UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

(Mark One)

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

 

 

For the quarterly period ended May 31, 2021

 

or

 

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

 

 

For the transition period from ____________ to ____________

 

Commission File Number 333-214638

 

NANOVATION MICROTECH, INC.

(Exact name of registrant as specified in its charter)

 

Nevada

 

37-1832675

(State or other jurisdiction of

incorporation or organization)

 

(IRS Employer

Identification No.)

 

Osterbrogade 226 st. tv, Copenhagen, Denmark

 

2100

(Address of principal executive offices)

 

(Zip Code)

 

302-782-4171

(Registrant’s telephone number, including area code)

 

N/A

(Former name, former address and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

None

 

None

 

None

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ YES     ☐ NO

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ YES     ☐ NO

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) ☐ YES     ☒ NO

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS

 

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. ☐ YES     ☐ NO

 

APPLICABLE ONLY TO CORPORATE ISSUERS

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

80,616 common shares issued and outstanding as of July 2, 2021.

 

 

 

  

TABLE OF CONTENTS

 

PART I - FINANCIAL INFORMATION

 

 

 

 

 

 

 

 

Item 1.

Financial Statements

 

3

 

 

 

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

11

 

 

 

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

15

 

 

 

 

 

 

Item 4.

Controls and Procedures

 

15

 

 

 

 

 

 

PART II - OTHER INFORMATION

 

 

 

 

 

 

 

 

Item 1.

Legal Proceedings

 

16

 

 

 

 

 

 

Item 1A.

Risk Factors

 

16

 

 

 

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

 

16

 

 

 

 

 

 

Item 3.

Defaults Upon Senior Securities

 

16

 

 

 

 

 

 

Item 4.

Mine Safety Disclosures

 

16

 

 

 

 

 

 

Item 5.

Other Information

 

16

 

 

 

 

 

 

Item 6.

Exhibits

 

17

 

 

 

 

 

 

SIGNATURES

 

18

 

 

 
2

Table of Contents

 

PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

NANOVATION MICROTECH, INC.

Consolidated Balance Sheets

As of May 31, 2021 and August 31, 2020

(Unaudited)

 

 

 

May 31,

 

 

August 31,

 

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Total Current Assets

 

$ -

 

 

$ -

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$ -

 

 

$ -

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$ 13,800

 

 

$ 12,100

 

Accrued Interest

 

 

29,742

 

 

 

13,413

 

Convertible notes

 

 

88,660

 

 

 

80,086

 

Due to related party

 

 

18,884

 

 

 

-

 

TOTAL LIABILITIES

 

 

151,086

 

 

 

105,599

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS’ DEFICIT

 

 

 

 

 

 

 

 

Common stock, par value $0.001 per share, 75,000,000 shares authorized, 80,616 shares issued and outstanding

 

 

81

 

 

 

81

 

Additional paid-in capital

 

 

119,516

 

 

 

110,942

 

Retained earnings from discontinued operations

 

 

29,190

 

 

 

29,190

 

Accumulated deficit

 

 

(299,873 )

 

 

(245,812 )

Total Stockholders’ Deficit

 

 

(151,086 )

 

 

(105,599 )

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

$ -

 

 

$ -

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

 
3

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NANOVATION MICROTECH, INC.

Consolidated Statements of Operations

For the nine months and three months ended May 31, 2021 and May 31, 2020

(Unaudited)

 

 

 

For the Three Months Ended

 

 

For the Nine Months Ended

 

 

 

May 31,

 

 

May 31,

 

 

May 31,

 

 

May 31,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REVENUES, NET OF FEES

 

$ -

 

 

$ -

 

 

$ -

 

 

$ 794

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

$ 7,730

 

 

$ 7,492

 

 

$ 29,158

 

 

$ 30,665

 

Total Operating Expenses

 

 

7,730

 

 

 

7,492

 

 

 

29,158

 

 

 

30,665

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

5,664

 

 

