We
are subject to those financial risks generally associated with development
stage enterprises. Since we have sustained losses since inception, we will
require financing to fund our development activities and to support our
operations and will independently seek additional financing. However, we may be
unable to obtain such financing. We are also subject to risk factors specific
to our business strategy and the private equity industry.
In
addition to the other information provided in this annual report, you should
carefully consider the following risk factors in evaluating our business before
purchasing any of our common stock. All material risks are discussed in this
section.
Risks Relating
to Our Business and Industry
1.
We
are a small company with limited history and we may not be able to manage our
future businesses on a profitable basis.
As
the result of the transaction consummated on December 31, 2019, Alpharidge
Capital LLC became the Company’s wholly owned operating subsidiary and the
business of Alpharidge Capital LLC became the Company’s sole business
operations. Our management team will manage the day-to-day operations and
affairs of our company and oversee the management and operations of our future
businesses, subject to the oversight of our board of directors. If we do not
develop effective systems and procedures, including accounting and financial
reporting systems, to manage our operations as a consolidated public company,
we may not be able to manage the combined enterprise on a profitable basis,
which could adversely affect our ability to pay distributions to our
shareholders.
2.
We
will require additional funds in the future to achieve our current business
strategy and our inability to obtain funding will cause our business to fail.
We
will need to raise additional funds through public or private debt or equity
sales in order to fund our future operations and fulfill contractual
obligations in the future. These financings may not be available when needed.
Even if these financings are available, it may be on terms that we deem
unacceptable or are materially adverse to your interests with respect to
dilution of book value, dividend preferences, liquidation preferences, or other
terms. Our inability to obtain financing would have an adverse effect on our
ability to implement our current business plan and develop our products, and as
a result, could require us to diminish or suspend our operations and possibly
cease our existence.
Even
if we are successful in raising capital in the future, we will likely need to
raise additional capital to continue and/or expand our operations. If we do not
raise the additional capital, the value of any investment in our Company may
become worthless. In the event we do not raise additional capital from
conventional sources, it is likely that we may need to scale back or curtail
implementing our business plan.
3.
If
we fail to develop and commercialize new products or expand the indications for
existing products, our prospects for future revenues and our results of
operations may be adversely affected.
The
success of our biopharmaceutical business depends on our ability to introduce
new products as well as expand the indications for our existing products to
address areas of unmet medical need. The launch of commercially successful
products is necessary to cover our substantial R&D expenses and to offset
revenue losses when our existing products lose market share due to various
factors such as competition and loss of patent exclusivity, as well as to
provide for the growth of our business. There are many difficulties and
uncertainties inherent in drug development and the introduction of new
products. The product development cycle is characterized by significant
investments of resources, long lead times and unpredictable outcomes due to the
nature of developing medicines for human use. We expend significant time and
resources on our product pipeline without any assurance that we will recoup our
investments or that our efforts will be commercially successful. A high rate of
failure is inherent in the discovery and development of new products, and
failure can occur at any point in the process, including late in the process after
substantial investment. For example, see “We face risks in our clinical trials,
including the potential for unfavorable results,
delays in anticipated timelines and disruption, which may adversely affect our
prospects for future revenue growth and our results of operations.” We cannot
state with certainty when or whether any of our product candidates under
development will be approved or launched; whether we will be able to develop,
license or acquire additional product candidates or products; or whether any
products, once launched, will be commercially successful. Failure to launch
commercially successful new products or new indications for existing products
could have a material adverse effect on our future revenues, results of
operations and long-term success.
4. We
may in the future engage in, business acquisitions, licensing arrangements,
collaborations, disposals of our assets and other strategic transactions, which
could cause us to incur significant expenses and could adversely affect our
financial condition and results of operations.
We
may in the future engage in, business acquisitions, licensing arrangements,
collaborations, disposals of our assets and other transactions, as part of our
business strategy. We may not identify suitable transactions in the future and,
if we do, we may not complete such transactions in a timely manner, on a
cost-effective basis, or at all, and may not realize the expected benefits. For
example, if we are successful in making an acquisition, the products and
technologies that are acquired may not be successful or may require
significantly greater resources and investments than originally anticipated. We
also may not be able to integrate acquisitions successfully into our existing
business and could incur or assume significant debt and unknown or contingent
liabilities.
5. We
have reported limited revenue and net profits, and there can be no assurance
that we will ever generate significant revenue or net income.
We
have limited operating history upon which an evaluation of our future prospects
can be made. For the year ended December 31, 2019, we have reported net profit
of $6,188. Our prospects of generating significant revenue and becoming a
profitable company must be considered in light of the substantial risks,
expenses and difficulties encountered by new entrants into the mergers,
acquisition and turnaround industry. No assurance can be given that we
will have significant net income in future periods or ever generate
significant revenue. Our ability to achieve and maintain significant
profitability and positive cash flow is highly dependent upon a number of
factors, including our ability to secure adequate financing for our
acquisitions and investments, identify attractive targets, attract managerial talents
and produce effective business-turnaround models for the businesses we acquire.
Based upon current plans, we expect to incur operating losses in future periods
as we incur expenses associated with our business. Further, we cannot guarantee
that we will be successful in realizing revenues or in achieving or sustaining
positive cash flow at any time in the future. Any such failure could result in
the possible closure of our business or force us to seek additional capital
through loans or additional sales of our equity securities to continue business
operations, which would dilute the value of the outstanding shares of our
common stock.
6.
We
have little or limited operating history and relatively new business model in
an emerging and rapidly evolving market. This makes it difficult to evaluate
our future prospects and may increase the risk of your investment.
You must consider our business and
prospects in light of the risks and difficulties we will encounter as a small company
in a new and rapidly evolving market. We may not be able to successfully
address these risks and difficulties, which could materially harm our business
and operating results.
7.
Difficult
market conditions can adversely affect our business in many ways, including by
reducing the value or performance of the investments, reducing the ability of
the portfolio companies we acquire to raise or deploy capital and reducing the
volume of the transactions involving acquisitions, restructuring and
turnaround, each of which could materially reduce our revenue and cash flow and
adversely affect our financial condition.
Our business will be materially affected
by conditions in the global financial markets and economic conditions
throughout the world that are outside our control, such as interest rates,
availability of credit, inflation rates, economic uncertainty, changes in laws
(including laws relating to taxation), trade barriers, commodity prices,
currency exchange rates and controls and national and international political
circumstances (including wars, terrorist acts or security operations). These
factors may affect the level and volatility of securities prices and the
liquidity and the value of investments, and we may not be able to or may choose
not to manage our exposure to these market conditions. In the event of a market
downturn, each of our businesses could be affected in different ways. Our significant
profitability may also be adversely affected by our fixed costs and the possibility that we would be unable to scale back
other costs within a time frame sufficient to match any decreases in revenue
relating to changes in market and economic conditions.
Our investment activities may be
affected by reduced opportunities to exit and realize value from businesses and
by the fact that we may not be able to find suitable investments for our
officers to effectively deploy capital, which could adversely affect our
ability to raise new funds. During periods of difficult market conditions or
slowdowns in a particular sector, companies in which we invest may experience
decreased revenues, financial losses, difficulty in obtaining access to
financing and increased funding costs. During such periods, these companies may
also have difficulty in expanding their businesses and operations and be unable
to meet their debt service obligations or other expenses as they become due,
including expenses payable to us. In addition, during periods of adverse
economic conditions, we may have difficulty accessing financial markets, which
could make it more difficult or impossible for us to obtain funding for
additional investments and harm our investments, assets and operating results.
A general market downturn, or a specific market dislocation, may result in
lower return on investment, which would adversely affect our revenues.
Furthermore, such conditions would also increase the risk of default with
respect to our mezzanine debt investments.
8.
Additional
capital, if needed, may not be available on acceptable terms, if at all, and
any additional financing may be on terms adverse to your interests.
We
will need additional cash to fund our operations on an ongoing basis. Our
capital needs will depend on numerous factors, including market conditions
and our significant profitability. We cannot be certain that we will be able
to obtain additional financing on favorable terms, if at all. If additional
financing is not available when required or is not available on acceptable
terms, we may be unable to fund acquisitions, investments, take advantage of
business opportunities, or respond to competitive pressures or unanticipated
requirements, any of which could seriously harm our business and reduce the
value of your investment.
If
we are able to raise additional funds, if and when needed, by issuing
additional equity securities, you may experience significant dilution of your
ownership interest and holders of these new securities may have rights senior
to yours as a holder of our common stock. If we obtain additional financing
by issuing debt securities, the terms of those securities could restrict or
prevent us from declaring dividends and could limit our flexibility in making
business decisions. In this case, the value of your investment could be
reduced.
|
9.
Having
only two directors limits our ability to establish effective independent
corporate governance procedures.
We have only two directors who also serve as the Company’s officers.
Accordingly, we cannot establish board committees comprised of independent
members to oversee functions like compensation or audit issues. In addition, a
vote of the board members is decided in favor of our president, which gives him
significant control over all corporate issues.
Until we have a larger board of directors that would include some
independent members, if ever, there will be limited oversight of our
president’s decisions and activities and little ability for minority
shareholders to challenge or reverse those activities and decisions, even if
they are not in the best interests of minority shareholders.
10.
Our
officers and directors have relevant, but limited experience in the mergers,
acquisition and turnaround industry, which could prevent us from successfully
implementing our business plan, and impede our ability to earn revenue.
Our
officers and director relevant, but limited practical experience in the biopharmaceutical
industry, mergers, acquisition and business turnaround; they have worked
alongside others in a team environment to successfully manage other businesses,
mergers, acquisition and turnaround opportunities. Our managements’ limited
experience could hinder their ability to successfully develop strategies that
will result in successful operation, or to secure acquisition/investment
financing. It is likely that our management's limited experience with mergers,
acquisition, turnaround and financing could hinder our ability to earn significant
revenue. Each potential investor must carefully consider the limited experience
of our officers and director before purchasing our common stock.
11. Key management
personnel may leave us, which could adversely affect our ability to continue
operations.
Our
future success depends in a large part upon the continued service of key
members of our senior management team. In particular, we are entirely dependent
on the efforts of Frank Igwealor, our president and chief executive officer and
Managing Director. The loss of our officers and President and CEO, or of other
key personnel hired in the future, could have a material adverse effect on the
business and its prospects. We believe that we have made all commercially
reasonable efforts to minimize the risks attendant with the departure by key
personnel and we plan to continue these efforts in the future. There is
currently no employment contract by and between any office/director and us.
Also, there is no guarantee that replacement personnel, if any, will help us to
operate profitably. Mr. Igwealor has been, and continues to expect to be able
to commit approximately 15 hours per week of his time, to the development of
our business plan in the next six months. If he is required to spend additional
time with his outside employment, he may not have sufficient time to devote to
us and we would be unable to develop our business plan resulting in business
failure.
We
do not maintain key person life insurance on our officers and President
and CEO. The loss of any of our management or key personnel could seriously
harm our business.
12.
Our
future success is dependent on our employees and the management team of our target
businesses, the loss of any of whom could materially adversely affect our
financial condition, business and results of operations.
The
future success of our businesses also depends on the respective management
teams of those businesses because we intend to operate our businesses on a holding-company-subsidiary
basis, each subsidiary being run by independently, primarily relying on their
existing management teams for management of our businesses’ day-to-day
operations. Consequently, their operational success, as well as the success of
any organic growth strategy, will be dependent on the continuing efforts of the
management teams of our future businesses. We will seek to provide these
individuals with equity incentives in our company and to have employment
agreements with certain persons we have identified as key to their businesses.
However, these measures may not prevent these individuals from leaving their
employment. The loss of services of one or more of these individuals may
materially adversely affect our financial condition, business and results of
operations.
In
addition, we may have difficulty effectively integrating and managing future acquisitions.
The management or improvement of businesses we acquire may be hindered by a
number of factors, including limitations in the standards, controls, procedures
and policies implemented in connection with such acquisitions. Further, the
management of an acquired business may involve a substantial reorganization of
the business’ operations resulting in the loss of employees and customers or
the disruption of our ongoing businesses. We may experience greater than
expected costs or difficulties relating to an acquisition, in which case, we
might not achieve the anticipated returns from any particular acquisition.
13.
If
we are unable to retain or motivate key personnel or hire qualified personnel,
we may not be able to grow effectively.
Our future performance is largely
dependent on the talents and efforts of highly skilled individuals. Our future
success depends on our ability to identify, hire, develop, motivate and retain
highly skilled personnel for all areas of our organization. Competition in our
industry for qualified employees is intense, and we are aware that our
competitors will directly target our employees. Our ability to compete
effectively depends on our ability to attract new employees and to retain and
motivate our existing employees.
We intend to develop and maintain a
rigorous, highly selective and time-consuming hiring process. We believe that
our planned approach to hiring will significantly contribute to our future
success. As we execute our business plan, our hiring process may prevent us
from hiring the personnel we need in a timely manner. If we do not succeed in
attracting excellent personnel or retaining or motivating existing personnel,
we may be unable to operate effectively.
14.
If
we are unable to provide future officers with sufficient equity interests in
our business to the same extent or with the same tax consequences as our
existing officer, we may not be able to retain or motivate key personnel or
hire qualified personnel.
Our
most important asset is our people, and our success will be highly dependent
upon the efforts of our officers, directors and other professionals. Our future
success and growth will depend to a substantial degree on our ability to retain
and motivate our officers, senior managers and other
key personnel and to strategically recruit, retain and motivate new talented
personnel, including new officers.
We might not be able to provide future
officers with sufficient equity interests in our business to the same extent or
with the same tax consequences as our existing officers. Therefore, in order to
recruit and retain existing and future officers, we may need to increase the
level of compensation that we pay to them. Accordingly, as we promote or hire
new officers over time, we may increase the level of compensation we pay to our
officers, which would cause our total employee compensation and benefits expense
as a percentage of our total revenue to increase and adversely affect our significant
profitability. In addition, issuance of equity interests in our business to
future officers would dilute existing public shareholders’ stake.
We plan to maintain a work environment
that reinforces our culture of collaboration, motivation and alignment of
interests with investors. The effects of becoming public, including potential
changes in our compensation structure, could adversely affect this culture. If
we do not continue to develop and implement the right processes and tools to
manage our changing enterprise and maintain this culture, our ability to
compete successfully and achieve our business objectives could be impaired,
which could negatively impact our business, financial condition and results of
operations.
15.
Because
we intend to make equity
awards to our employees on an ongoing basis, these equity awards to employees
will be dilutive to the book value of investors’ shares of our common stock.
We intend to make equity awards to all
of our employees on an ongoing basis as an incentive to unlock the talents and
dedication of all of our employees to contribute to our success. These
ongoing equity awards to employees will be dilutive to the book value of
investors’ shares of our common stock. These equity awards will surely result
in dilution to investors. “Dilution” represents the difference
between the selling price of the shares of our common stock and the net book
value per share of common stock. "Net book value" is the amount that
results from subtracting total liabilities from total assets.
16. Compliance with
changing regulation of corporate governance and public disclosure may result in
additional expenses.
Changing
laws, regulations and standards relating to corporate governance and public
disclosure, including the Sarbanes-Oxley Act of 2002, new SEC regulations and
Finra rules, are creating uncertainty for companies such as ours. These new or
changed laws, regulations and standards are subject to varying interpretations
in many cases due to their lack of specificity, and as a result, their
application in practice may evolve over time as new guidance is provided by
regulatory and governing bodies, which could result in continuing uncertainty
regarding compliance matters and higher costs necessitated by ongoing revisions
to disclosure and governance practices. We are committed to maintaining high
standards of corporate governance and public disclosure. As a result, we intend
to invest resources to comply with evolving laws, regulations and standards,
and this investment may result in increased general and administrative expenses
and a diversion of management time and attention from revenue-generating
activities to compliance activities. If our efforts to comply with new or
changed laws, regulations and standards differ from the activities intended by
regulatory or governing bodies due to ambiguities related to practice, our
reputation may be harmed.
17.
Failure
to achieve and maintain effective internal controls in accordance with Section
404 of the Sarbanes-Oxley Act of 2002 could prevent us from producing reliable
financial reports or identifying fraud. In addition, current and potential
stockholders could lose confidence in our financial reporting, which could have
an adverse effect on our stock price.
Effective
internal controls are necessary for us to provide reliable financial reports
and effectively prevent fraud, and a lack of effective controls could preclude
us from accomplishing these critical functions. We are
required to document and test our internal control procedures in order to
satisfy the requirements of Section 404 of the Sarbanes-Oxley Act of 2002,
which requires annual management assessments of the effectiveness of an
issuer’s internal controls over financial reporting. Responsibility
for all accounting issues at present rest with Mr. Igwealor, our President,
Chief Executive Officer and Chief Financial Officer, which may be deemed to be inadequate. Although
we intend to augment our internal controls procedures and expand our accounting
staff, there is no guarantee that this effort will be adequate.
During
the course of our testing, we may identify deficiencies which we may not be
able to remediate. In addition, if we fail to maintain the
adequacy of our internal accounting controls, as such standards are modified,
supplemented or amended from time to time, we may not be able to ensure that we
can conclude on an ongoing basis that we have effective internal controls over financial reporting in accordance with Section
404. Failure to achieve and maintain an effective internal
control environment could cause us to face regulatory action and also cause
investors to lose confidence in our reported financial information.
18.
If
we are unable to obtain additional funding our business operation will be
harmed; and if we do obtain additional funding, our then existing shareholders
may suffer substantial dilution.
We
have limited financial resources. As of December 31, 2019, we had $500 of cash
on hand. If we are unable to develop our business or secure additional funds
our business would fail and our shares may be worthless. We may seek to obtain
debt financing as well. There is no assurance that we will not incur debt in
the future, that we will have sufficient funds to repay any indebtedness, or
that we will not default on our debt obligations, jeopardizing our business
viability. Furthermore, we may not be able to borrow or raise additional
capital in the future to meet our needs, or to otherwise provide the capital
necessary to conduct our business. There can be no assurance that financing
will be available in amounts or on terms acceptable to us, if at all. The inability
to obtain additional capital will restrict our ability to grow and may reduce
our ability to continue to conduct business operations. If we are unable to
obtain additional financing, we will likely be required to curtail our business
plans and possibly cease our operations. Any additional equity financing may
involve substantial dilution to our then existing shareholders.
19.
In
the future we may seek additional financing through the sale of our common
stock resulting in dilution to existing shareholders.
