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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM 10-Q
☒ QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the quarterly period ended September 30, 2022
☐ TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period from _________ to _________
Commission
File Number: 333-192874
ZHRH CORPORATION
(Exact
name of Registrant as specified in its charter)
Nevada |
|
99-0369270 |
(State of incorporation) |
|
(IRS Employer ID Number) |
50 West Liberty Str. Suite 880, Reno, NV 89501
(Address
of Principal Executive Offices) Zip Code
775-322-06261
(Registrant’s
telephone number)
Not
Applicable
(Former
name, former address and former fiscal year, if changed since last report)
Indicate
by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes ☒ No ☐
Indicate
by check mark whether the registrant has submitted every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required
to submit such files).
Yes ☒ No ☐
Indicate
by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer” “smaller
reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
☐ |
Accelerated filer |
☐ |
Non-accelerated filer |
☒ |
Smaller reporting company |
☒ |
|
Emerging Growth Company |
☐ |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☒ No ☐
As
of November 14, 2022, there were 75,000,000 shares of our common stock issued and outstanding.
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain
information included in this Quarterly Report on Form 10-Q and other filings of the Registrant under the Securities Act of 1933,
as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
as well as information communicated orally or in writing between the dates of such filings, contains or may contain “forward-looking
statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking
statements in this Quarterly Report on Form 10-Q, including without limitation, statements related to our plans, strategies, objectives,
expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Such statements are subject to certain risks, trends and uncertainties that could cause actual results to differ
materially from expected results. Among these risks, trends and uncertainties are the availability of working capital to fund our operations,
the competitive market in which we operate, the efficient and uninterrupted operation of our computer and communications systems, our
ability to generate a profit and execute our business plan, the retention of key personnel, our ability to protect and defend our intellectual
property, the effects of governmental regulation, and other risks identified in the Registrant’s filings with the Securities and
Exchange Commission from time to time.
In
some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “should,”
“could,” “expects,” “plans,” “anticipates,” “believes,” “estimates,”
“predicts,” “potential” or “continue” or the negative of such terms or other comparable terminology.
Although the Registrant believes that the expectations reflected in the forward-looking statements contained herein are reasonable, the
Registrant cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither the Registrant, nor any
other person, assumes responsibility for the accuracy and completeness of such statements. The Registrant is under no duty to update
any of the forward-looking statements contained herein after the date of this Quarterly Report on Form 10-Q.
TABLE
OF CONTENTS
ZHRH
Corp
formerly
known as
Ketdarina
Corp.
Balance
Sheets
(Stated
in U.S. Dollars)
| |
| | | |
| | |
| |
September 30, | | |
June 30, | |
| |
2022 | | |
2022 | |
ASSETS | |
| | | |
| | |
Current assets | |
| | | |
| | |
Cash and cash equivalents | |
$ | 154,449 | | |
$ | 180,079 | |
Total current assets | |
| 154,449 | | |
| 180,079 | |
TOTAL ASSETS | |
$ | 154,449 | | |
$ | 180,079 | |
| |
| | | |
| | |
LIABILITIES AND STOCKHOLDERS’ DEFICIT | |
| | | |
| | |
Current liabilities | |
| | | |
| | |
Accrued liabilities and other current liabilities | |
$ | 239,621 | | |
$ | 150,811 | |
Related parties loan payable | |
| 228,382 | | |
| 228,382 | |
Convertible note, net of discount | |
| 430,000 | | |
| 430,000 | |
Common stock payable | |
| 200,072 | | |
| 123,926 | |
Total current liabilities | |
| 1,098,075 | | |
| 933,119 | |
TOTAL LIABILITIES | |
| 1,098,075 | | |
| 933,119 | |
| |
| | | |
| | |
COMMITMENTS & CONTINGENCIES | |
| - | | |
| - | |
| |
| | | |
| | |
STOCKHOLDERS’ DEFICIT | |
| | | |
| | |
Common stock, no par value; 75,000,000 shares authorized, 75,000,000 shares issued and outstanding at September 30, 2022 and June 30, 2022 | |
| 75,000 | | |
| 75,000 | |
Additional paid-in capital | |
| (15,115 | ) | |
| (15,115 | ) |
Accumulated deficit | |
| (1,003,511 | ) | |
| (812,925 | ) |
TOTAL STOCKHOLDERS’ DEFICIT | |
| (943,626 | ) | |
| (753,041 | ) |
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | |
$ | 154,449 | | |
$ | 180,079 | |
See
accompanying notes to the financial statements
ZHRH
Corp
formerly
known as
Ketdarina
Corp.
