UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
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Annual Report Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
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For the
fiscal year ended
December 31, 2016
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☐
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Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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For the transition period from ______________to ______________
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Commission
File Number 000-50760
SANCON
RESOURCES RECOVERY, INC.
(Exact Name of Registrant as Specified in
Its Charter)
State of Nevada, USA
(State or Other Jurisdiction of Incorporation
or Organization)
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58-2670972
(I.R.S. Employer Identification No.)
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602 Nan Fung Tower, Suite 6/F
88 Connaught Road Central
Central District, Hong Kong
(Address of Principal
Executive Offices)
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N/A
(Zip Code)
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+ (852) 2868-0668
(Registrant’s Telephone Number, Including
Area Code)
Securities registered pursuant to Section
12(b) of the Act:
Title of Each Class
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Name of Each Exchange on Which Registered
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None
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N/A
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Securities registered pursuant to Section
12(g) of the Act:
Common Stock, par value $0.001 per share
Indicate by check mark if the registrant is a well-known seasoned
issuer, as defined in Rule 405 of the Securities Act. ☐ Yes ☒ No
Indicate by check mark if the registrant is not required to
file reports pursuant to Section 13 or Section 15(d) of the Act. ☐ Yes ☒ No
Indicate by check mark whether the registrant (1) has
filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirement
for the past 90 days. ☒ Yes ☐ No
Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant
to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). ☒ Yes ☐ No
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of
the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form10-K ☐ Yes ☒No
Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
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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Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act). ☒ Yes ☐ No
The aggregate market value of voting stock
held by non-affiliates of the registrant as of June 30, 2016 was approximately $541,997 (based upon a closing price of $0.02 per
share, as reported on Yahoo Finance). As of December 31, 2016, there were 105,091,254 shares of the registrant’s common stock
outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
List hereunder the following documents
if incorporated by reference and the Part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated:
(1) Any annual report to security holders; (2) Any proxy or information statement; and (3) Any prospectus filed pursuant to Rule
424(b) or (c) under the Securities Act of 1933.
None.
TABLE OF CONTENTS
Forward Looking Statements
CAUTIONARY NOTE ABOUT FORWARD-LOOKING
STATEMENTS
The information contained in this Report
includes some statements that are not purely historical and that are “forward-looking statements” within the meaning
of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), and as such, may involve risks and uncertainties. These forward-looking
statements relate to, among other things, expectations of the business environment in which we operate, perceived opportunities
in the market and statements regarding our mission and vision. In addition, any statements that refer to projections, forecasts
or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements.
You can generally identify forward-looking statements as statements containing the words “anticipates,” “believes,”
“continue,” “could,” “estimates,” “expects,” “intends,” “may,”
“might,” “plans,” “possible,” “potential,” “predicts,” “projects,”
“seeks,” “should,” “will,” “would” and similar expressions, or the negatives of
such terms, but the absence of these words does not mean that a statement is not forward-looking.
Forward-looking statements involve risks
and uncertainties that could cause actual results or outcomes to differ materially from those expressed in the forward-looking
statements. The forward-looking statements contained herein are based on various assumptions, many of which are based, in turn,
upon further assumptions. Our expectations, beliefs and forward-looking statements are expressed in good faith on the basis of
management’s views and assumptions as of the time the statements are made, but there can be no assurance that management’s
expectations, beliefs or projections will result or be achieved or accomplished. We disclaim any obligation to update forward-looking
statements to reflect events or circumstances after the date hereof.
PART I
ITEM 1. BUSINESS
Business Combination and Corporate Restructuring
Effective May 26, 2006, a business combination
occurred between Sancon Recycling Pty Ltd. (“SRPL”) and MKA Capital Inc. (hereinafter referred to as "MKAC").
The combination was effected by MKAC exchange its seventy-five percent (75%) equity stake in MK Aviation, S.A. (hereinafter referred
to as "MKA") for one hundred percent (100%) equity stake in SRPL held by Mr. Jack Chen, Mr. Yiu Lo Chung, and associated
parties (“the Shareholders”). Meanwhile, the Shareholders exchanged their ownership of seventy-five percent (75%) equity
stake in MK Aviation, S.A. with 14,897,215 shares of the Registrant's common stock from Mr. Kraselnick and associated parties.
Subsequently MKAC was renamed Sancon Resources Recovery, Inc. (herein below referred to as “the Company” or “Sancon”).
As a result of the merger, there was a
change in control of the public entity MKAC. In accordance with SFAS No. 141, SRPL was the acquiring entity. While the transaction
is accounted for using the purchase method of accounting, in substance the Agreement is a recapitalization of the Company's capital
structure. For accounting purposes, SRPL accounted for the transaction as a reverse acquisition and SRPL is the surviving entity.
SRPL did not recognize goodwill or any intangible assets in connection with the transaction.
Effective with the Agreement, the Shareholders
owned 14,897,215 shares of MKAC voting common stock or 74.28% of the Registrant's 20,030,370 issued and outstanding voting common
stock at the time.
All references to common stock, share and per share amounts
had been retroactively restated to reflect the exchange of 100 shares of SRPL common stock for 14,897,215 shares of the MKAC's
common stock outstanding immediately prior to the merger as if the exchange had taken place as of the beginning of the earliest
period presented.
The accompanying financial statements present
the historical financial condition, results of operations and cash flows of Sancon as of December 31, 2016.
Business of the Issuer
Overview of the Company and its Operations
During the period from June 2006 to October 2011, Sancon Resources
Recovery, Inc. had been an industrial waste recycling company with operations based in Australia and China. Sancon\'s main operations
and services included industrial waste management consulting, collection and reprocess of recyclable materials such as glass, plastic,
cardboard, and paper.
The business operation of the Company was carried out through
its subsidiaries listed below. In 2011, the Company divested all its subsidiaries. The status of the subsidiaries as of the year
end 2011 is given below.
Registered Name
(business is conducted under the registered names)
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Domicile
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Owner
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% held
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Sancon Recycling Pty Ltd. (“Sancon AU” hereinafter)
Status: The company was under administration and wound up by the directors.
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Australia
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Sancon
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100
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Sancon Resources Recovery (Shanghai) Co., Ltd. ("Sancon SH" hereinafter)
Status: The shareholding was sold to Mr. Jack Chen on October 31, 2011.
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Shanghai
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Sancon
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70
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Crossover Solutions Inc. ("CS" hereinafter)
Status: The shareholding was sold to Mr. Jack Chen on October 31, 2011.
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British Virgin Island
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Sancon
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100
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Sheng Rong Environment Protection Technology Co., Ltd. (“Shanghai Sheng Rong” hereinafter)
Status: The company was owned by Sancon SH which was sold to Mr. Jack Chen on October 31, 2011.
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Shanghai
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Sancon SH
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52
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On September 30, 2011, Sancon entered into
a Stock Sale and Purchase Agreement to transfer its 70% controlling interest in Sancon Resources Recovery (Shanghai) Co., Ltd.
and 100% interest of its associated company Crossover Solutions, Inc to Mr. Jack Chen, the Company’s Chief Executive Officer
and Director.
Under the terms of the Agreement, the purchase
price was to be settled upon closing of the transaction by returning to the Company a total of 10,100,000 common shares, representing
44% of the total issued and outstanding shares of Sancon. As of October 31, 2011, a total of 10,100,000 shares of Sancon had been
received and subsequently cancelled by the Company.
The Company is a controlled corporation
with the substantial majority of our shares held by Pontoon Boat Inc. (“Pontoon”), a company registered in the Republic
of Vanuatu. Pontoon acquired a 51% common shares of the Company in July 2016. As a result, there can be no assurance that business
and/or strategy of the Company will not change over time as a result of Pontoon’s acquisition.
Our Strategy
We do not currently engage in any business activity. Our principal
business objective will be to achieve long-term growth potential through a combination with a business rather than immediate, short-term
earnings.
We may consider a business which has recently commenced operations,
is a developing company in need of additional funds for expansion into new products or markets, is seeking to develop a new product
or service, or is an established business which may be experiencing financial or operating difficulties and is in need of additional
capital. In the alternative, a business combination may involve the acquisition of, or merger with, a company which does not need
substantial additional capital, but which desires to establish a public trading market for its shares, while avoiding, among other
things, the time delays, significant expense, and loss of voting control which may occur in a public offering.
Any target business that is selected may be a financially unstable
company or an entity in its early stages of development or growth, including entities without established records of sales or earnings.
In that event, we will be subject to numerous risks inherent in the business and operations of financially unstable and early stage
or potential emerging growth companies.