The
most likely source of future financing presently available to us is through the
sale of shares of our common stock. Any sale of common stock will result
in dilution of equity ownership to existing shareholders. This means that, if
we sell shares of our common stock, more shares will be outstanding and each
existing shareholder will own a smaller percentage of the shares then
outstanding, which will result in a reduction in the value of an existing
shareholder’s interest. To raise additional capital we may have to issue
additional shares, which may substantially dilute the interests of existing
shareholders. Alternatively, we may have to borrow large sums, and assume debt
obligations that require us to make substantial interest and capital payments.
We
cannot guarantee we will be successful in generating revenue in the future or
be successful in raising funds through the sale of shares to pay for our
business plan and expenditures. As of the date of this registration statement
of which this prospectus is a part, we have not earned any revenue. Failure to
generate revenue will cause us to go out of business, which will result in the
complete loss of your investment.
20.
Our
use of leverage to finance our business will expose us to substantial risks,
which are exacerbated by our use of leverage to finance investments.
It
is our intention to eventually use a significant amount of borrowings to
finance our business operations as a public company. That will expose us to
the typical risks associated with the use of substantial leverage, including
those discussed below under. These risks are exacerbated by our use of leverage
to finance acquisitions and investments. Our use of substantial leverage as a
public company, coupled with the leverage to be used by many of our portfolio
businesses to finance operations and investments, could also stop us obtaining
a decent credit ratings from the rating agencies, which might well result in an
increase in our borrowing costs and could otherwise adversely affect our
business in a material way.
21.
Dependence
on significant leverage in
investments by our funds could adversely affect our ability to achieve
attractive rates of return on those investments.
Because many of the private equity and
real estate investments we intend to make would rely heavily on the use of
leverage, our ability to achieve attractive rates of return on investments will
depend on our ability to access sufficient sources of indebtedness at
attractive rates. For example, in many private equity investments, indebtedness
may constitute 70% or more of a portfolio company's or real estate asset's
total debt and equity capitalization, including debt that may be incurred in
connection with the investment. An increase in either the general levels of
interest rates or in the risk spread demanded by sources of indebtedness would
make it more expensive to finance those investments. Increases in interest
rates could also make it more difficult to locate and consummate private equity
investments because other potential buyers, including operating
companies acting as strategic buyers, may be able to bid for an asset at a
higher price due to a lower overall cost of capital. In addition, a portion of
the indebtedness used to finance private equity investments often includes
high-yield debt securities issued in the capital markets. Availability of
capital from the high-yield debt markets is subject to significant volatility,
and there may be times when we might not be able to access those markets at
attractive rates, or at all, when completing an investment.
Ownership or investments in highly
leveraged entities are inherently more sensitive to declines in revenues,
increases in expenses and interest rates and adverse economic, market and
industry developments. The incurrence of a significant amount of indebtedness
by an entity could, among other things:
·
give
rise to an obligation to make mandatory prepayments of debt using excess cash
flow, which might limit the entity's ability to respond to changing industry
conditions to the extent additional cash is needed for the response, to make
unplanned but necessary capital expenditures or to take advantage of growth
opportunities;
·
limit
the entity's ability to adjust to changing market conditions, thereby placing
it at a competitive disadvantage compared to its competitors who have
relatively less debt;
·
limit
the entity's ability to engage in strategic acquisitions that might be
necessary to generate attractive returns or further growth; and
·
limit
the entity's ability to obtain additional financing or increase the cost of
obtaining such financing, including for capital expenditures, working capital
or general corporate purposes.
As a result, the risk of loss associated
with a leveraged entity is generally greater than for companies with
comparatively less debt.
The mezzanine finance component of our
business plan may choose to use leverage as part of its investment programs and
regularly borrow a substantial amount of the capital. The use of leverage poses
a significant degree of risk and enhances the possibility of a significant loss
in the value of the portfolio. We may borrow money from time to time to
purchase or carry businesses, properties or securities. The interest expense
and other costs incurred in connection with such borrowing may not be recovered
by appreciation in the businesses, properties or securities purchased or
carried, and will be lost—and the timing and magnitude of such losses may be
accelerated or exacerbated—in the event of a decline in the market value of
such securities. Gains realized with borrowed funds may cause our enterprise
value to increase at a faster rate than would be the case without borrowings.
However, if investment results fail to cover the cost of borrowings, our
enterprise value could also decrease faster than if there had been no
borrowings.
Any
of the foregoing circumstances could have a material adverse effect on our
financial condition, results of operations and cash flow.
22.
The
due diligence process that we undertake in connection
with investments may not reveal all facts that may be relevant in connection
with that investment.
Before we acquire any business or make
private equity and other investments, we intend to conduct due diligence that
is deem reasonable and appropriate based on the facts and circumstances
applicable to each investment. When conducting due diligence, we may be
required to evaluate important and complex business, financial, tax,
accounting, environmental and legal issues. Outside consultants, legal
advisors, accountants and investment banks may be involved in the due diligence
process in varying degrees depending on the type of investment. Nevertheless,
when conducting due diligence and making an assessment regarding an investment,
we rely on the resources available to us, including information provided by the
target of the investment and, in some circumstances, third-party
investigations. The due diligence investigation that we will carry out with
respect to any investment opportunity may not reveal or highlight all relevant
facts that may be necessary or helpful in evaluating such investment
opportunity. Moreover, such an investigation will not necessarily result in the
investment being successful.
23.
We
face competition for businesses
that fit our acquisition strategy and, therefore, we may have to acquire
targets at sub-optimal prices or, alternatively, forego certain acquisition
opportunities.
We have been formed to acquire and
manage small to middle market businesses. In pursuing such acquisitions, we
expect to face strong competition from a wide range of other potential
purchasers. Although the pool of potential purchasers for such businesses is typically smaller than for larger
businesses, those potential purchasers can be aggressive in their approach to
acquiring such businesses. Furthermore, we expect that we may need to use
third-party financing in order to fund some or all of these potential
acquisitions, thereby increasing our acquisition costs. To the extent that
other potential purchasers do not need to obtain third-party financing or are
able to obtain such financing on more favorable terms, they may be in a
position to be more aggressive with their acquisition proposals. As a result, in
order to be competitive, our acquisition proposals may need to be aggressively
priced, including at price levels that exceed what we originally determined to
be fair or appropriate in order to remain competitive. Alternatively, we may
determine that we cannot pursue on a cost effective basis what would otherwise
be an attractive acquisition opportunity.
24.
We
may not be able to successfully fund future acquisitions of new businesses due
to the unavailability of debt or equity financing on acceptable terms, which
could impede the implementation of our acquisition strategy.
In order to make future acquisitions, we
intend to raise capital primarily through debt financing at our company level,
additional equity offerings, the sale of equity or assets of our businesses,
offering equity in our company or our businesses to the sellers of target
businesses or by undertaking a combination of any of the above. Because the
timing and size of acquisitions cannot be readily predicted, we may need to be
able to obtain funding on short notice to benefit fully from attractive
acquisition opportunities. Such funding may not be available on acceptable
terms. In addition, the level of our indebtedness may impact our ability to
borrow at our company level. The sale of additional common shares will also be
subject to market conditions and investor demand for the common shares at
prices that may not be in the best interest of our shareholders. These risks
may materially adversely affect our ability to pursue our acquisition strategy.
25.
We
may change our management and
acquisition strategies without the consent of our shareholders, which may
result in a determination by us to pursue riskier business activities.
We may change our strategy at any time
without the consent of our shareholders, which may result in our acquiring
businesses or assets that are different from, and possibly riskier than, the
strategy described in this prospectus. A change in our strategy may increase
our exposure to interest rate and currency fluctuations, subject us to
regulation under the Investment Company Act of 1940, as amended, which we refer
to as the Investment Company Act, or subject us to other risks and
uncertainties that affect our operations and significant profitability.
26.
Our
community-empowerment and
job-creation projects involves investments in relatively high-risk, illiquid
assets, and we may fail to realize any profits from these activities for a
considerable period of time or lose some or all of our principal investments.
We intend to make most of our
community-empowerment and job-creating investments in private businesses whose
securities are not publicly traded. In many cases, these investments may remain
illiquid for a period of time. We will generally not be able to easily exit
from such investment until the investee’s securities are registered under
applicable securities laws, or unless an exemption from such registration is
available. Our ability, particularly our private equity operation’s, to dispose
of investments will be heavily dependent on the public equity markets. Even
when investee’s securities are publicly traded, large holdings of securities
can often be disposed of only over a substantial length of time, exposing the
investment returns to risks of downward movement in market prices during the
intended disposition period. Accordingly, under certain conditions, we may be
forced to either sell securities at lower prices than we would have expected to
realize or defer—potentially for a considerable period of time—sales that we
had planned to make. We intend to make significant principal investments in our
community-empowerment and job-creation projects. Contributing capital to these
investments is risky, and we may lose some or the entire principal amount of
our investments.
27.
Our
community-empowerment and job-creation
projects may sometimes make investments in companies that we do not control.
Our
community-empowerment and job-creating investments will often include debt
instruments and equity securities of companies that we do not control. We may
acquire such instruments and securities primarily through purchases of
securities from the issuer. In addition, we may dispose of a portion of our
majority equity stake in portfolio community-empowerment and job-creation
businesses over time in a manner that results in GiveMePower Corporation
retaining a minority investment. Those investments will be subject to the risk
that the company in which the investment is made may make business, financial
or management decisions with which we do not agree or that the majority
stakeholders or the management of the company may take
risks or otherwise act in a manner that does not serve our community-empowerment
and job-creation interests. If any of the foregoing were to occur, we may be
forced to liquidate our investments prematurely and our financial condition,
results of operations and cash flow could suffer as a result.
28.
In
the future, we will seek to enter into a credit facility to help fund our
acquisition capital and working capital needs. This credit facility may expose
us to additional risks associated with leverage and may inhibit our operating
flexibility and reduce cash flow available for distributions to our shareholders.
Following
the identification of a platform acquisition, we will seek to enter into a
credit facility with a third party lender. Our proposed third-party credit
facility will likely require us to pay a commitment fee on the undrawn amount.
Our proposed third-party credit facility will contain a number of affirmative
and restrictive covenants.
If
we violate any such covenants, our lender could accelerate the maturity of any
debt outstanding and we may be prohibited from making any distributions to our
shareholders. Such debt may be secured by our assets, including the stock we may
own in businesses that we may acquire in the future and the rights we have
under intercompany loan agreements that we may enter into in the future with
our businesses. Our ability to meet our debt service obligations may be
affected by events beyond our control and will depend primarily upon cash
produced by businesses that we may acquire in the future and distributed or
paid to our company. Any failure to comply with the terms of our indebtedness
may have a material adverse effect on our financial condition.
29.
System
failures could harm our business.
Our
systems may be vulnerable to damage or interruption from earthquakes, terrorist
attacks, floods, fires, power loss, telecommunication failures, computer
viruses, computer denial of service attacks or other attempts to harm our
system, and similar events. Some of our data centers may be located in areas
with a high risk of major earthquakes. Our data centers are also subject to
break-ins, sabotage and intentional acts of vandalism, and to potential
disruptions if the operators of these facilities have financial difficulties.
Some of our systems are not fully redundant, and our disaster recovery planning
cannot account for all eventualities. The occurrence of a natural disaster, a
decision to close a facility we are using without adequate notice for financial
reasons or other unanticipated problems at our data centers could result in
lengthy interruptions in our service. Any damage to or failure of systems could
result in interruptions in our service. Interruptions in our service could
reduce our revenues and profits, and our brand could be damaged if people
believe our system is unreliable.
30.
Operational
risks may disrupt our businesses, result in losses or limit our growth.
We may rely heavily on our financial,
accounting and other data processing systems. If any of these systems do not
operate properly or are disabled, we could suffer financial loss, a disruption
of our businesses, liability to our investment funds, regulatory intervention
or reputational damage.
In addition, we plan to operate in
businesses that are highly dependent on information systems and technology. Our
information systems and technology may not continue to be able to accommodate
our growth, and the cost of maintaining such systems may increase from its
current level. Such a failure to accommodate growth, or an increase in costs
related to such information systems, could have a material adverse effect on
us.
Finally, we may rely on third-party
service providers for certain aspects of our business, including for certain
information systems and technology and administration of our hedge funds. Any
interruption or deterioration in the performance of these third parties or
failures of their information systems and technology could impair the quality
of the funds' operations and could impact our reputation and hence adversely
affect our businesses.
31.
Acquisitions
could result in operating difficulties, dilution and other harmful
consequences.
Our
business plan is significantly dependent upon acquisitions of other businesses,
assets, and properties. We do not have a great deal of experience acquiring
companies. We have evaluated, and expect to continue to evaluate, a wide array
of potential strategic transactions. From time to time, we may engage in
discussions regarding potential acquisitions. Any of these transactions could
be material to our financial condition and results of operations. In addition,
the process of integrating an acquired company,
business or technology may create unforeseen operating difficulties and
expenditures and is risky. The areas where we may face risks include:
-
The need to implement or remediate controls,
procedures and policies appropriate for a larger public company at
companies that prior to the acquisition lacked these controls, procedures
and policies.
-
Diversion of management time and focus from
operating our business to acquisition integration challenges.
-
Cultural challenges associated with integrating
employees from the acquired company into our organization.
-
Retaining employees from the businesses we
acquire.
-
The need to integrate each company’s
accounting, management information, human resource and other
administrative systems to permit effective management.
Foreign
acquisitions involve unique risks in addition to those mentioned above,
including those related to integration of operations across different cultures
and languages, currency risks and the particular economic, political and
regulatory risks associated with specific countries. Also, the anticipated
benefit of many of our acquisitions may not materialize. Future acquisitions or
dispositions could result in potentially dilutive issuances of our equity
securities, the incurrence of debt, contingent liabilities or amortization
expenses, or write-offs of goodwill, any of which could harm our financial
condition. Future acquisitions may require us to obtain additional equity or
debt financing, which may not be available on favorable terms or at all.
32.
Our
real estate investments/operations will be subject to the risks inherent in the
ownership and operation of real estate and the construction and development of
real estate.
Our
planned investments in real estate will be subject to the risks inherent in the
ownership and operation of real estate and real estate-related businesses and
assets. These risks include those associated with the burdens of ownership of
real property, general and local economic conditions, changes in supply of and
demand for competing properties in an area (as a result for instance of
overbuilding), fluctuations in the average occupancy and room rates for hotel
properties, the financial resources of tenants, changes in building,
environmental and other laws, energy and supply shortages, various uninsured or
uninsurable risks, natural disasters, changes in government regulations (such
as rent control), changes in real property tax rates, changes in interest
rates, the reduced availability of mortgage funds which may render the sale or
refinancing of properties difficult or impracticable, negative developments in
the economy that depress travel activity, environmental liabilities, contingent
liabilities on disposition of assets, terrorist attacks, war and other factors
that are beyond our control. In addition, if our real estate investments/operations
acquire direct or indirect interests in undeveloped land or underdeveloped real
property, which may often be non-income producing, they will be subject to the
risks normally associated with such assets and development activities,
including risks relating to the availability and timely receipt of zoning and
other regulatory or environmental approvals, the cost and timely completion of
construction (including risks beyond the control of our fund, such as weather
or labor conditions or material shortages) and the availability of both
construction and permanent financing on favorable terms.
33.
We
may occasionally become subject to commercial disputes that could harm our
business.
As
we move ahead to execute our business plan, we may become engaged in disputes
regarding our commercial transactions. These disputes could result in monetary
damages or other remedies that could adversely impact our financial position or
operations. Even if we prevail in these disputes, they may distract our
management from operating our business.
34.
We
have to keep up with rapid technological change to remain competitive.
Our future success will depend on our
ability to adapt to rapidly changing technologies, to adapt our services to
evolving industry standards and to improve the performance and reliability of
our services. Our failure to adapt to such changes would harm our business.
35.
We
may be subject to substantial
litigation risks and may face significant liabilities and damage to our
professional reputation as a result of litigation allegations and negative
publicity from our type of business.
The investment or acquisition decisions
we may make as we execute our business plan may subject us to the risk of
third-party litigation arising from minority shareholders’ actions or investor
dissatisfaction with the activities of our business and a variety
of other litigation claims. For example, from time to time we and our portfolio
companies may be subject to class action suits by shareholders in public
companies that we might have agreed to acquire that challenge our acquisition
transactions and attempt to enjoin them.
36.
Employee
misconduct could harm us
by impairing our ability to attract and retain clients and subjecting us to
significant legal liability and reputational harm.
There is a risk that our employees could
engage in misconduct that adversely affects our business. We may be subject to
a number of obligations and standards arising from our acquisition, mergers and
assets turnaround management business. If one of our employees were to engage
in misconduct or were to be accused of such misconduct, our business and our
reputation could be adversely affected.
37.
We
are subject to the periodic reporting requirements of the Exchange Act that
will require us to incur audit fees and legal fees in connection with the
preparation of such reports. These additional costs could reduce or eliminate
our ability to earn a profit.
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Following
the effective date of our registration statement of which this prospectus is a
part, we will be required to file periodic reports with the SEC pursuant to the
Exchange Act and the rules and regulations promulgated thereunder. In order to
comply with these requirements, our independent registered public accounting
firm will have to review our financial statements on a quarterly basis and
audit our financial statements on an annual basis. Moreover, our legal counsel
will have to review and assist in the preparation of such reports. The costs
charged by these professionals for such services cannot be accurately predicted
at this time because factors such as the number and type of transactions that
we engage in and the complexity of our reports cannot be determined at this
time and will have a major effect on the amount of time to be spent by our
auditors and attorneys. However, the incurrence of such costs will obviously be
an expense to our operations and thus have a negative effect on our ability to
meet our overhead requirements and earn a profit. We may be exposed to
potential risks resulting from any new requirements under Section 404 of
the Sarbanes-Oxley Act of 2002. If we cannot provide reliable financial reports
or prevent fraud, our business and operating results could be harmed, investors
could lose confidence in our reported financial information, and the trading
price of our common stock, if a market ever develops, could drop significantly.
38.
