Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM 10/Amendment 1
GENERAL FORM FOR REGISTRATION OF SECURITIES
Pursuant to Section 12(b) or (g) of the Securities
Exchange Act of 1934
REDTONE ASIA, INC. |
(Exact name of registrant as specified in its charter) |
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Nevada |
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71-098116 |
(State of other jurisdiction of
incorporation or organization) |
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(IRS Employer
Identification No.) |
42 Mott Street
4th Floor
New York, NY 10013
(Address of Principal
Executive Offices) (Zip Code)
86-1370164788
(Registrant’s
telephone number, including area code)
Securities to be
Registered Under Section 12(b) of the Act:
None
Securities to be
Registered Under Section 12(g) of the Act:
Common Stock, Par
Value $0.0001
(Title of Class)
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.
See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and
“emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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Accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
☐ |
If an emerging growth company, indicate by
check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. ☐
REDTONE ASIA, INC.
INDEX TO FORM 10
Cautionary Note Regarding
Forward-Looking Statements
This registration statement on Form 10
contains “forward-looking statements” concerning our future results, future performance, intentions, objectives, plans, and
expectations, including, without limitation, statements regarding the plans and objectives of management for future operations, any statements
concerning our proposed services, any statements regarding future economic conditions or performance, and any statements of assumptions
underlying any of the foregoing. All forward-looking statements included in this document are made as of the date hereof and are based
on information available to us as of such date. We assume no obligation to update any forward-looking statements. In some cases, forward-looking
statements can be identified by the use of terminology such as “may,” “will,” “expects,” “plans,”
“anticipates,” “intends,” “believes,” “estimates,” “potential,” or “continue,”
or the negative thereof or other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements
contained herein are reasonable, there can be no assurance that such expectations or any of the forward-looking statements will prove
to be correct, and actual results could differ materially from those projected or assumed in the forward-looking statements. Future financial
condition and results of operations, as well as any forward-looking statements are subject to inherent risks and uncertainties, including
those discussed under “Risk Factors” and elsewhere in this Form 10.
Introductory Comment
We are filing this General Form for Registration
of Securities on Form 10 to register our common stock pursuant to Section 12(g) of the Exchange Act. Once this registration statement
is deemed effective, we will be subject to the requirements of Section 13(a) under the Exchange Act, which will require us to file annual
reports on Form 10-K (or any successor form), quarterly reports on Form 10-Q (or any successor form), 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.
Throughout this Form 10, unless the context
otherwise requires, the terms “we,” “us,” “our,” the “Company,” “RTAS" and
“our Company” refer to REDTone Asia., a Nevada corporation.
RTAS is a Blank Check Company under Rule 419
of the Securities Act of 1933.
The term ‘blank check company”
means that we are a development stage company and have no specific business plan or purpose or has indicated that our business plan is
to engage in a merger or acquisition with an unidentified company, or other entity or person. A blank check company:
(i) Is a development stage company
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; and
(ii) Is issuing “penny stock,”
as defined in Rule 3a51-1 under the Securities Exchange Act of 1934.
As of this filing, RTAS has no business plan and hopes to acquire a
business in Photovoltaic solar energy, energy storage equipment and charging piles. RTAS hopes to raise sufficient capital to locate
a suitable merger candidate.
Our Company is currently listed on the Grey Market on the OTC Markets
platform. Our stock quote is not currently quoted on OTC Markets. The market for our stock is uncertain at this time. Quotations in Grey
Market securities are restricted from public viewing and only broker-dealers and professional or sophisticated investors are permitted
to view quotations in Grey Market securities. Our securities could be particularly illiquid due to being listed on this market and that
if we remain on the Grey Market it could impede a potential merger, acquisition, reverse merger or business combination pursuant to which
the company could become an operating company.
We have taken steps to be listed on a different tier of the OTC Markets.
The filing of this registration statement and continued compliance with financial reporting requirements will allow RTAS to be listed
as a Pink Current company on the OTC Markets platform. In addition, we are actively pursuing a viable merger candidate which will allow
us continued Pink Current status and file a Form 15c2-11 in the future.
The Company is not currently
organized under a Variable Interest Entity (“VIE”) however, we may decide to implement a VIE structure in the future. The
disclosed risks or events are only applicable if we decide to implement a VIE structure.
China’s Foreign Investment
Law (FIL) may prohibit direct foreign investment in Chinese operating companies moving forward.
We will continue to monitor the
changes in FIL, and RTAS may consider migrating to a VIE structure to continue receiving participation from foreign investors.
RTAS does not have a VIE structure
at this time and the following implications of operating under a VIE structure do not apply to us. However, if we decide to implement
a VIE structure moving forward, as discussed in detail below, the value of our common stock may decline or become worthless, and
the shareholder could lose their entire investment.
Our contemplated VIE structure
would consist of at least three core entities: a Chinese company with legitimate operations (referred to as contemplated the VIE); a wholly
foreign-owned enterprise established as an intermediary in China; and an offshore shell company that lists on a U.S. or other foreign
exchange.
US Courts are unlikely to enforce
the contracts and VIE contracts have not been tested in a court of law. Because the value of the offshore shell company derives from its
ability to consolidate the Chinese VIE on its financial statements, losing the VIE as a result of breached contracts (or government enforcement)
would significantly devalue shareholders’ investments. RTAS is not organized under a VIE structure, but if we do implement
one, there would be substantial legal uncertainties surrounding the related contractual arrangements.
The
Chinese government could rule that the VIE structure is against public policy, Chinese laws, and regulations. This ruling would likely
result in a material change in our contemplated operations. Furthermore, the disruption or termination of our operations could result
in the decline in the value of our stock. Our stock may become worthless, and the shareholder could lose their entire investment. See
Item 1.A Risk Factors: Risks Related to Access to Information and Regulatory Oversight.
Any
failure by our contemplated VIE or its shareholders to perform their obligations under our contractual arrangements with them would have
a material and adverse effect on our business. If our contemplated VIE or their shareholders fail to perform their respective obligations
under the contractual arrangements, we may have to incur substantial costs and expend additional resources to enforce such arrangements.
We may also have to rely on legal remedies under PRC law, including seeking specific performance or injunctive relief, and contractual
remedies, which we cannot assure you will be sufficient or effective under PRC law.
In addition, if any third parties claim any
interest in such shareholders' equity interests in our contemplated VIE, our ability to exercise shareholders' rights or foreclose the
share pledge according to the contractual arrangements may be impaired. If these or other disputes between the shareholders of our contemplated
VIE and third parties were to impair our control over our contemplated VIE, our ability to consolidate the financial results of our contemplated
VIE would be affected, which would in turn result in a material adverse effect on our business, operations and financial condition.
RTAS does not currently use a VIE structure, but that if we do implement
one, there would be substantial legal uncertainties surrounding the related contractual arrangements. However, these risks or events are
only applicable if we decide to implement a VIE structure.
There are greater legal and operational risks associated having the
majority of our contemplated operations in China.
The Holding Foreign Companies Accountable Act (“HFCAA”)
became law in December 2020 and prohibits foreign companies from listing their securities on U.S. exchanges if the company has been unavailable
for PCAOB inspection or investigation for three consecutive years.
The HFCAA requires the SEC to identify registrants that have
retained a registered public accounting firm to issue an audit report where that registered public
accounting firm has a branch or office that:
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Is located in a foreign jurisdiction; and |
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The PCAOB has determined that it is unable to inspect or investigate completely because of a position taken by an authority in the foreign jurisdiction |
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As reflected on the PCAOB's website, the PCAOB is currently unable to inspect or investigate accounting firms due to a position of the local authority in two jurisdictions: China and Hong Kong |
If a PCAOB auditor is unable to inspect the issuer's public accounting
firm for three consecutive years, the issuer's securities are banned from trade on a national exchange or through other methods. The United
States Senate passed the Accelerating Holding Foreign Companies Accountable Act, which, if enacted, would decrease the number of non-inspection
years from three years to two years. As a result, our securities could be delisted rendering our stock worthless as a result of "non-inspection"
by the PCAOB.
On December 16, 2021, the PCAOB issued a report on its determinations
that if the Board is unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in mainland China
and in Hong Kong, a Special Administrative Region of the People’s Republic of China (PRC), because of positions taken by PRC authorities
in those jurisdictions, it will suspend trading of the issuer. The Board made these determinations pursuant to PCAOB Rule 6100 which
provides a framework for how the PCAOB fulfills its responsibilities under the Holding Foreign Companies Accountable Act (HFCAA).
On December 16, 2021, the following amendments to the HCFAA were adopted
by the Securities and Exchange Commission:
Consistent with the HFCAA, the final amendments require Commission-Identified
Issuers to submit documentation to the SEC through the EDGAR system on or before its annual report due date that establishes that it is
not owned or controlled by a governmental entity in its public accounting firm’s foreign jurisdiction. The final amendments also
require a Commission-Identified Issuer that is also a “foreign issuer,” as defined in Exchange Act Rule 3b-4, to provide certain
additional specified disclosures in their annual report for itself and its consolidated foreign operating entity or entities, including
any variable-interest entity or similar structure that results in additional foreign entities being consolidated in the registrant’s
financial statements.
The required disclosures include:
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During the period covered by the form, the registered public accounting firm has prepared an audit report for the issuer; |
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The percentage of the shares of the issuer owned by governmental entities in the foreign jurisdiction in which the issuer is incorporated or otherwise organized; |
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Whether governmental entities in the applicable foreign jurisdiction with respect to that registered public accounting firm have a controlling financial interest with respect to the issuer; |
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The name of each official of the Chinese Communist Party who is a member of the board of directors of the issuer or the operating entity with respect to the issuer; and |
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Whether the articles of incorporation of the issuer (or equivalent organizing document) contains any charter of the Chinese Communist Party, including the text of any such charter. |
The SEC will identify a registrant as a Commission-Identified Issuer
as early as possible after the registrant files its annual report and on a rolling basis. The SEC will “provisionally identify”
a registrant as a Commission-Identified Issuer on the SEC’s website at www.sec.gov/HFCAA. For 15 business days after this provisional
identification, a registrant may email the SEC if it believes it has been incorrectly identified, providing evidence supporting its claim.
After reviewing the information, the registrant will be notified whether the SEC will “conclusively identify” the registrant
as a Commission-Identified Issuer.
A Commission-Identified Issuer is a registrant identified by the SEC
as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction
and that the Public Company Accounting Oversight Board (PCAOB) is unable to inspect or investigate completely because of a position taken
by an authority in that jurisdiction (PCAOB-Identified Firm). The SEC will identify such issuers promptly after the filing of their annual
reports by evaluating whether the annual report contains an audit report signed by a PCAOB-Identified Firm. We may be subject to the HFCAA
if we are identified as a "Commission-Identified Issuer" in accordance with such HFCAA amendments.
If the registrant does not contact the SEC to dispute the provisional
identification within 15 business days, the SEC will conclusively identify the registrant as a Commission-Identified Issuer. The SEC will
publish a list on its website identifying Commission-Identified Issuers, indicating the number of years a Commission-Identified Issuer
has been published on the list, and noting whether the Commission-Identified Issuer has been subject to any prior trading prohibitions.
The HFCAA requires the SEC to prohibit the trading of the securities
of certain Commission Identified Issuers on a national securities exchange or through any other method that is within the jurisdiction
of the SEC to regulate, including through over-the-counter trading. As a result, the SEC will impose an initial trading prohibition on
a registrant as soon as practicable after it is conclusively identified as a Commission-Identified Issuer for three consecutive years.
If the SEC ends the initial trading prohibition and, thereafter, the
registrant is again determined to be a Commission-Identified Issuer, the SEC will impose a subsequent trading prohibition on the registrant
for a minimum of five years. To end an initial or subsequent trading prohibition, a Commission-Identified Issuer must certify that it
has retained or will retain a registered public accounting firm that the PCAOB has determined it is able to inspect or investigate. To
make that certification, the Commission-Identified Issuer must file financial statements that include an audit report signed by such a
registered public accounting firm.
We are not currently subject to the determination announced by the
PCAOB on December 16, 2021 since our auditor is located in the United States.
We will be subject to differing and sometimes conflicting laws and
regulations in the various China jurisdictions if and when we implement our contemplated business plan. As the carbon neutrality and air
purification is still at a relatively early stage of development, new laws and regulations may be adopted from time to time to address
new issues that come to the authorities' attention. In addition, considerable uncertainties still exist with respect to the interpretation
and implementation of existing laws and regulations governing our contemplated business activities. A large number of proposals are before
various national, regional, and local legislative bodies and regulatory entities regarding issues related to our industry or our business
model. As we implement our business plan and expand into new cities or countries or as we add new products and services to our platform,
we may become subject to additional laws and regulations that we are not subject to now. Existing or new laws and regulations could expose
us to substantial liability, including significant expenses necessary to comply with such laws and regulations, and could dampen our growth,
which could adversely affect our business and results of operations.
The Chinese government could rule that the structure is against public
policy and this ruling would likely result in a material change in our contemplated operations. Furthermore, the value of our common stock
may decline or become worthless, and the shareholder could lose their entire investment.
If we implement the VIE structure, our contemplated
VIE will hold certain assets that may be critical to the operation of our business. If the shareholders of our contemplated VIEs breach
the contractual arrangements and voluntarily liquidate our contemplated VIEs, or if our contemplated VIEs declare bankruptcy and all or
part of its assets become subject to liens or rights of third-party creditors or are otherwise disposed of without our consent, we may
be unable to continue some or all of our business activities, which could materially and adversely affect our business, financial condition
and results of operations. In addition, if any of our contemplated VIEs undergoes an involuntary liquidation proceeding, third-party creditors
may claim rights to some or all of its assets, thereby hindering our ability to operate our business, which could materially or adversely
affect our business, financial condition and results of operations. See Item 1.A Risk Factors: Risks Related to the Company’s Organizational
Structure.
