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EX-31.2 - CERTIFICATION - Resort Savers, Inc.rssv_ex312.htm
EX-32.1 - CERTIFICATION - Resort Savers, Inc.rssv_ex321.htm
EX-31.1 - CERTIFICATION - Resort Savers, Inc.rssv_ex311.htm
EX-21.1 - SUBSIDIARIES - Resort Savers, Inc.rssv_ex211.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-K

 

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended January 31, 2018

 

or

 

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ___________ to ___________

 

Commission file number: 000-55319

 

RESORT SAVERS, INC.

(Exact name of registrant as specified in its charter)

 

Nevada

 

46-1993448

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

No. 10-2-4B, Jin Di Shang Tang Garden, Long Hua Xin Qu Shang Tang Road

Shenzhen, Guangdong Province, the People’s Republic of China 518000

(Address of principal executive office)

 

Registrant’s telephone number, including area code: 0086-0755-23106825

 

Securities registered pursuant to Section 12(b) of the Act:

 

N/A

 

N/A

Title of Each Class

 

Name of Each Exchange On Which Registered

 

Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $0.0001

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No x

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x

 

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 last 90 days. Yes x No o

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, 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 registration statement was required to submit and post such files). Yes x No o

 

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. o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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

o

Accelerated filer

o

Non-accelerated filer

o

Smaller reporting company

x

(Do not check if a smaller reporting company)

Emerging growth 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. o

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x

 

The aggregate market value of the voting and non-voting common equity held by non-affiliates on July 31, 2017 was approximately $12,600,000.

 

Indicate the number of shares outstanding of each of the registrant’s classes of common stock as of the latest practicable date: 74,976,241 shares as of May 16, 2018

 

DOCUMENTS INCORPORATED BY REFERENCE

 

None.

 

 
 
 
 

 

TABLE OF CONTENTS

 

Page

 

PART I

 

Item 1.

Business.

4

Item 1A.

Risk Factors.

7

 

Item 1B.

Unresolved Staff Comments.

8

 

Item 2.

Properties.

8

 

Item 3.

Legal Proceedings.

8

 

Item 4.

Mine Safety Disclosures

8

PART II

 

Item 5.

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

9

Item 6.

Selected Financial Data.

11

Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

11

Item 7A.

Quantitative and Qualitative Disclosures About Market Risk.

14

Item 8.

Financial Statements and Supplementary Data.

15

Item 9.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

32

Item 9A.

Controls and Procedures.

32

Item 9B.

Other Information.

33

PART III

 

Item 10.

Directors, Executive Officers and Corporate Governance.

34

Item 11.

Executive Compensation.

37

Item 12.

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

39

Item 13.

Certain Relationships and Related Transactions, and Director Independence.

40

Item 14.

Principal Accounting Fees and Services.

41

PART IV

Item 15.

Exhibits, Financial Statement Schedules.

42

Signatures.

43

 

 
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Cautionary Note Regarding Forward-Looking Statements

 

This Annual Report on Form 10-K contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. 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,” “pursue,” “expect,” “predict,” “project,” “goals,” “strategy,” “future,” “likely,” “forecast,” “potential,” “continue,” negatives thereof or similar references to future periods. Examples of forward-looking statements include, among others, statements we make regarding future acquisition or merger targets, business strategies, macro-economic and sector-specific trends, future cash flows, financing plans, plans and objectives of management and any other statements which are not statements of historical facts.

 

Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual future results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, inability to successfully conclude acquisitions of target companies which generate positive cash flow, legal and regulatory changes in the jurisdictions in which we operate, volatility or decline in our stock price, potential fluctuation of our quarterly results, rapid adverse changes in markets, decline in demand for our goods and services, insufficient revenues to cover our operating costs and such other factors as discussed in the sections “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” within this Annual Report on Form 10-K.

 

Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

 

All references in this Annual Report on Form 10-K to the “Company,” “Resort Savers,” “RSSV,” “we,” “us” or “our” are to Resort Savers, Inc.

 

 
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Part I

Item 1. Business.

 

Resort Savers, Inc. was incorporated in the State of Nevada on June 25, 2012. At formation, the Company was authorized to issue 100,000,000 shares of common stock, par value $0.0001 per share, and 15,000,000 shares of preferred stock, par value $0.0001 per share. Our fiscal year end is January 31. Resort Savers has limited cash on hand. We have sustained losses since inception and have relied solely upon the sale of our securities for funding. Resort Savers has never declared bankruptcy, been in receivership, or been involved in any kind of legal proceeding.

 

On August 1, 2014, a change of control of the Company occurred, whereby a controlling interest in the Company was sold by Michelle LaCour, our former President, Chief Executive Officer, Chief Financial Officer, Treasurer and Director and a former 5% stockholder, and James LaCour, our former Secretary and Director and a former 5% stockholder, to the following: (1) Zhou Gui Bin (236,733 shares at a purchase price of $0.20 per share); (2) Zhou Wei (236,733 shares at a purchase price of $0.20 per share); and (3) Zong Xin International Investment Holdings Co. LTD (“Zong Xin”) (1,636,734 shares at a purchase price of $0.20 per share). On August 11, 2014, in connection with the transfer of shares described in this paragraph, Ms. LaCour and Mr. LaCour resigned from each of their roles as officers and Directors of the Company, and they were replaced by Zhou Gui Bin as President, CEO and Director, and Zhou Wei as Treasurer, CFO, Secretary and Director.

 

On September 25, 2014 the Company effected a forward stock split of 10 shares of common stock for each share held, or an additional nine shares were issued for each common share held. All share and per share information has been retroactively restated for financial presentation of prior periods.

 

Worx America, Inc.

 

From January 2015 through March 2015, the Company, by and through its wholly owned subsidiary, Xing Rui International Investment Holding Group Co., Ltd., a Seychelles corporation (“Xing Rui”), acquired 20,068,750 shares of common stock (representing 20% of the issued and outstanding common stock) of Worx America, Inc. (“Worx”), a private company based in Houston, Texas, in exchange for $1,650,000 cash and 1,000,000 shares of common stock of BRI with a value of $350,000. Specifically, on January 28, 2015, the Company paid $350,000 cash in exchange for 5,403,728 common shares of Worx, on March 20, 2015, the Company paid $1,300,000 cash and transferred 1,000,000 shares of common stock of BRI in exchange for 14,665,022 common shares of Worx. The Company accounted for this investment using the equity method, with an initial cost of $2,000,000.

 

A description of the products, services, principal market and distribution methods of Worx can be found within this Part I, Item 1 under the heading “Principal Products, Services and Their Markets.”

 

Shenzhen Amuli Industrial Development Co. Ltd.

 

On October 1, 2015, the Company issued 3,033,926 shares of its common stock to Xu Xiao Yun in exchange for sixty percent (60%) of Shenzhen Amuli Industrial Development Co. Ltd., a PRC corporation (“Amuli”). The Company caused Xing Rui to form a subsidiary in the People’s Republic of China (the “PRC”), called Huaxin Changrong (Shenzhen) Technology Service Company Limited (“Huaxin”), to hold the equity of Amuli that was transferred by Xu Xiao Yun. The purchase price was valued $2,400,000.

 

Apart from the transactions described in the preceding paragraph, neither the Company nor any of its subsidiaries has a material relationship with either Mr. Xu Xiao Yun or Amuli.

 

A description of the products, services, principal market and distribution methods of Amuli can be found within this Part I, Item 1 under the heading “Principal Products, Services and Their Markets.”

 

Amendment to Articles of Incorporation

 

On October 9, 2015, we amended our articles of incorporation to increase the maximum number of authorized shares of common stock to 1,000,000,000 shares. We did not amend the amount of authorized shares of preferred stock or par values for common stock or preferred stock.

 

Beijing Yandong Tieshan Oil Products Co., Ltd.

 

On January 29, 2016, the Company entered into an Exchange Agreement (the “Tieshan Oil Exchange Agreement”) with Mr. Yang Baojin, a citizen of the PRC, and Huaxin, which is a wholly owned subsidiary of Xing Rui, which in turn is a wholly owned subsidiary of the Company. Mr. Yang is the president and majority owner of Beijing Yandong Tieshan Oil Products Co., Ltd. (“Tieshan Oil”). Pursuant to the Tieshan Oil Exchange Agreement, the Company issued 4,800,000 shares of its common stock to Mr. Yang, who delivered to Huaxin an ownership interest in Tieshan Oil such that Huaxin now owns 51% of all ownership interests in Tieshan Oil (the “Tieshan Oil Exchange”). The Company held 1,200,000 shares of its common stock in escrow (the “Escrow Shares”) to issue to Mr. Yang twelve months following the closing of the Tieshan Oil Exchange, in connection with the successful performance of certain covenants by Mr. Yang. The Company did not issue the Escrow Shares to Mr. Yang in connection with the Tieshan Oil Exchange.

 

 
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The Tieshan Oil Exchange Agreement was approved by a written consent of the Board of Directors of the Company on January 29, 2016 and the closing of the Tieshan Oil Exchange occurred concurrently with the execution and delivery of the Tieshan Oil Exchange Agreement. As a result of the closing of the Tieshan Oil Exchange, Huaxin now owns a majority of the ownership interest of Tieshan Oil. The total value of the exchange, based on the value of the Company’s common stock as of the close of trading on January 28, 2016, was $3,435,000.

 

Apart from the Tieshan Oil Exchange, neither the Company nor Huaxin has a material relationship with either Mr. Yang or Tieshan Oil.

 

A description of the products, services, principal market and distribution methods of Tieshan Oil can be found within this Part I, Item 1 under the heading “Principal Products, Services and Their Markets.”

 

Abandonment of Plans to Acquire Dusun Eco Resort (2005) Sdn. Bhd.

 

On December 7, 2017, the Company entered into a Share Exchange Agreement (the “Dusun Exchange Agreement”) with Dusun Eco Resort (2005) Sdn. Bhd., a limited liability company registered under the laws of Malaysia (“Dusun Eco”), and the shareholders of Dusun Eco (the “Dusun Sellers”), by which the Company agreed to acquire all of the issued and outstanding stock of Dusun Eco in exchange for the issuance of 400,000,000 shares of the Company’s common stock. After further review of the due diligence materials related to the Exchange, the Company’s Board of Directors felt that it was in the Company’s best interest to terminate the Dusun Exchange Agreement. On February 9, 2018, the Company, Dusun Eco and the Dusun Sellers entered into a Termination of Share Exchange Agreement (the “Dusun Termination Agreement”), by which the Company, Dusun Eco and the Dusun Sellers agreed to terminate the Dusun Exchange Agreement with no legal consequence to any of the parties to the Dusun Exchange Agreement.

 

Entry into Share Exchange Agreement with Admall Sdn. Bhd.

 

On February 9, 2018, the Company entered into a Share Exchange Agreement (the “Admall Exchange Agreement”) with Admall Sdn. Bhd., a limited liability company incorporated in Malaysia (“Admall”), and each of Admall’s shareholders (collectively, the “Admall Sellers”), pursuant to which, among other things and subject to the terms and conditions contained therein, the Company will effect an acquisition of Admall by acquiring from the Sellers all outstanding equity interests of Admall in exchange for 400,000,000 shares of common stock of the Company (the “Admall Acquisition”).

 

The obligation of the parties to complete the Admall Acquisition is subject to the fulfillment or waiver of certain closing conditions, including but not limited to (i) the approval of the Admall Exchange Agreement and the transactions contemplated thereby by the Company’s Board of Directors and stockholders; (ii) all necessary consents from government authorities and third parties have been obtained; and (iii) no adverse effect has occurred to any party as of the closing of the Admall Acquisition.

 

Concurrently with the execution of the Admall Exchange Agreement, the Board of Directors appointed Mr. Boon Jin “Patrick” Tan to be the treasurer, CFO and Director of the Company. Mr. Tan is the founder and director of Admall. Apart from the appointment of Mr. Tan as Director and officer of the Company, and the transactions pursuant to the Admall Exchange Agreement, the Company does not have a material relationship with Admall or any of the Admall Sellers.