Our management anticipates that it will likely be able to effect
only on business combination, due primarily to our limited financing, and the dilution of interest for current stockholders, which
is likely to occur as a result of our management's plan to offer a controlling interest to a target business in order to achieve
tax free reorganization.
Because of general economic conditions,
rapid technological advances being made in some industries and shortages of available capital, our management believes that there
are numerous firms seeking the perceived benefits of becoming a publicly traded corporation. Potentially available business combinations
may occur in many different industries and at various stages of development, all of which will make the task of comparative investigation
and analysis of such business opportunities extremely difficult and complex.
Evaluation of Business Combinations
Our management intends to concentrate on
prospective business combinations that may be brought to its attention through their own efforts, through persons having pre-existing
business or personal relationships with members of the Company's management and interested persons referred to the Company by persons
having such pre-existing relationships with members of its management or other third parties.
While we have not established definitive criteria for acquisition
candidates but intend to focus on Asian-based entities. In analyzing prospective business combinations, our management will also
consider such matters as the following:
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Available technical, financial, and managerial resources,
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Working capital and other financial requirements,
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Prospects for the future,
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Nature of present and expected competition,
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The potential for further research, development, or exploration,
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The potential for growth or expansion, and
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The potential for profit.
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As a part of our investigation, our officers
and/or directors will meet personally with management and key personnel, visit and inspect material facilities, check references
of management and key personnel, and take other reasonable investigative measures, to the extent of our limited financial resources
and management expertise.
Intellectual Property
None.
Employees
As of December 31, 2016, the Company had no employees.
Factors That May Affect Future Results
The Company's ability to execute its business
strategy and to sustain its operations depends upon its ability to maintain or procure capital. There can be no absolute assurance
the necessary amount of capital will continue to be available to the Company on favorable terms, or at all. The Company's inability
to obtain sufficient capital would limit the Company's ability to: (i) acquire new business and (ii) fund its working capital needs.
The Company's access to capital may have a material adverse effect on the Company's business, financial condition and/or results
of operations.
There can be no absolute assurance the
Company will be able to effectively manage its existing or the possible future expansion of its operations, or the Company's systems,
procedures or controls will be adequate to support future Company operations. Consequently, the Company's business, financial condition
and/or results of operations could be possibly and adversely affected.
The Company does not foresee changes in
tax laws for the jurisdictions in which the Company operates. There can be no absolute assurance that changes will not occur, and
therefore no absolute assurance such changes will not materially and adversely affect the Company's business, financial condition
and future results of operations.
As a public company, Sancon is subject
to certain regulatory requirements including, but not limited to, compliance with Section 404 of the Sarbanes-Oxley Act of 2002
("SOX404"). Such compliance results in significant additional costs to the Company by increased audit and consulting
fees, and the time required by management to address the regulations.
ITEM 1A. RISK FACTORS
This information is not required of smaller reporting companies.
ITEM 1B. UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 2. PROPERTIES
The Company does not own or have any leased property as of December
31, 2016. The corporate office is provided to the Company by Fintel (USA) Limited. Mr. Stephen Tang, the previous CEO and President
of the Company, is a principal owner of Fintel (USA) Limited.
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
PART II
ITEM 5. MARKET FOR REGISTRANT’S
COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
The Company’s stock is assigned the symbol SRRY and is
quoted and traded on the OTCPK.
The range of low to high closing prices
on the OTCPK is shown in the table below (rounded to the nearest cent). This information is taken from MSN Money and CSI. Readers
should note OTCPK quotations are a reflection of inter-dealer prices, without retail mark-up, mark-down, or commissions, and may
not represent actual transactions.
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Fiscal 2016
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Fiscal 2015
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Quarter
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$ High Closing Price
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$ Low Closing Price
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$ High Closing Price
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$ Low Closing Price
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First
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0.016
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0.003
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0.01
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0.004
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Second
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0.024
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0.002
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0.02
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0.010
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Third
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0.025
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0.006
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0.02
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0.008
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Fourth
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0.014
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0.008
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0.01
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0.002
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Holders of the Company’s Stock
The Company has issued common stock only. On December 31, 2016,
the total number of holders of record as according to our transfer agent was approximately 300.
Dividends
We did not pay any cash dividends on our common stock for fiscal
year ended on December 31, 2016.
Unregistered Sales of Equity Securities
date
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type
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amount
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person
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consideration
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transaction
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4-Feb-16
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Common share
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3,000,000
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Tang Wai Leong
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$6,000
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New Subscription of shares
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4-Feb-16
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Common share
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4,000,000
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Wong Yee Tat
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$8,000
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New Subscription of shares
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4-Feb-16
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Common share
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3,500,000
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Tam Wai Hung
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$7,000
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New Subscription of shares
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4-Feb-16
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Common share
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3,500,000
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Lam Chi Pan
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$7,000
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New Subscription of shares
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4-Feb-16
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Common share
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3,500,000
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To Hoi Yi
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$7,000
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New Subscription of shares
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4-Feb-16
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Common share
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3,500,000
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Wu Wai Fan
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$7,000
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New Subscription of shares
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4-May-16
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Common share
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15,771,429
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Francis Bok
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$55,200
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Settlement of director fee from Mar 13, 2014 to Jun 30, 2016
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4-May-16
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Common share
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15,771,429
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Stephen Tang
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$55,200
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Settlement of director fee from Mar 13, 2014 to Jun 30, 2016
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4-May-16
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Common share
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11,040,000
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Angel Lai
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$27,600
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Settlement of secretary fee from Mar 13, 2014 to Jun 30, 2016
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4-May-16
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Common share
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9,288,400
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Fintel (USA) Ltd
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$23,221
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Settlement of accounting fee from Dec 22, 2013 to Jun 30, 2016
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The number of shares issued was based on the average closing
price of our common shares on the OTCPK during certain periods. The shares were exempt from registration pursuant to Section 4(2)
under the Securities Act of 1933, as amended, pursuant to Rule 903, as a sale by the issuer in an offshore transaction. No underwriting
or other commissions were paid in connection with the issuance of these shares. No forms of conversion or exercise options are
attached to the shares.
ITEM 6. SELECTED FINANCIAL DATA
This information is not required of smaller reporting companies.
ITEM 7. MANAGEMENT’S DISCUSSION
AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion contains forward-looking
statements. Forward looking statements are identified by words and phrases such as “anticipate”, “intend”,
“expect” and words and phrases of similar import. We caution investors that forward-looking statements are only predictions
based on our current expectations about future events and are not guarantees of future performance. Our actual results, performance
or achievements could differ materially from those expressed or implied by the forward-looking statements due to risks, uncertainties
and assumptions that are difficult to predict. We encourage you to read carefully the other information provided in this Report
and in our other filings with the SEC before deciding to invest in our stock or to maintain or change your investment. We undertake
no obligation to revise or update any forward-looking statement for any reason, except as required by law.
You should read this MD&A in conjunction with the Financial
Statements and Related Notes in Item 8.
Overview
Sancon Resources Recovery, Inc. was an
industrial waste recycling company with operations based in Australia and China. Sancon exported more than 4,000 tons of recycled
industrial waste material annually to its processing partners and manufacturers in China. Sancon's main operations and services
included industrial waste management consulting, collection and reprocess of recyclable materials such as glass, plastic, cardboard,
and paper before its re-entry into manufacture cycles as raw materials. The use of recycled material is both environmentally friendly
and is a key part of the competitive manufacturing process to lower costs. Chinese manufacturers are increasingly turning to recycled
materials to lower costs. The major customers for Sancon were Chinese manufacturers and recycled material traders such as Pernod
Ricard, Hing Yang Hong, which are located mainly in the Chinese provinces of Shanghai, Guangdong, Zhejiang and Fujian.
The business operation of the Company was
carried out through its subsidiaries. In 2011, the Company divested all its subsidiaries. The Company currently has no active business
activities.
Plan of Operation
The Company is actively looking for acquisition and merger opportunities
in growth industries in Asia.
Critical Accounting Policies and Estimates
The preparation of our financial statements
in conformity with accounting principles generally accepted in the United States requires us to make estimates and judgments that
affect our reported assets, liabilities, revenues, and expenses, and the disclosure of contingent assets and liabilities. We base
our estimates and judgments on historical experience and on various other assumptions we believe to be reasonable under the circumstances.
Future events, however, may differ markedly from our current expectations and assumptions. While there are a number of significant
accounting policies affecting our financial statements; we believe the following critical accounting policies involve the most
complex, difficult and subjective estimates and judgments: allowance for doubtful accounts; income taxes; stock-based compensation;
asset impairment.
