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EX-31 - SATUSA Corpsatusaex31.txt
EX-32 - SATUSA Corpexh32.txt

                                  UNITED STATES
                             WASHINGTON, D.C. 20549

                                    FORM 10-K
                       THE SECURUTIES EXCHANGE ACT OF 1934

                  For the fiscal year ended August 31, 2018

                        Commission file number 333-162824

                               SATUSA CORPORATION
             (Exact Name of Registrant as Specified in Its Charter)

        Nevada                                             27-0265042
(State or Other Jurisdiction of                         (I.R.S. Employer
 Incorporation or Organization)                         Identification No.)

                               5348 Vegas Drive
                              Las Vegas, NV 89108
               (Address of Principal Executive Offices & Zip Code)

                             Mr. Jeffrey Nichols, Esq
                               SATUSA CORPORATION
                                 811 6th Avenue
                               Lewiston, ID 83501
            (Name, Address and Telephone Number of Agent for Service)

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

           Securities registered pursuant to section 12(g) of the Act:
                          Common Stock, $.0001 par value

Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes [ ] 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 [ ] 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 past 90 days. Yes [X] 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
(ss.232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such
files). Yes [ ] No [ ]

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

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

Large accelerated filer [ ]                    Accelerated filer [ ]
Non-accelerated filer   [ ]                    Smaller reporting company [X]
Emerging Growth Company [X]

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

As of August 31, 2018 the registrant had 12,400,000 shares of common stock
issued and outstanding. No market value has been computed based upon the fact
that no active trading market had been established as of August 31, 2018.


