Quarterly Report (10-q)

Date : 11/14/2017 @ 6:07AM
Source : Edgar (US Regulatory)
Stock : Astika Holdings, Inc. (PC) (ASKH)
Quote : 0.0065  0.0005 (8.33%) @ 1:38PM

Quarterly Report (10-q)


UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-Q


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


For the quarterly period ended September 30, 2017

OR


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


For the transition period from ___________ to ___________


Commission file number 333-182113


ASTIKA HOLDINGS, INC.

(Exact name of registrant as specified in its charter)


Florida

(State or other jurisdiction of

incorporation or organization)

 

27-4601693

(I.R.S. Employer

Identification Number)


Level 1, 725 Rosebank Road

Avondale, Auckland, 1348, New Zealand

(Address of principal executive offices)


(64) 9 929 0502

(Issuer’s telephone number, including area code)


Check whether the issuer (1) 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 requirements for the past 90 days.  Yes [X ]  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 during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes [  ]  No [X]


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  [X]

(Do not check if 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 [X]


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


Class

 

Outstanding at November 10, 2017

Common Stock, par value $.001 per share

 

25,291,838 shares









































2




ASTIKA HOLDINGS, INC.


TABLE OF CONTENTS




 

PAGE

 

 

PART I. FINANCIAL INFORMATION

4

 

 

Item 1. Financial Statements (unaudited)

4

 

 

Balance Sheets

4

 

 

Statements of Operations

5

 

 

Statements of Cash Flows

6

 

 

Notes to Unaudited Interim Financial Statements

7

 

 

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

17

 

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

17

 

 

Item 4. Controls and Procedures

17

 

 

PART II. OTHER INFORMATION

19

 

 

Item 1. Legal Proceedings

19

 

 

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

19

 

 

Item 3. Defaults Upon Senior Securities

19

 

 

Item 4. Mine Safety Disclosures

19

 

 

Item 5. Other Information

19

 

 

Item 6. Exhibits

19

 

 

SIGNATURES

20









3




PART I. FINANCIAL INFORMATION


Item 1. Financial Statements


ASTIKA HOLDINGS, INC.

BALANCE SHEETS

Unaudited



 

September 30,

2017

 

December 31,

2016

 

 

 

 

ASSETS

 

 

 

TOTAL ASSETS

$

-

 

$

-

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ DEFICIT

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

Accounts payable and accrued expenses

$

57,565

 

$

63,750

 

Loan payable and accrued interest

 

3,501

 

 

3,450

 

Due to related party

 

142,779

 

 

45,264

 

Convertible note and accrued interest

 

12,643

 

 

28,821

 

Derivative liability

 

21,771

 

 

23,347

Total Current Liabilities

$

238,259

 

$

164,632

 

 

 

 

 

 

Shareholders' Deficit

 

 

 

 

 

 

Preferred Stock:  10,000,000  shares authorized;

  par value $0.001; none issued and outstanding

 

-

 

 

-

 

Common Stock:  140,000,000 shares authorized;

  par value $0.001; 20,819,457 and 11,626,857 shares

  issued and outstanding at September 30, 2017 and

  December 31, 2016, respectively

 

20,819

 

 

11,627

 

Additional paid-in capital

 

194,547

 

 

126,916

 

Accumulated deficit

 

(453,625)

 

 

(303,175)

Total Shareholders’ Deficit

 

(238,259)

 

 

(164,632)

 

 

 

 

 

 

TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT

$

-

 

$

-













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



4




ASTIKA HOLDINGS, INC.