Our
internal controls may be inadequate, which could cause our financial
reporting to be unreliable and lead to misinformation being disseminated to
the public.
|
Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting. As defined in Exchange Act Rule 13a-15(f),
internal control over financial reporting is a process designed by, or under
the supervision of, the principal executive and principal financial officer and
effected by the board of directors, management and other personnel, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with generally
accepted accounting principles and includes those policies and procedures that:
·
|
pertain
to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of our assets;
|
·
|
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 management and/or our directors;
and
|
·
|
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.
|
We
will rely on the use of outside professionals to assist us in maintaining our
internal controls. With growth or unmanageable increases in our business plan
objectives, our internal controls may be inadequate or ineffective, which could
cause our financial reporting to be unreliable and lead to misinformation being
disseminated to the public. Investors relying upon this
misinformation may make an uninformed investment decision with regards to an
investment in our common stock.
In order to mitigate
the risks associated with maintaining internal controls if and when the Company
grows, we will engage qualified professionals on an independent contractor
basis to assist in reviewing and recording transactions. When and if finances
permit, we will hire an experienced financial professional to oversee our
reporting and control functions.
Failure to achieve and maintain an effective internal control
environment could cause us to face regulatory action and also cause investors
to lose confidence in our reported financial information, either of which could
have a material adverse effect on the Company’s business, financial condition,
results of operations and future prospects.
However, our auditors will not be required to formally attest to
the effectiveness of our internal control over financial reporting pursuant to
Section 404 until we are no longer an “emerging growth company” as defined in
the JOBS Act if we take advantage of the exemptions available to us through the
JOBS Act.
39.
If
GiveMePower Corporation, Inc. were deemed an "investment company"
under the 1940 Act, applicable restrictions could make it impractical for us to
continue our business as contemplated and could have a material adverse effect
on our business.
A person will generally be deemed to be
an "investment company" for purposes of the 1940 Act if:
• it is or holds itself out as being
engaged primarily, or proposes to engage primarily, in the business of
investing, reinvesting or trading in securities; or
• absent an applicable exemption, it
owns or proposes to acquire investment securities having a value exceeding 40%
of the value of its total assets (exclusive of U.S. government securities and
cash items) on an unconsolidated basis.
We believe that we will be engaged
primarily in the business of acquiring businesses and investing in businesses
with the intent to gain control of the investee in other to implement our
turnaround business-process improvement on the target business. We do not
intend to engage in the business of investing, reinvesting or trading in
securities. We also believe that the primary source of income from each of our
business platform will be properly characterized as income earned in exchange
for the provision of services. We intend to hold ourselves out as a business acquirer
and do not propose to engage primarily in the business of investing,
reinvesting or trading in securities. Accordingly, we do not believe that GiveMePower
Corporation, Inc. is, or will be, an "orthodox" investment company
as defined in section 3(a)(1)(A) of the 1940 Act and described in the
first bullet point above. Furthermore, we do not believe GiveMePower Corporation,
Inc. is, or will be, an inadvertent investment company by virtue of the 40%
test in section 3(a)(1)(C) of the 1940 Act as described in the second
bullet point above.
The 1940 Act and the rules thereunder
contain detailed parameters for the organization and operation of investment
companies. Among other things, the 1940 Act and the rules thereunder limit or
prohibit transactions with affiliates, impose limitations on the issuance of
debt and equity securities, generally prohibit the issuance of options and
impose certain governance requirements. We intend to conduct our operations so
that GiveMePower Corporation, Inc. will not be deemed to be an investment
company under the 1940 Act. If anything were to happen which would cause GiveMePower
Corporation, Inc. to be deemed to be an investment company under the 1940 Act,
requirements imposed by the 1940 Act, including limitations on our capital
structure, ability to transact business with other businesses and ability to
compensate key employees, could make it impractical for us to continue our
business as currently conducted, or any combination thereof, and materially
adversely affect our business, financial condition and results of operations.
In addition, we may be required to limit the amount of investments that we make
as a principal or otherwise conduct our business in a manner that does not
subject us to the registration and other requirements of the 1940 Act.
40.
Our
non-controlling investments
will in most cases rank junior to investments made by others.
In most cases, the companies in which we
invest without acquiring controlling stakes, will have indebtedness or equity
securities, or may be permitted to incur indebtedness or to issue equity
securities, that rank senior to our investment. By their terms, such
instruments may provide that their holders are entitled to receive payments of
dividends, interest or principal on or before the dates on which payments are
to be made in respect of our investment. Also, in the event of insolvency,
liquidation, dissolution, reorganization or bankruptcy of a company in which an
investment is made, holders of securities ranking senior to our investment
would typically be entitled to receive payment in full before distributions
could be made in respect of our investment. After repaying senior security
holders, the company may not have any remaining assets to use for repaying
amounts owed in respect of our investment. To the extent that any assets
remain, holders of claims that rank equally with our
investment would be entitled to share on an equal and ratable basis in
distributions that are made out of those assets. Also, during periods of
financial distress or following insolvency, our ability to influence a
company's affairs and to take actions to protect our investments may be
substantially less than that of the senior creditors.
41.
Risk
management activities may adversely
affect the return on our investments.
When managing our exposure to market
risks, we may from time to time use forward contracts, options, swaps, caps,
collars and floors or pursue other strategies or use other forms of derivative
instruments to limit our exposure to changes in the relative values of
investments that may result from market developments, including changes in
prevailing interest rates, currency exchange rates and commodity prices. The
success of any hedging or other derivative transactions generally will depend
on our ability to correctly predict market changes, the degree of correlation
between price movements of a derivative instrument, the position being hedged,
the creditworthiness of the counterparty, and other factors. As a result, while
we may enter into a transaction in order to reduce our exposure to market
risks, the transaction may result in poorer overall financial performance than
if it had not been executed. Such transactions may also limit the opportunity
for gain if the value of a hedged position increases.
42.
Valuation
methodologies for certain
assets we in our portfolio can be subject to significant subjectivity and the
values of assets established pursuant to such methodologies may never be
realized, which could result in significant losses for our funds.
There are no readily ascertainable
market prices for a very large number of illiquid investments of our private
equity, real estate and mezzanine operations. We intend to determine the value
of the investments of each of our private equity, real estate and mezzanine
operations on a periodic basis based on the fair value of such investments. The
fair value of investments of a private equity, real estate or mezzanine debt
will be determined using a number of methodologies described in the
investments' valuation policies. We intend to make valuation determinations
historically without the assistance of an independent valuation firm, although
an independent valuation firm may participate in valuation determinations in
the future.
There is no single standard for
determining fair value in good faith and, in many cases, fair value is best
expressed as a range of fair values from which a single estimate may be
derived. The types of factors that may be considered when applying fair value
pricing to an investment in a particular company include the historical and
projected financial data for the company, valuations given to comparable
companies, the size and scope of the company's operations, the strengths and
weaknesses of the company, expectations relating to investors' demand for an
offering of the company's securities, the size of our investment in the
portfolio company and any control associated therewith, information with
respect to transactions or offers for the portfolio company's securities
(including the transaction pursuant to which the investment was made and the
period of time that has elapsed from the date of the investment to the
valuation date), applicable restrictions on transfer, industry information and
assumptions, general economic and market conditions, the nature and realizable
value of any collateral or credit support and other relevant factors. Fair values
may be established using a market multiple approach that is based on a specific
financial measure (such as earnings before interest, taxes, depreciation and
amortization, or "EBITDA," adjusted EBITDA, cash flow, net income,
revenues or net asset value) or, in some cases, a cost basis or a discounted
cash flow or liquidation analysis.
In addition, we determine the fair value
of a number of our investments based on a variety of valuation methodologies.
Because valuations, and in particular valuations of investments for which
market quotations are not readily available, are inherently uncertain, may
fluctuate over short periods of time and may be based on estimates,
determinations of fair value may differ materially from the values that would
have resulted if a ready market had existed. Even if market quotations are
available for our portfolio businesses, such quotations may not reflect the
value that we would actually be able to realize because of various factors,
including the possible illiquidity associated with a large ownership position
or legal restrictions on transfer. In addition, because many of the illiquid
investments will be in industries or companies which are cyclical, undergoing
some uncertainty or distress or otherwise subject to volatility, such
investments are subject to rapid changes in value caused by sudden
company-specific or industry-wide developments.
Because
there is significant uncertainty in the valuation of, or in the stability of
the value of illiquid investments, the fair values of such investments as
reflected in our asset value do not necessarily reflect the prices that would
actually be obtained by us when such investments are realized. Changes in
values attributed to investments from quarter to quarter may result in volatility
in our enterprise value and results of operations that we report from period to
period. Also, a situation where asset values turn out to be materially
different than values reflected in prior business values could cause investors
to lose confidence in us, which would in turn result in difficulty in raising
additional funds.
Risks Related to
Our Common Stock
1.
An active
trading market may not develop in the future.
The
market price of our common stock is highly volatile and is subject to wide fluctuations
in response to factors such as actual or anticipated changes in operating
results, changes in financial estimates by securities analysts, new products
or services introduced by the company or our competitors, conditions and
trends in the software markets, general market conditions and other factors.
Historically, the trading volume of our stock has been low, which may amplify
changes in our stock price especially if a significant amount of our stock is
sold. Our stock trades on the OTC Pink Sheet, which may make if more difficult
for investors to trade our stock, or to obtain accurate quotations for the
market value of our stock as compared to stock which trades on larger
exchanges.
2.
An
active trading market may not develop in the future.
An
active trading market may not develop or, if developed, may not be
sustained. The lack of an active market may impair your
ability to sell your shares of common stock at the time you wish to sell them
or at a price that you consider reasonable. The lack of an
active market may also reduce the market value and increase the volatility of
your shares of common stock. An inactive market may also
impair our ability to raise capital by selling shares of common stock and may
impair our ability to acquire other companies or assets by using shares of our
common stock as consideration.
3.
Our
Common Stock is subject to the “Penny Stock” rules of the SEC and trading
market in our securities is limited, which makes transactions in our stock
cumbersome and may reduce the value of an investment in our stock.
The
Securities and Exchange Commission has adopted Rule 15g-9 which establishes the
definition of a "penny stock," for the purposes relevant to us, as
any equity security that has a market price of less than $5.00 per share or
with an exercise price of less than $5.00 per share, subject to certain
exceptions. For any transaction involving a penny stock, unless exempt, the
rules require:
o
that
a broker or dealer approve a person's account for transactions in penny stocks;
and
o
the
broker or dealer receive from the investor a written agreement to the
transaction, setting forth the identity and quantity of the penny stock to be
purchased.
o
In
order to approve a person's account for transactions in penny stocks, the broker
or dealer must:
o
obtain
financial information and investment experience objectives of the person; and
o
make
a reasonable determination that the transactions in penny stocks are suitable
for that person and the person has sufficient knowledge and experience in
financial matters to be capable of evaluating the risks of transactions in
penny stocks.
o
The
broker or dealer must also deliver, prior to any transaction in a penny stock,
a disclosure schedule prescribed by the Commission relating to the penny stock
market, which, in highlight form:
o
sets
forth the basis on which the broker or dealer made the suitability
determination; and
o
that
the broker or dealer received a signed, written agreement from the investor
prior to the transaction.
Generally,
brokers may be less willing to execute transactions in securities subject to
the "penny stock" rules. This may make it more difficult for
investors to dispose of our common stock and cause a decline in the market
value of our stock.
Disclosure
also has to be made about the risks of investing in penny stocks in both public
offerings and in secondary trading and about the commissions payable to both
the broker-dealer and the registered representative, current quotations for the
securities and the rights and remedies available to an investor in cases of
fraud in penny stock transactions. Finally, monthly statements have to be sent
disclosing recent price information for the penny stock held in the account and
information on the limited market in penny stocks.
4.
Because our Chief Executive Officer owns
a controlling interest in our company, he controls our company and is able to
designate our directors and officers and control all major decisions and
corporate actions and so long as our Chief Executive Officer retains ownership
of a majority of our voting shares you will not be able to elect any directors
or have a meaningful say in any major decisions or corporate actions which
could decrease the price and marketability of our shares.
Our Chief Executive Officer owns preferred
shares of our common stock constituting approximately 60% of our voting shares.
As a result our Chief Executive Officer is able to elect all of our directors,
appoint all of our officers, control the shareholder vote on any major decision
or corporate action and control our operations. Our Chief Executive Officer can
unilaterally decide major corporate actions such as mergers, acquisitions,
future securities offerings, amendments to our operating agreement and other
significant company events. Our Chief Executive Officer’s unilateral control
over us could decrease the price and marketability of our common shares.
5.
Finra
sales practice requirements may limit a stockholder’s ability to buy and sell
our stock.
The
Financial Industry Regulatory Authority, or Finra, has adopted rules that
require that in recommending an investment to a customer, a broker/dealer must
have reasonable grounds for believing that the investment is suitable for that
customer. Prior to recommending speculative low-priced securities (commonly
referred to as penny stock) to their non-institutional customers,
broker/dealers must make reasonable efforts to obtain information about the
customer’s financial status, tax status, investment objectives and other
information. Under interpretations of these rules, Finra
believes that there is a high probability that speculative low-priced
securities will not be suitable for at least some
customers. Finra requirements will make it more difficult for
broker/dealers to recommend that their customers buy our common stock when
traded, which may have the effect of reducing the level of trading activity and
liquidity of our common stock in the future. Further, many
brokers charge higher fees for these speculative low-priced securities
transactions. As a result, fewer broker/dealers may be willing to make a market
in our common stock, reducing a stockholder’s ability to resell shares of our
common stock.
6.
The
costs of being a public company could result in us being unable to continue operation.
As
a public company, we will have to comply with numerous financial reporting and
legal requirements, including those pertaining to audits and internal control.
The costs of this compliance could be significant. The
costs of maintaining the public company requirements could be significant and
may preclude us from seeking financing or equity investment on acceptable
terms. We estimate these costs will range up to $150,000 per year and may be
higher if our business volume and activity ever increases. Our estimate of
costs do not include the necessary compliance, documentation and reporting
requirements for Section 404 as we will not be subject to the full reporting
requirements of Section 404 until we exceed $75 million in market
capitalization if we decide to opt-out of the “emerging growth company” as
defined in the JOBS Act to take advantage of the exemptions available to us
through the JOBS Act or we have been public for more than five years. If
our revenues are insufficient, and/or we cannot satisfy many of these costs
through the issuance of our shares, we may be unable to satisfy these costs in
the normal course of business that would result in our being unable to continue
operation.
7.
We
may not be able to raise sufficient financing or resources to acquire and
manage the three retail businesses that we have identified and determined to
fit our investment/acquisition criteria.
We may not be able to raise sufficient financing or resources to acquire
and manage the three aftermarket auto parts retail businesses that we have
determined to fit our investment/acquisition criteria. We currently have no
commitments for any funds. If we are unable to raise sufficient financing or
resources to acquire and manage even one of the aftermarket auto parts retail
businesses or other targets, our business will fail and investors could lose
their entire investment.
8.
Shareholders
may be diluted significantly through our efforts to obtain financing and
satisfy obligations through issuance of additional shares of our common stock.
We have no committed source of financing. Wherever possible, our
board of directors will attempt to use non-cash consideration to satisfy
obligations. In many instances, we believe that the non-cash consideration will
consist of restricted shares of our common stock. Our board of directors has
authority, without action or vote of the shareholders, to issue all or part of
the authorized (50,000,000) shares but unissued (21,275,313) shares. If a
trading market develops for our common stock, we may
attempt to raise capital by selling shares of our common stock, possibly at a
discount to market. These actions will certainly result in dilution of the
ownership interests of existing shareholders, further dilute common stock book
value, and that this dilution may be material.
9.
The
interests of shareholders may be hurt because we can issue shares of our common
stock to individuals or entities that support existing management with such
issuances serving to enhance existing management’s ability to maintain control
of our company.
Our board of directors has authority, without action or vote of
the shareholders, to issue all or part of the authorized but unissued common
shares. Such issuances may be issued to parties or entities committed to
supporting existing management and the interests of existing management which
may not be the same as the interests of other shareholders. Our ability to
issue shares without shareholder approval serves to enhance existing
management’s ability to maintain control of our company.
10.
Participation
is subject to risks of investing in micro capitalization companies.
We
believe that certain micro capitalization companies have significant potential
for growth, although such companies generally have limited product lines,
markets, market shares and financial resources. The securities of such
companies, if traded in the public market, may trade less frequently and in
more limited volume than those of more established companies. Additionally, in
recent years, the stock market has experienced a high degree of price and
volume volatility for the securities of micro capitalization
companies. In particular, micro capitalization companies that trade
in the over-the-counter markets have experienced wide price fluctuations not
necessarily related to the operating performance of such companies.
11.
Currently,
there is no established public market for our securities, and there can be no
assurances that any established public market will ever develop or that our
common stock will be quoted for trading and, even if quoted, it is likely to
be subject to significant price fluctuations.
|
Prior
to the date of this prospectus, there has not been any established trading
market for our common stock, and there is currently no established public
market whatsoever for our securities. We have not entered into any agreement
with a market maker to file an application with FINRA on our behalf so as to be
able to quote the shares of our common stock on the OTCBB maintained by FINRA
commencing upon the effectiveness of our registration statement. There can be
no assurance that we will subsequently identify an market maker and, to the
extent that we identify one, enter into an agreement with it to file an
application with FINRA or that the market maker’s application will be accepted
by FINRA. We cannot estimate the time period that the application will require
for FINRA to approve it. We are not permitted to file such application on our
own behalf. If the application is accepted, there can be no assurances as to
whether:
(i)
|
any
market for our shares will develop;
|
(ii)
|
the
prices at which our common stock will trade; or
|
(iii)
|
the
extent to which investor interest in us will lead to the development of an
active, liquid trading market. Active trading markets generally result in
lower price volatility and more efficient execution of buy and sell orders
for investors.
|
If
we are able to have our shares of common stock quoted on the OTCBB, we will
then try, through a broker-dealer and its clearing firm, to become eligible
with the Depository Trust Company ("DTC") to permit our shares to
trade electronically. If an issuer is not “DTC-eligible,” then its shares
cannot be electronically transferred between brokerage accounts, which, based
on the realities of the marketplace as it exists today (especially the OTCBB),
means that shares of a company will not be traded (technically the shares can
be traded manually between accounts, but this takes days and is not a realistic
option for companies relying on broker dealers for stock transactions - like
all companies on the OTCBB. What this boils down to is that while
DTC-eligibility is not a requirement to trade on the OTCBB), it is a necessity
to process trades on the OTCBB if a company’s stock is going to trade with any
volume. There are no assurances that our shares will ever become DTC-eligible
or, if they do, how long it will take.
In
addition, our common stock is unlikely to be followed by any market analysts,
and there may be few institutions acting as market makers for our common stock.
