U.S.
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-12G/A
Amendment
no. 3
GENERAL FORM FOR REGISTRATION OF SECURITIES
UNDER SECTION 12(B) OR (G) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission file number: 000-56016
Quick
Start Holdings, INC.
(Name of Small Business Issuer in its
charter)
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Delaware
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I.R.S. Employer Identification Number
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(State or other jurisdiction of
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83-3492907
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incorporation or formation)
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401 N. Wickham Road, Suite 130
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Melbourne, FL
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32935
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(Address of principal executive offices)
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(Zip Code)
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Issuer's telephone number: (888)-337-0468
Email: quickstartholdings@gmail.com
Securities to be registered under Section
12(b) of the Act: None
Securities to be registered under Section
12(g) of the Exchange Act:
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Title of each class
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Name of Exchange on which shares are Currently Traded
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Common Stock, $0.001
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OTC
Markets Group Inc.'s Pink® Open Market
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Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, or a non-accelerated filer or a smaller reporting company. See definition of
large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Securities Exchange Act of 1934.
Large accelerated filer [ ] Accelerated
filer [ ] Non-accelerated filer [ ] Smaller reporting company [X] Emerging growth company [X]
If an emerging growth company, indicate
by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
EXPLANATORY
NOTE
Quick Start
Holdings, Inc., a Delaware corporation (the “Company”), is filing this Registration Statement on Form 10-12G (as may
be amended from time to time, this “Registration Statement”) with the Securities and Exchange Commission (the “SEC”)
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), on a voluntary basis. In this Registration
Statement, each of the “Company,” “we,” “us,” and “our” refers to Quick Start Holdings,
Inc.
Now that this
Registration Statement is effective, we are subject to the periodic reporting requirements of the Exchange Act, including the rules
and regulations promulgated thereunder, which will require us, among other things, to file annual reports on Form 10-K, quarterly
reports on Form 10-Q, and current reports on Form 8-K, and we will be required to comply with all other obligations of the Exchange
Act applicable to issuers filing registration statements pursuant to Section 12(g) of the Exchange Act.
This Amendment
No. 3 to Form 10-12G also makes such revisions and updates necessary to continue to reflect the Company's current business intentions.
FORWARD
LOOKING STATEMENTS
There
are statements in this Registration Statement that are not historical facts. These “forward-looking statements” can
be identified by use of terminology such as “believe,” “hope,” “may,” “anticipate,”
“should,” “intend,” “plan,” “will,” “expect,” “estimate,”
“project,” “positioned,” “strategy” and similar expressions. You should be aware that these
forward-looking statements are subject to risks and uncertainties that are beyond our control. Although management believes
that the assumptions underlying the forward-looking statements included in this Registration Statement are reasonable, they do
not guarantee our future performance, and actual results could differ from those contemplated by these forward-looking statements.
The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates
of future events and are subject to uncertainty as to possible changes in economic, legislative, industry, and other circumstances.
As a result, the identification and interpretation of data, and other information, and their use in developing and selecting assumptions
from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the
outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability
of those forward-looking statements. In light of these risks and uncertainties, there can be no assurance that the results
and events contemplated by the forward-looking statements contained in this Registration Statement will in fact transpire. You
are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. We do not undertake
any obligation to update or revise any forward-looking statements.
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TABLE OF CONTENTS
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Description
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Page
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Item 1.
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Business
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3
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Item 1A.
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Risk Factors
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6
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Item 2.
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Financial Information
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6
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Item 3.
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Properties
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9
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Item 4.
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Security Ownership of Certain Beneficial Owners and Management
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9
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Item 5.
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Directors and Executive Officers
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9
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Item 6.
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Executive Compensation
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10
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Item 7.
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Certain Relationships and Related Transactions, and Director Independence
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12
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Item 8.
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Legal Proceedings
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12
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Item 9.
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Market Price of and Dividends on the Registrants Common Equity and Related Stockholder Matters
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12
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Item 10.
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Recent Sales of Unregistered Securities
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13
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Item 11.
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Description of Registrant’s Securities to be Registered
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13
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Item 12.
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Indemnification of Officers and Directors
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14
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Item 13.
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Financial Statements and Supplementary Data
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F1-F10
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Item 14.
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
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15
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Item 15.
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Exhibits
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15
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SIGNATURES
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ITEM 1. BUSINESS
Corporate History
We were incorporated on September 4,
2018 in the State of Delaware. On September 4, 2018, Paul Moody was appointed as our Chief Executive Officer, Chief Financial Officer,
and sole director.
USSE Corp. and USSE Delaware Merger
USSE Corp., a Nevada corporation (“USSE
Corp.”), was incorporated with the Nevada Secretary of State on July 8, 1998 under the original
name C&A Restaurants, Inc. (“C&A Restaurants”). On June 15, 2009, C&A Restaurants changed its name to USSE
Corp.
Effective September 19, 2018, USSE Corp.
re-domiciled from Nevada to Delaware pursuant to a merger of USSE Corp. with and into USSE Delaware, Inc., a Delaware corporation
(“USSE Delaware” or “Predecessor”), with USSE Delaware as the surviving entity (the “Re-domestication
Merger”). Each share of USSE Corp’s capital stock issued and outstanding immediately prior to the effective date of
the Re-domestication Merger was automatically converted into one fully paid and nonassessable share of USSE Delaware.
Immediately, following
the Re-domestication Merger, USSE Delaware was authorized to issue up to 1,005,000,000 shares, which consisted of:
(i) 1,000,000,000 shares of common stock, par value $0.001 per share, of which 66,397,574 shares were issued and outstanding
at such date; and (ii) 5,000,000 shares of preferred stock, par value $.001 per share, of which (a) 1,000,000 shares
were designated as Convertible Series A, all of which were issued and outstanding at that date; and (b) 500,000 shares were
designated as Convertible Series B, of which 71,700 shares of Convertible Series B preferred stock were issued and
outstanding at that date.
Holding Company Reorganization
On September 4, 2018, USSE Delaware
acquired 1,000 shares of common stock of the Company, which represented 100% of the Company’s then-outstanding shares of
common stock, for no consideration, resulting in the Company becoming a wholly-owned subsidiary of USSE Delaware. Also, immediately
prior to the Holding Company Reorganization (as defined below), USSE Merger Sub, Inc., a Delaware corporation (“USSE Merger
Sub”), was our wholly-owned subsidiary.
Effective on September 19, 2018 (the
“Effective Time”), and in accordance with the provisions set forth in Section 251(g) of the Delaware General Corporation
Law (“DGCL”), USSE Delaware, our then parent, merged with and into USSE Merger Sub, an indirect wholly-owned subsidiary
of USSE Delaware and our direct wholly-owned subsidiary, with USSE Delaware as the surviving corporation and our wholly-owned
subsidiary (the “Holding Company Reorganization”). At the Effective Time, and as a result of the Holding Company Reorganization,
the separate corporate existence of USSE Merger Sub ceased, and USSE Delaware changed its name to USSE Corp., which then became
the our wholly-owned subsidiary. The Holding Company Reorganization also resulted in the conversion of securities of USSE Delaware
into identical and equivalent securities of the Company and the stockholders of USSE Delaware became the stockholders of the Company.
Upon completion of the Holding Company
Reorganization, by virtue of the merger, and without any action on the part of the holder thereof, each share of USSE Delaware’s
common stock issued and outstanding immediately prior to the Effective Time of the Holding Company Reorganization was automatically
converted into one validly issued, fully paid, and non-assessable share of the Company’s common stock. Additionally,
each share of USSE Delaware’s preferred stock issued and outstanding immediately prior to the Effective Time was converted
into one validly issued, fully paid, and non-assessable share of the Company’s preferred stock, having the same designations,
rights, powers, and preferences, and the qualifications, limitation, and restrictions thereof, as the corresponding share of USSE
Delaware’s preferred stock.
Additionally, any shares held by the
Company in the Predecessor were cancelled. This resulted in the Company being authorized to issue up to 1,005,000,000 shares, which
consisted of: (i) 1,000,000,000 shares of common stock, par value $0.001 per share of which 66,397,574 shares were issued and outstanding;
(ii) 5,000,000 shares of preferred stock, par value $0.001 per share, of which (a) 1,000,000 shares were designated as Convertible
Series A, all of which were issued and outstanding; and (b) 500,000 shares were designated as Convertible Series B, of which 71,700
shares of Convertible Series B preferred stock were issued and outstanding.
Post-Holding Company Reorganization
On October 19, 2018, the Company issued
500,000,000 shares of restricted common stock and 400,000 shares of Convertible Series B preferred stock to GMRZ Holdings LLC,
a Nevada limited liability company (“GMRZ”), for services rendered to the Company.
Commensurate with the filing of our
Amended and Restated Certificate of Incorporation with the Delaware Secretary of State on October 22, 2018, every issued and outstanding
share of Convertible Series A preferred stock was converted into 1.25 shares of common stock with stockholders’ economic
rights preserved. Additionally, at the same time, every share of Convertible Series B preferred stock issued and outstanding was
converted into ten shares of common stock with stockholders’ economic rights adversely affected in the conversion. Immediately
following the conversion of the aforementioned shares, and upon filing of the Amended and Restated Certificate of Incorporation,
the authorized and unissued shares of Convertible Series A and Convertible Series B preferred stock were cancelled. As of October
22, 2018, the Convertible Series A and Series B preferred stock were removed from the status of authorized but unissued preferred
stock.
On February 6, 2019, the Company entered
into a non-binding Share Purchase Agreement (the “Agreement”) by and among the Company, GMRZ, and Kaival Brands Innovations
Group, LLC, a Delaware limited liability company (“KBIG”), pursuant to which, on February 20, 2019, GMRZ sold 504,000,000
shares of the Company’s restricted common stock, representing approximately 88.06 percent of the Company’s issued and
outstanding shares of common stock, to KBIG, and KBIG paid GMRZ consideration of three hundred twenty-five thousand dollars ($325,000)
(the “Purchase Price”). The consummation of the transactions contemplated by the Agreement resulted in a change in
control of the Company, with KBIG becoming the Company’s largest controlling stockholder. The sole members of KBIG are Nirajkumar
Patel and Eric Mosser. The Purchase Price was paid with personal funds of the members of KBIG.
Concurrently with the closing of the
transactions contemplated by the Agreement, on February 20, 2019, Mr. Paul Moody resigned as the Company’s Chief Executive
Officer, Chief Financial Officer, President, Secretary, Treasurer, and sole director. The resignation was not the result of any disagreement
with the Company on any matter relating to its operations, policies, or practices. On February 20, 2019, Mr. Nirajkumar
Patel was appointed as Chief Executive Officer, Chief Financial Officer, President, Treasurer, and director. There was no arrangement
or understanding among Mr. Patel and any other person pursuant to which he was appointed as a director and officer of the Company.