SATUSA CORPORATION TABLE OF CONTENTS Page No. -------- Part I Item 1. Business 4 Item 1A. Risk Factors 9 Item 2. Properties 10 Item 3. Legal Proceedings 10 Item 4. Submission of Matters to a Vote of Securities Holders 10 Part II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 11 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 11 Item 8. Financial Statements and Supplementary Data 14 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 24 Item 9A. Controls and Procedures 24 Part III Item 10. Directors and Executive Officers 27 Item 11. Executive Compensation 29 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 30 Item 13. Certain Relationships and Related Transactions 30 Item 14. Principal Accounting Fees and Services 31 Part IV Item 15. Exhibits 31 Signatures 31 -3-
PART I ITEM 1. BUSINESS SATUSA CORPORATION ("SATUSA," the "Company," "we," "us,") - formerly Essense Water, Inc. - is presently seeking to develop, market, and operate an SAT- exam preparatory program. The SAT exam is a widely-used, standardized test for college admissions in the U.S. The Company has been developing its proprietary teaching methods and techniques and has been correlating them to work together with and enhance student scores on the recently revised SAT exam. The SAT exam is owned, published, and administered by the College Board, a private not-for-profit corporation. We are presently operating our program within the greater Spokane, WA area. In 2019, the Company plans to expand and add classes in North Idaho and the Seattle areas. However, our primary goal and focus is continue to market and promote our prep course to others looking to utilize these resources throughout the northwest, west coast, and within the entire U.S. GENERAL INFORMATION Industry Overview In North America, private tutoring and test preparation grew to a $20 billion industry in 2014, up from $7 billion in 2006 (according to Global Industry Analysts, Inc., a forecasting firm based in San Jose, CA). These North American revenues are projected to reach $22.5 billion in 2020. Similarly, on a global basis, test prep and tutoring generated $114 billion in revenues in 2014, up from $59 billion in 2006. By 2020, these revenues are forecasted to be approaching $200 billion. This tremendous increase in demand has been fueled by the intense desire of parents to see their children gain an edge in the classroom, coupled with the very competitive nature and importance of college admissions. The SAT exam has been the "standard" for college admissions since the 1920's. Its test format had been relatively unchanged since then, until about three years ago when College Board announced they were making the first sweeping changes to the actual test. This resulted in increased anxiety for college- bound high school students and their parents. Debuted in March of 2016, the revised SAT exam is the culmination of two-year focused effort by College Board. Designing the new exam to be even "more demanding" and to "better test students on what they will probably encounter in college" by College Board has meant greater demand for tutoring/prep within the industry. This revised exam presented an opportunity for SATUSA to redesign and realign the Company's own already successful curriculum in a way that allows it to become a far-reaching business opportunity to expand beyond our current geographic boundaries and take the program to the entire U.S. -4-
Our Product The founder of the Company has designed and taught his own SAT prep class for many years to local area students. In doing so, he has learned what works and what does not, and has been continually refining his program and related curriculum accordingly. While there are numerous practice books and various teaching methodologies taught by many publishers, such as College Board, Barrons, and Princeton Review, and classes taught by Kaplan, Sylvan Learning, and others, the founder has found that there is no one teaching in the same manner that his curriculum draws upon. Results are what count, and he has a multi-year track record of impressive results as evidence of his proprietary teaching methods. With the new SAT test coming to market in March 2016, he saw the opportunity to rewrite his present curricula and revise his teaching materials and practice tests in a way that would allow the Company to not only expand within its own geographic area but, more importantly, allow them to expand the program, through franchise, partnership, or other means, to areas throughout the U.S. and possibly other countries. His proprietary approach was very successful in raising students' scores on the old exam, and has been proven to as equally effective with the new SAT exam. Many students have seen increases in their SAT scores of over 400 points, while most can regularly achieve 150-250 point increases after attending the course. Our Primary Markets The Company targets high school students and those parents seeking to increase students' scores on the SAT exam. Greater SAT scores open the doors to many more college choice opportunities, and regularly result in very sizable scholarships and grants, an effective way to offset the ever- increasing cost of a college degree. There continues to be little to no effort being put forth in the public and private school systems in preparing their students for this most important college-entrance exam. For those self-motivated students, there are many means by which to learn and train on their own, whether through test-prep books or online classes. There are also numerous short-term "boot-camps" to help familiarize students with the exam. For most though, SATUSA's intensive hands-on training and the focused classroom environment of its program provides that extra level of reinforcement and commitment for students to get substantial score improvement. Every student learns at different rates and has various strengths and weaknesses. By keeping SATUSA's class sizes to a maximum of 12-15 students, we are able to work with the individual student in a way that helps them see what they need to learn and focus on to best maximize their scores. Our Company is located in Spokane, Washington, and will be expanding to serve the North Idaho and Seattle markets beginning in 2019. While Spokane has been our primary market, we are looking beyond the North Idaho and Seattle markets as we seek to further expand its classroom and teaching presence. -5-
Distribution, Sales, and Marketing The Company itself plans to directly promote, market, and expand their market area as it begins growing outside the afore-mentioned primary markets. We see three possible means for expansion of our Company - some form of a teaching partnership with local teaching groups or individuals, franchising, and possibly internet/web-based programs. In setting up teaching partnerships, the Company would look to recruit local instructors, help them with how to teach the class program, provide teaching materials, and even teach/oversee a few classes to help get them started. In this situation, the Company foresees either paying the instructor(s) to teach the classes, or possibly do some form of a partnership arrangement in which the instructors share more directly in the success of the program that they would be in charge of. As earlier stated, we are expanding our territory in 2019 to North Idaho and Seattle markets. We are also looking at the Tri-Cities area in south central Washington, further penetration within the Seattle metropolitan market, and Portland. These are the more natural and easier markets for our immediate expansion efforts due to the relatively close nature that allow easier training of the teachers. The Company feels that its program provides a great opportunity as a franchise. The founder has a great deal of proprietary information, teaching methods, and curriculum that he has compiled which he readily uses in his classroom teachings. These have already been put into a training materials format and can now be licensed to qualified instructors/groups in areas throughout the U.S. In this franchise scenario, the Company envisions an upfront cost to buy the franchise and then an ongoing royalty from the revenues that the various franchisees are able to produce. The third opportunity that we considering would be to produce and offer our prep course directly to consumers via the Internet through a focused training/teaching website. This program could either have "live" streams with students from all over, or have class sessions produced and recorded that students could access and "attend" on their own. Competition The test prep and tutoring industry is extremely competitive, as evidenced by the tremendous growth over the past few years, and also by the projected increases, both in the U.S and globally in total market size. The primary areas of competition include pricing, timing of the classes throughout the year, tutors, curriculum, and marketing campaigns. -6-