Either of these factors could adversely affect the liquidity and trading price
of our common stock. Until our common stock is fully distributed and an orderly
market develops in our common stock, if ever, the price
at which it trades is likely to fluctuate significantly. Prices for our common
stock will be determined in the marketplace and may be influenced by many
factors, including the depth and liquidity of the market for shares of our
common stock, developments affecting our business, including the impact of the
factors referred to elsewhere in these Risk Factors, investor perception of us
and general economic and market conditions. No assurances can be given that an
orderly or liquid market will ever develop for the shares of our common stock.
Because
of the anticipated low price of the securities being registered, many brokerage
firms may not be willing to effect transactions in these securities. Purchasers
of our securities should be aware that any market that develops in our stock
would be subject to the penny stock restrictions. See “Plan of Distribution”
and “Risk Factors.”
12.
Trading
in shares of our common stock is subject to the penny stock regulations and
restrictions pertaining to low priced stocks that will create a lack of
liquidity and make trading difficult or impossible.
|
The
trading of shares of our common stocks occurs on the over-the-counter market,
which is commonly referred to as the OTC market as maintained by FINRA. As a
result, an investor may find it difficult to dispose of, or to obtain accurate
quotations as to the price of our securities.
Rule
3a51-1 of the Exchange Act establishes the definition of a "penny
stock," for purposes relevant to us, as any equity security that has a
minimum bid price of less than $4.00 per share or with an exercise price of
less than $4.00 per share, subject to a limited number of exceptions that are
not available to us. It is likely that our shares will be considered to be
penny stocks for the immediately foreseeable future. This classification
severely and adversely affects any market liquidity for our common stock.
For
any transaction involving a penny stock, unless exempt, the penny stock rules
require that a broker or dealer approve a person's account for transactions in
penny stocks and the broker or dealer receive from the investor a written
agreement to the transaction setting forth the identity and quantity of the
penny stock to be purchased. In order to approve a person's account for
transactions in penny stocks, the broker or dealer must obtain financial
information and investment experience and objectives of the person and make a
reasonable determination that the transactions in penny stocks are suitable for
that person and that that person has sufficient knowledge and experience in
financial matters to be capable of evaluating the risks of transactions in
penny stocks.
The
broker or dealer must also deliver, prior to any transaction in a penny stock,
a disclosure schedule prepared by the SEC relating to the penny stock market,
which, in highlight form, sets forth:
·
|
the
basis on which the broker or dealer made the suitability determination, and
|
·
|
that
the broker or dealer received a signed, written agreement from the investor
prior to the transaction.
|
Disclosure
also has to be made about the risks of investing in penny stock in both public
offerings and in secondary trading and commissions payable to both the
broker-dealer and the registered representative, current quotations for the
securities and the rights and remedies available to an investor in cases of
fraud in penny stock transactions. Additionally, monthly statements have to be
sent disclosing recent price information for the penny stock held in the
account and information on the limited market in penny stocks.
Because
of these regulations, broker-dealers may not wish to engage in the
above-referenced necessary paperwork and disclosures and/or may encounter
difficulties in their attempt to sell shares of our common stock, which may
affect the ability of selling shareholders or other holders to sell their
shares in any secondary market and have the effect of reducing the level of
trading activity in any secondary market. These additional sales practice and
disclosure requirements could impede the sale of our securities, if and when
our securities become publicly traded. In addition, the liquidity for our
securities may decrease, with a corresponding decrease in the price of our
securities. Our shares, in all probability, will be subject to such penny stock
rules for the foreseeable future and our shareholders will, in all likelihood,
find it difficult to sell their securities.
13.
The
market for penny stocks has experienced numerous frauds and abuses that could
adversely impact investors in our stock.
|
Our
management believes that the market for penny stocks has suffered from patterns
of fraud and abuse. Such patterns include:
·
Control
of the market for the security by one or a few broker-dealers that are often
related to the promoter or issuer;
·
Manipulation
of prices through prearranged matching of purchases and sales and false and
misleading press releases;
·
"Boiler
room" practices involving high pressure sales tactics and unrealistic
price projections by sales persons;
·
Excessive
and undisclosed bid-ask differentials and markups by selling broker-dealers;
and
·
Wholesale
dumping of the same securities by promoters and broker-dealers after prices
have been manipulated to a desired level, along with the inevitable collapse of
those prices with consequent investor losses.
14.
Any
trading market that may develop may be restricted by virtue of state securities
“Blue Sky” laws that prohibit trading absent compliance with individual state
laws. These restrictions may make it difficult or impossible to sell shares in
those states.
Transfer
of our common stock may also be restricted under the securities or securities
regulations laws promulgated by various states and foreign jurisdictions,
commonly referred to as “Blue Sky” laws. Absent compliance with such individual
state laws, our common stock may not be traded in such jurisdictions. Because
the securities registered hereunder have not been registered for resale under
the blue sky laws of any state, the holders of such shares and persons who
desire to purchase them in any trading market that might develop in the future,
should be aware that there may be significant state blue sky law restrictions
upon the ability of investors to sell the securities and of purchasers to
purchase the securities. These restrictions prohibit the secondary trading of
our common stock. We currently do not intend to and may not be able to qualify
securities for resale in at least 17 states which do not offer manual
exemptions (or may offer manual exemptions but may not to offer one to us if we
are considered to be a shell company at the time of application) and require
shares to be qualified before they can be resold by our shareholders.
Accordingly, investors should consider the secondary market for our securities
to be a limited one. See also “Plan of Distribution-State Securities-Blue Sky
Laws.”
15.
The
ability of our president to control our business may limit or eliminate
minority shareholders’ ability to influence corporate affairs.
Our president beneficially controls approximately 60% of our voting
stock, and our president will be in a position to continue to elect our board
of directors, decide all matters requiring stockholder approval and determine
our policies. The interests of our president may differ from the interests of
other shareholders with respect to the issuance of shares, business
transactions with or sales to other companies, selection of officers and
directors and other business decisions. The minority shareholders would have no
way of overriding decisions made by our president. This level of control may
also have an adverse impact on the market value of our shares because our
president may institute or undertake transactions, policies or programs that
may result in losses, may not take any steps to increase our visibility in the
financial community and/or may sell sufficient numbers of shares to
significantly decrease our price per share.
16.
Our
bylaw provide for indemnification of officers and directors at our expense
and limit their liability that may result in a major cost to us and hurt the
interests of our shareholders because corporate resources may be expended for
the benefit of officers and/or directors.
|
Article
IV of our bylaw provide for indemnification as follows: “The corporation shall,
to the maximum extent and in the manner permitted by the Code, indemnify each
of its directors and officers against expenses (as defined in Section 317(a) of
the Code), judgments, fines, settlements, and other amounts actually and
reasonably incurred in connection with any proceeding (as defined in Section
317(a) of the Code), arising by reason of the fact that such person is or was
an agent of the corporation.” The Corporation is authorized to provide
indemnification of agents (as defined in Section 317 of the Corporations Code)
for breach of duty to the Corporation and its stockholders through bylaw
provisions or through agreements with agents, or both, in excess of the
indemnification otherwise permitted by Section 317 of the Corporations Code,
subject to the limits of such excess indemnification set forth in Section 204
of the Corporations Code.”
We
have been advised that, in the opinion of the SEC, indemnification for
liabilities arising under federal securities laws is against public policy as
expressed in the Securities Act of 1933 and is, therefore, unenforceable. In
the event that a claim for indemnification for liabilities arising under
federal securities laws, other than the payment by us of expenses incurred or
paid by a director, officer or controlling person in the successful defense of
any action, suit or proceeding, is asserted by a director, officer or
controlling person in connection with our activities, we will (unless in the
opinion of our counsel, the matter has been settled by controlling precedent)
submit to a court of appropriate jurisdiction, the question whether
indemnification by us is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue. The legal process relating to this matter if it were to occur
is likely to be very costly and may result in us receiving negative publicity,
either of which factors is likely to materially reduce the market and price for
our shares, if such a market ever develops.
Our board of directors has authority, without action or vote of
the shareholders, to issue all or part of the authorized but unissued common
shares.
17.
We
may issue additional debt and equity securities, which are senior to our common
shares as to distributions and in liquidation, which could materially adversely
affect the market price of our common shares.
In
the future, we may attempt to increase our capital resources by entering into
additional debt or debt-like financing that is secured by all or up to all of
our assets, or issuing debt or equity securities, which could include issuances
of commercial paper, medium-term notes, senior notes, subordinated notes or
shares. In the event of our liquidation, our lenders and holders of our debt
securities would receive a distribution of our available assets before
distributions to our shareholders. Any preferred securities, if issued by our
company, may have a preference with respect to distributions and upon
liquidation, which could further limit our ability to make distributions to our
shareholders. Because our decision to incur debt and issue securities in our
future offerings will depend on market conditions and other factors beyond our
control, we cannot predict or estimate the amount, timing or nature of our
future offerings and debt financing.
Further,
market conditions could require us to accept less favorable terms for the
issuance of our securities in the future. Thus, you will bear the risk of our
future offerings reducing the value of your common shares and diluting your
interest in us. In addition, we can change our leverage strategy from time to
time without approval of holders of our common shares, which could materially
adversely affect the market share price of our common shares.
18.
We
do not expect to pay cash dividends in the foreseeable future.
|
We
have never paid cash dividends on our common stock. We do not expect to pay
cash dividends on our common stock at any time in the foreseeable future. The
future payment of dividends directly depends upon our future earnings, capital
requirements, financial requirements and other factors that our President and
CEO will consider. Since we do not anticipate paying cash dividends on our
common stock, return on your investment, if any, will depend solely on an
increase, if any, in the market value of our common stock.
19.
Investment
Risks
An
investment in our common units involves substantial risks and uncertainties.
Some of the more significant challenges and risks include those associated with
our susceptibility to conditions in the global financial markets and global
economic conditions, the volatility of our revenue, net income and cash flow,
our dependence on our founders and other key senior managing directors and our
ability to retain and motivate our existing senior managing directors and
recruit, retain and motivate new senior managing directors in the future. See
"Risk Factors" for a discussion of the factors you should consider
before investing in our common
20.
Because
we are not subject to compliance with rules requiring the adoption of certain
corporate governance measures, our stockholders have limited protection against
interested director transactions, conflicts of interest and similar matters.
The
Sarbanes-Oxley Act of 2002, as well as rule changes proposed and enacted by the
SEC, the New York and American Stock Exchanges and the Nasdaq Stock Market, as
a result of Sarbanes-Oxley, requires the implementation of various measures
relating to corporate governance. These measures are designed to enhance the
integrity of corporate management and the securities markets and apply to
securities that are listed on those exchanges or the Nasdaq Stock Market.
Because we are not presently required to comply with many of the corporate
governance provisions and because we chose to avoid incurring the substantial additional
costs associated with such compliance any sooner than legally required, we have
not yet adopted these measures.
Because
our President and CEO is not an independent director, we do not currently have
independent audit or compensation committees. As a result, our President and
CEO has the ability, among other things, to determine his own level of
compensation. Until we comply with such corporate governance measures,
regardless of whether such compliance is required, the
absence of such standards of corporate governance may leave our stockholders
without protections against interested director transactions, conflicts of
interest, if any, and similar matters and investors may be reluctant to provide
us with funds necessary to expand our operations.
We
intend to comply with all corporate governance measures relating to director
independence as and when required. However, we may find it very difficult or be
unable to attract and retain qualified officers, directors and members of board
committees required to provide for our effective management as a result of
Sarbanes-Oxley Act of 2002. The enactment of the Sarbanes-Oxley Act of 2002 has
resulted in a series of rules and regulations by the SEC that increase
responsibilities and liabilities of directors and executive officers. The
perceived increased personal risk associated with these recent changes may make
it more costly or deter qualified individuals from accepting these roles.
21.
You
may have limited access to information regarding our business because our
obligations to file periodic reports with the SEC could be automatically
suspended under certain circumstances.
|
As
of the effective date of our registration statement of which this prospectus is
a part, we will become subject to certain informational requirements of the
Exchange Act, as amended and we will be required to file periodic reports
(i.e., annual, quarterly and special reports) with the SEC which will be
immediately available to the public for inspection and copying. Except during
the year that our registration statement becomes effective, these reporting
obligations may (in our sole discretion) be automatically suspended under
Section 15(d) of the Exchange Act if we have less than 300 shareholders and do
not file a registration statement on Form 8A. If this occurs after the year in
which our registration statement becomes effective, we will no longer be
obligated to file periodic reports with the SEC and your access to our business
information would then be even more restricted. After this registration
statement on Form S-1 becomes effective, we may be required to deliver periodic
reports to security holders. However, we will not be required to furnish proxy
statements to security holders and our director, officers and principal
beneficial owners will not be required to report their beneficial ownership of
securities to the SEC pursuant to Section 16 of the Exchange Act until we have
both 500 or more security holders and greater than $10 million in assets. This
means that your access to information regarding our business will be limited.
If we do not file a form 8A. We intend to file the form 8A.
22.
We
will incur ongoing costs and expenses for SEC reporting and compliance, without
revenue we may not be able to remain in compliance, making it difficult for
investors to sell their shares, if at all.
We
plan to uplist our shares to the OTCBB or QB. To be eligible for quotation on
the OTCBB, issuers must remain current in their filings with the SEC. Market
makers are not permitted to begin quotation of a security whose issuer does not
meet this filing requirement. Securities already quoted on the OTCBB that
become delinquent in their required filings will be removed following a 30 or
60 day grace period if they do not make their required filing during that time.
In order for us to remain in compliance we will require future revenues to
cover the cost of these filings, which could comprise a substantial portion of
our available cash resources. If we are unable to generate sufficient revenues
to remain in compliance it may be difficult for you to resell any shares you
may purchase, if at all.
23.
An
investment in our common stock is speculative and there can be no assurance of
any return on any such investment.
An
investment in our common stock is speculative and there is no assurance that
investors will obtain any return on their investment. Investors will be subject
to substantial risks involved in an investment in our Company, including the
risk of losing their entire investment.
24. Reports
to Security Holders
Although
we are not required to deliver our annual or quarterly reports to security
holders, we would be pleased to forward this information to security holders
upon receiving a written request to receive such information. The reports and
other information filed by us will be available for inspection and copying at
the public reference facilities of the Securities and Exchange Commission
located at 100 F Street, N.E., Washington, D.C. 20549.
Copies
of such material may be obtained by mail from the Public Reference Section of
the Securities and Exchange Commission at 100 F Street, N.E., Washington, D.C.
20549, at prescribed rates. Information on the operation of the Public
Reference Room may be obtained by calling the SEC at 1-800-SEC-0330. In
addition, the Commission maintains a World Wide
Website on the Internet at: http://www.sec.gov that contains reports, proxy and
information statements and other information regarding registrants that file electronically
with the Securities and Exchange Commission.
CAUTIONARY NOTE
REGARDING FORWARD-LOOKING STATEMENTS
Included
in this annual report are “forward-looking” statements, as well as historical
information. Although we believe that the expectations
reflected in these forward-looking statements are reasonable, we cannot assure
you that the expectations reflected in these forward-looking statements will
prove to be correct. Our actual results could differ
materially from those anticipated in forward-looking statements as a result of
certain factors, including matters described in the section titled “Risk
Factors.” Forward-looking statements include those that use
forward-looking terminology, such as the words “anticipate,” “believe,” “estimate,”
“expect,” “intend,” “may,” “project,” “plan,” “will,” “shall,” “should” and
similar expressions, including when used in the
negative. Although we believe that the expectations reflected
in these forward-looking statements are reasonable and achievable, these
statements involve risks and uncertainties and no assurance can be given that
actual results will be consistent with these forward-looking
statements. Actual results may be materially different than
those described in this annual report. Important factors that
could cause our actual results, performance or achievements to differ from
these forward-looking statements include the factors described in the “Risk
Factors” section and elsewhere in this annual report.
All
forward-looking statements attributable to us are expressly qualified in their
entirety by these and other factors. Except as required by
federal securities laws, we undertake no obligation to update or revise these
forward-looking statements, whether to reflect events or circumstances after
the date initially filed or published, to reflect the occurrence of
unanticipated events or otherwise.
ITEM 1B.
|
UNRESOLVED STAFF COMMENTS
|
None
We
do not own any property as at the date of filing we have no properties. Our principal
business, executive and registered statutory office is located at 370 Amapola
Ave., Suite 200A, Torrance, CA 90501 and our telephone number is (310) 895-1839
and email contact is invest@cbdxfund.com..
ITEM 3.
|
LEGAL PROCEEDINGS
|
As
of December 31, 2019, we are not involved in any pending or threatened legal
proceedings.
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
Not
applicable
PART II
ITEM 5.
|
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED
STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
Common
Stock
We are authorized to issue 50,000,000 shares of
common stock, with $0.001 par value per share and 1,000,000 preferred shares,
with $0.001 par value. As of December 31, 2019, there were 1 share of
preferred shares and 27,724,684 shares of common stock issued and outstanding
held by 158 stockholders of record.
Market
Information
Our
common stock is currently quoted on the OTC Pink under the trading symbol “GMPW”.
Trading in stocks quoted on the OTC Pink is often thin and is characterized by
wide fluctuations in trading prices due to many factors that may have little to
do with a company’s operations or business prospects. We cannot assure you that
there will be a market for our common stock in the future.
The
market prices noted below were obtained from the OTC market and reflect inter-dealer
prices, without retail mark-up, mark-down or commission and may not represent
actual transactions.
For
the periods indicated, the following table sets forth the high and low bid
prices per share of common stock based on inter-dealer prices, without retail
mark-up, mark-down or commission and may not represent actual transactions.
|
Fiscal
2019
|
|
Fiscal
2018
|
|
High
|
|
Low
|
|
High
|
|
low
|
First
Quarter
|
$ 0.0200
|
|
$ 0.0059
|
|
$ 0.0010
|
|
$ 0.0005
|
Second Quarter
|
$ 0.0059
|
|
$ 0.0036
|
|
$ 0.0100
|
|
$ 0.0005
|
Third
Quarter
|
$ 0.0100
|
|
$ 0.0060
|
|
$ 0.0100
|
|
$ 0.0100
|
Fourth Quarter
|
$ 0.0200
|
|
$ 0.0100
|
|
$ 0.0025
|
|
$ 0.0019
|
|
|
|
|
|
|
|
|
The Company does not have common equity
subject to outstanding options or warrants to purchase or securities
convertible into our common equity. In general, under Rule 144, a holder of
restricted common shares who is an affiliate at the time of the sale or any
time during the three months preceding the sale can resell shares, subject to
the restrictions described below.