Also on February 20, 2019, Mr. Eric Mosser was appointed as Chief Operating Officer, Secretary, and director. There was no arrangement
or understanding among Mr. Mosser and any other person, pursuant to which he was appointed as a director and officer of the Company.
On February 19, 2019, the Company filed
with the Secretary of State of the State of Delaware a Certificate of Amendment to Amended and Restated Certificate of Incorporation
(the “Certificate of Amendment”) to clarify that the exclusive forum provision does not preclude or contract the scope
of exclusive federal or concurrent jurisdiction for suits brought to enforce any duty or liability created by the Exchange Act
or the Securities Act of 1933, as amended (the “Securities Act”), and the respective rules and regulations thereunder.
To date, the Company has been engaged
in limited organizational efforts; however, the Company intends to commence business operations in the near term. Currently, the
Company is exploring and evaluating various business opportunities, which may include entering into distribution or other contractual
arrangements, or acquiring the assets of an existing company. As of the date of this Registration Statement, the Company has not
entered into any agreements concerning any business activities.
The Company is an “emerging growth
company” (“EGC”), that is exempt from certain financial disclosure and governance requirements for up to five
years as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), that eases restrictions on the
sale of securities, and increases the number of stockholders a company must have before becoming subject to the SEC’s reporting
and disclosure rules. For additional information, see the “Emerging Growth Company” section below.
Business
General
The Company, based on current and
proposed business activities, is a "blank check" company. The SEC defines a "blank check" company as "any development stage company
that is issuing a penny stock, within the meaning of Section 3(a)(51)-1 of the Exchange Act, and that has no specific business
plan or purpose, or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company
or companies or other entity or person." Pursuant to Rule 12b-2 promulgated under the Exchange Act, the Company also qualifies
as a shell company, because it has no or nominal assets (other than cash) and no or nominal operations. In addition, many states
have enacted statutes, rules, and regulations limiting the sale of securities of "blank check" companies in their respective jurisdictions.
The Company's current business plan
is the exploration and evaluation of various business opportunities that would help us grow and cease to be a shell company. The
Company's principal business objective for the next 12-month period and beyond such time will be to achieve long-term growth potential
through a combination with a business, acquisition of assets, or commencement of business operations, rather than immediate, short-term
earnings. The Company is currently exploring potential business opportunities within the electronic cigarettes and vaporizers
and CBD industries as a result of our management's current and prior business experience within such industries. As of the date
of this Registration Statement, the Company has not entered into any definitive agreement with any party; however, the Company
has engaged in preliminary discussions with various parties regarding potential business opportunities for the Company.
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The analysis of new business opportunities
will be undertaken by, or under the supervision of, Nirajkumar Patel and Eric Mosser, the Company’s officers and directors.
The Company has unrestricted flexibility in seeking, analyzing, and participating in potential business opportunities. The Company
may merge with, acquire, or otherwise do business with another company in which the Company’s promoters, management, or
promoters’ or managements’ affiliates or associates, directly or indirectly, have an ownership interest. In its efforts
to analyze potential business opportunities, the Company will consider the following kinds of factors:
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(a)
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Potential
for growth, indicated by new technology, anticipated market expansion or new products;
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(b)
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Capital
requirements and anticipated availability of required funds, to be provided by the Company or from operations, through the
sale of additional securities, through joint ventures or similar arrangements or from other sources;
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(c)
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The
cost of participation by the Company as compared to the perceived tangible and intangible values and potentials;
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(d)
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The
extent to which the business opportunity can be advanced;
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(e)
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The
accessibility of required management expertise, personnel, raw materials, services, professional assistance, and other required
items; and
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(f)
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Other
relevant factors.
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In applying the foregoing criteria,
none of which will be controlling, management will attempt to analyze all factors and circumstances and make a determination
based upon reasonable investigative measures and available data. Potentially available business opportunities may occur in many
different industries, and at various stages of development, all of which will make the task of comparative investigation and analysis
of such business opportunities extremely difficult and complex. Due to the Company’s limited capital available for investigation,
the Company may not discover or adequately evaluate adverse facts about the opportunity.
Our Common Stock
Market
For Our Common Stock
The Company’s common stock
is quoted on the OTC Markets Group Inc.’s Pink® Open Market (the “OTC Pink”) under the symbol “QSHI.”
There is currently a limited trading market in the Company’s shares of common stock. There can be no assurance that an active
trading market for our securities will develop and, if an active trading market develops, that it will continue. In the event
that an active trading market develops and continues, there can be no assurance as to the market price of our shares of common
stock, whether any trading market will provide liquidity to investors, or whether any trading market will be sustained.
Rule 144
Shares of our common stock cannot be
sold under the exemptions from registration provided by Rule 144 promulgated under the Securities Act or Section 4(a)(1) of the
Securities Act so long as we are designated as a "shell company" and for 12 months after we cease to be a "shell company." After
the 12-month period following the date we cease to be a shell company, we may rely on exemptions from registration if we are otherwise
in compliance with the applicable rules and regulations. Compliance with the criteria for securing exemptions under federal securities
laws and the securities laws of the various states is extremely complex, especially in respect of those exemptions affording flexibility
and the elimination of trading restrictions in respect of securities received in exempt transactions and subsequently disposed
of without registration under the Securities Act or state securities laws.
Rule 419
If we engage in a registered offering
of the issuance and sale of our securities as a blank check company or with a company that would still be considered a shell company
or blank check company, the offering would be subject to Rule 419 promulgated under the Securities Act. Pursuant to Rule 419,
a "blank check company" is a development stage company, that is offering penny stock, as defined by Rule 3a51-1 of the Exchange
Act, and that has no specific business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition
with an unidentified company or companies. Should we file a registration statement related to a public offering of our securities
and we qualify as a blank check company pursuant to applicable rules and regulations of the SEC, we would be subject to the following:
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(a)
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Deposit and investment of proceeds
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All offering proceeds, after deduction
of cash paid for underwriting commissions, underwriting expenses, and dealer allowances, and amounts permitted to be released to
the registrant shall be deposited promptly into the escrow or trust account;
provided
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however
, that no deduction
may be made for underwriting commissions, underwriting expenses, or dealer allowances payable to an affiliate of the registrant.
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(b)
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Deposit of securities
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All securities issued in connection
with the offering, whether or not for cash consideration, and any other securities issued with respect to such securities, including
securities issued with respect to stock splits, stock dividends, or similar rights, shall be deposited directly into an escrow
or trust account promptly upon issuance. The identity of the purchaser of the securities shall be included on the stock certificates
or other documents evidencing such securities.
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(c)
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Release of deposited and funds securities
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Upon execution of an agreement(s) for
the acquisition(s) of a business(es) or assets that will constitute the business (or a line of business) of the registrant and
for which the fair value of the business(es) or net assets to be acquired represents at least 80 percent of the maximum offering
proceeds, including proceeds received or to be received upon the exercise or conversion of any securities offered, but excluding
amounts payable to non-affiliates for underwriting commissions, underwriting expenses, and dealer allowances, the registrant must
file a post-effective amendment disclosing the entire transaction.
Furthermore, if we publicly offer any
securities as a condition to the closing of any acquisition or business combination while we are a blank check or shell company,
we will have to fully comply with Rule 419 under the Securities Act and deposit all funds in escrow pending disclosure of all the
information related to the proposed transaction to our stockholders, as required by Regulation 14 promulgated by the SEC, and seek
the vote and approval of those stockholders to whom such securities were offered; if no response is received from these stockholders
within 45 days thereafter or if any stockholder elects not to invest following our disclosure of the proposed transaction, all
funds that must be held in escrow by us under Rule 419 under the Securities Act, as applicable, will be promptly returned to any
such stockholder. All securities issued in any such offering will likewise be deposited in escrow, pending satisfaction of the
foregoing conditions. In addition, if we enter into a transaction with a company that would still be considered a shell company
or blank check company, the exemption from registration available from Rule 144, for the resales of our securities by our stockholders,
would not be available to us.
Mr. Patel and Mr. Mosser, the Company's
officers and directors, and indirect controlling stockholders of the Company through their ownership in KBIG, currently have no
intentions of engaging in any transactions with respect to the Company's common stock. However, if the Company effects any such
transactions in our common stock, we will comply with the applicable registration requirements of the Securities Act.
Blue-Sky Laws
In addition, the ability to register or qualify for sale any shares of common stock for both initial sales and resales may
be limited because a number of states have enacted regulations pursuant to their securities or "blue-sky" laws restricting
or, in some instances, prohibiting, the sale of securities of "blank check" issuers, such as the Company, within that state.
In addition, many states, while not specifically prohibiting or restricting "blank check" companies, may not register the
shares for sale in their states. Because of such regulations and other restrictions, the Company's selling efforts, if any,
and any secondary market which may develop, may only be conducted in those jurisdictions where an applicable exemption is
available or a blue-sky application has been filed and accepted or where the shares have been registered; thus, our ability
to complete such an offering may be limited.
Form of Business Opportunity
General
The manner in which the Company
participates in a business opportunity will depend upon the nature of the opportunity, the respective needs and desires of the
Company and the promoters of the opportunity, and the relative negotiating strength of the Company and such promoters.
We may acquire our participation
in a business opportunity through the issuance of our common stock or other securities of the Company. If we issue shares of common
stock or securities convertible into shares of common stock, it would result in dilution to our then-existing stockholders, which
could be significant.
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Alternatively, we may acquire our
participation in a business opportunity through the consummation of an acquisition or merger. Prior to consummating any acquisition
or merger, we may be required by relevant state laws and regulations to have the transaction approved by a majority of our stockholders.
If we were required to obtain stockholder approval, Delaware law and our Restated Certificate of Incorporation permits certain
actions that would routinely be taken at a meeting of stockholders to be taken by written consent of the stockholders having not
less than the minimum number of votes that would be necessary to authorize or take the action at a meeting of stockholders. Thus,
if stockholders holding a majority of the then-outstanding shares decide by written consent to consummate an acquisition or a
merger, minority stockholders would not be given the opportunity to vote on the issue. If stockholder approval is required, our
Board of Directors (the “Board”) will have discretion to consummate the transaction by written consent if it is determined
to be in our best interest to do so. Regardless of whether an acquisition or merger is approved by Board action alone, by written
consent or by holding a stockholders' meeting, we are required to provide to our stockholders complete disclosure documentation
concerning the potential target including requisite financial statements. Further, if our stockholders are entitled to vote on
an acquisition or merger, we would be required to disseminate this information in a proxy statement in the event a stockholders'
meeting is held, or in an information statement if the stockholders approve such action by written consent.