Revenue Recognition
In accordance with generally accepted accounting
principles ("GAAP") in the United States, revenue is recognized only when the price is fixed or determinable, persuasive
evidence of an arrangement exists, the service is performed, and collection of the resulting receivable is reasonably assured.
Noted below are brief descriptions of the product or service revenues that the Company recognizes in the financial statements contained
herein.
The Company was organized into two businesses:
material recycling and waste management service. Their revenue recognition is as follows:
(1) Material Recycling refers to the activities
of collecting and processing of waste materials, then selling them to customers in China. The plant is located in Australia. The
revenue is recognized when delivery of the material is occurred and invoice issued.
(2) Waste Management Service refers the
activities of providing waste management service with operations located in Shanghai China. The revenue is recognized when service
is completed and invoice is issued.
Allowance for doubtful accounts
We maintain an allowance for doubtful accounts
to reduce amounts to their estimated realizable value. A considerable amount of judgment is required when we assess the realization
of accounts receivables, including assessing the probability of collection and the current credit-worthiness of each customer.
If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make payments,
an additional provision for doubtful accounts could be required. We initially record a provision for doubtful accounts based on
our historical experience, and then adjust this provision at the end of each reporting period based on a detailed assessment of
our accounts receivable and allowance for doubtful accounts. In estimating the provision for doubtful accounts, we consider: (i)
the aging of the accounts receivable; (ii) trends within and ratios involving the age of the accounts receivable; (iii) the customer
mix in each of the aging categories and the nature of the receivable; (iv) our historical provision for doubtful accounts; (v)
the credit worthiness of the customer; and (vi) the economic conditions of the customer’s industry as well as general economic
conditions, among other factors.
Income taxes
We account for income taxes in accordance
with SFAS No. 109(ASC 740), Accounting for Income Taxes. SFAS 109 prescribes the use of the liability method. Under this method,
deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between
the financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities are measured
using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected
to be recovered or settled. We then assess the likelihood that our deferred tax assets will be recovered from future taxable income
and to the extent we believe that recovery is not likely, we establish a valuation allowance. To the extent we establish a valuation
allowance, or increase or decrease this allowance in a period, we increase or decrease our income tax provision in our statement
of operations. If any of our estimates of our prior period taxable income or loss prove to be incorrect, material differences could
impact the amount and timing of income tax benefits or payments for any period. In addition, as a result of the significant change
in the Company’s ownership, the Company's future use of its existing net operating losses may be limited.
The Company operated in several countries.
As a result, we were subject to numerous domestic and foreign tax jurisdictions and tax agreements and treaties among the various
taxing authorities. Our operations in these jurisdictions were taxed on various bases: income before taxes, deemed profits and
withholding taxes based on revenue. The calculation of our tax liabilities involved consideration of uncertainties in the application
and interpretation of complex tax regulations in a multitude of jurisdictions across our global operations.
We recognize potential liabilities and
record tax liabilities for anticipated tax audit issues in the U.S. and other tax jurisdictions based on our estimate of whether,
and the extent to which, additional taxes will be due. The tax liabilities are reflected net of realized tax loss carry forwards.
We adjust these reserves upon specific events; however, due to the complexity of some of these uncertainties, the ultimate resolution
may result in a payment that is different from our current estimate of the tax liabilities. If our estimate of tax liabilities
proves to be less than the ultimate assessment, an additional charge to expense would result. If payment of these amounts ultimately
proves to be less than the recorded amounts, the reversal of the liabilities would result in tax benefits being recognized in the
period when the contingency has been resolved and the liabilities are no longer necessary.
Changes in tax laws, regulations, agreements
and treaties, foreign currency exchange restrictions or our level of operations or profitability in each taxing jurisdiction could
have an impact upon the amount of income taxes that we provide during any given year.
Stock-Based Compensation
Effective January 1, 2006, the beginning
of Sancon's first fiscal quarter of 2006, the Company adopted the fair value recognition provisions of SFAS 123R (ASC 718), using
the modified-prospective transition method. Under this transition method, stock-based compensation expense was recognized in the
financial statements for granted stock options, since the related purchase discounts exceeded the amount allowed under SFAS 123R(ASC
718) for non-compensatory treatment. Compensation expense recognized included: the estimated expense for stock options granted
on and subsequent to January 1, 2006, based on the grant date fair value estimated in accordance with the provisions of SFAS 123R
(ASC 718); and the estimated expense for the portion vesting in the period for options granted prior to, but not vested as of January
1, 2006, based on the grant date fair value estimated in accordance with the original provisions of SFAS 123(ASC 718). Results
for prior periods have not been restated, as provided for under the modified-prospective method.
On December 5, 2012, the Company entered
into a settlement agreement with Dragon Wings for the settlement of the claim by Dragon Wings. In consideration of Sancon's agreement
to make the payments in the form of common shares and share options listed in the settlement agreement. The Company would give
the option to Dragon Wings to purchase 6,000,000 common shares; the option may be exercised by Dragon Wings in whole or in part,
at any time within 5 years from the date of this settlement agreement with the exercise price at US$0.01 per share, with dilution
protection and subject to share split adjustment.
For other items paid for by common stock,
the value of the transaction is determined by the value of the goods or services received, measured at the time of the transaction.
The corresponding stock value, used to determine the number of share to be issued, is the value of the average price for the 20
to 30 days prior to the transaction date.
Asset Impairment
We periodically evaluate the carrying value
of other long-lived assets, including, but not limited to, property and equipment and intangible assets, when events and circumstances
warrant such a review. The carrying value of a long-lived asset is considered impaired when the anticipated undiscounted cash flows
from such asset is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying
value exceeds the fair value of the long-lived asset. Fair value is determined primarily using the anticipated cash flows discounted
at a rate commensurate with the risk involved. Significant estimates are utilized to calculate expected future cash flows utilized
in impairment analyses. We also utilize judgment to determine other factors within fair value analyses, including the applicable
discount rate.
Results of Operations
Two Years Ended December 31, 2016
and 2015
Revenue
The Company had no revenues in 2016 and
2015.
Other Income
We had other income of $1,230 in 2016 and
$nil in 2015, attributable to the write-off of amount due to related party.
General and administrative expenses
General and administrative expenses increased
to $85,643 for the year 2016, from $74,147 for the year 2015, an increase of $11,496. Of these amounts, $30,000 and $60,000 related
to the value of cash compensation to our directors and secretary in each of 2016 and 2015, respectively. In addition, a substantial
portion of our expenses for the year ended December 31, 2016 related to accounting service fees, audit fees, and legal and professional
service fees, and for the year ended December 31, 2015 related to accounting service fees, audit fees, professional service fees
and transfer agent fees.
Income Tax
No income tax was provided for the year
2016 and 2015.
Net loss
The net loss for the year 2016 was $84,413,
compared to the net loss of $74,147 in 2015, an increase of $10,266.
Liquidity and Capital Resources
As shown in the accompanying financial
statements, the Company had an accumulated loss of $1,219,286 as of December 31, 2016 compared to the accumulated loss of $1,134,873
for the year ended December 31, 2015. There was a working capital deficit of $102,110 on December 31, 2016 and it was $220,918
as of December 31, 2015. It decreased $118,808.
Operating Activities
$203,221 net cash flows used in operating
activities for the year 2016 and $nil used for the year 2015, due to a significant decrease in respect of liabilities due to related
parties and accrued expenses and other payable in 2016. The liabilities are settled by the issuance of common shares in 2016.
Investing Activities
No net cash was used in investing activities
for the year 2016 and 2015. The Company did not purchase any property or equipment in 2016 and 2015.
Financing Activities
$203,221 net cash flows provided by financing
activities for the year 2016 and $nil provided for the year 2015. The net cash flows provided for the year 2016 is due to the issuance
of common shares.
The Company financed its growth by utilizing
cash reserves and loans from directors. Loans from directors were unsecured, and deferred payment term and without interest bearing.
The Company’s primary use of funds was for investigating potential merger/acquisition candidates and for working capital.
Inflation
In the opinion of management, inflation
has not had a material effect on the Company's financial condition or results of its operations.
Trends and uncertainties
Management believes there are no known
trends, events, or uncertainties that could, or reasonably be expected to, adversely affect the Company’s liquidity in the
short and long terms, or its net sales, revenues, or income from continuing operations.
