Notes
to the Financial Statements
November
30, 2016
(Unaudited)
NOTE
1 - NATURE OF OPERATIONS
BEMAX
INC. (“The Company”) was incorporated in the State of Nevada on November 28, 2012 to engage in the business of exporting
disposable baby diapers manufactured in the United States and then distributing them throughout Europe and South Africa. The Company
is in the development stage with limited revenues and very limited operating history.
NOTE
2 - GOING CONCERN
These
financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets
and discharge its liabilities in the normal course of business one year from May 31, 2016. The Company has incurred a loss since
inception resulting in an accumulated deficit of $357,251 as of November 30, 2016 and further losses are anticipated in the development
of its business raising substantial doubt about the Company’s ability to continue as a going concern. The ability to continue
as a going concern is dependent upon the Company generating profitable operations in the future and/or the existing cash on hand,
loans from directors and/or private placement of common stock. Obtaining the necessary financing to meet its obligations and repay
its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over
the next twelve months with personal cash, outside loans, or equity issuances. There is no guarantee that the Company will be
able to raise any capital through any type of offering.
NOTE
3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis
of Presentation
The
Company’s unaudited condensed financial statements have been prepared in accordance with accounting principles generally
accepted in the United States of America (“U.S. GAAP”). The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ
from those estimates. The accompanying unaudited condensed financial statements reflect all adjustments, consisting of only normal
recurring items, which, in the opinion of management, are necessary for a fair statement of the results of operations for the
periods shown and are not necessarily indicative of the results to be expected for the full year ending May 31, 2017. These unaudited
condensed financial statements should be read in conjunction with the financial statements and related notes included in the Company’s
Annual Report on Form 10-K/A for the year ended May 31, 2016.
Use
of Estimates and Assumptions
The
preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could
differ from those estimates.
Fair
Value of Financial Instrument
The
Company’s financial instruments consisted of cash, accounts payable, related party advances and convertible notes. Unless
otherwise noted, it is management’s opinion the Company is not exposed to significant interest, currency or credit risks
arising from these financial instruments. Because of the short maturity of such assets and liabilities the fair value of these
financial instruments approximate their carrying values, unless otherwise noted.
Derivative
Financial Instruments
Derivative
liabilities are recognized in the balance sheets at fair value based on the criteria specified in Financial Accounting Standards
Board (
“FASB”
) Accounting Standards Codification (
“ASC”
) Topic 815-15
– Derivatives
and Hedging – Embedded Derivatives
(
“ASC 815-15”
). Pursuant to ASC Topic 815-15 an evaluation of
the embedded conversion feature of convertible debt is evaluated to determine if the bifurcated debt conversion feature is required
to be classified as a derivative liability. Since the terms of the embedded conversion features of the Company’s convertible
debt provides for the issuance of shares of common stock at the election of the holders and the number of shares is subject to
adjustment for a decline in the price of the Company’s common stock, the Company determined that the embedded conversion
option met the criteria of a derivative liability. The estimated fair value of the embedded conversion feature of debt classified
as derivative liabilities are determined using the Black-Scholes option pricing model. The model utilizes Level 3 unobservable
inputs to calculate the fair value of the derivative liabilities at each reporting period. The Company determined that using an
alternative valuation model such as a Binomial-Lattice model would result in minimal differences. The fair value of the embedded
conversion feature of debt classified as derivative liabilities are adjusted for changes in fair value at each reporting period,
and the corresponding non-cash gain or loss is recorded as other income or expense in the statement of operations. As of November
30, 2016, the embedded conversion feature of $410,269 of convertible notes payable was classified as a derivative liability. Each
reporting period the embedded conversion feature is re-valued and adjusted through the caption “change in fair value of
derivative liabilities” on the statements of operations.
Fair
value of financial instruments
The
Company follows Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 825-10-50-10,
Financial
Instruments—Overall—Disclosure,
for disclosures about fair value of our financial instruments and ASC 820-10-35-37,
Fair Value Measurement—Overall—Subsequent Measure—Fair Value Hierarchy,
to measure the fair value of
our financial instruments. ASC 820-10-35-37 establishes a framework for measuring fair value GAAP and expands disclosures about
fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820-10-35-37
establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad
levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets
or liabilities and the lowest priority to unobservable inputs. The three levels of fair value hierarchy defined by ASC 820-10-35-37
are described below:
Level
1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
Level
2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable
as of the reporting date.