The analysis of all new business
opportunities will be undertaken by or under the supervision of Nirajkumar Patel and Eric Mosser, our officers and directors,
who are not professional business analysts. The inexperience of Mr. Patel and Mr. Mosser and the fact that the analysis and evaluation
of a potential business combination or opportunity is to be taken under their supervision may adversely impact our ability to
identify and consummate a successful business combination or opportunity. There is no guarantee that Mr. Patel and Mr. Mosser
will be able to identify a business combination target or other business opportunity that is suitable for us. Mr. Patel and Mr.
Mosser may hire third parties to conduct an analysis for a target company or any other business opportunities.
Fees and Expenses
It is anticipated that the investigation
of specific business opportunities and the negotiation, drafting, and execution of relevant agreements, disclosure documents,
and other instruments will require substantial management time and attention and substantial cost for accountants, attorneys,
and others. We estimate such fees and expenses could be $15,000, or more. If a decision is made not to participate in a specific
business opportunity, the costs incurred in the related due diligence might not be recoverable. Furthermore, even if an agreement
is reached for the participation in a specific business opportunity, the failure to consummate that transaction may result in
the loss to the Company of the related costs incurred.
Furthermore, we have limited capital
resources and will likely need to raise capital in the future. We anticipate difficulty in obtaining financing since we have no
income and zero cash reserves. We are presently reliant on capital contributions towards expenses from our officers and directors,
Nirajkumar Patel and Eric Mosser. Our officers and directors have not guaranteed that they will continue to support our capital
needs. Therefore, we may not have the ability to continue as a going concern.
Employees
We presently have no employees apart
from our management, which consists of two individuals, our officers and directors, Mr. Nirajkumar Patel and Mr. Eric Mosser.
Our officers and directors are engaged in outside business activities and anticipates that they will devote to our business approximately
five (5) hours per week until the acquisition of a successful business opportunity has been identified, or we otherwise commence
business operations. We expect no significant changes in the number of our employees other than such changes, if any, incident
to a business combination or commencement of business operations.
Reports to Security Holders
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(1)
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The
Company is not required to deliver an annual report to security holders and at this time does not anticipate the distribution
of such a report.
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(2)
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The
Company will file periodic reports with the SEC. The Company is a reporting company and intends to comply with the requirements
of the Exchange Act.
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(3)
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We
will file annual, quarterly, and current reports, proxy statements, and other information with the SEC. The SEC maintains
an Internet site that contains reports, proxy and information statements, and other information that we file electronically
with the SEC. Our filings are available free of charge at the SEC’s website at http://www.sec.gov.
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-5-
Emerging G
rowth
Company
We are an emerging growth company under
the JOBS Act. We shall continue to be deemed an emerging growth company until the earliest of:
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(a) the last day of our fiscal year during which we had total annual gross revenues of $1,070,000,000 (as such amount is indexed for inflation every 5 years by the SEC to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more;
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(b) the last day of our fiscal year following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective initial public offering registration statement;
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(c) the date on which we had, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or
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(d) the date on which we are deemed to be a large accelerated filer, as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto.
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As an emerging growth company, we are
exempt from Section 404(b) of Sarbanes Oxley Act of 2002 (“Sarbanes Oxley”). Section 404(a) of Sarbanes Oxley requires
issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and
procedures for financial reporting. Issuers must also state its assessment of the effectiveness of such internal controls and procedures.
Section 404(b) of Sarbanes Oxley requires that the issuer’s independent registered public accounting firm must, in the same
report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial
reporting.
As an emerging growth company, we are
also exempt from Sections 14A (a) and (b) of the Exchange Act, which require stockholder approval of executive compensation and
golden parachutes.
We have elected to use the extended
transition period for complying with new or revised accounting standards under Section 102(b)(2) of the Jobs Act, which allows
us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies
until those standards apply to private companies. As a result of this election, our financial statements may not be comparable
to companies that comply with public company effective dates.
ITEM 1A. RISK FACTORS
The Company qualifies as a smaller reporting
company, as defined by Section 229.10(f)(1) of Regulation S-K and, thus, is not required to provide the information required by
this Item.
ITEM
2. FINANCIAL INFORMATION
Selected Financial Data
The Company qualifies as a smaller reporting
company, as defined by Section 229.10(f)(1) of Regulation S-K and, thus, is not required to provide the information required by
this Item.
Management’s Discussion and Analysis of Financial
Condition and Results of Operations
We are currently exploring and evaluating
business opportunities, which may include entering into distribution or other contractual arrangements or acquiring the assets
of an existing company. Our principal business objective for the next 12 months and beyond such time will be to achieve long-term
growth potential through a combination with a business or commencement of business operations, rather than immediate, short-term
earnings. We anticipate exploring potential business opportunities within the electronic cigarettes and vaporizers and CBD
industries as a result of our management’s prior and current business experience within such industries. Management envisions
that such business opportunities would result in us commencing business operations without having to otherwise consummate a business
combination. We have not entered into any definitive agreements with any party; however, we have engaged in discussions with various
parties regarding potential business opportunities.
In the event that management is
unable to otherwise commence business operations, and determines that it is necessary to engage in one or more business combinations,
we may consider a business that has recently commenced operations, is in need of additional funds for expansion into new products
or markets, is seeking to develop a new product or service, or is an established business that may be experiencing financial or
operating difficulties and is in need of additional capital. Our management believes that the public company status that results
from a combination with us could provide such company greater access to the capital markets, increase its visibility in the investment
community, and offer the opportunity to utilize its stock to make acquisitions. However, there is no assurance that we will have
greater access to capital due to our public company status and, therefore, a business combination with an operating company in
need of additional capital may expose us to additional risks and challenges. In the alternative, a business combination may involve
the acquisition of, or merger with, a company which does not need substantial additional capital, but which desires to establish
a public trading market for its shares, while avoiding, among other things, the time delays, significant expense, and loss of
voting control that may occur in a public offering. We do not anticipate paying a finder’s fee, either in cash or through
the issuance of securities, for the consummation of any business acquisition the Company makes pursuant to its current business
plan.
Any target business that is selected
may be a financially unstable company or an entity in its early stages of development or growth, including entities without established
records of sales or earnings. In that event, we will be subject to numerous risks inherent in the business and operations of financially
unstable and early stage or potential emerging growth companies. In addition, we may commence business opportunities or combine
with an entity in an industry characterized by a high level of risk, and, although our management will endeavor to evaluate the
risks inherent in a particular target business, there can be no assurance that we will properly ascertain or assess all significant
risks.
Current economic and financial conditions
are volatile may affect the selection of a business combination or other business opportunities, which would adversely affect
our ability to effect our goals. Business and consumer concerns over the economy, geopolitical issues, the availability and cost
of credit, the U.S. financial markets, and the national debt have contributed to this volatility. These factors, combined with
declining and failing businesses, reduced consumer confidence and increased unemployment, have caused a global slowdown. We cannot
accurately predict how long these current economic conditions will persist, whether the economy will deteriorate, and how we will
be affected.
We intend to search for business
opportunities by contacting various sources including, but not limited to, our affiliates, lenders, investment banking firms,
private equity funds, financial advisors and similar persons, accounting firms, and attorneys notwithstanding us contacting any
business directly. The approximate number of persons or entities that will be contacted is unknown and dependent on whether any
opportunities are presented by the sources that we contact. However, there is no assurance that we will identify any viable business
opportunities.
The risks we may face if we are
unable to commence business operations, if such business operations are unsuccessful, if we are unable to acquire or merger with
another entity, or if such acquisition or merger is unsuccessful, include, but are not limited to, difficulty in achieving future
financing, continuing operations, bankruptcy, litigation, and increasing business operations on a limited or no budget.
-6-
We do not currently engage in any
business activities that provide cash flow. The costs of investigating and analyzing business combinations and opportunities for
the next 12 months and beyond such time will be paid with money in our treasury, if any, or with additional amounts, as necessary,
to be loaned to or invested in us by our stockholders, management, or other investors. At this time, we are entirely reliant upon
cash contributions made by our officers and directors to pay for any and all expenses.
During the next 12 months we anticipate
incurring costs related to the filing of Exchange Act reports (legal, accounting, and auditing fees) in the amount of approximately
between $5,000 and $10,000. If we pursue any mergers or acquisitions, we anticipate incurring expenses of approximately between
$10,000 and $20,000, or more, to pay for legal fees and audit fees. We believe we will be able to meet the costs of filing Exchange
Act reports during the next 12 months through use of funds to be loaned to or invested in us by Mr. Nirajkumar Patel and Mr. Eric
Mosser, our officers and directors, or other stockholders. However, there is no guarantee that such additional funds will be made
available to us or on terms that are favorable to us. If we enter into a business combination with a target entity, we will attempt
to require the target company to pay the acquisition related fees and expenses as a condition precedent to such an agreement.
To date, we have had no discussions
with our officers and directors, Mr. Nirajkumar Patel and Mr. Eric Mosser, or other investors, regarding funding and no funding
commitment for future expenses has been obtained. If in the future we need funds to pay expenses, we will consider these and other
yet to be identified options for raising funds and/or paying expenses. Obviously, if Mr. Patel, Mr. Mosser, or other investors
do not loan to or invest sufficient funds in us, then we will not be able to meet our SEC reporting obligations
We have negative working capital,
a stockholder deficit, and have no source of revenues. These conditions raise substantial doubt about our ability to continue
as a going concern. For the foreseeable future, we will be devoting our efforts to exploring and evaluating business opportunities,
which may include merger or acquisition candidates. Our ability to continue as a going concern is dependent upon our ability to
develop additional sources of capital, locate and complete a merger with another company or otherwise commence business operations,
and ultimately, achieve profitable operations.
-7-
We are an EGC that is exempt from
certain financial disclosure and governance requirements for up to five years as defined in the JOBS Act, that eases restrictions
on the sale of securities; and increases the number of stockholders a company must have before becoming subject to the SEC’s
reporting and disclosure rules. For additional information, please see the Emerging Growth Company section above. We have elected
to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the Jobs
Act, that allows us to delay the adoption of new or revised accounting standards that have different effective dates for public
and private companies until those standards apply to private companies. As a result of this election, our financial statements
may not be comparable to companies that comply with public company effective dates.
Liquidity
We have no known demands or commitments
and are not aware of any events or uncertainties as of October 31, 2018 that will result in or that are reasonably likely to materially
increase or decrease our current liquidity.
Capital Resources.
We had no material commitments for capital
expenditures as of October 31, 2018.
Off Balance Sheet Arrangements.
We do not have any off-balance sheet arrangements
that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition,
revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that is material to investors.
-8-
ITEM 3. PROPERTIES
We currently neither rent nor own any
properties. We currently have no policy with respect to investments or interests in real estate, real estate mortgages or securities
of, or interests in, persons primarily engaged in real estate activities. We currently utilize the home office space and equipment
of our management at no cost.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
(a) Security ownership of certain beneficial owners.