 

Change of Management

 

On February 9, 2018, concurrently with the execution of the Admall Exchange Agreement and the Dusun Termination Agreement, Zhou Gui Bin resigned from his positions as President, CEO, Secretary and Director of the Company, and Zhou Wei resigned from his positions as Treasurer, CFO and Director of the Company. The departing Directors approved, by written consent in lieu of special meeting of the Board of Directors, the appointment of Mr. Ding-Shin “DS” Chang and Mr. Patrick Tan as the new Directors of the Company and submitted such appointment for approval and ratification by the Company’s stockholders. The Company’s departing Directors also appointed Mr. DS Chang as the Company’s President and CEO, Mr. Patrick Tan as the Company’s Treasurer and CFO, and Mr. Liang-Yu “Jacky” Chang as the Company’s Secretary, all of whom are to serve on an at-will basis until their resignation or removal by the Company’s Board of Directors.

 

 
5
 
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Principal Products, Services and Their Markets

 

As described above in this Part I, Item 1, we have ownership interests in Worx, Amuli and Tieshan Oil.

 

Worx designs automated solutions for industrial, environmental and energy industries to improve efficiency and systems output. The Worx automated robotic tank cleaning system reduces tank cleaning time, reduces or eliminates the need for personnel to enter tanks, and may reduce the volume of solvents used to clean a tank. Actual results vary from tank to tank and may involve variables including the product in the tank, physical condition of the tank such as corrosion, or amount of sludge accumulated. Worx is currently refining its product line to improve speed and efficiency, and our investment in Worx has facilitated this development. We hope to utilize this important technology for deployment into commercial markets in China and greater Asia.

 

Amuli is in development to become a large producer of the health beverage drink Kvass. Amuli has purchased equipment and is currently expanding its production facilities that are forecasted to generate sales and profits in 2018.

 

Tieshan Oil is principally engaged in the trading of oil, gas and lubricant products within the PRC. During the year ended January 31, 2018, one customer accounted for approximately 99% of revenues of Tieshan Oil. During the year ended January 31, 2017, one customer accounted for approximately 49% of revenues of Tieshan Oil. As of January 31, 2018, two customers accounted for approximately 99% of accounts receivable. As of January 31, 2017, two customers accounted for approximately 87% of accounts receivable. The concentrations of credit risk as of January 31, 2018 was higher than that of January 31, 2017.

 

We are also seeking additional global investment opportunities in emerging companies with products that have potential for expanding regional and international sales and revenues.

 

Competitive Business Conditions and Strategy; Resort Savers’ Position in the Industry

 

Barriers to entry in the industry is extremely low and there are many competitors. Our core business is the acquisition of cash-generating businesses, or businesses which we believe will generate cash in the near term, and we primarily use our capital stock as consideration in such acquisitions. Our competitors have significantly greater financial and marketing resources than we do, including sufficient cash to pay consideration for acquisitions. There are no assurances that our efforts to compete in the marketplace will be successful or that we will continue to be able to compete with other funds, companies or other sources of capital to secure competitive acquisition targets and consummate future transactions.

 

Patents, Trademarks, Licenses, Agreements or Contracts

 

There are no aspects of our business plan which require a patent, trademark, or product license. We have not entered into any vendor agreements or contracts that give or could give rise to any obligations or concessions.

 

Research and Development Activities and Costs

 

We have spent no time on specialized research and development activities and have no plans to undertake any research or development in the future.

 

Number of Employees

 

Resort Savers has 10 full-time employees and we do not anticipate hiring more employees in the near future. None of our Officers and/or Directors have signed any employment agreement, or any other agreement containing provisions related to financial remuneration for services, with the Company.

 

 
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Reports to Security Holders

 

The public may read and copy any materials filed with the SEC at the SEC’s Public Reference Room at 100 F Street NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports and other electronic information regarding Resort Savers, Inc. and filed with the SEC at http://www.sec.gov.

 

Emerging Growth Company and Smaller Reporting Company Status

 

Emerging Growth Company

 

We are an “emerging growth company” as defined in Section 2(a)(19) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We intend to take advantage of all of these exemptions.

 

In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards, and delay compliance with new or revised accounting standards until those standards are applicable to private companies. We have elected to take advantage of the benefits of this extended transition period.

 

We could be an emerging growth company until the last day of the first fiscal year following the fifth anniversary of our first common equity offering, although circumstances could cause us to lose that status earlier if our annual revenues exceed $1.07 billion, if we issue more than $1.0 billion in non-convertible debt in any three-year period or if we become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act.

 

Smaller Reporting Company

 

We also qualify as a “smaller reporting company” under Rule 12b-2 of the Exchange Act, which is defined as a company with a public equity float of less than $75 million. To the extent that we remain a smaller reporting company at such time as are no longer an emerging growth company, we will still have reduced disclosure requirements for our public filings, some of which are similar to those of an emerging growth company, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements.

 

Item 1A. Risk Factors

 

As a “smaller reporting company,” we are not required to provide the information required by this Item.

 

 
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Item 1B. Unresolved Staff Comments.

 

None.

 

Item 2. Properties.

 

Resort Savers’ principal business and corporate address is No. 10-2-4B, Jin Di Shang Tang Garden, Long Hua Xin Qu Shang Tang Road, Shenzhen, Guangdong Province, China 518000; the telephone number is 0086-0755-23106825. Other than this mailing address, the Company does not currently maintain any physical or other office facilities, and we do not anticipate the need for maintaining office facilities at any time in the foreseeable future. The Company pays no rent or other fees for the use of the mailing address as this address is used virtually full-time by activities of a shareholder of the Company.

 

We do not currently have any investments or other interests in any real estate, nor do we have investments or an interest in any real estate mortgages or securities of persons engaged in real estate activities.

 

Item 3. Legal Proceedings.

 

We are not involved in any pending legal proceeding nor are we aware of any pending or threatened litigation against us.

 

Item 4. Mine Safety Disclosures.

 

Not applicable.

 

 
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PART II

 

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

 

Market Information

 

Our common stock is not traded on any exchange but is currently available for trading in the over-the-counter market and is quoted on the OTCQB operated by the OTC Markets Group, Inc. under the symbol “RSSV.” Trading in stocks quoted on these markets is often thin and is characterized by wide fluctuations in trading prices due to many factors that may have little to do with a company’s operations or business prospects.

 

Over the counter securities are not listed or traded on the floor of an organized national or regional stock exchange. Instead, these securities transactions are conducted through a telephone and computer network connecting dealers in stocks. Over the counter issuers are traditionally smaller companies that do not meet the financial and other listing requirements of a regional or national stock exchange.

 

Trades in our common stock may be subject to Rule 15g-9 of the Exchange Act, which imposes requirements on broker/dealers who sell securities subject to the rule to persons other than established customers and accredited investors. For transactions covered by the rule, broker/dealers must make a special suitability determination for purchasers of the securities and receive the purchaser’s written agreement to the transaction before the sale.

 

The SEC also has rules that regulate broker/dealer practices in connection with transactions in “penny stocks.” Penny stocks generally are equity securities with a price of less than $5.00 (other than securities listed on certain national exchanges, provided that the current price and volume information with respect to transactions in that security is provided by the applicable exchange or system). The penny stock rules require a broker/dealer, before effecting a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document prepared by the SEC that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker/dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker/dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and offer quotations, and the broker/dealer and salesperson compensation information, must be given to the customer orally or in writing before effecting the transaction, and must be given to the customer in writing before or with the customer’s confirmation. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for shares of our common stock. As a result of these rules, investors may find it difficult to sell their shares.

 

 
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Set forth below are the range of high and low bid quotations for the periods indicated as reported by the OTC Markets Group, since approval for our quotation on April 7, 2014. The market quotations reflect inter-dealer prices, without retail mark-up, mark-down or commissions and may not necessarily represent actual transactions.

 

Quarter Ended

 

High

 

 

Low

 

January 31, 2018

 

$ 0.32

 

 

$ 0.18

 

October 31, 2017

 

$ 0.28

 

 

$ 0.15

 

July 31, 2017

 

$ 0.39

 

 

$ 0.16

 

April 30, 2017

 

$ 0.52

 

 

$ 0.20

 

 

Quarter Ended

 

High

 

 

Low

 

January 31, 2017

 

$ 0.70

 

 

$ 0.50

 

October 31, 2016

 

$ 0.51

 

 

$ 0.32

 

July 31, 2016

 

$ 0.42

 

 

$ 0.23

 

April 30, 2016

 

$ 0.50

 

 

$ 0.23

 

 

Quarter Ended

 

High

 

 

Low

 

January 31, 2016

 

$ 0.67

 

 

$ 0.36

 

October 31, 2015

 

$ 0.83

 

 

$ 0.60

 

July 31, 2015

 

$ 0.83

 

 

$ 0.42

 

April 30, 2015

 

$ 0.73

 

 

$ 0.45

 

 

Quarter Ended

 

High

 

 

Low

 

January 31, 2015

 

$ 0.45

 

 

$ 0.30

 

October 31, 2014

 

$ 0.40

 

 

$ 0.003

 

July 31, 2014

 

$ 0.003

 

 

$ 0.003

 

May 30, 2014

 

$ 0.003

 

 

$ 0.003

 

 

On May 16, 2018, the closing price of our common stock as reported by the OTC Markets was $0.2544 per share.

 

As of May 16, 2018 there were approximately 244 stockholders of record and an aggregate of 74,976,241 shares of our common stock were issued and outstanding.

 

Dividend Policy

 

The Company does not anticipate paying dividends on the common stock at any time in the foreseeable future. The Company’s Board of Directors currently plans to retain any earnings for the development and expansion of the Company’s business. Any future determination as to the payment of dividends will be at the discretion of the Board of Directors of the Company and will depend on a number of factors including future earnings, capital requirements, financial conditions and such other factors as the Board of Directors may deem relevant.

 

Equity Compensation Plan Information

 

We do not have in effect any compensation plans under which our equity securities are authorized for issuance and we do not have any outstanding stock options.

 

Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities

 

The Company did not issue or sell any equity securities during our fiscal year ended January 31, 2018 or the period of time from the end of such fiscal year until the date of filing this Annual Report on Form 10-K. For a description of securities issued as consideration for the acquisition of equity interests in Worx, Amuli and Tieshan Oil, please refer to Part I, Item 1 of this Annual Repport on Form 10-K.

 

 
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Purchase of Equity Securities by the Issuer and Affiliated Purchasers

 

We did not purchase any of our shares of common stock or other securities during our fiscal year ended January 31, 2018.

 

Description of Securities and Certain Rights of Holders of Common Stock

 

Our authorized capital stock consists of 1,000,000,000 shares of common stock, par value $0.0001 per share, and 15,000,000 shares of preferred stock, par value $0.0001. As of May 16, 2018, 74,976,241 shares of common stock, held by approximately 244 stockholders, were issued and outstanding. Holders of our common stock are entitled to one vote for each share on all matters submitted to a stockholder vote.

 

Holders of our common stock:

 

·

have equal ratable rights to dividends from funds legally available, therefore, when, as and if declared by our Board,

·

are entitled to share in all of our assets available for distribution to holders of common stock upon liquidation, dissolution or winding up of our affairs, and

·

do not have preemptive, subscription or conversion rights, and there are no redemption or sinking fund provisions or rights.

 

Holders of shares of our common stock do not have cumulative voting rights, meaning that the holders of the majority of the outstanding shares, voting for the election of Directors, can elect all of the Directors to be elected, and, in such event, the holders of the remaining shares will not be able to elect any of our Directors.

 

Historically, we have not paid any cash dividends to stockholders. The declaration of any future cash dividend will be at the discretion of our Board and will depend upon our earnings, if any, our capital requirements and financial position, our general economic conditions, and other pertinent conditions. It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any, in our business operations.

 

Item 6. Selected Financial Data.

 

As a “smaller reporting company,” we are not required to provide the information required by this Item.

