Attached files
| file | filename |
|---|---|
| EX-32.2 - EXHIBIT 32.2 - PHMC, Inc. | s107331_ex32-2.htm |
| EX-32.1 - EXHIBIT 32.1 - PHMC, Inc. | s107331_ex32-1.htm |
| EX-31.2 - EXHIBIT 31.2 - PHMC, Inc. | s107331_ex31-2.htm |
| EX-31.1 - EXHIBIT 31.1 - PHMC, Inc. | s107331_ex31-1.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2016
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: 333-185146
ORION FINANCIAL GROUP, INC.
(Exact name of registrant as specified in its charter)
| Wyoming | 45-4924646 | |
| (State or other jurisdiction of | (I.R.S Employer Identification No.) | |
| incorporation or organization) | ||
| Mishol Hadkalim 14, Ramat, Jerusalem, Israel | 90900 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code 054-798-0813
1739 Creekstone Circle
San Jose, CA 95133
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
| Securities registered under Section 12(b) of the Act: | ||
| Title of each class: | Name of each exchange on which registered: | |
| None | None | |
| Securities registered under Section 12(g) of the Act: |
| None |
| (Title of class) |
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☒ No ☐
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☐ Yes 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 ☐ No ☒
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not 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. ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| Non-accelerated filer | ☐ | Smaller reporting company | ☒ |
| (Do not check if a 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 Act). ☒ Yes ☐ No
Aggregate market value of the voting and non-voting common equity held by non-affiliates as of August 25, 2017: $0.
As of August 25, 2017, there were approximately 159,999,356 shares of the registrant’s common stock outstanding.
TABLE OF CONTENTS
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION
This Annual Report on Form 10-K (this “Report”) contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements discuss matters that are not historical facts. Because they discuss future events or conditions, forward-looking statements may include words such as “anticipate,” “believe,” “estimate,” “intend,” “could,” “should,” “would,” “may,” “seek,” “plan,” “might,” “will,” “expect,” “predict,” “project,” “forecast,” “potential,” “continue” negatives thereof or similar expressions. Forward-looking statements speak only as of the date they are made, are based on various underlying assumptions and current expectations about the future and are not guarantees. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, level of activity, performance or achievement to be materially different from the results of operations or plans expressed or implied by such forward-looking statements.
We cannot predict all of the risks and uncertainties. Accordingly, such information should not be regarded as representations that the results or conditions described in such statements or that our objectives and plans will be achieved and we do not assume any responsibility for the accuracy or completeness of any of these forward-looking statements. These forward-looking statements are found at various places throughout this Report and include information concerning possible or assumed future results of our operations, including statements about potential acquisition or merger targets; business strategies; future cash flows; financing plans; plans and objectives of management, any other statements regarding future acquisitions, future cash needs, future operations, business plans and future financial results, and any other statements that are not historical facts.
These forward-looking statements represent our intentions, plans, expectations, assumptions and beliefs about future events and are subject to risks, uncertainties and other factors. Many of those factors are outside of our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Report. All subsequent written and oral forward-looking statements concerning other matters addressed in this Report and attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this Report.
Except to the extent required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise.
CERTAIN TERMS USED IN THIS REPORT
When this report uses the words “we,” “us,” “our,” and the “Company,” they refer to Orion Financial Group, Inc. “SEC” refers to the Securities and Exchange Commission.
1
| Item 1. | Business. |
Our Corporate History and Background
Orion Financial Group, Inc. (the “Company” or “Orion”) was incorporated in the State of Wyoming on March 26, 2012. Orion intends to provide strategic financial consulting services to companies requiring advice in the area of corporate growth strategies. The Company intends to provide consulting services until a merger or acquisition candidate can be located to add critical size to our operations.
On May 26, 2017, the Board of Directors appointed Joshua Nadav, to serve as Chairman of the Board of Directors of the Company effective immediately. In addition, on May 26, 2017, the Company accepted the resignation of Kenneth Green as the Company’s President, CEO, Treasurer, Secretary and member of the Board of Directors effective the same date. Mr. Green’s resignations did not arise from any disagreement on any matter relating to the Company’s operations, policies, or practice, nor regarding the general direction of the Company. Additionally, on May 26, 2017, the Company accepted the resignation of Bob Bates as the Company’s CFO, effective the same date. Mr. Bate’s resignation did not arise from any disagreement on any matter relating to the Company’s operations, policies, or practice, nor regarding the general direction of the Company. Further, on May 3, 2017, Lincoln Ong the Company's CTO and Director resigned from the Company effective immediately and on May 4, 2017, Mark Corrao the Company's COO and resigned from the Company effective immediately. Neither of the aforementioned officers and directors resignations were from any disagreement on any matter relating to the Company’s operations, policies, or practice, nor regarding the general direction of the Company. Effective on May 26, 2017, the Company appointed Joshua Nadav to serve as President, CEO, CFO, Treasurer, Secretary and Chairman of the Board.