The following table sets forth, as of
the date of this Registration Statement, the number of shares of Common Stock owned of record and beneficially by executive officers,
directors, and persons who beneficially own more than 5% of the outstanding shares of our Common Stock. Beneficial ownership has
been determined in accordance with the rules and regulations of the SEC and includes voting or investment power with respect to
shares. Unless otherwise indicated, the persons named in the table have sole voting and investment power with respect to the number
of shares indicated as beneficial owned by them.
Name and Address
|
|
Amount and Nature of
Beneficial Ownership (Common Stock)
(1)
|
|
Percentage
of Class (1)
|
|
|
|
|
|
Paul Moody (2)
780 Reservoir Avenue, #123
Cranston, RI 02910
|
|
0
|
|
0%
|
|
|
|
|
|
|
|
Nirajkumar Patel (3)
401 N. Wickham Road, Suite 130
Melbourne, FL 32935
|
|
504,000,000 (4)
|
|
88.06%
|
|
|
|
|
|
|
|
Eric Mosser (5)
401 N. Wickham Road, Suite 130
Melbourne, FL 32935
|
|
504,000,000 (6)
|
|
88.06%
|
|
|
|
|
|
|
|
Executive Officers and Directors as a Group (3 persons)
|
|
504,000,000
|
|
88.06%
|
|
|
|
|
|
|
|
Kaival Brands Innovations
Group, LLC (7)
401 N. Wickham Road, Suite 130
Melbourne, FL 32935
|
|
504,000,000
|
|
88.06%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_________________________________________
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Applicable percentage
of ownership is based on 572,364,574 shares of common stock outstanding as of April 17, 2019. 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 common stock that are currently exercisable within 60 days of April 17, 2019 are deemed to be
beneficially owned by the person holding such securities for the purpose of computing the percentage of ownership of such
person, but are not treated as outstanding for the purpose of computing the percentage ownership of any person.
(2) Paul Moody formerly served as Chief
Executive Officer, Chief Financial Officer, President, Secretary, Treasurer and the sole director of the Company.
(3) Nirajkumar Patel serves as Chief
Executive Officer, Chief Financial Officer, President, Treasurer and a director of the Company.
(4) Consists of 504,000,000 shares of
our common stock held by KBIG, an entity over which Mr. Patel has shared dispositive and voting authority.
(5) Eric Mosser serves as Chief Operating Officer, Treasurer
and a director of the Company.
(6) Consists of 504,000,000 shares of
our common stock held by KBIG, an entity over which Mr. Mosser has shared dispositive and voting authority.
(7) Nirajkumar Patel and Eric Mosser
are the sole members of KBIG.
*We have no shares of preferred stock issued and outstanding
as of the date of this Registration Statement.
ITEM 5. DIRECTORS AND EXECUTIVE OFFICERS
Identification of Directors and Executive
Officers
Our current officers and directors and
additional information concerning them are as follows:
|
|
|
|
|
Name
|
|
Age
|
|
Position(s)
|
|
|
|
|
|
Nirajkumar Patel
|
|
35
|
|
Chief Executive Officer, Chief Financial Officer, President, Treasurer, and a director
|
|
|
|
|
|
Eric Mosser
|
|
40
|
|
Chief Operating Officer, Secretary, and a director
|
|
|
|
|
|
Nirajkumar Patel, Chief Executive
Officer, Chief Financial Officer, President, Treasurer, and a Director
Mr. Nirajkumar Patel, age 35, attended
AISSMS College of Pharmacy in Pune, India and received a Bachelor of Science Degree in Pharmacy in 2004. After moving to the United
States in 2005, Mr. Patel became a United States citizen in 2008 and obtained a Master’s Degree in Chemistry from the Florida
Institute of Technology in 2009. Mr. Patel is an IASSC Certified Lean Six Sigma Black Belt professional, which certification he
obtained in 2010, and is a prominent local businessman in Brevard County, Florida. In 2017 and 2018, Mr. Patel served as Vice President
for the Board of the Indian Association of the Space Coast, located in Brevard County, Florida. Mr. Patel founded, and has served
as a Board member of, the Florida Independent Liquor Stores Owners Association since 2017. In 2013, Mr. Patel launched Just Chill
Products LLC, a highly successful developer/manufacturer of high-end CBD products, and has served as its Chief Executive Officer
and Chief Science Officer since 2017. In 2017, Mr. Patel created Relax Lab Inc., a producer/manufacturer of a CBD relaxation beverage,
and currently serves as its Chief Executive Officer and Chief Science Officer. In 2017, Mr. Patel also created RLX Lab LLC, a producer/manufacturer
of a non-CBD relaxation beverage, and currently serves as its Chief Executive Officer and Chief Science Officer. In 2017, Mr. Patel
also founded KC Innovations Lab Inc., a CBD white-label manufacturing service and developer/producer of best-selling white-label
CBD products including cosmetics, edibles, beverages, topicals, and vape oils, and currently serves as its Chief Executive Officer
and Chief Science Officer. There was no arrangement or understanding among Mr. Patel and any other person pursuant to which he
was appointed as a director and officer of the Company.
Eric Mosser, Chief Operating Officer, Secretary, and a Director
Mr. Eric Mosser, age 40, attended Arizona
State University and studied Business Management and then graduated from Rio Salado College with an Associate’s Degree in
Applied Science in Computer Technology in 2004. With extensive previous corporate work history in Information Technology, Mr. Mosser
recently worked from 2012 to 2014 as Director of Information Technology at Timbercon Inc., a fiber-optic design company and ITAR
manufacturing facility in Oregon. In 2014, Mr. Mosser created Lasermycig LLC, a specialized custom laser-engraving service for
electronic cigarettes and vaporizers and currently serves as its Chief Executive Officer. Upon meeting Mr. Nirajkumar Patel in
2015, Mr. Mosser immediately founded Chillcorp LTD., a full-service corporation dedicated solely to the complete internal and external
operations of Just Chill Products LLC, Relax Lab Inc., RLX Lab LLC, and KC Innovations Lab INC., and currently serves as its Chief
Executive Officer. There was no arrangement or understanding among Mr. Mosser and any other person pursuant to which he was appointed
as a director and officer of the Company.
-9-
Significant Employees
None.
Family Relationships
None.
Involvement in Certain Legal Proceedings
There have been no events under any
bankruptcy act, no criminal proceedings and no judgments, injunctions, orders or decrees material to the evaluation of the ability
and integrity of any director, executive officer, promoter, or control person of the Company during the past ten years.
Board of Directors
Currently, the Company’s Board
has two members. At this time, the Board has no separate committees. Thus, the entire Board acts as the Audit Committee. Neither
Board member qualifies as an “audit committee financial expert.” The Company has not been able to identify a qualified
candidate. Further, the Company believes that it has inadequate financial resources at this time to compensate an additional director.
The Company intends to search for an individual whom qualifies as an “audit committee financial expert” that can serve
as a director of the Company.
Prior and Current Shell Company Experience
of Former Management and Former Majority Stockholder
Paul Moody
The information in the table below summarizes
all of the blank check and shell companies, which filed a registration statement on Form 10-12G, with which Mr. Paul Moody, has
served, or currently serves, as an officer within the past five years. This also includes any public blank check or shell companies
in which Mr. Moody has held a controlling interest of during the past five years. Mr. Paul Moody previously served as our Chief
Executive Officer, Chief Financial Officer, President, Secretary, Treasurer, and sole director.
Name
|
|
Relationship with Issuer
|
Filing Date Registration Statement
(Form 10-12G)
|
Business Combination(s)
|
Date of Business Combination(s)
|
Consideration Paid
|
Fast Lane Holdings, Inc., a Delaware Company
|
|
Sole Officer and Director
|
1/25/19
|
n/a
|
n/a
|
n/a
|
The information in the table below summarizes
all of the blank check and shell companies, which filed a registration statement on Form 1-A, with which Mr. Paul Moody has served,
or currently serves, as an officer within the past five years. This also includes any public blank check or shell companies in
which Mr. Moody has held the controlling interest of during the past five years.
Name
|
|
Relationship with Issuer
|
Filing Date Registration Statement
(Form 1-A)
|
Business Combination(s)
|
Date of Business Combination(s)
|
Consideration Paid
|
Sigmata Electronics, Inc., a Delaware Company
|
|
Chief Executive Officer, President, Director
|
5/24/16
|
n/a
|
n/a
|
n/a
|
Jeffrey DeNunzio
The information in the table below summarizes
all of the blank check and shell companies, which filed a registration statement on Form 10-12G, with which Mr. Jeffrey DeNunzio
has served, or currently serves, as an officer within the past five years. This also includes any public blank check or shell companies
in which Mr. DeNunzio has held the controlling interest of during the past five years. Through GMRZ, Mr. DeNunzio previously was
our largest controlling stockholder.
Name
|
|
Relationship with Issuer
|
Filing Date Registration Statement
(Form 10-12G)
|
Business Combination(s)
|
Date of Business Combination(s)
|
Consideration Paid
|
iHealthcare, Inc., formerly known as Opulent Acquisition, Inc., a Delaware Company
|
|
Former Sole Officer, Director, and controlling shareholder.
|
2/19/15
|
Share Exchange Agreement was executed between Mr. Jeffrey DeNunzio and iHealthcare, Inc., a Florida Company
|
1/11/16
|
$25,000
|
|
|
|
|
|
|
|
Fast Lane Holdings, Inc., a Delaware Company
|
|
Indirect controlling shareholder
|
1/25/19
|
n/a
|
n/a
|
n/a
|
|
|
|
|
|
|
|
Toa Carbon Fiber, Inc., formerly known as Wealth Acquisition, Inc., a Delaware Company
|
|
Former Sole Officer, Director, and controlling shareholder.
|
8/22/13
|
Share Exchange Agreement was executed between Mr. Jeffrey DeNunzio and Hajime Abe
|
7/6/2014
|
$31,900
|
The information in the table below summarizes
all of the blank check and shell companies, which did not file a registration statement on Form 10-12G, during the time of which
Jeffrey DeNunzio was affiliated with such company.
Name
|
|
Relationship with Issuer
|
Business Combination(s)
|
Date of Business Combination(s)
|
Consideration Paid
|
Stemcell Holdings, Inc., formerly known as Perfect Acquisition, Inc., a Delaware Company
|
|
Former Sole Officer, Director, and controlling shareholder.
|
Share Exchange Agreement was executed between Mr. Jeffrey DeNunzio and Dr. Takaaki Matsuoka
|
1/27/16
|
$30,000
|
Please note that commensurate with the
date of each of the above business combinations, Jeffrey DeNunzio was no longer deemed to be a promoter, or an affiliate in any
capacity, of the above blank check and shell companies. Commensurate with the completion of each of the above business combinations,
Jeffrey DeNunzio no longer retained any equity interests in any of the aforementioned companies. Commensurate with the date of
each of the above business combinations, Jeffrey DeNunzio no longer retained positions as an officer, director, or employee, or
in any capacity, with the aforementioned companies.