The Company's product competes directly with a wide range of prep programs and classes promoted by a relatively large number of companies. Many of these have enjoyed broad, well-established national recognition for years, through well-funded advertising and other marketing campaigns, as well as detailed and complex study materials/books. Many of the companies have far greater financial, marketing, and distribution resources than the Company has. Important factors that will affect our ability to compete successfully include the proven and long-standing history of the Company's proprietary program. It was designed to offer students the best chance of increasing their test scores by steadily building on its proven fundamentals and teaching students how to counteract the trickiness and difficulties presented in the SAT exam. It also is designed to take the students, from a timing standpoint, right up and through the exams, as opposed poorly-timed or shorter courses in which the teachings are soon forgot once the class ends. The Company will also be competing to secure tutors and others who must see the benefit and opportunity of the Company's prep course over the many others that are available. Environmental Matters There are no environmental concerns for the Company. BANKRUPTCY OR SIMILAR PROCEEDINGS There has been no bankruptcy, receivership, or similar proceeding. REORGANIZATIONS, PURCHASE, OR SALE OF ASSETS There have been no material reclassifications, mergers, consolidations, or purchase or sale of a significant amount of assets not in the ordinary course of business. COMPLIANCE WITH GOVERNMENT REGULATION The Company, based on its understanding and reviews of government and other regulations, is not aware of any non-compliance or other matters in this respect. It will be our policy to comply with any and all requisite legal requirements. Compliance with these provisions has not had, and we do not expect such compliance to have, any material adverse effect on our capital expenditures, net income, or competitive position. PATENTS, TRADEMARKS, FRANCHISES, ROYALTY AGREEMENTS OR LABOR CONTRACTS As stated earlier, the Company is looking to possibly franchise the business opportunity and provide training and program materials to other parties that may be interested in providing similar SAT prep services. It's a great opportunity for teachers, home-schoolers, or others to provide a valuable service and make a very nice primary or secondary income in doing so. -7-
In establishing a franchise possibility, we may also see the need for copyright and royalty agreements. We will seek the proper counsel, if and when the needs for such services arise. At present, we have no current plans for any registrations such as concessions, or labor contracts. We will continue to assess the need for any such applications on an ongoing basis as the Company furthers with its business plan and seeks to expand out of its current market area. NEED FOR GOVERNMENT APPROVAL OF PRODUCTS OR SERVICES We are not required to apply for or have any government approval for our products or services during this phase of our business plan. Prior to the Company's expansion and or change in operations, all such approvals necessary will be researched, applied for, and received. RESEARCH AND DEVELOPMENT COSTS DURING THE LAST TWO YEARS We have expended approximately $1,000 in funds for research and development costs incurred by our founder over past two years. At the present time, most all development costs are related to the founder putting his teaching methodology(s) in place, designing and completing the teaching materials and curriculum as the Company seeks to expand. There are minimal costs in his doing so. EMPLOYEES AND EMPLOYMENT AGREEMENTS Our only employee is our sole officer and director, Kevin Nichols. Mr. Nichols currently devotes ten to twenty hours per week to Company matters and, if necessary, will devote as much time as is necessary to manage the affairs of the Company. There are no formal employment agreements between the Company and our current employee. REPORTS TO SECURITIES HOLDERS We will provide an annual report that includes audited financial information to our shareholders. We make our financial information equally available to any interested parties or investors through compliance with the disclosure rules of the Securities Exchange Act of 1934, including filing Form 10K annually and Form 10Q quarterly. In addition, we will file Form 8K and other proxy and information statements from time to time as required. We do not intend to voluntarily file the above reports in the event that our obligation to file such reports is suspended under the Exchange Act. The public may read and copy any materials that we file with the Securities and Exchange Commission, ("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, proxy and information statements, and other information regarding issuers that file electronically with the SEC. -8-
ITEM 1A. RISK FACTORS UNTIL RECENTLY, OUR AUDITORS HAVE ISSUED A GOING CONCERN OPINION, THEREFORE THERE IS SUBSTANTIAL UNCERTAINTY WE WILL CONTINUE ACTIVITIES IN WHICH CASE YOU COULD LOSE YOUR INVESTMENT. Until recently, our auditors have issued a "going concern" opinion. This means that there has been substantial doubt that we can continue as an ongoing business for the next twelve months. Although the Company has begun to produce steady revenues with its new business direction, it has yet to be seen if this can be maintained and increased in the longer term. WE LACK AN OPERATING HISTORY AND HAVE PRODUCED LOSSES WHICH MAY NOT CONTINUE INTO THE FUTURE. AS A RESULT, WE MAY HAVE TO SUSPEND OR CEASE ACTIVITIES. We were incorporated in January 2009 and we have minimally started our originally-proposed business activities. With its new business strategy and direction, the Company does not yet have a long-standing history of regular revenue production. We have limited operating history upon which an evaluation of our future success or failure can be made. Our net loss was $66,483 from inception to August 31, 2015, as we progressed with the Company's original business plan. For our most recent year, our new business model has produced Total Revenues of $44,089 (versus $48,846 fr last fiscal year) and Net Income of $19,541 (versus $24,271 for last year). Our ability to achieve and maintain profitability and positive cash flow is dependent upon: * our ability to promote our prep course * our ability to generate revenues * our ability to manage development costs and expenses Failure to generate sufficient continued revenues may cause us to suspend or cease activities. WE WILL HAVE TO SPEND ADDITIONAL FUNDS TO FURTHER DEVELOP, MARKET, AND OPERATE OUR SAT PREP COURSE, AND THEN EVEN MORE TO MARKET AND EXPAND IT. IF WE CAN'T RAISE SUFFICIENT WORKING CAPITAL WE MAY HAVE TO CEASE OPERATIONS AND YOU COULD LOSE YOUR INVESTMENT. Even after we successfully complete the development of our prep program, we will have to spend substantial funds on our marketing and sales efforts before we will know if we have a commercially viable and marketable/sellable product as we expand outside of our primary market area. BECAUSE WE ARE SMALL AND DO NOT HAVE MUCH CAPITAL, WE MAY HAVE TO LIMIT OUR DEVELOPMENT/MARKETING/EXPANSION/SALES ACTIVITIES WHICH MAY RESULT IN A LOSS OF YOUR INVESTMENT. Because we are small and do not have much capital, we must limit our product development, marketing, and sales activities. As such we may not be able to complete a product and business development program that is as thorough as we would like. If this becomes a reality, we may never generate sufficient revenues and you may lose your investment. -9-