Level
3: Pricing inputs that are generally observable inputs and not corroborated by market data.
Revenue
Recognition
The
Company’s revenue recognition policy is on a sales-basis method. The Company recognizes and records revenue at the time
of sale once payment has been received and disposable baby diapers are delivered to the buyer.
Pre-payment
Policy: All sales to our customers will be solely on a pre-payment basis. Once the order is completed and payment is received,
we will place an order with the North American supplier of disposable baby diapers and arrange shipping directly to our customers.
The process is expected to take three weeks to complete. The pre-payment will be recorded as deferred revenue until the delivery
is executed.
Recent
Accounting Pronouncements
The
Company does not expect the adoption of recently issued accounting pronouncements to have any significant impact on the Company’s
results of operations, financial position or cash flow. As new accounting pronouncements are issued, the Company will adopt those
that are applicable under the circumstances.
NOTE
4 - RELATED PARTY TRANSACTIONS
The
President of the Company provides management fees and office premises to the Company for a fee of $1,500 per month, the right
to which the President has agreed to assign to the Company until such a time as the Company closes on an Equity or Debt financing
of not less than $750,000. The assigned rights are valued at $1,000 per month for rent and $500 for executive compensation. A
total of $9,000 for donated management fees was charged to Shareholder Loan for the six months ended November 30, 2016.
As
of November 30, 2016, there are loans from the majority shareholder and related party totalling $47,236. These loans were made
in order to assist in meeting general and administrative expenses. These advances are unsecured, due on demand and carry no interest
or collateral.
NOTE
5 - STOCKHOLDER’S EQUITY
On
June 5, 2015, the Company decided to increase the authorized amount of common shares that can be issued from 70,000,000 to 500,000,000
with the same par value of $0.0001 per share. The Company also declared a Fifty (50) to One (1) forward stock split effective
immediately. The 50-1 stock split has been shown retroactively.
During
fiscal year 2016, the Company issued 42,500 Common Shares at $0.0001 par value to an attorney for legal services rendered.
At
November 30, 2016, there are 500,000,000 shares of common stock at a par value of $0.0001 per share authorized and 259,196,500
issued and outstanding.
NOTE
6 - CONVERTIBLE LOANS
On
February 16, 2016, the Company issued a Convertible Promissory Note in favor of Crown Bridge Partners, LLC. The principal amount
of the loan is $40,000 (forty thousand dollars) with an original issue discount of $4,000 (four thousand dollars) and carries
an interest rate of 8% per annum. It becomes due and payable with accrued interest on February 16, 2017. Crown Bridge Partners
LLC. has the option to convert the Note plus accrued interest into common shares of the Company, after 180 days. The conversion
rate will be at a discount of 48% of the lowest price for ten days prior to the actual date of conversion. The Company has the
right to prepay any part of the loan plus accrued interest up to 90 days from the issue date, subject to a cash payment of the
principal plus 130% interest and 91 days through 180 for a cash payment of the principal plus 150% interest. The Company cannot
prepay any amount outstanding after 180 days. On July 14, 2016, the Company repaid the $40,000 of principal, $1,307 of accrued
interest and a $20,965 early payment penalty.
On
April 19, 2016, the Company issued a Convertible Promissory Note in favor of Crown Bridge Partners, LLC. The principal amount
of the loan is $30,000 (thirty thousand dollars) with an original issue discount of $3,500 (three thousand five hundred dollars)
and carries an interest rate of 8% per annum. It becomes due and payable with accrued interest on April 19, 2017. Crown Bridge
Partners L.L.C. has the option to convert the Note plus accrued interest into common shares of the Company, after 180 days. The
conversion rate will be at a discount of 48% of the lowest price for ten days prior to the actual date of conversion. The Company
has the right to prepay any part of the loan plus accrued interest up to 90 days from the issue date, subject to a cash payment
of the principal plus 130% interest and 91 days through 180 for a cash payment of the principal plus 150% interest. The Company
cannot prepay any amount outstanding after 180 days. The Company bifurcated the conversion feature and accounted for it as a derivative
liability. The Company recorded the derivative liability at its fair value of $124,890 based on the Black Scholes Merton pricing
model and a corresponding debt discount of $30,000 to be amortized utilizing the interest method of accretion over the term of
the note. On November 1, 2016, $4,004 of principal was converted into 154,000 shares of common stock. Due to the conversion within
the terms of the agreement, no gain or loss was recognized. At the time of conversion, the Company fair valued the derivative
at $91,172 resulting in a loss on the change in the fair of $52,011. As of November 30, 2016, the Company again fair valued the
derivative at $36,845 resulting in a gain on the change in the fair value for the six months of $88,045. In addition, $12,175
of the debt discount has been amortized to interest expense.