Statements
of Operations and Comprehensive Income
(Stated
in U.S. Dollars)
| |
| | | |
| | |
| |
For the three months ended | |
| |
September 30, | |
| |
2022 | | |
2021 | |
Operating expenses | |
| | | |
| | |
Legal fees | |
| 6,290 | | |
| 97,177 | |
Audit and accounting fees | |
| 40,600 | | |
| 51,100 | |
Consulting fees | |
| 130,986 | | |
| 44,141 | |
General and administrative expense | |
| 988 | | |
| - | |
Total operating expense | |
| 178,864 | | |
| 192,418 | |
| |
| | | |
| | |
Loss from operations | |
| (178,986 | ) | |
| (192,418 | ) |
| |
| | | |
| | |
Other income (expense) | |
| | | |
| | |
Interest expense | |
| (11,721 | ) | |
| - | |
Total other income (expense) | |
| (11,721 | ) | |
| - | |
| |
| | | |
| | |
Net loss | |
$ | (190,585 | ) | |
$ | (192,418 | ) |
Net loss per common share – basic and diluted | |
$ | (0.00 | ) | |
$ | (0.00 | ) |
Weighted average common shares outstanding – basic and diluted | |
| 75,000,000 | | |
| 75,000,000 | |
See
accompanying notes to the financial statements
ZHRH
Corp
formerly
known as
Ketdarina
Corp.
Statements
of Cash Flows
(Stated
in U.S. Dollars)
| |
| | | |
| | |
| |
For the Three Months Ended | |
| |
September 30, | | |
September 30, | |
| |
2022 | | |
2021 | |
Cash flows from operating activities | |
| | | |
| | |
Net loss | |
$ | (190,585 | ) | |
| (192,418 | ) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities | |
| | | |
| | |
Stock based compensation | |
| 76,146 | | |
| - | |
Changes in assets and liabilities | |
| | | |
| | |
Increase in accruals and other payables | |
| 88,810 | | |
| 101,102 | |
Increase in related party payables | |
| - | | |
| 91,315 | |
Net cash used in operating activities | |
| (25,630 | ) | |
| - | |
| |
| | | |
| | |
Proceeds from Convertible note | |
| - | | |
| - | |
Payments on related party debt | |
| - | | |
| - | |
Net cash used in financing activities | |
| - | | |
| - | |
| |
| | | |
| | |
Net increase in cash and cash equivalents | |
| (25,630 | ) | |
| - | |
Effect of foreign currency translation on cash and cash equivalents | |
| - | | |
| - | |
Cash and cash equivalents–beginning of period | |
| 180,079 | | |
| - | |
Cash and cash equivalents–end of period | |
| 154,449 | | |
| - | |
| |
| | | |
| | |
Supplementary cash flow information: | |
| | | |
| | |
Interest paid | |
$ | - | | |
| - | |
Income taxes paid | |
$ | - | | |
| - | |
| |
| | | |
| | |
Non-Cash Financing and Investing Activities: | |
| | | |
| | |
Forgiveness of related party debt | |
| - | | |
| (5,801 | ) |
Payment on related party debt | |
| | | |
| - | |
Common stock issuable in conjunction with Convertible Note | |
| - | | |
| - | |
See
accompanying notes to the financial statements
ZHRH
Corp
formerly
known as
Ketdarina
Corp.
Statements
of Stockholders’ Equity (Deficit)
(Stated
in U.S. Dollars)
For
the three months ended September 30, 2022
| |
| | | |
| | | |
| | | |
| | | |
| | |
| |
Common Stock | | |
Additional | | |
| | |
Total | |
| |
Number of
Shares | | |
Par
Value | | |
Paid In
Capital | | |
Accumulated
Deficit | | |
Stockholders’
Deficit | |
Balance - June 30, 2022 | |
| 75,000,000 | | |
$ | 75,000 | | |
$ | (15,115 | ) | |
$ | (812,925 | ) | |
$ | (753,041 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Net loss | |
| - | | |
| - | | |
| - | | |
| (190,585 | ) | |
| (190,585 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Balance - September 30, 2022 | |
| 75,000,000 | | |
$ | 75,000 | | |
$ | (15,115 | ) | |
$ | (1,003,511 | ) | |
$ | (943,626 | ) |
For
the three months ended September 30, 2021
| |
Common Stock | | |
Additional | | |
| | |
Total | |
| |
Number of
Shares | | |
Par
Value | | |
Paid In
Capital | | |
Accumulated
Deficit | | |
Stockholders’
Deficit | |
Balance - June 30, 2021 | |
| 75,000,000 | | |
$ | 75,000 | | |
$ | (20,916 | ) | |
$ | (222,768 | ) | |
$ | (168,684 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Forgiveness of related party debt | |
| | | |
| | | |
| 5,801 | | |
| | | |
| 5,801 | |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Net loss | |
| - | | |
| - | | |
| | | |
| (192,418 | ) | |
| (192,418 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | |
Balance - September 30, 2021 | |
| 75,000,000 | | |
$ | 75,000 | | |
$ | (15,115 | ) | |
$ | (415,186 | ) | |
$ | (355,301 | ) |
See
accompanying notes to the financial statements
ZHRH
Corp
formerly
known as
Ketdarina
Corp.
