.

 

Convertible note holders have the option to convert the note plus accrued interest into shares of the Company’s common stock after six months, at a certain discount of the average of the lowest trading prices for the previous 20 days prior to the conversion date. The Company determined the embedded conversion feature as a derivative liability, and recorded at fair value as of May 31, 2017.

 

A summary of the activity of the derivative liability for the period ended May 31, 2017 is as follows:

 

Balance at February 28, 2017		$	112,461
Addition of derivative as a debt discount			185,000
Addition of derivative as day 1 loss			318,217
Decrease due to debt conversion			(431,845	)
Change in Fair Value			19,133
Balance at May 31, 2017		$	202,966

 

A summary of quantitative information about significant unobservable inputs (Level 3 inputs) used in measuring the Company’s derivative liabilities that are categorized within Level 3 of the fair value hierarchy for the quarter ended May 31, 2017 is as follows:

 

Date of valuation		May 31, 2017				Inception
Volatility (annual)			396% - 417%				247% - 255%
Risk-free rate			.92% - 1.38%				.61% - .67%
Years to maturity			.25 –.33				.5

 

The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments. The Company’s notes payable approximates the fair value of such instruments based upon management’s best estimate of interest rates that would be available to the Company for similar financial arrangements at May 31, 2017.

 

		Fair value measured at May 31, 2017
		Fair value at May 31, 2017				Quoted prices in active markets (Level 1)				Significant other observable inputs (Level 2)				Significant unobservable inputs (Level 3)
Derivative liabilities		$	202,966			$	-			$	-			$	202,966

 

NOTE 7 - SUBSEQUENT EVENTS 

 

Management has evaluated subsequent events pursuant to the requirements of ASC Topic 855, from the balance sheet date through the date the financial statements were issued, and has determined that no material subsequent events exist other than the following.

 

Since the period ending May 31, 2017 the Company executed a Promissory Notes totaling $11,000.00 on July 11, 2017. The note bears an interest rate of 10.0% per annum and is due January 11, 2018

 

The Company has also issued 114,480,000 shares from Convertible Note conversions since the period ended May 31, 2017.

 

 

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

Cautionary Statement Regarding Forward-Looking Statements

 

The following Management’s Discussion and Analysis should be read in conjunction with VinCompass Corp. financial statements and the related notes thereto. The Management’s Discussion and Analysis contains forward-looking statements that involve risks and uncertainties, such as statements of our plans, objectives, expectations and intentions. Any statements that are not statements of historical fact are forward-looking statements. When used, the words “believe,” “plan,” “intend,” “anticipate,” “target,” “estimate,” “expect,” and the like, and/or future-tense or conditional constructions (“will,” “may,” “could,” “should,” etc.), or similar expressions, identify certain of these forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements in this Report on Form 10-Q. The Company’s actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors. The Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this Report on Form 10-Q.

 

As used in this quarterly report, the terms “we”, “us”, “our”, and “Company” shall mean “VinCompass” where events are referenced.

 

Our financial statements are stated in United States Dollars (“USD” or “US$” or “$”) and are prepared in accordance with United States Generally Accepted Accounting Principles. All references to “common shares” refer to the common shares in our capital stock.

 

THE FOLLOWING ANALYSIS OF THE RESULTS OF OUR OPERATIONS AND FINANCIAL CONDITION FOR THE THREE-MONTH PERIOD ENDING MAY 31, 2017, SHOULD BE READ IN CONJUNCTION WITH THE CORPORATION’S FINANCIAL STATEMENTS, INCLUDING THE NOTES THERETO CONTAINED ELSEWHERE IN THIS FORM 10-Q AND IN OUR ANNUAL REPORT FILED ON FORM 10-K ON MAY 31, 2017.

 

The following discussion should be read in conjunction with our audited financial statements and the related notes that appear elsewhere in this Annual Report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to those discussed below and elsewhere in this Annual Report, particularly in the section entitled “Risk Factors”.