On
May 9, 2016, the Company issued a Convertible Redeemable Note in favor of Adar Bays, LLC. The principal amount of the loan is
$30,000 (thirty thousand dollars) and carries an interest rate of 8% per annum. It becomes due and payable with accrued interest
on May 9, 2017. Adar Bays, LLC. has the option to convert the Note plus accrued interest into common shares of the Company, at
any time. The conversion rate will be at a discount of 52% of the lowest price for fifteen days prior to the actual date of conversion.
The Company has the right to prepay any part of the loan plus accrued interest up to 90 days from the issue date, subject to a
cash payment of the principal plus 130% interest and 91 days through 180 for a cash payment of the principal plus 150% interest.
The Company cannot prepay any amount outstanding after 180 days. The Company recorded the derivative liability at its fair value
of $108,800 based on the Black Scholes Merton pricing model and a corresponding debt discount of $30,000 to be amortized utilizing
the interest method of accretion over the term of the note. On November 28, 2016, $3,000 of principal was converted into 229,850
shares of common stock. Due to the conversion within the terms of the agreement, no gain or loss was recognized. At the time of
conversion, the Company fair valued the derivative at $40,273 resulting in a gain on the change in the fair value of $8,331. As
of November 30, 2016, the Company again fair valued the derivative at $38,092 resulting in a gain on the change in the fair value
for the six months of $70,708. In addition, $16,841 of the debt discount has been amortized to interest expense.
On
May 9, 2016, the Company issued a Convertible Redeemable Note in favor of Eagle Equities, LLC. The principal amount of the loan
is $30,000 (thirty thousand dollars) and carries an interest rate of 8% per annum. It becomes due and payable with accrued interest
on May 9, 2017. Eagle Equities L.L.C. has the option to convert the Note plus accrued interest into common shares of the Company,
at any time. The conversion rate will be at a discount of 52% of the lowest price for fifteen days prior to the actual date of
conversion. The Company has the right to prepay any part of the loan plus accrued interest up to 90 days from the issue date,
subject to a cash payment of the principal plus 130% interest and 91 days through 180 for a cash payment of the principal plus
150% interest. The Company cannot prepay any amount outstanding after 180 days. The Company recorded the derivative liability
at its fair value of $108,800 based on the Black Scholes Merton pricing model and a corresponding debt discount of $30,000 to
be amortized utilizing the interest method of accretion over the term of the note. As of November 30, 2016, the Company fair valued
the derivative at $42,358 resulting in a gain on the change in the fair value for the six months of $66,442. In addition, $16,849
of the debt discount has been amortized to interest expense.
On
May 10, 2016, the Company issued a Convertible Promissory Note in favor of Auctus Fund, L.L.C. The principal amount of the loan
is $77,750 (seventy-seven thousand, seven hundred and fifty dollars) with an original issue discount of $6,750 (six thousand,
seven hundred and fifty dollars) and carries an interest rate of 8% per annum. It becomes due and payable with accrued interest
on May 10, 2017. Auctus Fund L.L.C. has the option to convert the Note plus accrued interest into common shares of the Company,
at any time. The conversion rate will be at a discount of 52% of the lowest price for ten days prior to the actual date of conversion.
The Company has the right to prepay any part of the loan plus accrued interest up to 90 days from the issue date, subject to a
cash payment of the principal plus 135% interest and 91 days through 120 for a cash payment of the principal plus 140% interest.
Days 121 through 150, pre-paying the principal plus accrued interest plus 145% interest and day 151 through 180 days plus interest
of 150%. The Company cannot prepay any amount outstanding after 180 days.
The
Company bifurcated the conversion feature and accounted for it as a derivative liability. The Company recorded the derivative
liability at its fair value of $261,774 based on the Black Scholes Merton pricing model and a corresponding debt discount of $77,750
to be amortized utilizing the interest method of accretion over the term of the note. As of November 30, 2016, the Company fair
valued the derivative at $99,176 resulting in a gain on the change in the fair value for the six months of $162,598. In addition,
$57,468 of the debt discount has been amortized to interest expense.