Industry Overview
Orion seeks to offer its services to clients across North America. The Company seeks to identify viable engagements in various industries including manufacturing, real estate, distribution, energy, logistics, hospitality, air cargo, design & build, architecture & design, food production, viticulture, and aviation support services in states, and provinces across North America. In each case, the target company’s owners or current management team are faced with major corporate development challenges that may prevent them from ascending to the next level of business operations or inhibit strategic acquisitions or divestitures of corporate assets.
Financial Services Market
Orion is focused on providing consulting services to private and public businesses that have the following characteristics: suitable mergers and acquisitions candidate, financially distressed entity, real estate dealings, or desire access to capital markets. Orion’s target company will not be industry specific; however, efforts will be directed at companies with the following attributes:
-Objective to sell, buy, or expand their business;
-Seeking recapitalization;
-Enterprise Value of $.5 to $20 million;
-Profitably operational for at least 3 years;
-Cash flow positive through profitability;
-Auditable financials; and
-Strong management team
Growth Strategy
Orion plans to expand its core consulting services by utilizing a broad marketing strategy as well as looking into strategic acquisitions or joint ventures that will enable the Company to offer clients better products. We will attempt to have strategic alliances to leverage our position as a new player in the financial industry. These partnerships will encompass relationships with more established companies in our space that will enable us to pursue our corporate objectives.
2
Employees
As of the June 30, 2017, we have no full-time employees. From time to time, we may hire additional workers on a contract basis as the need arises.
Smaller reporting companies are not required to provide the information required by this item.
Item 1B. Unresolved Staff Comments
Smaller reporting companies are not required to provide the information required by this item.
Our principal executive office is located at Mishol Hadkalim 14, Ramat, Jerusalem, Israel, 90900 and our telephone number is 054-798-0813. We use this property free of charge.
We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Information
There is presently no public market for our shares of common stock. We are quoted on the OTCBB and under the symbol “ORFN”. However, as of the date hereof, no public market has materialized.
Holders
As of June 30, 2017, we had 85 holders of our common stock.
Common Stock
Our Certificate of Incorporation authorizes the issuance of up to 250,000,000 shares of common stock, par value $0.001 per share.
Dividends
To date, we have not declared or paid any dividends on our common stock. We currently do not anticipate paying any cash dividends in the foreseeable future on our common stock, when issued pursuant to this offering. Although we intend to retain our earnings, if any, to finance the exploration and growth of our business, our Board of Directors will have the discretion to declare and pay dividends in the future.
3
Payment of dividends in the future will depend upon our earnings, capital requirements, and other factors, which our Board of Directors may deem relevant.
Securities Authorized for Issuance Under Equity Compensation Plans
We presently do not have any equity based or other long-term incentive programs. In the future, we may adopt and establish an equity-based or other long-term incentive plan if it is in the best interest of the Company and our stockholders to do so.
Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities
In 2016, the Company issued 30,706,991 in exchange for debt totaling $61,814 to non-accredited investors.
Item 6. Selected Financial Data
Smaller reporting companies are not required to provide the information required by this item.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation
The following discussion provides information which management believes is relevant to an assessment and understanding of our results of operations and financial condition for the fiscal years ended December 31, 2015, through December 31, 2016. The discussion should be read along with our financial statements and notes thereto contained elsewhere in this Report. The following discussion and analysis contains forward-looking statements, which involve risks and uncertainties. Our actual results may differ significantly from the results, expectations and plans discussed in these forward-looking statements. See “Cautionary Statement on Forward-Looking Information.”
Overview
Orion Financial Group, Inc. (the “Company” or “Orion”) was incorporated in the State of Wyoming on March 26, 2012. Orion provides strategic financial consulting services to companies requiring advice in corporate growth strategies. The Company seeks to provide consulting services until a merger or acquisition candidate can be located to add critical size to our operations
Orion seeks to offer its services to clients across North America. The Company seeks to identify viable engagements in various industries including manufacturing, real estate, distribution, energy, logistics, hospitality, air cargo, design & build, architecture & design, food production, viticulture, and aviation support services in states, and provinces across North America. In each case, the target company’s owners or current management team are faced with major corporate development challenges that may prevent them from ascending to the next level of business operations or inhibit strategic acquisitions or divestitures of corporate assets.