STATEMENTS OF OPERATIONS

Unaudited



 

Three Months

Ended

 

Three Months

Ended

 

Nine Months

Ended

 

Nine Months

Ended

 

September 30,

2017

 

September 30,

2016

 

September 30,

2017

 

September 30,

2016

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

Selling, general & administrative

$

28,865

 

$

1,350

 

$

91,330

 

$

11,501

Total Operating Expenses

 

28,865

 

 

1,350

 

 

91,330

 

 

11,501

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING LOSS

 

(28,865)

 

 

(1,350)

 

 

(91,330)

 

 

(11,501)

 

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSE)

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

(276)

 

 

(510)

 

 

(1,231)

 

 

(1,520)

 

Gain (Loss) on change in fair value of

  derivative

 

(13,158)

 

 

8,436

 

 

(57,889)

 

 

(35)

Total Other Income (Expense)

 

(13,434)

 

 

7,926

 

 

(59,120)

 

 

(1,555)

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME / (LOSS)

$

(42,299)

 

$

6,576

 

$

(150,450)

 

$

(13,056)

 

 

 

 

 

 

 

 

 

 

 

 

BASIC NET INCOME (LOSS)

  PER COMMON SHARE

$

(0.00)

 

$

0.00

 

$

(0.01)

 

$

(0.00)

 

 

 

 

 

 

 

 

 

 

 

 

DILUTED NET LOSS

  PER COMMON SHARE

$

(0.00)

 

$

(0.00)

 

$

(0.01)

 

$

(0.00)

BASIC WEIGHTED AVERAGE NUMBER

  OF COMMON SHARES OUTSTANDING

 

17,069,714

 

 

11,626,857

 

 

13,777,726

 

 

11,626,857

DILUTED WEIGHTED AVERAGE NUMBER

  OF COMMON SHARES OUTSTANDING

 

17,069,714

 

 

13,843,049

 

 

13,777,726

 

 

11,626,857















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



5




ASTIKA HOLDINGS, INC.

STATEMENTS OF CASH FLOWS

Unaudited



 

For the Nine Months Ended

 

September 30,

2017

 

September 30,

2016

 

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

Net loss

$

(150,450)

 

$

(13,056)

 

 

Adjustments to reconcile net loss to net cash used in

 

 

 

 

 

 

 

operating activities:

 

 

 

 

 

 

 

 

Loss on derivative

 

57,889

 

 

35

 

 

Changes in Operating assets & liabilities

 

 

 

 

 

 

 

 

Decrease in prepaid expenses

 

-

 

 

2,051

 

 

 

Increase in accounts payable and accrued expenses

 

92,561

 

 

10,970

 

 

 

Net Cash Used by Operating Activities

 

-

 

 

-

 

 

 

 

 

 

NET INCREASE IN CASH

 

-

 

 

-

CASH AT BEGINNING OF PERIOD

 

-

 

 

-

CASH AT END OF PERIOD

$

-

 

$

-

 

 

 

 

 

 

CASH PAID FOR:

 

 

 

 

 

 

 

 

Interest

$

-

 

$

-

 

 

 

Income taxes

 

-

 

 

-

 

 

 

 

 

 

NON-CASH INVESTING AND FINANCING ACTIVITIES

 

 

 

 

 

 

 

Extinguishment of derivative to Additional Paid In Capital

$

59,465

 

$

-

 

 

Common stock issued for convertible debt

 

17,357

 

 

-

 

 

Expense paid by related party on behalf of the company

 

97,515

 

 

19,915















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



6




ASTIKA HOLDINGS, INC.

NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS

September 30, 2017



NOTE 1 - BASIS OF PRESENTATION


The accompanying unaudited interim financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission for the presentation of interim financial information, but do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements.  The accompanying financial statements should be read in conjunction with the December 31, 2016 financial statements that were filed in our annual report on Form 10-K.  In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included.  Operating results for the three and nine month periods ended September 30, 2017 are not necessarily indicative of the results that may be expected for the year ended December 31, 2017.


NOTE 2- GOING CONCERN


The Company’s unaudited interim financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business.  The Company has an accumulated deficit and no cash flows from operating activities at September 30, 2017.  The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and allow it to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.  These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management has evaluated these factors and has determined that they raise substantial doubt about the Company’s ability to continue as a going concern.