On
June 2, 2016, the Company issued a Convertible Promissory Note in favor of JSJ Investments Inc. The principal amount of the loan
is $55,000 (fifty-five thousand dollars) with an original issue discount of $3,000 (three thousand dollars) a payment of $2,000
(two thousand dollars) for the Note itself and it carries an interest rate of 8% per annum. It becomes due and payable with accrued
interest on June 2, 2017. JSJ Investments, Inc. has the option to convert the Note plus accrued interest into common shares of
the Company, at any time. The conversion rate will be at a discount of 52% of the lowest price for ten days prior to the actual
date of conversion. The Company has the right to prepay any part of the loan plus accrued interest up to 90 days from the issue
date, subject to a cash payment of the principal plus 135% interest and 91 days through 120 for a cash payment of the principal
plus 140% interest. Day 121 through 150 days, pre-paying the principal plus accrued interest plus 145% interest and day 151 through
180 days plus interest of 150%. The Company cannot prepay any amount outstanding after 180 days. The Company bifurcated the conversion
feature and accounted for it as a derivative liability. The Company recorded the derivative liability at its fair value of $167,895
based on the Black Scholes Merton pricing model and a corresponding debt discount of $55,000 to be amortized utilizing the interest
method of accretion over the term of the note. As of November 30, 2016, the Company fair valued the derivative at $71,255 resulting
in a gain on the change in the fair value for the six months of $96,640. In addition, $20,446 of the debt discount has been amortized
to interest expense.
On
June 14, 2016, the Company issued a Convertible Promissory Note in favor of Black Forest Capital LLC. The principal amount of
the loan is $80,000 (eighty thousand dollars) with an original issue discount of $8,000 (eight thousand dollars) a payment of
$2,000 (two thousand dollars) for the Note itself and it carries an interest rate of 8% per annum. It becomes due and payable
with accrued interest on June 14, 2017. Black Forest Capital, L.L.C. has the option to convert the Note plus accrued interest
into common shares of the Company, at any time. The conversion rate will be at a discount of 52% of the lowest price for ten days
prior to the actual date of conversion. The Company has the right to prepay any part of the loan plus accrued interest up to 90
days from the issue date, subject to a cash payment of the principal plus 135% interest and 91 days through 120 for a cash payment
of the principal plus 140% interest. Day 121 through 150 days, pre-paying the principal plus accrued interest plus 145% interest
and day 151 through 180 days plus interest of 150%. The Company cannot prepay any amount outstanding after 180 days. The Company
bifurcated the conversion feature and accounted for it as a derivative liability. The Company recorded the derivative liability
at its fair value of $228,110 based on the Black Scholes Merton pricing model and a corresponding debt discount of $80,000 to
be amortized utilizing the interest method of accretion over the term of the note. As of November 30, 2016, the Company fair valued
the derivative at $113,985 resulting in a gain on the change in the fair value for the six months of $114,125. In addition, $37,041
of the debt discount has been amortized to interest expense.
A
summary of outstanding convertible notes as of November 30, 2016, is as follows:
Note Holder
|
|
Issue
Date
|
|
Maturity
Date
|
|
Stated
Interest
Rate
|
|
|
Amount of
Note
|
|
|
Repayments /
Conversions
|
|
|
Principal
Balance
11/30/2016
|
|
Crown Bridge Partners, LLC (1)
|
|
2/16/2016
|
|
2/16/2017
|
|
|
8
|
%
|
|
$
|
40,000
|
|
|
$
|
(40,000
|
)
|
|
$
|
-
|
|
Crown Bridge Partners, LLC (2)
|
|
4/19/2016
|
|
4/19/2017
|
|
|
8
|
%
|
|
|
30,000
|
|
|
|
(4,004
|
)
|
|
|
25,996
|
|
Adar Bays, LLC (2)
|
|
5/9/2016
|
|
5/9/2017
|
|
|
8
|
%
|
|
|
30,000
|
|
|
|
(3,000
|
)
|
|
|
27,000
|
|
Eagle Equities, LLC
|
|
5/9/2016
|
|
5/9/2017
|
|
|
8
|
%
|
|
|
30,000
|
|
|
|
-
|
|
|
|
30,000
|
|
Auctus Fund, LLC
|
|
5/10/2016
|
|
2/10/2017
|
|
|
8
|
%
|
|
|
77,750
|
|
|
|
-
|
|
|
|
77,750
|
|
JSJ Investments Inc.