Off-Balance Sheet Arrangements
There are no off-balance sheet arrangements
that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources, that are material
to investors.
ITEM 7A. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK
This information is not required of smaller
reporting companies.
ITEM 8. FINANCIAL STATEMENTS AND
SUPPLEMENTARY DATA
Financial statements are attached hereto
following Part IV, Item 15 beginning on Page F-1 of this Annual Report.
ITEM 9. CHANGES IN AND DISAGREEMENTS
WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
We engaged Dominic K.F. Chan & Co.
as our independent accountant on August 20, 2012.
Effective from May 1, 2016, DCAW (CPA)
Ltd. has succeeded from Dominic K.F. Chan & Co., the license to audit U.S. public company regulated by PCAOB. The principals
and staff of DCAW (CPA) Ltd. are the same auditors and staff who were engaged on the audit of the Company while at Dominic K.F.
Chan & Co.
On August 12, 2016, the Company engaged
Anthony Kam & Associates Ltd. ("AKAM"), as its new independent registered public accountant. The decision to engage
AKAM was recommended and approved by the Company’s Board of Directors.
ITEM 9A. CONTROLS AND PROCEDURES
Under the supervision and with the participation
of our management, including our principal executive officer and the principal financial officer, we conducted an evaluation of
the effectiveness of the design and operation of its disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as of the end of the period covered by this report (the "Evaluation Date").
Based on this evaluation, our principal executive officer and principal financial officer concluded as of the Evaluation Date,
that our disclosure controls and procedures were not effective.
Managements' Annual Report on Internal
Control over Financial Reporting
Management is responsible for establishing
and maintaining adequate internal control over financial reporting of the Company. Internal control over financial reporting is
a process designed by, or under the supervision of, our chief executive and chief financial officers and effected by our board
of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
Our management assessed the effectiveness
of the Company’s internal control over financial reporting as of December 2016. The framework used by management in making
that assessment was the 2013 version of the criteria set forth in the document entitled “Internal Control-Integrated Framework”
issued by the Committee of Sponsoring Organizations of the Treadway Commission.
Based on our evaluation described above,
management has concluded that our internal control over financial reporting was not effective as of December 31, 2016. We have
limited resources and we rely heavily on direct management oversight of transactions, along with the use of legal and accounting
professionals. As we grow we will hire skilled professionals that will enable us to implement adequate segregation of duties within
the internal control framework.
Our management will also implement additional
review procedures designed to ensure that the disclosure provided by the Company meets the current requirements of the applicable
filing made under the Exchange Act and methodology to review the statements.
This annual report does not include an
attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation requirements by our registered public accounting firm pursuant to temporary
rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this annual
report.
Changes in Internal Control Over Financial
Reporting
There was no change in our internal control
over financial reporting that occurred during the fiscal year ended December 31, 2016 that has materially affected, or is reasonably
likely to materially affect, our internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
Effective June 28, 2016, the Board of Directors
(the “Board”) of Sancon Resources Recovery, Inc. (the “Company”) increased the size of the Board from two
to four directors and elected Ms. HE, Qianying and Mr. KOK, Seng Yeap as directors to fill the newly created vacancy on the Board.
On
July 4, 2016, Pontoon Boat Inc. (“Pontoon”) purchased a total of 53,596,540 common shares of the Company at US$0.0017
per share, representing 51% of the Company’s outstanding common shares. The shares were purchased for cash from the following
persons:
Name
|
|
Number of
shares
|
|
|
|
|
|
Wai Hung TAM
|
|
|
3,500,000
|
|
Chi Pan LAM
|
|
|
3,500,000
|
|
Wai Leong TANG
|
|
|
3,000,000
|
|
Yee Tat WONG
|
|
|
4,000,000
|
|
Hoi Yi TO
|
|
|
3,500,000
|
|
Wai Fan WU
|
|
|
3,500,000
|
|
Francis BOK
|
|
|
13,144,867
|
|
Stephen TANG
|
|
|
13,144,867
|
|
Shuk Har LAI
|
|
|
6,306,806
|
|
Pontoon
is a limited liability company registered in the Republic of Vanuatu. Pontoon is wholly owned by its director, Mr. KOK Seng Yeap.
Mr. KOK is also a director of the Company and he provided the financing to Pontoon to purchase the Company’s shares. The
financing is interest free and has no definite repayment schedule.
There
is no agreement between Pontoon and its owners and the former Company stockholders regarding election of directors or any other
matters.
On September 30, 2016, Stephen Tang and Francis Bok resigned
from the Board and their respective executive positions of the Company as part of the Company’s management reorganization.
The resignation by each of these individuals did not involve any disagreements with the Company or the management of the Company.
In connection with the departure of the aforementioned individuals
the Company’s Board named the following director as current officer:
|
·
|
KOK Seng Yeap (Chief Executive Officer)
|
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS
AND CORPORATE GOVERNANCE
Identification and Backgrounds of Directors
and Officers
Name
|
|
Age
|
|
|
Principal Position
|
|
Appointment/Resignation date
|
Stephen Tang
|
|
|
64
|
|
|
CEO, President, Director
|
|
May 21, 2012/September 30, 2016
|
Francis Bok
|
|
|
50
|
|
|
CFO, Director
|
|
May 21, 2012/September 30, 2016
|
Kok Seng Yeap
|
|
|
63
|
|
|
CEO, Director
|
|
June 28, 2016
|
He Qianying
|
|
|
47
|
|
|
Director
|
|
June 28, 2016
|
Mr. Stephen Tang
,
Chief Executive
Officer, President & Director
Mr. Tang served as our President, Chief
Executive Officer and Chairman of our board of directors from May 2012 to September 2016. Mr. Tang is the Chairman of Mega Pacific
Capital, Inc., a finance and investment consulting firm since 2005. Mr. Tang was the director and Chairman of Financial Telecom
Limited (USA), Inc. (later changed its name to MKA Capital, Inc. then Sancon Resources Recovery, Inc.). Mr. Tang is currently
the Vice President of the Hong Kong Information Technology Federation and a director of Professional Commons, a think tank in Hong
Kong. Mr. Tang is a graduate of Hong Kong Baptist University and received his MBA from the Asian Institute of Management
in Manila, Philippines, in 1976.
Mr. Francis Bok
,
Chief Financial
Officer & Director
Mr. Bok
served as a director
and Chief Financial Officer of the Company from May 2012 to September 2016. Mr. Bok serves as the chief executive officer of Beyond
IVR Limited, an information technology company based in Hong Kong. During 2004, Mr. Bok served as the assistant manager for Kactus
Limited, a Hong Kong based mobile content and applications provider. From 2002 until 2004, Mr. Bok was a Manager at Continuous
Technologies International Limited in Hong Kong. Mr. Bok received his Bachelor in Mathematics in 1993 from the University of Waterloo,
Canada, a Master of Science in 1997 from the University of Hong Kong, and an MBA in 2000 from the City University of Hong Kong.
Mr. Kok Seng Yeap, Chief Executive
Officer & Director
Mr. Kok currently serves as the Company’s
Director and Chief Executive Officer. In addition to his service with the Company, Dato’ Kok serves in various other capacities,
including Chairman, Chief Executive Officer, President, Chief Financial Officer, Secretary and Treasurer at Toga Capital Limited,
positions held since August 2015, Chief Executive Officer, President and Chief Financial Officer at Gold Billion Group Holdings
Limited, positions held since November 2014, and Associate Director of First Asia Holdings Limited, a position held since November
2013. Dato’ Kok is also the Owner of RichCorp Holdings Ltd and has previously served as Managing Director of NobleCorp Asset
Management Ltd and as an advisor for Hengyep International Wealth Management (Hong Kong) and IVP Holding Co. Ltd (Singapore). Dato’
Kok has served as a director of Gold Billion Group Holdings Limited since November 2014 and Kingsburg Holdings Limited since 2012.
Dato’ Kok has received qualifications from the Malaysia Insurance Institute and Rockwills Sdn Bhnd, Malaysia. We believe
Dato’ Kok’s vast experience in the financial industry qualifies him to service as Vice-Chairman.
Ms. He Qianying, Director
Ms.
He currently serves as the Company’s Director.
Participate to work since 1991, graduated
from Chengdu Qingbaijiang Middle School, present as the chairman of Sichuan Xiangtian Ecological Agriculture Development Co., Lt
d.
She is responsible in planning, directing, and implementing key strategic commercial initiatives for the organization.
Family relationships
There are
no family relationships among any of our directors or executive officers.