Plan of Operations
We are currently a development stage company. We intend to establish business relations throughout various industries that will allow the Company to provide the following services: (1) corporate financial consulting (2) mergers and acquisitions assistance (3) due diligence resources. Additionally, we will reach out to various companies through marketing services to find suitable clients and approach other entities to engage in strategic partnerships or acquisitions.
We will need additional financing to establish business relations and develop our business plan. This may include mergers and acquisitions as well as traditional marketing approaches.
4
Results of Operation
Comparison of the Year Ended December 31, 2016 to the Year Ended December 31, 2015
Revenues: There were no revenues for each period and no change from the prior year.
SG&A Expenses: SG&A Expenses for the year ended December 31, 2016 were $19,914, and $22,838 for the year ended December 31, 2015 which was a decrease of $2,924. This was primarily attributable to further decreased business activity in 2016.
Total Expenses: Total expenses for the year ended December 31, 2016 were $26,143, and $22,838 for the year ended December 31, 2015 which was an increase of $3,305. This was primarily attributable to decreased business activity in 2016 offset by 2016 interest expense on note conversions of $6,229.
Net Loss: We incurred a net loss of $26,143for the year ended December 31, 2016, and a net loss for the year ended December 31, 2015 of $12,838, an increase of $13,305. As discussed above our net loss consisted on interest expense and normal operating expenses as discussed above for both periods
Liquidity and Capital Resources
As of December 31, 2016, we had cash and cash equivalents of $35. The following section provides a summary of our net cash flows from operating, investing, and financing activities. We have historically financed our operations primarily through net cash flow from operations and shareholder investment. It is expected to take longer than 12 months to reach a break-even position. The Company cannot make any guarantee that it will be successful in obtaining funding from any sources or any additional financing or that the terms will be favorable to the Company.
Net cash used by operating activities was $(11,739) from January 1, 2016 through December 31, 2016 which was primarily attributable to the operating loss.
Net cash flow from investing activities was $0 from January 1, 2016 through December 31, 2016.
Net cash flow from financing activities was $11.767 from January 1, 2016 through December 31, 2016.
Critical Accounting Policies
The Company’s significant accounting policies are presented in the Company’s notes to financial statements for the period ended December 31, 2016 which are contained in this filing. The significant accounting policies that are most critical and aid in fully understanding and evaluating the reported financial results include the following:
The Company prepares its financial statements in conformity with generally accepted accounting principles in the United States of America. These principals require 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. Management believes that these estimates are reasonable and have been discussed with the Board of Directors; however, actual results could differ from those estimates.
Since, we have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the JOBS Act, this election allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.
5
Recent Accounting Pronouncements
As of and for the years ended December 31, 2016, the Company does not expect any of the recently issued accounting pronouncements to have a material impact on its financial condition or results of operations.
Management Consideration of Alternative Business Strategies
In order to continue to protect and increase shareholder value management believes that it may, from time to time, consider alternative management strategies to create value for the company or additional revenues. Strategies to be reviewed may include acquisitions; roll-ups; strategic alliances; joint ventures on large projects; and/or mergers.
Management will only consider these options where it believes the result would be to increase shareholder value while continuing the viability of the company.
Off-Balance Sheet Arrangements
None.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Smaller reporting companies are not required to provide the information required by this item.
Item 8. Financial Statements and Supplementary Data
| Index to Financial Statements | Page |
| Income Statements | F-3 |
| Balance Sheets | F-2 |
| Cash Flows Statements | F-4 |
| Stockholders’ Equity Statements | F-6 |
| Notes to Financial Statements | F-7 |
| Reports of Independent Registered Public Accounting Firms | F 1 |
6
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders
Orion Financial Group Inc.
San Jose, California
We have audited the accompanying balance sheets of Orion Financial Group, Inc. (the “Company”) as of December 31, 2016 and 2015 and the related statements of expenses, changes in stockholders’ equity, and cash flows for the year ended December 31, 2016 and 2015. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with 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 misstatements. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2016 and 2015 and the results of its operations and its cash flows for the year ended December 31, 2016 and 2015 in 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 has no source of revenue, which raises substantial doubt about its ability to continue as a going concern. Management’s plans regarding those matters are described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ DLL CPAS, LLC
DLL CPAS
Savannah, GA
August 17, 2017
F-1
ORION FINANCIAL GROUP, INC.
