UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-K

(Mark One)

 

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

 

For the Fiscal Year Ended April 30, 2018

 

OR

 

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

 

Commission File Number: None

 

THE DIAMOND CARTEL, INC.

 (Name of Small Business Issuer in its charter)

 

Delaware		80-0914174
(State of incorporation)		(IRS Employer Identification No.)

  

28 Banting Crescent, London, Ontario, Canada		N6G 4G2
(Address of principal executive office)		(Zip Code)

 

Registrant's telephone number, including area code: (519) 619-4370

 

Securities registered pursuant to Section 12(b) of the Act:  None

 

Securities registered pursuant to Section 12(g) of the Act:  Common Stock

 

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

 

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

 

Indicate by check mark whether the registrant (1) has filed all reports to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes ☒   No ☐

 

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

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K  ☒

 

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

 

Large accelerated filer	☐		Non-accelerated filer	☐	(Do not check if a smaller reporting company)
Accelerated filer	☐		Smaller reporting company	☒
			Emerging growth company	☐

 

If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

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

 

The aggregate market value of the voting stock held by non-affiliates of the Company on October 31, 2017, was $-0-.

 

As of July 31, 2018 the Company had 895,750 outstanding shares of common stock.

 

Documents incorporated by reference:  None.

 

 

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

 

This report includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, which include but are not limited to, statements concerning our business strategy, plans and objectives, projected revenues, expenses, gross profit, income, and mix of revenue. These forward-looking statements are based on our current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by us. Words such as "anticipates," "expects," "intends," "plans," "predicts," "potential," "believes," "seeks," "hopes," "estimates," "should," "may," "will," "with a view to" and variations of these words or similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements.

 

 

Item 1.  Business

 

We are currently a Blank Check Company incorporated on August 17, 2005 as a Delaware Corporation. We plan to acquire a privately held company using shares of our common stock. As of July 31, 2018 we had entered into a Letter of Intent with an unrelated third party. Except for this Letter of Intent, we have not identified any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with respect to identifying any business combination target.

 

Business Strategy

 

We intend to pursue an acquisition opportunity in any business industry or sector. However, we believe the following general criteria and guidelines are important in evaluating prospective target businesses, but we may decide to enter into a business combination with a target business that does not meet these criteria and guidelines.

 

●

High-Growth Markets.  We will seek out opportunities in faster-growing segments of developed markets and emerging international markets.

 

●

Business with Revenue and Earnings Growth Potential.  We will seek to acquire one or more businesses that have multiple, diverse potential drivers of revenue and earnings growth, including but not limited to a combination of development, production, digital and distribution capabilities and balance sheet management. We will focus on assets that currently are undervalued or sub-optimally managed, including those undergoing debt or operational restructuring, where our management is well-positioned to unlock their value.

 

●

Companies with Potential for Strong Free Cash Flow Generation.  We will seek to acquire one or more businesses that have the potential to generate strong and stable free cash flow.

 

We anticipate structuring our business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our business combination could own less than a majority of our outstanding shares subsequent to our business combination.

 

We plan to acquire another entity solely with shares of our common stock. In this offering, we are not raising any capital and none of our shareholders are selling their shares. At some point in time, after the effective date of our registration statement, of which this prospectus is a part, we will identify a business we want to acquire and will begin to negotiate the terms of the potential acquisition. Once the terms have been agreed upon, we will sign an agreement with the shareholders of the target entity reflecting the terms of the acquisition.

 

Once we enter into an agreement to acquire the target entity, we will file an 8-K report under Item 1.01 of Form 8-K, which will contain all the information required by Rule 144(i)(2), as well as the number of shares we propose to issue in connection with the acquisition and the method we used to determine the value of the target entity. We will also file a post-effective amendment to our registration statement disclosing the same information in the 8-K report, plus any other information required by the instructions to Form S-1 and Regulation S-X.

 

 

The agreement with the shareholders of the target entity will provide, among other things, that our offer to exchange shares of our common stock for shares of the target entity is subject to:

 

●

The shareholder’s receipt of the post-effective amendment;

 

●

The shareholders of the target entity owning a certain percentage of the outstanding shares of the target entity affirming the exchange of their shares for the shares of our common stock. The percentage required for affirmation will be negotiated between us and the target entity.

 

The agreement with the shareholders of the target entity will be with each shareholder. No merger will be involved and it is not expected the target entity will not call a meeting of its shareholders to approve the terms of the agreement.