In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plans focus is on a variety of strategic acquisitions in service, agriculture and industrial companies to compliment and grow Astika Holdings, Inc.’s business.  The Company is positioning to capture the next wave of growth companies from Asia. As the centerpieces for Astika Holdings in Asia, the focus is on rapid economic growth and increased foreign investment sector companies which management believes is poised for accelerated economic growth with national modernization. Astika’s planned focus is also on adding value through successful project development, efficient operations, and opportunistic acquisitions while maintaining a low risk profile through project diversification, astute financial management and operating in secure jurisdictions. Management’s plan to obtain such resources for the Company include (i) obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses; (ii) obtaining funding from outside sources through the sale of its debt and/or equity securities; and (iii) completing a merger with or acquisition of an existing operating company.  However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.






7




NOTE 3 - FAIR VALUE OF FINANCIAL INSTRUMENTS


ASC 820, “Fair Value Measurements” (ASC 820) and ASC 825, “Financial Instruments” (ASC 825), requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. It establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. It prioritizes the inputs into three levels that may be used to measure fair value:


Level 1 - Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.


Level 2 - Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.


Level 3 - Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.


The carrying values of cash, accounts payable, and accrued liabilities approximate fair value. Pursuant to ASC 820 and 825, the fair value of cash is determined based on "Level 1" inputs, which consist of quoted prices in active markets for identical assets. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.


The following table sets forth by level within the fair value hierarchy the Company's financial assets and liabilities that are measured at fair value on a recurring basis:


September 30, 2017:

 

 

 

 

 

 

 

 

Level 1

 

Level 2

 

Level 3

 

Total

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments

$

--

 

$

--

 

$

21,771

 

$

21,771

 

 

 

 

 

 

 

 

 

December 31, 2016:

 

 

 

 

 

 

 

 

Level 1

 

Level 2

 

Level 3

 

Total

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

Derivative financial instruments

$

--

 

$

--

 

$

23,347

 

$

23,347


NOTE 4 - CONVERTIBLE NOTE PAYABLE


During October 2014, the Company issued an 8.0% convertible debenture for $31,500 in cash.  The convertible debenture accrues interest at 8.0% per annum, is unsecured, due in one year from the date of issuance and is convertible into shares of the Company’s common stock after 180 days at the option of the holder at a rate equal to 55% of the lowest trading price of the Company’s common stock out of the last 20 trading trades including the date of conversion. At September 30, 2017, the loan is in default at a default interest rate of 24%.




8



On March 21, 2017, the Company issued 572,476 common shares in the conversion of $2,000 principal and $834 in interest due to LG Capital Funding, LLC at $0.00495 per share, as calculated per the loan agreement.


On June 8, 2017, the Company issued 603,038 common shares in the conversion of $700 principal and $328 in interest due to LG Capital Funding, LLC at $0.00171 per share, as calculated per the loan agreement.


On June 13, 2017, the Company issued 638,926 common shares in the conversion of $740 principal and $350 in interest due to LG Capital Funding, LLC at $0.00171 per share, as calculated per the loan agreement.


On June 27, 2017, the Company issued 670,334 common shares in the conversion of $1,245 principal and $598 in interest due to LG Capital Funding, LLC at $0.00275 per share, as calculated per the loan agreement.


On July 18, 2017, the Company issued 701,519 common shares in the conversion of $800 principal and $396 in interest due to LG Capital Funding, LLC at $0.00171 per share, as calculated per the loan agreement.


On July 24, 2017, the Company issued 735,903 common shares in the conversion of $810 principal and $404 in interest due to LG Capital Funding, LLC at $0.00165 per share, as calculated per the loan agreement.


On August 3, 2017, the Company issued 775,636 common shares in the conversion of $850 principal and $430 in interest due to LG Capital Funding, LLC at $0.00165 per share, as calculated per the loan agreement.


On August 18, 2017, the Company issued 812,860 common shares in the conversion of $885 principal and $456 in interest due to LG Capital Funding, LLC at $0.00165 per share, as calculated per the loan agreement.


On August 25, 2017, the Company issued 852,841 common shares in the conversion of $1,080 principal and $562 in interest due to LG Capital Funding, LLC at $0.00193 per share, as calculated per the loan agreement.