Recent statements and regulatory actions by the Chinese government
have addressed the issue of anti-monopoly concerns. Where a business operator’s abuse of intellectual property rights to exclude
or restrict competition constitutes a monopoly agreement, the anti-monopoly law enforcement agency shall order it to stop the illegal
activity, confiscate the illegal income, and impose fines. Upon execution of our business plan through a merger with an operating company,
RTAS will be subject to anti-monopoly laws and, if found in violation, our stock price could decline or become worthless.
It will be difficult for investors to assert claims against China-based
issuers, including their officers, directors, and agents and it may be challenging for investors to pursue their claims in U.S. courts.
Even if an investor secures a judgment, the investor may still be unable to enforce it in China.
In addition, the assertion of new regulation by the Chinese government
could our ability to continue to offer securities to foreign investors and hinder our ability to execute of our business merger plan.
China may be subject to considerable degrees of economic, political
and social instability. Investments in securities of Chinese issuers involve risks that are specific to China, including regulatory, liquidity
and enforcement risks.
Regulatory cycles are not uncommon in China. Policy and regulatory
scrutiny should be seen as ongoing risks when it comes to investing in China. The revised Chinese regulations have not ruled on for our
industry. We are not currently engaged in a VIE structure, however that could change moving forward.
We will subject to differing and sometimes
conflicting laws and regulations in the various China jurisdictions if, and when, we merge with a Photovoltaic solar energy. In addition,
considerable uncertainties still exist with respect to the interpretation and implementation of existing laws and regulations governing
business activities in China. If, and when, we merge with a Photovoltaic solar energy company we may expand into new cities or countries
or and add new products and services, we may become subject to additional laws and regulations that we are not subject to now. Existing
or new laws and regulations could expose us to substantial liability, including significant expenses necessary to comply with such laws
and regulations, and could dampen our growth, which could adversely affect our business and results of future operations. See Item 1.A
Risk Factors: Our Business is Subject to Numerous Legal and Regulatory Risks that Could Have an Adverse Impact on Our Contemplated Business.
China’s legal system is substantially
different from the legal system in the United States and may raise risks and uncertainties concerning the intent, effect, and enforcement
of its laws, rules, and regulations, including those that restrict the inflow and outflow of foreign capital or provide the Chinese government
with significant authority to exert influence on a China-based Issuer’s ability to conduct business or raise capital. This lack
of certainty may result in the inconsistent and unpredictable interpretation and enforcement of laws, rules, and regulations, which may
change quickly. China-based Issuers face risks related to evolving laws and regulations, which could impede our ability to obtain or maintain
permits or licenses required to conduct business in China. In the absence of required permits or licenses, governmental authorities may
impose material sanctions or penalties on the company. Such actions could significantly limit or completely hinder our ability to offer
or continue to offer securities to investors and cause the value of our securities to significantly decline or be worthless. See Item
1.A Risk Factors: Risks Related to the Regulatory Environment.
Our contemplated
operations are governed by the China Securities Regulatory Commission (“CSRC”) and Cyber Administration of China (“CAC”).
CAC oversees data security and recently revised its laws to include
operators that possess personal information for over one million individuals would be subject to cybersecurity when listing of foreign
exchanges. Personal information is defined in Article 76(5) of Cybersecurity Law as various information which is recorded in electronic
or any other form and used alone or in combination with other information to recognize the identity of a natural person, including but
not limited to name, date of birth, ID number, personal biological identification information, address and telephone number of natural
persons.
As we have not implemented a business plan, RTAS does not meet the
criteria to trigger the CAC revised rule. However, we anticipate that, upon executing a business combination by merging with an existing
entity, we will be subject to CAC rules and regulations. Our operations could be suspended if the CAC finds we are in violation of data
security laws. See Item 1.A Risk Factors: Greater Chinese Regulatory Oversight May Impact our Contemplated
Business.
The CRSC oversees China's nationwide centralized securities supervisory
system, with the power to regulate and supervise securities issuers, as well as to investigate, and impose penalties for illegal activities
related to securities and futures. China based companies listed on the OTC Markets may be required to request approval from CSRC to continue
listing on this market. As of this time, our current quotation on OTC Markets is permissible without such approval.
CSRC is responsible for the examination and approval, as well as supervision
and administration of foreign-invested securities companies. Our Company is not currently required to submit information to the CSRC,
however RTAS may be required to comply with CSRC regulation in the future. As such, we may be required to submit information about our
contemplated business to CRSC for approval and would be subject to continued compliance. If we become noncompliant with CRSC rules, our
business operations could be suspended. In addition, the CRSC could deny us permission as an issuer to foreign investors if it is ruled
that VIE’s are illegal.
As of this time, we are not required to submit and have not submitted
information to CSRC that is required to list on OTC Markets but will comply with the request in the future.
Moving forward, RTAS may be subject to CRSC rules and regulations and
has not received approval at this time. As such, we will be required to submit information about our future contemplated business to CRSC
for approval and will be subject to continued compliance. In addition, if we decide to implement a VIE structure, the CRSC could deny
us permission as an issuer to foreign investors if it is ruled that VIE’s are illegal. The value of our stock could decline or become
worthless and RTAS could be delisted as a result of not complying with CRSC rules.
Under the PRC Anti-monopoly Law, merger & acquisitions that meet
certain turnover thresholds must notify the State Administration for Market Regulation (SAMR) for merger control clearance and may not
be implemented without SAMR’s approval.
RTAS plans to merge with, or acquire, a target company to commence
its business operations. If our target business meets the threshold for review by SAMR, we will be required to submit an application for
approval.
The SAMR utilizes a substantive test for merger review. The substantive
test takes into consideration the:
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Market shares and market control power of the business operators concerned |
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Concentration levels of relevant markets |
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Impact of the concentration on market entry, technological development, consumers and other relevant operators |
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Impact of the concentration on national economic development |
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Foreign investment |
As of this time, RTAS is not required to submit an application to SAMR
as we have not identified a merger or acquisition candidate. However, if we locate a suitable merger or acquisition candidate, we may
be required to submit an approval request to SAMR. IF SAMR denies our application, we could face monetary penalties or delisting of our
securities. Such actions would significantly limit or completely hinder our ability to offer, or continue to offer, securities to investors
and cause the value of such securities to significantly decline or be worthless.
RTAS plans to conduct operations in China and may acquire Chinese companies
as subsidiaries to carry out its future plan of business. Daily operations in PRC may include purchase of raw materials, manufacturing,
selling, hiring labor forces, and R&D. Cash associated with these activities will circulate in PRC in the form of local currency.
Activities such as raising capitals to support PRC operations, hiring US employees, paying for working capital, and paying out dividends
will involve cross-border payments.
Cross-border payments must comply
with the relevant regulation of the China State Administration of Foreign Exchange (SAFE). PRC adopts a partial foreign exchange administration.
Foreign currency is forbidden to circulate within the territory. It allows exchange and payment on current accounts such as trading while
implementing certain controls on capital accounts such as investment. Shanghai Free-Trade Zone even implements a more relaxed policy.
Payrolls and working capitals
are on current accounts. Investment and dividends payment will be on capital accounts. We may face obstacles even if transactions are
legal and reasonable after proper registration. So far, RTAS has not established a VIE nor has determined the corporate structure. However,
RTAS might also set up a structure to fully utilize the more relaxed policy in Free-Trade Zone to minimize the restrictions. There have
been no transfers, dividends, or distributions as of this date.
In compliance with US laws, PRC
laws and regulations, RTAS may implement a VIE and will be required to work out financial plans to establish cash flow to the parent company,
subsidiaries and VIE regarding daily operation and dividends pay out.
However, we could be restricted
by PRC laws. There is no guarantee that cash will be distributed from businesses, including contemplated subsidiaries and/or consolidated
VIEs, to the parent company. There is also no guarantee we will have the ability to settle amounts owed under the contemplated VIE agreements.
If we merge or acquire a company located in China we will subject to
extensive national, provincial, and local governmental regulations, policies and controls. Central governmental authorities and provincial
and local authorities and agencies regulate many aspects of Chinese industries, including without limitation, among others and in addition
to specific industry-related regulations, the following aspects:
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banking regulations |
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environmental protection laws and regulations; |
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security laws and regulations; |
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establishment of or changes in shareholder of foreign investment enterprises; |
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foreign exchange; |
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taxes, duties and fees; |
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cyber security and information protection laws and regulations |
The liabilities, costs, obligations, and requirements associated with
these laws and regulations may be material, may delay the commencement of operations. Failure to comply with the relevant laws and regulations
in our contemplated operations may result in various penalties, and thus adversely and materially affect our business, prospects, and
financial condition. While we plan to comply with the relevant laws and regulations in the development and operation of our contemplated
business combination, we may incur additional costs in order to fulfill such requirements, and we cannot assure you that we have complied
with or will comply with the requirements of all relevant laws and regulations. Additionally, there can be no assurance that the relevant
government agencies will not change such laws or regulations or impose additional or more stringent laws or regulations. We cannot assure
you that we will comply with the requirements of all new laws and regulations. Compliance with such laws or regulations may require us
to incur material capital expenditures or other obligations or liabilities.
Furthermore, if future legislations mandate further actions to be taken
by companies, we may face substantial uncertainties as to whether we can complete such actions in a timely manner, or at all. If we fail
to take appropriate and timely measures to comply with any of these or similar regulatory compliance requirements, our current corporate
structure, corporate governance and business operations could be materially and adversely affected.
In summary, RTAS has no business operations and does not currently
have a VIE structure in place. We have no intentions on implementing a VIE structure at this time, however, additional regulations by
the Chinese government may necessitate our company moving to a VIE structure. Any actions by the Chinese government to exert more oversight
and control over offerings that are conducted overseas and/or foreign investment in China-based issuers could significantly limit or completely
hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline
or be worthless.
CSRC, CAC, SAMR, PRC and other governmental agencies may be required
to approve our contemplated VIE’s operations, if implemented. At this time, we are not required to receive permission or approvals
from these agencies. If we implement a VIE structure, we could be required to receive approval from Chinese government agencies and if
we are denied permission, or become noncompliant our company could be fined, and our securities could be suspended or delisted. Applicable
laws, regulations, and interpretations change, and we may be required to obtain such permissions or approvals in the future. As of this
time, RTAS has not received permissions or approvals from CSRC, CAC, SAMR, PRC or any other governmental agencies.
Risks and uncertainties regarding the enforcement of laws and that
rules and regulations in China can change quickly with little advance notice; and the risk that the Chinese government may intervene or
influence our operations at any time or may exert more control over offerings conducted overseas and/or foreign investment in China-based
issuers, which could result in a material change in our operations and/or the value of our securities.
(a) Business Development
The Company was organized under the laws of the State of Nevada on
January 5, 2005, under the name File4ward Software, Inc. The Company changed its name to RNS Software, Inc. on March 16, 2005. The Company
was a development stage company in the
business of developing and marketing a search engine optimization software.
Business
operations for REDtone Asia, Inc. and its subsidiaries were abandoned by former management and a custodianship action, as described in
the subsequent paragraph, was commenced in 2019. The Company filed its last 10-Q in 2016, this financial report included liabilities
and debts. As of the date of this filing, these liabilities and debts have been addressed and the legal opinion for debt write
off is attached as an Exhibit.
On April 23, 2019, the Eighth
District Court of Clark County, Nevada granted the Application for Appointment of Custodian as a result of the absence of a functioning
board of directors and the revocation of the Company’s charter. The order appointed Small Cap Compliance, LLC (“SCC”,
the “Custodian”) custodian with the right to appoint officers and directors, negotiate and compromise debt, execute contracts,
issue stock, and authorize new classes of stock. Rhonda Keaveney is the control person for Small Cap Compliance, LLC.
The court awarded custodianship to SCC based on the absence of a functioning
board of directors, revocation of the company’s charter, and abandonment of the business. At this time, Michael Dobbs was appointed
sole officer and director.
The Company was severely delinquent in filing annual reports for the
Company’s charter. The last quarterly report was filed on July 31, 2016 on Form 10-Q. In addition, the company was subject to Exchange
Act reporting requirements including filing 10Q’s and 10Ks. The Company was out of compliance with Exchange Act reporting. SCC attempted
to contact the Company’s officers and directors through letters, emails, and phone calls, with no success.
SCC was a shareholder in the Company and applied to the Court for an
Order appointing SCC as the Custodian. This application was for the purpose of reinstating RTAS’s corporate charter to do business
and restoring value to the Company for the benefit of the stockholders.
SCC performed the following actions in its capacity as custodian:
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Funded any expenses of the company including paying off outstanding liabilities |
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Brought the Company back into compliance with the Nevada Secretary of State, resident agent, transfer agent |
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Appointed officers and directors and held a shareholders meeting |
The Custodian paid the following expenses
on behalf of the company:
Nevada Secretary of State for reinstatement of the Company, $4,160
Amended and Restated Articles of Incorporation for the Company, $175
Shareholders Meeting $500
Upon appointment as the Custodian of RTAS
and under its duties stipulated by the Nevada court, SCC took initiative to organize the business of the issuer. As Custodian, the duties
were to conduct daily business, hold shareholder meetings, appoint officers and directors, reinstate the company with the Nevada Secretary
of State. SCC also had authority to enter into contracts and find a suitable merger candidate. SCC was compensated for its role as custodian
in the amount of $30,000. SCC did not receive any additional compensation, in the form of cash or stock, for custodian services. The custodianship
was discharged on August 14, 2019.
On May 22, 2019, SCC entered into a Convertible
Note with Bridgeview Capital Partners, LLC, whereby Bridgeview Capital Partners LLC paid SCC $30,000 for custodian services and payment
of company debt and 1,700,000 shares of Convertible Series A Preferred Stock. These shares represent the controlling block of stock. Michael
Dobbs and Sean Larson are control persons for Bridgeview Capital Partners, LLC.