If
we have been a public reporting company under the Exchange Act for at least 90
days immediately before the sale, then at least six months must have elapsed
since the shares were acquired from us or one of our affiliates, and we must
remain current in our filings for an additional period of six months; in all
other cases, at least one year must have elapsed since the shares were acquired
from us or one of our affiliates.
The
number of shares sold by such person within any three-month period cannot
exceed the greater of:
-
1% of the total number of our common shares
then outstanding; or
-
The average weekly trading volume of our common
shares during the four calendar weeks preceding the date on which notice
on Form 144 with respect to the sale is filed with the SEC (or, if Form
144 is not required to be filed, the four calendar weeks preceding the
date the selling broker receives the sell order) This condition is not
currently available to the Company because its securities do not trade on
a recognized exchange.
Conditions
relating to the manner of sale, notice requirements (filing of Form 144 with
the SEC) and the availability of public information about us must also be
satisfied.
27,724,684
shares of our common stock have been issued and outstanding as at December 31,
2019 and 2018. Of the amount of the outstanding shares, 18,894,381are
unrestricted and free-trading. The remaining 8,830,306 of the issued shares
are restricted and could only be sold subject to the restriction.
8,830,306
of the presently outstanding shares of our common stock are "restricted
securities" as defined under Rule 144 promulgated under the Securities Act
and may only be sold pursuant to an effective registration statement or an
exemption from registration, if available. The SEC has adopted final rules
amending Rule 144, which have become effective on February 15, 2008. Pursuant
to the new Rule 144, one year must elapse from the time a “shell company,”
as defined in Rule 405 of the Securities Act and Rule 12b-2 of the Exchange
Act, ceases to be a “shell company” and files a Form 8-K addressing Item 5.06 with such information as may be
required in a Form 10 Registration Statement with the SEC, before a restricted
shareholder can resell their holdings in reliance on Rule 144. Form 10
information is equivalent to information that a company would be required to
file if it were registering a class of securities on Form 10 under the Exchange
Act. Under the amended Rule 144, restricted or unrestricted securities, that
were initially issued by a reporting or non-reporting shell company
or a company that was at anytime previously a reporting or
non-reporting shell company, can only be resold in reliance on Rule
144 if the following conditions are met:
-
the issuer of the securities that was formerly
a reporting or non-reporting shell company has ceased to be a shell
company;
-
the issuer of the securities is subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act;
-
the issuer of the securities has filed all
reports and material required to be filed under Section 13 or 15(d) of the
Exchange Act, as applicable, during the preceding twelve months (or
shorter period that the Issuer was required to file such reports and
materials), other than Form 8-K reports; and
-
at least one year has elapsed from the time the
issuer filed the current Form 10 type information with the SEC reflecting
its status as an entity that is not a shell company.
Current
Public Information
In
general, for sales by affiliates and non-affiliates, the satisfaction of the
current public information requirement depends on whether we are a public
reporting company under the Exchange Act:
-
If we have been a public reporting company for
at least 90 days immediately before the sale, then the current public
information requirement is satisfied if we have filed all periodic reports
(other than Form 8-K) required to be filed under the Exchange Act during
the 12 months immediately before the sale (or such shorter period as we
have been required to file those reports).
-
If we have not been a public reporting company
for at least 90 days immediately before the sale, then the requirement is
satisfied if specified types of basic information about us (including our
business, management and our financial condition and results of
operations) are publicly available.
However,
no assurance can be given as to:
-
the likelihood of a market for our common
shares developing,
-
the liquidity of any such market,
-
the ability of the shareholders to sell the
shares, or
-
the prices that shareholders may obtain for any
of the shares.
No
prediction can be made as to the effect, if any, that future sales of shares or
the availability of shares for future sale will have on the market price
prevailing from time to time. Sales of substantial amounts of our common
shares, or the perception that such sales could occur, may adversely affect
prevailing market prices of the common shares.
Dividends
Holders
of common stock are entitled to receive ratably such dividends, if any, as may
be declared by the board of directors out of our surplus. We have not paid any
dividends since our inception, and we presently anticipate that all earnings,
if any, will be retained for development of our business. Any future
disposition of dividends will be at the discretion of our board of directors
and will depend upon, among other things, our future earnings, operating and
financial condition, capital requirements and other factors.
Preferred
Stock
We
are authorized to issue 1,000,000 shares of preferred stock and we have 1
preferred stock issued as of December 31, 2019
Securities
Authorized for Issuance under Equity Compensation Plans
We
do not have any compensation plans or arrangements under which equity
securities are authorized for issuance.
|
ITEM 6.
|
SELECTED FINANCIAL DATA
|
Not
applicable
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
|
Our
Management’s Discussion and Analysis of Financial Condition and Results of
Operations section discusses our financial statements, which have been prepared
in accordance with accounting principles generally accepted in the United
States of America. The preparation of these financial statements requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. On an on-going
basis, management evaluates its estimates and judgments, including those
related to revenue recognition, accrued expenses, financing operations, and
contingencies and litigation. Management bases its estimates and judgments on
historical experience and on various other factors that are believed to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying value of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these
estimates under different assumptions or conditions. The most significant
accounting estimates inherent in the preparation of our financial statements
include estimates as to the appropriate carrying value of certain assets and
liabilities which are not readily apparent from other sources.
You
should read the following description of our financial condition and results of
operations in conjunction with the financial statements and accompanying notes
included in this annual report beginning on page F-1.
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. These forward-looking statements
are subject to certain risks and uncertainties that could cause actual results
to differ materially from our predictions.
GiveMePower
Corporation (the “PubCo” or “Company”), a Nevada corporation, was incorporated
on June 7, 2001 to sell software geared to end users and developers involved in
the design, manufacture, and construction of engineered products located in
Canada and the United States. The PubCo has been dormant and non-operating
since year 2009. PubCo is a public reporting company registered with the
Securities Exchange Commissioner (“SEC”). In November 2009, the Company filed
Form 15D, Suspension of Duty to Report, and as a result, the Company was not
required to file any SEC forms since November 2009.
On
December 31, 2019, PubCo sold one Special 2019 series A preferred share
(“Series A Share”) for $38,000 to Goldstein Franklin, Inc. (“Goldstein”), a
California corporation. One Series A Share is convertible to 100,000,000 shares
of common stocks at any time. The Series A Share also provided with 60% voting
rights of the PubCo. On the same day, Goldstein sold one-member unit of
Alpharidge Capital, LLC (“Alpharidge”), a California limited liability
corporation, representing 100% member owner of Alpharidge. As a result,
Alpharidge become a wholly owned subsidiary of PubCo as of December 31, 2019.
The
transaction above will be accounted for as a “reverse merger” and
recapitalization amongst PubCo, Goldstein, and Alpharidge since the stockholders
of Alpharidge will have the significant influence and the ability to elect or
appoint or to remove a majority of the members of the governing body of the
combined entity immediately following the completion of the transaction, the
stockholders of PubCo will have the significant influence and the ability to
elect or appoint or to remove a majority of the members of the governing body
of the combined entity, and PubCo’s senior management
will dominate the management of the combined entity immediately following the
completion of the transaction. Accordingly, Alpharidge will be deemed to be the
accounting acquirer in the transaction and, consequently, the transaction is
treated as a recapitalization of the PubCo. Accordingly, the assets and
liabilities and the historical operations that are reflected in the financial
statements are those of Alpharidge and are recorded at the historical cost
basis of Alpharidge. As a result, Alpharidge is the surviving company and the
financial statements presented are historical financial accounts of Alpharidge.
Going forward, our plan is to reach the point where we are
generating sufficient revenue from our operations to meet our obligations on a
timely basis, while
we are waiting to raise adequate capital to fully finance our business plan.
To that end, we intend to continue operating our proprietary trading account,
focusing on event-driven opportunities. Through our structure, we plan to offer
investors an opportunity to participate in the ownership and growth of a portfolio
of businesses that traditionally have been owned and managed by private equity
firms, private individuals or families, financial institutions or large
conglomerates. We believe that our management, proprietary trading and
acquisition strategies will allow us to achieve our goals of creating
sustainable earnings growth for our shareholders and increasing shareholder
value over time through investments in assets, projects and businesses build
healthy communities where every-day Americans live and work.
Results of Operations
For the year ended December 31, 2019 compared with
the year ended December 31, 2018
Revenue
We
are generating substantially all our revenue from our proprietary trading
operation. For the year ended December 31, 2019, the company has revenue of
$464. Compared to December 31, 2018 revenue of $0.00
Cost
of Revenues
Our
cost of revenue is totally related to the cost of acquiring the trading
securities. Cost of related to our securities for the year December 31, 2019
was $0.00. Compared to December 31, 2018 revenue of $0.00
General
and Administrative Expenses
General
and administrative expense for the year was $85. General and administrative
expense consists of costs related to the establishment of corporate governances;
and costs associated with our plans and preparations for a future potential
capital raise. These expenses also include the costs of conducting market
research, attending and/or participating in industry conferences and seminars,
business development activities, and other general business outside consulting
activities. General and administrative expense also includes travel costs, for
third-party consultants, legal and accounting fees and other professional and
administrative costs.
We
expect that general and administrative expense will increase in the future as
we add to our personnel and expand our infrastructure to support the
requirements of being a public company.
Net Income
Net
Income for the year was $379.
Related
Party Transactions
The
following individuals and entities have been identified as related parties
based on their affiliation with our CEO and director, Frank I Igwealor:
Frank I Igwealor
Goldstein
Franklin, Inc.
The
following amounts were owed to related parties, affiliated with the CEO and
Chairman of the Board, at the dates indicated:
|
|
31-Dec-19
|
|
Frank I Igwealor
|
|
$
|
-
|
|
|
|
|
|
|
Goldstein Franklin Inc
|
|
$
|
41,200
|
|
Liquidity and Capital Resources
As
of December 31, 2019, we had $500 cash on hand. We anticipate
that our cash position is not sufficient to fund current
operations. We have limited lending relationships with
commercial banks and are dependent upon the completion of one or more financings
or equity raises to fund our continuing operations. We
anticipate that we will seek additional capital through debt or equity
financings. While we are aggressively pursuing financing,
there can be no assurance that we will be successful in our capital raising
efforts. Any additional equity financing may result in
substantial dilution to our stockholders.
Since
2019, all of our operations have been financed through advances from a company
controlled by our president and CEO. As of December 31, 2019, the company
controlled by our president and CEO has loaned $41,200 to us, with no
formal commitments or arrangements to advance or loan any
additional funds to us in the future. We have not yet achieved
significant profitability. We expect that our general and administrative
expenses will continue to increase and, as a result, we will need to generate
significant revenues to achieve significant profitability. We may never achieve
significant profitability.
The
revenues, if any, generated from our operations or acquisitions may not be
sufficient to fund our operations or planned growth. We will require additional
capital to continue to operate our business, and to further expand our
business. Sources of additional capital through various financing transactions
or arrangements with third parties may include equity or debt financing, bank
loans or revolving credit facilities. We may not be successful in locating
suitable financing transactions in the time period required or at all, and we
may not obtain the capital we require by other means.
We
will now be obligated to file annual, quarterly and current reports with the
SEC pursuant to the Exchange Act. In addition, the Sarbanes-Oxley Act of 2002
(“Sarbanes-Oxley”) and the rules subsequently implemented by the SEC and the
Public Company Accounting Oversight Board have imposed various requirements on
public companies, including requiring changes in corporate governance
practices. We expect these rules and regulations to increase our legal and
financial compliance costs and to make some activities of ours more time-
consuming and costly. In order to meet the needs to comply with the
requirements of the Securities Exchange Act, we will need investment of
capital.
Management
has determined that additional capital will be required in the form of equity
or debt securities. There is no assurance that management will be able to raise
capital on terms acceptable to the Company. If we are unable to obtain
sufficient amounts of additional capital, we may have to cease filing the
required reports and cease operations completely. If we obtain additional funds
by selling any of our equity securities or by issuing common stock to pay
current or future obligations, the percentage ownership of our shareholders
will be reduced, shareholders may experience additional dilution, or the equity
securities may have rights preferences or privileges senior to the common
stock.
Off-Balance Sheet Arrangements
There
are no off-balance sheet arrangements that have or are reasonably likely to
have a current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that are material to investors.
Recent Accounting Pronouncements
From time-to-time, new accounting
pronouncements are issued by the Financial Accounting Standards Board or other
standard setting bodies, relating to the treatment and recording of certain
accounting transactions. Unless otherwise discussed herein, management of the
Company has determined that these recent accounting pronouncements will not
have a material impact on the financial position or results of operations of
the Company.
Critical Accounting Policies
Critical Accounting Policies and Significant
Judgments and Estimates
Our
management’s discussion and analysis of our financial condition and results of
operations is based on our financial statements which we have been prepared in
accordance with U.S. generally accepted accounting principles. In preparing our
financial statements, we are required to make estimates and assumptions that
affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting periods.
Critical
accounting estimates are estimates for which (a) the nature of the estimate is
material due to the levels of subjectivity and judgment necessary to account
for highly uncertain matters or the susceptibility of such matters to change
and (b) the impact of the estimate on financial condition or operating
performance is material.
These
significant accounting estimates or assumptions bear the risk of change due to
the fact that there are uncertainties attached to these estimates or
assumptions, and certain estimates or assumptions are difficult to measure or
value.
Management
bases its estimates on historical experience and on various assumptions that
are believed to be reasonable in relation to the financial statements taken as
a whole under the circumstances, the results of which form the basis for making
judgments about the carrying values of assets and liabilities that are not
readily apparent from other sources.
Management
regularly evaluates the key factors and assumptions used to develop the
estimates utilizing currently available information, changes in facts and
circumstances, historical experience and reasonable assumptions. After such
evaluations, if deemed appropriate, those estimates are adjusted accordingly.
Actual results could differ from those estimates.
While
our significant accounting policies are described in more detail in Note 2 of
our annual financial statements included in this Annual Report, we believe the
following accounting policies to be critical to the judgments and estimates
used in the preparation of our financial statements:
Fair Value of Financial Instruments
The Company utilizes ASC
820-10, Fair Value Measurement and Disclosure, for valuing financial assets and
liabilities measured on a recurring basis. Fair value is defined as the exit
price, or the amount that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants as
of the measurement date. The guidance also establishes a hierarchy for inputs
used in measuring fair value that maximizes the use of observable inputs and
minimizes the use of unobservable inputs by requiring that the most observable
inputs be used when available. Observable inputs are inputs market participants
would use in valuing the asset or liability and are developed based on market
data obtained from sources independent of the Company. Unobservable inputs are
inputs that reflect the Company’s assumptions about the factors market
participants would use in valuing the asset or liability. The guidance
establishes three levels of inputs that may be used to measure fair value:
Level 1. Observable inputs
such as quoted prices in active markets;
Level
2. Inputs, other than the quoted prices in active markets, that are observable
either directly or indirectly; and
Level 3. Unobservable inputs
in which there is little or no market data, which require the reporting entity
to develop its own assumptions.
Financial
assets are considered Level 3 when their fair values are determined using
pricing models, discounted cash flow methodologies or similar techniques and at
least one significant model assumption or input is unobservable.
The
fair value hierarchy gives the highest priority to quoted prices (unadjusted)
in active markets for identical assets or liabilities and the lowest priority
to unobservable inputs. If the inputs used to measure the financial assets and
liabilities fall within more than one level described above, the categorization
is based on the lowest level input that is significant to the fair value
measurement of the instrument.
Transactions
involving related parties cannot be presumed to be carried out on an
arm’s-length basis, as the requisite conditions of competitive, free-market
dealings may not exist. Representations about transactions with related
parties, if made, shall not imply that the related party transactions were
consummated on terms equivalent to those that prevail in arm’s-length
transactions unless such representations can be substantiated.
Stock-Based Compensation
We
measure the cost of services received in exchange for an award of equity
instruments based on the fair value of the award. For employees and directors,
the fair value of the award is measured on the grant date and for
non-employees, the fair value of the award is generally re-measured on vesting
dates and interim financial reporting dates until the service period is
complete. The fair value amount is then recognized over the period during which
services are required to be provided in exchange for the award, usually the
vesting period. Stock-based compensation expense is recorded by us in the same
expense classifications in the consolidated statements of operations, as if
such amounts were paid in cash.
Deferred Tax Assets and Income Taxes Provision
The
Company adopted the provisions of paragraph 740-10-25-13 of the FASB Accounting
Standards Codification. Paragraph 740-10-25-13 which addresses the determination
of whether tax benefits claimed or expected to be claimed on a tax return
should be recorded in the financial statements. Under paragraph 740-10-25-13,
the Company may recognize the tax benefit from an uncertain tax position only
if it is more likely than not that the tax position will be sustained on
examination by the taxing authorities, based on the technical merits of the
position. The tax benefits recognized in the financial statements from such a
position should be measured based on the largest benefit that has a greater
than fifty percent (50%) likelihood of being realized upon ultimate settlement.
Paragraph 740-10-25-13 also provides guidance on de-recognition,
classification, interest and penalties on income taxes, accounting in interim
periods and requires increased disclosures. The Company had no material
adjustments to its liabilities for unrecognized income tax benefits according
to the provisions of paragraph 740-10-25-13.
The
estimated future tax effects of temporary differences between the tax basis of
assets and liabilities are reported in the accompanying balance sheets, as well
as tax credit carry-backs and carry-forwards. The Company periodically reviews
the recoverability of deferred tax assets recorded on its balance sheets and provides
valuation allowances as management deems necessary.
Management
makes judgments as to the interpretation of the tax laws that might be
challenged upon an audit and cause changes to previous estimates of tax
liability. In addition, the Company operates within multiple taxing
jurisdictions and is subject to audit in these jurisdictions. In management’s
opinion, adequate provisions for income taxes have been made for all years. If
actual taxable income by tax jurisdiction varies from estimates, additional
allowances or reversals of reserves may be necessary.
Management
assumes that the realization of the Company’s net deferred tax assets resulting
from its net operating loss (“NOL”) carry–forwards for Federal income tax
purposes that may be offset against future taxable income was not considered
more likely than not and accordingly, the potential tax benefits of the net
loss carry-forwards are offset by a full valuation allowance. Management made
this assumption based on (a) the Company has incurred recurring losses and
presently has no revenue-producing business; (b) general economic conditions;
and, (c) its ability to raise additional funds to support its daily operations
by way of a public or private offering, among other factors.