BECAUSE OUR SOLE OFFICER AND DIRECTOR HAS OTHER OUTSIDE BUSINESS ACTIVITIES AND WILL ONLY BE DEVOTING 20%-30% OF HIS TIME, APPROXIMATELY TEN TO TWENTY HOURS PER WEEK, TO OUR OPERATIONS, OUR OPERATIONS MAY BE SPORADIC WHICH MAY RESULT IN PERIODIC INTERRUPTIONS OR SUSPENSIONS OF BUSINESS DEVELOPMENT. Because our sole officer and director has other outside business activities and will only be devoting limited amounts of his time to our development and operations, completion of these steps of our business plan may be sporadic and occur at times which are convenient to our officer and director. As a result, development of our product and its marketing and sale may be periodically interrupted or suspended. OUR STOCK WILL BE CONSIDERED PENNY STOCK WHICH LIMITS AN INVESTORS' ABILITY TO SELL THE STOCK. Our shares will constitute "penny stock" under the Exchange Act. The shares will remain penny stock for the foreseeable future. The classification of penny stock makes it more difficult for any broker-dealer to sell the stock into a secondary market, thus limiting investment liquidity. Any broker- dealer engaged by a purchaser for the purpose of selling his or her shares in our Company will be subject to Rules 15g-1 through 15g-10 of the Exchange Act. Rather than creating a need to comply with those rules, some broker- dealers will refuse to attempt to sell penny stock. ITEM 2. PROPERTIES The Company presently owns no real estate property. As a corporate presence, it presently utilizes the office of our sole officer and director, Kevin Nichols, who makes this space available to the Company free of charge. His office is located in Spokane, Washington. The office provides use of computer, phone, printer, and a fax machine and its general character is adequate to provide sufficient space and resources for the Company's business development. At present, the actual classroom teachings are held in classrooms at local churches and community centers which generally make the space available without any formal agreement and minimal charges. The Company has given the church stipends, for its gratitude in providing the teaching space, ranging from $500 to $1,000 per year. Mr. Nichols also has an adequate amount of storage capacity within his home, in excess of 100 square feet, which can be made available as might be needed. We currently have no investment policies as they pertain to real estate, real estate interests, or real estate mortgages. ITEM 3. LEGAL PROCEEDINGS We are not currently involved in any legal proceedings and we are not aware of any pending or potential legal actions. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS There were no matters submitted to a vote of the security holders during the year ended August 31, 2018. -10-
PART II ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS We are not listed or traded on any exchange. We have not had any active trading in our stock as of the date of this report. As of August 31, 2018, there were forty-three (43) shareholders of record holding a total of 12,400,000 shares of the Company's common stock. The holders of common stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders. Holders of the common stock have no pre-emptive rights and no right to convert their common stock into any other securities. There are no redemption or sinking fund provisions applicable to the common stock. We have not paid, nor declared, any dividends since our inception and do not intend to declare any such dividends in the foreseeable future. Our ability to pay dividends is subject to limitations imposed by Nevada law. Under Nevada law, dividends may be paid to the extent that a corporation's assets exceed its liabilities and it is able to pay its debts as they become due in the usual course of business. REPORTS We are subject to certain filing requirements and will furnish annual financial reports to our stockholders, certified by our independent accountant, and will furnish un-audited quarterly financial reports in our quarterly reports filed electronically with the Securities and Exchange Commission. All reports and information filed by us can be found at their website, TRANSFER AGENT The Company has yet to appoint a Transfer Agent. We will do so when and as it may be required in the furtherance of the business plan. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS From inception through the yearend of August 31, 2015, the Company had produced no revenues. In early calendar 2016, the Company abandoned its original business plan and brought in the new SAT prep business strategy. As a result, it has since produced Operating Revenues from the SAT program of $44,089 and $48,846 for the years ended August 31, 2018 and 2017, respectively. Net Income in our most recent year totaled $19,541 versus $24,440 for the prior fiscal year. -11-
We incurred Total Expenses of $20,176 for the year ended August 31, 2018, while incurring Total Expenses of $20,036 for the prior year. These expenses consisted of the costs of teaching the classes, including books, printing and supplies, and general operating expenses incurred primarily in maintaining our corporate status, product development, accounting services, and the preparation and filing of our ongoing periodic reports. In May, 2009, a total of 12,000,000 shares of common stock were issued in exchange for $2,000, or approximately $.00017 per share. These securities were issued to Kevin Nichols, the sole officer and director of the Company. In June, 2012 the Company received approval from the SEC to begin selling common shares by way of an S-1 Offering. The Company sold a total of 400,000 of its common shares through this Offering, which ended at the end of June 2013, for total proceeds of $10,000. The following table provides selected financial data about our Company for the period ended August 31, 2018. Balance Sheet Data: 8/31/18 ------------------- ------- Cash $ 10,705 Total Assets $ 14,825 Total Liabilities $ 5,690 Shareholders' Deficit $ 9,135 Until three years ago, our auditors expressed their doubt about our ability to continue as a "going concern" unless we are able to raise additional capital and ultimately generate profitable operations. For the past three years, the Company received a "clean" opinion, based on the profitable nature of the Company since it changed business direction and adopted its SAT prep strategy. LIQUIDITY AND CAPITAL RESOURCES Our cash balance at August 31, 2018 was $10,705. This amount, coupled with the expected cash flow for the year is considered adequate to provide for our projected expansions to North Idaho and the Seattle areas. In the early years after inception, the Company largely survived on funds provided by our sole officer and director, Kevin Nichols, who has agreed to advance funds for operations, if needed. However, there is no formal commitment, arrangement, or legal obligation to advance or loan funds to the Company. He Company has been using its excess cash flows to pay down the prior amounts advanced by Mr. Nichols and will most likely continue to do so. -12-