 

We are a development stage company and have not generated material revenue to date. We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.

 

As a result of Closing the Share Exchange Agreement as filed with the Commission on November 25, 2015 in the Company’s current report on Form 8-K, the registrant is no longer a shell corporation as that term is defined in Rule 405 of the Securities Act and Rule 12b-2 of the Exchange Act.

 

We were incorporated in the State of Wyoming on January 20, 2010, as Tiger Jiujiang Mining, Inc. and established a fiscal year end of February 28. Our statutory registered agent’s office is located at 1620 Central Avenue, Suite 202, Cheyenne, Wyoming 82001 and our business office is located at 795 Folsom Street, 1^st Floor, San Francisco, CA. Our telephone number is 415-817-9955.

 

On November 22, 2015, the Company, then under the name Tiger Jiujiang Mining, Inc., a Wyoming corporation (the “Company”) entered into a Share Exchange Agreement (the “Share Exchange Agreement”) with VinCompass Corp., a California corporation (“VinCompass”), the shareholders of VinCompass® (the “VinCompass Shareholders”), and the controlling stockholders of the Company (by unanimous vote) (the “Tiger Controlling Stockholders”). Pursuant to the Share Exchange Agreement, the Company acquired 5,200,000 (100%) shares of common stock of VinCompass® from the VinCompass® Shareholders (the “VinCompass Shares”) and in exchange issued 26,000,000 (59.77%) restricted shares of its common stock to the VinCompass® Shareholders (the “Tiger Shares”). As a result of the Share Exchange Agreement, VinCompass became a wholly-owned subsidiary of the Company upon closing and the Company now carries on the business of VinCompass® as its primary business. The Share Exchange Agreement contains customary representations, warranties and conditions to closing. The closing of the Share Exchange Agreement (the “Closing”) occurred on January 14, 2016 (the “Closing Date”).

 

 

As a result of the Share Exchange Agreement:

 

(a) each outstanding VinCompass® Share was cancelled, extinguished and converted into and became the right to receive a pro rata portion of the Tiger Shares which equaled the number of VinCompass Shares held by each VinCompass® Shareholder multiplied by the exchange ratio of 5(the “Exchange Ratio”). Based on the Exchange Ratio, as a result of the Share Exchange Agreement, the VinCompass Shareholders own a total of 26,000,000 restricted shares of common stock of the Company; and

 

(b) Pursuant to the Share Exchange Agreement, Ya-Ping irrevocably canceled a total of 25,000,000 restricted shares of common stock of the Company.

 

As a result of the Share Exchange Agreement, the VinCompass Shareholders own a total of 26,000,000 restricted shares of the Company, which represents 59.77% of our issued and outstanding shares of common stock. The Share Exchange Agreement is being accounted for as a “reverse acquisition,” as the VinCompass® Shareholders own a majority of the outstanding shares of the Company’s capital stock immediately following the Closing of the Share Exchange Agreement. Accordingly, VinCompass® is deemed to be the acquirer in the reverse acquisition. After the Closing of the Share Exchange Agreement, the Board of Directors and management of the Company are comprised of VinCompass’s management team and the operations of VinCompass® are the continuing operations of the Company.

 

BUSINESS

 

VinCompass® is an eCommerce platform built on patent pending technology that takes the guess work out of the wine buying equation for the consumer.  We have multiple revenue streams focused on providing curated wine through our wine club, direct purchases via our App and private label wines with the majority of the revenue realized as recurring wine subscriptions.  Our intelligent software platform determines an individual’s VinPrint® (wine DNA preference) so consumers can purchase wine that meets their profile with alluring value and availability. 

 

Our Proposed Exploration Program – Plan of Operation – Results of Operations

 

Wine buying is a daunting task and for the average consumer, there has been no means to easily select wines to enjoy and cellar that matches preferences for taste and price. To help fill this void, a plethora of wine clubs have popped up on the internet which have failed to address this problem. The clubs push wine that provide them with the greatest margin rather than address the needs of the consumer. As a result the membership renewals and reorder rates are well below those of other consumer product based clubs.