In November 2021, Bridgeview Capital Partners,
LLC entered into a Stock Purchas Agreement with Yang Chong Yi whereby Yang Chong Yi purchased 1,700,000 shares of Convertible Series
A Preferred Stock for $85,000. Michael Dobbs resigned as sole officer and director and appointed Yang Chong Yi as its CEO, Treasurer,
Secretary, and Director of the Company.
(b) Business of Issuer
Since 2019, the Company’s operations consist of a search for
a merger, acquisition, reverse merger or a business transaction opportunity with an operating business or other financial transaction;
however, there can be no assurance that this plan will be successfully implemented. Until a transaction is effectuated, the Company does
not expect to have significant operations and plans to acquire a business in Photovoltaic solar energy, energy storage equipment
and charging piles. At this time, the Company has no arrangements or understandings with respect to any potential merger, acquisition,
reverse merger or business combination candidate pursuant to which the Company may become an operating company.
Opportunities may come to the Company’s attention from various
sources, including our management, our stockholders, professional advisors, securities broker dealers, venture capitalists and private
equity funds, members of the financial community and others who may present unsolicited proposals. At this time, the Company has no plans,
understandings, agreements, or commitments with any individual or entity to act as a finder in regard to any business opportunities. While
it is not currently anticipated that the Company will engage unaffiliated professional firms specializing in business acquisitions, reorganizations
or other such transactions, such firms may be retained if such arrangements are deemed to be in the best interest of the Company. Compensation
to a finder or business acquisition firm may take various forms, including one-time cash payments, payments involving issuance of securities
(including those of the Company), or any combination of these or other compensation arrangements. Consequently, the Company is currently
unable to predict the cost of utilizing such services.
The Company has restricted its search to the
business of Photovoltaic solar energy, energy storage equipment and charging piles. In evaluating a potential transaction, the
Company analyzes all available factors and make a determination based on a composite of available facts, without reliance on any single
factor.
It is not possible at this time to predict the nature of a transaction
in which the Company may participate. Specific business opportunities would be reviewed as well as the respective needs and desires of
the Company and the legal structure or method deemed by management to be suitable would be selected. In implementing a structure for a
particular transaction, the Company may become a party to a merger, consolidation, reorganization, tender offer, joint venture, license,
purchase and sale of assets, or purchase and sale of stock, or other arrangement the exact nature of which cannot now be predicted. Additionally,
the Company may act directly or indirectly through an interest in a partnership, corporation or other form of organization. Implementing
such structure may require the merger, consolidation, or reorganization of the Company with other business organizations and there is
no assurance that the Company would be the surviving entity. In addition, our present management and stockholders may not have control
of a majority of the voting shares of the Company following reorganization or other financial transaction. As part of such a transaction,
some or all of the Company’s existing directors may resign and new directors may be appointed. The Company’s operations following
the consummation of a transaction will be dependent on the nature of the transaction. There may also be various risks inherent in the
transaction, the nature and magnitude of which cannot be predicted.
The Company may also be subject to increased US
and China governmental regulations following a transaction; however, it is not possible at this time to predict the nature or magnitude
of such increased regulation, if any.
The Company expects to continue to incur moderate
losses each quarter until a transaction considered appropriate by management is effectuate.
At present financial revenue has not yet been realized. The Company
hopes to raise capital in order to fund the acquisitions.
All statements involving our business plan are forward looking statements
and have not been implemented as of this filing.
The
Company is moving in a new direction, statements made relating to our contemplated business combination are forward looking statements
and we have no history of performance. Current management does not have any experience in acquisition of companies but is actively
looking for a suitable person to incorporate into the management team.
The analysis will be undertaken by or under
the supervision of our management. As of the date of this filing, we have not entered into definitive agreements. In our continued efforts
to analyze potential merger candidates, we intend to consider the following factors:
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Potential for growth, indicated by anticipated market expansion or new technology; |
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Competitive position as compared to other businesses of similar size and experience within our contemplated segment as well as within the industry as a whole; |
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Strength and diversity of management, and the accessibility of required management expertise, personnel, services, professional assistance and other required items; |
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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 or convertible debt, through joint ventures or similar arrangements or from other sources; |
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The extent to which the business opportunity can be advanced in our contemplated marketplace; and |
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Other relevant factors |
In applying the foregoing criteria, management
will attempt to analyze all factors and circumstances and make a determination based upon reasonable investigative measures and available
data. Due to our limited capital available for investigation, we may not discover or adequately evaluate adverse facts about the opportunity
to be acquired. Additionally, we will be competing against other entities that may have greater financial, technical, and managerial capabilities
for identifying and completing our contemplated business plan to merge with a company operating in the Photovoltaic solar energy industry.
We are unable to predict when we will, if
ever, identify and implement a business plan. We anticipate that a proposed merger candidate would be made available to us through personal
contacts of our directors, officers and principal stockholders, professional advisors, broker-dealers, venture capitalists, members of
the financial community and others who may present unsolicited proposals. In certain cases, we may agree to pay a finder’s fee or
to otherwise compensate the persons who introduce the Company to business opportunities in which we participate.
We expect that our due diligence will encompass,
among other things, meetings with incumbent management of the target business and inspection of its facilities, as necessary, as well
as a review of financial and other information, which is made available to the Company. This due diligence review will be conducted either
by our management or by third parties we may engage. We anticipate that we may rely on the issuance of our common stock in lieu of cash
payments for services or expenses related to any analysis.
We may incur time and costs required to select
and evaluate our business structure and complete a merger, which cannot presently be determined with any degree of certainty. Any costs
incurred with respect to the indemnification and evaluation of a prospective business that is not ultimately completed may result in a
loss to the Company. These fees may include legal costs, accounting costs, finder’s fees, consultant’s fees and other related
expenses. We have no present arrangements for any of these types of fees.
We anticipate 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, consultants, and others. Costs
may be incurred in the investigation process, which may 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 a loss to the Company of the related costs
incurred.
As of the time of this filing, the Company
has not implemented a business combination. Our plan is to implement a business combination by merging with, or acquiring, an operating
entity that offers opportunities in the Photovoltaic solar energy industry,
energy storage equipment and charging piles. We are actively looking for a suitable merger candidate and evaluating potential target companies
that align with our business needs. This will require review of financials, products and management of the merger candidate. We anticipate
the review process could take up to 30 days after a viable candidate is located.
Competition
REDTone Asia, Inc. is in direct competition
with many other entities in its efforts to locate a suitable merger candidate. Included in the competition are business development companies,
special purpose acquisition companies (“SPACs”), venture capital firms, small business investment companies, venture capital
affiliates of industrial and financial companies, broker-dealers and investment bankers, management consultant firms and private individual
investors. Many of these entities possess greater financial resources and are able to assume greater risks than those which REDTone Asia,
Inc. could consider. Many of these competing entities also possess significantly greater experience and contacts than REDTone Asia, Inc.’s
management. Moreover, the Company also competes with numerous other companies similar to it for such opportunities.
Effect of Existing or Probable Governmental
Regulations on the Business
Upon effectiveness of this Form 10, we will
be subject to the Exchange Act and the Sarbanes-Oxley Act of 2002. Under the Exchange Act, we will be required to file with the SEC annual
reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. The Sarbanes-Oxley Act creates a strong and independent
accounting oversight board to oversee the conduct of auditors of public companies and to strengthen auditor independence. It also (1)
requires steps be taken to enhance the direct responsibility of senior members of management for financial reporting and for the quality
of financial disclosures made by public companies; (2) establishes clear statutory rules to limit, and to expose to public view, possible
conflicts of interest affecting securities analysts; (3) creates guidelines for audit committee members’ appointment, and compensation
and oversight of the work of public companies’ auditors; (4) prohibits certain insider trading during pension fund blackout periods;
and (5) establishes a federal crime of securities fraud, among other provisions.
We will also be subject to Section 14(a) of
the Exchange Act, which requires all companies with securities registered pursuant to Section 12(g) of the Exchange Act to comply with
the rules and regulations of the SEC regarding proxy solicitations, as outlined in Regulation 14A. Matters submitted to our stockholders
at a special or annual meeting thereof or pursuant to a written consent will require us to provide our stockholders with the information
outlined in Schedules 14A or 14C of Regulation 14A. Preliminary copies of this information must be submitted to the SEC at least 10 days
prior to the date that definitive copies of this information are provided to our stockholders.
Employees
As of this filing, we had one officer and
director. We anticipate that we will begin to fill out our management team as and when we raise capital to begin implementing our business
plan. In the interim, we will utilize independent consultants to assist with accounting and administrative matters. We currently have
no employment agreements and believe our consulting relationships are satisfactory. We plan to continue to hire independent consultants
from time to time on an as-needed basis.
Risks Relating to Our Business
Our
contemplated business plan involves a number of very significant risks. Our future business operating results and financial condition
could be seriously harmed as a result of the occurrence of any of the following risks. You could lose all or part of your investment due
to any of these risks. You should invest in our common stock only if you can afford to lose your entire investment.
Our officers and directors
reside outside the United States, investors may have limited legal recourse against them including difficulties in enforcing judgments
made against them by U.S. courts. There is neither treaty nor any reciprocal arrangement between China and the United States regarding
recognition or enforcement of civil judgments.
Recent statements by the Chinese government indicate an intent to exert
more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers. Such actions could
significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such
securities to significantly decline or be worthless.
RTAS may implement a VIE structure in the future if our operations
are located in China. If the PRC government determines that the contractual arrangements constituting part of our VIE structure does not
comply with PRC regulations, or if these regulations change or are interpreted differently in the future, our shares may decline in value
or be worthless if we are unable to assert our contractual control rights over the assets of our PRC subsidiaries that may conduct all
or substantially all of our contemplated future operations.
We are not currently required to comply with regulations and policies
of the CAC because we have not commenced a business in China.
CAC regulates the collection of personal information, which is recorded
electronically, or in any other form, to recognize the identity of a natural person. In light of greater oversight regarding the collection
of personal information we will be subject to cybersecurity review upon execution of our contemplated business plan.
Our potential business plan, Photovoltaic
solar energy, energy storage equipment and charging piles, will have operations in China and will be subject to cybersecurity review.
We face uncertainties as to whether such clearance can be timely obtained, or at all, and we may incur additional time delays to complete
any anticipated acquisitions.
In light of
greater oversight by CAC for companies seeking to list on a foreign exchange, target business combinations could be impacted. If CAC
determines our target business does not meet its requirements, our ability to implement our business plan will be greatly affected.
If CAC determines that we have violated any portion of PRC laws and
regulation, our ability to obtain or maintain permits or licenses required to conduct business in China may be affected. In the absence
of required permits or licenses, governmental authorities may impose material sanctions or penalties on the company. Such actions could
significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our
securities to significantly decline or be worthless.
Our Auditor is U.S based, registered with the PCAOB, and is subject
to PCAOB inspections
The Holding Foreign Companies Accountable Act (“HFCAA”)
became law in December 2020 and prohibits foreign companies from listing their securities on U.S. exchanges if the auditor has been unavailable
for PCAOB inspection or investigation for three consecutive years.
The HFCAA requires the SEC to identify registrants that have retained
a registered public accounting firm to issue an audit report where that registered public accounting firm has a branch or
office that:
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Is located in a foreign jurisdiction; and |
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The PCAOB has determined that it is unable to inspect or investigate completely because of a position taken by an authority in the foreign jurisdiction |
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As reflected on the PCAOB's website, the
PCAOB is currently unable to inspect or investigate accounting firms due to a position of the local authority in two jurisdictions: China
and Hong Kong |
If the PCAOB is unable to inspect the issuer's public accounting firm
for three consecutive years, the issuer's securities are banned from trade on a national exchange or through other methods. The United
States Senate passed the Accelerating Holding Foreign Companies Accountable Act, which, if enacted, would decrease the number of non-inspection
years from three years to two years.
There are material risks to the issuer and its investors if it is determined
that the PCAOB is unable to inspect our auditor because of a position taken by an authority in a foreign jurisdiction. The inability to
thoroughly inspect or investigate our auditor may cause trading in our securities to be prohibited and an exchange may determine to delist
our securities. As a result, our securities could be delisted rendering
our stock worthless.
BF Borgers CPA PC, PCAOB ID 5041, is our current auditor, located in
the United States, and their offices and the PCAOB has the ability to inspect their offices.
We are a blank check company
REDtone, Inc. is a Blank Check Company as defined by Securities Act
Rule 419(a)(2):
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For purposes
of this section, the term “blank check company” shall mean a company that: |
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(i) Is a development stage company 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; and |
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(ii) Is issuing “penny stock,” as defined in Rule 3a51-1 (17 CFR 240.3a51-1) under the Securities Exchange
Act of 1934 (“Exchange Act”). |
As of this filing, RTAS has no business plan
and hopes to acquire a business in Photovoltaic solar energy, energy storage equipment and charging piles. RTAS hopes to raise
sufficient capital to locate a suitable merger candidate.
The PRC Anti-monopoly Law Requires
Approval for Merger & Acquisition
Under the PRC Anti-monopoly Law, merger & acquisitions that meet
certain turnover thresholds must notify the State Administration for Market Regulation (“SAMR”) for merger control clearance
and may not be implemented without SAMR’s approval.
RTAS may merge with, or acquire, a target company to commence its business
operations. If our target business meets the threshold for review by SAMR, Ministry of Commerce (“MOFCOM”), and other national
security laws. We will be required to submit applications for review to these regulatory agencies.
The SAMR utilizes a substantive test for merger
review. The substantive test takes into consideration the:
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Market shares and market control power of the business operators concerned |
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Concentration levels of relevant markets |
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Impact of the concentration on market entry, technological development, consumers and other relevant operators |
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Impact of the concentration on national economic development |
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Foreign investment |
If the merger or acquisition does not meet the SAMR criteria, our application
will be denied.
Such action could significantly limit or completely
hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline
or be worthless.