 

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

 

Overview

 

For an overview of the business of the Company, including acquisitions of equity securities of Worx, Amuli and Tieshan Oil, the planned acquisition of Admall, changes to management and the Company’s articles of incorporation, please refer within this Annual Report on Form 10-K to Part I, Item 1 (“Business”).

 

Results of Operations

 

We have generated revenues of $39,612,503 and have incurred $39,989,812 in expenses through the year ended January 31, 2018.

 

The following table provides selected financial data about our company as at January 31, 2018 and 2017.

   

 
11
 
Table of Contents

 

Balance sheet Data:

 

 

 

January 31,

 

 

January 31,

 

 

 

2018

 

 

2017

 

Cash

 

$ 44,681

 

 

$ 51,208

 

Total Assets

 

$ 26,505,552

 

 

$ 71,966,505

 

Total Liabilities

 

$ 20,088,815

 

 

$ 65,671,481

 

Stockholders’ Equity 

 

$ 6,416,737

 

 

$ 6,295,024

 

 

As at January 31, 2018, our current assets were $24,515,185 and our current liabilities were $20,088,815, which resulted in working capital of $4,426,370. As at January 31, 2018, current assets were comprised of $44,681 in cash, $22,820,925 in accounts receivable, $46,315 in prepaid expenses and deposits, $1,567,238 in due from related parties and $36,026 in other receivables as compared to $51,208 in cash, $43,054,811 in accounts receivable, $20,502 in prepaid expenses and deposits, $26,747,696 in due from related parties and $10,670 in other receivables at January 31, 2017. At January 31, 2018, current liabilities were comprised of $1,229,442 in accounts payable, $795,000 in short-term loans, $17,744,987 in amounts due to related parties, $266,857 in deferred revenue, $6,476 in tax payable, and $46,053 in other payables as compared to $1,046,628 in accounts payable, $1,046,160 in short-term loans, $63,555,421 in amounts due to related parties, $9,289 in tax payable, and $13,983 in other payables at January 31, 2017. Stockholders’ equity was $6,416,737 as of January 31, 2018, as compared to $6,295,024 as of January 31, 2017.

 

The following summary of our results of operations, for the years ended January 31, 2018 and 2017, should be read in conjunction with our financial statements, as included in this annual report on Form 10-K.

 

 

 

Year Ended

 

 

 

 

 

 

 

 

 

January 31,

 

 

Change

 

 

 

2018

 

 

2017

 

 

Amount

 

 

%

 

Revenue

 

$ 39,612,503

 

 

$ 94,798,849

 

 

$ (55,186,346 )

 

(58

%)

Cost of Goods Sold

 

$ 39,349,598

 

 

$ 94,247,019

 

 

$ (54,897,421 )

 

(58

%)

Gross Profit

 

$ 262,905

 

 

$ 551,830

 

 

$ (288,925 )

 

(52

%)

Operating expenses

 

$ 576,316

 

 

$ 750,114

 

 

$ (173,798 )

 

(23

%)

Other income (expense)

 

$ 63,898

 

 

$ 1,934,038

 

 

$ (1,870,140 )

 

(97

%)

Net loss

 

$ 383,330

 

 

$ 2,137,776

 

 

$ (1,754,446 )

 

(82

%)

 

Revenues

 

We generated revenues of $39,612,503 and $94,798,849 during the years ended January 31, 2018 and 2017, respectively. The decrease in revenue was due to strong competition in the marketing.

 

Cost of Goods Sold

 

We incurred cost of goods sold of $39,349,598 and $94,247,019 during the years ended January 31, 2018 and 2017, respectively. The decrease in cost of goods sold was due to corresponding purchased cost reduction.

 

Operating Expenses

 

Operating expenses for the year ended January 31, 2018, decreased to $576,316 by $173,798 from $750,114 for the year ended January 31, 2017. The decrease in expenses can be attributed to general and administrative expenses. The decrease in general and administrative expenses was primarily related to reduced sales activities. 

 

Other income (expense)

 

During the year ended January 31, 2018 and 2017, the Company recognized other income of $0 and $77,528, respectively.

 

Other expenses for the year ended January 31, 2018 were $63,898 as compared to $2,011,566 for the year ended January 31, 2017. The other expenses for the year ended January 31, 2018 can be attributed to $63,224 in interest expense and $674 in other expenses. The other expenses for the year ended January 31, 2017 can be attributed to $1,907,308 in impairment loss on investment, $100,300 in interest expense and $3,958 in other expenses.

 

 
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Table of Contents

 

Net Loss

 

Net losses for the year ended January 31, 2018, decreased to $383,330 by $1,754,446 from $2,137,776 for the year ended January 31, 2017. The decrease in net losses can be attributed to the impairment loss of investment of $1,907,308.

 

Liquidity and Financial Condition

 

Working Capital

 

 

 

January 31,

 

 

January 31,

 

 

Change

 

 

 

2018

 

 

2017

 

 

Amount

 

 

%

 

Current Assets

 

$ 24,515,185

 

 

$ 69,884,887

 

 

$ (45,369,702 )

 

(65

%)

Current Liabilities

 

$ 20,088,815

 

 

$ 65,671,481

 

 

$ (45,582,666 )

 

(69

%)

Working Capital

 

$ 4,426,370

 

 

$ 4,213,406

 

 

$ 212,964

 

 

 

5 %

 

Working capital was relatively unchanged as of January 31, 2018 as compared to January 31, 2017, however as at January 31, 2018, our current assets and current liabilities decreased 65% and 69%, respectively, as compared to 2017. The decrease in current assets at 2018 was primarily due to a decrease in accounts receivable of $20,233,886 to $22,820,925 and a decreased in due from related parties by of $25,180,458 to $1,567,238. The decreases are attributable to reduced sales activity. The decrease in current liabilities at 2018 was primarily due to a decrease in due to related parties of $45,810,434 to $17,744,987, as a result of reduced trading and purchasing activities.

 

Cash Flows

 

 

 

Year Ended

 

 

 

 

 

 

 

 

January 31,

 

 

Change

 

 

 

2018

 

 

2017

 

 

Amount

 

 

%

 

Cash Flows provided by (used in) operating activities

 

$ (2,119,196 )

 

$ 1,910,556

 

 

$ (4,029,752 )

 

(211

%)

Cash Flows used in investing activities

 

$ -

 

 

$ -

 

 

$ -

 

 

 

-

 

Cash Flows used in financing activities

 

$ (286,771 )

 

$ (1,899,998 )

 

$ 1,613,227

 

 

(85

%)

Effects on changes in foreign exchange rate

 

$ 2,399,440

 

 

$ (185,988 )

 

$ 2,585,428

 

 

(1,390

%)

Net decrease in cash during period

 

$ (6,527 )

 

$ (175,430 )

 

$ 181,957

 

 

(104

%)

 

Cash Flow from Operating Activities

 

During the year ended January 31, 2018, our company used $2,119,196 in cash from operating activities compared to $1,910,556 of cash provided by operating activities during the year ended January 31, 2017. The decrease in cash from operating activities was primarily attributed to a decrease in amount due to related parties of $48,435,404, partially offset by decrease in amount due from related party of $25,942,722, decrease in accounts receivable of $20,233,886.

 

Cash Flow from Investing Activities

 

During the year ended January 31, 2018 and 2017, we did not use any cash for investing activities.

 

 
13
 
Table of Contents

 

Cash Flow from Financing Activities

   

During the year ended January 31, 2018, our company used $286,771 in cash in financing activities, consisting of $116,704 in loans from related parties, $322,520 in payment of short-term loan and $80,955 in repayments of loans from related parties, compared to cash used in financing activities of $1,899,998 for the year ended January 31, 2017, consisting of $96,899 in loans from related parties, $1,046,160 in proceeds from short-term loan, $2,993,364 in payment of short-term loan and $49,693 in repayments of loans from related parties.

   

Plan of Operation

 

Since the inception of the Company, we have incurred significant losses and relied upon capital raised from affiliates and third parties. The Company makes investments and acquisitions into sound, transparent markets and industries throughout the world. In China, the Company has invested in companies with innovative and market-ready petroleum industry technologies for potential installation and distribution throughout the Greater China market.

 

Amuli has purchased equipment and is currently expanding its production facilities that are forecasted to generate sales and profits in 2017. In light of our investments in Worx and acquisitions of Tieshan Oil and Amuli, we anticipate generating revenues from the operations of such entities during the next 12 months. We also anticipate closing the Admall Acquisition by the end of the first fiscal quarter in 2018. Notwithstanding, in light of our ongoing expenses, our management cannot provide any assurances that such revenue will be sufficient to cover all of our expenses or that our Company will ever operate profitably.

 

During the next year of operations, our officers and Directors will also provide their labor at no charge. We have hired 10 staff and do not anticipate hiring any more staff in the next 12 months of operation.

 

We are a public entity, subject to the reporting requirements of the Exchange Act. We will incur ongoing expenses associated with professional fees for accounting, legal and a host of other expenses for annual reports and proxy statements. We estimate that these accounting, legal and other professional costs would be a minimum of $250,000 in the next year and will be higher, in the following years, if our business volume and activity increases. Increased business activity could greatly increase our professional fees for reporting requirements and this could have a significant impact on future operating costs. The difference between having the ability to sustain our cash flow requirements over the next twelve months and the need for additional outside funding will depend on how fast we can generate sales revenue.

 

Limited Operating History; Need for Additional Capital

 

We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to the price and cost increases in supplies and services.

 

If we are unable to meet our needs for cash from either our operations, or possible alternative sources, then we may be unable to continue, develop, or expand our operations.

 

Off-Balance Sheet Arrangements

 

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

 

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

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.

 

 
14
 
Table of Contents

 

Item 8. Financial Statements and Supplementary Data.

 

RESORT SAVERS, INC.

 

INDEX TO THE AUDITED FINANCIAL STATEMENTS

 

Years ended January 31, 2018 and 2017

 

TABLE OF CONTENTS

 

 

Page

 

 

 

 

 

 

Report of Independent Registered Public Accounting Firm

 

16

 

Consolidated Balance Sheets

 

17

 

Consolidated Statements of Operations and Other Comprehensive Income (Loss)

 

18

 

Consolidated Statements of Stockholders’ Equity

 

19

 

Consolidated Statements of Cash Flows

 

20

 

Notes to the Consolidated Financial Statements

 

21

 

15
 

 

REPORT OF REGISTERED INDEPENDENT PUBLIC ACCOUNTING FIRM

 

To: The Board of Directors and Stockholders of

Resort Savers, Inc.

 

Opinion on the Financial Statements

 

We have audited the accompanying balance sheets of Resort Savers, Inc. (the “Company”) as of January 31, 2018 and 2017, and the related statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the two year ended January 31, 2018, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of January 31, 2018 and 2017, and the results of its operations and its cash flows for each of the years in the two-year period ended January 31, 2018 and 2017, in conformity with accounting principles generally accepted in the United States of America.

 

Emphasis of Matter

 

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 had incurred substantial losses in previous years and has a working capital deficit, which raises substantial doubt about its ability to continue as a going concern. Management’s plans in regards to these matters are also described in Note 3. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Basis for Opinion

 

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, 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.

 

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

 

 

/s/ WWC, P.C.

San Mateo, CA

 

WWC, P.C.

May 16, 2018

 

Certified Public Accountants

 

We have served as the Company’s auditor since December 6, 2017.

 

16
 
Table of Contents

 

RESORT SAVERS, INC.