Seasonality
Although our
operating history is limited, we do not consider our business to be seasonal.
Commercial Real
Property
As
at December 31, 2019, the Company has no commercial real estate.
Line of Credit
As
at December 31, 2019, we have on our book $41,200 classified as long-term
debt. This debt is from an interest-free line of credit from a related party.
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK
|
Not
applicable
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
The
audited financial statements for this annual report follow the signature page
beginning on page F-1.
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
|
None
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
Conclusion
Regarding the Effectiveness of Disclosure Controls and Procedures
Under
the supervision and with the participation of our management, including our
principal executive officer, we conducted an evaluation of our disclosure
controls and procedures, as such term is defined in Rule 13a-15(e) under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end
of the period covered by this annual report. Based on this evaluation, our
principal executive officer and our principal financial officer concluded that
our disclosure controls and procedures were not effective to provide reasonable
assurance that information required to be disclosed by us in reports we file or
submit under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the SEC’s rules and forms, and is
accumulated and communicated to our management, including our principal
executive officer and principal financial officer, as appropriate to allow
timely decisions regarding required disclosures.
This
annual report does not include a report of management’s assessment regarding
internal control over financial reporting or an attestation report of the
company’s registered public accounting firm due to a transition period established
by rules of the SEC for newly public companies.
Changes
in Internal Control Over Financial Reporting
There
were no changes in our internal control over financial reporting during the
fourth quarter of fiscal 2016 that have materially affected, or are reasonably
likely to materially affect, our internal control over financial reporting.
|
ITEM 9B.
|
OTHER INFORMATION
|
None
PART III
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE
|
Officers
and Board of Directors
Our
Bylaws provide that the number of directors who shall constitute the whole board
shall be such number as the Board of Directors shall at the time have designated.
We confirm that the number of authorized directors has been set at five
pursuant to our bylaws. Each director shall be selected for a term of one year
and until his successor is elected and qualified. Vacancies are filled by a majority
vote of the remaining directors then in office with the successor elected for
the unexpired term and until the successor is elected and qualified.
The
names and ages of our directors and officers, and their positions, are as
follows:
Name
|
|
Age*
|
|
Position within the Company
|
|
Term
|
Mr. Frank I Igwealor
|
|
48
|
|
Chairman, Director and Chief Executive and Financial Officer
|
|
December 2019 to present
|
Mr. Patience Ogbozor
|
|
34
|
|
Director
|
|
December 2019 to present
|
|
|
|
|
|
|
|
*Age as at December 31, 2019.
Term
of Office
Each of our directors is appointed to hold
office until the next annual meeting of our shareholders or until his
respective successor is elected and qualified, or until she resigns or is
removed in accordance with the provisions of the Delaware
Statues. Our officers are appointed by our board of directors and
hold office until removed by the board of directors or until their resignation.
Background
and Business Experience
The business experience during the past
five years of the persons listed above as an Officer or Director of the Company
either presently or during the year ended December 31, 2019 is as follows:
Frank Igwealor, CPA, CMA, JD, MBA, MSRM is a financial
manager with broad
technical and management experience in accounting, finance, and business
advisory.
Mr. Igwealor is a Certified Financial Manager, Certified Management
Accountant, and Certified Public Accountant.
Frank
has an extensive freelance consulting experience for the cannabis industry. As
a CPA, CMA, CFM consultant, Frank have provided top-level financial reporting,
Accounting, SEC Reporting, Business Valuation, Mergers & Acquisitions,
GAAP/ IFRS Conversion, Pre IPO/RTO Prep, 280E Tax, and Biological Assets
Valuation to more than 26 cannabis businesses across 21 states. Frank have
substantial experience with Section 280E of the Internal Revenue Code, having worked for/with investors in the cannabis industry and
helped them analyze the COGS and Operating expenses of dispensaries. Frank has
been part of a team that shepherded both big and small cannabis investments
through the required audit and conducted all the filings to take them public
through IPO, DPO or RTO transactions. I have worked with single dispensaries
with cultivation as well as ROLL-UP of multiple dispensaries that wanted to
achieve revenue scale at debut on the exchanges. Frank has been an important
part of the team that successfully delivered on the following:
·
Helped Cannabis business owners
and investors with top-level financial reporting for SEC and Canadian
Securities Exchanges (CSE), and investor consumption.
·
Consolidated dispensaries and
cultivations and shepherd the consolidated holding company through GAAP and
IFRS audit and get them listed on the US and Canadian exchanges.
·
Prepared complete audit packages,
which includes workpapers and all necessary documentation. Frank does not do
audits or any attest work. This is as a result of Sarbanes-Oxley legislation
which prohibits auditors from preparing financial statements or conducting any
accounting work for their clients.
·
Help dispensaries and cultivation
owners to set up standardized (best practice) accounting and financial
reporting systems.
·
Frank continues to have ongoing
consulting project for legal-cannabis businesses such as managing the filing of
Form 10-K , 10-Q and the associated audit, or just assisting on a technical
accounting question such as providing a journal entry for a specific
transaction.
Ms. Patience C. Ogbozor, Director:
Ms.
Ogbozor is the President and CEO of Cannabinoid Biosciences since November
2018. Ms. Ogbozor is a Director of the Company. Ms. Ogbozor is also a
director at Goldstein Franklin Inc.
All directors hold office until the next
annual meeting of stockholders and the election and qualification of their
successors. Officers are elected annually by the board of
directors and serve at the discretion of the board.
Board
Committees
Our
board of directors expects to create an audit committee, compensation
committee, and nominations and governance committee during fiscal 2022, in
compliance with established corporate governance
requirements. Currently, we have no “independent” directors,
as that term is defined under Nasdaq listing rules.
Audit
Committee. We
plan to establish an audit committee of the board of directors. The
audit committee would be primarily responsible for reviewing the services
performed by our independent registered public accounting firm and evaluating
our accounting policies and our system of internal controls.
Compensation
Committee. We
plan to establish a compensation committee of the board of
directors. The compensation committee would review and approve
our salary and benefits policies, including compensation of executive
officers. The compensation committee would also administer any
future incentive compensation plans, and recommend and approve grants of stock
options, restricted stock and other awards under any such plan.
Nominations
and Governance Committee. We plan to establish a
nominations and governance committee of the board of
directors. The purpose of the nominations and governance
committee would be to select, or recommend for our entire board’s selection,
the individuals to stand for election as directors at the annual meeting of
stockholders and to oversee the selection and composition of committees of our
board. The nominations and governance committee’s duties would
also include considering the adequacy of our corporate governance and
overseeing and approving management continuity planning processes.
To
date, our full board, rather than any of the committees, has performed all of
these functions.
Indebtedness
of Directors and Executive Officers
None
of our directors or officers or their respective associates or affiliates is
indebted to us.
Family
Relationships
Except for Patience and Frank who have spousal
relationship, none of our directors are related to any of our other directors
and none have any pending legal claims or litigation against them.
Legal
Proceedings
From
time to time we may be involved in litigation relating to claims arising out of
the operation of our business in the normal course of business. Other than as
described below, as of the date of this filing we are not aware of potential
dispute or pending litigation and are not currently involved in a litigation
proceeding or governmental actions the outcome of which in management’s opinion
would be material to our financial condition or results of operations. An
adverse result in these or other matters may have, individually or in the aggregate,
a material adverse effect on our business, financial condition or operating
results.
On February 20, 2019, Plaintiff maria De Lourdes Perez filed a
complaint against defendants City of Carson, Goldstein Franklin, Inc., Frank
Igwealor, Healthy Foods Markets, LLC, Optimal Foods, LLC, and Blockchain
Capital LLC. The complaint alleged statutory liability pursuant to government
code section 835, gross negligence, and premises liability for a trip-and-fall
that occurred on April 11, 2018 at a property owned and controlled by Healthy
Foods Markets, LLC. Defendants Goldstein Franklin, Inc., Frank Igwealor,
Optimal Foods, LLC, and Blockchain Capital LLC. had answered the complaint and
also requested a demurrer on the grounds that (1) Defendants are not a proper
party in interest and there was a misjoinder of defendants. Our attorney has
advised that the complaint would not have an adverse impact on Mr. Igwealor or
the Company because the scope of liability is restricted to healthy Food
Markets, LLC.
As of December 31, 2019, except for the complaint listed above,
there was no material proceeding to which any of our directors, officers,
affiliates or stockholders is a party adverse to us. During the past ten
years, no present director, executive officer or person nominated to become a
director or an executive officer of us:
(1) had a petition under the
federal bankruptcy laws or any state insolvency law filed by or against, or a
receiver, fiscal agent or similar officer appointed by a court for the business
or property of such person, or any partnership in which he was a general
partner at or within two years before the time of such filing, or any
corporation or business association of which he was an executive officer at or
within ten years before the time of such filing;
(2) was convicted in a criminal
proceeding or subject to a pending criminal proceeding (excluding traffic
violations and other minor offenses);
(3) was subject to any order,
judgment or decree, not subsequently reversed, suspended or vacated, of any
court of competent jurisdiction, permanently or temporarily enjoining him from
or otherwise limiting his involvement in any of the following activities:
i. acting as a futures commission
merchant, introducing broker, commodity trading advisor commodity pool
operator, floor broker, leverage transaction merchant, any other person
regulated by the Commodity Futures Trading Commission, or an associated person
of any of the foregoing, or as an investment adviser, underwriter, broker or
dealer in securities, or as an affiliated person, director or employee of any
investment company, bank, savings and loan association or insurance company, or
engaging in or continuing any conduct or practice in connection with such
activity;
ii. engaging in any type of
business practice; or
iii. engaging in any activity in
connection with the purchase or sale of any security or commodity or in
connection with any violation of federal or state securities laws or federal
commodities laws; or
(4) was the subject of any order,
judgment or decree, not subsequently reversed, suspended or vacated, of an
federal or state authority barring, suspending or otherwise limiting for more
than 60 days the right of such person to engage in any activity described in
paragraph (3) (i), above, or to be associated with persons engaged in any such
activity; or
(5) was
found by a court of competent jurisdiction (in a civil action), the Securities
and Exchange Commission or the Commodity Futures Trading Commission to have
violated a federal or state securities or commodities law, and for which the
judgment has not been reversed, suspended or vacated.
Employment
Agreements
We
do not currently have an employment agreement with Frank I Igwealor, our
President, Chief Executive Officer and Chief Financial Officer, or with any of
our other officers or directors, and do not intend to do so until such time as
we deem it prudent. Our officers do not currently receive a (money)
salary for their services, and we do not yet recognize compensation expense in
our financial statements.
Section
16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our executive officers
and directors and persons who own more than 10% of a registered class of our
equity securities to file with the SEC initial statements of beneficial
ownership, reports of changes in ownership and annual reports concerning their
ownership of our Common Stock and other equity securities, on Form 3, 4 and 5
respectively. Executive officers, directors and greater than 10% shareholders
are required by the SEC regulations to furnish our company with copies of all
Section 16(a) reports they file. Mr. Igwealor has filed all required reports
under Section 16(a) of the Exchange Act.
Code
of Ethics
We have adopted a corporate code of ethics. We
believe our code of ethics is reasonably designed to deter wrongdoing and
promote honest and ethical conduct; provide full, fair, accurate, timely and
understandable disclosure in public reports; comply with applicable laws;
ensure prompt internal reporting of code violations; and provide accountability
for adherence to the code. We adopted a Code of Ethics and Business Conduct
which is applicable to our future employees and which also includes a Code of
Ethics for our chief executive and principal financial officers and any persons
performing similar functions. A code of ethics is a written standard designed
to deter wrongdoing and to promote:
·
|
honest
and ethical conduct,
|
·
|
full,
fair, accurate, timely and understandable disclosure in regulatory filings
and public statements,
|
·
|
compliance
with applicable laws, rules and regulations,
|
·
|
the
prompt reporting violation of the code, and
|
·
|
accountability
for adherence to the code.
|
Our
adopted a code of ethics applies to all our directors, officers and
employees. Our code of ethics is intended to comply with the
requirements of Item 406 of Regulation S-K.
We
will provide our code of ethics in print without charge to any stockholder who
makes a written request to Frank I Igwealor, our President, Chief Executive
Officer and Chief Financial Officer, at GiveMePower Corporation, 370 Amapola
Ave., Suite 200A, Torrance, CA 90501. Any waivers of the application,
and any amendments to, our code of ethics must be made by our board of
directors. Any waivers of, and any amendments to, our code of
ethics will be disclosed promptly on our Internet website.
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
Compensation
Discussion and Analysis
Compensation
Committee Interlocks and Insider Participation
As the
Board of Directors does not have a Compensation Committee, the independent
directors of the Board oversee the Company’s executive compensation program. We
currently do not have independent directors on our Board. Compensation for the CEO and the CFO is approved by the Independent
Directors of the Board or the general Board. Compensation for other executive
officers and senior management is determined by the CEO and CFO pursuant to the
Board of Directors delegating to the CEO and CFO authority to do so.
Elements to Executive Compensation
The
Company’s executive compensation program is designed to attract and retain
executives responsible for the Company’s long-term success, to reward
executives for achieving both financial and strategic company goals and to
provide a compensation package that recognizes individual contributions as well
as overall business results. The Company’s executive compensation program also
takes into account the compensation practices of companies with whom Kid Castle
competes for executive talent.
The two
components of the Company’s executive compensation program are base salary and
annual discretionary bonuses. Overall compensation is intended to be
competitive for comparable positions at peer companies.
Objectives. The objectives of the Company’s executive compensation
policies are to attract and retain highly qualified executives by designing the
total compensation package to motivate executives to provide excellent
leadership and achieve Company goals; to align the interests of executives,
employees, and stockholders by establishing cohesive management, financial,
operation and marketing goals that reflect the Company’s strategic growth plan;
and to provide executives with reasonable security, through retirement plan and
annual discretionary bonuses that motivate them to continue employment with the
Company and achieve goals that will make the Company thrive and remain
competitive in the long-run.
Linkage
between compensation programs and Company objective and values. We link executive compensation closely with the Company
objectives, which we believe are dependent on the level of employee engagement,
operational excellence, cost management and profitability achieved. Currently,
the primary quantifiable measurement of operational excellence for the Company
is the achievement of profitability, which is directly related to increasing
annual revenue. Executives’ annual performance evaluations are based in part on
their achievement of the aforementioned goals and in part on revenue targets
that may be established by the Board of Directors at the beginning of each
fiscal year. The Board of Directors has not set a specific revenue goal for the
award of bonuses for fiscal 2018. The Company currently does not have a defined
non-equity incentive plan in place for its named executives. Instead, the
disinterested members of the Board of Directors determine if any annual
discretionary bonuses should be awarded to named executives in conjunction with
the named executives’ annual performance evaluations. As indicated in the table
below, during the last three fiscal years, the Board of Directors has not
elected to award any annual discretionary bonuses to any named executives.
The roles
of various elements of compensation. Executive
compensation includes base salary, annual discretionary bonuses awarded by the
Board of Directors in conjunction with named executives’ annual performance
evaluations and other annual compensation granted under the noncontributory
defined benefit retirement plan. Collectively, the Board’s objective is to
ensure a total pay package that is appropriate given the performance of both
the Company and the individual named executive.
Governance
practices concerning compensation. The Board
of Directors has implemented a number of procedures that the Board follows to
ensure good governance concerning compensation. These include setting CEO and
CFO salaries, authorizing the CEO or the CFO to determine the salaries of
presidents and vice presidents, including Mrs. Huang, President of Shanghai
operations, establishing annual goals for the Company, reviewing proposals for
stock incentive plans, exercising fiduciary responsibilities over retirement
plans, overseeing management development and succession planning, and keeping
adequate records of its activities.
Base Salary
Each
executive’s base salary is initially determined with reference to competitive
pay practices of peer companies (where such information is publicly available)
and is dependent upon the executive’s level of responsibility and experience.
The Board uses its discretion, rather than a formal weighting system, to
evaluate these factors and to determine individual base salary levels.
Thereafter, base salaries are reviewed periodically, and increases are made
based on the Board of Director’s subjective assessment of individual
performance, as well as the factors discussed above.
Annual Discretionary Bonuses
In future years
we shall pay variable incentive compensation to our executives, however, due to
our overall performance in 2019 and 2018, our executive officers were not
awarded bonuses.
Summary
Compensation Table
The following table sets forth information about
the compensation paid or accrued by our chief executive officer, chief financial
officer, and one other most highly compensated executive officer (our “named
officers”) for the last three completed fiscal years
Summary Compensation Table
|
|
|
|
|
|
Non-Equity
|
Nonqualified
|
|
|
Name
|
|
|
|
|
|
Incentive
|
Deferred
|
|
|
and
|
|
|
|
Stock
|
Option
|
Plan
|
Compensation
|
All Other
|
|
principal
|
|
Salary
|
Bonus
|
Awards
|
Awards
|
Compensation
|
Earnings
|
Compensation
|
Total
|
position
|
Year
|
($)
|
($)
|
($)
|
($)
|
($)
|
($)
|
($)
|
($)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
|
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
1. Frank Igwealor CEO, CFO and Director
|
2019
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|
2018
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
2. Patience Ogbozor, Director
|
2019
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|
2018
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes:
Stock
Option Grants in the Last Fiscal Year; Exercises of Stock Options
There were no grants of stock options during the
fiscal year ended December 31, 2019. The Company has never granted any stock
options.
Outstanding
Equity Awards at Fiscal Year-End
As
of December 31, 2019, there were no equity awards outstanding to any of our
current or previous executive officers.
Director
Compensation
Our
directors do not currently receive any compensation for serving on our board of
directors.
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
The
following table sets forth certain information regarding the number of shares
of our common stock beneficially owned on December 31, 2019, by (i) each person
known to us who owns beneficially more than 5% of the outstanding shares of
Common Stock (based upon reports which have been filed and other information
known to us), (ii) each of our Directors, (iii) each of our Executive Officers
and (iv) all of our Executive Officers and Directors as a group. Unless
otherwise indicated, each stockholder has voting and investment power with
respect to the shares shown. As of December 31, 2019, we had 27,724,684shares
of Common Stock issued and outstanding.