| 31-Dec-16 | 31-Dec-15 | |||||||
| (Audited) | (Audited) | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and Cash Equivalents | $ | 35 | $ | 7 | ||||
| Total Current assets | 35 | 7 | ||||||
| Total Assets | $ | 35 | $ | 7 | ||||
| Liabilities and Equity(Deficit) | ||||||||
| Current liabilities | ||||||||
| Accrued Expenses | $ | 15,000 | $ | 15,000 | ||||
| Notes Payable - Related Party | 15,603 | 65,650 | ||||||
| Total Current Liabilities | 30,603 | 80,650 | ||||||
| Commitments and Contingencies - Note 6 | ||||||||
| ORION FINANCIAL GROUP, INC. Shareholders’ Equity(Deficit) | ||||||||
| Preferred Stock, $0.001 par value; 5,000,000 shares authorized, 0 and 8, issued and outstanding 12/31/2016 & 12/31/2015, respectively. | 0 | 0 | ||||||
| Common Stock, $0.001 par value; 250,000,000 shares authorized, 158,199,356 and 113,087,913, issued and outstanding at 12/31/2016 & 12/31/2015, respectively. | 158,199 | 113,088 | ||||||
| Additional Paid in Capital | 163,937 | 132,830 | ||||||
| Accumulated Deficit | (352,704 | ) | (326,561 | ) | ||||
| Total Equity(Deficit) | (30,568 | ) | (80,643 | ) | ||||
| Total Liabilities and Equity(Deficit) | $ | 35 | $ | 7 | ||||
“The accompanying notes are an integral part of these financial statements”
F-2
ORION FINANCIAL GROUP, INC.
| For the Year Ended December 31, | ||||||||
| 2016 | 2015 | |||||||
| (Audited) | (Audited) | |||||||
| Revenues | $ | 0 | $ | 0 | ||||
| Operating Expenses | 19,914 | 22,838 | ||||||
| Net Income (Loss) from Operations | (19,914 | ) | (22,838 | ) | ||||
| Other Income (Expenses) | ||||||||
| Interest Expense | (6,229 | ) | 0 | |||||
| Net Income(Loss) from Operations Before Income Taxes | (26,143 | ) | (22,838 | ) | ||||
| Tax Expense | 0 | 0 | ||||||
| Net Income(Loss) | $ | (26,143 | ) | $ | (22,838 | ) | ||
| Basic and Diluted Loss Per Share | $ | (0.0002 | ) | $ | (0.0002 | ) | ||
| Weighted average number of shares outstanding | 126,758,635 | 107,382,647 | ||||||
“The accompanying notes are an integral part of these financial statements”
F-3
ORION FINANCIAL GROUP, INC.
| For the Year Ended December 31, | ||||||||
| 2016 | 2015 | |||||||
| (Audited) | (Audited) | |||||||
| Cash flows from operating activities: | ||||||||
| Net income (loss) | $ | (26,143 | ) | $ | (22,838 | ) | ||
| Stock Issued as Compensation | 236 | 2,478 | ||||||
| Stock Issued as Compensation - related parties | 14,168 | 11,493 | ||||||
| Net cash used in operating activities | (11,739 | ) | (8,867 | ) | ||||
| Cash flows from investing activities: | ||||||||
| None | 0 | 0 | ||||||
| Net cash provided(used) by investing activities | 0 | 0 | ||||||
| Cash flows from financing activities: | ||||||||
| Common stock issued | 0 | 0 | ||||||
| Proceeds from related party loans | 11,767 | 8,817 | ||||||
| Repayments to related party loans | 0 | 0 | ||||||
| Net cash provided(used) by financing activities | 11,767 | 8,817 | ||||||
| Increase in cash and equivalents | 28 | (50 | ) | |||||
| Cash and cash equivalents at beginning of period | 7 | 57 | ||||||
| Cash and cash equivalents at end of period | $ | 35 | $ | 7 | ||||
“The accompanying notes are an integral part of these financial statements”
F-4
ORION FINANCIAL GROUP, INC.
STATEMENT OF CASH FLOWS - CONTINUED
| For the Year Ended December 31, | ||||||||
| 2016 | 2015 | |||||||
| (Audited) | (Audited) | |||||||
| SUPPLEMENTAL DISCLOSURE OFCASH FLOW INFORMATION | ||||||||
| None | $ | 0 | $ | 0 | ||||
| SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||||||||
| Debt for equity exchange | $ | 61,814 | $ | 0 | ||||
“The accompanying notes are an integral part of these financial statements”
F-5
ORION FINANCIAL GROUP, INC.