Consolidated Balance Sheets

 

 

 

January 31,

 

 

January 31,

 

 

 

2018

 

 

2017

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash and cash equivalents

 

$ 44,681

 

 

$ 51,208

 

Accounts receivable

 

 

22,820,925

 

 

 

43,054,811

 

Other receivable

 

 

36,026

 

 

 

10,670

 

Prepaid expenses and deposits

 

 

46,315

 

 

 

20,502

 

Amount due from related parties

 

 

1,567,238

 

 

 

26,747,696

 

Total Current Assets

 

 

24,515,185

 

 

 

69,884,887

 

Equipment, net

 

 

10,580

 

 

 

101,831

 

Goodwill

 

 

1,979,787

 

 

 

1,979,787

 

TOTAL ASSETS

 

$ 26,505,552

 

 

$ 71,966,505

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$ 1,229,442

 

 

$ 1,046,628

 

Short-term loan

 

 

795,000

 

 

 

1,046,160

 

Deferred revenue

 

 

266,857

 

 

 

-

 

Due to related parties

 

 

17,744,987

 

 

 

63,555,421

 

Tax payable

 

 

6,476

 

 

 

9,289

 

Other current payable

 

 

46,053

 

 

 

13,983

 

Total Current Liabilities

 

 

20,088,815

 

 

 

65,671,481

 

TOTAL LIABILITIES

 

 

20,088,815

 

 

 

65,671,481

 

 

 

 

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Preferred stock, $0.0001 par value; 15,000,000 shares authorized; no shares issued and outstanding

 

 

-

 

 

 

-

 

Common stock, $0.0001 par value; 1,000,000,000 shares authorized; 74,976,241 shares issued and outstanding

 

 

7,498

 

 

 

7,498

 

Additional paid-in capital

 

 

8,265,821

 

 

 

8,154,755

 

Accumulated deficit

 

 

(5,142,944 )

 

 

(4,821,956 )

Accumulated other comprehensive loss

 

 

67,424

 

 

 

(130,108 )

Total Resort Savers, Inc. stockholders' equity

 

 

3,197,799

 

 

 

3,210,189

 

Non-controlling interest

 

 

3,218,938

 

 

 

3,084,835

 

Total equity

 

 

6,416,737

 

 

 

6,295,024

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$ 26,505,552

 

 

$ 71,966,505

 

 

The notes are an integral part of these financial statements.

 

17
 
Table of Contents

 

RESORT SAVERS, INC.

Consolidated Statements of Operations and Other Comprehensive Income

 

 

 

Year Ended

 

 

 

January 31,

 

 

 

2018

 

 

2017

 

 

 

 

 

 

 

 

Revenue

 

$ 39,612,503

 

 

$ 94,798,849

 

Cost of goods sold

 

 

39,349,598

 

 

 

94,247,019

 

Gross Profit

 

 

262,905

 

 

 

551,830

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

General and administrative

 

 

372,491

 

 

 

664,343

 

Professional fees

 

 

203,825

 

 

 

85,771

 

Total Operating Expenses

 

 

576,316

 

 

 

750,114

 

 

 

 

 

 

 

 

 

 

Loss From Operations

 

 

(313,411 )

 

 

(198,284 )

 

 

 

 

 

 

 

 

 

Other Income

 

 

 

 

 

 

 

 

Other income

 

 

-

 

 

 

77,528

 

 

 

 

 

 

 

 

 

 

Other Expense

 

 

 

 

 

 

 

 

Impairment loss of investment

 

 

-

 

 

 

(1,907,308 )

Other loss

 

 

(674 )

 

 

(3,958 )

Interest expense

 

 

(63,224 )

 

 

(100,300 )

Total Other Expenses

 

 

(63,898 )

 

 

(2,011,566 )

 

 

 

 

 

 

 

 

 

Loss Before Income Taxes

 

 

(377,309 )

 

 

(2,132,322 )

Provision for income taxes

 

 

(6,021 )

 

 

(5,454 )

 

 

 

 

 

 

 

 

 

Net Loss

 

 

(383,330 )

 

 

(2,137,776 )

Net (income) loss attributable to the non-controlling interest

 

 

62,342

 

 

 

79,883

 

Net Loss Attributable To The Shareholders Of Resort Savers, Inc.

 

$ (320,988 )

 

$ (2,057,893 )

 

 

 

 

 

 

 

 

 

Other Comprehensive Income (Loss)

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

$ 393,977

 

 

$ (258,177 )

Total Comprehensive Income (Loss)

 

 

10,647

 

 

 

(2,395,953 )

Comprehensive (income) loss attributable to the non-controlling interest

 

 

(134,103 )

 

 

207,536

 

Total Comprehensive Loss Attributable To The Shareholders Of Resort Savers, Inc.

 

$ (123,456 )

 

$ (2,188,417 )

 

 

 

 

 

 

 

 

 

Basic and Diluted Loss per Common Share

 

$ (0.00 )

 

$ (0.03 )

Basic and Diluted Weighted Average Common Shares Outstanding

 

 

74,976,241

 

 

 

74,976,241

 

 

The notes are an integral part of these financial statements.

 

18
 
Table of Contents

 

RESORT SAVERS, INC.

Consolidated Statements of Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

Contingently

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Contingently

Issuable

 

 

Liability on Issuable

 

 

Additional

 

 

 

 

Accumulated

Other

 

 

Non

 

 

Total

 

 

 

Number

of Shares

 

 

Amount

 

 

Common Stock

 

 

Common Stock

 

 

Paid-in

Capital

 

 

Accumulated

Deficit

 

 

Comprehensive

Income

 

 

controlling

Interest

 

 

Stockholders'

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - January 31, 2016

 

 

74,976,241

 

 

 

7,498

 

 

 

120

 

 

 

687,000

 

 

 

7,320,287

 

 

 

(2,764,063 )

 

 

416

 

 

 

3,292,371

 

 

 

8,543,629

 

Cancellation of contingently issuable common share for investment of Tieshan Oil

 

 

-

 

 

 

-

 

 

 

(120 )

 

 

(687,000 )

 

 

687,120

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Debt forgiven by related parties

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

147,348

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

147,348

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,057,893 )

 

 

-

 

 

 

(79,883 )

 

 

(2,137,776 )

Other comprehensive income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(130,524 )

 

 

(127,653 )

 

 

(258,177 )

Balance - January 31, 2017

 

 

74,976,241

 

 

$ 7,498

 

 

$ -

 

 

$ -

 

 

$ 8,154,755

 

 

$ (4,821,956 )

 

$ (130,108 )

 

$ 3,084,835

 

 

$ 6,295,024

 

Debt forgiven by related parties

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

111,066

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

111,066

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(320,988 )

 

 

-

 

 

 

(62,342 )

 

 

(383,330 )

Other comprehensive income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

197,532

 

 

 

196,445

 

 

 

393,977

 

Balance - January 31, 2018

 

 

74,976,241

 

 

$ 7,498

 

 

$ -

 

 

$ -

 

 

$ 8,265,821

 

 

$ (5,142,944 )

 

$ 67,424

 

 

$ 3,218,938

 

 

$ 6,416,737

 

 

The notes are an integral part of these financial statements.

 

19
 
Table of Contents

 

RESORT SAVERS, INC.

Consolidated Statements of Cash Flows

 

 

 

Year Ended

 

 

 

January 31,

 

 

 

2018

 

 

2017

 

 

 

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

Net loss

 

$ (383,330 )

 

$ (2,137,776 )

Adjustments to reconcile net loss to net cash from operating activities:

 

 

 

 

 

 

 

 

Depreciation

 

 

95,171

 

 

 

102,262

 

Impairment loss of investment

 

 

-

 

 

 

1,907,308

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Amount due from related party

 

 

25,942,722

 

 

 

(13,287,456 )

Accounts receivable

 

 

20,233,886

 

 

 

(31,467,241 )

Other receivable

 

 

(25,356 )

 

 

(6,541 )

Prepaid expenses and deposits

 

 

(25,813 )

 

 

1,657,959

 

Accounts payable

 

 

182,814

 

 

 

(4,641,908 )

Deferred revenue

 

 

266,857

 

 

 

-

 

Amount due to related party

 

 

(48,435,404 )

 

 

63,270,068

 

Deposits received

 

 

-

 

 

 

(13,496,941 )

Tax payable

 

 

(2,813 )

 

 

(1,874 )

Other payable

 

 

32,070

 

 

 

12,696

 

Net cash provided by (used in) operating activities

 

 

(2,119,196 )

 

 

1,910,556

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

Repayments of short-term loan

 

 

(322,520 )

 

 

(2,993,364 )

Proceeds from short-term loan

 

 

-

 

 

 

1,046,160

 

Loans from related parties

 

 

116,704

 

 

 

96,899

 

Repayments of loans from related parties

 

 

(80,955 )

 

 

(49,693 )

Net cash provided by (used in) financing activities

 

 

(286,771 )

 

 

(1,899,998 )

 

 

 

 

 

 

 

 

 

Effects on changes in foreign exchange rate

 

 

2,399,440

 

 

 

(185,988 )

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

 

(6,527 )

 

 

(175,430 )

Cash and cash equivalents - beginning of period

 

 

51,208

 

 

 

226,638

 

Cash and cash equivalents - end of period

 

$ 44,681

 

 

$ 51,208

 

 

 

 

 

 

 

 

 

 

Supplemental Cash Flow Disclosures

 

 

 

 

 

 

 

 

Cash paid for interest

 

$ -

 

 

$ 100,300

 

Cash paid for income taxes

 

$ -

 

 

$ -

 

 

 

 

 

 

 

 

 

 

Non-Cash Investing and Financing Activity:

 

 

 

 

 

 

 

 

Related party debt forgiven

 

$ 111,066

 

 

$ 147,348

 

Cancellation of contingently issuable common share for investment of Tieshan Oil

 

$ -

 

 

$ 687,120

 

  

The notes are an integral part of these financial statements.

 

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RESORT SAVERS, INC.

Notes to the Consolidated Financial Statements

January 31, 2018 and 2017

 

NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

 

Resort Savers, Inc. (the “Company”) is a Nevada corporation incorporated on June 25, 2012. It is based in Shenzhen, the People’s Republic of China (the “PRC”). The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is January 31.

 

The Company makes investments and acquisitions into sound, transparent markets and industries throughout the world. The Company has invested in a company principally engaged in the development and production of beverages, investment in agricultural business and import and export of products in the food and beverage industry, and a company principally engaged in the trading of oil, gas and lubricant. In Europe and worldwide, the Company is seeking to acquire and invest in global tourist and development assets that can be tailored to Chinese and American investment traveler.

 

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The Financial Statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The Financial Statements have been prepared using the accrual basis of accounting in accordance with Generally Accepted Accounting Principles (“GAAP”) of the United States and presented in US dollars.

 

Principles of Consolidation

 

At January 31, 2017, the principal subsidiaries of the Company were listed as follows:

 

Entity Name

 

Acquisition

Date

 

Ownership

 

Jurisdiction

 

Investments

Held By

 

Nature of

Operation

 

Fiscal

Year

 

Xing Rui International Investment Holding Group Co., Ltd. (“Xing Rui”)

 

December 22, 2014

 

100

%

 

Seychelles

 

Resort Savers

 

Holding Company

 

January 31,

 

Xing Rui International Investment Group Ltd. (“Xin Rui HK”)

 

December 22, 2014

 

100

%

 

Hong Kong, the PRC

 

Xing Rui

 

Holding Company

 

January 31,

 

Huaxin Changrong (Shenzhen) Technology Service Co., Ltd. (“Huaxin”) *

 

August 27, 2015

 

100

%

 

the PRC

 

Xing Rui

 

Holding Company

 

December 31,

 

Shenzhen Amuli Industrial Development Company Limited (“Amuli”) *

 

October 1, 2015

 

60

%

 

the PRC

 

Huaxin

 

Beverage Producer

 

December 31

 

Beijing Yandong Tieshan Oil Products Co., Ltd. (“Tieshan Oil”) *

 

January 29, 2016

 

51

%

 

the PRC

 

Huaxin

 

Trading of oil products

 

December 31,

________

*

The English names used are translated only.

 

These consolidated financial statements include the accounts of the Company and its subsidiaries. All material intercompany balances and transactions have been eliminated.

 

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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. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ from these good faith estimates and judgments.

 

Foreign Currency Translation and Re-measurement

 

The Company translates its foreign operations to U.S. dollar in accordance with ASC 830, “Foreign Currency Matters”.