The information in the table below
summarizes all of the blank check and shell companies, which filed a registration statement on Form 1-A, with which Mr. Jeffrey
DeNunzio has served, or currently serves, as an officer within the past five years. This also includes any public blank check or
shell companies in which Mr. DeNunzio has held the controlling interest of during the past five years.
Name
|
|
Relationship with Issuer
|
Filing Date Registration Statement (1-A)
|
Business Combination(s)
|
Date of Business Combination(s)
|
Consideration Paid
|
Sigmata Electronics, Inc., a Delaware Company
|
|
Chief Financial Officer, Chief Accounting Officer, Director
|
5/24/16
|
n/a
|
n/a
|
n/a
|
Other Public Company Experience
In addition to the blank check
and shell company experience outlined above, the information below summarizes certain information related to Flagship Global Corp.,
formerly known as NL One Corp. (“NL One”), for which a registration statement on Form S-1 was filed, and which Mr.
Paul Moody and Mr. Jeffrey DeNunzio previously served as an officer or director during the past five years. This information is
being provided because NL One may qualify as a shell company pursuant to the SEC’s rules and regulations. Mr. Paul Moody
previously served as our Chief Executive Officer, Chief Financial Officer, President, Secretary, Treasurer, and sole director.
Through GMRZ, Mr. DeNunzio previously was our largest controlling stockholder.
Name
|
|
Relationship
with Issuer
|
Filing Date Registration
Statement
(Form S-1)
|
Business
Combination(s)
|
Date
of Business Combination(s)
|
Consideration
Paid
|
Flagship
Global Corp, formerly known as NL One Corp., a Nevada company
|
|
Mr. DeNunzio –
Chief Executive Officer,
President, Director
Mr. Moody –
Secretary
|
9/3/14
|
n/a
|
n/a
|
n/a
|
From the period beginning on
April 29, 2014 through May 16, 2016 (the “Relevant Period”), Mr. DeNunzio served as NL One’s Chief Executive
Officer, President, and a director and Mr. Moody served as NL One’s Secretary. On May 16, 2016, NL One’s controlling
stockholder sold its controlling interest in NL One to Stansbridge Limited (“Stansbridge”) for $345,000. Neither Mr.
Moody nor Mr. DeNunzio received any compensation in connection with this sale. Since May 16, 2016, the date on which both Mr.
Moody and Mr. DeNunzio resigned from their respective positions, neither have been affiliated with NL One. Furthermore, Mr. Moody
and Mr. DeNunzio have never been controlling stockholders of NL One; however, Mr. Moody and Mr. DeNunzio each own 1,000 shares
of NL One.
Mr. Moody and Mr. DeNunzio advised
us that they do not believe that NL One constituted a shell company during the Relevant Period. Mr. Moody and Mr. DeNunzio based
their conclusion on the definition of “shell company” in Rule 12b-2 promulgated under the Exchange Act (“Rule
12b-2”). Rule 12b-2 defines a “shell company” to mean a registrant, other than an asset-backed issuer, that
has: (1) no or nominal operations; and (2) either, (i) no or nominal assets, (ii) assets consisting solely of cash and cash equivalents,
or (iii) assets consisting of any amount of cash and cash equivalents and nominal other assets. Furthermore, because the SEC intentionally
did not define the term “nominal” for purposes of Rule 12b-2, and elected to not adopt any quantitative thresholds,
Mr. Moody and Mr. DeNunzio contend that the determination of what constitutes “nominal” is largely subjective and
is based on the facts and circumstances. Mr. Moody and Mr. DeNunzio advised us that during the Relevant Period, NL One was considered
a start-up stage company, focused on the business of developing electronic, fiber optic, and information technologies. Furthermore,
during the Relevant Period, NL One owned the rights to two patent pending technologies for healthcare monitoring devices, which,
according to NL One’s then-management, held intrinsic value and were considered to be an asset. During the Relevant Period,
on March 20, 2015, these provisional patent applications were refiled. Mr. Moody and Mr. DeNunzio also actively explored other
patent acquisitions with the intention to enter into licensing and sublicensing agreements with vendors and manufacturers. NL
One also researched and explored the possibility of filing utility patents for NL One’s existing provisional patents; however,
these plans did not materialize during the Relevant Period. Accordingly, Mr. Moody and Mr. DeNunzio maintain that NL One did not
constitute a shell company during the Relevant Period because it conducted more than nominal operations and owned assets, namely
the two provisional patents.
Despite Mr. Moody’s and Mr.
DeNunzio’s assertions, in reviewing NL One’s financial statements during the Relevant Period, we believe that the
SEC may view NL One as a shell company because it had no assets reported on its balance sheet and, based on its periodic filings,
may not have commenced operations. Thus, to err on the side of caution, we have included the relevant information based on the
assumption that NL One was a shell company during the Relevant Period.
Prior and Current Shell Company Experience of Current
Management
Nirajkumar Patel
None
Eric Mosser
None
ITEM 6.
E
XECUTIVE COMPENSATION
The following table shows for the period
from inception to October 31, 2018, the end of our most recently completed fiscal year, the compensation awarded, earned, or paid
by us to our named executive officers or acting in a similar capacity as that term is defined in Item 402(a)(2) of Regulation S-K.
There are no understandings or agreements regarding compensation that our management will receive after a business combination
that is required to be included in this table, or otherwise.
SUMMARY COMPENSATION TABLE
Name
and
principal
position
|
|
Fiscal Year
|
|
Salary
($)
|
|
|
Bonus
($)
|
|
|
Stock
Awards
($)
|
|
|
Option
Awards
($)
|
|
Non-Equity
Incentive
Plan
Compensation
($)
|
|
Nonqualified
Deferred
Compensation
Earnings ($)
|
|
All
Other
Compensation
($)
|
|
Total
($)
|
|
Paul Moody, Former President, CEO, and CFO
|
|
|
|
|
|
October 31, 2018
|
|
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding Equity Awards at Fiscal Year-End
The Company had no outstanding equity awards as of October
31, 2018, its fiscal year-end.
Compensation of Directors
The Company did not compensate its sole director, Paul Moody,
during fiscal 2018.
-10-
ITEM 7. CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Related Party Transactions
Other than the transactions described
below, since September 4, 2018, the date of our incorporation, there has not been, nor is there currently proposed, any transaction
or series of similar transactions to which we were or will be a party:
|
·
|
In which the amount involved exceeds the lesser of $120,000 or one percent of the average of our total assets at year-end for the last two completed fiscal years; and
|
|
·
|
In which any director, executive officer, stockholders who beneficially own more than 5% of our common stock or any member of their immediate family had or will have a direct or indirect material interest.
|
Office Space and Equipment
We utilize the home office space and equipment of our management
at no cost.
Jeffrey DeNunzio
and GMRZ
On October 19, 2018, we issued 500,000,000
shares of restricted common stock and 400,000 shares of Convertible Series B preferred stock to GMRZ for services rendered to us.
Mr. DeNunzio is the sole member of GMRZ. Indirectly, through Mr. DeNunzio’s ownership in GMRZ, Mr. DeNunzio was considered
a promoter of the Company until February 20, 2019, the date GMRZ sold its ownership interest in the Company to KBIG.
Paul Moody
On October 31, 2018, Paul Moody, the
Company’s former officer and director paid expenses on behalf of the Company totaling $1,376. This is considered a contribution
to the Company with no expectation of repayment and is posted as additional paid-in capital.
On November 15, 2018, Paul Moody contributed
$4,000 to the Company to be used for audit expenses. This is considered to be a contribution to the Company with no expectation
of repayment.
As of February 20, 2019, the date Paul
Moody resigned from all positions held in the Company, Mr. Moody is no longer considered to be a promoter of the Company.
Nirajkumar Patel and KBIG
On February 6, 2019, we entered into
the Agreement by and among GMRZ, KBIG, and us, pursuant to which, on February 20, 2019, GMRZ sold 504,000,000 shares of the Company’s
restricted common stock, representing approximately 88.06 percent of the Company’s issued and outstanding shares of common
stock, to KBIG, and KBIG paid GMRZ consideration of three hundred twenty-five thousand dollars ($325,000). The consummation of
the transactions contemplated by the Agreement resulted in a change in control of the Company, with KBIG becoming the Company’s
largest controlling stockholder. The sole members of KBIG are Nirajkumar Patel and Eric Mosser. Indirectly through Mr. Patel’s
ownership in KBIG, our majority stockholder, Mr. Patel and KBIG are considered promoters of the Company.
Eric Mosser and KBIG
On February 6, 2019, we entered into
the Agreement by and among GMRZ, KBIG, and us, pursuant to which, on February 20, 2019, GMRZ sold 504,000,000 shares of the Company’s
restricted common stock, representing approximately 88.06 percent of the Company’s issued and outstanding shares of common
stock, to KBIG, and KBIG paid GMRZ consideration of three hundred twenty-five thousand dollars ($325,000). The consummation of
the transactions contemplated by the Agreement resulted in a change in control of the Company, with KBIG becoming the Company’s
largest controlling stockholder. The sole members of KBIG are Nirajkumar Patel and Eric Mosser. Indirectly through Mr. Mosser’s
ownership in KBIG, our majority stockholder, Mr. Mosser and KBIG are considered promoters of the Company.
Director Independence
We are not listed on any exchange that requires directors
to be independent. We have not:
|
·
|
Established our own definition for determining whether our directors or nominees for directors are “independent,” nor have we adopted any other standard of independence employed by any national securities exchange or inter-dealer quotation system, though our current directors would not be deemed to be “independent” under any applicable definition given that they are officers of the Company; nor,
|
|
·
|
Established any committees of the Board.
|
Given the nature of the Company, our
limited stockholder base, and the current composition of our management, the Board does not believe that we require any committees
at this time. The Board will continue to evaluate the necessity of establishing committees, particularly once the Company commences
business operations. In addition, the Board will also continue to evaluate the adoption of an “independence” definition
as it relates to its directors and nominees for director.
ITEM 8. LEGAL PROCEEDINGS
Presently, there are not any material
pending legal proceedings to which the Company is a party or as to which any of its property is subject, and no such proceedings
are known to the Company to be threatened or contemplated against it.