|
|
6/2/2016
|
|
2/26/2017
|
|
|
8
|
%
|
|
|
55,000
|
|
|
|
-
|
|
|
|
55,000
|
|
Black Forest Capital LLC
|
|
6/14/2016
|
|
6/14/2017
|
|
|
8
|
%
|
|
|
80,000
|
|
|
|
-
|
|
|
|
80,000
|
|
Total
|
|
|
|
|
|
|
|
|
|
$
|
342,750
|
|
|
$
|
(47,004
|
)
|
|
$
|
295,746
|
|
|
(1)
|
This
Note was repaid in full with cash on July 14, 2016.
|
|
(2)
|
Reductions
are conversions to stock.
|
A
summary of outstanding convertible notes as of November 30, 2016, is as follows:
Note Holder
|
|
Issue
Date
|
|
Maturity
Date
|
|
Stated
Interest
Rate
|
|
|
Amount of
Note
|
|
|
Debt Discount
|
|
|
Net Principal
Balance
11/30/2016
|
|
Crown Bridge Partners, LLC
|
|
4/19/2016
|
|
4/19/2017
|
|
|
8
|
%
|
|
$
|
25,946
|
|
|
$
|
(12,125
|
)
|
|
$
|
13,821
|
|
Adar Bays, LLC
|
|
5/9/2016
|
|
5/9/2017
|
|
|
8
|
%
|
|
|
27,000
|
|
|
|
(10,159
|
)
|
|
|
16,841
|
|
Eagle Equities, LLC
|
|
5/9/2016
|
|
5/9/2017
|
|
|
8
|
%
|
|
|
30,000
|
|
|
|
(13,151
|
)
|
|
|
16,849
|
|
Auctus Fund, LLC
|
|
5/10/2016
|
|
2/10/2017
|
|
|
8
|
%
|
|
|
77,750
|
|
|
|
(20,282
|
)
|
|
|
57,468
|
|
JSJ Investments Inc.
|
|
6/2/2016
|
|
2/26/2017
|
|
|
8
|
%
|
|
|
55,000
|
|
|
|
(34,554
|
)
|
|
|
20,446
|
|
Black Forest Capital LLC
|
|
6/14/2016
|
|
6/14/2017
|
|
|
8
|
%
|
|
|
80,000
|
|
|
|
(42,959
|
)
|
|
|
37,041
|
|
Total
|
|
|
|
|
|
|
|
|
|
$
|
295,696
|
|
|
$
|
(133,230
|
)
|
|
$
|
162,466
|
|
|
(1)
|
This
Note was repaid in full on July 14, 2016.
|
A
summary of the activity of the derivative liability for the notes above is as follows:
Balance at May 31, 2016
|
|
$
|
351,041
|
|
Increase to derivative due to new issuances
|
|
|
396,005
|
|
Change due to debt settlement
|
|
|
32,623
|
|
Derivative loss due to mark to market adjustment
|
|
|
(377,959
|
)
|
Balance at November 30, 2016
|
|
$
|
401,710
|
|
On
November 1, 2016, Crown Bridge Partners, LLC converted $4,004 of principal into 154,000 shares of common stock at $0.026 per share.
The balance of the loan at November 30, 2016 is $25,996.
On
November 22, 2016, Adar Bays LLC converted $3,000 of principal into 250,000 shares of common stock at $0.01305 per share. The
balance of the loan at November 30, 2016 is $27,000.
NOTE
7 – RESTATEMENT
The
May 31, 2016 financial statements were restated to record inventory for purchases previously recorded on a cash basis, eliminate
accounts receivable, accounts payable and deferred revenue recorded due to accounting errors; and to account for the embedded
conversion feature related to convertible loans.