 

The Company’s functional currency and reporting currency is the U.S. dollar, subsidiaries’ functional currency is the Chinese Yuan Renminbi (“CNY”) and Hong Kong Dollar (“HKD”).

 

The Company’s subsidiaries, whose records are not maintained in that company’s functional currency, re-measure their records into their functional currency as follows:

 

 

· Monetary assets and liabilities at exchange rates in effect at the end of each period

 

 

 

 

· Nonmonetary assets and liabilities at historical rates

 

 

 

 

· Revenue and expense items at the average rate of exchange prevailing during the period

 

Gains and losses from these re-measurements were not significant and have been included in the Company’s results of operations.

 

The Company’s subsidiaries, whose functional currency is not the U.S. dollar, translate their records into U.S. dollar as follows:

 

 

· Assets and liabilities at the rate of exchange in effect at the balance sheet date

 

 

 

 

· Equities at historical rate

 

 

 

 

· Revenue and expense items at the average rate of exchange prevailing during the period

 

Adjustments arising from such translations are included in accumulated other comprehensive income in shareholders’ equity.

 

 

 

January 31,

 

 

January 31,

 

 

 

2018

 

 

2017

 

 

 

 

 

 

 

 

Spot RMB: USD exchange rate

 

$ 0.1590

 

 

$ 0.1453

 

Average RMB: USD exchange rate

 

$

0.1452-0.1528

 

 

$

0.1452-0.1536

 

Spot HKD: USD exchange rate

 

$ 0.129

 

 

$ 0.129

 

Average HKD: USD exchange rate

 

$ 0.129

 

 

$ 0.129

 

 

Cash and Cash Equivalents

 

Cash and cash equivalents include cash in banks, money market funds, and certificates of term deposits with maturities of less than three months from inception, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value. The Company had $44,681 and $51,208 in cash and cash equivalents as at January 31, 2018 and 2017, respectively.

 

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Accounts receivable

 

The Company maintains reserves for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. Reserves are recorded primarily on a specific identification basis.

 

The standard credit period for most of the Company’s clients is three months. The collection period over 1 year is classified as long-term accounts receivable. Management evaluates the collectability of the receivables at least once a year. Provision for doubtful accounts as of January 31, 2018 and 2017 are $0.

 

Concentrations of Credit Risk

 

The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents, and accounts receivable. The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company also review its accounts receivable on a timely manner. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.

 

Tieshan Oil

 

During the year ended January 31, 2018, one customer accounted for approximately 99% of revenues of Tieshan Oil. During the year ended January 31, 2017, one customer accounted for approximately 49% of revenues of Tieshan Oil.

 

As of January 31, 2018, two customers accounted for approximately 99% of accounts receivable. As of January 31, 2017, two customers accounted for approximately 87% of accounts receivable. The concentrations of credit risk as of January 31, 2018 was higher than that of January 31, 2017.

 

Financial Instruments

 

The Company follows ASC 820, “Fair Value Measurements and Disclosures”, which defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3).

 

The three levels of the fair value hierarchy are described below:

 

Level 1

 

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

 

Level 2

 

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

 

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Level 3

 

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

 

Property, plant and equipment

 

Property, plant and equipment are recorded at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the term of the related lease or the estimated useful life of the asset. The useful lives are as follows:

 

Machinery

5 ~ 10 years

 

Maintenance and repairs are charged to operations as incurred. Expenditures which substantially increase the useful lives of the related assets are capitalized. When properties are disposed of, the related costs and accumulated depreciation are removed from the accounts and any gain or loss is reported in the period the transaction takes place.

 

Accounting for the impairment of long-lived assets

 

The long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. It is reasonably possible that these assets could become impaired as a result of technology or other industry changes. Determination of recoverability of assets to be held and used is by comparing the carrying amount of an asset to future net undiscounted cash flows to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. During the years ended January 31, 2018 and 2017, the Company did not impair any long-lived assets except goodwill on Amuli mentioned above.

 

Related Party

 

The Company follows ASC 850, ”Related Party Disclosures,” for the identification of related parties and disclosure of related party transactions.

 

Revenue Recognition

 

The Company will recognize revenue from the sale of products and services in accordance with ASC 605, “Revenue Recognition.” Revenue will be recognized only when all of the following criteria are met: persuasive evidence for an agreement exists, delivery has occurred or services have been provided, the price or fee is fixed or determinable, and collection is reasonably assured.

 

Deferred Income Taxes and Valuation Allowance

 

The Company accounts for income taxes under ASC 740, ”Income Taxes.” Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements 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 the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations. No deferred tax assets or liabilities were recognized as at January 31, 2018 and 2017.

 

Net Loss Per Share of Common Stock

 

The Company has adopted ASC Topic 260, ”Earnings per Share,” (“EPS”) which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying financial statements, basic earnings (loss) per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.

 

The Company has no potentially dilutive securities, such as options or warrants, currently issued and outstanding.

 

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Commitments and Contingencies

 

The Company follows ASC 450-20, "Loss Contingencies," to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. 

 

Recent Accounting Pronouncements

 

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)”, which supersedes nearly all existing revenue recognition guidance under accounting principles generally accepted in the United States of America. The core principle of this ASU is that revenue should be recognized for the amount of consideration expected to be received for promised goods or services transferred to customers. This ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments, and assets recognized for costs incurred to obtain or fulfill a contract. ASU 2014-09 was schedule to be effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. In August 2015, the FASB issued ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of Effective Date,” which deferred the effective date of ASU 2014-09 by one year and allowed entities to early adopt, but no earlier than the original effective date. ASU 2014-09 is now effective for public business entities for the annual reporting period beginning January 1, 2018. This update allows for either full retrospective or modified retrospective adoption. In April 2016, the FASB issued ASU 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing,” which amends guidance previously issued on these matters in ASU 2014-09. The effective date and transition requirements of ASU 2016-10 are the same as those for ASU 2014-09. In May 2016, the FASB issued ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow Scope Improvements and Practical Expedients,” which clarifies certain aspects of the guidance, including assessment of collectability, treatment of sales taxes and contract modifications, and providing certain technical corrections. The effective date and transition requirements of ASU 2016-12 are the same as those for ASU 2014-09.

 

The Company will adopt the new guidance as of January 1, 2018. The Company has evaluated the new guidance and the adoption is not expected to have a significant impact on the Company's financial statements and a cumulative effect adjustment under the modified retrospective method of adoption will not be necessary. There will be no change to the Company’s accounting policies.

 

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)” (“ASU 2016-02”) which supersedes existing guidance on accounting for leases in “Leases (Topic 840).” The standard requires lessees to recognize the assets and liabilities that arise from leases on the balance sheet. A lessee should recognize in the balance sheet a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. The new guidance is effective for annual reporting periods beginning after December 15, 2018 and interim periods within those fiscal years. The amendments should be applied at the beginning of the earliest period presented using a modified retrospective approach with earlier application permitted as of the beginning of an interim or annual reporting period. The Company is currently evaluating the effects of adopting ASU 2016-02 on its consolidated financial statements but the adoption is not expected to have a significant impact on the Company’s consolidated financial statements as of the date of the filing of this report.

 

Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.

 

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NOTE 3 - GOING CONCERN

 

The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet had sufficient revenues to cover its operating cost, and requires additional capital to commence its operating plan. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to continue as a going concern.

 

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan to obtain such resources for the Company include: sales of equity instruments; traditional financing, such as loans; and obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.

 

There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

NOTE 4 – ACCOUNTS RECEIVABLE

 

The Company has performed an analysis on all of its accounts receivable and determined that all amounts are collectible by the Company. As such, all accounts receivable are reflected as a current asset and no allowance for bad debt has been recorded as of January 31, 2018 and 2017. No bad debts were written off for the year ended January 31, 2018 and 2017. The Company’s accounts receivable consists only trade receivables from customers which are unrelated to the Company. Trade receivables from customers which are related to the Company are categorized in amount due from related parties (Note 14). As at January 31, 2018 and 2017, the Company had accounts receivable of $22,820,925 and $43,054,811, respectively.

 

Aging analysis of accounts receivable is as follows:

 

 

 

January 31,

 

 

January 31,

 

 

 

2018

 

 

2017

 

0 - 30 days

 

$ 16,761,646

 

 

$ -

 

30 - 60 days

 

 

-

 

 

 

20,760,211

 

Within 1 year

 

 

-

 

 

 

5,607,879

 

Over 1 year

 

 

6,059,279

 

 

 

16,686,721

 

 

 

$ 22,820,925

 

 

$ 43,054,811

 

 

NOTE 5 – EQUIPMENT

 

Property and equipment at January 31, 2018 and 2017 consist of the following:

 

 

 

January 31,

 

 

January 31,

 

 

 

2018

 

 

2017

 

Cost:

 

 

 

 

 

 

Machinery

 

$ 259,241

 

 

$ 236,855

 

Less: accumulated depreciation

 

 

(248,661 )

 

 

(135,024 )

Equipment, net

 

$ 10,580

 

 

$ 101,831

 

 

During the years ended January 31, 2018 and 2017, the Company recorded depreciation of $95,171 and $102,262, respectively.

 

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NOTE 6 - INVESTMENT

 

On December 30, 2014, a stock purchase agreement was concluded between Worx America, Inc.(“Worx”), and Xing Rui, giving RSSV 20% common equity interest in Worx, a Houston, TX based Research and Development Company. The acquisition was closed on March 20, 2015.

 

This investment was accounted for under equity method initially with cost of $2,000,000. During March 20, 2015 to April 30, 2015, the Company recognized $30,692 loss from its investment in Worx based on its proportionate share of Worx’s net loss during March 20, 2015 to April 30, 2015. The Company also had a proportionate unrealized loss from Worx’s investment held for sale of $62,000, as indicated in the statement of other comprehensive income. On May 1, 2015, the Company lost significant influence on Worx. Therefore, equity method was suspended and the cost method was applied. Accordingly, the $62,000 unrealized loss was removed from accumulated other comprehensive income and realized as equity loss on unconsolidated affiliate investment on May 1, 2015.

 

During the year ended October 31, 2016, the Company did not receive any investment income from Worx.

 

On June 6, 2016, Worx sold all of its assets (“Asset Sale”), including, but not limited to, its technologies and intellectual property, to Bay WorxRail, LLC (“Bay WorxRail”) for $1,000,000 (“Purchase Price”), subject to a holdback of $250,000 of the Purchase Price, pursuant to the terms set forth in that certain Asset Purchase Agreement, dated June 6, 2016, among Worx, Bay WorxRail, and Michael Zilai, as majority stockholder of Worx. The Company reviewed Worx’s financial condition at July 31, 2016 and concluded that as a result of the Asset Sale there is a 100% impairment loss related to the Company’s investment in Worx, and recorded an impairment loss of $1,907,308, for the year ended January 31, 2017. As at January 31, 2018 and 2017, the Company’s carrying value of its Worx investment was $0 and $0, respectively.

 

NOTE 7 – ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

 

The Company’s accounts payable and accrued liabilities consist of the followings:

 

 

 

January 31,

 

 

January 31,

 

 

 

2018

 

 

2017

 

Accounts payable (to third party suppliers)

 

$ 1,128,965

 

 

$ 1,002,579

 

Accrued expenses (to third party service providers)

 

 

100,000

 

 

 

40,954

 

Payroll payable

 

 

477

 

 

 

3,095

 

 

 

$ 1,229,442

 

 

$ 1,046,628

 

 

NOTE 8 – SHORT-TERM LOAN

 

There are no provisions in the Company’s bank borrowings that would accelerate repayment of debt as a result of a change in credit ratings or a material adverse change in the Company’s business.

 

The Industrial and Commercial Bank of China is the lender of the loan. The interest rate is the interbank offered rate announced by the PRC authority on the business day just before the release of the loan, plus 51 basis point, which is 5.06% per annum. The term of borrowing is 1 year, which was renewed as at December 31, 2015. The amount is denominated in Renminbi of RMB20,000,000. The loan is secured by the personal guarantee of one of the shareholders, Yang Baojin, and of his wife in an unlimited amount.