 

8,626

 

 

 

24,903

 

 

 

81,788

 

 

 

 

5,664

 

 

 

8,626

 

 

 

24,903

 

 

 

81,788

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss Before Income Taxes

 

 

(13,394 )

 

 

(16,118 )

 

 

(54,061 )

 

 

(111,659 )

Provision for Income Taxes

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

NET LOSS

 

$ (13,394 )

 

$ (16,118 )

 

$ (54,061 )

 

$ (111,659 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share: Basic and Diluted

 

$ (0.17 )

 

$ (0.20 )

 

$ (0.67 )

 

 

(1.39 )

Weighted Average Common Shares Outstanding - Basic and Diluted

 

 

80,616

 

 

 

80,616

 

 

 

80,616

 

 

 

80,616

 

 

The accompanying notes are an integral part of these unaudited financial statements

 

 
4

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NANOVATION MICROTECH, INC.

Consolidated Statements of Stockholders’ Equity (Deficit)

For the nine months and three months ended May 31, 2021 and May 31, 2020

(Unaudited)

 

 

 

Common Stock

 

 

Additional

 

 

Retained Earnings

from

 

 

 

 

Total

 

 

 

Number of Shares

 

 

Amount

 

 

Paid-in

Capital

 

 

Discontinued

Operations

 

 

Accumulated

Deficit

 

 

Stockholders’

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - August 31, 2020

 

 

80,616

 

 

$ 81

 

 

$ 110,942

 

 

$ 29,190

 

 

$ (245,812 )

 

$ (105,599 )

Note Beneficial Conversion Feature

 

 

-

 

 

 

-

 

 

 

8,574

 

 

 

-

 

 

 

-

 

 

 

8,574

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(30,890 )

 

 

(30,890 )

Balance - November 30, 2020

 

 

80,616

 

 

$ 81

 

 

$ 119,516

 

 

$ 29,190

 

 

$ (276,702 )

 

$ (127,915 )

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(9,777 )

 

 

(9,777 )

Balance - February 28, 2021

 

 

80,616

 

 

$ 81

 

 

$ 119,516

 

 

$ 29,190

 

 

$ (286,479 )

 

$ (137,692 )

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(13,394 )

 

 

(13,394 )

Balance - May 31, 2021

 

 

80,616

 

 

$ 81

 

 

$ 119,516

 

 

$ 29,190

 

 

$ (299,873 )

 

$ (151,086 )

 

 

 

Common Stock

 

 

Additional

 

 

Retained Earnings

from

 

 

 

 

Total

 

 

 

Number of Shares

 

 

Amount

 

 

Paid-in

Capital

 

 

Discontinued

Operations

 

 

Accumulated

Deficit

 

 

Stockholders’

Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

*Balance - August 31, 2019

 

 

80,616

 

 

$ 81

 

 

$ 30,856

 

 

$ 29,190

 

 

$ (112,691 )

 

$ (52,564 )

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(15,856 )

 

 

(15,856 )

Balance - November 30, 2019

 

 

80,616

 

 

$ 81

 

 

$ 30,856

 

 

$ 29,190

 

 

$ (128,547 )

 

$ (68,420 )

Note Beneficial Conversion Feature

 

 

-

 

 

 

-

 

 

 

68,813

 

 

 

-

 

 

 

-

 

 

 

68,813

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(79,685 )

 

 

(79,685 )

Balance - February 29, 2020

 

 

80,616

 

 

$ 81

 

 

$ 99,669

 

 

$ 29,190

 

 

$ (208,232 )

 

$ (79,292 )

Note Beneficial Conversion Feature

 

 

-

 

 

 

-

 

 

 

4,230

 

 

 

-

 

 

 

-

 

 

 

4,230

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(16,118 )

 

 

(16,118 )

Balance - May 31, 2020

 

 

80,616

 

 

$ 81

 

 

$ 103,899

 

 

$ 29,190

 

 

$ (224,350 )

 

$ (91,180 )

 

* retroactively reflect 60:1 reverse stock split

 

The accompanying notes are an integral part of these unaudited financial statements

 

 
5

Table of Contents

  

NANOVATION MICROTECH, INC.