 

The solution is VinCompass®…. a full-service personalized wine curator and eCommerce platform. Our wine club will provide members only wines that meet their individual VinPrint® and at price levels determined by the consumer, providing enhanced membership renewals and reorder rates.

 

The Opportunity

 

Unlike the numerous .com wine sites and Apps that target retail wine enthusiasts looking to purchase wine, VinCompass® addresses the unmet need to uniquely pair taste and budget. With mobile devices now enabling 100’s of millions of consumers to instantly fulfill their interests in music, sports, news and reading, VinCompass® is poised to become the mobile app-enabled cloud service for consumers to discover, archive, socialize and acquire curated wines thus creating new opportunities to monetize the fast growing $1B$+/month e-wine marketplace.

 

For vineyards, it can be difficult and expensive to reach would-be customers. Unlike wine superstores who fail to connect boutique growers with the palate of discriminating drinkers, VinCompass® employs a unique, patent-pending “VinPrint”® to create a digital blue print of an individual’s’ wine preferences and then match those preferences with an inventory of more than 1 million wines and the wine lists of more than 10,000 restaurants. VinCompass® creates a personalized one-to-one relationship with life-long customers that growers otherwise would not otherwise be able to establish and cultivate to scale.

 

For wine lovers, the rise of such unprecedented access may result in too many choices; Restaurant lists can seem like a set of encyclopedias with too many different value options. Regardless of wine knowledge, choosing wine can be intimidating or time consuming. The VinCompass® mobile app quickly presents a list of nearby restaurants, whose wine lists they can peruse before even walking in the door. Before the sommelier hands over the wine list, VinCompass® will help select the ideal bottle based on wine tastes, budget and food preferences.

 

 

Our Brand and Products

 

App – VinCompass in the apple iTunes and Google Play

Web Site – eComm portal for Wine

 

Business Model

 

Both recurring and on-demand revenue in Wine eComm

 

●	Recurring revenue generated from wine club & freemium subscriptions (akin to Amazon’s Prime)
●	On-demand revenue generated from Virtual Vineyard, Private Label, Individually Branded, and Charity wines.
●	Engagement with an App beginning with discovery in the restaurant
●	Business Intelligence recurring revenue; Information and Insights for Restaurants and Wineries

 

Business Strategy

 

Invitation Only Model – We employ a complete Social graph network and full attribution for all members. Social as Members can invite other members to join and drive the social aspect.

 

Social Media Partnerships- We will service communities that have high affinity to wine consumers. These Partnerships get the advantage of providing significant benefit’s to their community that is not generally available. The members of VinCompass generally save about 16% on wine spend and yet enjoy wine more by 14% on average thanks to the Patent Pending Recommendation Engine. As well as ultimately enjoying a curated wine via eComm for consumption outside of the Restaurants.

 

Results of Operation for the Three Months Ended May 31, 2017 and 2016

 

The Company had net losses of $879,937 for the three months ended May 31, 2017 and a net loss of $155,060 for the equivalent quarter ended May 31, 2016. The costs can be subdivided into the following categories which have and will vary from quarter to quarter based on the level of corporate activity and capital-raising.

 

		For the three months ended May 31,
		2017				2016
Development		$	79,978			$	39,530
Sales and Marketing			46,518				31,243
Professional Fees			39,711				37,034
Other General & Administrative Expenses			173,671				39,304
Total Operating Expenses			339,878				147,111
Interest expense			202,709				7,949
Loss on derivative			337,350				-
Net Loss		$	879,937			$	155,060

 

Development expenses relate to product development, salaries and consulting fees, which have increased in the current quarter to $79,978 over last year’s comparative of $39,530 representing an increase of 102% .