 

25% of the principal of the loan is to be repaid in the eleventh month of the term. The remaining is to be repaid on the maturity of the loan. The loan agreement contains provisions requiring payment of default interest in the event of default, and without specific financial covenants. Management of the Company believes the Company is in material compliance with the terms of the loan agreement.

 

During the year ended January 31, 2017, the Company fully repaid the loan of $3,080,000 (RMB 20,000,000). The Company also borrowed a loan from a money provider. The amount is denominated in Renminbi of RMB7,200,000. The interest rate is 0.5% per month. The loan is secured by 48.83% shares of Tieshan Oil held by Yang Baojin. The Loan was due on October 7, 2017 and is currently in default. The Company believes that the carrying value of the equity interest in Tieshan Oil, which is a financial instrument, and which has been pledged by Mr. Yang Baojin as collateral for the loan is sufficient to underlie the loan, and the Company has not been requested to add any additional credit enhancements.

 

During the year ended January 31, 2018 and 2017, the Company the Company repaid loan of $322,520 and $2,993,364 and incurred interest of $63,244 and $100,300, respectively. On January 31, 2018 and 2017, the Company had a short-term loan balance of $795,000 and 1,046,160, respectively.

 

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NOTE 9 - STOCKHOLDERS’ EQUITY

 

The capitalization of the Company consists of the following classes of capital stock as of January 31, 2018:

 

Preferred Stock

 

The Company has authorized 15,000,000 shares of preferred stock with a par value of $0.0001 per share. The Board of Directors are authorized to divide the authorized shares of Preferred Stock into one or more series, each of which shall be so designated as to distinguish the shares thereof from the shares of all other series and classes. No shares of preferred stock have been issued.

 

Common Stock

 

On October 9, 2015, the authorized number of shares of the Company’s common stock was increased from 100,000,000 shares to 1,000,000,000 shares.

 

The Company now has authorized 1,000,000,000 shares of common stock with a par value of $0.0001 per shares. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.

 

During the year ended January 31, 2018, there were no issuance of common stock.

 

During the year ended January 31, 2017, there were no issuance of common stock.

 

As at January 31, 2018 and 2017, the Company had 74,976,241 common shares issued and outstanding.

 

The Company has no stock option plan, warrants or other dilutive securities.

 

Contingently Issuable Common Stock

 

On January 29, 2016, the Company entered into an exchange agreement with Mr. Yang Baojin (the “Agreement”), a citizen of the PRC, and Huaxin, the wholly owned subsidiary of Xing Rui, which is a wholly owned subsidiary of the Company. Mr. Yang is the president and majority owner of Tieshan Oil. The exchange was closed on January 29, 2016.

 

Pursuant to the Agreement, the Company agreed to issue 6,000,000 shares of its common stock, par value $0.0001, to Mr. Yang, and Mr. Yang delivered to Huaxin an ownership interest in Tieshan Oil such that Huaxin owns 51% of all ownership interests in Tieshan Oil, provided that 1,200,000 shares of the Company’s common stock (20% of the common stock to be delivered to Mr. Yang) were withheld by the Company for a period of 12 months in order to secure against breach by Mr. Yang of his representations and warranties contained in the agreement, as well as to secure the fulfillment of his covenants and further obligations under the agreement. The Company did not issue these 1,200,000 additional escrow shares and accordingly excludes them from the calculation of common stock issued and outstanding.

 

During the year ended January 31, 2017, the Company cancelled the 1,200,000 shares of escrowed and recorded as additional paid in capital.

 

Additional Paid-In Capital

 

During the year ended January 31, 2018 and 2017, related parties contributed additional paid-in capital in the amount of $111,066 and $147,348, to fund operating expenses.

 

During the year ended January 31, 2016, related parties contributed additional paid-in capital in the amount of $95,669, to fund operating expenses.

 

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NOTE 10 – RELATED PARTY TRANSACTIONS

 

Revenue, receivable and prepaid expenses

 

During the year ended January 31, 2018 and 2017, the Company generated revenue from two related parties of $0 and $21,128,105, respectively, which were related companies under common control with the Company.

 

At January 31, 2018 and 2017, the Company had amount due from related parties of $1,567,238 and $26,747,696, respectively. As of January 31, 2017, it consists of prepaid expenses of $1,567,238. As of January 31, 2017, it consists of a trade receivable past due within 1 month of $14,091,462 from a related company and a trade receivable past due within 1 year of $12,656,234 from another related company. All the related companies were customers of the Company and were under common control with the Company.

 

Accounts payable, other liabilities and loans

 

At January 31, 2018 and 2017, the Company had accounts payable and accrued liabilities of $17,514,842 and $63,270,068 to four related companies under common control with the Company, respectively.

 

In support of the Company’s efforts and cash requirements, it may rely on advances from related parties until such time that the Company can support its operations or attains adequate financing through sales of its equity or traditional debt financing. There is no formal written commitment for continued support by shareholders or directors. Amounts represent advances or amounts paid in satisfaction of liabilities. The advances were considered temporary in nature and were not formalized by a promissory note.

 

During the year ended January 31, 2018 and 2017, the Company received $116,704 and $96,899 advances from various directors and shareholders and repaid $80,955 and $49,693, respectively. At January 31, 2018 and 2017, the Company owed $12,695 and $12,695 to a director of the Company, $5,203 and $5,203 to a director of Xin Rui HK, $19,368 and $12,197 to directors of Huaxin, $141,931 and $208,700 to directors of Amuli and $50,948 and $46,558 to shareholders of Amuli, for vendor payments made by those directors.

 

The amounts and terms of the above transactions may not necessarily be indicative of the amounts and terms that would have been incurred had comparable transactions been entered into with independent third parties.

 

As of January 31, 2018 and 2017, Due to related parties consist of the follows;

 

 

 

January 31,

 

 

January 31,

 

 

 

2018

 

 

2017

 

Accounts payable

 

$ 17,490,485

 

 

$ 63,259,434

 

Accrued liabilities

 

 

24,357

 

 

 

10,634

 

Loan from related parties

 

 

230,145

 

 

 

285,353

 

 

 

$ 17,744,987

 

 

$ 63,555,421

 

 

Employment

 

The Company does not have employment contracts with its key employees, including the controlling shareholders who are officers of the Company.

 

Contribution

 

During the years ended January 31, 2018 and 2017, related parties, who are shareholders of the Company, forgave debt, in the amount of $111,066 and $147,348, respectively for payments made on behalf of the Company for operating expenses. The amount has been recognized as a contribution to capital.

 

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NOTE 11 – COMMITMENTS AND CONTINGENCIES

 

On August 23, 2016, Amuli entered into a lease agreement for office space in Shenzhen city, Guangdong Province, P.R.C. commencing on August 23, 2016 for a three-year lease term. The monthly rental expense is approximately $6,762 (RMB 42,526).

 

As of January 31, 2018, the outstanding lease commitments are: 

 

Year 1

 

$ 81,140

 

Year 2

 

 

47,332

 

 

 

$ 128,472

 

 

As of January 31, 2017, the outstanding lease commitments are:

 

Year 1

 

$ 72,444

 

Year 2

 

 

72,444

 

Year 3

 

 

42,259

 

 

 

$ 187,147

 

 

NOTE 12 – INCOME TAXES

 

The Company provides for income taxes under ASC 740, “Income Taxes. ASC 740 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax basis of assets and liabilities and the tax rates in effect when these differences are expected to reverse. It also requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

 

The Company is subject to taxation in the United States and China.

 

The statutory federal income tax rate of the United States is 34%. The statutory federal income tax rate of China is 25%.

 

As of January 31, 2017, the Company has loss carry forwards for US Federal income taxes of approximately $390,800 and for Chinese income taxes of approximately $340,900. US Federal net operating loss carryforwards may be carried forward up to a maximum of 20 years and will begin expiring in 2032. The utilization of these NOLs may become subject to limitations based on past and future changes in ownership of the Company pursuant to Internal Revenue Code Section 382. Chinese net operating loss carryforwards may be carried forward up to a maximum of 5 years and will begin expiring in 2021. At January 31, 2018 and 2017, Tieshan Oil and Amuli had $6,476 and $9,289 income tax payable for prior years’ income.

 

The deferred tax assets created from current and prior year net operating loss carry forwards have been calculated at 34% rate in the United States and the 25% rate in China. Deferred tax assets were comprised of the following as of January 31, 2018 and 2017:

 

 

 

January 31,

 

 

January 31,

 

 

 

2018

 

 

2017

 

NOL carryforward

 

 

 

 

 

 

Total deferred tax asset

 

$ 220,410

 

 

$ 156,869

 

Total deferred tax liabilities

 

 

-

 

 

 

-

 

Less valuation allowance

 

 

(220,410 )

 

 

(156,869 )

Net deferred tax asset

 

$ -

 

 

$ -

 

 

On December 22, 2017, the United States enacted the Tax Cuts and Jobs Act (the “Act”) resulting in significant modifications to existing law. The Company has completed the accounting for the effects of the Act during the quarter ended December 31, 2017. The Company’s financial statements for the year ended December 31, 2017 reflect certain effects of the Act which includes a reduction in the corporate tax rate from 34% to 21% as well as other changes.

 

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The benefit for income taxes differed from the amount computed using the statutory United State tax rate of 34% for January 31, 2018 and 2017 as follows:

 

 

 

Year Ended January 31,

 

 

 

2018

 

 

2017

 

Income tax benefit at statutory rate

 

$ (130,332 )

 

$ (726,844 )

Difference in rates

 

 

15,984

 

 

 

12,453

 

Effect of change in statutory rate

 

 

50,807

 

 

 

-

 

Non-deductible expenses

 

 

-

 

 

 

648,485

 

Change in valuation allowance

 

 

63,541

 

 

 

65,906

 

Income tax benefit

 

$ -

 

 

$ -

 

 

The Company records a valuation allowance against deferred tax assets to the extent that it is more likely than not that some portion, or all of, the deferred tax assets will not be realized. Due to the substantial doubt related to the Company’s ability to continue as a going concern and utilize its deferred tax assets, a valuation allowance for the full amount of the deferred tax assets has been established at January 31, 2017. As a result of this valuation allowance there are no income tax benefits reflected in the accompanying statement of operations to offset pre-tax losses.

 

The Company has no uncertain tax positions as of January 31, 2018 and 2017 due to limited nature of its operations. Income taxes for the years ended January 31, 2013 through 2015 remain subject to examination.

 

NOTE 13 - SEGMENTED INFORMATION

 

At January 31, 2017, the Company operates in two industry segments, health beverage and oil and gas, and one geographic segment, China, where majority current assets and equipment are located.