Notes
to Financial Statements
For
the three months ended September 30, 2022 and June 30, 2022
Note
1 – Organization and basis of accounting
Basis
of Presentation and Organization
Ketdarina
Corp. was incorporated under the laws of the State of Nevada on July 13, 2011. Until November 19, 2014, we were in the business
of wholesale of bedding products to industrial, commercial and institutional retailers, and other professional business users, or to
other wholesalers and related subordinated services.
On
November 19, 2014, as reported in our Form 8-K which was filed with the Securities and Exchange Commission on November 28,
2014, the previous principal shareholders: (a) sold their shares to Western Highlands Minerals, Ltd., a Vietnamese corporation “WHM”);
(b) resigned as our management and appointed WHM’s designees as new management, (c) took over the inactive bedding business from
us, and (d) cancelled all previous debt which we owed to them.
Since
the change of control, although engaging in ongoing discussions, WHM and its designees have not entered into any agreements or understandings
by which we would acquire any assets or a business.
On
December 16, 2020, as a result of a receivership in Clark County, Nevada, Case Number: A-20-816621-B, Custodian Ventures LLC (“Custodian”)
was appointed receiver of Ketdarina Corp. (the “Company”). On that same date, Custodian appointed David Lazar as the Company’s
Chief Executive Officer, President, Secretary, Chief Financial Officer, Chief Executive Officer and Chairman of the Board of Directors.
On
April 6, 2021, Custodian Ventures LLC (the “Seller”), entered into a Common Stock Purchase Agreement (the “SPA”)
pursuant to which the Seller agreed to sell to Calgary Thunder Bay Limited (the “Purchaser”), the 71,260,000 shares of common
stock of the Registrant (the “Shares”) owned by the Seller, constituting approximately 95.0% of the Registrant’s 75,000,000
issued and outstanding common shares, for $250,000. The sale was consummated on April 13, 2021. As a result of the sale, there was
a change of control of the Registrant. There is no family relationship or other relationship between the Seller and the Purchaser, or
any of the Purchaser’s affiliates.
On
that same date, Mr. David Lazar, who was the Registrant’s sole officer and director, submitted his resignation from all management
positions and appointed Brett Lovegrove (the “Designee”) as the sole director and officer of the Registrant. As a result
thereof, the Designee is now the sole director and officer of the Registrant.
The
accompanying condensed financial statements are prepared on the basis of accounting principles generally accepted in the United States
of America (“GAAP”). The Company is a development stage enterprise devoting substantial efforts to establishing a new business,
financial planning, raising capital, and research into products which may become part of the Company’s product portfolio. The Company
has not realized significant sales through since inception. A development stage company is defined as one in which all efforts are devoted
substantially to establishing a new business and, even if planned principal operations have commenced, revenues are insignificant.
Note
2 – Going Concern
The
accompanying condensed financial statements have been prepared assuming the continuation of the Company as a going concern. The Company
has not yet established an ongoing source of revenues sufficient to cover its operating costs and is dependent on debt and equity financing
to fund its operations. Management of the Company is making efforts to raise additional funding until a registration statement relating
to an equity funding facility is in effect. While management of the Company believes that it will be successful in its capital formation
and planned operating activities, there can be no assurance that the Company will be able to raise additional equity capital or be successful
in the development and commercialization of the products it develops or initiates collaboration agreements thereon. The accompanying
financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of
assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going
concern.
Note
3 – Summary of significant accounting policies
Cash
and Cash Equivalents
For
purposes of reporting within the statements of cash flows, the Company considers all cash on hand, cash accounts not subject to withdrawal
restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash and cash
equivalents.
Employee
Stock-Based Compensation
The
Company accounts for stock-based compensation in accordance with ASC 718 Compensation - Stock Compensation (“ASC 718”). ASC
718 addresses all forms of share-based payment (“SBP”) awards including shares issued under employee stock purchase plans
and stock incentive shares. Under ASC 718 awards result in a cost that is measured at fair value on the awards’ grant date, based
on the estimated number of awards that are expected to vest and will result in a charge to operations.
Fair
Value Measurement
The
Company values its amounts due to related partings and short term loans payable under FASB ASC 820 which defines fair value, establishes
a framework for measuring fair value, and expands disclosures about fair value measurements.
Fair
value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants
at the measurement date (exit price). The Company utilizes market data or assumptions that market participants would use in pricing the
asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can
be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability
of those inputs. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives
the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the
lowest priority to unobservable inputs (level 3 measurement).
The
three levels of the fair value hierarchy are as follows:
Level
1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets
are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on
an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities and
listed equities.