PLAN OF OPERATION This section includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this prospectus. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or any of our predictions. The Company believes that it will be able to continue its positive operating cash flows from the SAT prep class teachings, but should the Company require additional cash from sources other than operations, it will be able to get advances from the founder. Should the Company need additional capital in the form of private equity, debt, or some combination thereof in order to fully complete and achieve the optimal level with our business plan, our founder has experience in finding such parties to do so. We intend to accomplish the foregoing and will measure our accomplishment through the following milestones: 1. Continue with and expand our local area SAT prep program. This is what has provided the Company's operating revenues over the past three years. The Company has met with success and is achieving great results from students with the new curriculum that it has put together for teaching the newly revised SAT exam. 2. Expand the local area programs through a series of meetings with area high school administrators, homeschool co-ops, and private schools. Use this to promote what we do, share the results of the SAT prep program, and provide a means for them to consider how the Company may help them achieve better test results for more of their students. 3. As we progress with the above milestones, we will also be further enhancing our curriculum, class materials, and lesson plans with an eye towards making them available for use and teaching by others as we expand our footprint outside the local market area. 4. Look at and meet with representatives within the outlying communities that might be interested in sponsoring or putting together programs for their local students. This will include our planned expansions within and to other communities in western Washington and north Idaho that are within distance of a few hour commute. 5. Design and establish a better website/presence that will allow us to market not only to local communities but also to areas in which we look to expand. As this website is enhanced, the Company will keep an eye towards making it one that can be copied by partners or franchisees and used by them in their local areas. We will also keep an eye towards how we may use it to offer online classes, training, and other resources. -13-
6. Analyze and assess larger markets outside the local areas, such as Portland, Boise, Salt Lake City, etc. to get an idea of how our program would best fit in those markets. Make contacts within those various school districts for interest levels and also for possible tutors that could teach the program in those markets. 7. Research, assess, and pursue how to best expand on a much larger basis throughout the U.S. This would include the "franchising" of the business model and/or through partnerships. 8. Design and prototype video classes that can be established/published via our web-site for students outside our immediate market area. 8. Research and pursue the means by which the Company could reach outside the U.S. market to various tutoring groups/companies seeking to enhance their operations by offering hands-on training in the U.S. We have been approached by a couple of groups from Asia (China and Korea) that have expressed a desire to facilitate and teach groups of students that would come to the U.S. for intensive hands-on training of the SAT. OFF-BALANCE SHEET ARRANGEMENTS We have no off-balance sheet arrangements. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The Auditors' Reports - for fiscal 2018 and 2017 - and our audited financial statements for the fiscal years ended August 31, 2018 and 2017 immediately follow. -14-
Report of Independent Registered Public Accounting Firm Report of Independent Registered Public Accounting Firm To the shareholders and the board of directors of SATUSA Corporation Opinion on the Financial Statements We have audited the accompanying balance sheets of SATUSA Corporation (the "Company") as of August 31, 2018 and 2017, the related statements of operations, stockholders' equity (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 August 31, 2018 and 2017, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States. 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 audit. 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 audit 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. Our audit 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 audit 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 audit provides a reasonable basis for our opinion. /s/ BF Borgers CPA PC BF Borgers CPA PC1 We have served as the Company's auditor since 2016 Lakewood, CO November 14, 2018 -15-
SATUSA CORPORATION Balance Sheets ----------------------------------------------------------------------------- As of As of August 31, August 31, 2018 2017 -------- -------- ASSETS CURRENT ASSETS Cash $ 10,705 $ 67,662 Accounts Receivable 4,120 4,891 -------- -------- 11 -------- -------- TOTAL ASSETS $ 14,825 $ 72,553 ======== ======== LIABILITIES & STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts Payable and Accrued Liabilities $ 3,780 $ 4,320 Payable to Affiliates 1,910 78,639 -------- -------- TOTAL CURRENT LIABILITIES 5,690 82,959 -------- -------- TOTAL LIABILITIES 5,690 82,959 -------- -------- STOCKHOLDERS' EQUITY Common stock, ($0.0001 par value, 75,000,000 shares authorized; 12,400,000 shares issued and outstanding as of August 31, 2018 and 2017, respectively) 1,240 1,240 Additional paid-in capital 10,760 10,760 Deficit accumulated during development stage (2,865) (22,406) -------- -------- TOTAL STOCKHOLDERS' EQUITY 9,135 (10,406) -------- -------- TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 14,825 $ 72,553 ======== ======== The accompanying notes are an integral part of these Financial Statements. -16-
SATUSA CORPORATION Statements of Operations ----------------------------------------------------------------------------- Year Ended Year Ended August 31, August 31, 2018 2017 ---------- ---------- Operating Revenue $ 44,089 $ 48,846 ---------- ---------- Total Revenue 44,089 48,846 Cost of Services (4,372) (4,370) ---------- ---------- Gross Profit 39,717 44,476 Expenses General and Administrative 20,176 20,036 ---------- ---------- Total Expenses 20,176 20,036 ---------- ---------- NET INCOME (LOSS) $ 19,541 $ 24,440 ========== ========== BASIC EARNINGS (LOSS) PER SHARE $ 0.00 $ 0.00 ========== ========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 12,400,000 12,400,000 ========== ========== The accompanying notes are an integral part of these Financial Statements. -17-
SATUSA CORPORATION Statement of Stockholders' Equity From August 31, 2013 through August 31, 2018 ----------------------------------------------------------------------------- Deficit Accumulated Common Additional During Common Stock Paid-in Development Stock Amount Capital Stage Total ----- ------ ------- ---------- ------ BALANCE, AUGUST 31, 2013 12,400,000 $ 1,240 $10,760 $ (46,018) $(34,018) ========== ======= ======= ========= ======== Net loss, August 31, 2014 (9,960) (9,960) ---------- ------- ------- ---------- ------- BALANCE, AUGUST 31, 2014 12,400,000 $ 1,240 $10,760 $ (55,979) $(43,979) ========== ======= ======= ========= ======== Net loss, August 31, 2015 (10,504) (10,504) ---------- ------- ------- ---------- ------- BALANCE, AUGUST 31, 2015 12,400,000 $ 1,240 $10,760 $ (66,483) $(54,483) ========== ======= ======= ========= ======== Net Income, August 31, 2016 19,636 19,636 ---------- ------- ------- ---------- ------- BALANCE, AUGUST 31, 2016 12,400,000 $ 1,240 $10,760 $ (46,846) $(34,847) ========== ======= ======= ========= ======== Net Income, August 31, 2017 24,440 24,440 ---------- ------- ------- ---------- ------- BALANCE, AUGUST 31, 2017 12,400,000 $ 1,240 $10,760 $ (22,406) $(10,406) ========== ======= ======= ========= ======== Net Income, August 31, 2018 19,541 19,541 ---------- ------- ------- ---------- ------- BALANCE, AUGUST 31, 2018 12,400,000 $ 1,240 $10,760 $ (2,865) $ 9,135 ========== ======= ======= ========= ======== The accompanying notes are an integral part of these Financial Statements. -18-