 

Segment assets and liabilities as of January 31, 2018 and 2017 were as follows:

 

January 31, 2018

 

Holding Company

 

 

Health beverage

 

 

Oil and gas

 

 

Total Consolidated

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

$ 5,192

 

 

$ 98,151

 

 

$ 24,411,842

 

 

$ 24,515,185

 

Non-current assets

 

 

-

 

 

 

-

 

 

 

1,990,367

 

 

 

1,990,367

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

145,316

 

 

 

531,184

 

 

 

19,412,315

 

 

 

20,088,815

 

Net assets (liabilities)

 

$ (140,124 )

 

$ (433,033 )

 

$ 6,989,894

 

 

$ 6,416,737

 

 

January 31, 2017

 

Holding Company

 

 

Health beverage

 

 

Oil and gas

 

 

Total Consolidated

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

$ 5,820

 

 

$ 33,844

 

 

$ 69,845,223

 

 

$ 69,884,887

 

Non-current assets

 

 

-

 

 

 

83,190

 

 

 

1,998,428

 

 

 

2,081,618

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

44,058

 

 

 

268,092

 

 

 

65,359,331

 

 

 

65,671,481

 

Net assets (liabilities)

 

$ (38,238 )

 

$ (151,058 )

 

$ 6,484,320

 

 

$ 6,295,024

 

 

Segment revenue and net loss for the years ended January 31, 2018 and 2017 were as follows:

 

Year Ended January 31, 2018

 

Holding Company

 

 

Health beverage

 

 

Oil and gas

 

 

Total Consolidated

 

Revenue

 

$ -

 

 

$ 1,916

 

 

$ 39,610,587

 

 

$ 39,612,503

 

Cost of goods sold

 

 

-

 

 

 

(6 )

 

 

(39,349,592 )

 

 

(39,349,598 )

Operating expenses

 

 

(211,477 )

 

 

(254,252 )

 

 

(110,587 )

 

 

(576,316 )

Other expenses

 

 

-

 

 

 

-

 

 

 

(63,898 )

 

 

(63,898 )

Provision for income taxes

 

 

-

 

 

 

-

 

 

 

(6,021 )

 

 

(6,021 )

Net loss

 

$ (211,477 )

 

$ (252,342 )

 

$ 80,489

 

 

$ (383,330 )

 

Year Ended January 31, 2017

 

Holding Company

 

 

Health beverage

 

 

Oil and gas

 

 

Total Consolidated

 

Revenue

 

$ -

 

 

$ -

 

 

$ 94,798,849

 

 

$ 94,798,849

 

Cost of goods sold

 

 

-

 

 

 

-

 

 

 

(94,247,019 )

 

 

(94,247,019 )

Operating expenses

 

 

(101,616 )

 

 

(224,305 )

 

 

(424,193 )

 

 

(750,114 )

Other income

 

 

-

 

 

 

77,528

 

 

 

-

 

 

 

77,528

 

Other expenses

 

 

(1,907,309 )

 

 

-

 

 

 

(104,257 )

 

 

(2,011,566 )

Provision for income taxes

 

 

-

 

 

 

-

 

 

 

(5,454 )

 

 

(5,454 )

Net loss

 

$ (2,008,925 )

 

$ (146,777 )

 

$ 17,926

 

 

$ (2,137,776 )

  

NOTE 14 - SUBSEQUENT EVENTS

 

Management has evaluated subsequent events through the date these financial statements were available to be issued. Based on our evaluation no material events have occurred that require disclosure.

 

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

 

On or about December 6, 2017 the Company received notification from the US Securities and Exchange Commission (“SEC”) that the Public Company Accounting Oversight Board (“PCAOB”) has revoked the registration of our independent registered public accounting firm, Anthony Kam & Associates Ltd. (“AKAM”). As a result of the notification, effective December 6, 2017, the Company dismissed AKAM as the Company’s auditor. Concurrently with our dismissal of AKAM, our Board of Directors approved the engagement of WWC, Professional Corporation (“WWC”) of San Mateo, California as the new independent registered public accounting firm for the Company. The decision to change our independent registered public accounting firm was approved by the Company’s Board of Directors.

 

The Company originally engaged AKAM on July 3, 2015. During the period from July 3, 2015 to December 6, 2017 there were no disagreements with AKAM on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which, if not resolved to AKAM’s satisfaction, would have caused the auditor to make reference to the subject matter of the disagreement in connection with its report. The reports of AKAM on the financial statements of our Company’s for the fiscal years ended January 31, 2017 and January 31, 2016 did not contain an adverse opinion or disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope or accounting principles, except that the reports contained an explanatory paragraph stating that there was substantial doubt about the Company’s ability to continue as a going concern.

 

During our two most recent fiscal years, the subsequent interim periods thereto, and through December 6, 2017, the engagement date of WWC, neither the Company, nor someone on its behalf, has consulted WWC regarding either: (i) the application of accounting principles to a specified transaction, either completed or proposed, (ii) the type of audit opinion that might be rendered on the Company’s financial statements by WWC, in either case where written or oral advice provided by WWC would be an important factor considered by us in reaching a decision as to any accounting, auditing or financial reporting issues; or (iii) any other matter that was the subject of a disagreement between us and our former auditor or was a reportable event (as described in Items 304(a)(1)(iv) or Item 304(a)(1)(v) of Regulation S-K, respectively).

 

Item 9A. Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

Under the supervision and with the participation of our senior management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the period covered by this Annual Report on Form 10-K (the “Evaluation Date”). Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded as of the Evaluation Date that our disclosure controls and procedures were not effective such that the information relating to us required to be disclosed in our Securities and Exchange Commission (“SEC”) reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) is accumulated and communicated to our management, including our Chief Executive Officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

 

Management’s Annual Report on Internal Control Over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives. With the participation of our Chief Executive and Financial Officer, our management conducted an evaluation of the effectiveness of our internal control over financial reporting as of January 31, 2018 based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control – Integrated Framework (2013). Based upon such evaluation, our management concluded that we did not maintain effective internal control over financial reporting as of January 31, 2018 based on the COSO framework criteria, as more fully described below. This was due to deficiencies that existed in the design or operation of our internal controls over financial reporting that adversely affected our internal controls and that may be considered to be material weaknesses.

 

 
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The matters involving internal controls and procedures that our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee, (2) lack of a majority of outside Directors on our Board of Directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (3) inadequate segregation of duties consistent with control objectives; and (4) management dominated by a single individual without adequate compensating controls. The aforementioned material weaknesses were identified by our Chief Executive and Financial Officer in connection with the review of our financial statements as of January 31, 2018.

 

Management believes that the material weaknesses set forth above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside Directors on our Board of Directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.

 

This Annual Report on Form 10-K does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to an exemption for non-accelerated filers from the internal control audit requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002.

 

Changes in Internal Control Over Financial Reporting

 

There have been no changes in our internal control over financial reporting that occurred during the year ended January 31, 2018 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

 

Item 9B. Other Information.

 

None.

 

 
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PART III

 

Item 10. Directors, Executive Officers and Corporate Governance

 

All Directors of the Company hold office until the next annual meeting of the security holders or until their successors have been elected and qualified. The officers of the Company are appointed by the Board of Directors and hold office until their death, resignation or removal from office. The Directors and Executive Officers, their ages, positions held, and duration as such, are as follows:

 

Name

Position Held with the Company

Age

Date First Elected or Appointed

DS Chang

President, CEO, Director

48

February 9, 2018

Patrick Tan

Treasurer, CFO, Director

47

February 9, 2018

Jacky Chang

Secretary

42

February 9, 2018

 

Business Experience

 

The following is a brief account of the education and business experience during at least the past five years of each current Director, Executive Officer and key employee of the Company, indicating the person’s principal occupation during that period, and the name and principal business of the organization in which such occupation and employment were carried out.

 

Mr. Ding-Shin “DS” Chang has since 2016 owned and operated his own financial services company, SGCI, with offices in Paris, London, Frankfurt, Hong Kong and Beijing, providing consulting services in the areas of lease financing, term financing, project financing, investment funds, fund management, corporate restructuring, and company reorganization. In 2013, he became the Vice-Chairman at a French financial group, a listing sponsor for NYSE-Euronext. His clients included companies from different countries across the globe. He worked for 16 years as a financial specialist and corporate Director serving the IT industry. Mr. Chang’s international professional career has spanned over 25 years, and he is fluent in French, English, and Mandarin.

 

Dr. Boon-Jin “Patrick” Tan founded Admall in 2015 and serves as its chairman. Mr. Tan specializes in corporate branding and identity and has many years of experience researching the human brain and cognition in the context of applied marketing, advertising and branding. Mr. Tan received the Asia Pacific Entrepreneurship Award in 2008 and has been awarded honorary degrees by Shenzhen University (China), Victoria University (Hong Kong), Carlton College (USA), California University School of International Business Studies (USA) and Sabi University (France). He was granted the honorary title of Dato’ Sri in 2016, by the Sultan of Pahang.

 

Mr. Liang-Yu “Jacky” Chang specializes in investor relations in connection with initial public offerings in the United States, the People’s Republic of China and Taiwan. He has held positions with Taiwan’s Chip Hope (8084:TT) and J Touch Corporation (TPE:3584), and United States listed companies GIA Investments Corp. (OTCMKTS:GIAI) and Nownews Digital Media Technology Co. Ltd. (OTCMKTS:NDMT). From 2015 to 2017 Mr. Chang served as Vice President of Asia for Marechal & Associes Limited, and since 2017 he has served Vice President for the German company, SGCI Corporate Finance GmbH.

 

 
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Employment Agreements

 

Other than as set out below, we have no formal employment agreements with any of our employees, Directors or officers.

 

Family Relationships

 

None.

 

Involvement in Certain Legal Proceedings

 

None of our Directors, Executive Officers, promoters or control persons has been involved in any of the following events during the past 10 years:

 

1. A petition under the Federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an Executive Officer at or within two years before the time of such filing;

 

2. Such person was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);

 

3. Such person was the subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from, or otherwise limiting, the following activities:

 

i.

Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, Director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity

ii.

Engaging in any type of business practice; or

iii.

Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities laws or Federal commodities laws;

 

 
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4. Such person was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in paragraph (f)(3)(i) of this section, or to be associated with persons engaged in any such activity;

 

5. Such person was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;

 

6. Such person was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;

 

7. Such person was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:

 

i.

Any Federal or State securities or commodities law or regulation; or

ii.

Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or

iii.

Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

 

8. Such person was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

 

Compliance with Section 16(a) of the Exchange Act.

 

Section 16(a) of the Exchange Act requires the Company’s Directors, Executive Officers and persons who own more than ten percent of a registered class of the Company’s equity securities (“10% holders”), to file with the SEC initial reports of ownership and reports of changes in ownership of Common Stock and other equity securities of the Company. Directors, officers and 10% holders are required by SEC regulation to furnish the Company with copies of all of the Section 16(a) reports they file.

 

Based solely on a review of reports furnished to the Company or written representations from the Company’s Directors and Executive Officers, there are no known incidents of non-compliance for the reporting year.

 

Code of Ethics

 

We have adopted a corporate code of ethics. We believe our code of ethics is reasonably designed to deter wrongdoing and promote honest and ethical conduct; provide full, fair, accurate, timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of code violations; and provide accountability for adherence to the code. The Company will provide to any person, without charge and upon request, a copy of the code of ethics. Any such request must be made in writing to the Company at No. 10-2-4B, Jin Di Shang Tang Garden, Long Hua Xin Qu Shang Tang Road, Shenzhen, Guang Dong, China.

 

 
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Board and Committee Meetings

 

Our Board of Directors currently consists of two members, DS Chang and Patrick Tan. The Board held no formal meetings during the year ended January 31, 2018. Until the Company develops a more comprehensive Board of Directors, all proceedings will be conducted by resolutions consented to in writing by all the Directors and filed with the minutes of the proceedings of the Directors. Such resolutions consented to in writing by the Directors entitled to vote on that resolution at a meeting of the Directors are, according to the Nevada General Corporate Law and our Bylaws, as valid and effective as if they had been passed at a meeting of the Directors duly called and held.

 

Nomination Process

 

During the year ended January 31, 2018, we did not effect any material changes to the procedures by which our shareholders may recommend nominees to our Board of Directors. Our Board of Directors does not have a policy with regards to the consideration of any Director candidates recommended by our shareholders. Our Board of Directors has determined that it is in the best position to evaluate our company’s requirements as well as the qualifications of each candidate when the Board of Directors considers a nominee for a position on our Board of Directors. If shareholders wish to recommend candidates directly to our Board of Directors, they may do so by sending communications to the President of our Company at the address on the cover of this Annual Report on Form 10-K.

 

Audit Committee

 

Currently the Company is developing a comprehensive Board of Directors and does not have an Audit Committee. The Company intends to appoint audit, compensation and other applicable committee members as it identifies individuals with pertinent expertise.

 

Audit Committee Financial Expert

 

Our Board of Directors does not have a member that qualifies as an “audit committee financial expert” as defined in Item 407(d)(5)(ii) of Regulation S-K. The Company intends to appoint audit, compensation and other applicable committee members as it identifies individuals with pertinent expertise.

 

Item 11. Executive Compensation.