Consolidated Statements of Cash Flows

For the nine months ended May 31 2021 and May 31, 2020

(Unaudited)

 

 

 

For the Nine Months Ended

 

 

 

May 31,

 

 

May 31,

 

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

Net loss

 

$ (54,061 )

 

$ (111,659 )

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Note Discount Amortization

 

 

8,574

 

 

 

73,043

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

-

 

 

 

149

 

Accounts payable and accrued liabilities

 

 

1,701

 

 

 

3,861

 

Accrued interest

 

 

16,328

 

 

 

8,745

 

Net cash used in operating activities

 

 

(27,458 )

 

 

(25,861 )

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

Advancement from director

 

 

18,884

 

 

 

-

 

Proceeds from issuance of convertible note

 

 

8,574

 

 

 

26,803

 

Net cash provided by financing activities

 

 

27,458

 

 

 

26,803

 

 

 

 

 

 

 

 

 

 

Net changes in cash and cash equivalents

 

 

-

 

 

 

942

 

Cash and cash equivalents - beginning of period

 

 

-

 

 

 

1,848

 

Cash and cash equivalents - end of period

 

$ -

 

 

$ 2,790

 

 

 

 

 

 

 

 

 

 

Supplemental Cash Flow Disclosures

 

 

 

 

 

 

 

 

Cash paid for interest

 

$ -

 

 

$ -

 

Cash paid for income taxes

 

$ -

 

 

$ -

 

 

 

 

 

 

 

 

 

 

Non-Cash Investing and Financing Activity:

 

 

 

 

 

 

 

 

Note Beneficial Conversion Feature

 

$ 8,574

 

 

$ 73,043

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

 
6

Table of Contents

  

NANOVATION MICROTECH, INC.

Notes to the Unaudited Consolidated Financial Statements

May 31, 2021

 

NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS

 

Nanovation Microtech, Inc. (“the Company”) was incorporated on July 20, 2016 in the State of Nevada.

 

On May 4, 2018, as a result of a private transaction, the control block of voting stock of the Company, represented by 4,000,000 shares of common stock, was transferred from Jose Maria Galarza Gaona to Greenfields International Limited, and a change of control of Kalmin Corp. has occurred.

 

Upon the change of control of the Company, the existing directors and officers resigned immediately. Accordingly, Jose Maria Galarza Gaona, serving as director and President and Karel Astride Oulai, serving as Treasurer and Secretary, ceased to be the Company’s officers and directors. At the effective date of the transfer, Xie Qi Kang, age 36, assumed the role of director and Chief Executive Officer, President, Secretary and Treasurer of the Company.

 

Previous Business

 

From inception until May 4, 2018, the Company manufactured and sold the necessary equipment for drinking mate – kalabas and bombilla. With the change of control on May 4, 2018, management determined it was in the best interest of the Company to seek new business opportunities.

 

Acquisition

 

On December 1, 2018, the Company entered into a Share Sale and Purchase Agreement (the “Agreement”) with No Tie LLC (“No Tie”). Under the terms of the Agreement, the Company have agreed to purchase all of the issued and outstanding shares of No Tie and its mobile application assets for a purchase price of $37,500 (the “Acquisition”).

 

In connection with the Agreement, the Company assumed certain ongoing responsibilities of No Tie, including maintaining Apple developer licenses and domain name registration and hosting.

 

The Acquisition closed on January 25, 2019. At closing, No Tie became a subsidiary of our company.

 

On June 15, 2020, the Company approved the name change and a 60:1 reverse stock split which was approved by FINRA and effective July 15, 2020.

 

Current Business

 

Upon closing of the Acquisition, the Company is now an App business with 120+ Apps primarily for iPhone, iPad and Apple.