Section 16(a) Beneficial Ownership Reporting
Compliance
Under Section 16(a) Beneficial Ownership
Reporting Compliance, each person who was at any time during the fiscal year, a director, officer, beneficial owner of more than
ten percent of any class of equity securities of the Company registered pursuant to section 12 (“reporting person”)
is required to file Forms 3, 4, and 5 on a timely basis, during the most recent fiscal year or prior fiscal years. Due to lack
of knowledge, the relevant beneficial owners did not file on time. They will file Form 3 and Form 5 shortly.
Code of Ethics
The Company has Standards of Ethical Conduct
Policy (“Code of Ethics”) that applies to all employees and directors, including the Chairman, Chief Executive Officer,
and Chief Financial Officer.
Committees of our Board of Directors
Audit Committee
We do not have a formal standing audit
committee. Rather, audit committee functions are performed by our entire Board of Directors. These functions include: (1) selection
and oversight of our independent accountant; (2) establishing procedures for the receipt, retention and treatment of complaints
regarding accounting, internal controls and auditing matters; (3) establishing procedures for the confidential, anonymous submission
by our employees of concerns regarding accounting and auditing matters; (4) engaging outside advisors; and (5) funding for the
outside auditory and outside advisors engagement by the audit committee.
Audit Committee Financial Expert
None of our directors or officers has the
qualifications or experience to be considered a financial expert. We believe that the cost related to retaining a financial expert
at this time is prohibitive. However, we do intend to appoint an audit committee financial expert in the foreseeable future.
Director Independence
None of the members of our Board of Directors
may be deemed to be independent under the standards for independence contained in the NASDAQ Marketplace Rules, Rule 4350(d) and
Rule 4200(a)(15).
Compensation Committee
Compensation committee functions are performed
by our entire Board of Directors. Our Board of Directors does not have a charter or other formal policies regarding compensation.
Nominating and Corporate Governance
Committee
Nominating and Corporate Governance committee
functions are performed by our entire Board of Directors. Our Board of Directors does not have a charter or other formal policies
regarding director nominations or corporate governance.
Stockholder Communications
Any stockholder may communicate directly
to our Board of Directors by sending a letter to our company’s address of record.
|
•
|
encourage their commitment;
|
|
|
|
|
•
|
motivate superior performance;
|
|
|
|
|
•
|
facilitate attainment of ownership interests in our company;
|
|
|
|
|
•
|
align personal interests with those of our stockholders; and
|
|
|
|
|
•
|
enable them to share in the long-term growth and success of our company.
|
ITEM 11. EXECUTIVE COMPENSATION
Officers’ compensation
From May 21, 2012 to June 30, 2016, Mr.
Stephen Tang and Mr. Francis Bok each receives a salary of $2,000 per month to be paid in shares of the Company’s common
stock. Mr. Stephen Tang and Mr. Francis Bok have not been compensated as of December 31, 2016.
Directors’ compensation
The Directors have not been compensated
as of December 31, 2016.
Employment Agreement
The Company does not have employment agreements
with any of its officers or directors.
Stock option plan
We do not have a stock option plan and
we have not issued any warrants, options or other rights to acquire our securities.
Employee Pension, Profit Sharing or
other Retirement Plans
We do not have a defined benefit, pension
plan, profit sharing or other retirement plan, although we may adopt one or more of such plans in the future.
Securities authorized for issuance under
Equity Compensation Plans
None.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Security ownership of certain beneficial owners
The following table sets forth as of January
31, 2017, certain information with respect to the Company’s equity securities owned of record or beneficially by (i) each
Officer and Director of the Company; (ii) each person who owns beneficially more than five percent (5%) of each class of the Company’s
outstanding equity securities; and (iii) all Directors and Executive Officers as a group.
Title of Class
|
|
Name and Address of Beneficial Owner
(2)
|
|
Amount and Nature of
Beneficial Ownership
|
|
|
Percent of
Class
(1)
|
|
Common Stock
|
|
Stephen Tang, CEO, Pres. & Dir.
(3)
|
|
|
17,256,962
|
(4)
|
|
|
16.4%
|
|
Common Stock
|
|
Frances Bok, CFO & Dir.
(3)
|
|
|
7,968,562
|
|
|
|
7.6%
|
|
Common Stock
|
|
Fintel (USA) Ltd.
|
|
|
9,288,400
|
|
|
|
8.8%
|
|
Common Stock
|
|
Pontoon Boat Inc.
Rm 1202A, 12/F Empire Centre
68 Mody Road, Tsimshatsui, Kowloon, Hong Kong
|
|
|
53,596,540
|
|
|
|
51.0%
|
|
Common Stock
|
|
Kok Seng Yeap, CEO & Dir.
|
|
|
57,803,018
|
(5)
|
|
|
55.0%
|
|
Common Stock
|
|
He Qianying, Dir.
|
|
|
–
|
|
|
|
-%
|
|
Common Stock
|
|
All Directors and Officers as a Group (2 persons)
|
|
|
57,803,018
|
|
|
|
55.0%
|
|
(1)
|
Unless otherwise indicated, based on 105,091,254 shares of common stock issued and outstanding. Shares of common stock subject to options or warrants currently exercisable or exercisable within 60 days, are deemed outstanding for purposes of computing the percentage of the person holding such options or warrants, but are not deemed outstanding for the purposes of computing the percentage of any other person.
|
|
|
(2)
|
Unless indicated otherwise, the address of the shareholder is c/o Sancon Resources Recovery, Inc., 602 Nan Fung Tower, Suite 6/F, 88 Connaught Road central, Central District, Hong Kong.
|
|
|
(3)
|
Resigned in September 2016
|
|
|
(4)
|
Includes 7,968,562 shares of common stock over which Mr. Tang has sole investment and voting control, and 9,288,400 shares of common stock held by Fintel (USA) Ltd., which Mr. Tang may be deemed to own beneficially.
|
|
|
(5)
|
Includes 4,206,478 shares of common stock over which Mr. Kok has sole investment and voting control, and 53,596,540 shares of common stock held by Pontoon Boat Inc, which Mr. Kok may be deemed to own beneficially.
|
We are not aware of any person who owns
of record, or is known to own beneficially, five percent or more of the outstanding securities of any class of the issuer, other
than as set forth above. There are no classes of stock other than common stock issued or outstanding.
There are no current arrangements which
will result in a change in control.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS,
AND DIRECTOR INDEPENDENCE
Our directors have advanced funds on an
interest-free basis, with no maturity date, from appointment for working. Mr. Kok Seng Yeap advanced $17,400 in 2016 for cash and
professional service fees.
As of the date of this Annual Report, we
have no standing committees and our entire board of directors serves as our audit and compensation committees. We have determined
that none of our directors are independent based on an analysis of the standards for independence set forth in Section 121A of
the American Stock Exchange Company Guide. If we undertake to qualify our common stock for quotation in the over-the-counter market,
we may need to ensure we meet any eligibility requirements with respect to independent directors.
ITEM 14. PRINCIPAL ACCOUNTANT FEES
AND SERVICES
The Company’s Board of Directors
pre-approved all audit and non-audit services provided to us and during the periods listed below. The Company’s Board approves
discrete projects on a case-by-case basis that may have a material effect on our operations and also considers whether proposed
services are compatible with the independence of the public accountants.
The following table presents fees for professional
services rendered by our auditors for the periods ended December 31, 2016 and 2015:
Services Performed
|
|
2016
|
|
|
2015
|
|
Audit Fees
|
|
$
|
13,718
|
|
|
$
|
2,436
|
|
Audit-Related Fees
|
|
|
–
|
|
|
|
–
|
|
Tax Fees
|
|
|
–
|
|
|
|
–
|
|
All Other Fees
|
|
|
–
|
|
|
|
–
|
|
Total Fees
|
|
$
|
13,718
|
|
|
$
|
2,436
|
|
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
|
(a)
|
The following Exhibits are filed as part of this report.
|
Exhibit
Number
|
|
Description of Document
|
|
|
|
3.1
|
|
Articles of Incorporation of Financial Telecom Limited (USA), Inc.
|
3.2
|
|
Amended and Restated Bylaws of Financial Telecom Limited (USA), Inc.
|
10.1
|
|
Agreement between Hong Kong Futures Exchange Limited and Financial Telecom Limited
|
10.2
|
|
Market Service Datafeed Agreement between Stock Exchange Information Services Limited and Financial Telecom Limited
|
10.3
|
|
Option agreement dated December 14, 2004 between Fintel Group Limited and shareholders of Shanghai Longterms Technology Limited.