Level
2 – Valuations for assets and liabilities that can be obtained from readily available pricing sources via independent providers
for market transactions involving similar assets or liabilities. The Company’s principal markets for these securities are the secondary
institutional markets, and valuations are based on observable market data in those markets.
Level
3 – Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used
with internally developed methodologies that result in management’s best estimate of fair value. The Company uses Level 3 to value
its derivative instruments.
Subsequent
Event
The
Company evaluated subsequent events through the date when financial statements are issued for disclosure consideration.
Recent
Accounting Pronouncements
In
August 2020, the FASB issued Accounting Standards Update (ASU) No. 2020-06, Debt—Debt with Conversion and Other Options
(Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible
Instruments and Contracts in an Entity’s Own Equity. ASU No. 2020-06 simplifies the accounting for convertible instruments
by removing major separation models required under current U.S. GAAP. Consequently, more convertible debt instruments will be reported
as a single liability instrument and more convertible preferred stock will be reported as a single equity instrument, with no separate
accounting for embedded conversion features. The ASU also removes certain settlement conditions that are required for equity contracts
to qualify for the derivative scope exception, which will permit more equity contracts to qualify for the exception. In addition, ASU
No. 2020-06 simplifies the diluted earnings per share (EPS) calculation in certain areas. ASU No. 2020-06 is effective for public business
entities that meet the definition of an SEC filer, excluding entities eligible to be smaller reporting companies as defined by the SEC,
for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities,
ASU No. 2020-06 will be effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal
years. Early adoption is permitted in fiscal years beginning after December 15, 2020. An entity should adopt the guidance as of
the beginning of its annual fiscal year. The Company is currently evaluating the impact of this accounting pronouncement on its financial
statements.
Other
recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public
Accountants, and the SEC did not or in management’s opinion will not have a material impact on the Company’s present or future
consolidated financial statements.
Note
4 – Related Party Transactions
On
December 16, 2020, as a result of a receivership in Clark County, Nevada, Case Number: A-20-816621-B, Custodian Ventures LLC (“Custodian”)
was appointed receiver of Ketdarina Corp. (the “Company”). On that same date, Custodian appointed David Lazar as the Company’s
Chief Executive Officer, President, Secretary, Chief Financial Officer, Chief Executive Officer and Chairman of the Board of Directors.
During
the fiscal year July 01, 2020 thru April 06, 2021, David Lazar, paid $26,195 of expenses related transfer agent, state registration
fees and legal fees on behalf of the company. On March 09, 2021, the Company issued 71,260,000 shares of common stock issued at
par value of $0.001, as repayment of debt owed to Custodian Ventures, LLC in the amount of $18,355. On April 12, 2021, Custodian
Ventures forgave all amounts owing to them by the Company in the amount of $5,801. As of September 30, 2022 and June 30, 2022,
a total of $0 and $0, remains outstanding to Custodian Ventures, LLC, respectively.
During
the three months ended September 30, 2022, Calgary Thunder Bay paid $0 of expenses related to accounting, audit, legal and consulting
fees. As September 30, 2022 and June 30, 2022, a total of $228,382 remains outstanding to Calgary Thunder Bay Limited.
Note
5 – Convertible notes
On
January 24, 2022, the Company received $200,000 in exchange for a January 24, 2021 promissory convertible note in the amount
of $200,000 from an unrelated third party. The note matures on December 31, 2022 after the issuance date and bears a 10% interest
rate. The note is convertible at any time based on the indebtedness of such conversion divided by the value per share of common stock
as determined based on a company valuation of $30,000,000. There will be at a current fixed price of $0.40. Due to these provisions,
this convertible notes not qualify for derivative accounting under ASC 815-15, Derivatives and Hedging. In addition, this convertible
note was issued pursuant to a share purchase agreement between the Company and the note holder. The Company shall issue and sell to Buyer
a number of shares of Common Stock equal to (i) $200,000 (the “Shares Purchase Price”) divided by (ii) the value per share
of Common Stock as determined based on a valuation of the Company of $30,000,000 and the number of issued and outstanding shares of Common
Stock as of the Shares Closing (the “Shares”). By way of example and not limitation, in the event that as of the Shares Closing,
there are 75,000,000 shares of Common Stock issued and outstanding, Buyer will acquire 500,000 shares of Common Stock ($200,000 divided
by $0.40), at a purchase price of $0.40 per share of Common Stock.
On
March 07, 2022, the Company received $30,000 in exchange for a promissory convertible note in the amount of $30,000 from an unrelated
third party. The note matures on December 31, 2022 after the issuance date and bears a 10% interest rate. The note is convertible
at any time based on the indebtedness of such conversion divided by the value per share of common stock as determined based on a company
valuation of $30,000,000. There will be at a current fixed price of $0.40. Due to these provisions, this convertible notes not qualify
for derivative accounting under ASC 815-15, Derivatives and Hedging.