Beneficial
ownership is determined in accordance with the rules of the SEC and generally
includes voting or investment power with respect to
securities. Shares of our common stock which may be acquired
upon exercise of stock options or warrants which are currently exercisable or
which become exercisable within 60 days after the date indicated in the table
are deemed beneficially owned by the optionees. Subject to any
applicable community property laws, the persons or entities named in the table
above have sole voting and investment power with respect to all shares
indicated as beneficially owned by them.
Unless
otherwise indicated, the address of each of the executive officers and
directors and 5% or more stockholders named below is c/o GiveMePower
Corporation, Inc., 370 Amapola Ave., Suite 200A, Torrance, CA 90501. There
are not any pending or anticipated arrangements that may cause a change in
control.
Name and Address of
Beneficial Owner
|
Amount and Nature of
Beneficial Owner
|
Percent of Class
|
|
Preferred Stock
|
Common Stock
|
|
Frank I Igwealor 1
|
|
|
|
Goldstein Franklin, Inc. (Frank Igwealor)2
|
1
|
|
60.00%
|
Patience C Ogbozor1
|
|
|
|
All other shareholders
|
|
27,724,684
|
40.00%
|
|
|
|
|
|
|
|
|
1) Officer or/and
Director
2) Frank
Igwealor is the natural person with voting and dispositive power over the
shares held by Goldstein
Franklin, Inc.
Frank Igwealor, our President and
CEO, will continue to be the largest single shareholder of our common stock.
When combined with his controlling ownership of Goldstein Franklin, Inc.
We
are unaware of any contract or other arrangement the operation of which may at
a subsequent date result in a change in control of our company.
We
do not have a compensation plan under which equity securities are authorized
for issuance.
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND
DIRECTOR INDEPENDENCE
|
Our
officers and directors are Mr. Igwealor, our chief executive officer and
secretary, and Ms patience C Ogbozor, a Director.
Our
office and mailing address is located at 370 Amapola Ave., Suite 200A, Torrance,
CA 90501.
We do not have a written lease with the landlord and rent space on a
month-to-month basis. We share this office on a 20% basis with two other
organizations controlled by our President and CEO. We believe that our
facilities are adequate for our needs and that additional suitable space will
be available on acceptable terms as required.
During
the year ended December 31, 2019, the Company did not make any share award to the entities and persons in transactions
that would be classified as related parties’ transactions.
There
have been no other related party transactions, or any other transactions or
relationships required to be disclosed pursuant to Item 404 of Regulation S-K.
With
regard to any future related party transaction, we plan to fully disclose any
and all related party transactions, including, but not limited to, the
following:
-
disclose such transactions in prospectuses
where required;
-
disclose in any and all filings with the
Securities and Exchange Commission, where required;
-
obtain disinterested directors’ consent; and
-
obtain shareholder consent where required.
Director
Independence
Our
board of directors has determined that neither of the members of our board of
directors qualifies as an “independent” director under Nasdaq’s definition of
independence.
|
ITEM 14.
|
PRINCIPAL ACCOUNTANT FEES AND SERVICES
|
Audit
Fees
For
fiscal year end December 31, 2019: $10,000
For
fiscal year end December 31, 2018:
NA
We
did not pay any other fees as specified in Item 9(e) of Schedule 14A.
We
do not have audit committee pre-approval policies and procedures.
PART IV
|
ITEM 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
The
following exhibits are filed as part of this Form 10-K and this list includes
the Exhibit Index.
No.
|
|
Description
|
|
|
|
|
|
2.01*
|
|
Securities Purchase Agreement.
|
|
|
|
|
|
3.1**
|
|
Certificate
of Incorporation of GiveMePower Corporation, Inc., filed with the Secretary
of State of the State of Nevada.
|
|
|
|
|
|
3.2*
|
|
By-laws
of GiveMePower Corporation, Inc.
|
|
|
|
|
|
14.1**
|
|
Code
of Business Conduct and Ethics.
|
|
|
|
|
|
|
|
|
|
31.1
|
|
Certification
as Adopted pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
Certification
pursuant to 18 U.S.C. Section 1350, as Adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
|
|
|
|
|
101.INS*
|
|
XBRL
Instance Document
|
|
101.INS*
|
|
XBRL
Taxonomy Extension Schema Document
|
|
101.INS*
|
|
XBRL
Taxonomy Extension Calculation Linkbase Document
|
|
101.INS*
|
|
XBRL
Taxonomy Extension Definition Linkbase Document
|
|
101.INS*
|
|
XBRL
Taxonomy Extension Label Linkbase Document
|
|
101.INS*
|
|
XBRL
Taxonomy Extension Presentation Linkbase Document
|
|
|
*
|
Incorporated
by reference to the exhibits included with Registration Statement on Form 10
filed the U.S. Securities and Exchange Commission on May 11, 2020.
|
|
**
|
Incorporated by reference to Exhibit 3 to Form SB-2 as filed by the
Registrant with the Securities and Exchange Commission on August 10, 2001.
|
SIGNATURES
In
accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
|
GIVEMEPOWER
CORPORATION
|
|
|
|
Date:
June 1, 2020
|
By:
|
/s/ Frank I. Igwealor
|
|
|
Frank
I. Igwealor
|
|
|
President, Chief Executive Officer and Chief Financial
Officer
|
|
|
Principal Executive Officer, Treasurer, Principal
Accounting Officer, Principal Financial Officer, Director & Secretary.
|
Date:
June 1, 2020
|
/s/ Patience C Ogbozor
|
|
Patience
C Ogbozor
|
|
Director
|
In
accordance with the Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Date:
June 1, 2020
|
/s/ Frank I. Igwealor
|
|
Frank
I. Igwealor
|
|
President, CEO and Chief Financial Officer
|
|
Principal Executive Officer, Treasurer, Principal
Accounting Officer, Principal Financial Officer, Director & Secretary.
|
|
|
Date:
June 1, 2020
|
/s/ Patience C Ogbozor
|
|
Patience
C Ogbozor
|
|
Director
|
(b) Financial Statements
The following financial statements are
being filed as part of this Registration Statement:
Index to Consolidated
Financial Statements
|
|
|
|
|
|
|
|
Page
|
Report of Independent Registered
Public Accounting Firm
|
|
F-1
|
|
|
|
For the fiscal years ended December 31, 2019 and 2018
|
|
|
Consolidated Balance Sheets
|
|
F-2
|
Consolidated Statements of
Operations
|
|
F-3
|
Consolidated Statements of
Shareholders’ Deficit
|
|
F-4
|
Consolidated Statements of Cash
Flows
|
|
F-5
|
Notes to Consolidated Financial
Statements
|
|
F-6
|
|
|
|
REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
GIVEMEPOWER CORPORATION
AND
SUBSIDIARY
Consolidated Financial Statements
As of December 31, 2019
For the
period August 30, 2019 (date of formation) to December 31, 2019
Table of Contents
Page
Report of Independent Registered
Public Accounting Firm 1
Consolidated Financial Statements
Consolidated Balance Sheet 2
Consolidated Statement of Operations 3
Consolidated Statement of Stockholders’ Equity 4
Consolidated Statement of Cash Flows 5
Notes to Consolidated Financial Statements 6
200 Sandpointe Avenue, Suite 560
Santa Ana, CA
92707 (949) 326-CPAS (2727)
www.bkcpagroup.com
Report of Independent
Registered Public Accounting Firm
To the Board of Directors and
Stockholders of GiveMePower Corporation and Subsidiary
Opinion on the Consolidated Financial
Statements
We have
audited the accompanying consolidated balance sheet of GiveMePower Corporation
and subsidiary (collectively the “Company”) as of December 31, 2019, and the
related consolidated statements of operations, stockholders’ equity, and cash
flows for the period August 30, 2019 (date of formation) to December 31, 2019.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of the Company as of
December 31, 2019, and the results of its operations and its cash flows for the period
August 30, 2019 (date of formation) to December 31, 2019 in conformity with
accounting principles generally accepted in the United States of America.
Basis for
Opinion
The Company’s
management is responsible for these consolidated financial statements. Our
responsibility is to express an opinion on these consolidated 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 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 consolidated financial
statements are free of material
misstatement, whether due 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 audit, we are required to obtain an understanding of
internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company’s internal control over financial reporting.
Accordingly, we express no such opinion.
Our audit included performing procedures to assess
the risks of material misstatement of the consolidated 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 consolidated 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.
Santa Ana, CA June 1, 2020
The Company have served as the
Company’s auditor since 2020
GiveMePower Corporation
and Subsidiary
Consolidated Balance Sheet
December 31,
|
|
2019
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current Assets:
|
|
|
|
Cash
|
$
|
500
|
|
Investments - trading securities
|
|
45,396
|
Total current assets
|
|
45,896
|
Total assets
|
$
|
45,896
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT
|
|
|
|
|
|
|
Current Liabilities:
|
|
|
|
Marginal loan payable
|
$
|
4,317
|
Total current liabilities
|
|
4,317
|
Line of credit - related party
|
|
41,200
|
Total liabilities
|
|
45,517
|
|
|
|
|
Commitments and Contingencies
|
|
|
|
|
|
|
Stockholders' Equity:
|
|
|
|
Common stock, $0.001; 50,000,000 shares authorized, 27,724,684
shares issued and outstanding
|
|
-
|
|
Preferred stock, $0.001; 1,000,000 shares authorized, 1 share
issued and outstanding
|
|
-
|
|
Accumulated deficit
|
|
379
|
Total stockholders' equity
|
|
379
|
Total liabilities and stockholders' deficit
|
$
|
45,896
|
The accompanying notes are an
integral part of these audited financial statements.
GiveMePower Corporation
and Subsidiary
Consolidated Statement of Operations
August 30, 2019 (date of formation) to December 31, 2019
|
|
Amount
|
Net gain from sales of investments under trading securities
|
$
|
464
|
|
|
|
|
Operating expenses:
|
|
|
|
General and administrative
|
|
-
|
Total operating expenses
|
|
-
|
Total assets
|
|
|
|
|
|
|
|
|
|
|
Other income (expenses):
|
|
|
|
Other expense
|
|
(71)
|
|
Interest expense
|
|
(14)
|
Total other expense, net
|
|
(85)
|
Income before income tax provision
|
|
379
|
Income tax provision
|
|
-
|
Net income
|
$
|
379
|
|
|
|
|
Earnings per share:
|
|
|
|
Basic and diluted
|
$
|
0.00
|
|
|
|
-
|
Weighted average number of common shares outstanding:
|
|
|
|
Basic and Diluted
|
|
27,724,684
|
The accompanying notes are an
integral part of these audited financial statements.
GiveMePower Corporation
and Subsidiary
Consolidated Statement of Stockholders’
Equity
|
Shares
|
Amount
|
|
Shares
|
Amount
|
|
Deficit
|
Equity
|
|
|
|
|
|
|
|
|
|
Balances - August 30, 2019 (date of
formation)
|
-
|
$ -
|
|
-
|
$ -
|
|
$ -
|
$ -
|
|
|
|
|
|
|
|
|
|
Issuances of preferred stock
|
1
|
-
|
|
-
|
-
|
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Issuances of common stock
|
-
|
-
|
|
27,724,684
|
-
|
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Net income
|
-
|
-
|
|
-
|
-
|
|
379
|
379
|
Balances - December 31, 2019
|
1
|
$ -
|
|
27,724,684
|
$ -
|
|
$ 379
|
$ 379
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an
integral part of these audited financial statements.
GiveMePower Corporation
and Subsidiary
Consolidated Statement of Cash Flows
August 30, 2019 (date of formation) to December 31, 2019
|
|
Amount
|
Cash flows from operating activities:
|
|
|
|
Cash received from sales of trading securities
|
$
|
29,412
|
|
Interest paid
|
|
(12)
|
|
Purchases of inventory under trading securities
|
|
(74,417)
|
Net cash flow from operating activities
|
|
(45,017)
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
Borrowing on loan payable to related party
|
|
41,200
|
|
Borrowing from brokerage loan - marginal loan
|
|
4,317
|
Net cash provided by financing activities
|
|
45,517
|
|
|
|
|
Net increase in cash
|
|
500
|
|
|
|
|
Cash - beginning of year
|
|
-
|
Cash - end of year
|
$
|
500
|
|
|
|
|
Supplemental disclosures of cash flow information
|
|
|
|
Cash paid during the year for:
|
|
|
|
Interest
|
$
|
12
|
|
Income taxes
|
|
-
|
The accompanying notes are an
integral part of these audited financial statements.
1.
NATURE OF OPERATIONS
Prior Business and Reverse Merger
GiveMePower Corporation (the “PubCo” or “Company”), a Nevada corporation, was incorporated on June 7, 2001 to sell
software geared to end users and developers involved in the design,
manufacture, and construction of engineered products located in Canada and the
United States. The PubCo has been dormant and non-operating since year 2009.
PubCo is a public reporting company registered with the Securities Exchange
Commissioner (“SEC”). In November 2009, the Company filed Form 15D, Suspension
of Duty to Report, and as a result, the Company was not required to file any
SEC forms since November 2009
On December
31, 2019, PubCo sold one Special 2019 series A preferred share (“Series A
Share”) for $38,000 to Goldstein Franklin, Inc. (“Goldstein”), a California
corporation. One Series A Share is convertible to 100,000,000 shares of common
stocks at any time. The Series A Share also provided with 60% voting rights of
the PubCo. On the same day, Goldstein sold one-member unit of Alpharidge
Capital, LLC (“Alpharidge”), a California limited liability corporation,
representing 100% member owner of Alpharidge. As a result, Alpharidge become a
wholly owned subsidiary of PubCo as of December 31, 2019.
The
transaction above will be accounted for as a “reverse merger” and
recapitalization amongst PubCo, Goldstein, and Alpharidge since the
stockholders of Alpharidge will have the significant influence and the ability
to elect or appoint or to remove a majority of the members
of the governing body of the combined
entity immediately following the completion of the transaction, the stockholders of PubCo will have the significant influence
and the ability
to elect or appoint
or to remove a majority
of the members of the governing body of the combined entity,
and PubCo’s senior management will dominate the
management of the combined entity immediately following the completion of the
transaction. Accordingly, Alpharidge will be deemed to be the accounting
acquirer in the transaction and, consequently, the transaction is treated as a
recapitalization of the PubCo. Accordingly, the assets and liabilities and the
historical operations that are reflected in the financial statements are those
of Alpharidge and are recorded at the historical cost basis of Alpharidge. As a
result, Alpharidge is the surviving company and the financial statements
presented are historical financial accounts of
Alpharidge.
The
financial statements of the Company include its wholly owned subsidiary of
Alpharidge.
Current Business and Organization
The Company,
through its wholly owned subsidiary, Alpharidge Capital, LLC, has two distinct
lines of businesses that comprise of the following:
·
Investments in securities,
warrants, bonds, or options of public and private companies in various
industries but focusing on specialty biopharmaceutical companies through
brokerage firm, TD Ameritrade; and
·
Investments in real estate – Real
estate operations would consist primarily of rental real estate, affordable
housing projects, opportunity zones, other property
development and associated HOA activities. Alpharidge’s property development
operations would be primarily through a real estate investment, management and
development subsidiary that focuses primarily
on the construction and sale of single-family and multi-family
homes, lots in subdivisions and planned communities, and raw land for residential development. Alpharidge
did not have any investments in real estate as of and for the years ended
December 31, 2019.
Reporting
The financial statements
include its historical financial information of the Company.
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Consolidation
The
accompanying financial statements have been prepared using the accrual basis of
accounting in accordance with generally accepted accounting principles (“GAAP”)
promulgated in the United States of America.
Use of Estimates and Assumptions
The
preparation of financial statements in conformity with the GAAP 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.
Advertising and Marketing Costs
Advertising
and marketing costs are recorded as general and administrative expenses when
they are incurred. The Company did not incur any advertising and marketing expenses
for the period August 30, 2019 (date
of formation) to December 31, 2019.
Revenue Recognition
The Company
recognizes revenue in accordance with Accounting Standards
Codification (“ASC”) 606, Revenue from Contracts with Customers. The Company’s net revenue primarily consists of revenues
from sales of trading securities using its broker firm, TD
Ameritrade less original purchase cost. Net trading revenues primarily consist
of revenues from trading securities earned upon completion of trade, net of any
trading fees. A trading is completed when earned and recognized at a point in time, on a trade-date basis, as the Company executes
trades. The Company
records trading revenue on a
net basis, trading sales less original purchase cost. Net realized gains and
losses from securities transactions are determined for federal income tax and
financial reporting purposes on the first-in, first-out method and represent
proceeds on disposition of investments less the cost basis of investments.
Investment – Trading Securities
All investment
securities are classified as trading securities and are carried at fair value
in accordance with ASC 320 Investments — Debt and Equity
Securities. Investment transactions are recorded on a trade date basis.
Realized gains or losses on sales of investments are based on the first-in, first-out or the specific identification method. Realized and unrealized gains or losses
on investments are recorded in the statements of operations as realized and unrealized gains or losses as net revenue. All
investment securities are held and transacted by the Company’s broker firm, TD
Ameritrade. The Company did not hold more than 3% of equity of the shares of
portfolio companies as investments as of December 31, 2019.
All
investments that are listed on a securities exchange are valued at their last
sales price on the primary securities exchange
on which such securities are traded on such date. Securities that are not listed on any exchange
but are traded over-the-counter are valued at the mean between the last
“bid” and “ask” price for such security on such date. The Company does not have
any investment securities for which market quotes are not readily available.
The Company’s
trading securities are held by a third-party brokerage firm, TD Ameritrade, and composed of publicly
traded companies with readily available fair value which are quoted prices in
active markets.
2. SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES (continued)
Income Taxes
Under the asset and liability method
prescribed within ASC 740, Income Taxes, the Company recognizes deferred tax assets
and liabilities for the future tax consequences attributable to differences
between financial statement carrying amounts of assets and liabilities and
their respective tax bases. Deferred tax assets and liabilities are measured
using enacted tax rates expected to apply to taxable income in the years in
which those temporary differences are expected to be realized or settled. The effect of a change
in tax rates on deferred
tax assets and liabilities is recognized in income
in the period that includes the enactment date. The realizability of deferred
tax assets is assessed throughout the year and a valuation allowance is
recorded if necessary, to reduce net deferred tax assets to the amount more
likely than not to be realized. Certain prior period deferred tax disclosures
were reclassified to conform with current period presentation.