 

The acquisition of the target entity will be approved by our board of directors. We will not call a meeting of our shareholders to approve the acquisition of the target entity. Our shareholders will not be entitled to dissenters’ rights in connection with the acquisition of the target entity.

 

Once we complete the acquisition of the target entity, we will file an 8-K report under Item 2.01 of Form 8-K.

 

We will not issue any shares of our common stock until the shareholders of the target entity, owning the minimum number of shares required by our agreement with the target entity, have accepted our offer with respect to the exchange of their shares for shares of our common stock.

 

We will determine the value of any business we acquire based upon:

 

●

the value of the assets less the liabilities of the business;

 

●

the anticipated earnings of the business, or

 

●

a combination of the foregoing.

 

Status as a public company

 

We believe our structure will make us an attractive business combination partner to target businesses. As a public company, we offer a target business an alternative to the traditional initial public offering through a merger or other business combination. In this situation, the owners of the target business would exchange their shares of stock in the target business for shares of our stock or for a combination of shares of our stock and cash, allowing us to tailor the consideration to the specific needs of the sellers. Although there are various costs and obligations associated with being a public company, we believe target businesses will find this method a more certain and cost effective method to becoming a public company than the typical initial public offering. In a typical initial public offering, there are additional expenses incurred in marketing, road show and public reporting efforts that may not be present to the same extent in connection with a business combination with us.

 

Furthermore, once a proposed business combination is completed, the target business will have effectively become public, whereas an initial public offering is always subject to the underwriters’ ability to complete the offering, as well as general market conditions, which could prevent the offering from occurring. Once public, we believe the target business would then have greater access to capital and an additional means of providing management incentives consistent with stockholders’ interests. It can offer further benefits by augmenting a company’s profile among potential new customers and vendors and aid in attracting talented employees.

 

We may seek to complete our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and businesses.

 

 

As of July 31, 2018 we had entered into a Letter of Intent with an unrelated third party. Except for this Letter of Intent, we have not identified any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions with respect to identifying any business combination target. From the date of this prospectus, there have been no communications or discussions between any of our officers or directors and any of their potential contacts or relationships regarding a potential business combination. Additionally, we have not engaged or retained any agent or other representative to identify or locate any suitable acquisition candidate, to conduct any research or take any measures, directly or indirectly, to locate or contact a target business. Accordingly, there is no current basis for investors in this offering to evaluate the possible merits or risks of the target business with which we may ultimately complete our business combination. Although our management will assess the risks inherent in a particular target business with which we may combine, we cannot assure you that this assessment will result in our identifying all risks that a target business may encounter. Furthermore, some of those risks may be outside of our control, meaning that we can do nothing to control or reduce the chances that those risks will adversely impact a target business.

 

We may seek to raise additional funds through a private offering of debt or equity securities in connection with the completion of a business combination. There are no prohibitions on our ability to raise funds privately or through loans in connection with our business combination. At this time, we are not a party to any arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities or otherwise.

 

Sources of target businesses

 

We anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment bankers, private investment funds. Target businesses may be brought to our attention by such unaffiliated sources as a result of being solicited by us through calls or mailings. These sources may also introduce us to target businesses in which they think we may be interested on an unsolicited basis, since many of these sources will have read this prospectus and know what types of businesses we are targeting. Our officers and directors, as well as their affiliates, may also bring to our attention target business candidates that they become aware of through their business contacts as a result of formal or informal inquiries. While we do not presently anticipate engaging the services of professional firms or other individuals that specialize in business acquisitions on any formal basis, we may engage these firms or other individuals in the future, in which event we may pay a finder’s fee, consulting fee or other compensation to be determined in an arm’s length negotiation based on the terms of the transaction. We will engage a finder only to the extent our management determines that the use of a finder may bring opportunities to us that may not otherwise be available to us or if finders approach us on an unsolicited basis with a potential transaction that our management determines is in our best interest to pursue. Payment of finder’s fees is customarily tied to completion of a transaction, in which case any such fee will be paid out of the funds held in the trust account. In no event, however, will our sponsor or any of our existing officers or directors, or any entity with which they are affiliated, be paid any finder’s fee, consulting fee or other compensation prior to, or for any services they render in order to effectuate, the completion of our business combination (regardless of the type of transaction that it is). None of our sponsor, executive officers or directors, or any of their respective affiliates, will be allowed to receive any compensation, finder’s fees or consulting fees from a prospective business combination target in connection with a contemplated acquisition of such target by us. Although some of our officers and directors may enter into employment or consulting agreements with the post-transaction company following our business combination, the presence or absence of any such arrangements will not be used as a criterion in our selection process of an acquisition candidate.