A
summary of value changes to the notes for the three months ended September 30, 2022 is as follows:
Schedule of Convertible notes | |
| | |
Carrying
value of Convertible Notes at July 01, 2022 | |
$ | 430,000 | |
New
principal | |
| - | |
Total
principal | |
| 430,000 | |
Less:
conversion of principal | |
| - | |
Add:
amortization of discount and deferred financing fees | |
| - | |
Carrying
value of Convertible Notes at September 30, 2022 | |
$ | 430,000 | |
Note
6 – Common stock
On
March 09, 2021, the Company issued 71,260,000 shares of common stock issued at par value of $0.001, as repayment of debt owed to
Custodian Ventures, LLC in the amount of $18,355.
As
of September 30, 2022 and June 30, 2022, 75,000,000 shares of common stock with a par value of $0.001 remain outstanding.
Note
7 – Commitments and Contingencies
Director
Agreement with Aymar de Lencqusaing, Brett Lovegrove, Cindy Li, James P. Bond, Jean-Michel Doublet and Lionel Therond
On
March 9, 2022, the Company entered into a Director Agreement with Aymar de Lencqusaing, Brett Lovegrove, Cindy Li, James P Bond,
Jean-Michel Doublet and Lionel Therond. Pursuant to each Director Agreement, each director agreed to perform the duties of a director
in accordance with the terms of the Director Agreement with a time commitment of 8-10 days per month, with 4 Board meetings per year.
The Director Agreement’s term starts on March 9, 2022 and terminates upon the earlier of the following to occur: (i) removal
of the individual as a director of the Company upon proper shareholder action in accordance with the Company’s articles, bylaws
and applicable law (ii)Individuals resignation as a director of the Company (iii) individuals death or (iv) failure of the shareholders
of the Company to re-elect the individual at the Company’s annual shareholder meeting or any special meeting of the shareholders
called for the purpose of electing directors.
Pursuant
to the Director Agreement, the Company agreed to indemnify each director, if he becomes a party, or is threatened to become a party,
to a proceeding (other than an action by or in the right of the Company) by reason of Each individuals status as a director in accordance
with the terms and conditions set forth in the Director Agreement. Pursuant to the Director Agreement, the Company agreed to obtain and
maintain director and officer insurance for the Company following the completion of the ZHRH Transaction and each director will be named
as an insured party under such insurance. There can be no assurance that the Company will enter into any letters of intent or any other
oral or written agreements in connection with the ZHRH Transaction, or that the ZHRH Transaction can occur at all.
Pursuant
to the Director Agreement, the Company agreed to compensate each director for such services by issuing each of them shares of the Company’s
common stock as follows:
|
● |
The
intent is that for each full year that he serves as a director of the Company, they’ll
receive a number of shares of the Company’s common stock having a total value of $80,000. |
|
|
|
|
● |
The
first grant of shares of common stock will be made on the closing of the ZHRH Transaction
and will be based on the length of each individuals service as a director of the Company
as of that date at the time of closing (the “First Grant”). The number of shares
of common stock to be issued in the First Grant shall be based on a value of each share of
common stock as determined based on the number of shares of common stock issued to the shareholders
of ZHRH China in the ZHRH Transaction assuming a pre-money valuation of ZHRH China of USD$30
million. In the event that each individual Ceases to serve as a director of the Company for
any reason prior to the vesting of the First Grant shares, such First Grant shares will be
automatically forfeited. |
|
|
|
|
● |
Following
the closing of the ZHRH Transaction, for each calendar quarter thereafter during which each
individual continues to serve as a director of the Company, the Company will grant each director
a restricted stock award of shares of the Company’s common stock having a fair market
value (as determined by the Board or a committee thereof, but in any case without the involvement
of Mr. Lovegrove) as of the last day of each such calendar quarter of $20,000 (each, a “Quarterly
Grant”). Each Quarterly Grant shall vest, if at all, on the one-year anniversary of
the applicable grant date, and, once vested, shall be subject to no additional contractual
lock-in period. In the event that a director ceases to serve as a director of the Company
for any reason, any Quarterly Grant which has not vested at such time will be automatically
forfeited. |
Note
8 – Subsequent Events
In
accordance with ASC 855 the Company’s management reviewed all material events through the date these financial statements were
available to be issued, there was only one material subsequent event.
ITEM 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Operating
results for the three months ended September 30, 2022, are not necessarily indicative of results that may occur in future interim
periods or for the full fiscal year.
As
used in this Form 10-Q, references to the Company,” “we,” “our” or “us” refer to ZHRH
Corporation. a Nevada Corporation unless the context otherwise indicates.