On August 31, 2017, the Company issued 897,810 common shares in the conversion of $810 principal and $424 in interest due to LG Capital Funding, LLC at $0.00138 per share, as calculated per the loan agreement.


On September 13, 2017, the Company issued 941,854 common shares in the conversion of $845 principal and $450 in interest due to LG Capital Funding, LLC at $0.00138 per share, as calculated per the loan agreement.


On September 20, 2017, the Company issued 989,403 common shares in the conversion of $885 principal and $475 in interest due to LG Capital Funding, LLC at $0.00138 per share, as calculated per the loan agreement.


The balance of the convertible debenture at September 30, 2017 and December 31, 2016 was $12,643 and $24,500, respectively.  The amount of accrued interest due at September 30, 2017 is $0, with $4,321 at December 31, 2016.




9



NOTE 5 - DERIVATIVE LIABILITY


The Company analyzed the conversion option embedded in the convertible debenture for derivative accounting consideration under ASC 815 and determined that the embedded instrument should be classified as a liability and recorded at fair value due to the variable conversion prices. The fair value of the conversion options was determined to be $52,267 as of the issuance date using a Black-Scholes option-pricing model. Upon the date of issuance of the convertible debenture, $31,500 was recorded as debt discount and $20,767 was recorded as day one loss on derivative liability.


Between March and September 2017, the holder of the convertible debenture elected to convert $11,857 in principal and $5,500 in interest due of the convertible debenture into 9,192,600 shares of the Company’s common stock. As a result, $59,465 of derivative liability was extinguished through a charge to paid-in capital.


During the nine months ended September 30, 2017, $57,889 was recorded as a loss on mark-to-market of the conversion options.


The following table summarizes the derivative liability included in the balance sheet at September 30, 2017 and December 31, 2016:


Balance, December 31, 2016

 

23,347

  Reclassification of derivative liability to paid-in capital due to conversion

 

(59,465)

  Loss on change in fair value

 

57,889

Balance, September 30, 2017

$

21,771


The Company estimated the fair value of the derivative liabilities using the Black-Scholes option pricing model and the following key assumptions during the nine months ended September 30, 2017:


Expected dividends

 

--

%

Expected term (years)

 

0.12

 

Volatility

 

273% - 617

%

Risk-free rate

 

0.74% - 0.89

%


NOTE 6 - LOAN TRANSACTION


The Company purchased a recorded music compilation from EuGene Gant for a purchase price of $5,000 pursuant to a Bill of Sale and Assignment dated June 15, 2012, an Exclusive Songwriter Agreement dated June 15, 2012, and a Promissory Note that the Company concurrently executed and delivered to him on the same date.  The Company made a payment to Mr. Gant in the amount of $1,000 on June 15, 2012 and $2,000 on October 1, 2012, and $1,000 on June 15, 2013, and the remaining $1,000 principal amount under Promissory Note bears interest at five percent (5%) per annum, and there is one remaining principal installment payment in the amount of $1,162 due.  Accrued and unpaid interest on the Promissory Note is also due in the amount of $51 for the nine-month period ended September 30, 2017, and $47 for the nine-month period ended September 30, 2016.  As of September 30, 2017 and December 31, 2016, total outstanding short-term debt is $1,401 and $1,350, respectively.  The note matured on June 15, 2013 and the loan is currently in default.


The songwriter agreement expired on June 15, 2014 and the Company did not renew.


On October 22, 2015, Artfield Investment paid $2,100 in expenses on behalf of the Company. This loan is unsecured, due on demand, and carries no interest. At September 30, 2017 and December 31, 2016, the total amount owed was $2,100 and $2,100, respectively.



10



NOTE 7 - RELATED PARTY TRANSACTIONS


The Company has entered into transactions with the related party, IQ Acquisition (NY), Ltd, owned by Mr. Richards, the CEO of the Company. IQ Acquisition (NY), Ltd, the major shareholder of the Company, has paid expenses on behalf of the Company in the amount of $97,515 during the nine months ended September 30, 2017, and $19,415 during the year ended December 31, 2016. The balance due to related party as of September 30, 2017 and December 31, 2016 was $142,779, and $45,264, respectively.  The advances are unsecured, payable on demand, and carry no interest.