STATEMENT OF STOCKHOLDER’S EQUITY
FOR THE YEARS ENDED DECEMBER 31 2016 AND 2015
“Audited”
| Preferred Stock | Preferred Stock | Common Stock | Common Stock | Contributed | Accumulated | |||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Deficit | Total | ||||||||||||||||||||||
| Balances December 31, 2014 | 8 | 0 | 99,116,715 | 99,117 | 132,830 | (303,723 | ) | (71,776 | ) | |||||||||||||||||||
| Common issued for serices | 0 | 0 | 13,971,200 | 13,971 | 0 | 0 | 13,971 | |||||||||||||||||||||
| Net Income 2015 | 0 | 0 | 0 | 0 | 0 | (22,838 | ) | (22,838 | ) | |||||||||||||||||||
| Balances December 31, 2015 | 8 | 0 | 113,087,915 | 113,088 | 132,830 | (326,561 | ) | (80,643 | ) | |||||||||||||||||||
| Common issued for services | 0 | 0 | 14,404,450 | 14,404 | 0 | 0 | 14,404 | |||||||||||||||||||||
| Common exchanged for debt | 0 | 0 | 30,706,991 | 30,707 | 31,107 | 0 | 61,814 | |||||||||||||||||||||
| Net Income 2016 | 0 | 0 | 0 | 0 | 0 | (26,143 | ) | (26,143 | ) | |||||||||||||||||||
| Balances December 31, 2016 | 8 | $ | 0 | 158,199,356 | $ | 158,199 | $ | 163,937 | $ | (352,704 | ) | $ | (30,568 | ) | ||||||||||||||
“The accompanying notes are an integral part of these financial statements”
F-6
(A Development Stage Company)
Note 1 - Organization And Nature of Business
Orion Financial Group Inc. (the “Company”) was incorporated in the state of Wyoming on March 26, 2012 with an authorized capital of 100,000,000 shares, which was subsequently increased to 250,000,000 shares of common stock, par value of $0.001 per share. The Company’s principal operations are now located in Mishol Hadkalim 14, Ramat, Jerusalem, Israel, 90900. The Company provides consulting to small public and private companies. The Company has selected December 31 as its fiscal year end.
Note 2 - Summary of Significant Accounting Policies
Basis of Presentation
The accompanying financial statements have been prepared on the accrual basis of accounting in accordance with generally accepted accounting principles in the United States.
Use Of Estimates
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.
Cash and Cash Equivalents
The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.
Earnings per Share
The Company computes net earnings per share in accordance with ASC 260 “Earnings per Share”. ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including stock options, using the treasury stock method, and convertible preferred stock, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential common shares if their effect is anti-dilutive.
Income Taxes
The Company accounts for income taxes using the asset and liability approach. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the 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 income in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized.
F - 7
Recent Accounting Pronouncements
The Company does not expect the adoption of any recently issued accounting pronouncements to have a significant effect on its financial statements.
Note 3 – Going Concern
The Company’s financial statements are prepared using generally accepted accounting principles applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not established any source of revenue to cover its operating costs. If the Company is unable to obtain revenue producing contracts or financing, or if the revenue or financing it does obtain is insufficient to cover any operating losses it may incur, it may substantially curtail or terminate its operations or seek other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of existing stockholders. These conditions raise substantial doubt as to the Company’s ability to continue as a going concern.
Note 4 – Equity
The Company has 250,000,000 shares of Voting Common Stock authorized at $0.001 par value. As of December 31, 2016, there were 158,999,356 shares outstanding. The Company also has authorized on April 17, 2014 5,000,000 of Series A Voting Preferred Shares issued with a par value of $0.001. These shares collective carry allocated voting rights between the outstanding shares equivalent to 80 percent of the common shares outstanding. There were 0 Series A Voting Preferred Shares outstanding as of December 31, 2016.
Note 5– Income Taxes
The Company follows Accounting Standards Codification 740, Accounting for Income Taxes.
The Company did not have taxable income for the period from January 1, 2015 through December 31, 2016. The Company’s deferred tax assets consisted of the following as of December 31:
| 2016 | 2015 | |||||||
| Net operating losses carried forward | $ | 352,704 | $ | 316,561 | ||||
| Valuation allowance | (352,704 | ) | (316,561 | ) | ||||
| Net deferred income tax asset | $ | 0 | $ | 0 | ||||
The Company has net operating losses carried forward of $352,704 available to offset taxable income in future years which begins expiring in 2023.
Note 6– Commitments and Contingencies
None.
F - 8
Note 7– Related party transactions
During the years ended December 31, 2015 and 2016 there was $5,180 and $0paid for consulting services to our CEO at that time. As of December 31, 2016, $11,417 was due to related parties for services and expenses paid on behalf of the Company.
Shareholder loans to the company were $8,818 in the year ended December 2015, and $11,767 in the year ended December 2016. On September 9, 2016 $55,585 was converted into common stock along with $6,229 of accrued interest expense which was recorded at that time. Two notes totaling $4,046 was assigned and all remaining debt was assumed by our founder subsequently to December 31, 2016 as part of the change of control transaction.