MOFCOM requires the disclosure of the control persons, defined as any
natural person, enterprise, government authority, or international organization that ultimately exercises control over a foreign investment
enterprise directly or indirectly through equity interests, contract, trust, or any other means. China has escalated the national security
review system (“NSR”) as requested by the MOFCOM. China expanded the scope of its national security review to capture transactions
between two foreign parties involving a Chinese company or Chinese interests in conjunctions with PRC Foreign Investment Law and its implementation
regulations.
In addition to the NSR system,
MOFCOM promulgated the Provisions on the Unreliable Entity List (UEL), under which foreign individuals and entities who are on the UEL
may be restricted or prohibited from investing in China. RTAS is not on the list of as this time and the list is constantly changing.
Actions by the Chinese government to exert more oversight and control
over offerings that are conducted overseas and/or foreign investment in China-based issuers could significantly limit or completely hinder
our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or be
worthless.
Our business is subject to conflicting
laws and regulations in China
We are subject to differing and sometimes conflicting laws and regulations
in the various China jurisdictions where we provide our services. New laws and regulations may be adopted from time to time to address
new issues that come to the authorities' attention. In addition, considerable uncertainties still exist with respect to the interpretation
and implementation of existing laws and regulations governing our contemplated business activities. A large number of proposals are before
various national, regional, and local legislative bodies and regulatory entities regarding issues related to our industry or our business
model. If we merge with a Photovoltaic solar energy business and implement a business plan we may expand into new cities or countries
or add new products and services to our platform. We may become subject to additional laws and regulations that we are not subject to
now. Existing or new laws and regulations could expose us to substantial liability, including significant expenses necessary to comply
with such laws and regulations, and could dampen our growth, which could adversely affect our business and results of operations. Such
action could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the
value of such securities to significantly decline or be worthless.
Risks related to PRC Securities Law
that prevent access to information and regulatory oversight of U.S. authorities
PRC Securities Law state that no overseas securities regulator can
directly conduct investigations or evidence collection activities within the PRC and no entity or individual in China may provide documents
and information relating to securities business activities to overseas regulators without Chinese government approval. The SEC, U.S. Department
of Justice, and other U.S. authorities face substantial challenges in bringing and enforcing actions against China-based Issuers and their
officers and directors. As a result, investors in China-based Issuers may not benefit from a regulatory environment that fosters effective
enforcement of U.S. federal securities laws.
Risks related to China’s evolving
regulatory environment
China’s legal system is substantially different from the legal
system in the United States and may raise risks and uncertainties concerning the intent, effect, and enforcement of its laws, rules, and
regulations, including those that restrict the inflow and outflow of foreign capital or provide the Chinese government with significant
authority to exert influence on a China-based Issuer’s ability to conduct business or raise capital. This lack of certainty may
result in the inconsistent and unpredictable interpretation and enforcement of laws, rules, and regulations, which may change quickly.
China-based Issuers face risks related to evolving laws and regulations, which could impede their ability to obtain or maintain permits
or licenses required to conduct business in China. In the absence of required permits or licenses, governmental authorities may impose
material sanctions or penalties on the company. The Chinese government may intervene or influence our operations at any time, which could
result in a material change in our operations and/or the value of our common stock. Such actions could significantly limit or completely
hinder your ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline
or be worthless.
Legal limitations on shareholder rights
and recourse for legal claims
Legal claims, including federal securities law claims, against China-based
Issuers may be difficult or impossible for investors to pursue in U.S. courts. Even if an investor obtains a judgment in a U.S. court,
the investor may be unable to enforce such judgment, particularly in the case of a China-based Issuer, where the related assets or persons
are typically located outside of the United States and in jurisdictions that may not recognize or enforce U.S. judgments. If an investor
is unable to bring a U.S. claim or collect on a U.S. judgment, the investor may have to rely on legal claims and remedies available in
China or other overseas jurisdictions where the China-based Issuer may maintain assets. The claims and remedies available in these jurisdictions
are often significantly different from those available in the United States.
Resale limitations of Rule 144(i) on your shares
According to the Rule 144(i), Rule 144 is not available for the resale
of securities initially issued by either a reporting or non-reporting shell company. Moreover, Rule 144(i)(1)(ii) states that Rule 144
is not available to securities initially issued by an issuer that has been “at any time previously” a reporting or non-reporting
shell company. Rule 144(i)(1)(ii) prohibits shareholders from utilizing Rule 144 to sell their shares in a company that at any time in
its existence was a shell company. However, according to Rule 144(i)(2), an issuer can “cure” its shell status.
To “cure” a company’s current or former shell company
status, the conditions of Rule 144(i)(2) must be satisfied regardless of the time that has elapsed since the public company ceased to
be a shell company and regardless of when the shares were issued. The availability of Rule 144 for resales of shares issued while the
company is a shell company or thereafter may be restricted even after the expiration of the one-year period since it filed its Form 10
information if the company is not current on all of its periodic reports required to be filed within the SEC during the 12 months before
the date of the shareholder’s sale. Thus, the company must file all 10-Qs and 10K for the preceding 12 months and since the filing
of the Form 10, or Rule 144 is not available for the resale of securities.
There is no guarantee that we will have
business operations or that these operations will be profitable, we have extremely limited assets, have incurred operating losses, and
have no current source of revenue
We have had minimal assets and no operations. We do not expect to generate
revenues until we begin to implement a business plan by merging with a Photovoltaic solar energy company. However, we can provide no assurance
that we will produce any material revenues for our stockholders, or that our business will become operational or become profitable.
We will, likely, sustain operating expenses
without corresponding revenues, at least until the consummation of a business plan. This may result in our incurring a net operating loss
that will increase unless we consummate a business plan with a profitable business. We cannot assure you that we can identify a suitable
business combination, or that any such business will be profitable at the time of its acquisition by the Company or ever.
Our auditors have deemed our Company
as a going concern and capital resources may not be sufficient to fund our anticipated future operating needs
We have historically generated negative cash
flow and losses from operations and could experience negative cash flow and losses from operations in the future. Our independent auditors
have included an explanatory paragraph in their report on our financial statements for the fiscal years ended April 30, 2022, and 2021
expressing doubt regarding our ability to continue as a going concern. We currently no cash available, which will not be sufficient to
fund our anticipated future operating needs. The Company will need to raise substantial sums to implement a business plan. There can be
no assurance that the Company will be successful in raising funds. To the extent that the Company is unable to raise funds, we will be
required to reduce our planned operations or cease any operations.
Environmental
laws compliance
As of this filing, we are not subject to environmental
laws.
We may not be able to obtain China’s
regulatory approvals for future business products
Our contemplated business will be subject to China laws and regulations
if we merge with a Chinese company or carry out a business plan in China. The Company believes acquisition of already accredited private
corporations will mitigate some of this risk.
We face a number of risks associated
with a future contemplated business plan, including the possibility that we may incur substantial debt or convertible debt, which could
adversely affect our financial condition
We intend to use reasonable efforts to locate
a merger candidate. We have no operations at this time so our expenses are likely to increase, and it is possible that we may incur substantial
debt or convertible debt in order to complete a merger, which can adversely affect our financial condition. Incurring a substantial amount
of debt or convertible debt may require us to use a significant portion of our cash flow to pay principal and interest on the debt, which
will reduce the amount available to fund working capital, capital expenditures, and other general purposes. Our indebtedness may negatively
impact our ability to operate our business and limit our ability to borrow additional funds by increasing our borrowing costs, and impact
the terms, conditions, and restrictions contained in possible future debt agreements, including the addition of more restrictive covenants;
impact our flexibility in planning for and reacting to changes in our business as covenants and restrictions contained in possible future
debt arrangements may require that we meet certain financial tests and place restrictions on the incurrence of additional indebtedness
and place us at a disadvantage compared to similar companies in our industry that have less debt.
Our future success is highly dependent
on the ability of management to locate and attract suitable business opportunities
At this time, we have no operations and future
implementation of a business plan is highly speculative, there is a consequent risk of loss of an investment in the Company. The success
of our plan of operations will depend to a great extent on the operations, financial condition and management of future business and internal
development. While management intends to seek businesses opportunities with entities having established operating histories, we cannot
provide any assurance that we will be successful in locating opportunities meeting that criterion. In the event we complete a business
plan, the success of our operations will be dependent upon management, its financial position and numerous other factors beyond our control.
There can be no assurance that we will
successfully consummate identify and evaluate suitable business opportunities
We can give no assurance that we will successfully
identify and evaluate suitable business opportunities or that we will successfully implement a business plan. We cannot guarantee that
we will be able to negotiate contracts on favorable terms. No assurances can be given that we will successfully identify and evaluate
suitable business opportunities, that we will conclude a business plan or that we will be able to develop a successful business. Our management
and affiliates will play an integral role in establishing the terms for any future business.
We will incur increased costs as a result
of becoming a reporting company, and given our limited capital resources, such additional costs may have an adverse impact on our profitability.
Following the effectiveness of this Form 10,
we will be an SEC reporting company. The Company currently has no business and no revenue. However, the rules and regulations under the
Exchange Act require a public company to provide periodic reports with interactive data files which will require the Company to engage
legal, accounting and auditing services, and XBRL and EDGAR service providers. The engagement of such services can be costly, and the
Company is likely to incur losses, which may adversely affect the Company’s ability to continue as a going concern. In addition,
the Sarbanes-Oxley Act of 2002, as well as a variety of related rules implemented by the SEC, have required changes in corporate governance
practices and generally increased the disclosure requirements of public companies. For example, as a result of becoming a reporting company,
we will be required to file periodic and current reports and other information with the SEC and we must adopt policies regarding disclosure
controls and procedures and regularly evaluate those controls and process.
The additional costs we will incur in connection
with becoming a reporting company will serve to further stretch our limited capital resources. The expenses incurred for filing periodic
reports and implementing disclosure controls and procedures may be as high as $70,000 USD annually. In other words, due to our limited
resources, we may have to allocate resources away from other productive uses in order to pay any expenses we incur in order to comply
with our obligations as an SEC reporting company. Further, there is no guarantee that we will have sufficient resources to meet our reporting
and filing obligations with the SEC as they come due.
The time and cost of preparing a private
company to become a public reporting company may preclude us from entering into an acquisition or merger with the most attractive private
companies and others
From time to time the Company may come across
target merger companies. These companies may fail to comply with SEC reporting requirements may delay or preclude acquisitions. Sections
13 and 15(d) of the Exchange Act require reporting companies to provide certain information about significant acquisitions, including
certified financial statements for the company acquired, covering one or two years, depending on the relative size of the acquisition.
The time and additional costs that may be incurred by some target entities to prepare these statements may significantly delay or essentially
preclude consummation of an acquisition. Otherwise, suitable acquisition prospects that do not have or are unable to obtain the required
audited statements may be inappropriate for acquisition so long as the reporting requirements of the Exchange Act are applicable.
A business opportunity may result in
a change of control and a change of management
In conjunction with completion of a merger, it is anticipated that
we may issue an amount of our authorized but unissued common or preferred stock which represents the majority of the voting power and
equity of our capital stock, which would result in stockholders of a target company obtaining a controlling interest in us. As a condition
of the business combination agreement, our current stockholders may agree to sell or transfer all or a portion of our common stock as
to provide the target company with all or majority control. The resulting change in control may result in removal of our present officers
and directors and a corresponding reduction in or elimination of their participation in any future affairs.
We depend on our officers and the loss of their services would
have an adverse effect on our contemplated business
We have officers and directors of the Company that are critical to
our chances for success in executing a business combination and merger acquisition. We are dependent on their services to operate our
business and the loss of these persons, or any of them would have an adverse impact on our future operations until such time as he or
she could be replaced, if he could be replaced. We do not have employment contracts or employment agreements with our officers, and we
do not carry key man life insurance on their lives.
Our ability to use our net operating loss carry-forwards and
certain other tax attributes may be limited
We have incurred losses during our history. To the extent that we continue
to generate taxable losses, unused losses will carry forward to offset future taxable income, if any, until such unused losses expire.
Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, if a corporation undergoes an “ownership change,”
generally defined as a greater than 50% change (by value) in its equity ownership over a three-year period, the corporation’s ability
to use its pre-change net operating loss carry-forwards, or NOLs, and other pre-change tax attributes (such as research tax credits) to
offset its post-change income may be limited. We may experience ownership changes in the future because of subsequent shifts in our stock
ownership. As a result, if we earn net taxable income, our ability to use our pre-change net operating loss carryforwards to offset U.S.
federal taxable income may be subject to limitations, which could potentially result in increased future tax liability to us. In addition,
at the state level, there may be periods during which the use of NOLs is suspended or otherwise limited, which could accelerate or permanently
increase state taxes owed.
Our ability to hire and retain key personnel
will be an important factor in the success of our contemplated business and a failure to hire and retain key personnel may result in our
inability to manage and implement a merger and subsequent business plan
We may not be able to attract and retain the
necessary qualified personnel to manage our business. If we are unable to retain or to hire qualified personnel as required, we may not
be able to adequately manage and implement a business plan.
Legal disputes could have an impact on the Company
We plan to engage in business matters that are common to the business
world that can result in disputations of a legal nature. In the event the Company is ever sued or finds it necessary to bring suit
against others, there is the potential that the results of any such litigation could have an adverse impact on the Company.
Our common stock is listed on the OTC MARKETS. An investment
in our common stock is risky and there can be no assurance that the price for our stock will not decrease substantially in the future
Our common stock is not currently trading on any exchange. RTAS is
listed on OTC Markets under the Grey Market tier, meaning there are no available stock price quotes, and you may not buy our stock in
the open market. In the past, the market for our stock has been volatile and has been characterized by large swings in the trading price
that do not appear to be directly related to our business or financial condition. As a result, an investment in our common stock is risky
and there can be no assurance that the price for our stock will not decrease substantially in the future.