The Company does not rent or own any property.  The office space is provided by an officer at no charge.


NOTE 8 - MATERIAL CONTRACTS


On June 15, 2012, the Company entered into a songwriter agreement with Eugene Gant, a songwriter, which provides for Mr. Gant’s employment as a staff writer on an exclusive basis to write musical compositions as works for hire for a period of two years from the date of the agreement. This agreement expired on June 15, 2014. The exclusive songwriter agreement with Eugene B. Settler dated June 16, 2012, provides for Mr. Settler’s employment as a staff writer on an exclusive basis to write musical compositions as works for hire for a period of five years from the date of the agreement. This agreement expires on June 16, 2017. During Mr. Gant’s and Mr. Settler’s tenure as songwriters for the Company, the copyrights on their entire work product will belong to the Company, in exchange for our assistance in exploiting and marketing these compositions and the payment of a writer’s fee to them ranging from 10% to 50% of the net amounts that we collect on these musical compositions. The Company is entitled to the royalties for a period of 50 years from the date of the creation of any work for hire pursuant to such agreements. After the expiration of such 50-year period, the copyright on a musical composition reverts to the songwriter or his heirs or assigns.


On June 4, 2015, Artfield Investment RD, Inc. was contracted to provide restructuring consulting services to the Company for $45,000. Consultation fee shall be payable $22,500 in cash at the time of signing (6/4/2015), and the remaining fee of $22,500 to be paid through unrestricted shares.  The entire $45,000 was due upon signing the agreement, and was recorded as a liability.  The shares have not been issued as of the date of this filing.


NOTE 9 - EQUITY TRANSACTIONS


The Company has authorized 10,000,000 shares of Preferred Stock and 140,000,000 shares of Common Stock at par value of $0.001.  At September 30, 2017 and December 31, 2016, the Company had 20,819,457 and 11,626,857 shares of common stock issued and outstanding, respectively.  No preferred shares have been issued.


On March 10, 2016, the Company filed an Amendment to the Articles of Incorporation breaking out the Preferred Stock into Series A, B, C, D, E, F, G, H, I, J, K, and L, with the series designation of each issuance of preferred stock set forth by the Board of Directors at the time of issuance.


On March 21, 2017, the Company issued 572,476 common shares in the conversion of $2,000 principal and $834 in interest due to LG Capital Funding, LLC at $0.00495 per share, as calculated per the loan agreement.


On June 8, 2017, the Company issued 603,038 common shares in the conversion of $700 principal and $328 in interest due to LG Capital Funding, LLC at $0.00171 per share, as calculated per the loan agreement.




11




On June 13, 2017, the Company issued 638,926 common shares in the conversion of $740 principal and $350 in interest due to LG Capital Funding, LLC at $0.00171 per share, as calculated per the loan agreement.


On June 27, 2017, the Company issued 670,334 common shares in the conversion of $1,245 principal and $598 in interest due to LG Capital Funding, LLC at $0.00275 per share, as calculated per the loan agreement.


On July 18, 2017, the Company issued 701,519 common shares in the conversion of $800 principal and $396 in interest due to LG Capital Funding, LLC at $0.00171 per share, as calculated per the loan agreement.


On July 24, 2017, the Company issued 735,903 common shares in the conversion of $810 principal and $404 in interest due to LG Capital Funding, LLC at $0.00165 per share, as calculated per the loan agreement.


On August 3, 2017, the Company issued 775,636 common shares in the conversion of $850 principal and $430 in interest due to LG Capital Funding, LLC at $0.00165 per share, as calculated per the loan agreement.


On August 18, 2017, the Company issued 812,860 common shares in the conversion of $885 principal and $456 in interest due to LG Capital Funding, LLC at $0.00165 per share, as calculated per the loan agreement.