ITEM 9. MARKET PRICE OF AND DIVIDENDS
ON THE REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Our Common Stock is quoted on the OTC
Pink. The stock symbol is QSHI. For the periods indicated, the following table sets forth the high and low bid prices per share
of common stock. The below prices represent inter-dealer quotations without retail markup, markdown, or commission and may not
necessary represent action transactions.
|
Price Range
|
Period
|
High
|
Low
|
Year Ended October 31, 2019:
|
|
|
First Quarter
|
$0.036
|
$0.0160
|
Second
Quarter (through April 17, 2019)
|
$0.025
|
$0.0115
|
Year Ended October 31, 2018:
|
|
|
Fourth Quarter (Inception through October 31, 2108)
|
$0.0380
|
$0.0081
|
-12-
Stockholders of Record
As of April 17, 2019, we have
572,364,574 shares of common stock issued and outstanding and no shares of preferred stock issued and outstanding. We have
approximately 176 stockholders of record.
Dividends
We have not paid any cash dividends
to date and do not anticipate or contemplate paying dividends in the foreseeable future. It is the present intention of our management
to utilize all available funds for the development of our business.
ITEM 10. RECENT SALES OF UNREGISTERED
SECURITIES
On October 19, 2018, we issued 500,000,000
shares of restricted common stock and 400,000 shares of Convertible Series B preferred stock to GMRZ for services rendered to us. Such
shares were issued pursuant to an exemption from registration at Section 4(a)(2) of the Securities Act and Regulation D promulgated
thereunder. These shares of our common stock qualified for exemption under Section 4(a)(2) of the Securities Act since the issuance
of shares by us did not involve a public offering. The offering was not a public offering as defined in Section 4(a)(2) due to
the insubstantial number of persons involved in the deal, size of the offering, manner of the offering, and number of shares offered.
We did not undertake an offering in which we sold a high number of shares to a high number of investors. In addition, this stockholder
had the necessary investment intent as required by Section 4(a)(2) since it agreed to and received share certificates bearing a
legend stating that such shares are restricted pursuant to Rule 144 of the Securities Act. This restriction ensures that these
shares would not be immediately redistributed into the market and, therefore, not be part of a public offering. Based on an analysis
of the above factors, we have met the requirements to qualify for exemption under Section 4(a)(2) of the Securities Act for this
transaction.
Commensurate with the filing of our
Amended and Restated Articles of Incorporation, filed with the Delaware Secretary of State on October 22, 2018, every issued and
outstanding share of Series A Preferred Stock was converted into 1.25 shares of common stock with stockholders’ economic
rights preserved. Additionally, at the same time, every one share of Series B Preferred Stock, issued and outstanding, was converted
into ten shares of common stock with stockholders’ economic rights adversely affected in the conversion.
ITEM 11. DESCRIPTION OF REGISTRANT’S
SECURITIES TO BE REGISTERED
Common Stock and Preferred Stock
We are authorized by our Restated
Certificate of Incorporation to issue an aggregate of 1,000,000,000 shares of common stock par value $0.001 per share, of
which 572,364,574 are issued and outstanding as of April 17, 2019, and 5,000,000 shares of preferred stock, of which no
shares of preferred stock are issued and outstanding as of April 17, 2019.
Common Stock
Our Restated Certificate
of Incorporation authorizes the issuance of up to 1,000,000,000 shares of common stock, par value $0.001 per share. All outstanding
shares of common stock are of the same class and have equal rights and attributes. The holders of common stock are entitled to
one vote per share on all matters submitted to a vote of stockholders of the Company. All stockholders are entitled to share equally
in dividends, if any, as may be declared from time to time by the Board out of funds legally available. In the event of liquidation,
the holders of Common Stock are entitled to share ratably in all assets remaining after payment of all liabilities. Stockholders
do not have cumulative or preemptive rights.
Preferred Stock
Our Restated Certificate
of Incorporation authorizes the issuance of up to 5,000,000 shares of preferred stock with designations, rights, and preferences
to be determined from time to time by our Board. Accordingly, our Board is empowered, without stockholder approval, to issue preferred
stock with dividend, liquidation, conversion, voting, or other rights that could adversely affect the voting power or other rights
of the holders of the Common Stock. In the event of issuance, the preferred stock could be utilized, under certain circumstances,
as a method of discouraging, delaying, or preventing a change in control of the Company. Although we have no present intention
to issue any shares of our authorized preferred stock, there can be no assurance that we will not do so in the future.
Exclusive Forum Provision
Our Restated Certificate of Incorporation
includes a provision related to the exclusive forum for certain types of actions. Unless we consent in writing to the selection
of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (i) any derivative
action or proceeding brought on behalf of us, (ii) any action asserting a claim of breach of fiduciary duty owed by any of our
directors, officers, or other employees to us or our stockholders, (iii) any action asserting a claim arising pursuant to any
provision of the DGCL, or (iv) any action asserting a claim governed by the internal affairs doctrine. Any person or entity purchasing
or otherwise acquiring any interest in shares of our capital stock will be deemed to have notice of and consented to this exclusive
forum provision. This exclusive forum provision does not preclude or contract the scope of exclusive federal or concurrent jurisdiction
for suits brought to enforce any duty or liability created by the Exchange Act or the Securities Act, and the respective rules
and regulations thereunder.
-13-
The following statements relating to
the capital stock set forth the material terms of our securities; however, reference is made to the more detailed provisions of,
and such statements that are referenced in our Restated Certification of Incorporation and the Bylaws, copies of which
are filed as exhibits to this Registration Statement.
Debt Securities
None.
Other Securities
None.
ITEM 12. INDEMNIFICATION OF DIRECTORS
AND OFFICERS
Our directors and officers are indemnified
as provided by the DGCL and our Bylaws. We have agreed to indemnify each of our directors and certain officers against certain
liabilities, including liabilities under the Securities Act. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers, and controlling persons pursuant to the provisions described above, or otherwise,
we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities
Act and, therefore, is unenforceable. In the event that a claim for indemnification against such liabilities (other than our payment
of expenses incurred or paid by our director, officer, or controlling person in the successful defense of any action, suit, or
proceeding) is asserted by such director, officer, or controlling person in connection with the securities being registered, 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 such indemnification by it is against public policy as expressed in the Securities Act and will
be governed by the final adjudication of such issue.
-14-
ITEM
13. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Quick
Start Holdings, Inc.
Index
to Audited Financial Statements
|
|
Page
|
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
F-2
|
|
|
|
Financial Statements:
|
|
|
|
|
|
Balance Sheet
|
|
F-3
|
|
|
|
Statement of Operations
|
|
F-4
|
|
|
|
Statement of Changes in Stockholder Deficit
|
|
F-5
|
|
|
|
Statement of Cash Flows
|
|
F-6
|
|
|
|
Notes to the Financial Statements
|
|
F-7 to F-10
|
-F1-
REPORT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors of
Quick Start Holdings, Inc.
Opinion on the Financial
Statements
We have audited the accompanying
balance sheet of Quick Start Holdings, Inc. (the “Company”) as of October 31, 2018, and the related statement of operations,
changes in stockholders’ deficit, and cash flows for the period from September 4, 2018 (inception) through the year ended
October 31, 2018, and the related notes (collectively referred to as the “financial statements”). In our opinion, the
financial statements present fairly, in all material respects, the financial position of the Company as of October 31, 2018, and
the results of its operations and its cash flows for the period from September 4, 2018 (inception) through October 31, 2018, in
conformity with accounting principles generally accepted in the United States of America.
Going Concern Matter
The accompanying financial
statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial
statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raises substantial
doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note
3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements
are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial
statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United
States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in
accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement, whether due to error or fraud. 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 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 financial statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and
disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates
made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides
a reasonable basis for our opinion.
/s/ MaloneBailey, LLP
www.malonebailey.com
We have served as the Company's
auditor since 2018.
Houston, Texas
January 9, 2019
-F2-
Quick Start Holdings, Inc.
Balance Sheet
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of October 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS
|
|
$
|
-
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
Accrued expenses
|
|
$
|
3,000
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
3,000
|
|
|
|
|
|
|
|
TOTAL LIABILITIES
|
|
|
$
|
3,000
|
|
|
|
|
|
|
|
|
STOCKHOLDERS' DEFICIT:
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock ($.001 par value, 5,000,000 shares authorized, none issued and outstanding as of October 31, 2018)
|
|
-
|
|
|
|
|
|
|
|
|
|
Common stock ($.001 par value, 1,000,000,000 shares authorized, 572,364,574 issued and outstanding as of October 31, 2018)
|
|
572,365
|
|
|
|
|
|
|
|
|
|
Additional paid in capital
|
|
|
(570,989)
|
|
|
|
|
|
|
|
|
|
Accumulated deficit
|
|
|
(4,376)
|
|
Total Stockholders' deficit
|
|
|
(3,000)
|
TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT
|
|
$
|
-
|
The
accompanying notes are an integral part of these financial statements.
-F3-
Quick Start Holdings, Inc.
Statement of Operations
|
|
|
|
For the period from September 4, 2018 (date of inception) to October 31, 2018
|
|
|
|
|
Operating expenses
|
|
|
|
|
|
|
|
General and administrative expenses
|
|
$
|
4,376
|
Total operating expenses
|
|
4,376
|
|
|
|
|
Net loss
|
|
$
|
(4,376)
|
|
|
|
|
Basic and Diluted net loss per common share
|
|
$
|
(0.00)
|
|
|
|
|
Weighted average number of common shares outstanding - Basic and Diluted
|
|
|
155,129,844
|
The
accompanying notes are an integral part of these financial statements.
-F4-
Quick Start Holdings, Inc.
|
Statement of Changes in Stockholders’ Deficit
|
For the period from September 4, 2018 (date of inception) to October 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred Shares
(Series A)
|
Preferred Shares
(Series B)
|
|
Par Value Preferred Shares (Series A)
|
|
Par Value Preferred Shares (Series B)
|
Common Shares
|
|
Par Value Common Shares
|
|
|
Additional Paid-in Capital
|
|
Accumulated Deficit
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date of Inception, September 4, 2018
|
-
|
-
|
$
|
-
|
$
|
-
|
-
|
$
|
-
|
|
$
|
-
|
$
|
-
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued in Reorganization
|
1,000,000
|
71,700
|
|
1,000
|
|
72
|
66,397,574
|
|
66,398
|
|
|
(67,470)
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of Preferred and Common shares for services
|
-
|
400,000
|
|
-
|
|
400
|
500,000,000
|
|
500,000
|
|
|
(500,400)
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conversion of Preferred Series A & B into common shares
|
(1,000,000)
|
(471,700)
|
|
(1,000)
|
|
(472)
|
5,967,000
|
|
5,967
|
|
|
(4,995)
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expensed paid on behalf of the Company and contributed to capital
|
-
|
-
|
|
-
|
|
-
|
-
|
|
-
|
|
|
1,376
|
|
-
|
|
1,376
|
|
Net loss
|
-
|
-
|
|
-
|
|
-
|
-
|
|
-
|
|
|
-
|
|
(4,376)
|
|
(4,376)
|
|
Balances, October 31, 2018
|
-
|
-
|
$
|
-
|
$
|
-
|
572,364,574
|
$
|
572,365
|
$
|
|
(570,989)
|
$
|
(4,376)
|
$
|
(3,000)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
accompanying notes are an integral part of these financial statements.