Forward-Looking
Statements
Our
Form 10 contains “forward–looking statements” within the meaning of the Private Securities Litigation Reform Act
of 1995 and such statements are intended to enjoy the benefit of that act. Unless the context is otherwise, we use words such as “anticipate”,
“assumption”, “believe”, “could”, “estimate”, “expect”, “forecast”,
“intend”, “may”, “objective”, “outlook”, “plan” and “plans”,
“potential”, “predict”, project” and “projection”, “seek”, “should”,
“will continue”, “will result” and “would”, or other such words, whether nouns or pronouns and verbs
or adverbs in the future tense and words and phrases that convey similar meaning and uncertainty of and information about future events
or outcomes and statements about performance that is not an historical fact to identify these forward–looking statements. Such
words and statements involve estimates, assumptions and uncertainties, which could cause actual results to differ materially from those
expressed in them. Any forward–looking statements are qualified in their entirety by reference to the factors discussed throughout
this document. All forward-looking statements concerning economic conditions, rates of growth, rates of income or values as may be included
in this document are based on information available to us on the dates noted, and we assume no obligation to update any such forward–looking
statements. It is important to note that our actual results may differ materially from those anticipated in such forward-looking statements
due to fluctuations in interest rates, inflation, government regulations, economic conditions and competitive product and pricing pressures
in the geographic and business areas in which we conduct operations, including our plans, objectives, expectations and intentions and
other factors discussed elsewhere in this registration statement.
There
are a number of important factors beyond our control that could cause actual results to differ materially from the results anticipated
by these forward–looking statements. While we make these forward–looking statements based on our beliefs and on various factors
and using numerous assumptions using information available at the time we make these statements. Forward-looking statements are neither
predictions nor guaranties of future events or circumstances, and the assumptions, beliefs, expectations, forecasts and projections about
future events may differ materially from actual results. You have no assurance the factors and assumptions we have used as a basis for
forward–looking statements will prove to be materially accurate when the events they anticipate actually occur in the future; and,
you should not place undue reliance on any such forward–looking statements. We undertake no obligation to publicly update any forward–looking
statement to reflect developments occurring after the date of this registration statement.
Business
Overview
ZHRH
Corporation (“we,” “our,” “us” or the “Company”) was originally incorporated in the State
of Nevada on July 13, 2011, as Ketdarina Corp. On May 7, 2021, the Company amended its Articles of Incorporation in Nevada
to change its corporate name to ZHRH Corporation, our current name, which became effective on July 16, 2021.
Until
November 19, 2014, the Company was in the business of wholesale of bedding products to industrial, commercial and institutional
retailers, and other professional business users, or to other wholesalers and related subordinated services. On November 19, 2014,
the Company’s then principal shareholders sold their shares of the Company to Western Highlands Minerals, Ltd., a Vietnamese corporation
(“WHM”), resigned from all positions with the Company and appointed WHM’s designees as new management; WHM then took
over the inactive bedding business from the Company, and cancelled all previous debt which was owed to them at that time.
In
or about 2015, the Company phased out of its prior business and became a “shell company,” as such term is defined in Rule 12b-2
under the Exchange Act of 1934, as amended (the “Exchange Act”).
On
December 11, 2020, as a result of a receivership in the Eighth Judicial District Court in Clark County, Nevada, Case Number: A-20-816621-B,
the plaintiff creditor in the case, Custodian Ventures LLC (the “Custodian”) received an order from the Clark County Court
appointing David Lazar as the receiver of the Company. On the same date, David Lazar was appointed as the Company’s Chief Executive
Officer, President, Secretary, Chief Financial Officer, Chief Executive Officer and Chairman of the Board of Directors. On December 29,
2020, the Company’s Charter was reinstated in the State of Nevada. The receivership was terminated by the Eighth Judicial District
Court in Clark County, Nevada, under Case Number: A-20-816621-B on May 10, 2021 and on the same date, the court also discharged
Mr. Lazar as the receiver.
On
March 9, 2021, pursuant to the approval of the board of directors of the Company dated March 9, 2021, the Company issued 71,260,000
shares of common stock, as repayment of debt owed to the Custodian, in the amount of $18,355.
On
April 6, 2021, the Custodian entered into a Common Stock Purchase Agreement (the “SPA”) with Calgary Thunder Bay Limited
(“Calgary”), pursuant to which Calgary purchased 71,260,000 shares of common stock of the Company from the Custodian, representing
95.01% of the total issued and outstanding shares of the Company’s common stock. The sale was consummated on April 13, 2021.
As a result of the sale, there was a change of control of the Company.
On
that same date, Mr. David Lazar, who was the Company’s then sole officer and director, submitted his resignation from all positions
with the Company and appointed Brett Lovegrove as the sole director and officer of the Company.
On
May 7, 2021, by consent of the Company’s sole director and Calgary, as majority shareholder, the Company amended its corporate
name to ZHRH Corporation and the name change became effective on July 16, 2021.
On
July 16, 2021, the Company changed its trading symbol from KTDR to ZHEC.