On August 25, 2017, the Company issued 852,841 common shares in the conversion of $1,080 principal and $562 in interest due to LG Capital Funding, LLC at $0.00193 per share, as calculated per the loan agreement.


On August 31, 2017, the Company issued 897,810 common shares in the conversion of $810 principal and $424 in interest due to LG Capital Funding, LLC at $0.00138 per share, as calculated per the loan agreement.


On September 13, 2017, the Company issued 941,854 common shares in the conversion of $845 principal and $450 in interest due to LG Capital Funding, LLC at $0.00138 per share, as calculated per the loan agreement.


On September 20, 2017, the Company issued 989,403 common shares in the conversion of $885 principal and $475 in interest due to LG Capital Funding, LLC at $0.00138 per share, as calculated per the loan agreement.


NOTE 10 - SUBSEQUENT EVENTS


As per Note 7, the Company has entered into transactions with the related party, IQ Acquisition (NY), Ltd, owned by Mr. Richards, the CEO of the Company.  IQ Acquisition (NY), Ltd, the major shareholder of the Company, has paid additional expenses on behalf of the Company in the amount of $22,908 between October 1, 2017 and as of the date of the filing.  The advances are unsecured, payable on demand, and carry no interest.


On October 3, 2017, the Company issued 1,038,870 common shares in the conversion of $1,035 principal and $565 in interest due to LG Capital Funding, LLC at $0.00154 per share, as calculated per the loan agreement.



12




On October 16, 2017, the Company issued 1,090,032 common shares in the conversion of $1,080 principal and $599 in interest due to LG Capital Funding, LLC at $0.00154 per share, as calculated per the loan agreement.


On October 19, 2017, the Company issued 1,141,941 common shares in the conversion of $1,130 principal and $629 in interest due to LG Capital Funding, LLC at $0.00154 per share, as calculated per the loan agreement.


On November 6, 2017, the Company issued 1,201,538 common shares in the conversion of $1,180 principal and $670 in interest due to LG Capital Funding. LLC at $0.00154 per share, as calculated per the loan agreement.






































13




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


The following discussion and analysis should be read in conjunction with our financial statements, including the notes thereto, appearing in this report and are hereby referenced.  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 report. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report.  We believe it is important to communicate our expectations. However, our management disclaims any obligation to update any forward-looking statements whether as a result of new information, future events or otherwise.

 

These forward-looking statements are based on our management’s current expectations and beliefs and involve numerous risks and uncertainties that could cause actual results to differ materially from expectations.  You should not rely upon these forward-looking statements as predictions of future events because we cannot assure you that the events or circumstances reflected in these statements will be achieved or will occur.  You can identify a forward-looking statement by the use of the forward-terminology, including words such as “may”, “will”, “believes”, “anticipates”, “estimates”, “expects”, “continues”, “should”, “seeks”, “intends”, “plans”, and/or words of similar import, or the negative of these words and phrases or other variations of these words and phrases or comparable terminology.  These forward-looking statements relate to, among other things: our sales, results of operations and anticipated cash flows; capital expenditures; depreciation and amortization expenses; sales, general and administrative expenses; our ability to maintain and develop relationship with our existing and potential future customers; and, our ability to maintain a level of investment that is required to remain competitive.  Many factors could cause our actual results to differ materially from those projected in these forward-looking statements, including, but not limited to: variability of our revenues and financial performance; risks associated with technological changes; the acceptance of our products in the marketplace by existing and potential customers; disruption of operations or increases in expenses due to our involvement with litigation or caused by civil or political unrest or other catastrophic events; general economic conditions, government mandates; and, the continued employment of our key personnel and other risks associated with competition.


Astika Holdings, Inc., a Florida corporation, is refocusing and preparing to relaunch the Company through a variety of strategic acquisitions in the textile, service, agricultural, and industrial sectors to complement and capture the next wave of growth companies from Asia and New Zealand.  The initial planned target acquisitions from the Nantong Region in China are private companies which have been in business for over a decade with consistent track records of delivering revenue and earnings growth in the textile and service sectors. The Company also has plans for agricultural “Green Future” initiatives into the Industrial Hemp sector and New Zealand Dairy sector.  The Holdings would become the primary operations and management believes that focusing our efforts on the acquisition of textile, service, agricultural, and industrial companies would represent the greatest potential for shareholder return.  Rapid economic growth and increased foreign investment sector companies poised for accelerated growth with national modernization are the planned centerpieces for Astika Holdings in Asia and New Zealand.


