ITEM 1. FINANCIAL STATEMENTS
AS CAPITAL, INC.
CONDENSED BALANCE SHEETS
(Unaudited)
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March 31, 2020
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December 31, 2019
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(Audited)
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ASSETS
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Current assets:
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Cash
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$
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–
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$
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–
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Total Current Assets
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$
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–
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$
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–
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LIABILITIES AND SHAREHOLDERS’ DEFICIENCIES
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Current liabilities:
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Accrued expenses
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$
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31,159
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$
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21,596
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Due to a related party
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138,533
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121,063
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Total Current Liabilities
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169,692
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142,659
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TOTAL LIABILITIES
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169,692
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142,659
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Commitments and contingencies
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–
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–
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Shareholders’ Deficiencies:
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Preferred Stock, par value; $0.0001, 5,000,000 shares authorized, no shares issued and outstanding
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–
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–
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Preferred Stock, Series A, par value; $0.0001, 1,000,000 shares authorized, 1,000 and 1,000 shares issued and outstanding; respectively
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–
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–
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Preferred Stock, Series B, par value; $0.0001, 3,000,000 shares authorized, no shares issued and outstanding
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–
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–
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Preferred Stock, Series C, par value; $0.0001, 1,000,000 shares authorized, none and 1,000,000 shares issued and outstanding, respectively
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–
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–
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Common stock, $0.0001 par value, 75,000,000 shares authorized; 11,201,030 and 11,201,030 shares issued and outstanding; respectively
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1,120
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1,120
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Additional paid-in capital
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36,110,927
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36,110,927
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Accumulated deficit
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(36,281,739
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)
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(36,254,706
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)
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Total Shareholders’ Deficiencies
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(169,692
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)
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(142,659
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)
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TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIENCIES
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$
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–
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$
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–
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The accompanying notes are an integral
part of the unaudited condensed financial statements
AS CAPITAL, INC.
CONDENSED STATEMENTS
OF OPERATIONS
(Unaudited)
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Three months ended March 31,
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2020
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2019
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Revenue
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$
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–
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$
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–
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General and administrative expenses
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(27,033
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)
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(3,754
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)
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Total operating expenses
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(27,033
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)
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(3,754
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)
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Loss before income taxes
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(27,033
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)
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(3,754
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)
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Income taxes
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–
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–
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NET LOSS
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$
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(27,033
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)
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$
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(3,754
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)
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Basic and diluted net loss per share
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$
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0.00
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$
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0.01
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Basic and diluted weighted average shares outstanding
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11,201,030
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201,030
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The accompanying notes are an integral
part of these unaudited condensed financial statement.
AS CAPITAL INC.
CONDENSED STATEMENT
OF CHANGES IN SHAREHOLDERS’ DEFICIENCY
(Unaudited)
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Three months ended
March 31, 2020
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Series A
Preferred
Stock
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Series C
Preferred
Stock
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Ordinary shares
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Additional
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No. of shares
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Amount
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No. of shares
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Amount
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No. of shares
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Amount
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paid-in capital
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Accumulated
deficit
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Total
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Balance as of January 1, 2020
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1,000
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$
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–
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–
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$
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–
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11,201,030
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$
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1,120
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$
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36,110,927
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$
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(36,254,706
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)
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$
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(142,659
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)
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Net
loss for the period
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–
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–
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–
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–
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–
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–
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–
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(27,033
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)
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(27,033
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)
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Balance as of March
31, 2020
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1,000
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$
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–
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–
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$
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–
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11,201,030
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$
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1,120
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$
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36,110,927
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$
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(36,281,739
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)
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$
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(169,692
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)
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Three months ended
March 31, 2019
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Series A
Preferred
Stock
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Series C
Preferred
Stock
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Ordinary shares
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Additional
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No. of shares
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Amount
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No. of shares
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Amount
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No. of shares
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Amount
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paid-in capital
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Accumulated
deficit
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Total
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Balance as of January 1, 2019
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1,000
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$
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–
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1,000,000
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$
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100
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201,030
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$
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20
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$
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36,052,540
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$
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(36,101,190
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)
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$
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(48,530
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)
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Net
loss for the period
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–
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–
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–
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–
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–
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–
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–
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(3,754
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)
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(3,754
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)
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Balance as of March
31, 2019
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1,000
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$
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–
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1,000,000
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$
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100
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201,030
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$
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20
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$
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36,052,540
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$
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(36,104,944
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)
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$
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(52,284
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)
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The accompanying notes are an integral
part of these unaudited condensed financial statement.