Note 8 – Subsequent Events
On June 1, 2017, there was a change in control of the Company through a private share transaction. Details are provided on Form 8-K.
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Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Malone Bailey, LLP resigned as independent registered public accountant of Orion Financial Group, Inc. (the “Company”). On August 10, 2017, the Company engaged DLL CPAs, LLC ("DLL") as our new independent principal accountant to audit the Company’s financial statements and to perform reviews of interim financial statements. Neither the Company, nor anyone on its behalf has consulted DLL with respect to (i) the application of accounting principles to a specified transaction, either completed or proposed; or (ii) any matter that was either the subject of a disagreement with MaloneBailey or a reportable event with respect to MaloneBailey; (iii) the type of audit opinion that might be rendered on the Company’s financial statements, and none of the following was provided to the Company: (a) a written report, or (b) oral advice that DLL concluded was an important factor considered by the Company in reaching a decision as to accounting, auditing or financial reporting issue; or (iv) Any matter that was the subject of a disagreement, as that term is defined in Item 304(a)(1)(iv) of Regulation S-K. The decision to engage DLL was approved by the Company’s Board of Directors.
Item 9A. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”), the Company carried out an evaluation, with the participation of the Company’s management, including the Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) (the Company’s principal financial and accounting officer), of the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, the Company’s CEO and CFO concluded that the Company’s disclosure controls and procedures are not effective 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 SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.
Management’s Annual Report on Internal Control Over Financial Reporting
Evaluation of Disclosure Controls and Procedures
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 Securities Exchange Act of 1934, as amended (the “Act”) is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote. As of the end of the period covered by this Annual Report, we carried out an evaluation, under the supervision and with the participation of our Chief Accounting Officer and Chief Executive Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our Chief Accounting Officer and Chief Executive Officer have concluded that the Company’s disclosure controls and procedures are not effective due to the identification of material weaknesses in our internal controls.
Management’s Annual Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes, in accordance with generally accepted accounting principles. Because of inherent limitations, a system of internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate due to change in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
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Our management conducted an evaluation of the effectiveness of our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework. Based on its evaluation, our management concluded that our internal controls over financial reporting are not effective due to material weaknesses in areas covering impairment determination, revenue recognition and supervisory responsibilities.
In assessing the effectiveness of our internal control over financial reporting, management identified the following material weakness in internal control over financial reporting for all of the following periods, December 31, 2015 through December 31, 2016:
| • | Deficiencies in Segregation of Duties. The Chief Executive Officer and the Chief Financial Officer are actively involved in the preparation of the financial statements, and therefore cannot provide an independent review. |
The transactional controls of cash and assets for the subsidiaries are adequate.
This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to the attestation by the Company’s registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only management’s report in this annual report.
Changes in Internal Controls Over Financial Reporting
We have not yet made any changes in our internal controls over financial reporting that occurred during the period covered by this report on Form 10-K that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
On November 25, 2013, the Company filed an amendment to the Company’s Articles of Incorporation with the State of Wyoming, which increased the Company’s authorized shares of common stock, $0.001 par value per share from 100,000,000 shares to 250,000,000 shares.
Item 10. Directors, Executive Officers and Corporate Governance.
The following table sets forth the name and age of officers and director as of August 25, 2017. Our Executive officers are elected annually by our Board of Directors.
| Name | Age | Position | ||
| Joshua Nadav(1) | 29 | President, CEO, CFO, Treasurer, Secretary and Chairman of the Board of Directors |
| (1) | Mr. Nadav has served as President, CEO, CFO, Treasurer, Secretary and Chairman of the Board of Directorsfrom May 26, 2017 to present. |
On May 26, 2017, the Board of Directors appointed Joshua Nadav, to serve as Chairman of the Board of Directors of the Company effective immediately. In addition, on May 26, 2017, the Company accepted the resignation of Kenneth Green as the Company’s President, CEO, Treasurer, Secretary and member of the Board of Directors effective the same date. Mr. Green’s resignations did not arise from any disagreement on any matter relating to the Company’s operations, policies, or practice, nor regarding the general direction of the Company. Additionally, on May 26, 2017, the Company accepted the resignation of Bob Bates as the Company’s CFO, effective the same date. Mr. Bate’s resignation did not arise from any disagreement on any matter relating to the Company’s operations, policies, or practice, nor regarding the general direction of the Company. Further, on May 3, 2017, Lincoln Ong the Company's CTO and Director resigned from the Company effective immediately and on May 4, 2017, Mark Corrao the Company's COO and resigned from the Company effective immediately. Neither of the aforementioned officers and directors resignations were from any disagreement on any matter relating to the Company’s operations, policies, or practice, nor regarding the general direction of the Company. Effective on May 26, 2017, the Company appointed Joshua Nadav to serve as President, CEO, CFO, Treasurer, Secretary and Chairman of the Board.