|
10.4
|
|
Option agreement dated January 5, 2005 between Fintel Group Limited and shareholders of Beijing JCL Technology Commerce Limited.
|
10.5
|
|
Option agreement dated January 20, 2005 between Fintel Group Limited and shareholders of Shanghai Qianhou Computer Technology Limited.
|
10.6
|
|
Independent contractor agreement between Fintel Group Limited and Mr. Sam Chong Keen.
|
10.7
|
|
Independent contractor agreement between Fintel Group Limited and Info Media Company.
|
10.8
|
|
Independent contractor agreement between Fintel Group Limited and China Digital Distribution Limited.
|
10.9
|
|
Sales and purchase agreement dated March 25, 2005 between Fintel Group Limited and shareholders of Enjoy Media Holdings Limited
|
10.10
|
|
Sales and purchase agreement dated April 25, 2005 between Fintel Group Limited and shareholders of Beijing Genial Technology Co. Ltd.
|
10.11
|
|
Option agreement dated March 7, 2005 between Fintel Group Limited and shareholders of Beijing Sinoskyline technology Trading Co. Ltd.
|
10.12
|
|
Settlement agreement dated December 5, 2012 between Sancon Resources Recovery, Inc. and Dragon Wings Communications Limited.
|
10.13
|
|
Notice of Dismissal dated January 11, 2013 issued by the United States Bankruptcy Court, District of Nevada.
|
10.14
|
|
Service Agreement, dated May 31, 2013, between Sancon Resources Recovery, Inc. and Fintel (USA) Ltd.
|
10.15*
|
|
Service Agreement, dated July 20, 2016, between Sancon Resources Recovery, Inc. and Fintel (USA) Ltd.
|
14.1
|
|
Code of Ethics
|
21.1
|
|
Subsidiaries of the registrant
|
31.1*
|
|
Certification of Director and Chief Executive Officer
|
31.2*
|
|
Certification of Director
|
32.1*
|
|
Statement required by 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002
|
32.2*
|
|
Statement required by 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002
|
101
|
|
The following materials from the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, formatted in XBRL (eXtensible Business Reporting Language); (i) Balance Sheets at December 31, 2016 and 2015, (ii) Statement of Operations for the years ended December 31, 2016 and 2015, (iii) Statement of Cash Flows for the years ended December 31, 2016 and 2015, and (iv) Notes to Financial Statements.
|
*
Filed
herewith.
(1)
|
Incorporated herein by reference to the registrant’s initial Registration Statement on Form 10-SB (File No. 000-50760) filed on May 13, 2004.
|
(2)
|
Incorporated herein by reference to the registrant’s Annual Report on Form 10-KSB (File No. 000-50760) filed April 15, 2005.
|
(3)
|
Incorporated herein by reference to the registrant’s Quarterly Report on Form 10-QSB (File No. 000-50760) filed May 6, 2005.
|
(4)
|
Incorporated herein by reference to the registrant’s Quarterly Report on Form 10-QSB (File No. 000-50760) filed August 6, 2005.
|
(5)
|
Incorporated herein by reference to the registrant’s Current Report on Form 8K/A (File No. 000-50760) filed November 29, 2005.
|
(6)
|
Incorporated herein by reference to the registrant’s Current Report on Form 8K/A (File No. 000-50760) filed January 25, 2006.
|
(7)
|
Incorporated herein by reference to the registrant’s Proxy Statement (File No. 000-50760) filed December 6, 2005.
|
(8)
|
Incorporated herein by reference to the registrant’s Annual Report on Form 10-KSB (File No. 000-50760) filed April 26, 2006.
|
(9)
|
Incorporated by reference to the Exhibits to our Form 10-Q filed on May 17, 2016
|
(10)
|
Incorporated by reference to the Exhibits to our Form 10-Q filed on May 23, 2016
|
INDEX TO FINANCIAL STATEMENTS
SANCON RESOURCES RECOVERY, INC.
REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
To the Board of Directors and Shareholders of
Sancon Resources Recovery, Inc. (“the Company”)
We have audited the accompanying balance
sheets of Sancon Resources Recovery, Inc. (incorporated in the State of Nevada, USA), as at December 31, 2016 and 2015, and the
related statements of income, cash flows and stockholders’ equity for the years then ended. These financial statements are
the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements
based on our audits.
We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements
referred to above present fairly, in all material respects, the financial position of Sancon Resources Recovery, Inc. as at December
31, 2016 and 2015, and the results of its operations and its cash flows for the years then ended in accordance with generally accepted
accounting principles in the United States of America.
The company is not required to have nor
were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal
control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the company’s internal controls over financial reporting. Accordingly,
we express no such opinion.
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 is currently dormant, and has the accumulated deficits as of December 31, 2016 and 2015 and no source of revenue, which
raises substantial doubt about its ability to continue as a going concern. Management's plans concerning 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.
/s/ Anthony Kam & Associates
Limited
Anthony Kam & Associates Limited
Certified Public Accountants
Hong Kong, China
March 30, 2017
SANCON RESOURCES RECOVERY, INC.
BALANCE SHEETS
AS OF DECEMBER 31, 2016 AND 2015
(United States dollars, except number of shares, per share data and unless otherwise stated)
|
|
As at
|
|
|
|
December 31, 2016
|
|
|
December 31, 2015
|
|
Assets
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
Current Assets
|
|
|
–
|
|
|
|
–
|
|
Total current assets and total assets
|
|
$
|
–
|
|
|
$
|
–
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
Due to related parties
|
|
$
|
100,137
|
|
|
$
|
163,674
|
|
Accrued expenses and other payables
|
|
|
1,973
|
|
|
|
57,244
|
|
Total current liability and total liability
|
|
$
|
102,110
|
|
|
$
|
220,918
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity
|
|
|
|
|
|
|
|
|
Share capital authorized: 500,000,000 common shares, par value $0.001 per share
|
|
|
|
|
|
|
|
|
Issued and outstanding: 105,091,254 shares as of December 31, 2016
(December 31, 2015: 32,219,996 shares)
|
|
$
|
105,091
|
|
|
$
|
32,220
|
|
Additional paid-in capital
|
|
|
923,070
|
|
|
|
792,720
|
|
Share option reserves
|
|
|
89,015
|
|
|
|
89,015
|
|
Accumulated losses
|
|
|
(1,219,286
|
)
|
|
|
(1,134,873
|
)
|
Total stockholders' deficit
|
|
|
(102,110
|
)
|
|
|
(220,918
|
)
|
Total liabilities & stockholders' equity
|
|
$
|
–
|
|
|
$
|
–
|
|
The accompanying notes are an integral part of these audited financial statements
SANCON RESOURCES RECOVERY, INC.
STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015
(United States dollars, except number of shares, per share data and unless otherwise stated)
|
|
For the years ended December 31,
|
|
|
|
2016
|
|
|
2015
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
–
|
|
|
$
|
–
|
|
|
|
|
|
|
|
|
|
|
Other operating income
|
|
|
1,230
|
|
|
|
–
|
|
General and administrative expenses
|
|
|
(85,643
|
)
|
|
|
(74,147
|
)
|
Operating loss before income taxes
|
|
|
(84,413
|
)
|
|
|
(74,147
|
)
|
|
|
|
|
|
|
|
|
|
Income taxes
|
|
|
–
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(84,413
|
)
|
|
$
|
(74,147
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per share:
|
|
|
|
|
|
|
|
|
Basic loss per share
|
|
$
|
(0.001
|
)
|
|
$
|
(0.002
|
)
|
Basic weighted average shares outstanding
|
|
|
85,566,565
|
|
|
|
32,219,996
|
|
Diluted loss per share
|
|
$
|
(0.001
|
)
|
|
$
|
(0.002
|
)
|
Diluted weighted average shares outstanding
|
|
|
85,592,300
|
|
|
|
33,145,175
|
|
The accompanying notes are an integral part of these audited financial statements
SANCON RESOURCES RECOVERY, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015
(United States dollars, except number of shares, per share data and unless otherwise stated)
|
|
Common
Shares
|
|
|
Common Stock
|
|
|
Additional
Paid in Capital
|
|
|
Share
Option Reserves
|
|
|
Accumulated losses
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of December 31, 2014
|
|
|
32,219,996
|
|
|
$
|
32,220
|
|
|
$
|
792,720
|
|
|
$
|
89,015
|
|
|
$
|
(1,060,726
|
)
|
|
$
|
(146,771
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the year
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(74,147
|
)
|
|
|
(74,147
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of December 31, 2015
|
|
|
32,219,996
|
|
|
|
32,220
|
|
|
|
792,720
|
|
|
|
89,015
|
|
|
|
(1,134,873
|
)
|
|
|
(220,918
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock
|
|
|
72,871,258
|
|
|
|
72,871
|
|
|
|
130,350
|
|
|
|
–
|
|
|
|
–
|
|
|
|
203,221
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the year
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(84,413
|
)
|
|
|
(84,413
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of December 31, 2016
|
|
|
105,091,254
|
|
|
$
|
105,091
|
|
|
$
|
923,070
|
|
|
$
|
89,015
|
|
|
$
|
(1,219,286
|
)
|
|
$
|
(102,110
|
)
|
The accompanying notes are an integral part
of these audited financial statements
SANCON RESOURCES RECOVERY, INC.