 

We are not prohibited from pursuing a business combination with a business combination target that is affiliated with our officers or directors, or making the acquisition through a joint venture or other form of shared ownership with our officers or directors. In the event we seek to complete our business combination with a business combination target that is affiliated with our executive officers or directors, we, or a committee of independent directors, would obtain an opinion from an independent investment banking firm which is a member of FINRA, that such an business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context.

 

 

In evaluating a prospective target business, we expect to conduct an extensive due diligence review which will encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, as well as a review of financial and other information which will be made available to us.

 

Michel Atlidakis, our sole officer and director, does not have any experience with transactions involving blank check companies.

 

The time required to select and evaluate a target business and to structure and complete our business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. We will not pay any finders or consulting fees to members of our management team, or any of their respective affiliates, for services rendered to or in connection with our business combination.

 

Limited ability to evaluate the target’s management team

 

Although we intend to closely scrutinize the management of a prospective target business when evaluating the desirability of effecting our business combination with that business, our assessment of the target business’ management may not prove to be correct. In addition, the future management may not have the necessary skills, qualifications or abilities to manage a public company. Furthermore, the future role of members of our management team, if any, in the target business cannot presently be stated with any certainty. While it is possible that one or more of our directors will remain associated in some capacity with us following our business combination, it is unlikely that any of them will devote their full efforts to our affairs subsequent to our business combination. Moreover, we cannot assure you that members of our management team will have significant experience or knowledge relating to the operations of the particular target business.

 

We cannot assure you that any of our key personnel will remain in senior management or advisory positions with the combined company. The determination as to whether any of our key personnel will remain with the combined company will be made at the time of our business combination.

 

Following a business combination, we may seek to recruit additional managers to supplement the incumbent management of the target business. We cannot assure you that we will have the ability to recruit additional managers, or that additional managers will have the requisite skills, knowledge or experience necessary to enhance the incumbent management.

 

Competition

 

In identifying, evaluating and selecting a target business for our business combination, we may encounter intense competition from other entities having a business objective similar to ours, including other blank check companies, private equity groups and leveraged buyout funds, and operating businesses seeking strategic acquisitions. Many of these entities are well established and have extensive experience identifying and effecting business combinations directly or through affiliates. Moreover, many of these competitors possess greater financial, technical, human and other resources than us. Our ability to acquire larger target businesses will be limited by our available financial resources. This inherent limitation gives others an advantage in pursuing the acquisition of a target business.

 

Item 1A.  Risk Factors.

 

Not applicable.

 

Item 1B.  Unresolved Staff Comments.

  

Not applicable

 

 

Item 2.  Properties.

 

None.

 

Item 3.  Legal Proceedings.

 

None.

 

Item 4.  Mine Safety Disclosures

 

None.

 

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

 

As of July 31, 2018 there was no market for our common stock.

 

Holders of our common stock are entitled to receive dividends as may be declared by the Board of Directors. Our Board of Directors is not restricted from paying any dividends but is not obligated to declare a dividend. No cash dividends have ever been declared and it is not anticipated that cash dividends will ever be paid.

 

Our Articles of Incorporation authorize our Board of Directors to issue up to 1,000,000 shares of preferred stock. The provisions in the Articles of Incorporation relating to the preferred stock allow our directors to issue preferred stock with multiple votes per share and dividend rights which would have priority over any dividends paid with respect to the holders of our common stock. The issuance of preferred stock with these rights may make the removal of management difficult even if the removal would be considered beneficial to shareholders generally, and will have the effect of limiting shareholder participation in certain transactions such as mergers or tender offers if these transactions are not favored by our management.

 

As of, July 31, 2018 we had 895,750 outstanding shares of common stock which were owned by approximately 40 shareholders of record.

 

Item 6.  Selected Financial Data

 

Not applicable.

 

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

 

We are a “blank check” Company incorporated on August 17, 2005 as a Delaware corporation. We plan to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.

 

Until we complete an acquisition, we may seek to raise additional funds through a private offering of debt or equity to fund our operations, including the costs associated with being a public company. We are not a party to any arrangement or understanding with any third party with respect to raising any additional capital.

 

We have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational activities. We may not generate any operating revenues until after the completion of a business combination. There has been no significant change in our financial condition and no material adverse change has occurred since January 31, 2018. We expect to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

 

As of April 30, 2018 we owed Mr. Atlidakis $41,049 for expenses incurred on our behalf. The amount we owe Mr. Atlidakis is non-interest bearing, unsecured, and due on demand.