AS CAPITAL INC.
CONDENSED STATEMENT
OF CASH FLOWS
(Unaudited)
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Three months ended March 31,
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2020
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2019
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Cash flow from operating activities
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Net loss
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$
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(27,033
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)
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$
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(3,754
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)
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Adjustments to reconcile net loss to net cash generated from (used in) operating activities
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Change in operating assets and liabilities:
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Increase in accounts payable
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–
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550
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Increase in accrued liabilities
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9,563
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–
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Cash used in operating activities
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(17,470
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)
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(3,204
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)
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Cash flows from financing activities
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Proceeds from a related party
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17,470
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6,000
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Net cash generated from financing activities
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17,470
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6,000
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NET CHANGE IN CASH
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–
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2,796
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Cash, beginning of period
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–
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65
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|
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|
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2,861
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|
Cash, end of period
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$
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–
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$
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–
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SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
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Cash paid during the year for:
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Interest
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$
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–
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$
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–
|
|
Income taxes
|
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$
|
|
|
|
$
|
–
|
|
The accompanying notes are an integral
part of these unaudited condensed financial statement.
AS CAPITAL, INC.
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2020
(Unaudited)
NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS
AS Capital, Inc. (the “Company”)
was incorporated under the laws of the State of Nevada on June 15, 2006 as Jupiter Resources, Inc. On August 9, 2018, XTC, Inc.,
a Company owned by Chris Lotito, CEO, was awarded custodianship in a shareholder filing with the Eighth Judicial District Court
in Clark County Nevada. On April 30, 2018 the company filed an amendment to change the name of the corporation to Rineon Group,
Inc. On October 1, 2018, the company filed for a name change to AS Capital, Inc. The Company currently intends to serve as a vehicle
to effect an asset acquisition, merger, exchange of capital stock or other business combination with a domestic or foreign business
On June 4, 2019, the Company, XRC, LLC,
a Colorado limited liability company (“XRC”) and Xue Ran Gao (“Purchaser”) entered into a Stock Purchase
Agreement (the “SPA”), pursuant to which Purchaser agreed to purchase from XRC 11,000,000 shares of common stock of
the Company and 964 shares of Series A Preferred Stock of the Company, for aggregate consideration of Four Hundred Ten Thousand
Dollars ($410,000) in accordance with the terms and conditions of the SPA. XRC is the controlling shareholder of the Company. This
acquisition closed on July 18, 2019. As a result of the purchase, the Purchaser holds a controlling interest in the Company, and
may unilaterally determine the election of the Board and other substantive matters requiring approval of
the Company’s stockholders.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited interim financial
statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of
America and the rules of the Securities and Exchange Commission ("SEC") and should be read in conjunction with the audited
financial statements and notes for the year ended December 31, 2019. In the opinion of management, all adjustments, consisting
of normal recurring adjustments, necessary for a fair presentation of the results of operations for the interim periods presented
have been reflected herein. The results of operations for such interim periods are not necessarily indicative of operations for
the full year. Notes to the financial statements which would substantially duplicate the disclosures contained in the audited financial
statements for the most recent fiscal year ended December 31, 2019, have been omitted.
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. Actual results could differ from those estimates.
NOTE 3 – GOING CONCERN UNCERTAINTIES
As reflected in the accompanying unaudited
financial statements, the Company has no current operations from which to generate revenue, has an accumulated deficit of $36,281,739
at March 31, 2020 and had a net loss of $27,033 for the three months ended March 31, 2020. These factors raise substantial doubt
about our ability to continue as a going concern. The financial statements have been prepared assuming that the Company will continue
as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification
of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to
continue as a going concern.