 

Sales & Marketing relate to advertising, promotion, salaries & travel expenses was $46,518 for the three months ended May 31, 2017 compared to $31,243 for May 31, 2016 representing an increase of 48% .

 

Other General & Administrative expenses includes all other expenses including legal accounting, audit fees, office expenses, rent and car allowance was $173,671 for the three months ended May 31, 2017 compared to $39,304 for May 31, 2016. Adjusting for the surplus of $140,000 recorded as stock based compensation expense which may or may not be converted in the future (see Note 4) 33, 671 for the three months ended May 31, 2017 compared to $39,304 for May 31, 2016 representing an relative decrease of 15% .

 

Interest expense includes interest on convertible notes, amortization of debt discount and cost of finance amounting to $202,709 a substantial increased over last years comparative of $7,949. The Interest Expense of $202,709 was composed primarily of non cash Debt Discount Amortization of $193,571 for the convertible notes, resulting from raising finance through convertible notes, see Note 6.

 

 

Plan of Operation

 

As of May 31, 2017 and February 28, 2017, we had a deficit of $1,170,060 and $1,059,073 in working capital.

 

Over the balance of the current fiscal year we intend to seek financing for the ongoing development of the VinCompass business plan and to further develop our business model. We will need to raise sufficient additional capital for the work plus for our administrative operations and working capital through the sale of equity shares in the form of a private placement or public offering, loans or advances from officers or directors or others or convertible debentures.

 

We do not expect any changes or hiring of employees since contracts are given to consultants and sub-contractor specialists in specific fields of expertise. We do not expect to purchase or sell any plant or significant equipment. We intend to lease or rent any equipment that we will need in order to carry out our business plan development.

 

Presently, we have not generated any revenues to meet operating and capital expenses. We have incurred operating losses since inception, and this is likely to continue through fiscal 2017-2018. Management projects that we will require a total of up to $975,000 to fund ongoing operating expenses and working capital requirements. We continue to have term sheet negotiations with various third-party Family Offices, Financial Institutions and Private Individuals. The Company’s operating plan proposes a minimum capital injection of $1,000,000 for the year ending February 2018, and is also evaluating all equity and debt financing options; and/or a registration statement for up to $5,000,000. The additional new capital will be used for go to market, accelerate monetization such as the Digital Information and Insight business as well as increasing working capital.

 

Due to the uncertainty of our ability to meet our current operating and capital expenses, in their report on the annual financial statements for the year ended February 28, 2017, our independent auditors included an explanatory paragraph regarding concerns about our ability to continue as a going concern. Our financial statements contain additional note disclosures describing the circumstances that lead to this disclosure by our former independent auditors. Our issuance of additional equity securities could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

 

There are no assurances that we will be able to obtain further funds required for continued long term operations. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, we will not be able to meet our obligations as they become due.

 

Liquidity and Capital Resources

 

As of end of the last quarter on May 31, 2017, we have yet to generate any revenues from operations.

 

As of May 31, 2017, our total assets, consisting entirely of cash, amounted to $29,279 while total current liabilities were $1,199,339. Our working capital deficit was $1,170,060 as of May 31, 2017. The comparative figures as of the year ended February 28, 2017 were $13, 952, $1,073,025 and $1,059,073 respectively.

 

Net Cash Used in Operating Activities

 

During the three-month period ended May 31, 2017, $141,673 in cash was used for operating activities as compared to $41,506 used in the three- months ended May 31, 2016.

 

Cash Flow from Investing Activities

 

There was no investing activity for the three months ended May 31, 2017 and 2016.

 

Cash Flow from Financing Activities

 

During the thee-month periods ended May 31, 2017 and 2016, the Company had $157,000 and $0 respectively, in cash provided by financing activities.

  

Other

 

During the quarter ended May 31, 2017, the Company allocated 9,000,000 shares, to be issued in lieu of fees paid to third parties. The fair value of the shares is determined to be $9,900 using $0.001 per share, which represent the market price at the grant date. In addition third party convertible note holders converted $147,205 of notes into 91,173,404 shares, at various dates during the three month and at various prices, such issuances were approved by the board.