 

NOTE 2 – GOING CONCERN

 

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”), which contemplate continuation of the Company as a going concern. The Company incurred an operating loss of $54,061 during the nine months ended May 31, 2021 and has accumulated deficit of $299,873 from continued operations and retained earnings of $29,190 from discontinued operations as of May 31, 2021. The Company has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time. Therefore, there is substantial doubt about the Company’s ability to continue as a going concern. Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses. The Company intends to position itself so that it will be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors to become financially viable and continue as a going concern. These financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

 
7

Table of Contents

 

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of presentation

 

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with GAAP for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the nine months ended May 31, 2021 are not necessarily indicative of the results that may be expected for the year ending August 31, 2021. Notes to the unaudited interim financial statements that would substantially duplicate the disclosures contained in the audited financial statements for fiscal year 2020 have been omitted. These interim financial statements are condensed and should be read in conjunction with the audited financial statements and the footnotes thereto for the fiscal year ended August 31, 2020 included in the Company’s Form 10-K as filed with the Securities and Exchange Commission on December 10, 2020.

 

Principles of Consolidation

 

The accompanying consolidated financial statements include all of the accounts of the Company and its wholly owned subsidiary, No Tie, LLC. All significant intercompany accounts and transactions have been eliminated.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents.

 

Use of Estimates

 

The preparation of financial statements in conformity with GAAP 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 amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Revenue Recognition

 

The Company recognizes revenue from the sale of products and services in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, using the following five-step procedure:

 

Step 1: Identify the contract(s) with customers

Step 2: Identify the performance obligations in the contract

Step 3: Determine the transaction price

Step 4: Allocate the transaction price to performance obligations

Step 5: Recognize revenue when the entity satisfies a performance obligation

 

The Company’s sales are completed through an online platforms by third parties. The Company receives collection on payments either at the time of sale, or 30 or 60 days subsequent to the sale.

 

For products and services where collection is immediate, the Company recognizes revenue at the time of sale.

 

Accounts Receivable

 

The Company records accounts receivable in accordance with ASC 310, “Receivables.” Receivables consist of mobile application sales that have been made, but cash has not yet been received. The terms of receivables are typically 60 days after sale.

 

 
8

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Basic and Diluted Net Loss Per Share

 

Net loss per share is calculated in accordance with Codification topic 260, “Earnings Per Share” for the periods presented. Basic net loss per share is computed using the weighted average number of common shares outstanding. Diluted loss per share has not been presented because there are no dilutive items. Diluted net loss per share is based on the assumption that all dilutive stock options, warrants, and convertible debt are converted or exercised by applying the treasury stock method. Under this method, options and warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Options, warrants and/or convertible debt will have a dilutive effect, during periods of net profit, only when the average market price of the common stock during the period exceeds the exercise or conversion price of the items. The Company has not issued any options or warrants or similar securities since inception.

 

For the nine months ended May 31, 2021 and May 31, 2020, respectively, the following convertible notes were excluded from the computation of diluted net loss per shares as the result of the computation was anti-dilutive:

 

 

 

May 31,

 

 

May 31,

 

 

 

2021

 

 

2020

 

 

 

(Shares)

 

 

(Shares)

 

Convertible notes payable

 

 

88,659,730

 

 

 

73,043,000

 

 

Recent Accounting Pronouncements

 

In August 2020, the FASB issued ASU 2020-06, ASC Subtopic 470-20 “Debt—Debt with Conversion and Other Options”. The standard reduced the number of accounting models for convertible debt instruments and convertible preferred stock. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting; and, (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. The amendments in this update are effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company is currently assessing the impact of the adoption of this standard on its financial statements.