SATUSA CORPORATION Statements of Cash Flows ----------------------------------------------------------------------------- Year Ended Year Ended August 31, August 31, 2018 2017 ---------- ---------- OPERATING ACTIVITIES Net Income (Loss) $ 19,541 $ 24,440 Net Change in Accounts Receivable 771 (241) Net Change in Accounts Payable (540) (1,430) -------- -------- NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 19,772 22,769 FINANCING ACTIVITIES Net Advances from(to) Affiliate (76,729) 44,141 -------- -------- NET CASH FLOWS PROVIDED BY FINANCING ACTIVITIES (76,729) 44,141 -------- -------- NET INCREASE (DECREASE) IN CASH (56,957) 66,910 CASH AT BEGINNING OF PERIOD 67,662 752 -------- -------- CASH AT END OF PERIOD $ 10,705 $ 67,662 ======== ======== SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cash paid during period for: Interest $ -- $ -- ======== ======== Income Taxes $ -- $ -- ======== ======== The accompanying notes are an integral part of these Financial Statements. -19-
SATUSA CORPORATION Notes to Financial Statements August 31, 2018 ----------------------------------------------------------------------------- NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS Essense Water, Inc. (the "Company"), was incorporated on January 29, 2009, under the laws of the State of Nevada. During the 3rd quarter of fiscal year 2016, The Company adopted a new business plan consisting of the development and implementation of an SAT-exam preparatory program/course. In doing so, the Company also changed its name to SATUSA to more closely align it with the new business plan. The Company has elected a fiscal year end of August 31. The Company's authorized share capital consists of 75,000,000 shares of common stock, $0.0001 par value per share. At August 31, 2018 and 2017, the Company had 12,400,000 shares of its common stock issued and outstanding, respectively. NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. BASIS OF ACCOUNTING The Company's financial statements are prepared using the accrual method of accounting. The basis of accounting conforms to Accounting Principles generally accepted in the United States of America ("US GAAP"). The Company has elected an August 31 year end. B. EARNINGS PER SHARE ASC No. 260, "Earnings Per Share", specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock. The Company has adopted the provisions of ASC No. 260. Basic net loss per share amounts is computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted earnings per share are the same as basic earnings per share due to the lack of dilutive items, such as options or warrants, in the Company. C. CASH EQUIVALENTS The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. D. USE OF ESTIMATES AND ASSUMPTIONS The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. All adjustments are normal and recurring. -20-
E. INCOME TAXES Income taxes are provided in accordance with ASC No. 740, Accounting for Income Taxes. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carryforwards. Deferred tax expense (benefit) results from the net change during the year of deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of all of the deferred tax assets will be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company has not recorded any reserves for uncertain income tax positions. F. REVENUE RECOGNITION The Company recognizes revenue pursuant to revenue recognition principles presented in SAB Topic 13. First, persuasive evidence of an arrangement, second, delivery has occurred and/or services have been rendered, thirdly the seller's price to the buyer is fixed or determinable and lastly collectability is reasonably assured. The Company's revenue was mainly derived from one source: Teaching services income/revenues are earned by the Company in return for delivering classroom and other services related to the teaching(s) of their proprietary SAT Preparation course. These revenues are billed monthly and paid by client, and as such are initially recorded as an asset with an offsetting earned revenue. The value of the revenue earned is recognized based upon the classroom attendance by the student against the pre-set charge for each class. This revenue is recognized in the month that services were provided. By recognizing the revenue in this manner, the Company is following the guidelines of FASB ASC 605 and SAB Topic 13, in that the Company is only recognizing revenue once the value of the revenue received is fixed and determinable. In addition, the Company is applying the definition of readily determinable fair value presented at Accounting Standards Codification 820- 10-15-5 in assessing the amount to recognize in each accounting period. The revenue is recognized as revenue in the period the services were delivered. The Company is finalizing the implementation of ASC 606 revenue recognition and expecting no significant financial impact on company's financial statements. G. ACCOUNTS RECEIVABLE The Company has had a history of collecting the full amount of their receivables. As a result, they have provided no allowance or reserves for doubtful accounts. H. ADVERTISING The Company will expense its advertising when incurred. There have been no advertising costs since inception. -21-
I. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS The Company has reviewed the recently issued accounting pronouncements relating to the treatment and recording of certain accounting transactions and has determined that there are none that would materially impact or effect these financial statements. NOTE 3. GOING CONCERN The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company's activities for the past two years have produced regular net income and positive cash flows. These positive results are expected to continue in the future. In addition, the founder has agreed to and does not plan to draw on the amount due him in a manner that would negatively impact the Company's financial position. However, there can be no assurances that the Company will be able to accomplish these plans. NOTE 4. WARRANTS AND OPTIONS There are no warrants or options outstanding to acquire any additional shares of common stock. NOTE 5. RELATED PARTY TRANSACTIONS The Company's sole Officer and Director has advanced/loaned the Company funds and has paid certain third-party expenses on behalf of the Company. As of August 31, 2018 and 2017, the net amounts owing the sole officer and director were $1,910 and $78,639, respectively. These amounts are payable on demand and are non-interest bearing. During 2018, the officer advanced funds and paid expenses on the Company's behalf totaling $4,168 and the Company made payments to the officer totaling $80,898. The Company's sole officer and director has received and is owed no salary. The Company neither owns nor leases any real or personal property. The sole officer and director of the Company is involved in other business activities and may, in the future, become involved in other business opportunities as they become available. Thus he may face a conflict in selecting between the Company and his other business interests. The Company has not formulated a policy for the resolution of such conflicts. -22-