-F5-
Quick Start Holdings, Inc.
Statement of Cash Flows
|
|
For the period September 4, 2018 (date
of inception) to October 31, 2018
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
Net loss
|
|
$
|
(4,376)
|
Adjustment to reconcile net loss to net cash used in operating activities:
|
|
|
|
Expenses contributed to capital
|
|
|
1,376
|
Changes in current assets and liabilities:
|
|
|
|
Accrued expenses
|
|
|
3,000
|
Net cash used in operating activities
|
|
|
-
|
|
|
|
|
Net change in cash
|
|
$
|
-
|
Beginning cash balance
|
|
|
-
|
Ending cash balance
|
|
$
|
-
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
|
|
|
|
|
|
|
Interest paid
|
|
$
|
-
|
Income taxes paid
|
|
$
|
-
|
|
|
|
|
NON-CASH FINANCING TRANSACTIONS:
|
|
|
|
|
|
|
|
Preferred Series A and B and common shares issued in reorganization
|
|
$
|
67,470
|
Preferred Series B and common shares issued for services
|
|
$
|
500,400
|
Conversion of Preferred Series A & B into common Shares
|
|
$
|
4,495
|
The
accompanying notes are an integral part of these financial statements.
-F6-
Quick Start Holdings, Inc.
Notes to the Financial Statements
Note 1 – Organization and Description of Business
Quick Start Holdings, Inc. (we, us,
our, the "Company" or the "Registrant") was incorporated on September 4, 2018 in the State of Delaware.
On September 4, 2018, Paul Moody was
appointed Chief Executive Officer, Chief Financial Officer, and Director of Quick Start Holdings, Inc.
USSE Corp., a Nevada Corporation, (“Predecessor”)
was created and incorporated with the Nevada Secretary of State on July 8, 1998 under the original name C&A Restaurants, Inc.
On June 15, 2009, the C&A Restaurants changed its name to USSE Corp. Effective September 19, 2018, USSE Corp. re-domiciled
from Nevada to Delaware pursuant to a merger amongst, and between, USSE Corp, a Nevada Company, and USSE Delaware, Inc., a Delaware
Company. This resulted in USSE Delaware, Inc. becoming the surviving entity. Each share of USSE Corp’s Capital Stock issued
and outstanding immediately prior to the Effective Time of the merger was automatically converted into one fully paid and nonassessable
share of USSE Delaware, Inc., a Delaware Company.
The above action resulted in USSE Delaware,
Inc., having the authority to issue 1,005,000,000 shares, which consisted of: (i) 1,000,000,000 shares of Common Stock, par value
$0.001 per share of which 66,397,574 shares were issued and outstanding; (ii) 5,000,000 shares of Preferred Stock, par value $.001
per share, of which 1,000,000 shares were designated as Convertible Series A, and 1,000,000 Convertible Series A preferred shares
were issued and outstanding; and 500,000 shares which were designated as Convertible Series B, of which 71,700 Convertible Series
B preferred shares were issued and outstanding.
Consecutively following the re-domestication,
also with an effective date of September 19, 2018, the Company completed a holding company reorganization, (“Holding Company
Reorganization”) pursuant to Section 251(g) of the Delaware General Corporation Law, (the “DGCL”) in which USSE
Corp. became a wholly owned subsidiary of Quick Start Holdings, Inc., (“Successor”), a Delaware Corporation.
The details of the reorganization are
as follows: On September 4, 2018 USSE Delaware, Inc. acquired 1,000 common shares of Quick Start Holding, Inc., which represented
100% of the Company’s outstanding shares at the time, for no consideration. The Holding Company Reorganization was amongst,
and between, USSE Delaware, Inc., a Delaware Corporation, Quick Start Holdings, Inc., a Delaware Corporation and USSE Merger Sub,
Inc., a Delaware Corporation. Immediately prior to the reorganization Quick Start Holdings, Inc. was a wholly owned subsidiary
of USSE Delaware, Inc. and USSE Merger Sub, Inc. was a wholly owned subsidiary of Quick Start Holdings, Inc.
(2) Effective on September 19, 2018,
and in accordance with the provisions set forth in Section 251(g) of the DGCL, USSE Merger Sub, Inc. merged with and into USSE
Delaware, Inc., with USSE Delaware, Inc. as the surviving corporation. At the effective time, the separate corporate existence
of USSE Merger Sub, Inc. ceased and USSE Delaware, Inc. changed its name to USSE Corp., which then became the wholly owned subsidiary
of Quick Start Holdings, Inc. This resulted in the conversion of securities of USSE Delaware, Inc. into identical and equivalent
securities of Quick Start Holdings, Inc. Stockholders of USSE Delaware, Inc. became stockholders of Quick Start Holdings, Inc.
Upon completion of the above reorganization,
also referred to herein as the “Effective Time”, by virtue of the merger, and without any action on the part of the
holder thereof, each share of USSE Delaware, Inc. Common Stock issued and outstanding immediately prior to the Effective Time was
converted into one validly issued, fully paid and non-assessable share of Quick Start Holdings, Inc. Common Stock.
(1) Immediately prior to the effective
time of the reorganization each share of Quick Start Holdings, Inc. common stock issued and outstanding held in the name of USSE
Delaware, Inc. was cancelled and retired and resumed the status of authorized and unissued shares of Quick Start Holdings, Inc.
common stock.
Upon completion of the above reorganization,
also referred to herein as the “Effective Time”, by virtue of the merger, and without any action on the part of the
holder thereof, each share of USSE Delaware, Inc. preferred stock issued and outstanding immediately prior to the Effective Time
was converted into one validly issued, fully paid and non-assessable share of Quick Start Holdings, Inc. preferred stock, having
the same designations, rights, powers and preferences, and the qualifications, limitation and restrictions thereof, as the corresponding
share of USSE Delaware, Inc. Preferred Stock.
Concurrently, with the completion of
the aforementioned reorganization, effective on September 19, 2018, any shares held by Quick Start Holdings, Inc. in USSE Corp.
were cancelled. This resulted in Quick Start Holdings, Inc. having the authority to issue 1,005,000,000 shares, which consisted
of: (i) 1,000,000,000 shares of Common Stock, par value $0.001 per share of which 66,397,574 shares were issued and outstanding;
(ii) 5,000,000 shares of Preferred Stock, par value $.001 per share, of which 1,000,000 shares were designated as Convertible Series
A, and 1,000,000 Convertible Series A preferred shares were issued and outstanding; and 500,000 shares which were designated as
Convertible Series B, of which 71,700 Convertible Series B preferred shares were issued and outstanding.
On October 19, 2018, the Company issued
500,000,000 shares of restricted Common Stock and 400,000 shares of Series B Preferred Stock to GMRZ Holdings LLC., a Company owned
by Jeff DeNunzio. These shares were issued as founder shares and all were issued at nominal value.
Commensurate with the filing of our
Restated and Amended Articles of Incorporation, filed with the Delaware Secretary of State on October 22, 2018 every issued and
outstanding share of Series A Preferred Stock was converted into 1.25 shares of Common Stock with shareholders’ economic
rights preserved. Additionally, at the same time, every one share of Series B Preferred Stock, issued and outstanding, was converted
into ten shares of Common Stock with shareholders’ economic rights adversely affected in the conversion. Immediately following
the conversion of the aforementioned shares, and upon filing of the Restated and Amended Articles of Incorporation, authorized
and unissued shares of Convertible Series A and Convertible Series B Preferred Stock were cancelled. As of October 22, 2018, Series
A and Series B Preferred Stock were removed from the status of authorized but unissued preferred stock.
On February 6, 2019, Quick Start Holdings,
Inc., a Delaware corporation (the “Company”), entered into a non-binding Share Purchase Agreement (the “Agreement”)
by and among GMRZ Holdings, LLC, a Nevada limited liability company, and Kaival Brands Innovations Group, LLC, a Delaware limited
liability company (“KBIG”), pursuant to which, on February 20, 2019, GMRZ sold 504,000,000 shares of the Company’s
restricted common stock, representing approximately 88.06 percent of the Company’s issued and outstanding shares of common
stock, to KBIG, and KBIG paid GMRZ consideration of three hundred twenty-five thousand dollars ($325,000) (the “Purchase
Price”). The consummation of the transactions contemplated by the Agreement resulted in a change in control of the Company,
with KBIG becoming the Company’s largest controlling stockholder. The sole members of KBIG are Nirajkumar Patel and Eric
Mosser. The Purchase Price was paid with personal funds of the members of KBIG.
On February 19, 2019, the Company filed
with the Secretary of State of the State of Delaware a Certificate of Amendment to Amended and Restated Certificate of Incorporation
(the “Certificate of Amendment”) to clarify the exclusive forum provision.
On February 20, 2019, Mr. Paul Moody
resigned as the Company’s Chief Executive Officer, Chief Financial Officer, President, Secretary, Treasurer, and Director.
The resignation was not the result of any disagreement with the Company on any matter relating to its operations, policies, or
practices.
On February 20, 2019, Mr. Nirajkumar
Patel was appointed as Chief Executive Officer, Chief Financial Officer, President, Treasurer, and Director. There is no arrangement
or understanding among Mr. Patel and any other person pursuant to which he was appointed as a director and officer of the Company.
Also on February 20, 2019, Mr. Eric Mosser was appointed as Chief Operating Officer, Secretary, and Director. There is no arrangement
or understanding among Mr. Mosser and any other person, pursuant to which he was appointed as a director and officer of the Company.
Neither Mr. Patel or Mr. Mosser have a direct or indirect material interest in any transaction required to be disclosed pursuant
to Item 404(a) of Regulation S-K. At this time, the Company does not have any written employment agreements or other formal compensation
agreements with our new officers and directors. Compensation arrangements are the subject of ongoing development and the Company
will disclose any compensatory arrangements entered into in the future.
Currently, we have 572,364,574 shares
of common stock issued and outstanding and no shares of preferred stock issued and outstanding.
Currently, Kaival Brands Innovations
Group, LLC, a Delaware limited liability company, owned and controlled by Nirajkumar Patel and Eric Mosser, is our controlling
shareholder, owning 504,000,000 shares of our restricted common stock.