 

NOTE 4 – CONVERTIBLE NOTES

 

 

 

May 31,

 

 

August 31,

 

 

 

2021

 

 

2020

 

Convertible Notes - December 2019

 

$ 68,813

 

 

$ 68,813

 

Convertible Notes - May 2020

 

 

4,230

 

 

 

4,230

 

Convertible Notes - August 2020

 

 

7,043

 

 

 

7,043

 

Convertible Notes - November 2020

 

 

8,574

 

 

 

-

 

 

 

 

88,660

 

 

 

80,086

 

less: current convertible note payable

 

 

(88,660 )

 

 

(80,086 )

Long-term convertible notes payable

 

$ -

 

 

$ -

 

 

On December 1, 2019, the Company issued a convertible note to an un-affiliated party of $68,813 to replace the full amount of related party advances that had been provided to the Company. The convertible notes are due on demand, bear interest at 25% per annum and are convertible at $0.001 per share for the Company common stock. The discount on convertible notes from beneficial conversion feature of $68,813 was fully amortized during the nine ended May 31, 2020.

 

 
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On May 31, 2020, the Company issued a convertible note to an un-affiliated party of $4,230 for paying operating expenses on behalf of the Company. The convertible notes are due on demand, bear interest at 25% per annum and are convertible at $0.001 per share for the Company common stock. The discount on convertible notes from beneficial conversion feature of $4,230 was fully amortized during the year ended August 31, 2020.

 

On August 31, 2020, the Company issued a convertible note to an un-affiliated party of $7,043 for paying operating expenses on behalf of the Company. The convertible notes are due on demand, bear interest at 25% per annum and are convertible at $0.001 per share for the Company common stock. The discount on convertible notes from beneficial conversion feature of $7,043 was fully amortized during the year ended August 31, 2020.

 

On November 30, 2020, the Company issued a convertible note to an un-affiliated party of $8,574 for paying operating expenses on behalf of the Company. The convertible notes are due on demand, bear interest at 25% per annum and are convertible at $0.001 per share for the Company common stock. The discount on convertible notes from beneficial conversion feature of $8,574 was fully amortized during the six months ended February 28, 2021.

 

As of May 31, 2021 and August 31, 2020, the Company owed convertible note payable of $88,660 and $80,086, and accrued interest of $29,742 and $13,413, respectively. During the nine months ended May 31, 2021 and May 31, 2020, the Company incurred interest expense of $16,328 and $8,745, and amortization of note discount of $8,574 and $73,043, respectively.

 

NOTE 4- RELATED PARTY TRANSACTIONS

 

The amount due to related party consists of advances from the Company’s director. The amounts are non-interest bearing, have no set repayment terms and are not secured.

 

During the nine months ended May 31, 2021 and May 31, 2020, the Director of the Company advanced $13,884 and $0 to the Company for operation expenses, respectively.

 

As of May 31, 2021 and August 31, 2020, amount due to the related party was $18,884 and $0, respectively.

 

NOTE 5 – COMMON STOCK

 

The Company has authorized seventy-five million (75,000,000) shares of common stock with a par value of $0.001.

 

On June 15, 2020, a majority of our stockholders and our board of directors approved a reverse stock split of our issued and outstanding shares of common stock on a sixty (60) old for one (1) new basis. The reverse stock split became effective on July 15, 2020. The reverse stock split has been retrospectively reflected in the financial statements for the year ended August 31, 2020.

 

As of May 31, 2021 and August 31, 2020, 80,616 shares of common stock were issued and outstanding.

 

NOTE 6 – RISKS AND UNCERTAINTIES

 

In early 2020, the World Health Organization declared the rapidly spreading coronavirus disease (COVID-19) outbreak a pandemic. This pandemic has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. The Company considered the impact of COVID-19 on the assumptions and estimates used and determined that there were no material adverse impacts on the Company’s results of operations and financial position at May 31, 2021. The full extent of the future impacts of COVID-19 on the Company’s operations is uncertain. A prolonged outbreak could have a material adverse impact on financial results and business operations of the Company in the future. The Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of the date of issuance of this financial statements. These estimates may change, as new events occur and additional information is obtained.