NOTE 6. INCOME TAXES As of August 31, 2018 2017 ------ ------ Deferred tax assets: Net operating loss carryforwards $ 3,035 $ 22,576 Tax Rate 21% 21% ------ ------ Gross deferred tax assets 637 4,741 Valuation allowance (637) (4,741) ------ ------ Net deferred tax assets $ 0 $ 0 ====== ====== Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carryforwards are expected to be available to reduce taxable income. As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance. NOTE 7. STOCK TRANSACTIONS The stockholders' equity section of the Company contains the following classes of capital stock as of August 31, 2018 and 2017: Common stock, $0.0001 par value: 75,000,000 shares authorized; 12,400,000 shares issued and outstanding as of August 31, 2018 and 2017, respectively. On May 29, 2009 the Company issued a total of 12,000,000 shares of common stock to its sole officer/director for cash at $0.00017 per share for total proceeds of $2,000. During the fiscal year 2013, the Company sold and issued a total of 400,000 shares of common stock to various investors for cash at $0.025 per share for total proceeds of $10,000. NOTE 8. SUBSEQUENT EVENTS The Company has evaluated subsequent events through the date that the financial statements were issued, and determined there are no other subsequent events to be reported. -23-
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON FINANCIAL DISCLOSURE Further, there have been no disagreements between the Company and our independent public accounting firm, B F Borgers CPA PC, as to any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure. ITEM 9A. CONTROLS AND PROCEDURES EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES Under the supervision and with the participation of our management, including our principal executive officer and the principal financial officer (our President), we have 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 Securities and Exchange Act of 1934, as of the end of the period covered by this report. Based on this evaluation, our principal executive officer and principal financial officer concluded as of the evaluation date that our disclosure controls and procedures were non- effective in such that the material information required to be included in our Securities and Exchange Commission reports is accumulated and communicated to our management, including our principal executive and financial officer, recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms relating to our Company, particularly during the period when this report was being prepared. MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, for the Company. Internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of its management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements. Management recognizes that there are inherent limitations in the effectiveness of any system of internal control, and accordingly, even effective internal control can provide only reasonable assurance with respect to financial statement preparation and may not prevent or detect material misstatements. In addition, effective internal control at a point in time may become ineffective in future periods because of changes in conditions or due to deterioration in the degree of compliance with our established policies and procedures. -24-
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in there being a more than remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. Under the supervision and with the participation of our President, management conducted an evaluation of the effectiveness of our internal control over financial reporting, as of August 31, 2017, based on the framework set forth in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our evaluation under this framework, management concluded that our internal control over financial reporting was not effective as of the evaluation date due to the factors stated below. Management assessed the effectiveness of the Company's internal control over financial reporting and identified the following material weaknesses: INSUFFICIENT RESOURCES: We have an inadequate number of personnel within the key functional areas of finance and accounting. INADEQUATE SEGREGATION OF DUTIES: We have an inadequate number of personnel to properly implement control procedures. LACK OF AUDIT COMMITTEE & OUTSIDE DIRECTORS ON THE COMPANY'S BOARD OF DIRECTORS: We do not have a functioning audit committee or outside directors on our Board of Directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures. Management, including our President, has discussed the material weakness noted above with our independent registered public accounting firm. Due to the nature of this material weakness, there is a more than remote likelihood that misstatements which could be material to the annual or interim financial statements could occur that would not be prevented or detected. This annual report 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 the our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management's report in this annual report. MANAGEMENT'S REMEDIATION INITIATIVES In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures: We will create a position to segregate duties consistent with control objectives and increase our personnel resources within the accounting function when funds are available to us. And, we plan to appoint one or more outside directors to our Board of Directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us. -25-
Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on our Board. We anticipate that these initiatives will be at least partially, if not fully, implemented by August 31, 2019. Additionally, we plan to test our updated controls and remediate our deficiencies by August 31, 2019. CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING There have been no changes in our internal control over financial reporting that occurred during the last fiscal quarter for our fiscal year ended August 31, 2018 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. -26-
PART III BACKGROUND INFORMATION Mr. Kevin Nichols has been the President, Secretary, Treasurer and sole Director of SATUSA since January 29, 2009, the date of its inception. His background is as follows: BBA Boise State University, Boise, ID Major: Accounting and Finance Over the past nineteen years, Mr. Nichols has been self-employed as an independent business consultant through his wholly-owned company, SAT, LLC and through Altres Group, LLC, which is owned jointly, on a 50/50 basis by him and his brother, Jeff Nichols. These companies specialize in providing assistance with the many start-up and other requirements of new and existing businesses, including company formations and structuring, elements of tax and accounting, and analyzing existing businesses for inefficiencies, ways to increase profits, and seek new growth opportunities. Mr. Nichols has also designed and taught an SAT Prep program to local area high school students for the past several years. Prior to self-employment, Mr. Nichols held positions primarily in areas of accounting and finance with such companies as Arthur Andersen & Co, SAFECO Properties, Wells Fargo, Seafirst Bank, Bank of America, and Kiemle Hagood. ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS The sole officer and director of SATUSA, whose one-year term will expire January 31, 2019, or at such a time as their successor(s) shall be elected and qualified is as follows: Name & Address Age Position Date First Elected Term Expires -------------- --- -------- ------------------ ------------ Kevin Nichols 59 President, 1/29/2009 1/31/2019 4327 S Pittsburg Secretary, Spokane, WA 99203 Treasurer, CFO, CEO & Director The foregoing person is a promoter of SATUSA CORPORATION, as that term is defined in the rules and regulations promulgated under the Securities and Exchange Act of 1933. Directors are elected to serve until the next annual meeting of stockholders and until their successors have been elected and qualified. Officers are appointed to serve until the meeting of the Board of Directors following the next annual meeting of stockholders and until their successors have been elected and qualified. Kevin Nichols currently devotes ten to twenty hours per week to Company matters, in the future he intends to devote as much time as the Board of Directors deems necessary to manage the affairs of the Company, and as his schedule with his other business interests permits. -27-