The
Company has no operations at this time, and currently does not have any principal products or services, customers or intellectual property.
As the Company has no current operations, it also currently is not subject to any competitive business conditions. Further, the Company
is not subject to any government approvals at this time, other than those applicable to it as a “shell company,” as such
term is defined in Rule 12b-2 under the Exchange Act.
On
October 4, 2021, the Board of Directors of the Company increased the size of the Board by two persons and appointed each James Purnell
Bond and Aymar de Lencquesaing as directors of the Company effective as of October 4, 2021. On October 4, 2021, the Board of
the Company adopted Amended and Restated Bylaws.
On
October 25, 2021, we entered into an amendment with Blue Oak Advisory Limited (“Blue Oak”) and Zhonguan Ruiheng Environmental
Technology Company Limited (“ZHRH China”) (the “Amendment”), which was an amendment to an original agreement
between ZHRH China and Blue Oak dated January 6, 2021, (the “Original Agreement”). The Company was not a party to the
Original Agreement between ZHRH China and Blue Oak. The Amendment is effective as of October 25, 2021, and sets forth that Mr. Jean-Michel
Doublet is to be appointed as the Company’s Chief Executive Officer and Mr. Lionel Therond is to be appointed as the Company’s
Chief Financial Officer. The Amendment was entered into with the intent to set forth renumeration to be received by Mr. Jean-Michel Doublet
and Mr. Lionel Therond in connection with any proposed business combination in which the Company acquires ZHRH China. The Company has
not entered into any agreements, letters of intent or any other oral or written agreements in connection with any proposed business combination
in which the Company acquires ZHRH China, other than the Amendment. There can be no assurance that the Company will enter into any letters
of intent or any other oral or written agreements in connection with any proposed business combination in which the Company acquires
ZHRH China, or that any such business combination can occur at all (the “Proposed Business Combination”).
Pursuant
to the Amendment, each Mr. Jean-Michel Doublet and Mr. Lionel Therond are to provide 25% of their working hours each week to their duties
to the Company in exchange for the following: (i) Blue Oak is to receive an increased success fee under the Original Agreement upon consummation
of the Proposed Business Combination, (ii) Mr. Jean-Michel Doublet and Mr. Lionel Therond are each to receive 0.5% of the Company’s
common stock on a fully diluted basis upon the occurrence of the Proposed Business Combination to vest 50% upon completion of the Proposed
Business Combination and 50% 6 months thereafter and (iii) Mr. Jean-Michel Doublet and Mr. Lionel Therond are each to receive additional
shares constituting 1.5% of the Company’s then fully diluted common stock to vest upon the Company’s uplisting to the OTCQB
or Nasdaq.
On
October 25, 2021, Mr. Brett Lovegrove, who has served as the sole director and officer of the Company since April 13, 2021,
resigned from all officer positions with the Company effective on the same date.
On
October 25, 2021, the Board of Directors of the Company took the following actions: (i) appointed Mr. Jean-Michel Doublet as the
Company’s Chief Executive Officer, (ii) appointed Mr. Lionel Therond as the Company’s Chief Financial Officer and (iii) appointed
Mr. Brett Lovegrove as the Chairman of the Board, all effective on the same date.
Mr.
Doublet is a beneficial owner of 60% of Blue Oak and is the Chief Executive Officer of Blue Oak. Mr. Lionel Therond is a beneficial owner
of 40% of Blue Oak and is a director at Blue Oak.
Blue
Oak is set to receive remuneration from the Company in connection with the Proposed Business Combination pursuant to the Original Agreement.
On
March 9, 2022, the Board of Directors increased the size of the Board by three (3) persons and appointed each Jean-Michel Doublet,
Lionel Therond, and Cindy Zhongye Li, as directors of the Company effective as of March 9, 2022. Mr. Therond is currently the Company’s
Chief Financial Officer, and Mr. Doublet is currently the Company’s Chief Executive Officer.
No
Current Operations and Shell Status
In
or about 2015, the Company phased out of its prior business and became a is a “shell company,” as such term is defined in
Rule 12b-2 under the Exchange Act of 1934, as amended (the “Exchange Act”). The Company is currently a shell company.
The
Company has no operations at this time, and currently does not have any principal products or services, customers or intellectual property.
As the Company has no current operations, it also currently is not subject to any competitive business conditions. Further, the Company
is not subject to any government approvals at this time, other than those applicable to it as a “shell company,” as such
term is defined in Rule 12b-2 under the Exchange Act.