ASC 740
provides that a tax benefit from an uncertain tax position may be recognized
when it is more likely than not that the position
will be sustained
upon examination, including resolutions of any related appeals
or litigation processes, based on the technical merits
of the position. ASC 740 also provides guidance on measurement, derecognition,
classification, interest and penalties, accounting in interim periods,
disclosure, and transition.
The Company’s
practice is to recognize interest accrued related to unrecognized tax benefits
in interest expense and penalties in selling and administrative expense. As of
December 31, 2019, the Company had no accrued interest or penalties.
Concentrations of Credit Risk
The Company's
financial instruments that are exposed
to concentrations of credit risk primarily consist
of its cash and cash
equivalents. The Company places its cash and cash equivalents with financial
institutions of high credit worthiness. The Company
maintains cash balances
at financial institutions within the United
States which are insured
by the Federal Deposit Insurance Corporation (“FDIC”) up to limits of approximately
$250,000. The Company has not experienced any losses with regard to its bank
accounts and believes it is not exposed to any risk of loss on its cash bank
accounts. It is possible that at times, the company’s cash and cash equivalents
with a particular financial institution may exceed any applicable government
insurance limits. In such situation, the Company's management would assess the
financial strength and credit worthiness of any parties to which it extends
funds, and as such, it believes that any associated credit risk exposures would
be addressed and mitigated.
The Company’s
trading securities is comprised of investments in biopharma public companies.
The Company had equity interests in more than 42 specialty biopharmaceuticals
companies as of December 31, 2019.
2. SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES (continued)
Fair Value of Financial Instruments
The Company
utilizes ASC 820-10,
Fair Value Measurement and Disclosure, for valuing financial
assets and liabilities measured on a recurring basis.
Fair value is defined as the exit price, or the amount that would be received
to sell an asset or paid to transfer a liability in an orderly transaction
between market participants as of the measurement date. The guidance
also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable
inputs and minimizes the use of unobservable inputs by requiring that the most
observable inputs be used when available. Observable inputs
are inputs market
participants would use in valuing
the asset or liability and are developed based on market data obtained from sources independent of the Company.
Unobservable inputs are inputs that reflect
the Company’s assumptions about the factors market participants would use in
valuing the asset or liability. The guidance establishes three levels of inputs
that may be used to measure fair value:
Level 1.
Observable inputs such as quoted prices in active markets;
Level 2.
Inputs, other than the quoted prices in active markets, that are observable
either directly or indirectly; and Level 3. Unobservable inputs in which there is little or no market
data, which require
the reporting entity
to develop its own assumptions.
The Company’s
financial instruments consisted of cash, accounts payable and accrued
liabilities, and line of credit. The estimated
fair value of cash, accounts
payable and accrued
liabilities, due to or from affiliated companies, and notes payable approximates
its carrying amount due to the short maturity of these instruments.
The table
below describes the Company’s valuation of financial instruments using guidance
from ASC 820-10:
December 31, 2019
|
|
Level 1
|
Level 2
|
|
Level 3
|
Investments – trading
securities
|
$
|
45,396
|
$
|
-
|
$
|
-
|
Leases
Prior to
January 1, 2019, the Company accounted for leases under Accounting Standards
Codification (ASC) 840, Accounting for Leases. Effective from January 1, 2019,
the Company adopted the guidance of ASC 842, Leases, which requires an entity
to recognize a right-of-use asset and a lease liability for virtually all
leases. On February 25, 2016, the FASB issued
Accounting Standards Update No. 2016-02, Leases (Topic 842), to increase transparency and comparability among
organizations by recognizing lease assets and lease liabilities on the balance
sheet and disclosing key information about leasing
transactions. ASC 842 requires that lessees recognize right of use assets and
lease liabilities calculated based on the present value of lease payments for
all lease agreements with terms that are greater than twelve months.
ASC 842
distinguishes leases as either a finance lease or an operating lease that
affects how the leases are measured and presented in the statement of operations and statement of cash flows.
ASC 842 supersedes nearly all existing lease accounting guidance under GAAP
issued by the Financial Accounting Standards Board (“FASB”) including ASC Topic
840, Leases.
The Company
does not have operating and financing leases as of December 31, 2019. The
adoption of ASC 842 did not materially impact our results of operations, cash
flows, or presentation thereof.
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Recent Accounting Standards Updates
In February
2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic
842), which supersedes FASB ASC Topic 840, Leases. This ASU requires
the recognition of right-of-use assets
and lease liabilities by lessees for those leases
classified as operating leases under previous guidance. In addition, among
other changes to the accounting for leases, this ASU retains the distinction
between finance leases and operating leases. The classification criteria for
distinguishing between financing leases and operating leases are substantially
like the classification criteria for distinguishing between capital leases and
operating leases under previous guidance.
Recently Adopted Accounting Pronouncements
ASU 2016-02 — On October 1, 2019,
the Company adopted Accounting Standards Update ("ASU") 2016-
02, Leases, by applying the standard at the adoption date, recognizing a
cumulative-effect adjustment to the opening balance of retained earnings. As a
result, restated financial information and the additional disclosures required
under the new standard will not be provided for the comparative periods
presented. The new guidance requires quantitative and qualitative disclosures that provide information about the amounts
related to leasing
arrangements recorded in the
condensed consolidated financial
statements. The Company
elected a package
of practical expedients available under the
new guidance, which allows an entity to not reassess prior conclusions related
to existing contracts containing leases, lease classification and initial
direct costs. In addition, the Company has elected to apply the short-term
lease exception for lease arrangements with a maximum
term of 12 months or less. Upon the adoption
of the lease standard, the
Company recognized a right-of-use ("ROU") asset and a lease liability
on the Condensed Consolidated Balance Sheet related to non-cancelable operating leases.
Recently Issued Accounting Pronouncements
ASU 2019-12 — In
December 2019, the Financial Accounting Standards Board ("FASB")
issued ASU 2019- 12, Simplifying the Accounting for Income Taxes. The
amendments in ASU 2019-12 simplify the accounting for income taxes by removing
certain exceptions to the general
principles in Accounting Standards Codification ("ASC") Topic 740, Income Taxes.
The amendments also improve consistent application of and simplify GAAP for other areas
of Topic 740 by clarifying and amending existing guidance. ASU 2019-12 will be
effective for the Company's fiscal year beginning October 1, 2021, with early
adoption permitted. The transition requirements are dependent upon each
amendment within this update and will be applied either prospectively or
retrospectively. The Company does not expect this ASU to have a material impact
on its condensed consolidated financial statements.
ASU 2016-13 — In June 2016, the
FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments.
The main objective of ASU 2016-13 is to provide financial statement users with
more decision-useful information about an entity's expected credit losses on
financial instruments and other commitments to extend credit at each reporting
date. To achieve this objective, the amendments in this update replace the
incurred loss impairment methodology in current GAAP with a methodology that
reflects expected credit losses and requires consideration of a broader range
of reasonable and supportable information to develop credit loss estimates.
Subsequent to issuing ASU 2016-13, the FASB has issued additional standards for
the purpose of clarifying certain aspects of ASU 2016- 13, as well as providing codification improvements and targeted
transition relief under
the standard. The subsequently
issued ASUs have the same effective date and transition requirements as ASU 2016-13. ASU 2016-13 will be effective for the Company's fiscal year
beginning October 1, 2020, using a modified retrospective approach. Early
adoption is permitted. The Company
is currently assessing
the impact this ASU will have on its condensed consolidated financial
statements.
3.
INVESTMENT SECURITIES (TRADING)
The Company
applied the fair value accounting treatment for trading securities per ASC 320,
with unrealized gains and losses recorded in net income each period. Debt securities
classified as trading should be measured at fair value in the currency in which
the debt securities are denominated and remeasured into the investor’s
functional currency using the spot exchange rate at the balance sheet date.
Investments
in equity securities as of December 31, 2019 are summarized based on the
following:
December 31,
|
|
Cost
|
|
Changes in Fair Value
|
|
Fair Value
|
|
|
|
|
|
|
|
Stocks
|
$
|
21,719
|
$
|
733
|
$
|
22,452
|
Options
|
|
29,414
|
|
(6,470)
|
|
22,944
|
Investments - Trading Securities
|
$
|
51,133
|
$
|
(5,737)
|
$
|
45,396
|
Trading securities are treated using the fair value method,
whereby the value of the securities on the company’s balance sheet is equivalent to their current market value.
These securities will be recorded in the current assets section under the Investment Securities account and will be offset in the shareholder’s equity section under the unrealized proceeds from sale of short-term investments” account. The Short
Term Investments account amount represents the current market value
of the securities, and the “Unrealized Proceeds
From Sale of Short Term Investments” account
represents the cash proceeds that the company would receive if it were
to sell the investments at the end of the specified accounting period.
August 30, 2019 (date of formation) to December 31, 2019
|
Amount
|
Total investment purchases - cost
|
$
|
74,417
|
Total investment sales - fair value
|
|
(29,412)
|
Unrealized losses
|
|
391
|
Investments - Trading Securities
|
$
|
45,396
|
4.
MARGINAL LOAN PAYABLE
The Company entered into a
marginal loan in December 2019 with TD Ameritrade, the Company’s brokerage to
continue the purchase of securities and to fund the underfunded balance.
4.
MARGINAL LOAN PAYABLE (continued)
The marginal
loan consisted of the following:
August 30, 2019 (date of formation) to December 31, 2019
|
|
|
|
Beginning balance - August 30, 2019
|
$
|
-
|
Funds deposited to broker by Company
|
|
(40,700)
|
Total investment securities purchases
|
|
74,417
|
Total sales of investment securities
|
|
(29,412)
|
Interest expense
|
|
12
|
Net unrealized gain (loss)
|
|
|
Marginal loan payable
|
$
|
4,317
|
5.
LINE OF CREDIT – RELATED PARTY
The Company
considers its founders, managing directors, employees, significant
shareholders, and the portfolio Companies to be affiliates. In addition, companies controlled by any of the above named
is also classified as affiliates.
Line of
credit from related party consisted of the following:
August 30, 2019 (date of formation) to December 31, 2019
|
Amount
|
September 2019 (line of credit) - line of
credit with maturity date of February 2020 with unpaid principal balance and
accrued interest payable on the maturity date.
|
$
|
41,200
|
|
|
|
Total Line of credit - related party
|
$
|
41,200
|
Goldstein Franklin, Inc. - $100,000 line of
credit
On September
15, 2019, the Company entered
into a line of credit agreement in the amount of $41,200
with maturity date of February 15, 2020. The line of credit bears
interest at 0% per annum and interest
and unpaid principal balance is payable on the maturity date. The Company had unused
line of credit of $48,800 as of December 31,
2019
6.
NET TRADING REVENUE
The Company
recognizes revenue in accordance with Accounting Standards
Codification (“ASC”) 606, Revenue from Contracts with Customers. The Company’s net revenue primarily consists of revenues
from sales of trading securities using its broker firm, TD
Ameritrade less original purchase cost. Net trading revenues primarily consist
of revenues from trading securities earned upon completion of trade, net of any
trading fees. A trading is completed when earned and recognized at a point in time, on a trade-date basis, as the Company executes
trades. The Company
records trading revenue on a
net basis, trading sales less original purchase cost.
Net trading
revenue consisted of the following:
August 30, 2019 (date of formation) to December 31, 2019
|
Amount
|
Revenue from sale of securities
|
$
|
29,412
|
Cost of securities
|
|
(23,472)
|
Wash sales
|
|
261
|
Net changes in fair value at end of year
|
|
(5,737)
|
Net trading revenue
|
$
|
464
|
7.
EARNINGS (LOSS) PER SHARE
A basic
earnings per share is computed by dividing net income to common stockholders by
the weighted average number of shares outstanding for the year. Dilutive
earnings per share include the effect of any potentially dilutive debt or
equity under the treasury stock method, if including such instruments is
dilutive. The Company’s diluted earnings (loss) per share is the same as the
basic earnings/loss per share for the period August 30, 2019 (date of
formation) to December 31, 2019, as there are no potential shares outstanding
that would have a dilutive effect.
August 30, 2019 (date of formation) to December 31, 2019
|
Amount
|
Net income
|
$
|
464
|
Dividends
|
|
-
|
Stock option
|
|
-
|
Adjusted net income attribution to
stockholders
|
$
|
464
|
|
|
|
Weighted-average shares of common stock
outstanding
|
Basic and Diluted
|
|
27,724,684
|
Net changes in fair value at end of year
|
|
|
Basic and Diluted
|
$
|
0.00
|
8.
INCOME TAXES
As of December
31, 2019, the Company had a net operating income carry forward of $104, which
may be available to reduce future
years’ taxable income
through 2040. The company uses the tax rate of 40% for its tax-assets estimates.
The provision for income taxes
differs from the amount computed
by applying the statutory federal
income tax rate to
income before provision for income
taxes. The sources
and tax effects
of the differences for the periods presented are as follows:
Realization of deferred tax assets is dependent upon sufficient future
taxable income during the period that deductible temporary differences and carry-forwards are expected to be available to reduce taxable
income. Due to the change
in ownership provisions of the Income Tax laws of the United States,
2019 net operating income carry forwards of approximately $0 for federal income
tax reporting purposes may be subject to annual limitations. Should a change in
ownership occur net operating income carry forwards may be limited as to use in
future years. As the realization of required future taxable income is
uncertain, the Company recorded a valuation
allowance.
August 30, 2019 (date of formation) to December 31, 2019
|
Amount
|
Deferred tax assets:
|
|
|
Net operating income
|
$
|
104
|
Other temporary differences
|
|
-
|
|
|
|
Total deferred tax assets
|
|
104
|
Less- valuation allowance
|
|
(104)
|
Total deferred tax assets
|
$
|
-
|
The Company
did not have material income tax provision (benefit) because of net loss and
valuation allowances against deferred income tax provision for the period August
30, 2019 (date of formation) to December 31, 2019
A
reconciliation of the Company’s effective tax rate to the statutory federal
rate is as follows:
Description
|
|
Rate
|
Statutory federal rate
|
|
21%
|
State income taxes net of federal income
tax benefit and others
|
0%
|
Permanent differences for tax purposes and
others
|
0%
|
Change in valuation allowance
|
|
-21%
|
Effective tax rate
|
|
-
|
The income tax benefit differs from the amount computed by applying the
U.S. federal statutory tax rate of 21%, primarily due to the change in the valuation
allowance and state income tax benefit, offset
by nondeductible expenses. Deferred income taxes reflect
the net tax effects of temporary differences between the carrying
amounts of assets
and liabilities for financial reporting purposes and the amounts used
for income tax purposes.
9.
RELATED PARTY TRANSACTIONS
The Company had the following
related party transactions:
·
Line of Credit – On September 15, 2019, the Company entered
into a line of credit
agreement in the amount
of $41,200 with Goldstein Franklin, Inc. which is owned and operated by Frank I. Igwealor, Chief
Executive Officer of the Company. The maturity date of the line of credit is February 15, 2020. The line of credit bears interest at 0% per annum and
interest and unpaid principal balance is payable on the maturity date. The
Company had unused line of credit of $48,800 as of December 31, 2019
10.
COMMITMENTS AND CONTINGENCIES
Contingencies
From time to
time, the Company may be involved in certain legal actions and claims arising
in the normal course of business. Management is of the opinion that such
matters will be resolved without material effect on the Company’s financial
condition or results of operations.
11.
SUBSEQUENT EVENTS
The Company
evaluated all events or transactions that occurred after December 31, 2019 up
through the date the financial statements were available to be issued. During
these periods, the Company did not have any material recognizable subsequent
events required to be disclosed as of and for the year ended December 31, 2019.
EXHIBIT 31.1
CERTIFICATION AS ADOPTED PURSUANT TO
SECTION 302(A)
OF THE SARBANES-OXLEY ACT OF 2002
I, Frank I. Igwealor, certify that:
1. I have
reviewed this annual report on Form 10-K of GiveMePower Corporation;
2. Based on my
knowledge, this report does not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements,
and other financial information included in this report, fairly present in
all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods
presented in this report;
4. The
registrant’s other certifying officer(s) and I are responsible for establishing
and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
registrant and have:
(a) Designed
such disclosure controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision,
to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this report is being
prepared;
(b) Designed
such internal control over financial reporting, or caused such internal control
over financial reporting to be designed under our supervision, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and
procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as of the
end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal
control over financial reporting that occurred during the registrant ’s most recent
fiscal quarter (the registrant ’s
fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant ’s internal control over
financial reporting; and
5. The
registrant’s other certifying officer(s) and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to the registrant ’s auditors
and the audit committee of the registrant ’s board of directors (or persons performing
the equivalent functions):
(a) All
significant deficiencies and material weaknesses in the design or operation of
internal control over financial reporting which are reasonably
likely to adversely affect the registrant ’s
ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant ’s
internal control over financial reporting.
Date:
May 18, 2020
|
/s/ Frank
I. Igwealor
|
|
Frank
I. Igwealor, JD, CPA, CMA, MBA, MSRM
|
|
President
Chief
Executive Officer and
|
|
Chief
Financial Officer
Principal Executive Officer, Treasurer, Principal Accounting Officer, Principal Financial Officer,
Director & Secretary
|
Date:
May 18, 2020
|
/s/ Patience C Ogbozor
|
|
Patience
C Ogbozor
|
|
Director
|
EXHIBIT 32.1
CERTIFICATION PURSUANT TO 18 U.S.C.
SECTION 1350, AS ADOPTED
PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of GiveMePower
Corporation, Inc. (the “Company”) on Form 10-K for the fiscal year ended December
31, 2019, as filed with the Securities
and Exchange Commission on the date hereof (the “Report”), I, Frank
I. Igwealor, President, Chief Executive
Officer and Chief Financial Officer of the Company, certify,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that, to my
knowledge: (1) the Report fully complies with the requirements of Section 13(a)
or 15(d) of the Securities Exchange Act of 1934; and (2) the
information contained in the Report fairly presents, in all material respects,
the financial condition and results of operations of the Company.
Date:
May 18, 2020
|
/s/ Frank
Igwealor
|
|
Frank
Igwealor, JD, CPA, CMA, MBA, MSRM
|
|
President
Chief
Executive Officer and
|
|
Chief
Financial Officer
Principal Executive Officer, Treasurer, Principal Accounting
Officer, Principal Financial Officer, Director & Secretary
|
Date:
May 18, 2020
|
/s/ Patience C Ogbozor
|
|
Patience
C Ogbozor
|
|
Director
|
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