 

NOTE 7 – SUBSEQUENT EVENTS

 

Management has evaluated subsequent events through the date these financial statements were available to be issued. Based on our evaluation no material events have occurred that require disclosure.

 

 
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

FORWARD-LOOKING STATEMENTS

 

This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

 

Our unaudited financial statements are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.

 

In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” refer to the common shares in our capital stock.

 

As used in this quarterly report, the terms “we”, “us”, “our” and “our company” mean Nanovation Microtech, Inc. and our wholly-owned subsidiary, No Tie LLC, a New York limited liability corporation, unless otherwise indicated.

 

General Overview

 

We were incorporated under the laws of the State of Nevada on July 20, 2017, for the purpose of manufacturing and selling the necessary equipment for drinking mate - kalabas and bombilla.

 

On May 4, 2018, as a result of a private transaction, the control block of voting stock of our company, represented by 4,000,000 shares of common stock, was transferred from Jose Maria Galarza Gaona to Greenfields International Limited, resulting in a change of control.

 

Upon the change of control of our company, the existing directors and officers resigned immediately. Accordingly, Jose Maria Galarza Gaona, serving as director and President and Karel Astride Oulai, serving as Treasurer and Secretary, ceased to be officers and directors of our company. At the effective date of the transfer, Teddy Chen An, assumed the role of director and Chief Executive Officer, President, Secretary and Treasurer of our company.

 

With the change of control on May 4, 2018, management determined it was in the best interest of our company to seek new business opportunities.

 

On December 1, 2018, we entered into a Share Sale and Purchase Agreement (the “Agreement”) with No Tie LLC (“No Tie”). Under the terms of the Agreement, we have agreed to purchase all of the issued and outstanding shares of No Tie and its mobile application assets for a purchase price of $37,500 (the “Acquisition”). In connection with the Agreement, our company assumed certain ongoing responsibilities of No Tie, including maintaining Apple developer licenses and domain name registration and hosting.

 

 
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The assets acquired by our company consist of a significant portion of the assets used in the operation of the No Tie business, with the exception of, accounts receivable for sales made prior to the closing date for the developer accounts, cash on hand and all computers, printers and related accessories and technology equipment.

 

On December 2, 2018, we entered into a First Amendment to the Agreement, wherein the closing date of the Acquisition was extended from December 1, 2018 to on or before January 31, 2019. The Acquisition closed on January 25, 2019. At closing, No Tie became a subsidiary of our company.

 

Our principal executive offices are located at Osterbrogade 226 st. tv, Copenhagen, Denmark 2100. Our telephone number is (302)782-4171. We do not have a corporate website.

 

Other than as set out herein, we have not been involved in any bankruptcy, receivership or similar proceedings, nor have we been a party to any material reclassification, merger, consolidation or purchase or sale of a significant amount of assets not in the ordinary course of our business.

 

Our Current Business

 

Upon closing of the Acquisition, we are now an App business with 120+ Apps primarily for iPhone, iPad and Apple Watch with over six million downloads and awards from AARP, About.com, BestAppEver and more. Several of our Apps have consistently been ranked in the Top Ten in their categories, including #1 iPad Medical app.

 

Our Apps are available for download through the Apple App Store.

 

iOS Apps and Games

 

Our iPhone iOS portfolio includes 97 Apps, primarily consisting of ring tones. Our apps also include talking video greeting cards, games, Autism Speaking Soundboards and more.

 

Our iPad iOS portfolio includes 90 Apps, primarily consisting of ring tones. Our apps also include games, Autism Speaking Soundboards, iFAQs and more.

 

We currently have 1 apple TV App, Name That Candidate.

 

Our Mac Apps portfolio includes 2 ring tone Apps and 1 game.