Set forth below is a brief description of the background and business experience of our executive officer and director for the past five years.
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Joshua Nadav, has been working with small to median size business providing a broad array of services and solutions for small businesses. Offering merchant cash advances, small business loans, SBA loans, equipment financing, factoring, purchase order financing and commercial mortgages nationwide. Joshua also works with merchants providing credit card processing, personal and business credit repair.
Term of Office
Our directors are appointed for a one-year term to hold office until the next annual general meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board.
Certain Legal Proceedings
To the best of our knowledge, none of our directors or executive officers has, during the past ten years:
| ● | been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); |
| ● | had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time; |
| ● | been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity; |
| ● | been found by a court of competent jurisdiction in a civil action or by the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated; |
Except as set forth in our discussion below in “Certain Relationships and Related Transactions,” none of our directors or executive officers has been involved in any transactions with us or any of our directors, executive officers, affiliates or associates which are required to be disclosed pursuant to the rules and regulations of the SEC.
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Compliance with Section 16(a) of the Exchange Act
The Company does not have a class of securities registered under the Exchange Act and therefore its directors, executive officers, and any persons holding more than ten percent of the Company’s common stock are not required to comply with Section 16 of the Exchange Act.
Code of Ethics
We have not adopted a code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer, or persons performing similar functions, because of the small number of persons involved in the management of the Company.
Board Committees
Our Board of Directors has no separate committees and our Board of Directors acts as the audit committee and the compensation committee. We do not have an audit committee financial expert serving on our Board of Directors.
Item 11. Executive Compensation.
Summary Compensation Table
The following table sets forth information regarding each element of compensation that we paid or awarded to our executive officers for fiscal years 2015 through 2016.
| Name and
Principal Position | Year | Salary | Bonus | Stock
Awards ($) | Option Awards | Non- Qualified Deferred Compensation Earnings | All Other
Compensation | Totals ($) | ||||||||||||||||||||||||
| Kenneth Green(1) | 2016 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||
| Kenneth Green(1) | 2015 | 0 | 0 | 0 | 0 | 0 | 5,180 | 5,180 | ||||||||||||||||||||||||
| (1) | Mr. Green resigned as President, CEO, Treasurer, Secretary and Chairman of the Board of Directors on May 26, 2017. |
Director Compensation
We have provided no compensation to our directors for their services provided as directors.
Employment Agreements
We do not have any employment agreements with any of our officers.
Compensation Committee Interlocks and Insider Participation
Our Board of Directors does not have a compensation committee and the entire Board of Directors performs the functions of a compensation committee. No member of our Board of Directors has a relationship that would constitute an interlocking relationship with our executive officers or directors or another entity.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information as of August 25, 2017 with respect to the holdings of: (1) each person known to us to be the beneficial owner of more than 5% of our common stock; (2) each of our directors, nominees for director and named executive officers; and (3) all directors and executive officers as a group. To the best of our knowledge, each of the persons named in the table below as beneficially owning the shares set forth therein has sole voting power and sole investment power with respect to such shares, unless otherwise indicated.
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| Amount and Nature of Beneficial Ownership of Common Stock | Percent of Common Stock | |||||||
| 5% Shareholders | ||||||||
| MY Tabatabaei, LLLP | 16,787,000 | 10.492 | % | |||||
| Directors and Executive Officers | ||||||||
| Joshua Nadav | 93,522,000 | 58.451 | ||||||
| TOTAL | 70.7684 | % | ||||||
(1) Unless otherwise, noted, the address of each beneficial owner is c/o Orion Financial Group, Incorporated, 1739 Creekstone Circle, San Jose, CA 95133.
(2) Based on 159,999,356 shares of common stock issued and outstanding as of July 31, 2017.
(3) The beneficial owner of Pegasus Motorsports, LLLP is Kenneth Green.
(4) The beneficial owner of Catalyst Group Holdings, LLLP is Kenneth Green.
(5) Owned via Pegasus Motorsports, LLLP, The Orion Fund 501(c)(3), and Catalyst Group Holdings, LLLP.
(6) Owned via Orsus, LLLP, Po Box 60667, Palo Alto, CA 94306. Lincoln Ong is the controlling shareholder of Orsus, LLLP.
We are not aware of any arrangements which may at a subsequent date result in a change of control of the Company.