Our stock trades below $5.00 per share and is subject to special
sales practice requirements that could have an adverse impact on any trading market that may develop for our stock
If our stock trades below $5.00 per share and is subject to special
sales practice requirements applicable to "penny stocks" which are imposed on broker-dealers who sell low-priced securities
of this type. These rules may be anticipated to affect the ability of broker-dealers to sell our stock, which may in turn be anticipated
to have an adverse impact on the market price for our stock if and when an active trading market should develop.
Our officers, directors and principal stockholders own a large
percentage of our issued and outstanding shares and other stockholders have little or no ability to elect directors or influence corporate
matters
As of October 31, 2021, our officers, directors, and principal stockholders
were deemed to be the beneficial owners of approximately 87.94% of our issued and outstanding shares of common stock after conversion
and 100% of our Preferred A shares. As a result, such persons can determine the outcome of any actions taken by us that require stockholder
approval. For example, they will be able to elect all of our directors and control the policies and practices of the Company.
Risks Related to Our Shareholders and Shares
of Common Stock
There is presently no public market
for our securities and rule 144 is not currently available
Our common stock is not currently trading
on any exchange, and a robust and active trading market may never develop. Because of our current status as a “shell company,”
Rule 144 is not currently available. Future sales of our common stock by existing stockholders pursuant to an effective registration statement
or upon the availability of Rule 144 could adversely affect the market price of our common stock. A shareholder who decides to sell some,
or all, of their shares in a private transaction may be unable to locate persons who are willing to purchase the shares, given the restrictions.
Also, because of the various risk factors described above, the price of the publicly traded common stock may be highly volatile and not
provide the true market price of our common stock.
Our stock is not traded, so you may
be unable to sell your shares at or near the quoted bid prices if you need to sell a significant number of your shares
Even if our stock becomes trading, it is likely
that our common stock will be thinly traded, meaning that the number of persons interested in purchasing our common shares at or near
bid prices at any given time may be relatively small or non-existent. This situation is attributable to a number of factors, including
the fact that we are a small company which is relatively unknown to stock analysts, stock brokers, institutional investors and others
in the investment community that generate or influence sales volume, and that even if we came to the attention of such persons, they tend
to be risk-averse and would be reluctant to follow an unproven company such as ours or purchase or recommend the purchase of our shares
until such time as we became more seasoned and viable.
Consequently, there may be periods of several
days or more when trading activity in our shares is minimal or non-existent, as compared to a seasoned issuer which has a large and steady
volume of trading activity that will generally support continuous sales without an adverse effect on share price. We cannot give you any
assurance that a broader or more active public trading market for our common shares will develop or be sustained, or that current trading
levels will be sustained. Due to these conditions, we can give you no assurance that you will be able to sell your shares at or near bid
prices or at all if you need money or otherwise desire to liquidate your shares.
Our common stock is be considered a
“penny stock,” and thereby be subject to additional sale and trading regulations that may make it more difficult to sell
A common stock is a “penny stock”
if it meets one or more of the following conditions (i) the stock trades at a price less than $5.00 per share; (ii) it is not traded on
a “recognized” national exchange; (iii) it is not quoted on the Nasdaq Capital Market, or even if so, has a price less than
$5.00 per share; or (iv) is issued by a company that has been in business less than three years with net tangible assets less than $5
million.
The principal result or effect of being designated
a “penny stock” is that securities broker-dealers participating in sales of our common stock will be subject to the “penny
stock” regulations set forth in Rules 15g-2 through 15g-9 promulgated under the Exchange Act. For example, Rule 15g-2 requires broker-dealers
dealing in penny stocks to provide potential investors with a document disclosing the risks of penny stocks and to obtain a manually signed
and dated written receipt of the document at least two business days before effecting any transaction in a penny stock for the investor’s
account. Moreover, Rule 15g-9 requires broker-dealers in penny stocks to approve the account of any investor for transactions in such
stocks before selling any penny stock to that investor. This procedure requires the broker-dealer to (i) obtain from the investor information
concerning his or her financial situation, investment experience and investment objectives; (ii) reasonably determine, based on that information,
that transactions in penny stocks are suitable for the investor and that the investor has sufficient knowledge and experience as to be
reasonably capable of evaluating the risks of penny stock transactions; (iii) provide the investor with a written statement setting forth
the basis on which the broker-dealer made the determination in (ii) above; and (iv) receive a signed and dated copy of such statement
from the investor, confirming that it accurately reflects the investor’s financial situation, investment experience and investment
objectives. Compliance with these requirements may make it more difficult and time consuming for holders of our common stock to resell
their shares to third parties or to otherwise dispose of them in the market or otherwise.
We may issue more shares in an acquisition
or merger, which will result in substantial dilution
Our Articles of Incorporation, as amended, authorize the Company to
issue an aggregate of 2,000,000,000 shares of common stock of which 325,038,356 shares are currently outstanding and 5,000,000 shares
of Preferred Stock are authorized, of which 1,700,000 shares are outstanding. Any acquisition or merger effected by the Company may result
in the issuance of additional securities without stockholder approval and may result in substantial dilution in the percentage of our
common stock held by our then existing stockholders. Moreover, shares of our common stock issued in any such merger or acquisition transaction
may be valued on an arbitrary or non-arm’s-length basis by our management, resulting in an additional reduction in the percentage
of common stock held by our then existing stockholders. In an acquisition type transaction, our Board of Directors has the power to issue
any, or all, of such authorized but unissued shares without stockholder approval. To the extent that additional shares of common stock
are issued in connection with a business combination or otherwise, dilution to the interests of our stockholders will occur and the rights
of the holders of common stock might be materially adversely affected.
Obtaining additional capital though
the sale of common stock will result in dilution of stockholder interests
We may raise additional funds in the future
by issuing additional shares of common stock or other securities, which may include securities such as convertible debentures, warrants
or preferred stock that are convertible into common stock. Any such sale of common stock or other securities will lead to further dilution
of the equity ownership of existing holders of our common stock. Additionally, the existing conversion rights may hinder future equity
offerings, and the exercise of those conversion rights may have an adverse effect on the value of our stock. If any such conversion rights
are exercised at a price below the then current market price of our shares, then the market price of our stock could decrease upon the
sale of such additional securities. Further, if any such conversion rights are exercised at a price below the price at which any stockholder
purchased shares, then that particular stockholder will experience dilution in his or her investment.
Our directors have the authority to
authorize the issuance of preferred stock
Our Articles of Incorporation, as amended,
authorize the Company to issue an aggregate of 5,000,000 shares of Preferred Stock, 2,000,000 designated as Series A Preferred Stock and
1,700,000 issued and outstanding. Our directors, without further action by our stockholders, have the authority to issue shares to be
determined by our board of directors of Preferred Stock with the relative rights, conversion rights, voting rights, preferences, special
rights, and qualifications as determined by the board without approval by the shareholders. Any issuance of Preferred Stock could adversely
affect the rights of holders of common stock. Additionally, any future issuance of preferred stock may have the effect of delaying, deferring,
or preventing a change in control of the Company without further action by the shareholders and may adversely affect the voting and other
rights of the holders of common stock. Our Board does not intend to seek shareholder approval prior to any issuance of currently authorized
stock, unless otherwise required by law or stock exchange rules.
We have never paid dividends on our
common stock, nor are we likely to pay dividends in the foreseeable future. Therefore, you may not derive any income solely from ownership
of our stock
We have never declared or paid dividends on
our common stock and do not presently intend to pay any dividends in the foreseeable future. We anticipate that any funds available for
payment of dividends will be re-invested into the Company to further our business strategy. This means that your potential for economic
gain from ownership of our stock depends on appreciation of our stock price and will only be realized by a sale of the stock at a price
higher than your purchase price.
As of April 30, 2023, our officers, directors, and principal stockholders
were deemed to be the beneficial owners of approximately of our 100% issued and outstanding shares of Preferred shares. These shares are
convertible into 1,595,000,000,000 shares of common stock and represents approximately 81% of our issued and outstanding common shares.
As a result, such persons can determine the outcome of any actions taken by us that require stockholder approval. For example, they will
be able to elect all of our directors and control the policies and practices of the Company.
Item 2. |
Financial Information |
Management’s Discussion and Analysis
or Plan of Operation
Upon effectiveness of this Registration Statement,
we will file with the SEC annual and quarterly information and other reports that are specified in the Securities Exchange Act of 1934,
as amended (the “Exchange Act”), and SEC regulations. Thus, we will need to ensure that we will have the ability to prepare,
on a timely basis, financial statements that comply with SEC reporting requirements following the effectiveness of this registration statement.
We will also become subject to other reporting and corporate governance requirements, including the listing standards of any securities
exchange upon which we may list our Common Stock, and the provisions of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”),
and the regulations promulgated hereunder, which impose significant compliance obligations upon us. As a public company, we will be required,
among other things, to:
|
· |
Prepare and distribute reports and other stockholder communications in compliance with our obligations under the federal securities laws and the applicable national securities exchange listing rules; |
|
|
|
|
· |
Define and expand the roles and the duties of our Board of Directors and its committees; |
|
|
|
|
· |
Institute more comprehensive compliance, investor relations and internal audit functions; |
|
|
|
|
· |
Involve and retain outside legal counsel and accountants in connection with the activities listed above. |
Management for each year commencing with the year ending December 31,
2021 must assess the adequacy of our internal control over financial reporting. Our internal control over financial reporting will be
required to meet the standards required by Section 404 of the Sarbanes-Oxley Act. We will incur additional costs in order to improve our
internal control over financial reporting and comply with Section 404, including increased auditing and legal fees and costs associated
with hiring additional accounting and administrative staff. Ultimately, our efforts may not be adequate to comply with the requirements
of Section 404. If we are unable to implement and maintain adequate internal control over financial reporting or otherwise to comply with
Section 404, we may be unable to report financial information on a timely basis, may suffer adverse regulatory consequences, may have
violations of the applicable national securities exchange listing rules, and may breach covenants under our credit facilities.
The significant obligations related to being
a public company will continue to require a significant commitment of additional resources and management oversight that will increase
our costs and might place a strain on our systems and resources. As a result, our management’s attention might be diverted from
other business concerns. In addition, we might not be successful in implementing and maintaining controls and procedures that comply with
these requirements. If we fail to maintain an effective internal control environment or to comply with the numerous legal and regulatory
requirements imposed on public companies, we could make material errors in, and be required to restate, our financial statements. Any
such restatement could result in a loss of public confidence in the reliability of our financial statements and sanctions imposed on us
by the SEC.
REDtone Asia, Inc. is a blank check company and has not implemented
its business plan. As of this filing, RTAS has no business plan and hopes to acquire a business in the Photovoltaic solar energy
industry, energy storage equipment and charging piles. RTAS hopes to raise sufficient capital to locate a suitable merger candidate.
Results of Operations for REDtone Asia,
Inc. —Comparison of the Year Ended April 30, 2023 and 2022 (Audited)
Revenue
We had no revenues from operations during
either April 30, 2023 or 2022.
Operating Expenses
For the
year ended April 30, 2023 and 2022, the Company had not operating expenses.
Other Income and Expenses
Other expenses for the year ended April 30, 2023
were $206,214 compared to $94,795 for the year ended April 30, 2022.
For the
year ended April 30, 2023 and 2022, the Company had no other income.
For the year ended April 30, 2023, foreign exchange
gains were $206,214, compared to $98,878 for the year ended April 30, 2022. For the year ended April 30, 2023, interest expenses were
$0, compared to $4,083 for the year ended April 30, 2022.
Stock compensation expense
During the year ended April 30, 2023, we incurred Nil on non-cash
stock compensation expense from the issuance of common stock for services. There was no stock issued for services in the prior year.
Net Income (Loss)
For the year ended April 30, 2023, the Company
had a net profit of $0 compared to the year ended April 30, 2022, a net loss of $4,083.
Other Comprehensive Income and Loss
For the year ended April 30, 2023, other comprehensive
profit from foreign currency translation adjustment were $206,214, compared to $98,878 for that of the year ended April 30, 2022.
Total Comprehensive Income and Loss
For the year ended April 30, 2023, total comprehensive
income was $206,214, compared to $94,795 for that of the year ended April 30, 2022.
Liquidity and Capital Resources
As of April 30, 2023, we had $0 of cash, $4,319,375 in total liabilities
and an accumulated deficit of $14,476,796 compared to $4,525,589 in total liabilities and an accumulated deficit of $14,476,796 for the
year ended April 30, 2022. We used $0 of cash in operations for the year ended April 30, 2023 and received net proceeds from financing
of $0.
The financial statements accompanying this Report have been prepared
on a going concern basis, which contemplates the realization of assets and settlement of liabilities and commitments in the normal course
of our business. As reflected in the accompanying financial statements, we have not yet generated any revenue, had a net profit of $0
and have an accumulated stockholders’ deficit of $14,476,796 and accumulated other comprehensive income of $657,738 as of April
30, 2023. These factors raise substantial doubt about our ability to continue as a going concern. Our ability to continue as a going
concern is dependent on our ability to raise additional funds and implement our business plan. The financial statements do not include
any adjustments that might be necessary if we are unable to continue as a going concern.
We do not own any property and do not pay
for office space.
Item 4. |
Security Ownership of Certain Beneficial Owners and Management |
(a) Security ownership of certain beneficial
owners.
The following table sets
forth, as of this filing, the number of shares of common stock owned of record and beneficially by our executive officer, director and
persons who beneficially own more than 5% of the outstanding shares of our common stock.
Name and Address of Beneficial Owner |
|
Amount and
Nature of
Beneficial Ownership |
|
Percentage
of Class |
|
|
|
|
|
|
|
Million Vision Development International Limited
Room 915, 9/F, Fortune Commercial
Bldg.