 

The particulars of the compensation paid to the following persons:

 

(a)

our Principal Executive Officer;

(b)

each of our two most highly compensated Executive Officers who were serving as Executive Officers at the end of the year ended January 31, 2018, and

(c)

up to two additional individuals for whom disclosure would have been provided under (b) but for the fact that the individual was not serving as our Executive Officer at the end of the year ended January 31, 2018.

 

 
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who we will collectively refer to as the named Executive Officers of the Company, are set out in the following summary compensation table, except that no disclosure is provided for any named Executive Officer, other than the Principal Executive Officers, whose total compensation did not exceed $100,000 for the respective fiscal year.

 

2017 SUMMARY COMPENSATION TABLE

Name and Principal Position

 

Year

 

Salary

($)

 

 

Bonus

($)

 

 

Stock Awards

($)

 

 

Option Awards

($)

 

 

Non-Equity

Incentive Plan

Compensation

($)

 

 

Change in

Pension Value

and Nonqualified

Deferred

Compensation

Earnings

($)

 

 

All Other

Compensation

($)

 

 

Total

($)

 

DC Chang,

 

2017

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

President, CEO, Director

 

2016

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Patrick Tan,

 

2017

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

Treasurer, CFO, Director

 

2016

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Jacky Chang,

 

2017

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

Secretary

 

2016

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

 

0

 

 

Other than set out below there are no arrangements or plans in which we provide pension, retirement or similar benefits for Directors or Executive Officers. Our Directors and Executive Officers may receive share options at the discretion of our Board of Directors in the future. We do not have any material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our Directors or Executive Officers, except that share options may be granted at the discretion of our Board of Directors.

 

Grants of Plan-Based Awards

 

There were no grants of plan-based awards during the year ended January 31, 2018.

 

Outstanding Equity Awards at Fiscal Year End

 

There were no outstanding equity awards at the year ended January 31, 2018.

 

Option Exercises and Stock Vested

 

During our fiscal year ended January 31, 2018, there were no options exercised by our named officer.

 

Compensation of Directors

 

We do not have any agreements for compensating our Directors for their services in their capacity as Directors.

 

Pension, Retirement or Similar Benefit Plans

 

There are no arrangements or plans in which we provide pension, retirement or similar benefits for Directors or Executive Officers. We have no material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our Directors or Executive Officers, except that stock options may be granted at the discretion of the Board of Directors or a committee thereof.

 

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

 

The following table sets forth, as of May 16, 2018 certain information with respect to the beneficial ownership of our common shares by each shareholder known by us to be the beneficial owner of more than 5% of our common shares, as well as by each of our current Directors and Executive Officers as a group. Each person has sole voting and investment power with respect to the shares of common stock, except as otherwise indicated. Beneficial ownership consists of a direct interest in the shares of common stock, except as otherwise indicated.

 

Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person’s actual ownership or voting power with respect to the number of shares of common stock actually outstanding on May 16, 2018. As of May 16, 2018, there were 74,976,241 shares of our company’s common stock issued and outstanding.

  

Name and Address of Beneficial Owner

 

Amount and

Nature

of Beneficial

Ownership

 

 

Percentage

of Class (1)

 

DS Chang(2)

 

 

0

 

 

 

0.00 %

Patrick Tan(3)

 

 

0

 

 

 

0.00 %

Jacky Chang(4)

 

 

0

 

 

 

0.00 %

 

 

 

 

 

 

 

 

 

Directors and Executive Officers as a Group (3 persons)

 

 

0

 

 

 

0.00 %

 

 

 

 

 

 

 

 

 

5% or greater shareholders

 

 

 

 

 

 

 

 

Yang Baojin(5)

 

 

4,800,000

 

 

 

6.40 %

____________

 

(1) Percentages are calculated based on 74,976,241 shares of our company’s common stock issued and outstanding on May 15, 2018.

 

(2) Address at 12 Rue de Lorraine 92300, Levallois-Perret, France.

 

(3) Address at D-15-05 Menara Mitraland, Jalan Pju 5/1, Kota Damansara, 47810 Selangor, Malaysia.

 

(4) Address at 2F, No. 63, Sec 6, Xinhai Road, Taipei, Taiwan.

 

(5) Address at Beijng Fanshan Yandong Chemical Factory, Zhiu Zhuang Tsuen, Fanshan District, Beijing, China.

 

Changes in Control

 

If the Company, Admall and the Admall Sellers close the Admall Exchange, the Admall Exchange would result in the Admall Sellers owning the majority of the voting stock of the Company and would thus result in a change of control of the Company. For more information on the Admall Exchange, please see Part I, Item 1 (“Business”) of this Annual Report on Form 10-K.

 

 
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Item 13. Certain Relationships and Related Transactions, and Director Independence.

 

Revenue, receivable and prepaid expenses

 

During the year ended January 31, 2018 and 2017, the Company generated revenue from two related parties of $0 and $21,128,105, respectively, which were related companies under common control with the Company.

 

At January 31, 2018 and 2017, the Company had amount due from related parties of $1,567,238 and $26,747,696, respectively. As of January 31, 2017, it consists of prepaid expenses of $1,567,238. As of January 31, 2017, it consists of a trade receivable past due within 1 month of $14,091,462 from a related company and a trade receivable past due within 1 year of $12,656,234 from another related company. All the related companies were customers of the Company and were under common control with the Company.

 

Accounts payable, other liabilities and loans

 

At January 31, 2018 and 2017, the Company had accounts payable and accrued liabilities of $17,514,842 and $63,270,068 to four related companies under common control with the Company, respectively.

 

In support of the Company’s efforts and cash requirements, it may rely on advances from related parties until such time that the Company can support its operations or attains adequate financing through sales of its equity or traditional debt financing. There is no formal written commitment for continued support by shareholders or directors. Amounts represent advances or amounts paid in satisfaction of liabilities. The advances were considered temporary in nature and were not formalized by a promissory note.

 

During the year ended January 31, 2018 and 2017, the Company received $1,250 and $96,899 advances from various directors and shareholders and repaid $80,955 and $49,693, respectively. At January 31, 2018 and 2017, the Company owed $12,695 and $12,695 to a director of the Company, $5,203 and $5,203 to a director of Xin Rui HK, $9,616 and $8,352 to directors of Huaxin, $141,931 and $208,406 to directors of Amuli and $50,948 and $46,558 to shareholders of Amuli, for vendor payments made by those directors.

 

The amounts and terms of the above transactions may not necessarily be indicative of the amounts and terms that would have been incurred had comparable transactions been entered into with independent third parties.

 

As of January 31, 2018 and 2017, Due to related parties consist of the follows;

 

 

 

January 31,

 

 

January 31,

 

 

 

2018

 

 

2017

 

Accounts payable

 

$ 17,490,485

 

 

$ 63,259,434

 

Accrued liabilities

 

 

24,357

 

 

 

10,634

 

Loan from related parties

 

 

220,393

 

 

 

281,507

 

 

 

$ 17,735,235

 

 

$ 63,551,575

 

 

Employment

 

The Company does not have employment contracts with its key employees, including the controlling shareholders who are officers of the Company.

 

Contribution

 

During the years ended January 31, 2018 and 2017, related parties, who are shareholders of the Company, forgave debt, in the amount of $111,066 and $147,348, respectively for payments made on behalf of the Company for operating expenses. The amount has been recognized as a contribution to capital.

 

Director Independence

 

The Company does not have a separately designated nominating committee for its Board. None of our Directors is deemed to be independent, as such term is defined in the listing standards of The Nasdaq Stock Market, Inc. (“Nasdaq”).

 

 
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Item 14. Principal Accounting Fees and Services.

 

The aggregate fees billed for the most recently completed fiscal year ended January 31, 2018 and 2017 for professional services rendered by the principal accountant for the audit of our annual financial statements and review of the financial statements included in our quarterly reports on Form 10-Q and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows:

 

 

 

Year Ended

January 31,

2018

 

 

Year Ended

January 31,

2017

 

Audit Fees (1)

 

$ 50,000

 

 

$ 50,000

 

Audit Related Fees (2)

 

$ -

 

 

$ -

 

Tax Fees (3)

 

$ -

 

 

$ -

 

All Other Fees (4)

 

$ -

 

 

$ -

 

Total

 

$ 50,000

 

 

$ 50,000

 

_________

(1) Audit fees consist of fees incurred for professional services rendered for the audit of our financial statements, for reviews of our interim financial statements included in our quarterly reports on Form 10-Q and for services that are normally provided in connection with statutory or regulatory filings or engagements.

(2) Audit-related fees consist of fees billed for professional services that are reasonably related to the performance of the audit or review of our financial statements, but are not reported under “Audit fees.”

(3) Tax fees consist of fees billed for professional services relating to tax compliance, tax planning, and tax advice.

(4) All other fees consist of fees billed for all other services.

 

Our Board of Directors pre-approves all services provided by our independent auditors. All of the above services and fees were reviewed and approved by the Board of Directors either before or after the respective services were rendered.

 

Our Board of Directors has considered the nature and amount of fees billed by our independent auditors and believes that the provision of services for activities unrelated to the audit is compatible with maintaining our independent auditors’ independence.

 

 
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PART IV

 

Item 15. Exhibits, Financial Statement Schedules

 

The following exhibits are included as part of this report:

 

Incorporated by Reference

Exhibit

Number

Exhibit Description

Form

Exhibit

Filing Date

3.1

Articles of Incorporation and Amendments, as filed with the Nevada Secretary of State.

S-1

3.1

3/22/2013

3.2

Certificate of Amendment to Articles of Incorporation

10-K

3.2

5/13/2016

3.3

By-Laws of Registrant.

S-1

3.2

3/22/2013

10.1

Exchange Agreement, dated as of January 29, 2016, Resort Savers, Inc., Yang Baojin, and Huaxin Changrong (Shenzhen) Technology Service Company Limited, relating to Beijing Yandong Tieshan Oil Products Co., Ltd.

8-K

10.1

2/01/2016

10.2

Share Exchange Agreement, dated as of December 7, 2017, by and among Resort Savers, Inc., Dusun Eco Resort (2015) Sdn. Bhd., and the shareholders of Dusun Eco Resort (2015) Sdn. Bhd.

8-K

10.1

12/08/2017

10.3

Share Exchange Agreement, dated as of February 9, 2018, by and among Resort Savers, Inc., Admall Sdn. Bhd., and the shareholders of Admall Sdn. Bhd.

8-K

10.1

2/09/2018

10.4

Termination of Share Exchange Agreement, dated as of February 9, 2018, by and among Resort Savers, Inc., Dusun Eco Resort (2015) Sdn. Bhd., and the shareholders of Dusun Eco Resort (2015) Sdn. Bhd.

8-K

10.2

2/09/2018

14.1

Code of Ethics.

10-K

14.1

05/01/2014

21.1*

Subsidiaries of the Registrant.

31.1*

Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.

31.2*

Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.

32.1*

Rule 1350 Certifications of Chief Executive Officer and Chief Financial Officer.

101.INS*

XBRL Instance Document.

101.SCH*

XBRL Taxonomy Extension Schema Document.

101.CAL*

XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF*

XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB*

XBRL Taxonomy Extension Label Linkbase Document.

101.PRE*

XBRL Taxonomy Extension Presentation Linkbase Document.

__________

* Filed herewith.

 

 
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SIGNATURES

 

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, thereto duly authorized.

 

RESORT SAVERS, INC.

(Registrant)

 

Dated: May 16, 2018

By:

/s/ DS Chang

DS Chang

President, CEO

(Principal Executive Officer)

   

Dated: May 16, 2018

By:

/s/ Patrick Tan

Patrick Tan

Chief Financial Officer

(Principal Financial and Accounting Officer)

 

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.

 

Dated: May 16, 2018

By:

/s/ DS Chang

DS Chang

President, Chief Executive Officer and Director

   

Dated: May 16, 2018

By:

/s/ Patrick Tan

Patrick Tan

Treasurer, Chief Financial Officer and Director

 

 

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