NOTE 4 – SUBSEQUENT EVENTS
Management has evaluated subsequent events
pursuant to the requirements of ASC Topic 855, from the balance sheet date through the date the financial statements were available
to be issued, and has determined that there are no material subsequent events that require disclosure in these financial statements.
ITEM 2. MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORWARD-LOOKING STATEMENTS
This Form 10-Q includes
"forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included or
incorporated by reference in this Form 10-Q which address activities, events or developments which the Company expects or anticipates
will or may occur in the future, including such things as future capital expenditures (including the amount and nature thereof);
finding suitable merger or acquisition candidates; expansion and growth of the Company's business and operations; and other such
matters are forward-looking statements. These statements are based on certain assumptions and analyses made by the Company in light
of its experience and its perception of historical trends, current conditions and expected future developments, as well as other
factors it believes are appropriate under the circumstances. However, whether actual results or developments will conform with
the Company's expectations and predictions is subject to a number of risks and uncertainties, including general economic, market
and business conditions; the business opportunities (or lack thereof) that may be presented to and pursued by the Company; changes
in laws or regulation; and other factors, most of which are beyond the control of the Company.
These forward-looking
statements can be identified by the use of predictive, future-tense or forward-looking terminology, such as "believes,"
"anticipates," "expects," "estimates," "plans," "may," "will," or similar
terms. These statements appear in a number of places in this Filing and include statements regarding the intent, belief or current
expectations of the Company, and its directors or its officers with respect to, among other things: (i) trends affecting the Company's
financial condition or results of operations for its limited history; (ii) the Company's business and growth strategies; and, (iii)
the Company's financing plans. Investors are cautioned that any such forward-looking statements are not guarantees of future performance
and involve significant risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking
statements as a result of various factors. Such factors that could adversely affect actual results and performance include, but
are not limited to, the Company's limited operating history, potential fluctuations in quarterly operating results and expenses,
government regulation, technological change and competition.
Consequently, all of
the forward-looking statements made in this Form 10-Q are qualified by these cautionary statements and there can be no assurance
that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, that they
will have the expected consequence to or effects on the Company or its business or operations. The Company assumes no obligations
to update any such forward-looking statements.
General Business Development
AS Capital, Inc. (the
“Company”) was incorporated under the laws of the State of Nevada on June 15, 2006 as Jupiter Resources, Inc. On August
9, 2018, XTC, Inc., a Company owned by Chris Lotito, CEO, was awarded custodianship in a shareholder filing with the Eighth Judicial
District Court in Clark County Nevada. On April 30, 2018 the company filed an amendment to change the name of the corporation to
Rineon Group, Inc. On October 1, 2018, the company filed for a name change to AS Capital, Inc. The Company currently intends to
serve as a vehicle to effect an asset acquisition, merger, exchange of capital stock or other business combination with a domestic
or foreign business
On June 4, 2019, the
Company, XRC, LLC, a Colorado limited liability company (“XRC”) and Xue Ran Gao (“Purchaser”) entered into
a Stock Purchase Agreement (the “SPA”), pursuant to which Purchaser agreed to purchase from XRC 11,000,000 shares of
common stock of the Company and 964 shares of Series A Preferred Stock of the Company, for aggregate consideration of Four Hundred
Thousand Dollars ($410,000) in accordance with the terms and conditions of the SPA. XRC is the controlling shareholder of the Company.
This acquisition closed on July 18, 2019, and is more fully described in Note 4 – Subsequent Events. As a result of the purchase,
the Purchaser holds a controlling interest in the Company, and may unilaterally determine the election of the Board and other substantive
matters requiring approval of the Company’s stockholders.
Business Strategy
The Company, based
on proposed business activities, is a “blank check” company. The U.S. Securities and Exchange Commission defines those
companies as “any development stage company that is issuing a penny stock, within the meaning of Section 3 (a)(51) of the
Exchange Act of 1934, as amended, (the “Exchange Act”) and that has no specific business plan or purpose, or has indicated
that its business plan is to merge with an unidentified company or companies.” Under Rule 12b-2 of the Exchange Act, the
Company also qualifies as a “shell company,” because it has no or nominal assets (other than cash) and no or nominal
operations. Many states have enacted statutes, rules and regulations limiting the sale of securities of “blank check”
companies in their respective jurisdictions. Management does not intend to undertake any efforts to cause a market to develop in
our securities, either debt or equity, until we have successfully concluded a business combination. The Company intends to comply
with the periodic reporting requirements of the Exchange Act for so long as we are subject to those requirements.