Tsuen Wan, New Territories K3
*Chan Wah Fant is the control person
|
|
260,619,365 Common Shares
|
|
80.18%
|
|
|
|
|
|
|
|
Bridgeview Capital Partners LLC
4202 Overlook Cir
Piermont, NY 10968
Michael Dobbs
Sean Larson
Control persons |
|
25,223,000 Common Shares |
|
7.76% |
|
|
|
|
|
|
|
Dr. Yang Chong Yi
19F, No.38 West Nanjing Road
Jing’An District Shanghai, China 200041
|
|
1,595,000 Preferred A Shares |
|
93.82% |
|
|
|
|
|
|
|
Global Asset Operation Group Co., Limited
Room 2408, Block B
Sunshine Science and Technology Park
Nanshan District, Shenzhen, China
Zhongxing Hu is the control person |
|
105,000 Preferred A Shares |
|
6.18% |
|
Item 5. |
Directors and Executive Officers |
A. Identification of Directors and Executive Officers.
Our Officers and directors and additional information concerning them
are as follows:
Name |
|
Age |
|
Position |
Dr. Yang Chong Yi |
|
62 |
|
CEO, President, Secretary, Treasurer, Director |
Officer Bios
Dr. Yang Chong Yi, Chief Executive Officer
Dr. Yang Chong Yi is experienced in both governmental
and private sectors, specializing in investment banking, and merger and acquisitions. Dr. Yang has held the following positions:
|
· |
Deputy Chief in the Bureau of Commodity Price in Shanghai Development and Reform Center |
|
· |
Associate Director in Hongkong First Eastern Investment Group |
|
· |
General Manager in Shanghai First Food Investment Management Company |
|
· |
Managing Director of a state-owned private equity fund |
Dr. Yang also has experience consulting businesses
in preparation for IPOs on listings on NASDAQ in addition to consulting commercial complex projects in the cities of New York and Los
Angeles.
Dr. Yang Chong Yi is the author of “Winning
at Quitting” and “The Economics of Popularity” and Visiting Professor at Shanghai Lixin Institute of Finance and Accounting,
a Distinguished Research Institution at the Economic Development Research Center of the Shanghai Municipal Government. Lastly, Dr. Yang
is Executive Secretary of the Financial and Economic Committee (Shanghai) of the US-China International Chamber of Commerce.
Item 6. |
Executive Compensation |
For the past two years,
no sole officer or director has received any cash remuneration. No remuneration of any nature has been paid for on account of services
rendered by a director in such capacity to date. Our officer and director intend to devote all of his time to RTAS and furthering the
contemplated acquisition of a business in the Photovoltaic solar energy industry, energy storage equipment and charging piles.
The Company, for the benefit of its employees,
has adopted no retirement, pension, profit sharing, stock option or insurance programs or other similar programs.
Item 7. |
Certain Relationship and Related Transactions, and Director Independence |
Regulation S-K, Item 4, Section C require
disclosure of promoters and certain control persons for registrants that are filing a registration statement on Form 10 under the Exchange
Act and that had a promoter at any time during the past five fiscal years shall:
(i) State the names of the promoter(s), the
nature and amount of anything of value (including money, property, contracts, options or rights of any kind) received or to be received
by each promoter, directly or indirectly, from the registrant and the nature and amount of any assets, services or other consideration
therefore received or to be received by the registrant; and
(ii) As to any assets acquired or to be acquired
by the registrant from a promoter, state the amount at which the assets were acquired or are to be acquired and the principle followed
or to be followed in determining such amount, and identify the persons making the determination and their relationship, if any, with the
registrant or any promoter. If the assets were acquired by the promoter within two years prior to their transfer to the registrant, also
state the cost thereof to the promoter.
Small Cap Compliance, LLC is considered a
promoter(s) under the meaning of Securities Act Rule 405. SCC was appointed custodian of the Company and under its duties stipulated
by the Nevada court. Small Cap Compliance, LLC took initiative to organize the business of the issuer. As custodian, its duties were
to conduct daily business, hold shareholder meetings, appoint officers and directors, reinstate the company with the Nevada Secretary
of State. The custodian also had authority to enter into contracts and find a suitable merger candidate. In addition, Small Cap Compliance,
LLC was compensated, in the amount of $30,000, for its role as custodian and paid outstanding bills to creditors on behalf of the company.
The custodian has not, and will not, receive any additional compensation, in the form of cash or stock, for custodian services. The custodianship
was discharged on August 14, 2019. See Item 1: Business for details.
Under Regulation S-K Item 404(c)(2) Registrants
shall provide the disclosure required by paragraphs (c)(1)(i) and (c)(1)(ii) of this Item as to any person who acquired control of a registrant
that is a shell company, or any person that is part of a group, consisting of two or more persons that agree to act together for the purpose
of acquiring, holding, voting or disposing of equity securities of a registrant, that acquired control of a registrant that is a shell
company.
As discussed in Item 1, the Company is deemed a shell company. As disclosed
in Item 4, there are several persons, Dr. Yang Chong Yi, is considered control person and acquired control of the Company. As discussed
in Item 1, purchased 1,700,000,000 shares of the Company’s Preferred A Shares. These shares represent the controlling block of stock
and were purchased from Bridgeview Capital Partners for $85,000.
Dr. Yang Chong Yi is
our CEO and President. He is not deemed to be independent under applicable rules. We have not established any committees of the Board
of Directors.
On June 28, 2023, Global
Asset Operation Group Co., Limited entered into a Stock Purchase Agreement with Dr. Yang Chong Yi, whereby Global Asset Operation Group
Co., Limited purchased 105,000 shares of Convertible Preferred A Series Stock for $30,000.
Except as set forth above,
there have been no related party transactions, or any other transactions or relationships required to be disclosed.
Item 8. |
Legal Proceedings |
Presently, there are
not any material pending legal proceedings to which the Registrant is a party or as to which any of its property is subject, and no such
proceedings are known to the Registrant to be threatened or contemplated against it.
Item 9. |
Market Price and Dividends on the Registrant’s Common Equity and Related Stockholder Matters |
(a) Market information.
Our Common Stock is not
trading on any stock exchange. However, it is currently listed on OTC Markets under the symbol RTAS and there is no established public
trading market for the class of common equity.
| |
HIGH | | |
LOW | |
Fiscal Year 2022 | |
| | | |
| | |
First Quarter (Jan.1, 2022 – March 31, 2022) | |
$ | .01 | | |
$ | .01 | |
Second Quarter (April 1, 2022– June 30, 2022) | |
| .005 | | |
| .005 | |
Third Quarter (July 1, 2022 – Sept. 30, 2022) | |
| .005 | | |
| .011 | |
Fourth Quarter (Oct. 1, 2022 – Dec. 31, 2022) | |
| .075 | | |
| .005 | |
| |
| | | |
| | |
Fiscal Year 2021 | |
| | | |
| | |
First Quarter (Jan.1, 2021 – March 31, 2021) | |
$ | .01 | | |
$ | .01 | |
Second Quarter (April 1, 2021– June 30, 2021) | |
| .01 | | |
| .01 | |
Third Quarter (July 1, 2021 – Sept. 30, 2021) | |
| .01 | | |
| .01 | |
Fourth Quarter (Oct. 1, 2021 – Dec. 31, 2021) | |
| .01 | | |
| .01 | |
(b) Holders.
As of this filing, there are approximately 52 holders of an aggregate
of 325,038,356 shares of our Common Stock issued and outstanding and 1 holder of 1,700,000 Preferred A shares issued and outstanding.
(c) 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 president intention
of management to utilize all available funds for the development of the Registrant’s business.
(d) Securities authorized for issuance under
equity compensation plans.
None.
Item 10. |
Recent Sale of Unregistered Securities |
On November 15, 2021,
Bridgeview Capital Partners, LLC entered into a Stock Purchase Agreement with Dr. Yang Chong Yi, whereby Dr. Yang Chong Yi purchased 1,700,000
shares of Convertible Preferred A Series Stock, the controlling block of stock, for the purchase price of $85,000.
On June 28, 2023, Global
Asset Operation Group Co., Limited entered into a Stock Purchase Agreement with Dr. Yang Chong Yi, whereby Global Asset Operation Group
Co., Limited purchased 105,000 shares of Convertible Preferred A Series Stock for $30,000.
The restricted shares
were sold in a private transaction pursuant to Rule 144(i) of the ’33 Securities Act. As of this date, the shares have not been
registered.
Item 11. |
Description of Registrant’s Securities to be Registered |
(a) Common.
We are authorized by our Certificate of Incorporation
to issue an aggregate of 2,000,000,000 shares of capital stock, of which 1,995,000,000 are shares of common stock, Par Value $0.001 per
share (the “Common Stock”). There are 5,000,000 are shares of preferred stock, Par Value $0.001 per share (the “Preferred
Stock”) and 2,000,000 Preferred shares are designated as Convertible Series A Preferred Stock. As of the date of this filing, there
are 325,038,356 shares of Common Stock issued and outstanding and 1,700,000 shares of Convertible Series A Preferred Stock issued and
outstanding.
Common Stock
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 matter submitted to a vote of stockholders of the Company. All stockholders are entitled to share equally dividends, if any, as
may be declared from time to time by the Board of Directors 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. The stockholders do not have cumulative
or preemptive rights.
Preferred Stock
Our Certificate of Incorporation authorizes
the issuances of up to 5,000,000 shares of Preferred Stock authorized with designations, rights and preferences determined from time to
time by its Board of Directors. Accordingly, our Board of Directors is empowered, without stockholder approval, to issue Preferred Stock
with dividend, liquidation, conversion, voting, or other rights, which 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.
At this time there are
2,000,000 shares of Preferred Stock authorized as Convertible Series A Preferred Stock and 1,700,000 are issued and outstanding.
One (1) share of the
as Convertible Series A Preferred Stock shall be converted into one thousand (1,000) shares of common stock of the Corporation and entitled
to one thousand (1,000) votes of common stock for every one (1) share of as Convertible Series A Preferred Stock owned. The holders of
the Convertible Series A Preferred Stock shall not be entitled to receive dividends.
From time to time its
Board of Directors may amend the Preferred class of stock. Accordingly, our Board of Directors is empowered, without stockholder approval,
to issue Preferred Stock with dividend, liquidation, conversion, voting, or other rights, which 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.
In the event of any liquidation,
dissolution or winding up of the Corporation, either voluntary or involuntary, after setting apart or paying in full the preferential
amounts due to Holders of senior capital stock, if any, the Holders of Series A Stock and parity capital stock, if any, shall be entitled
to receive, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the Holders of junior
capital stock, including Common Stock, an amount equal to $.001 per share [the "Liquidation Preference"]. If upon such liquidation,
dissolution or winding up of the Corporation, the assets of the Corporation available for distribution to the Holders of the Series A
Stock and parity capital stock, if any, shall be insufficient to permit in full the payment of the Liquidation Preference, then all such
assets of the Corporation shall be distributed ratably among the Holders of the Series D Stock and parity capital stock, if any. Neither
the consolidation or merger of the Corporation nor the sale, lease or transfer by the Corporation of all or a part of its assets shall
be deemed a liquidation, dissolution or winding up.
The description of certain
matters relating to the securities of the Company is a summary and is qualified in its entirely by the provisions of the Company’s
Certificate of Incorporation and Bylaws copies of which have been filed as exhibits to this Form 10.
Section 13 of our By-laws state the following;
Section 13 Super
Majority Votes: Motions on the following issues shall require the vote of at least sixty-five percent (65%) of the Stockholders to
carry:
|
A. |
Amending these By-Laws; |
|
|
|
|
B |
Capital Contributions; |
|
|
|
|
C |
Removal of the Director or any Officer; |
|
|
|
|
D. |
Issuing New Shares of stock; |
|
|
|
|
E. |
Issuing New Classes of Shares; |
|
|
|
|
F. |
Terminating or rejecting the defense or indemnity of any Director, Officer, agent, or employee; and |
|
|
|
|
G. |
Terminating, Dissolving, or winding down the business affairs of the Corporation or liquidating more than half of the assets and property of the Corporation. |
Our Preferred D shareholder has over 65% of
the voting shares and will carry the necessary votes to determine the outcome for all of the above-mentioned actions.
Section 15 of our By-laws state the following;
Section 15 Stock Transfer Restrictions. A
Stockholder contemplating a sale or transfer of any shares of Stock in the Corporation to any third party shall first provide written
Notice of Intent to Sell Stock to the Board and all the other Stockholders which shall include the name of the proposed purchaser and
the full terms and conditions of the proposed sale. The other Stockholders shall have thirty (30) days from Notice of Intent To Sell Stock
to give written Notice of Intent to Purchase Stock on the same terms and conditions as set forth in the Notice of Intent to Sell Stock.
If no Stockholder gives Notice of Intent to Purchase Stock within thirty
(30) days, then the Stockholder may sell as set forth in the Notice of Intent to Sell Stock provided that a majority of the remaining
Stockholders approve the sale or transfer to the proposed third-party purchaser.
Any purported sale or transfer of shares of Stock
in the Corporation undertaken without compliance with all the provisions of Section 15 shall be void and without effect.
Any potential purchaser of shares of Stock in the Corporation Buyer
shall be advised of the restrictions imposed by these By-Laws and Nevada law, including but not limited to Chapters 78, 78A, and 90 of
the Nevada Revised Statutes.
Under Section 78.242 of the Nevada Revised Statutes, this provision
applies to the holders of restricted stock that has not been registered in is being sold or transferred in a private sale. It is the policy
of our Board to review the private sale and approve the sale if all required documentation is in order. The majority stockholder must
also approve the sale. In this case, it is our Preferred D Stock shareholder, who is also our sole officer and director.
(b) Debt Securities.
None.
(c) Other Securities To Be Registered.
None.
Item 12. |
Indemnification of Directors and Officers |
Our
Officers and Directors are indemnified as provided by the Nevada corporate law and our Bylaws. We have agreed to indemnify all our directors
and certain officers against certain liabilities, including liabilities under the Securities Act of 1933. Insofar as indemnification for
liabilities arising under the Securities Act of 1933 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 Securities and Exchange Commission such indemnification
is against public policy as expressed in the Securities Act of 1933 and is, therefore, 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 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 adjudication of such issue.