The
following table summarizes changes made to the May 31, 2016 balance sheet.
|
|
May 31, 2016
|
|
Balance Sheet:
|
|
As Reported
|
|
|
Adjustment
|
|
|
As Restated
|
|
Accounts receivable
|
|
$
|
372,622
|
|
|
$
|
(372,622
|
)
|
|
$
|
-
|
|
Inventory
|
|
$
|
-
|
|
|
$
|
189,823
|
|
|
$
|
189,823
|
|
Total Current Assets
|
|
$
|
488,360
|
|
|
$
|
(182,799
|
)
|
|
$
|
305,561
|
|
Total Assets
|
|
$
|
488,860
|
|
|
$
|
(182,799
|
)
|
|
$
|
306,061
|
|
Accounts payable
|
|
$
|
319,795
|
|
|
$
|
(319,795
|
)
|
|
$
|
-
|
|
Derivative liability
|
|
$
|
-
|
|
|
$
|
351,041
|
|
|
$
|
351,041
|
|
Debt discount
|
|
$
|
-
|
|
|
$
|
(134,148
|
)
|
|
$
|
(134,148
|
)
|
Deferred revenue
|
|
$
|
507,722
|
|
|
$
|
(507,722
|
)
|
|
$
|
-
|
|
Total current liabilities
|
|
$
|
1,075,348
|
|
|
$
|
(610,624
|
)
|
|
$
|
464,724
|
|
Total liabilities
|
|
$
|
1,075,348
|
|
|
$
|
(610,624
|
)
|
|
$
|
464,724
|
|
Accumulated deficit
|
|
$
|
(649,241
|
)
|
|
$
|
427,823
|
|
|
$
|
(221,418
|
)
|
As
a result of the errors related to inventory and recording prior sales and cost of goods sold, the financial statements for the
six months ended November 30, 2015 were restated to reflect these changes.
The
balance sheets as of November 30, 2016 and statements of operations and cash flows for the six months then ended were restated
as well with the following changes.
|
|
November 30, 2016
|
|
Balance Sheet:
|
|
As Reported
|
|
|
Adjustment
|
|
|
As Restated
|
|
Inventory
|
|
$
|
-
|
|
|
$
|
321,828
|
|
|
$
|
321,828
|
|
Derivative liability
|
|
$
|
-
|
|
|
$
|
401,710
|
|
|
$
|
401,710
|
|
Debt discount
|
|
$
|
-
|
|
|
$
|
(133,280
|
)
|
|
$
|
(133,280
|
)
|
Convertible loans
|
|
$
|
298,746
|
|
|
$
|
(3,000
|
)
|
|
$
|
295,746
|
|
Accrued interest
|
|
$
|
9,599
|
|
|
$
|
3,264
|
|
|
$
|
12,863
|
|
Common stock
|
|
$
|
25,919
|
|
|
$
|
1
|
|
|
$
|
25,920
|
|
Additional paid in capital
|
|
$
|
44,102
|
|
|
$
|
(264
|
)
|
|
$
|
43,838
|
|
Accumulated deficit
|
|
$
|
(411,373
|
)
|
|
$
|
54,122
|
|
|
$
|
(357,251
|
)
|
Statement of Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods sold
|
|
$
|
122,182
|
|
|
$
|
(6,005
|
)
|
|
$
|
116,177
|
|
Non-operating expenses
|
|
$
|
(60,290
|
)
|
|
$
|
(51,536
|
)
|
|
$
|
(111,826
|
)
|
Net loss
|
|
$
|
(216,302
|
)
|
|
$
|
80,468
|
|
|
$
|
(135,834
|
)
|
NOTE
8 - SUBSEQUENT EVENTS
The
Company has evaluated all events and transactions that occurred after November 30, 2016 up through the date these financial statements
were available for issuance. It has been determined that the following events are material:
On
December 5, 2016, the Company entered into an initial one year consulting agreement with Adebayo Ladipo. He has been compensated
by receiving 7,500,000 shares of common stock at a par value of $0.0001 per share. At no time is he considered an employee of
the Company. He is an Independent Contractor and able to pursue other interests.
As
of January 11, 2017, the six loans outstanding including accrued interest have all been converted to common shares. There are
currently no loans outstanding. The total number of shares issued regarding these conversions totals 184,748,966.
As
of January 11, 2017, there are 500,000,000 shares authorized. 451,640,836 have been issued and are outstanding and 43,646,325
have been reserved for a new loan that is currently being negotiated. Available shares for future issue totals 4,712,839.
Refer
to amended filings for the quarters and year end subsequent to May 31, 2016 for additional subsequent activity.