 

 

As of April 30, 2018, we did not have any off-balance sheet arrangements and did not have any commitments or contractual obligations.

 

See Note 3 to our audited financial statements for the year ended April 30, 2018 for a description of our critical accounting policies and the potential impact of the adoption of any new accounting pronouncements.

 

Item 7A.  Quantitative and Qualitative Disclosure about Market Risk

 

Not applicable.

 

Item 8.  Financial Statements and Supplementary Data.

 

See the financial statements attached to this

 

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

 

None.

 

Item 9A.  Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

Under the direction and with the participation of the Company’s management, including the Company’s Chief Executive and Chief Financial Officer, the Company has conducted an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures as of April 30, 2018. The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its periodic reports with the Securities and Exchange Commission is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and regulations, and that such information is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Company’s disclosure controls and procedures are designed to provide a reasonable level of assurance of reaching its desired disclosure control objectives. Based on the evaluation, the Chief Executive and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of April 30, 2018.

 

Management’s Report on Internal Control over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934). Management has assessed the effectiveness of our internal control over financial reporting as of April 30, 2018 based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013). As a result of this assessment management concluded that, as of April 30, 2018, our internal control over financial reporting was effective.

 

 Changes in Internal Control over Financial Reporting

 

During the year ended April 30, 2018 there were no changes in the Company’s internal controls that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

Item 9B.  Other Information.

 

None.

 

 

Item 10.  Directors, Executive Officers and Corporate Governance.

 

Name	Age	Position
Michel Atlidakis	52	Chief Executive, Financial and Accounting Officer and a Director

 

The following is a brief summary of the background of our officer and director including his principal occupation during the five preceding years. Directors serve until their successors are elected and qualified or until they are removed.

 

Mr. Atlidakis has been our officer and director since August 2005. Mr. Atlidakis has also been a director of Go Beyond Promotions, Inc. since 2014, a director of Revive Kitchen, Inc. between December 2013 and January 2015 and a director of Tasty Twists, Inc. between December 2013 and January 2015. Between January 2009 and December 2013 Mr. Atlidakis was an independent consultant providing services in the areas of business planning, financing, marketing, and workforce development. Mr. Atlidakis is our promoter, as that term is defined by the Securities and Exchange Commission.

 

We believe that Mr. Atlidakis is qualified to serve as a director due to his experience with development stage companies.

 

Our director is not independent as that term is defined in section 803 of the listing standards of the NYSE MKT. Our director does not qualify as a financial expert as that term is defined by the Securities and Exchange Commission. We do not believe a financial expert is necessary since we did not have any revenues for the year ended April 30, 2018.

 

We have not adopted a Code of Ethics applicable to our principal executive, financial, and accounting officers and persons performing similar functions. We do not believe a Code of Ethics is needed at this time since we have only one officer.

 

We do not have a compensation committee. Our director serves as our audit committee.

 

Directors are elected to hold office until the next annual meeting of shareholders and until their successors have been elected and qualified. Executive officers are elected by the directors and hold office until their resignation or removal by directors.

 

 

Item 11.  Executive Compensation.

 

The following table sets forth in summary form the compensation paid to our officer during the two years ended April 30, 2018.

 

												Stock				Option				All Other
Name and Principal				Salary				Bonus				Awards				Awards				Compensation
Position		Period		(1)				(2)				(3)				(4)				(5)				Total
Michel Atlidakis		2018			--				--				--				--				--				--
Chief Executive, Financial and Accounting Officer		2017			--				--				--				--				--				--

 

We do not have any consulting or employment agreements with any of our officers or directors. None of the proceeds from this offering will be used to pay our officers for compensation which is accrued but unpaid as of the date of this prospectus. As of the date of this prospectus, we have no immediate plans to pay compensation for past services.

 

 

Our board of directors may increase the compensation paid to our officers depending upon a variety of factors, including the results of our future operations.

 

The following table shows the amount which we expect to pay to our executive officer during the twelve months ending July 31, 2019 and the amount of time this officer expects to devote to our business.

   

Name		Projected Compensation				Percentage of Time to be Devoted to Our Operations
Michel Atlidakis			--				10%

 

Stock Options. We have not granted any stock options as of the date of this prospectus. In the future, we may grant stock options to our officers, directors, employees or consultants.

 

Long-Term Incentive Plans. We do not provide our officers or employees with pension, stock appreciation rights, long-term incentive or other plans and have no intention of implementing any of these plans for the foreseeable future.

 

Employee Pension, Profit Sharing or other Retirement Plans.   We do not have a defined benefit, pension plan, profit sharing or other retirement plan, although we may adopt one or more of such plans in the future.