We
have been advised that in the opinion of the Securities Exchange Commission indemnification for liabilities arising under the Securities
Act against public policy as expressed in the Securities Act, and is, therefore, unenforceable. If a claim for indemnification against
such liabilities is asserted by one of our directors, officers, or controlling persons in connection with the securities being registered,
we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit question of whether such
indemnification is against public policy to a court of appropriate jurisdiction. We will then be governed by the court’s decision.
Item 15. |
Financial Statements and Exhibits |
|
|
|
|
|
REDTONE ASIA, INC.
CONSOLIDATED FINANCIAL STATEMENTS
(Audited)
Report of Independent Registered Public Accounting
Firm
To the shareholders and the board of directors
of Redtone Asia, Inc.
Opinion on the Financial Statements
We have audited the accompanying balance sheets
of Redtone Asia, Inc. as of April 30, 2023 and 2022, the related statements of operations, stockholders' equity (deficit), and cash flows
for the years then ended, and the related notes (collectively referred to as the "financial statements"). In our opinion, the
financial statements present fairly, in all material respects, the financial position of the Company as of April 30, 2023 and 2022, and
the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted
in the United States.
Substantial Doubt about the Company’s
Ability to Continue as a Going Concern
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 significant accumulated deficit. In addition, the Company continues to experience
negative cash flows from operations. These factors raise substantial doubt about the Company's 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 audits we are required to obtain an understanding
of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s
internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess
the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond
to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating
the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
/S/ BF Borgers CPA PC
BF Borgers CPA PC (PCAOB ID 5041)
We have served as the Company's auditor since
2021
Lakewood, CO
July 7, 2023
REDTONE ASIA, INC.
BALANCE SHEETS
| |
As at April 30 | |
| |
Note | |
2023 | | |
2022 | |
| |
| |
| | |
| |
TOTAL ASSETS | |
| |
$ |
– | | |
$ |
– | |
| |
| |
| | |
| |
LIABILITIES AND STOCKHOLDERS' DEFICIT | |
| |
| | | |
| | |
Notes payables | |
4 | |
$ | – | | |
$ | – | |
Accounts payable | |
| |
| 546,280 | | |
| 572,360 | |
Accrued expenses and other payables | |
5 | |
| 899,849 | | |
| 942,810 | |
Amount due to related parties | |
6 | |
| 1,904,642 | | |
| 1,995,572 | |
Tax payable | |
| |
| 968,604 | | |
| 1,014,847 | |
Total current liabilities | |
| |
| 4,319,375 | | |
| 4,525,589 | |
| |
| |
| | | |
| | |
Total non-current liabilities | |
| |
| – | | |
| – | |
| |
| |
| | | |
| | |
TOTAL LIABILITIES | |
| |
| 4,319,375 | | |
| 4,525,589 | |
| |
| |
| | | |
| | |
STOCKHOLDERS' DEFICIT | |
| |
| | | |
| | |
Preferred Stock ($0.001 par value, 5,000,000 shares authorized, nil issued and outstanding as of April 30, 2023 and 2022) | |
| |
| | | |
| | |
Convertible Series A Preferred Stock ($0.001 par value, 2,000,000 shares authorized, 1,700,000 shares issued and outstanding as of April 30, 2023 and 2022) | |
7 | |
| 1,700 | | |
| 1,700 | |
Common stock ($0.001 par value, 2,000,000,000 shares authorized, 326,815,356 shares issued and outstanding as of April 30, 2023 and 2022) | |
7 | |
| 326,815 | | |
| 326,815 | |
Additional paid-in capital | |
| |
| 9,171,168 | | |
| 9,171,168 | |
Accumulated deficit | |
| |
| (14,476,796 | ) | |
| (14,476,796 | ) |
Accumulated other comprehensive income | |
| |
| 657,738 | | |
| 451,524 | |
| |
| |
| | | |
| | |
TOTAL STOCKHOLDERS' DEFICIT | |
| |
| (4,319,375 | ) | |
| (4,525,589 | ) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | |
| |
$ | – | | |
$ | – | |
The accompanying notes are an integral part of these financial statements
REDTONE ASIA, INC.
STATEMENTS OF OPERATIONS
|
|
For the years ended April 30 |
|
|
|
2023 |
|
|
2022 |
|
OTHER INCOME/(EXPENSE) |
|
|
|
|
|
|
|
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
206,214 |
|
|
|
98,878 |
|
Other income |
|
|
|
|
|
|
|
|
Total other income/(expense) |
|
|
- |
|
|
|
(4,083) |
|
Net profit/ (loss) |
|
|
- |
|
|
|
(4,083) |
|
Income tax |
|
|
|
|
|
|
|
|
Net profit/ (loss) after income tax |
|
|
206,214 |
|
|
|
94,795 |
|
Net loss per share - basic and diluted |
|
|
- |
|
|
|
- |
|
Weighted average number of common shares outstanding |
|
|
326,815,356 |
|
|
|
326,815,356 |
|
|
|
|
|
|
|
|
|
|
Comprehensive income/(loss) |
|
|
|
|
|
|
|
|
Net profit/(loss) |
|
|
- |
|
|
|
(4,083) |
|
Foreign currency translation adjustment |
|
|
206,214 |
|
|
|
98,787 |
|
Other comprehensive attributable to shareholders of the Company |
|
|
206,214 |
|
|
|
98,787 |
|
The accompanying notes are an integral part of these financial statements
REDTONE ASIA, INC.
STATEMENTS OF CHANGES IN STOCKHOLDERS’
DEFICIT
| |
Convertible
Series A Preferred
Stock | | |
Common Stock | | |
Additional Paid in Capital | | |
Accumulated Deficit | | |
Other
Comprehensive Income | | |
Total | |
| |
Shares | | |
Amount | | |
Shares | | |
Amount | | |
| | |
| | |
| | |
| |
Balance, April 30, 2021 | |
| 1,700,000 | | |
$ | 1,700 | | |
| 282,315,356 | | |
$ | 282,315 | | |
$ | 9,171,110 | | |
| (14,472,713 | ) | |
| 352,646 | | |
$ | (4,664,942 | ) |
Promissory notes converted to common shares at the rate of 0.001 | |
| – | | |
| – | | |
| 44,500,000 | | |
| 44,500 | | |
| 58 | | |
| – | | |
| | | |
| 44,558 | |
Net profit for the year ended April 30, 2022 | |
| – | | |
| | | |
| | | |
| | | |
| | | |
| 94,795 | | |
| | | |
| 94,795 | |
Foreign currency translation adjustment | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| 98,875 | | |
| 98,875 | |
Balance, April 30, 2022 | |
| 1,700,000 | | |
$ | 1,700 | | |
| 326,815,356 | | |
$ | 326,815 | | |
$ | 9,171,168 | | |
| (14,476,796 | ) | |
| 451,524 | | |
$ | (4,525,589 | ) |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Net profit for the year ended April 30, 2023 | |
| – | | |
| – | | |
| – | | |
| – | | |
| – | | |
| 206,214 | | |
| | | |
| 206,214 | |
Foreign currency translation adjustment | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| 206,214 | | |
| 206,214 | |
Balance, April 30, 2023 | |
| 1,700,000 | | |
$ | 1,700 | | |
| 326,815,356 | | |
$ | 326,815 | | |
$ | 9,171,168 | | |
| (14,476,796 | ) | |
| 657,738 | ) | |
$ | (4,319,375 | ) |
The accompanying notes are an integral part of these financial statements
REDTONE ASIA, INC.
STATEMENTS OF CASH FLOWS
|
|
For the years ended April 30 |
|
|
|
2023 |
|
|
2022 |
|
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
Net gain (loss) |
|
$ |
|
|
|
$ |
(4,083) |
|
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
|
|
|
|
Compensation expenses |
|
|
|
|
|
|
|
|
Interest expense |
|
|
– |
|
|
|
4,083 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Taxes payable |
|
|
|
|
|
|
|
|
Other payables and accrued liabilities |
|
|
|
|
|
|
|
|
Cash used in operating activities |
|
|
– |
|
|
|
– |
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
Investment received from Preferred C shares issued |
|
|
– |
|
|
|
– |
|
Cash generated from financing activities |
|
|
– |
|
|
|
– |
|
|
|
|
|
|
|
|
|
|
Net change in cash and equivalents |
|
$ |
– |
|
|
$ |
– |
|
Cash and equivalents, beginning of period |
|
|
– |
|
|
|
– |
|
Cash and equivalents, end of period |
|
|
– |
|
|
|
– |
|
|
|
|
|
|
|
|
|
|
Cash paid for interest |
|
$ |
– |
|
|
$ |
– |
|
Cash paid for income taxes |
|
$ |
– |
|
|
$ |
– |
|
The accompanying notes are an integral part of these financial statements
REDTONE ASIA, INC.
Notes to Financial Statements
Note 1. ORGANIZATION AND DESCRIPTION OF BUSINESS
REDTONE ASIA, INC. ("REDTONE", "we",
the "Company") was incorporated under the laws of the State of Nevada in 2005.
The Company was a telecommunications provider
for mobile, fixed and international gateway services. REDTONE provided a wide range of telecommunication services, including prepaid and
postpaid discounted call services to corporate customers and consumers as well as prepaid mobile airtime top-up. The Company also offered
prepaid shopping card services.
During 2004 through 2014, the Company invested
in 11 subsidiaries and variable interest entities (VIE) located in the PRC, Hongkong and BVI. These subsidiaries and VIEs were engaged
in the same industry as the Company with principal business activities of investment holding, provision of technical support services
to group companies, marketing and distribution of IP call and discounted call services in the PRC, trading of discounted call related
equipment and provision of related services.
Prior to May 1, 2019, the Company divested all
of its interests in subsidiaries and VIEs and ceased active trading since fiscal year from May 1, 2019.
The Company is not actively trading or operating
during the current reporting period. The main impact on P&L statement due from liabilities with related parties, which carried forward
with Chinese Yuan (CNY). The Company plans to acquire a business in Photovoltaic solar energy, energy storage equipment and charging
piles.
Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The Company maintains its accounts and prepares
its financial statements using the accrual method accounting. These financial statements and notes are representations of management.
Accounting policies adopted by the Company conform to generally accepted accounting principles in the United States of America and have
been consistently applied.
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. Significant estimates include the estimated useful lives of property and equipment.
Actual results could differ from those estimates.
Foreign Currency Translation
The Company maintains its financial statements
in its functional currency, which is US dollar ("USD"). Monetary assets and liabilities denominated in currencies other than
the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet dates. Exchange
gains or losses arising from foreign currency transactions or translation of monetary assets and liabilities denominated in foreign currencies
are included in the statement of operations for the respective periods.
Exchange rates used in these financial statements,
USD to Chinese Yuan (CNY), are 6.924 and 6.4672 at April 30, 2023 and 2022 respectively.
Related Party
A party is considered to be related to the Company
if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with
the Company. Related parties also include principal owners of the Company, its management, member of the immediate families of principal
owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly
influence the management or operating policies of the other to an extent that one of the transacting party might be prevented from fully
pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting
parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that
one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.
Income taxes
The Company follow ASC 740-10-30, which requires
recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial
statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement
and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to
reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the
assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income
in the fiscal 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 the Statements of Income in the period that includes the enactment date.
On December 22, 2017, the Tax Cuts and Jobs Act
(TCJA) was signed into law by the President of the United States. TCJA is a tax reform act that among other things, reduced corporate
tax rates to 21 percent effective January 1, 2018. FASB ASC 740, Income Taxes, requires deferred tax assets and liabilities to be adjusted
for the effect of a change in tax laws or rates in the year of enactment, which is the year in which the change was signed into law. Accordingly,
the Company adjusted its deferred tax assets and liabilities at December 31, 2017, using the new corporate tax rate of 21 percent.
The Company adopted ASC 740-10-25 (“ASC
740-10-25”) with regard to uncertainty income taxes. ASC 740-10-25 addresses the determination of whether tax benefits claimed or
expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740-10-25, we may recognize the tax benefit
from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing
authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position
should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC
740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, and accounting in interim
periods and requires increased disclosures. We had no material adjustments to our liabilities for unrecognized income tax benefits according
to the provisions of ASC 740-10-25.
Net income (loss) per
common share
Net income (loss) per common share is computed
pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net income (loss) per common share is computed by dividing
net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per
common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially outstanding
shares of common stock during the period. The weighted average number of common shares outstanding and potentially outstanding common
shares assumes that the Company incorporated as of the beginning of the first period presented. For the reporting periods ended April
30, 2023 and 2022, there are 282,315,356 outstanding common shares and no potentially dilutive shares, respectively, from convertible
preferred stock.
Preferred stock and convertible
preferred stock
For the reporting periods ended April 30, 2023
and 2022, there are 5,000,000 shares of Preferred Stock authorized.
For the reporting periods ended April 30, 2023
and 2022, there are 2,000,000 shares of Convertible Series A Preferred Stock authorized and 1,700,000 shares issued. Each Convertible
Series A Preferred Stock is convertible into 1,000 shares of common stock and entitled to 1,000 votes. Holders of the Convertible Series
A Preferred Stock are not entitled to receive dividends.
Other Comprehensive Income
Other comprehensive income is defined as the change
in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources, other
than net income and including foreign currency translation adjustments.
Revision of Issued Financial
Statements
During the year ending April 30, 2023 and 2022,
the Company identified an error in its foreign currency transaction instead of foreign currency translation adjustment. In fact, The Company
is not actively trading or operating during the year ending April 30, 2023 and 2022. ASC830-30 shall be applied for the foreign currency
translation adjustment.
The Company evaluated the misstatements and concluded
that the misstatements were not material, either individually or in the aggregate, to its current or issued financial statements.