 

Results of Operations

 

Three Months Ended May 31, 2021 Compared to May 31, 2020

 

Our operating results for the three months ended May 31, 2021 and May 31, 2020, and the changes between those periods for the respective items are summarized as follows:

 

 

 

Three Months

 

 

Three Months

 

 

 

 

 

 

 

 

 

Ended

 

 

Ended

 

 

 

 

 

 

 

 

 

May 31,

 

 

May 31,

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

Changes $

 

 

Change %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$ -

 

 

$ -

 

 

$ -

 

 

 

0 %

Operating Expenses

 

$ 7,730

 

 

$ 7,492

 

 

$ 238

 

 

 

3 %

Other Expenses

 

$ 5,664

 

 

$ 8,626

 

 

$ (2,962 )

 

 

-34 %

Net loss

 

$ (13,394 )

 

$ (16,118 )

 

$ 2,724

 

 

 

-17 %

 

 
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During the three months ended May 31, 2021 and May 31, 2020, we incurred total net loss of $13,394 and $16,118, respectively.

 

We had no sales for the three months ended May 31, 2021 and May 31, 2020.

 

Operating expenses were $7,730 for the three months ended May 31, 2021, compared to $7,492 for the three months ended May 31, 2020.

 

Other expenses incurred during the three months ended May 31, 2021 were $5,664, compared to $8,626 for the three months ended May 31, 2020 due to note discount amortization of $4,230 incurred during the three months ended May 31, 2020.

 

Nine Months Ended May 31, 2021 Compared to May 31, 2020

 

We had no sales for the nine months ended May 31, 2021 and May 31, 2020.

 

Our operating results for the nine months ended May 31, 2021 and May 31, 2020, and the changes between those periods for the respective items are summarized as follows:

 

 

 

Nine Months

 

 

Nine Months

 

 

 

 

 

 

 

 

 

Ended

 

 

Ended

 

 

 

 

 

 

 

 

 

May 31,

 

 

May 31,

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

Changes $

 

 

Change %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$ -

 

 

$ 794

 

 

$ (794 )

 

 

-100 %

Operating Expenses

 

$ 29,158

 

 

$ 30,665

 

 

$ (1,507 )

 

 

-5 %

Other Expenses

 

$ 24,903

 

 

$ 81,788

 

 

$ (56,885 )

 

 

-70 %

Net loss

 

$ (54,061 )

 

$ (111,659 )

 

$ 57,598

 

 

 

-52 %

 

During the nine months ended May 31, 2021 and May 31, 2020, we incurred total net loss of $54,061 and $111,659, respectively.

 

We had no sales for the nine months ended May 31, 2021 as compared to $794 revenue from mobile application sales during the nine months ended May 31, 2020.

 

Operating expenses were $29,158 for the nine months ended May 31, 2021, compared to $30,665 for the nine months ended May 31 2020.

 

Other expenses incurred during the nine months ended May 31, 2021 were $24,903, compared to $81,788 for the nine months ended May 31, 2020 due to the decrease in note discount amortization of $8,574 incurred during the nine months ended May 31, 2021 from $73,043 incurred during the nine months ended May 31, 2020

 

Liquidity and Capital Resources

 

Working Capital

 

 

 

As of

 

 

As of

 

 

 

 

 

 

 

 

 

May 31,

 

 

August 31,

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

Changes $

 

 

Change %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Assets

 

$ -

 

 

$ -

 

 

$ -

 

 

 

-

 

Current Liabilities

 

$ 151,086

 

 

$ 105,599

 

 

$ 45,487

 

 

 

43 %

Working Capital (Deficiency)

 

$ (151,086 )

 

$ (105,599 )

 

$ (45,487 )

 

 

43 %

 

 
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As of May 31 2021, we had a working capital deficit of $151,086 compared to a working capital deficit of $105,599 as of August 31, 2020. The increase in working capital deficiency was mainly due to the increase in convertible notes issued for payment made for operation expense on behalf of the Company, accrued interest from the convertible notes and advancement made from the Director for operation expenses on behalf of the Company.