Item 13. Certain Relationships and Related Transactions, and Director Independence
Except as disclosed below, there have been no transactions since January 1, 2015 in which the amount involved exceeds the lesser of $120,000 or one percent of the average of the Company’s total assets at year end for the last two completed fiscal years in which any related person had or will have a direct or indirect material interest:
During the years ended December 31, 2015 and 2016 there was $5,180 and $0paid for consulting services to our CEO at that time. As of December 31, 2016, $11,417 was due to related parties for services and expenses paid on behalf of the Company.
Shareholder loans to the company were $8,818 in the year ended December 2015, and $11,767 in the year ended December 2016. On September 9, 2016 $55,585 was converted into common stock along with $6,229 of accrued interest expense which was recorded at that time. Two notes totaling $4,046 was assigned and all remaining debt was assumed by our founder subsequently to December 31, 2016 as part of the change of control transaction.
Tax Fees
For the Company’s fiscal years ended December 31, 2015 through December 31, 2016, we were not billed for professional services rendered for tax compliance, tax advice, and tax planning by our auditors.
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Director Independence
We do not have any independent directors. Because our common stock is not currently listed on a national securities exchange, we have used the definition of “independence” of The NASDAQ Stock Market to make this determination. NASDAQ Listing Rule 5605(a)(2) provides that an “independent director” is a person other than an officer or employee of the company or any other individual having a relationship which, in the opinion of the Company’s Board of Directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. The NASDAQ listing rules provide that a director cannot be considered independent if:
| ● | the director is, or at any time during the past three years was, an employee of the company; |
| ● | the director or a family member of the director accepted any compensation from the company in excess of $120,000 during any period of 12 consecutive months within the three years preceding the independence determination (subject to certain exclusions, including, among other things, compensation for board or board committee service); |
| ● | a family member of the director is, or at any time during the past three years was, an executive officer of the company; |
| ● | the director or a family member of the director is a partner in, controlling stockholder of, or an executive officer of an entity to which the company made, or from which the company received, payments in the current or any of the past three fiscal years that exceed 5% of the recipient’s consolidated gross revenue for that year or $200,000, whichever is greater (subject to certain exclusions); |
| ● | the director or a family member of the director is employed as an executive officer of an entity where, at any time during the past three years, any of the executive officers of the company served on the compensation committee of such other entity; or |
| ● | the director or a family member of the director is a current partner of the company’s outside auditor, or at any time during the past three years was a partner or employee of the company’s outside auditor, and who worked on the company’s audit. |
Ken Green, and Bob Bates are not considered independent because they are executive officers of the Company.
We do not currently have a separately designated audit, nominating or compensation committee.
Item 14. Principal Accounting Fees and Services
Audit Fees
For the Company’s fiscal years ended December 31, 2015 and 2016, we were billed approximately $3,000 and $3,000 respectively for professional services rendered for the audit and reviews of our financial statements.
Audit Related Fees
All Other Fees
The Company did not incur any other fees related to services rendered by our principal accountant for the fiscal years ended December 31, 2015 through December 31, 2016.
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Item 15. Exhibits, Financial Statement Schedules.
(a) The following documents are filed as part of this report:
Financial Statements: See “Index to Consolidated Financial Statements” in Part II, Item 8 of this Report.
Exhibits: The exhibits listed in the accompanying index to exhibits are filed or incorporated by reference as part of this Report.
(b) The following are exhibits to this Report and, if incorporated by reference, we have indicated the document previously filed with the SEC in which the exhibit was included.
Certain of the agreements filed as exhibits to this Report contain representations and warranties by the parties to the agreements that have been made solely for the benefit of the parties to the agreement. These representations and warranties:
| ● | may have been qualified by disclosures that were made to the other parties about the negotiation of the agreements, which disclosures are not necessarily reflected in the agreements; |
| ● | may apply standards of materiality that differ from those of a reasonable investor; and |
| ● | were made only as of specified dates contained in the agreements and are subject to subsequent developments and changed circumstances. |
Accordingly, these representations and warranties may not describe the actual state of affairs as of the date that these representations and warranties were made or at any other time. Investors should not rely on them as statements of fact.
In accordance with SEC Release 33-8238, Exhibits 32.1 and 32.2 are being furnished and not filed.
* Furnished herewith. XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
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Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| ORION FINANCIAL GROUP, INC. | ||
| By: | /s/ Joshua Nadav | |
| Joshua Nadav | ||
| Chief Executive Officer, CFO | ||
Pursuant to the requirements 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 | ||
| /s/Joshua Nadav | President, Chief Executive Officer, CFO Secretary and Director | August 30, 2017 | ||
| Joshua Nadav | (Principal Executive Officer) |
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