To correct the immaterial misstatements, during
the year ended April 30, 2023 and 2022, the Company elected to revise its issued statements of operations. The revision of the historical
financial statements includes the correction of these immaterial misstatements as well as other identified financial statement misclassifications.
Accordingly, the accompanying annual audited statements of operations and relevant footnotes in this Annual on Form 10-K as well as the
2023 and 2022 financial statements have been revised to correct for such immaterial misstatements.
Accordingly, the accompanying April 31, 2023 and
2022, balance sheets, statements of operations and cash flows have been revised to correct for such immaterial misstatements.
The impact of the revision
on the Company’s balance sheets as of April 30, 2023 and 2022, are reflected in the following tables:
| |
As at April 30, 2023 | |
| |
As Reported | | |
Revision | | |
As revised | |
| |
| | |
| | |
| |
| |
| | |
| | |
| |
STOCKHOLDERS' DEFICIT | |
| | | |
| | | |
| | |
Preferred Stock ($0.001 par value, 5,000,000 shares authorized, nil issued and outstanding as of April 30, 2023 and 2022) | |
| | | |
| | | |
| | |
Convertible Series A Preferred Stock ($0.001 par value, 2,000,000 shares authorized, 1,700,000 shares issued and outstanding as of April 30, 2023 and 2022) | |
| 1,700 | | |
| | | |
| 1,700 | |
Common stock ($0.001 par value, 2,000,000,000 shares authorized, 326,815,356 shares issued and outstanding as of April 30, 2023 and 2022) | |
| 326,815 | | |
| | | |
| 326,815 | |
Additional paid-in capital | |
| 9,171,168 | | |
| | | |
| 9,171,168 | |
Accumulated deficit | |
| (13,819,058 | ) | |
| (657,738 | ) | |
| (14,476,796 | ) |
Accumulated other comprehensive income | |
| | | |
| 657,738 | | |
| 657,738 | |
| |
| | | |
| | | |
| | |
TOTAL STOCKHOLDERS' DEFICIT | |
| (4,319,375 | ) | |
| | | |
| (4,319,375 | ) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | |
| | | |
| – | | |
| – | |
| |
As at April 30, 2022 | |
| |
As Reported | | |
Revision | | |
As revised | |
| |
| | |
| | |
| |
| |
| | |
| | |
| |
STOCKHOLDERS' DEFICIT | |
| | | |
| | | |
| | |
Preferred Stock ($0.001 par value, 5,000,000 shares authorized, nil issued and outstanding as of April 30, 2023 and 2022) | |
| | | |
| | | |
| | |
Convertible Series A Preferred Stock ($0.001 par value, 2,000,000 shares authorized, 1,700,000 shares issued and outstanding as of April 30, 2023 and 2022) | |
| 1,700 | | |
| | | |
| 1,700 | |
Common stock ($0.001 par value, 2,000,000,000 shares authorized, 326,815,356 shares issued and outstanding as of April 30, 2023 and 2022) | |
| 326,815 | | |
| | | |
| 326,815 | |
Additional paid-in capital | |
| 9,171,168 | | |
| | | |
| 9,171,168 | |
Accumulated deficit | |
| (14,025,272 | ) | |
| (451,524 | ) | |
| (14,476,796 | ) |
Accumulated other comprehensive income | |
| | | |
| 451,524 | | |
| 451,524 | |
| |
| | | |
| | | |
| | |
TOTAL STOCKHOLDERS' DEFICIT | |
| (4,525,589 | ) | |
| – | | |
| (4,525,589 | ) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | |
| | | |
| – | | |
| – | |
The impact of the revision
on the Company’s statement of operations as of April 30, 2023 and 2022, are reflected in the following tables:
| |
For the years ended April 31, 2023 | |
| |
As Reported | | |
Revision | | |
As revised | |
OTHER INCOME/(EXPENSE) | |
| | | |
| | | |
| | |
Interest expense | |
| – | | |
| | | |
| – | |
Foreign exchange gains/ (losses), net | |
| 206,214 | | |
| (206,214 | ) | |
| – | |
Other income | |
| | | |
| | | |
| – | |
Total other income/(expense) | |
| | | |
| | | |
| – | |
Net profit/ (loss) | |
| | | |
| | | |
| – | |
Income tax | |
| | | |
| | | |
| – | |
Net profit/ (loss) after income tax | |
| 206,214 | | |
| (206,214 | ) | |
| – | |
Net loss per share - basic and diluted | |
| (0.00 | ) | |
| | | |
| 0.00 | |
Weighted average number of common shares outstanding | |
| 326,815,356 | | |
| | | |
| 326,815,356 | |
| |
| | | |
| | | |
| | |
Comprehensive income/(loss) | |
| | | |
| | | |
| | |
Net profit/(loss) | |
| – | | |
| | | |
| – | |
Foreign currency translation adjustment | |
| | | |
| | | |
| 206,214 | |
Other comprehensive attributable to shareholders of the Company | |
| | | |
| | | |
| 206,214 | |
| |
| | | |
| | | |
| | |
Total comprehensive income/ (loss) | |
| – | | |
| | | |
| 206,214 | |
| |
For the years ended April 30, 2022 | |
| |
As Reported | | |
Revision | | |
As revised | |
OTHER INCOME/(EXPENSE) | |
| | | |
| | | |
| | |
Interest expense | |
| (4,083 | ) | |
| | | |
| (4,083 | ) |
Foreign exchange gains/ (losses), net | |
| 98,878 | | |
| (98,878 | ) | |
| – | |
Other income | |
| | | |
| | | |
| – | |
Total other income/(expense) | |
| | | |
| | | |
| – | |
Net profit/ (loss) | |
| | | |
| | | |
| – | |
Income tax | |
| | | |
| | | |
| – | |
Net profit/ (loss) after income tax | |
| 94,795 | | |
| (98,878 | ) | |
| (4,083 | ) |
Net loss per share - basic and diluted | |
| (0.00 | ) | |
| | | |
| (0.00 | ) |
Weighted average number of common shares outstanding | |
| 326,815,356 | | |
| | | |
| 326,815,356 | |
| |
| | | |
| | | |
| | |
Comprehensive income/(loss) | |
| | | |
| | | |
| | |
Net profit/(loss) | |
| – | | |
| | | |
| – | |
Foreign currency translation adjustment | |
| – | | |
| 98,878 | | |
| 98,878 | |
Other comprehensive attributable to shareholders of the Company | |
| | | |
| | | |
| 94,795 | |
| |
| | | |
| | | |
| | |
Total comprehensive income/ (loss) | |
| – | | |
| | | |
| 94,795 | |
The impact of the revision
on the Company’s cash flows as of April 30, 2023 and 2022, are reflected in the following tables:
| |
For the years ended April 30, 2023 | |
| |
As Previously Reported | | |
Revision | | |
As revised | |
CASH FLOWS FROM OPERATING ACTIVITIES | |
| | | |
| | | |
| | |
Net gain (loss) | |
| 206,214 | | |
| (206,214 | ) | |
| – | |
Adjustments to reconcile net loss to net cash used in operating activities: | |
| | | |
| | | |
| | |
Compensation expenses | |
| | | |
| | | |
| | |
Interest expense | |
| | | |
| | | |
| – | |
Changes in operating assets and liabilities: | |
| | | |
| | | |
| | |
Taxes payable | |
| (46,242 | ) | |
| 46,242 | | |
| – | |
Other payables and accrued liabilities | |
| (159,972 | ) | |
| 159,972 | | |
| – | |
Cash used in operating activities | |
| | | |
| – | | |
| – | |
Recently issued accounting
pronouncements
In December 2019, the FASB issued ASU 2019-12,
Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This standard is intended to simplify the accounting and disclosure
requirements for income taxes by eliminating various exceptions in accounting for income taxes and clarifying and amending existing guidance
to improve consistency in application of ASC 740. The provisions of ASU 2019-12 are effective for years beginning after December 15, 2021,
with early adoption permitted. We do not expect the adoption of this ASU to result in a material impact on our financial statements.
In March 2020, the FASB issued ASU 2020-04, Reference
Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This standard provides practical
expedients for contract modifications with the transition from reference rates, such as LIBOR, that are expected to be discontinued. This
guidance is applicable for our revolving line of credit, which uses LIBOR as a reference rate. The provisions of ASU 2020-04 are effective
as of March 12, 2020 and may be adopted prospectively through December 31, 2022. We do not expect the adoption of this ASU to result in
a material impact on our financial statements.
The Company has implemented all new accounting
pronouncements that are in effect. We do not believe that there are any other new accounting 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 using accounting
principles generally accepted in the United States of America applicable to a going concern that contemplates the realization of assets
and liquidation of liabilities in the normal course of business. The Company has not established any source of revenue to cover its operating
costs and has an accumulated deficit of $ 14,476,796 as at April 30, 2023. These conditions raise substantial doubt about the company’s
ability to continue as a going concern.
In addition to operational expenses, as the Company
executes its business plan, it is incurring expenses related to complying with its public reporting requirements. In order to finance
these expenditures, the Company has raised capital in the form of debt, which will have to be repaid, as discussed in detail below. The
Company has depended on loans from related parties and shareholders for most of its operating capital. The Company will need to raise
capital in the next twelve months in order to remain in business.
Management anticipates that significant dilution
will occur as a result of any future sales of the Company’s common stock and this will reduce the value of its outstanding shares.
The Company cannot project the future level of dilution that will be experienced by investors as a result of its future financings, but
it will significantly affect the value of its shares.
The accompanying financial statements do not include
any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications
of liabilities that may result from the possible inability of the Company to continue as a going concern.
NOTE 4 – NOTES PAYABLE
On May 22, 2019 the Company issued convertible
promissory notes to BRIDGEVIEW Capital Partners LLC (the “Holder”) for the aggregated principal amount of $30,000. This Note
shall automatically be converted into shares of the Company’s common stock (“Common Stock”) at the Note Conversion Rate
of $0.001. Holder shall not be able to convert into any position that would result the Holder to hold more than 9.9% of the class of common
stock of the Company.
Interest on the outstanding portion of Principal
of this Note shall accrue at a rate of 18% per annum. All computations of interest shall be made on the basis of a 365-day year for actual
days elapsed.
At January 31, 2022, the above notes were
converted into 44,500,000 common shares at the rate of 0.001 with a restriction of no more than 9.9% of common stock at the book
value of USD 44,557.81.
NOTE 5 – Accrued expenses and other payables
| |
April 30, 2023 | | |
April 30, 2022 | |
Accrued expenses | |
| 408,726 | | |
| 428,240 | |
Other payables | |
| 491,123 | | |
| 514,570 | |
Total | |
| 899,849 | | |
| 942,810 | |
NOTE 6 – AMOUNT DUE TO RELATED PARTIES
All amounts due to related parties represent amounts
due to former fellow subsidiaries. They are denominated in the original currency of Chinese Yuan and are all unsecured and interest free.
Amounts due to related parties have no fixed repayment date, and the Company does not intend to repay within twelve months from April
30, 2023.
NOTE 7 –COMMON STOCK AND PREFERRED STOCK
The Company has 2,000,000,000 shares of common
stock authorized at par value of $0.001, and 326,815,356 shares of common stock were issued and outstanding at beginning and end of the
reporting periods at total par value of $326,815.
The Company has 2,000,000 shares of Convertible
Series A Preferred Stock authorized at par value of $0.001, and 1,700,000 shares of Convertible Series A Preferred Stock were issued and
outstanding at beginning and end of the reporting periods at total par value of $1,700.
NOTE 8 – INCOME TAXES
Deferred taxes are provided on a liability method
whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred
tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts
of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management,
it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities
are adjusted for the effects of changes in tax laws and rates on the date of enactment. As the Company’s main business place is
in P. R China, the corporate income tax rate of 25% is applied in calculation of deferred taxes.
Deferred income taxes reflect the tax consequences
on future years of differences between the tax bases. Net operating loss carry-forwards and tax benefits arising therefore are as follows:
Deferred tax assets |
|
April 30, 2023 |
|
|
April 30, 2022 |
|
Net operating loss (NOL) brought forward |
|
|
12,071,504 |
|
|
|
12,067,421 |
|
Net loss/(profit) for the period / year |
|
|
|
|
|
|
4,083 |
|
NOL carried forward |
|
|
12,071,504 |
|
|
|
12,071,504 |
|
Tax benefit from NOL carried forward |
|
|
3,017,876 |
|
|
|
3,017,876 |
|
Valuation allowance |
|
|
(3,017,876 |
) |
|
|
(3,017,876 |
) |
Deferred tax assets |
|
|
– |
|
|
|
– |
|
The PRC income tax allows the enterprises to offset
their future taxable income with taxable operating losses carried forward in a 5-year period. The management believes that the Company’s
cumulative losses arising from recurring business in recent years constituted significant negative evidence that most of the deferred
tax assets would not be realizable and this evidence outweighed the expectations that the Company would generate future taxable income.
Valuation allowance for the full amount of tax benefit from NOL was recorded.
NOTE 9 COMMITMENTS AND CONTINGENCIES
As at the end of the reporting period, the company
has no commitments and contingencies to disclose.
NOTE 10 RELATED-PARTY TRANSACTIONS
The company was not engaging in any business activities
during the reporting periods, and has no related party transactions and balances other than those disclosed in Notes 6.
NOTE 11 SUBSEQUENT EVENTS
As at the date these financial statements are
ready to be released, the Company has no subsequent events to disclose.
** Previously filed on July 25, 2023 as exhibit to
Form 10-12G
SIGNATURES
Pursuant to the requirements of Section 12 of the
Securities Exchange Act of 1934, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized.
|
REDTONE ASIA, INC. |
|
|
|
|
|
Date: September 14, 2023 |
By: |
/s/ Dr. Yang Chong Yi |
|
|
Name: |
Dr. Chongyi Yang |
|
|
Title: |
CEO |
|
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