 

Cash Flows

 

 

 

Nine Months

 

 

Nine Months

 

 

 

 

 

 

 

 

 

Ended

 

 

Ended

 

 

 

 

 

 

 

 

 

May 31,

 

 

May 31,

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

Changes

 

 

Change %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in operating activities

 

$ (27,458 )

 

$ (25,861 )

 

$ (1,597 )

 

 

6 %

Net cash provided by financing activities

 

$ 27,458

 

 

$ 26,803

 

 

$ 655

 

 

 

2 %

Net increase(decrease) in cash and cash equivalents

 

$ -

 

 

$ 942

 

 

$ (942 )

 

 

-100 %

 

Cash Flow from Operating Activities

 

During the nine months ended May 31, 2021, net cash used in operating activities was $27,458, related to our net loss of $54,061, decreased by note discount amortization of $8,574 and net changes in operating assets and liabilities of $18,029.

 

During the nine months ended May 31, 2020, net cash used in operating activities was $25,861, related to our net loss of $111,659, decreased by note discount amortization of $73,043 and net changes in operating assets and liabilities of $12,755.

 

Cash Flow from Investing Activities

 

During the nine months ended May 31, 2021 and May 31, 2020, we had no investing activities.

 

Cash Flow from Financing Activities

 

During the nine months ended May 31, 2021 and May 31, 2020, net cash provided by financing activities was $27,458 and $26,803, respectively.

 

Net cash provided by financing activities of $27,458 during the nine months ended May 31, 2021 consists of advancement from the Director of $18,884 and proceeds from issuance of convertible note of $8,574.

 

During the nine months ended May 31, 2020, the Company received advancement from the Director of $26,803.

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

 

 
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Table of Contents

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.

 

Item 4. Controls and Procedures

 

Disclosure Controls and Procedures

 

Our management, with the participation of our Chief Executive Officer (our principal executive officer, principal financial officer and principal accounting officer), has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a- 15(e) and 15d- 15(e) under the Securities Exchange Act of 1934, as amended (Exchange Act)), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, our Chief Executive Officer has concluded that as of such date, our disclosure controls and procedures were not effective such that the information relating to us required to be disclosed in our Securities and Exchange Commission (“SEC”) reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

 

Changes in Internal Control Over Financial Reporting

 

During the period covered by this report there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 
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Table of Contents

 

PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings

 

From time to time, we may become involved in litigation relating to claims arising out of its operations in the normal course of business. We are not involved in any pending legal proceeding or litigation and, to the best of our knowledge, no governmental authority is contemplating any proceeding to which we area party or to which any of our properties is subject, which would reasonably be likely to have a material adverse effect on us.

 

Item 1A. Risk Factors

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

None.

 

Item 3. Defaults Upon Senior Securities

 

None.

 

Item 4. Mine Safety Disclosures

 

Not Applicable.

 

Item 5. Other Information

 

None

 

 
16

Table of Contents

 

Item 6. Exhibits

 

Exhibit

Number

 

Description

(31)

 

Rule 13a-14 (d)/15d-14d) Certifications

31.1*

 

Section 302 Certification by the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer

(32)

 

Section 1350 Certifications

32.1*

 

Section 906 Certification by the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer

101*

 

Interactive Data File

101.INS

 

XBRL Instance Document

101.SCH

 

XBRL Taxonomy Extension Schema Document

101.CAL

 

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

 

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

 

XBRL Taxonomy Extension Label Linkbase Document

101.PRE

 

XBRL Taxonomy Extension Presentation Linkbase Document

____________

* Filed herewith.

 

 

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Table of Contents

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

NANOVATION MICROTECH, INC.

(Registrant)

 

Dated: July 8, 2021

 

/s/ Xie Qi Kang

 

Xie Qi Kang

 

President, Chief Executive Officer,

Secretary, Treasurer and Director

 

(Principal Executive Officer, Principal Financial

Officer and Principal Accounting Officer)

 

 
18

 

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