Plan of Operation

 

Astika Holdings’ planned focus is on a variety of strategic acquisitions in the textile, service, agriculture and industrial sectors to compliment and capture the next wave of growth companies from Asia and New Zealand. Astika plans on adding value through successful project development, efficient operations, and opportunistic acquisitions while maintaining a low risk profile through project diversification, astute financial management and operating in secure jurisdictions.




14




Management believes there will be rapid economic growth and an increase in foreign investment sector companies poised for accelerated growth with national modernization are planned centerpieces for Astika Holdings in Asia. The planned initial acquisitions from the Nantong Region, private companies, have all been in business for over a decade and have consistent track records of delivering revenue and earnings growth.


Astika's ongoing strategy through opportunistic high growth sector planned acquisitions include the dredging sector in the Nantong region of China and the Company's agriculture 'Green Future' planned initiatives into the Industrial Hemp sector. As global demand for hemp is increasing, the Company's existing relationships with China coupled with New Zealand infrastructure for seed production and food processing along with New Zealand's temperate climate and ideal soils offers Astika a position to capture the added value and economic benefits that this opportunity presents.


Astika's entrance into the Industrial Hemp sector is in conjunction with Astika's commitment to acquisitions and development of agriculture in Asia and New Zealand with the New Zealand Dairy Sector. There are large rural areas and dairy farmers eager to work with Mark Richards, the President of Astika, to potentially acquire and grow their operating dairy farms. The food service sector is intended to benefit the future of Astika's shareholders along with the Asian, New Zealand and World Markets.


Results of Operations for the Three and Nine Months Ended September 30, 2017 Compared to the Three and Nine Months Ended September 30, 2016


Revenues . The Company’s revenues were $0 for the three-month and nine-month periods ended September 30, 2017 and September 30, 2016.


Selling, General and Administrative Expenses . Selling, general and administrative expenses for the three months ended September 30, 2017 were $28,865 as compared to $1,350 for the three months ended September 30, 2016, and $91,330 for the nine months ended September 30, 2017 as compared to $11,501 for the nine months ended September 30, 2016. General and administrative expenses increased due to the Company’s efforts to get current with its compliance obligations and additional consulting fees related to the Company’s new business plan.


Liquidity and Capital Resources


We measure our liquidity in a number of ways, including the following:


 

As of

September 30, 2017

 

As of

December 31, 2016

 

 

 

 

Cash

$

-

 

$

-

Working Capital

 

(238,259)

 

 

(164,632)

Debt (current)

 

238,259

 

 

164,632


From January 13, 2011 (inception) through September 30, 2017, we raised a total of $123,500 from the issuance of common stock and the conversion of Series A Convertible Preferred Stock into shares of common stock. We have not raised any additional capital since the completion of our public offering in fall of 2012.





15




The Company has not yet established an ongoing source of revenue sufficient to cover its operating costs and allow it to continue as a going concern.  The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern.


In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plans focus is on a variety of strategic acquisitions in service, agriculture and industrial companies to compliment and grow Astika Holdings, Inc.’s business. The Company is positioning to capture the next wave of growth companies from Asia. As the centerpieces for Astika Holdings in Asia, the focus is on rapid economic growth and increased foreign investment sector companies which management believes is poised for accelerated economic growth with national modernization. Astika’s planned focus is also on adding value through successful project development, efficient operations, and opportunistic acquisitions while maintaining a low risk profile through project diversification, astute financial management and operating in secure. to obtain such resources for the Company include (i) obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses; (ii) obtaining funding from outside sources through the sale of its debt and/or equity securities; and (iii) completing a merger with or acquisition of an existing operating company.  However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.  The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.