The Company’s
principal business objective for the next 12 months and beyond such time will be to achieve long-term growth potential through
a combination with a business rather than immediate, short-term earnings. The Company will not restrict its potential candidate
target companies to any specific business, industry or geographical location and, thus, may acquire any type of business. We are
in active discussions with an operating company for a potential business combination. There is no assurance that we will be able
to successfully consummate such an acquisition or that following such acquisition we will be eligible to trade on a national securities
exchange, or be quoted on the Over-the-Counter.
Results of Operations
Comparison of the three months ended
March 31, 2020 and 2019.
Net Revenues.
We did not generate revenues during the three months ended March 31, 2020 and 2019.
General and Administrative
Expenses. We incurred general and administrative expenses of $27,033 and $3,754 during the three months ended March 31, 2020
and 2019, respectively.
Net Loss. We
incurred a net loss of $27,033 and $3,754 during the three months ended March 31, 2020 and 2019, respectively. The net losses consisted
solely of general and administrative expenses.
We are in active discussions
with an operating company for a potential business combination. In the event that we are able to successfully consummate such acquisition,
we expect our revenues and general and administrative expenses to increase as we expand our finance and administrative staff, add
infrastructure, and incur additional costs related to being reporting act company, including directors’ and officers’
insurance and increased professional fees.
Liquidity and Capital Resources
As of March 31, 2020,
we had total current assets of $0, and total current liabilities of $169,692 consisting of $31,159 of accrued expenses and $138,533
due to a related party. As of March 31, 2019, we had total current assets of $0 and total current liabilities of $142,659 consisting
of $21,596 of accrued expenses and $121,063 due to a related party.
Going Concern
We currently do not
generate sufficient funds from operations to finance our operations. Our auditors noted in our Annual Report on Form 10-K filed
with the Securities and Exchange Commission on March 20, 2020, that we experienced a working capital deficit of $142,659 and an
accumulated deficit of $36,254,706 at December 31, 2019. As such, our continuation as a going concern is dependent upon improving
our profitability and the continuing financial support from our stockholders. While we believe that existing shareholders will
continue to provide the additional cash to meet our obligations as they become due, there can be no assurance that we will be able
to raise such additional capital resources on satisfactory terms. We believe that our current cash and other sources of liquidity
discussed below are adequate to support general operations for at least the next 12 months.
|
|
Three Months Ended March 31,
|
|
|
|
2020
|
|
|
2019
|
|
Net cash generated from (used in) operating activities
|
|
$
|
(17,470
|
)
|
|
$
|
(3,204
|
)
|
Net cash (used in) provided by investing activities
|
|
$
|
–
|
|
|
$
|
–
|
|
Net cash provided by financing activities
|
|
$
|
17,470
|
|
|
$
|
6,000
|
|
Net Cash Used In Operating
Activities.
Net cash used in operating activities
was $17,470 compared to$3,204 for the three months ended March 31, 2020 and 2019.
Net Cash Generated From (Used In) Investing
Activities.
Investing activities
did not provide us with any net cash during the three months ended March 31, 2020, and 2019.
Net Cash Provided By Financing Activities.
Net cash provided by
financing activities was $17,470 compared to $6,000 for the three months ended March 31, 2020, and 2019. Cash from financing activities
consisted entirely of related party proceeds.
Critical accounting policies
The
preparation of our financial statements requires management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period. On an on-going basis, management evaluates its estimates
and judgments which are based on historical experience and on various other factors that are believed to be reasonable under the
circumstances. The results of their evaluation form the basis for making judgments about the carrying values of assets and liabilities.
Actual results may differ from these estimates under different assumptions and circumstances. Our significant accounting policies
are more fully discussed in Note 2 to our financial statements contained herein.
Recent accounting pronouncements
The Company has reviewed
all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements
may be expected to cause a material impact on its financial condition or the results of its operations.