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015
(United States dollars, except number of shares, per share data and unless otherwise stated)
|
|
For the years ended December 31,
|
|
|
|
2016
|
|
|
2015
|
|
|
|
|
|
Cash Flows from Operating Activities
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(84,413
|
)
|
|
$
|
(74,147
|
)
|
Adjustments to reconcile net income to net cash flows provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share based payment
|
|
|
–
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
Changes in current assets and liabilities, net of business acquisition:
|
|
|
|
|
|
|
|
|
(Increase)/Decrease in other current assets
|
|
|
–
|
|
|
|
–
|
|
(Decrease)/Increase in accrued expenses and other payables
|
|
|
(55,271
|
)
|
|
|
23,370
|
|
Net cash flows used in Operating Activities
|
|
|
(139,684
|
)
|
|
|
(50,777
|
)
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing Activities
|
|
|
|
|
|
|
|
|
Purchase of property and equipment
|
|
|
–
|
|
|
|
–
|
|
Net cash flows used in Investing Activities
|
|
|
–
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Financing Activities
|
|
|
|
|
|
|
|
|
Issuance of shares
|
|
|
203,221
|
|
|
|
–
|
|
Loans from related parties
|
|
|
–
|
|
|
|
50,777
|
|
Settlement of loans from related parties
|
|
|
(63,537
|
)
|
|
|
–
|
|
Net cash flows provided by Financing Activities
|
|
|
139,684
|
|
|
|
50,777
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash
|
|
|
–
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
Net increase in cash & cash equivalents
|
|
|
–
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
Cash & cash equivalent at start of year
|
|
|
–
|
|
|
|
–
|
|
Cash & cash equivalent at end of year
|
|
$
|
–
|
|
|
$
|
–
|
|
The accompanying notes are an integral part of these audited financial statements
SANCON RESOURCES RECOVERY, INC.
NOTES TO FINANCIAL STATEMENTS
(United States dollars, except number
of shares, per share data and unless otherwise stated)
NOTE 1. ORGANIZATION AND
NATURE OF OPERATIONS
Sancon Resources Recovery, Inc. ("Sancon",
or "the Company", or "we", or "us") is registered in Nevada. Sancon Resources Recovery, Inc. is an
environmental service and waste management company that operates recycling facilities in China and Australia. Sancon specializes
in the collection and recovery of industrial and commercial solid wastes such as plastic, paper, cardboard, and glass.
On April 1, 2011, the Company approved
an infusion of equity into Sancon Resources Recovery (Shanghai) Co., Ltd. (“Sancon SH”) for a total of $2,000,000,
of which Sancon invested $1,400,000 to Sancon SH and the minority shareholder invested $600,000.
On September 15, 2011, one of the subsidiaries,
Sancon Recycling Pty. Limited, applied for liquidation.
On October 31, 2011, the Company disposed
of its subsidiaries Crossover Solution Inc. (“CS”) and Sancon SH at a consideration of $404,000.
After disposal of all its subsidiaries
in the 4
th
quarter of 2011, the company currently does not have any business operation.
NOTE 2. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
Use of Estimates
These financial statements are prepared
in accordance with accounting principles accepted generally in the USA. These principles require management to use its best judgment
in determining estimates and assumptions that: affect the reported amounts of assets and liabilities; 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. Management makes its best estimate of the ultimate outcome for such items based on historical trends and other information
available when the financial statements are prepared. Changes in estimates are recognized in accordance with the relevant accounting
rules, typically in the period when new information becomes available to management. Actual results in the future could differ
from the estimates made in the prior and current periods.
Cash And Cash Equivalents
Cash and cash equivalents include cash
in hand and cash in bank accounts mainly used for the business operations with maturities of less than 90 days.
Revenue Recognition
The Company’s revenue recognition policies are in compliance
with Staff accounting bulletin (SAB) 104(ASC 605). Sales revenue is recognized when the significant risks and rewards of the ownership
of goods have been transferred to the buyers. No revenue is recognized if there are significant uncertainties regarding
the recovery of the consideration due, the possible return of goods, or when the amount of revenue and the costs incurred or to
be incurred in respect of the transaction cannot be measured reliably.
Earnings Per Share
Basic earnings per share ("EPS")
is calculated using net earnings (the numerator) divided by the weighted-average number of shares outstanding (the denominator)
during the reporting period. Diluted EPS includes the effect from potentially dilutive securities.
Income Taxes
The Company recognizes deferred tax assets
and liabilities for the expected future tax consequences of events that have been included in the financial statement or tax returns.
Under this method, deferred tax assets and liabilities are determined based on the difference between financial statements and
tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.
SANCON RESOURCES RECOVERY, INC.
NOTES TO FINANCIAL STATEMENTS
(United States dollars, except number
of shares, per share data and unless otherwise stated)
NOTE 2. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (CONTINUED)
The Company operates in several countries.
As a result, we are subject to numerous domestic and foreign tax jurisdictions and tax agreements and treaties among the various
taxing authorities. Our operations in these jurisdictions are taxed on various bases: income before taxes, deemed profits and withholding
taxes based on revenue. The calculation of our tax liabilities involves consideration of uncertainties in the application and interpretation
of complex tax regulations in a multitude of jurisdictions across our global operations.
We regularly assess our position with regard
to individual tax exposures and record liabilities for our uncertain tax positions and related interest and penalties. These accruals
reflect management's view of the likely outcomes of current and future audits. The future resolution of these uncertain tax positions
may be different from the amounts currently accrued and therefore could impact future tax period expense.
Changes in tax laws, regulations, agreements
and treaties, foreign currency exchange restrictions or our level of operations or profitability in each taxing jurisdiction could
have an impact upon the amount of income taxes that we provide during any given year.
Stock Based Compensation
As of December 31, 2016 and 2015, the Company
did not issue any stock options.
Recent pronouncements
The Company has considered all new accounting
pronouncements and has concluded that there are no new pronouncements that may have a material impact on results of operations,
financial condition, or cash flows, based on current information.
NOTE 3. GOING CONCERN
The accompanying financial statements have
been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation
of the Company as a going concern. However, after the disposal of its operating subsidiaries in the 4
th
quarter of 2011
and became dormant afterwards, the Company has the stockholders’ deficits of $102,110 and $220,918 as of December 31, 2016
and December 31, 2015 respectively. These factors raise substantial doubt about the ability of the Company to continue as a going
concern. In this regard, management is proposing to raise any necessary additional funds not provided by operations through loans,
additional sales of its common stock or through a possible business combination. There is no assurance that the Company will be
successful in raising this additional capital or in achieving profitable operations. The financial statements do not include any
adjustments that might result from the outcome of these uncertainties.
NOTE 4. RELATED PARTY TRANSACTIONS
As of December 31, 2016, the Company owed
$17,400 and $82,737 to director and shareholder respectively.
As of December 31, 2015, the Company owed
$141,931, $1,230 and $20,513 to directors, shareholder and related companies respectively.
On May 4, 2016, (i) 42,582,858 shares of our common stock, valued
at $138,000 were issued in lieu of cash compensation for director and secretarial services from March 13, 2014 through June 30,
2016; and (ii) 9,288,400 shares of our common stock, valued at $23,221 were issued in lieu of cash compensation for accounting
services from December 22, 2013 through June 30, 2016.
NOTE 5. STOCKHOLDERS’ EQUITY
Common stock
Please refer to Note 4 – Related Party Transactions for
the details of changes in share capital for the year ended December 31, 2016.
SANCON RESOURCES RECOVERY, INC.