Impact of Inflation


We believe that the rate of inflation has had negligible effect on our operations. We believe we can absorb most, if not all, increased non-controlled operating costs by increasing sales prices, whenever deemed necessary and by operating our Company in the most efficient manner possible.


Net Cash Used in Operating Activities


We experienced zero cash flow from operating activities during the nine months ended September 30, 2017 as compared to zero cash flow from operating activities during the nine months ended September 30, 2016.


Net Cash Used in Investing Activities


The net cash used in investing activities during the nine months ended September 30, 2017 and 2016 was $0.


Net Cash Provided by Financing Activities


Net cash provided by financing activities during the nine month period ended September 30, 2017 was $0, and $0 during the nine month period ended September 30, 2016.


Availability of Additional Funds


Based on our working capital deficit as of September 30, 2017 and zero revenues, we expect to need additional equity and/or debt financing to continue our operations during the next 12 months. We expect that our current cash on hand will not fund our operations through December 2017.





16



Critical Accounting Policies and Estimates


Our unaudited interim financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of unaudited interim financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the unaudited interim financial statements and the reported amounts of revenues and expenses during the reporting periods.  Actual results could differ from these estimates. Our significant estimates and assumptions include amortization, the fair value of our stock, and the valuation allowance relating to the Company’s deferred tax assets.


Material Commitments


There were no material commitments during the nine months ended September 30, 2017, except as disclosed in note 8.


Recent Accounting Pronouncements


In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern. The amendments require management to perform interim and annual assessments of an entity’s ability to continue as a going concern and provides guidance on determining when and how to disclose going concern uncertainties in the financial statements. The standard applies to all entities and is effective for annual and interim reporting periods ending after December 15, 2016, with early adoption permitted.  The Company has evaluated the impact that this new guidance will have on its financial statements, and has included the appropriate disclosures in Note 2.


The Company has reviewed all recent accounting pronouncements and, other than shown above, has determined that it is unlikely that any will have a material impact on its financial position or results of operations.


Off Balance Sheet Arrangements


As of September 30, 2017, we had no off balance sheet arrangements.


Item 3. Quantitative and Qualitative Disclosures about Market Risk


Disclosure under this section is not required for a smaller reporting company.


Item 4. Controls and Procedures


We maintain disclosure controls and procedures that are designed to ensure that the information required to be disclosed in the reports that we file under the Securities Exchange Act of 1934 (the "Exchange Act") is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our President and Treasurer, as appropriate, to allow timely decisions regarding required disclosures.  In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can only provide reasonable assurance of achieving the desired control objectives, and in reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.




17




As required by SEC Rule 13a-15(b), we carried out an evaluation, under the supervision and with the participation of our management, including our President and Treasurer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of our third fiscal quarter covered by this report. Based on the foregoing, our President and Treasurer concluded that our disclosure controls and procedures were not effective at the reasonable assurance level at September 30, 2017.  It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.


Changes in Internal Control Over Financial Reporting


There were no changes in our internal controls over financial reporting that occurred during the period covered by this report, which were identified in connection with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.



/s/ Mark W. Richards

     Mark W. Richards

     CEO, President, CFO and Treasurer





























18




PART II OTHER INFORMATION


Item 1. Legal Proceedings


None.


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.


Item 6. Exhibits


(a) Exhibits


Exhibit No.

 

Description

 

 

 

31.1

 

302 Certification - Mark W. Richards

 

 

 

32.1

 

906 Certification - Mark W. Richards


(b) Reports of Form 8-K


None
















19




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.


ASTIKA HOLDINGS, INC.




DATE:  November 13, 2017

 

 

By: /s/  Mark W. Richards

         Mark W. Richards

         Chairman, President, Chief Executive Officer

         and Treasurer (Principal Accounting Officer

         and Authorized Officer)


































20




Astika Holdings, Inc.


Index to Exhibits



Exhibit No.

 

Description

 

 

 

31.1

 

302 Certification - Mark W. Richards

 

 

 

32.1

 

906 Certification - Mark W. Richards







































21


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