The Company intends to serve as a vehicle
to affect an asset acquisition, merger, exchange of capital stock or other business combination with a domestic or foreign business.
As of October 31, 2018, the Company had not yet commenced any operations.
The Company has elected October 31st as its
year end.
Note 2 – Summary of Significant Accounting Policies
Basis of Presentation
This summary of significant accounting
policies is presented to assist in understanding the Company's financial statements. These accounting policies conform to accounting
principles, generally accepted in the United States of America, and have been consistently applied in the preparation of the financial
statements.
Use of Estimates
The preparation of financial statements
in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses during the reporting period. In the opinion of management, all adjustments necessary
in order to make the financial statements not misleading have been included. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid
investments with an original maturity of three months or less when purchased to be cash equivalents. Cash and cash equivalents
at October 31, 2018 were $0.
-F7-
Income Taxes
The Company accounts for income taxes
under ASC 740, “
Income Taxes
.” Under the asset and liability method of ASC 740, deferred tax assets and
liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying
amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured
using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be
recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income
in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely
than not that the Company will not realize tax assets through future operations. No deferred tax assets or liabilities were
recognized at October 31, 2018.
Basic Earnings (Loss) Per Share
The Company computes basic and diluted
earnings (loss) per share in accordance with ASC Topic 260,
Earnings per Share
. Basic earnings (loss) per share is
computed by dividing net income (loss) by the weighted average number of common shares outstanding during the reporting period.
Diluted earnings (loss) per share reflects the potential dilution that could occur if stock options and other commitments to issue
common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of
the Company.
The Company does not have any potentially
dilutive instruments as of October 31, 2018 and, thus, anti-dilution issues are not applicable.
Fair Value of Financial Instruments
The Company’s balance sheet
includes certain financial instruments. The carrying amounts of current assets and current liabilities approximate their fair value
because of the relatively short period of time between the origination of these instruments and their expected realization.
ASC 820,
Fair Value Measurements
and Disclosures
, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability
(an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market
participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market
participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s
own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable
inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices
in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three
levels of the fair value hierarchy are described below:
- Level 1 - Unadjusted quoted prices
in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
- Level 2 - Inputs other than quoted
prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted
prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets
that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and
inputs that are derived principally from or corroborated by observable market data by correlation or other means.
- Level 3 - Inputs that are both significant
to the fair value measurement and unobservable.
-F8-
Fair value estimates discussed herein
are based upon certain market assumptions and pertinent information available to management as of October 31, 2018. The respective
carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of
these instruments. These financial instruments include accrued expenses.
Related Parties
The Company follows ASC 850,
Related
Party Disclosures,
for the identification of related parties and disclosure of related party transactions.
Share-Based Compensation
ASC 718, “
Compensation –
Stock Compensation
”, prescribes accounting and reporting standards for all share-based payment transactions in which
employee services are acquired. Transactions include incurring liabilities, or issuing or offering to issue shares, options, and
other equity instruments such as employee stock ownership plans and stock appreciation rights. Share-based payments to employees,
including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair
values. That expense is recognized over the period during which an employee is required to provide services in exchange for the
award, known as the requisite service period (usually the vesting period).
The Company accounts for stock-based
compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50, “
Equity –
Based Payments to Non-Employees.”
Measurement of share-based payment transactions with non-employees is based
on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments
issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date
or performance completion date.
The Company had no stock-based
compensation plans as of October 31, 2018.
The Company’s stock based compensation
for the period ended October 31, 2018 was $0.
Recently Issued Accounting Pronouncements
The Company has implemented all new
accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any
other new pronouncements that have been issued that might have a material impact on its financial position or results of operations.
Note 3 – Going Concern
The Company’s financial statements
are prepared in accordance with generally accepted accounting principles applicable to a going concern that contemplates the realization
of assets and liquidation of liabilities in the normal course of business.
The Company demonstrates adverse conditions
that raise substantial doubt about the Company's ability to continue as a going concern for one year following the issuance of
these financial statements. These adverse conditions are negative financial trends, specifically operating loss, working capital
deficiency, and other adverse key financial ratios.
The Company has not established any
source of revenue to cover its operating costs. Management plans to fund operating expenses with related party contributions to
capital. There is no assurance that management's plan will be successful. The financial statements do not include any adjustments
relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might
be necessary in the event that the Company cannot continue as a going concern.
-F9-
Note 4 – Income Taxes
The
Company has not recognized an income tax benefit for its operating losses generated based on uncertainties concerning its ability
to generate taxable income in future periods. The tax benefit for the period presented is offset by a valuation allowance established
against deferred tax assets arising from the net operating losses, the realization of which could not be considered more likely
than not. In future periods, tax benefits and related deferred tax assets will be recognized when management considers realization
of such amounts to be more likely than not. As of October 31, 2018, the Company has incurred a net loss of approximately $4,376
which resulted in a net operating loss for income tax purposes.
The
loss results in a deferred tax asset of approximately $919 at the effective statutory rate of 21%. The deferred tax asset has been
off-set by an equal valuation allowance
.
Given our inception on September 4, 2018, and our fiscal year end of October 31, 2018, we have completed only one taxable fiscal
year.
Note 5 – Commitments
and Contingencies
The Company follows ASC 450-20,
Los
s
Contingencies,
to
report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines
and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment
can be reasonably estimated. There were no commitments or contingencies as of October 31, 2018.
Note 6 – Shareholder Equity
Preferred Stock
The
authorized preferred stock of the Company consists of 5,000,000 shares with a par value of $0.001. The Company had no shares of
preferred stock issued and outstanding as of October 31, 2018.
Authorized
but unissued Preferred Stock of the Corporation has no voting rights, conversion rights, or any additional attributes. The Board
of Directors may, in the future, issue additional classes of preferred stock which shall have attributes and rights as determined
by the Board of Directors at that time.
Common Stock
The authorized common stock of the Company
consists of 1,000,000,000 shares with a par value of $0.001. There were 572,364,574 shares of common stock issued and outstanding
as of October 31, 2018.
On September 19, 2018, with the completion
of the aforementioned reorganization, each share of USSE Corp's Capital Stock issued and outstanding immediately prior to the merger
was automatically converted into one fully paid and nonassessable share of USSE Delaware, Inc., a Delaware Company. The details
of the reorganization are as follows: On September 4, 2018 USSE Delaware, Inc. acquired 1,000 common shares of Quick Start Holding,
Inc., which represented 100% of the Company's outstanding shares at the time, for no consideration.
Immediately prior to the reorganization
Quick Start Holdings, Inc. was a wholly owned subsidiary of USSE Delaware, Inc. and USSE Merger Sub, Inc. was a wholly owned subsidiary
of Quick Start Holdings, Inc. Each share of Quick Start Holdings, Inc. common stock issued and outstanding held in the name of
USSE Delaware, Inc. was cancelled and retired and resumed the status of authorized and unissued shares of Quick Start Holdings,
Inc. common stock
As a result of the reorganization the
Company issued 66,397,574 common shares, 1,000,000 preferred shares Convertible Series A; and 71,700 Convertible Series B preferred
shares, all of which had a nominal value.
The outstanding shares were originally
issued by USSE prior to reorganization and are now listed as converted shares for the Company.
On October 19, 2018, the Company issued
500,000,000 shares of restricted Common Stock and 400,000 shares of Series B Preferred Stock to GMRZ Holdings LLC., a Company owned
by Jeff DeNunzio. These shares were issued as founder shares and all were issued at nominal value resulting in a reduction of paid
in capital.
On October 22, 2018, as a result of
filing the Restated and Amended Articles of Incorporation, every issued and outstanding share of Series A Preferred Stock was converted
into 1.25 shares of Common Stock. Additionally, every one share of Series B Preferred Stock, issued and outstanding, was converted
into ten shares of Common Stock. Immediately following the conversion and upon filing of the Restated Articles, authorized and
unissued shares of Convertible Series A and Convertible Series B Preferred Stock were cancelled.
On February 6, 2019, Quick Start Holdings,
Inc., a Delaware corporation (the “Company”), entered into a non-binding Share Purchase Agreement (the “Agreement”)
by and among GMRZ Holdings, LLC, a Nevada limited liability company, and Kaival Brands Innovations Group, LLC, a Delaware limited
liability company (“KBIG”), pursuant to which, on February 20, 2019, GMRZ sold 504,000,000 shares of the Company’s
restricted common stock, representing approximately 88.06 percent of the Company’s issued and outstanding shares of common
stock, to KBIG, and KBIG paid GMRZ consideration of three hundred twenty-five thousand dollars ($325,000) (the “Purchase
Price”). The consummation of the transactions contemplated by the Agreement resulted in a change in control of the Company,
with KBIG becoming the Company’s largest controlling stockholder. The sole members of KBIG are Nirajkumar Patel and Eric
Mosser. The Purchase Price was paid with personal funds of the members of KBIG.
Additional Paid-In Capital
The
Company’s former officer and director, Paul Moody, paid expenses on behalf of the company totaling $1,376 as of October 31,
2018. This is considered a contribution to the company with no expectation of repayment and is posted as additional paid-in capital.
Note 7 – Related-Party Transactions
Office Space
We
utilize the home office space and equipment of our management at no cost.
Note 8 – Subsequent Events
Management
has reviewed financial transactions for the Company subsequent to the fiscal year end and has found that, with the exception of
on
November 15, 2018, Paul Moody contributed $4,000 to the Company to be used for audit expenses, there was nothing material to disclose.
This is considered to be a contribution to the
Company with no expectation of repayment.
-F10-
Item 14. Changes
in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 15. Exhibits
|
|
Exhibit Number
|
Description
|
|
|
3.1
|
Restated Certificate of Incorporation, which was filed as Exhibit 3.1 to our Registration Statement on Form 10-12G filed with the SEC on March 25, 2019, and is incorporated herein by reference thereto
.
|
|
|
3.2
|
Bylaws, which were filed as Exhibit 3.2 to our Registration Statement on Form 10-12G filed with the SEC on February 19, 2019, and is incorporated herein by reference thereto
.
|
|
|
10.1
|
Share Purchase Agreement between Quick Start Holdings, Inc., GMRZ Holdings, LLC, and Kaival Innovations Group, LLC dated February 6, 2019, which was filed as Exhibit 10.1 to our Current Report on Form 8-K filed with the SEC on February 25, 2019, and is incorporated herein by reference thereto
.
|
SIGNATURES
In accordance with Section 12 of the
Securities Exchange Act of 1934, the registrant caused this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized.
April
19, 2019
|
Quick Start Holdings, Inc.
|
|
|
|
|
By:
|
/s/ Nirajkumar Patel
|
|
Name: Nirajkumar Patel
|
|
Title: Chief Executive Officer
|
-15-