Prior
Receivership
On
December 11, 2020, as a result of a receivership in the Eighth Judicial District Court in Clark County, Nevada, Case Number: A-20-816621-B,
the plaintiff creditor in the case, Custodian Ventures LLC (the “Custodian”) received an order from the Clark County Court
appointing David Lazar as the receiver of the Company. On the same date, David Lazar was appointed as the Company’s Chief Executive
Officer, President, Secretary, Chief Financial Officer, Chief Executive Officer and Chairman of the Board of Directors. On December 29,
2020, the Company’s Charter was reinstated in the State of Nevada. The receivership was terminated by the Eighth Judicial District
Court in Clark County, Nevada, under Case Number: A-20-816621-B on May 10, 2021 and on the same date, the court also discharged
Mr. Lazar as the receiver.
Results
of Operations for the three months period ended September 30, 2022 and for the three months period ended September 30, 2021
For
the three months period ended September 30, 2022 we generated $0 in revenues.
For
the three months period ended September 30, 2022 we had $178,864 of operating expenses consisting of $6,290 of legal fees and $40,600
of accounting and audit fees, $130,986 of consulting fees and $988 of general and administrative expense compared to $192,418 of consulting,
legal and accounting and audit fees during the period the three months ended September 30, 2021. The decrease is attributable to
legal and accounting fees incurred during the three months ended September 30, 2021, in order to take the Company out of its prior
receivership and for the preparation of financials and SEC reports.
At
the present time, we have not made any arrangements to raise additional cash. If we are unable to raise additional cash, we will either
have to suspend operations until we do raise the cash or cease operations entirely.
Going
Concern
The
Company was only recently released from receivership in Nevada. The Company’s financial statements have been presented on the basis
that it is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of
business. At September 30, 2022, the Company had a retained deficit of $1,003,511 and no working capital. The financial statements
do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
Liquidity
and Capital Resources
As
of September 30, 2022, and June 30, 2022 we had $154,449 and $180,079 cash on hand, respectively.
Off
Balance Sheet Arrangements
None
ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
An
Emerging Growth company, as defined on form 10 is not required to provide the information required by this item.
An
emerging growth company is also exempt from Section 404(b) of the Sarbanes-Oxley Act which requires that the registered accounting
firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures
for financial reporting. Similarly, as a Smaller Reporting Company we are exempt from Section 404(b) of the Sarbanes-Oxley Act and
our independent registered public accounting firm will not be required to formally attest to the effectiveness of our internal control
over financial reporting until such time as we cease being a Smaller Reporting Company.
As
an emerging growth company, we are exempt from Section 14A (a) and (b) of the Securities Exchange Act of 1934 which require the
shareholder approval of executive compensation and golden parachutes.
Section 107
of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B)
of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the
adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage
of the benefit of this extended transition period.
Our
financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
We would cease to be an emerging growth company upon the earliest of: • the first fiscal year after our annual gross revenues are
$1,235,000,000 or more; • the date on which we have, during the previous three-year period, issued more than $1 billion in non-convertible
debt securities; • as of the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded
$700 million as of the end of the second quarter of that fiscal year.
ITEM 4.
CONTROLS AND PROCEDURES
Laws
and regulations use controls, disclosure obligations and other restrictions that affect the property management development in the Ukraine.
Such laws and regulations tend to discourage rent and leasing activities. Transactions in which we were involved may be delayed or abandoned
as a result of these restrictions.
We
are implementing procedures to control advertising and promotions. These procedures are necessary to assure our proper representation
and include review of all advertising material and restrictions on how our clients and others can advertise using our brand.
Changes
in Internal Control Over Financial Reporting
There
have been no changes in the Company’s internal control over financial reporting identified in connection with the evaluation that
occurred during the Company’s last fiscal quarter that has materially affected, or is reasonable likely to materially affect, the
Company internal control over financial reporting.
PART
II
OTHER
INFORMATION
ITEM 1.
LEGAL PROCEEDINGS
The
Company is not currently a party to any material legal proceedings, nor is we aware of any other pending or threatened litigation that
would have a material adverse effect on our business, operating results, cash flows or financial condition should such litigation be
resolved unfavorable.
ITEM 1A.
RISK FACTORS
Because
we are classified as an Emerging Growth Company under the federal securities laws, we are not required to include risk factors in this
10Q report. The risk factors were included in our form 10.
ITEM 2
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None
ITEM 3.
DEFAULTS UPON SENIOR SECURITIES
We
have no senior securities outstanding.
ITEM 4.
MINE SAFETY DISCLOSURES
Not
Applicable.
ITEM 5.
OTHER INFORMATION
None.
ITEM 6.
EXHIBITS
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
ZHRH CORPORATION
Dated:
November 14, 2022 |
By: |
/s/
Jean-Michel Doublet |
|
|
Jean-Michel
Doublet |
|
|
Chief
Executive Officer
(principal
executive officer) |
|
|
|
Dated:
November 14, 2022 |
By: |
/s/
Lionel Therond |
|
|
Lionel
Therond |
|
|
Chief
Financial Officer
(principal
financials and accounting officer) |
ZHRH (CE) (USOTC:ZHEC)
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