 

 

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

ITEM 4.

CONTROLS AND PROCEDURES

 

(a) Evaluation of Disclosure Controls and Procedures.

 

We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were ineffective to ensure that information required to be disclosed in reports filed under the Exchange Act is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

 

Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Accordingly, management believes that the financial statements included in this report fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented.

 

(b) Changes in Internal Controls over Financial Reporting.

 

Our management has also evaluated our internal control over financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of our last evaluation.

 

The Company is not required by current SEC rules to include, and does not include, an auditor’s attestation report. The Company’s registered public accounting firm has not attested to Management’s reports on the Company’s internal control over financial reporting.

 

PART II - OTHER INFORMATION

 

ITEM 1.

LEGAL PROCEEDINGS

 

From time to time, the Company may become subject to various legal proceedings that are incidental to the ordinary conduct of its business. Although the Company cannot accurately predict the amount of any liability that may ultimately arise with respect to any of these matters, it makes provision for potential liabilities when it deems them probable and reasonably estimable. These provisions are based on current information and legal advice and may be adjusted from time to time according to developments.

 

On July 12, 2017, the Company filed a lawsuit against Ya-Ping Chang for Breach of Contract, Fraud, and Civil Conspiracy to Defraud the Shareholders of VinCompass. On June 23, 2017, Ya-Ping Chang fraudulently obtained new EDGAR codes and falsely filed an 8-K, stating she was the majority shareholder of the Company claiming to be the new executive officer, and attempted to remove our Chairman, CEO and true majority shareholder, Peter Lachapelle, from all corporate offices. On July 14, 2017, the Company was heard on an emergency basis ex parte hearing in San Diego Superior Court and obtained a Restraining Order against Defendant Chang, restraining Defendant Chang from having any access to the Company. Defendant Chang’s counsel was present. The Company intends on pursuing any and all legal remedies available against Defendant Chang.

 

ITEM 1A.

RISK FACTORS

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

 

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

During the three months ended May 31, 2017:

 

During the quarter ended May 31, 2017, the Company allocated 9,000,000 shares, to be issued in lieu of fees paid to third parties. The fair value of the shares is determined to be $9,900 using $0.001 per share, which represent the market price at May 31, 2017. In addition third party convertible note holders converted $147,205 of notes into 91,173,404 shares, at various dates during the three month and at various prices, such issues were approved by the board.

 

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4.

MINE SAFETY DISCLOSURES

 

N/A.

 

ITEM 5.

OTHER INFORMATION

 

None.

 

ITEM 6.

EXHIBITS

 

Exhibit
Number		Description of Exhibit
31.01		Certification of Principal Executive Officer Pursuant to Rule 13a-14		Filed herewith.
31.02		Certification of Principal Financial Officer Pursuant to Rule 13a-14		Filed herewith.
32.01		CEO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act		Filed herewith.
32.02		CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act		Filed herewith.
101.INS*		XBRL Instance Document		Filed herewith.
101.SCH*		XBRL Taxonomy Extension Schema Document		Filed herewith.
101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document		Filed herewith.
101.LAB*		XBRL Taxonomy Extension Labels Linkbase Document		Filed herewith.
101.PRE*		XBRL Taxonomy Extension Presentation Linkbase Document		Filed herewith.
101.DEF*		XBRL Taxonomy Extension Definition Linkbase Document		Filed herewith.

 

 

SIGNATURES

 

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	VINCOMPASS CORP.
Date: July 21, 2017	By:	/s/ Peter Lachapelle
	Name:	Peter Lachapelle
	Title:	Chief Executive Officer and Director

 

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

Date: July 21, 2017	By:	/s/ Peter Lachapelle
	Name:	Peter Lachapelle
	Title:	Chief Executive Officer and Director