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS No executive officer or director of the Company has been the subject of any order, judgment, or decree of any court of competent jurisdiction, or any regulatory agency permanently or temporarily enjoining, barring, suspending, or otherwise limiting him or her from acting as an investment advisor, underwriter, broker, or dealer in the securities industry, or as an affiliated person, director, or employee of an investment company, bank, savings and loan association, or insurance company or from engaging in or continuing any conduct or practice in connection with any such activity or in connection with the purchase or sale of any securities. No executive officer or director of the Company has been convicted in any criminal proceeding (excluding traffic violations) or is the subject of a criminal proceeding which is currently pending. CONFLICT OF INTEREST Our sole Officer and Director does not currently devote all his business time to our operations and is actively involved in other business endeavors. Other than his time commitments/conflicts with his other business interests, there is no direct competition or conflict of Company interests with any other of Mr. Nichols' businesses. CODE OF ETHICS The Company does not currently have a code of ethics, because we have only limited business operations and only one officer and director, we believe a code of ethics would have limited utility. We intend to adopt such a code of ethics as our business operations expand and we have more directors, officers, and employees. -28-
ITEM 11. EXECUTIVE COMPENSATION Our current sole officer receives no compensation. The current Board of Directors is comprised of Kevin Nichols. SUMMARY COMPENSATION TABLE Non-Equity Nonqualified Incentive Deferred All Name and Plan Compen- Other Principal Stock Option Compen- sation Compen- Position Year Salary Bonus Awards Awards sation Earnings sation Totals -------- --- ------ ----- ------ ------ ------ -------- ------ ------ Kevin Nichols,2018 0 0 0 0 0 0 0 0 President,2017 0 0 0 0 0 0 0 0 CEO & CFO 2016 0 0 0 0 0 0 0 0 2015 0 0 0 0 0 0 0 0 2014 0 0 0 0 0 0 0 0 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END Name (1) (2) (3) (4) (5) (6) (7) (8) (9) -------------- ---- ---- ---- ---- ---- ---- ---- ---- ---- Kevin Nichols 0 0 0 0 0 0 0 0 0 CEO & CFO --------------- (1) Number of Securities Underlying Unexercised Options, Exercisable (2) Number of Securities Underlying Unexercised Options, Unexercisable (3) Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (4) Option Exercise Price (5) Option Expiration Date (6) Number of Shares or Units of Stock That Have Not Vested (7) Market Value of Shares or Units of Stock That Have Not Yet Vested (8) Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (9) Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested DIRECTOR COMPENSATION Change in Pension Value and Fees Non-Equity Nonqualified Earned/ Incentive Deferred Paid in Stock Option Plan Compensation All Other Name Cash Awards Awards Compensation Earnings Compensation Total -------- ---- ------ ------ ------------ -------- ------------ ----- Kevin Nichols 0 0 0 0 0 0 0 Director There are no current employment agreements between the Company and its executive officer. -29-
On May 29, 2009 Kevin Nichols purchased 12,000,000 shares of our common stock at $0.00017 per share, for total proceeds of $2,000. The terms of the stock issuance was as fair to the Company, in the opinion of the Board of Directors, as could have been made with an unaffiliated third party. In December, 2010, Kevin Nichols gifted a total of 260,000 shares of his common stock to thirty-two (32) family members and friends. Mr. Nichols currently devotes approximately ten to twenty hours per week to manage the affairs of the Company. He has agreed to work with no remuneration until such time as the Company receives sufficient revenues necessary to provide management salaries. At this time, we cannot accurately estimate when sufficient revenues will occur to implement this compensation, or what the amount of the compensation will be. There are no annuity, pension, or retirement benefits proposed to be paid to officers, directors, or employees in the event of retirement at normal retirement date pursuant to any presently existing plan provided or contributed to by the company or any of its subsidiaries, if any. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth information on the ownership of SATUSA voting securities by officers, directors, and major shareholders as well as those who own beneficially more than five percent of our common stock: Name of No. of Percentage Beneficial Owner (1) Shares of Ownership: -------------------- ------ ------------- Kevin Nichols 11,740,000 95% All Officers and Directors as a Group 11,740,000 95% ---------- (1) The person named may be deemed to be a "parent" and "promoter" of the Company, within the meaning of such terms under the Securities Act of 1933, as amended. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS In May 2009, Kevin Nichols purchased 12,000,000 shares of the Company's common stock at $0.00017 per share. In December, 2010, Kevin Nichols gifted a total of 260,000 shares of his common stock to thirty-two (32) family members and friends, leaving him with 11,740,000 shares at present. All of Kevin Nichols' shares are "restricted" securities, as that term is defined by the Securities Act of 1933, as amended, and are held by the officer and director of the Company. (See "Principal Stockholders".) -30-
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES The total fees charged to the Company for audit-related services were $9,990, for tax services were $0, and for other services were $0 during the year ended August 31, 2018. For the year ended August 31, 2017, the total fees charged to the Company for audit services were $9,250, for tax services were $0, and for other services were $0. PART IV ITEM 15. EXHIBITS Incorporated by Reference Exhibit No. Exhibit or Filed Herewith ---------- ------- ----------------------------- 3.1 Articles of Incorporation Incorporated by reference to the Registration Statement on Form S-1 filed with the SEC on May 20, 2010, File No. 333- 162824 3.2 Bylaws Incorporated by reference to the Registration Statement on Form S-1 filed with the SEC on May 20, 2010, File No. 333- 162824 23.1 Consent of Independent Auditors 31 Section 302 Certification of Filed herewith Chief Executive Officer & Chief Financial Officer 32 Section 906 Certification of Filed herewith Chief Executive Officer and Chief Financial Officer SIGNATURES In accordance with the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe it meets all of the requirements for filing Form 10-K and authorized this registration statement to be signed on its behalf by the undersigned, in the city of Spokane, state of Washington, on November 15, 2018. SATUSA CORPORATION, Registrant /s/ Kevin Nichols November 15, 2018 ----------------- ----------------- Kevin Nichols, President & Director Date (Principal Executive Officer, Principal Financial Officer, Principal Accounting Officer) -31-