 

Compensation of Directors. Our directors do not receive any compensation pursuant to any standard arrangement for their services as directors. Although our bylaws permit us to pay our directors for attending meetings, we do not compensate our directors for attending meetings.

 

Item 12.  Security Ownership of Certain Beneficial Owners and Management.

 

The following table shows the ownership, as of July 31, 2018, of those persons owning beneficially 5% or more of our common stock and the number and percentage of outstanding shares owned by each of our directors and officers and by all officers and directors as a group. Each owner has sole voting and investment power over their shares of common stock.

 

Name		Shares Owned				% of Outstanding Shares
Michel Atlidakis			556,625				62%
All officers and directors as a group (1 person)			556,625				62%

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

 

As at April 30, 2018 and 2017, we were indebted to Michel Atlidakis, our sole officer and director, for $41,049 and $18,021, respectively, for expenses incurred on our behalf. The amounts are non-interest bearing, unsecured, and due on demand.

 

 

Item 14.  Principal Accountant Fees and Services.

 

Paritz & Company, P.A. was our principal accountant for the two years ended April 30, 2018.  The following shows the fees we paid Paritz & Company, P.A. during the two years ended April 30, 2018.

 

		2018				2017
Audit Fees		$	5,500			$	5,000
Audit-Related Fees		$	–			$	–
Tax Fees		$	–			$	–

 

Audit fees represent amounts billed for professional services rendered for the audit of our annual financial statements and reviews of our quarterly financial statements.

 

Audit-related fees represent amounts billed for consents related to regulatory filings, audit/review of financial statements included in our registration statements filed with the Securities and Exchange Commission, and consulting related to the implementation of accounting standards.

 

 

Item 15.  Exhibits and Financial Statement Schedules.

 

The following exhibits are filed with this Form 10-K or incorporated by references:

 

Exhibit No.		Description
3.1		Certificate of Incorporation, as amended. (1)
3.2		Bylaws (1)
4.1		Designation of Series A Preferred Stock (1)
31.1		Certification by the Principal Executive Officer
31.2		Certification by the Principal Financial Officer
32.1		Certifications by the Principal Executive and Financial Officers
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.

 

(1)	Incorporated by reference from Amendment No. 1 to our registration statement on Form S-1 filed April 24, 2017.

 

 

The Diamond Cartel Inc.

 

April 30, 2018 and 2017

	Index
Reports of Independent Registered Public Accounting Firm	F–1
Balance Sheets as of April 30, 2018 and 2017	F–2
Statements of Operations for the years ended April 30, 2018 and 2017	F–3
Statements of Stockholders’ Deficit for the years ended April 30, 2018 and 2017	F–4
Statements of Cash Flows for the years ended April 30, 2018 and 2017	F–5
Notes to the Financial Statements	F–6

     

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To the Board of Directors and
Stockholders of The Diamond Cartel, Inc.

London, Ontario, Canada

 

Opinion on the Financial Statements

 

We have audited the accompanying balance sheets of The Diamond Cartel, Inc. (the Company) as of April 30, 2018 and 2017, and the related statements of operations, statement of stockholders’ deficit and cash flows for the years then ended, 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 April 30, 2018 and 2017, and the results of its operations and its cash flows for years then ended, in conformity with accounting principles generally accepted in the United States of America.

 

 

Going Concern Matter

 

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As disclosed in Note 2 to the financial statement the Company has not generated any revenues since inception. As of April 30, 2018, the Company has a working capital deficiency of $524,201. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. Management plans regarding these matters are also disclosed in note 2. The 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/Paritz & Company, P.A.

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

Hackensack, NJ

August 10, 2018

 

 

The Diamond Cartel Inc.

Balance Sheets

 

 

 

 

The Diamond Cartel Inc.

Statements of Operations

 

 

 

 

The Diamond Cartel Inc.

Statements of Stockholders’ Deficit

 

 

 

 

The Diamond Cartel Inc.

Statements of Cash Flows 

 

 

 

 

 

 

 

 

 

 

 

 

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, thereunto duly authorized.

 

	THE DIAMOND CARTEL, INC.
Dated: August 10, 2018	By:	/s/Michel Atlidakis
		Michel Atlidakis
		Principal Executive Officer

 

Pursuant to the requirements of the Securities Exchange Act of l934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

 

Signature		Title		Date
/s/Michel Atlidakis
Michel Atlidakis		Principal Executive, Financial and Accounting Officer and a Director		August 10, 2018