NOTES TO FINANCIAL STATEMENTS
(United States dollars, except number
of shares, per share data and unless otherwise stated)
NOTE
5. STOCKHOLDERS’ EQUITY (CONTINUED)
Stock options
On December 5, 2012, the Company entered
into a settlement agreement with Dragon Wings for the settlement of the claim by Dragon Wings. In consideration of Sancon's agreement
to make the payments in the form of common shares and share options listed in the settlement agreement. The Company would give
the option to Dragon Wings to purchase 6,000,000 common shares; the option may be exercised by Dragon Wings in whole or in part,
at any time within 5 years from the date of this settlement agreement with the exercise price at US$0.01 per share, with dilution
protection and subject to share split adjustment.
|
|
As at
|
|
|
|
December 31,
2016
|
|
|
December 31,
2015
|
|
|
|
|
|
|
|
|
Loan settled by share option
|
|
$
|
149,015
|
|
|
$
|
149,015
|
|
Par value of the common shares
|
|
|
60,000
|
|
|
|
60,000
|
|
Fair value of share option
|
|
$
|
89,015
|
|
|
$
|
89,015
|
|
NOTE 6. INCOME TAXES
The Company is registered in the State
of Nevada. Before the disposal of its operating subsidiaries on October 31, 2011, the Company had operations in primarily four
tax jurisdictions the Australia, China, British Virgin Islands and the United States. For certain operations in the United States
of America, the Company has incurred net accumulated operating losses for income tax purposes. The Company believes that it is
more likely than not that these net accumulated operating losses will not be utilized in the future. Therefore, the Company has
provided full valuation allowance for the deferred tax assets arising from the losses from its US public shell as of December 31,
2016 and December 31, 2015.
The components of income before income
taxes and non-controlling interest are as follows:
|
|
As at
|
|
|
|
December 31,
2016
|
|
|
December 31,
2015
|
|
|
|
|
|
|
|
|
Loss subject to United States
|
|
$
|
(84,413
|
)
|
|
$
|
(74,147
|
)
|
Net loss before income tax and non-controlling interest
|
|
$
|
(84,413
|
)
|
|
$
|
(74,147
|
)
|
United States of America
As of December 31, 2016, the Company in
the United States of America had approximately $8,084,031 in net operating loss carry forwards available to offset future taxable
income. Federal net operating losses can generally be carried forward 20 years. The Tax Reform Act of 1986 limits the use of net
operating loss and tax credit carry forwards in certain situations when changes occur in the stock ownership of a company. In the
event the Company has a change in ownership, utilization of carry forwards could be restricted. The deferred tax assets for the
United States entity at December 31, 2016 consists mainly of net operating loss carry forwards and were fully reserved as the management
believes it is more likely than not that these assets will not be realized in the future.
The following table sets forth the significant
components of the net deferred tax assets for operation in the United States of America as of December 31, 2016 and 2015.
|
|
As at
|
|
|
|
December 31,
2016
|
|
|
December 31,
2015
|
|
Net Operating Loss Carry Forwards
|
|
$
|
8,084,031
|
|
|
$
|
7,999,618
|
|
|
|
|
|
|
|
|
|
|
Total Deferred Tax Assets
|
|
|
2,748,570
|
|
|
|
2,719,870
|
|
Less: Valuation Allowance
|
|
|
(2,748,570
|
)
|
|
|
(2,719,870
|
)
|
Net Deferred Tax Assets
|
|
$
|
–
|
|
|
$
|
–
|
|
As of December 31, 2016, the Company does not have any unrecognized
tax benefits and no corresponding interest or penalties. The Company's policy is to record interest and penalties as income tax
expense.
SIGNATURES
Pursuant to the requirements of the Section
13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized on the March 31, 2017.
SANCON RESOURCES RECOVERY,
INC.
By:
/s/ Kok Seng Yeap
Kok Seng Yeap
Director
(Chief Executive Officer)
In accordance with the Securities Exchange
Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on
the dates indicated.
Name
|
Title
|
Date
|
|
|
|
/s/
Kok Seng Yeap
Kok
Seng Yeap
|
Director
(Chief Executive Officer)
|
March
31, 2017
|
|
|
|
|
|
|
/s/
He Qianying
He
Qianying
|
Director
|
March
31, 2017
|
INDEX TO
EXHIBITS
Exhibit No.
|
|
Description
|
|
3.1
|
|
Articles of Incorporation of Financial Telecom Limited (USA), Inc.
|
|
3.2
|
|
Amended and Restated Bylaws of Financial Telecom Limited (USA), Inc.
|
|
10.1
|
|
Agreement between Hong Kong Futures Exchange Limited and Financial Telecom Limited
|
|
10.2
|
|
Market Service Datafeed Agreement between Stock Exchange Information Services Limited and Financial Telecom Limited
|
|
10.3
|
|
Option agreement dated December 14, 2004 between Fintel Group Limited and shareholders of Shanghai Longterms Technology Limited.
|
|
10.4
|
|
Option agreement dated January 5, 2005 between Fintel Group Limited and shareholders of Beijing JCL Technology Commerce Limited.
|
|
10.5
|
|
Option agreement dated January 20, 2005 between Fintel Group Limited and shareholders of Shanghai Qianhou Computer Technology Limited.
|
|
10.6
|
|
Independent contractor agreement between Fintel Group Limited and Mr. Sam Chong Keen.
|
|
10.7
|
|
Independent contractor agreement between Fintel Group Limited and Info Media Company.
|
|
10.8
|
|
Independent contractor agreement between Fintel Group Limited and China Digital Distribution Limited.
|
|
10.9
|
|
Sales and purchase agreement dated March 25, 2005 between Fintel Group Limited and shareholders of Enjoy Media Holdings Limited
|
|
10.10
|
|
Sales and purchase agreement dated April 25, 2005 between Fintel Group Limited and shareholders of Beijing Genial Technology Co. Ltd.
|
|
10.11
|
|
Option agreement dated March 7, 2005 between Fintel Group Limited and shareholders of Beijing Sinoskyline technology Trading Co. Ltd.
|
|
10.12
|
|
Settlement agreement dated December 5, 2012 between Sancon Resources Recovery, Inc. and Dragon Wings Communications Limited.
|
|
10.13
|
|
Notice of Dismissal dated January 11, 2013 issued by the United States Bankruptcy Court, District of Nevada.
|
|
10.14
|
|
Service Agreement, dated May 31, 2013, between Sancon Resources Recovery, Inc. and Fintel (USA) Ltd.
|
|
10.15*
|
|
Service Agreement, dated July 20, 2016, between Sancon Resources Recovery, Inc. and Fintel (USA) Ltd.
|
|
14.1
|
|
Code of Ethics
|
|
21.1
|
|
Subsidiaries of the registrant
|
|
31.1*
|
|
Certification of Director and Chief Executive Officer
|
|
31.2*
|
|
Certification of Director
|
|
32.1*
|
|
Statement required by 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002
|
|
32.2*
|
|
Statement required by 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002
|
|
101
|
|
The following materials from the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, formatted in XBRL (eXtensible Business Reporting Language); (i) Balance Sheets at December 31, 2016 and 2015, (ii) Statement of Operations for the years ended December 31, 2016 and 2015, (iii) Statement of Cash Flows for the years ended December 31, 2016 and 2015, and (iv) Notes to Financial Statements.
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*Filed
herewith
(1)
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Incorporated herein by reference to the registrant’s initial Registration Statement on Form 10-SB (File No. 000-50760) filed on May 13, 2004.
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(2)
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Incorporated herein by reference to the registrant’s Annual Report on Form 10-KSB (File No. 000-50760) filed April 15, 2005.
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(3)
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Incorporated herein by reference to the registrant’s Quarterly Report on Form 10-QSB (File No. 000-50760) filed May 6, 2005.
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(4)
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Incorporated herein by reference to the registrant’s Quarterly Report on Form 10-QSB (File No. 000-50760) filed August 6, 2005.
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(5)
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Incorporated herein by reference to the registrant’s Current Report on Form 8K/A (File No. 000-50760) filed November 29, 2005.
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(6)
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Incorporated herein by reference to the registrant’s Current Report on Form 8K/A (File No. 000-50760) filed January 25, 2006.
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(7)
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Incorporated herein by reference to the registrant’s Proxy Statement (File No. 000-50760) filed December 6, 2005.
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(8)
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Incorporated herein by reference to the registrant’s Annual Report on Form 10-KSB (File No. 000-50760) filed April 26, 2006.
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(9)
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Incorporated by reference to the Exhibits to our Form 10-Q filed on May 17, 2016
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(10)
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Incorporated by reference to the Exhibits to our Form 10-Q filed on May 23, 2016
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