Item
2. Management’s Discussion and Analysis or Plan of Operations.
As
used in this Form 10-Q, references to “Darkstar”, “the” “Company,” “we”,
“our” or “us” refer to Darkstar, unless the context otherwise indicates.
Forward-Looking
Statements
The following discussion should be read
in conjunction with our unaudited financial statements, which are included elsewhere in this Form 10-Q (the “Report”
). This Report contains forward-looking statements which 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.
Corporate
Background and Business Overview
We
were incorporated on May 8, 2007 in the State of Nevada. We are a development stage company that was originally established to
offer eco-friendly health and wellness products to the general public via the internet. As we had previously disclosed, on November
20, 2012, we entered into a binding letter of intent (“LOI”) with Real Aesthetic, Inc., a Nevada corporation (“Real
Aesthetic”), to acquire all of the issued and outstanding shares of common stock in exchange for common stock of the Company.
The closing of the transactions contemplated by the LOI was subject to the completion of the due diligence investigation of both
parties, execution and delivery of documentation for the transaction, consents from the respective boards of directors of both
companies and any third parties and the delivery of audited financial statements by Real Aesthetic. Subsequently, we decided not
to pursue the contemplated transaction with Real Aesthetic. The Company has since abandoned its business plan.
The
Registrant has recently determined, through its recently established, wholly-owned new Israeli subsidiary, Bengio Urban Renewals
Ltd to focus its limited resources in the area of real estate development, particularly focusing on the urban renewal market in
Israel. We believe, based upon the current real estate market in Israel, that urban renewal projects present an opportunity for
us to generate revenues and profits, which we have never experienced since our inception. The basis for our belief is that
in several major Israeli cities, there is virtually no more room to grow. As a result, several municipal governments have allowed
older buildings to be renovated, thereby giving their respective cities the opportunity to develop new apartments to be added
to or replacing existing buildings.
Additionally,
municipalities have express their concern that many buildings constructed before 1980 will be unable to withstand earthquakes.
In Israel, very few apartment buildings are owned by a single person or entity and since the majority of apartments within buildings
are privately owned, the burden to renovate buildings in order to render them safer in the event of a major earthquake primarily
falls on the multiple owners of various apartment buildings and complexes.
“Tama
38” is an Israeli national zoning plan whereby a contractor assumes the responsibility of renovating an apartment building.
In exchange for covering all costs of renovations, securing building permits and paying requisite taxes, the contractor has is
granted the right to build additional floors to the existing building and sell the apartments built on these floors.
The
apartment owners benefit by receiving a modernized building, strengthened against earthquakes, as well as the additional apartments
added to their buildings. In some cases balconies, storage rooms, parking spaces and elevators may be added as well, further enhancing
the building’s value.
“PinuiBinui”
projects are defined as development where the residents of apartments are temporarily evacuated so that the buildings may be demolished
and rebuilt. The tenants then return to new apartments in the newly finished and renovated building. The contractor
pays all costs for demolition, construction, relocating apartment owners and renting their temporary homes during construction.
In exchange, the contractor adds new apartments in the building which are sold to generate profit.
As
with “Tama 38,” the value of the apartments in the building is increased thereby benefitting the owners and the tenants
return to a new, often larger and safer apartment in a building often with more amenities.
Since
February 2016, the Registrant’s Board of Directors authorized the establishment of a new wholly-owned Israeli
subsidiary, Bengio Urban Renewals Ltd (“Bengio Urban”) to focus its limited resources in the area of real estate development,
particularly focusing on the urban renewal market in Israel. To that end, the Registrant raised $150,000 from the sale of restricted
shares to investors to fund the new real estate development operations of Bengio Urban, which has recently hired employees
and has signed contracts with the current tenants of seven buildings who have agreed to vacate the buildings so that they can
be redeveloped into modern state of the art new residential buildings.
On
February 16, 2016, the Board of Directors of the Company and the holder of a majority of the issued and outstanding shares of
common stock of the Company (the “Majority Consenting Stockholder”), together, executed a joint written consent to authorize
and approve a Certificate of Amendment to the Company’s Articles of Incorporation to increase the authorized capital stock of
the Company from 505,000,000 shares (the “Capital Stock”), consisting of 500,000,000 shares of common stock, par value
$0.0001 (the “Common Stock”) and 5,000,000 shares of preferred stock, par value $0.0001 (the “Preferred Stock”),
to an authorized capital stock of the Corporation of 2,005,000,000 shares consisting of 2,000,000,000 shares of Common Stock and
five million 5,000,000 shares of Preferred Stock. It was also decided that the Board of Directors shall have the authority to
establish one or more series of Preferred Stock and fix relative rights and preferences of any series of Preferred Stock, without
any further action or approval of our stockholders.
Other
than our current director and officer, the Company currently has no employees.
On
May 10, 2019, the Company entered into a binding merger agreement with Samsara Luggage, Inc. (“Samsara”), a smart luggage
company, pursuant to which Samsara will merge with and into the Company, and the current shareholders of Samsara will be issued
new shares of the Company representing approximately 80% of the issued and outstanding shares of the Company’s common stock
following the completion of the merger.
The
closing of the merger transaction is subject, among other standard closing conditions, to the following conditions:
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(1)
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The
completion of all missing information, exhibits, and schedules to the merger agreement to the satisfaction of Samsara.
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(2)
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An
increase in the authorized share capital of the Company.
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(3)
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The
spin-off and sale of the Company’s wholly owned Israeli subsidiary, Bengio Urban Renewals Ltd., to Avraham Bengio, the current
CEO of the Company.
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(4)
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The
Company having raised at least $500,000 in financing.
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(5)
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A
Registration Statement on Form S-4 for the Company shares to be issued to the shareholders of Samsara having been declared effective
by the Securities and Exchange Commission.
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(6)
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All
required consents and approvals for the merger transaction having been obtained.
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Transfer
Agent
We
have engaged Vstock Transfer LLC, 77 Spruce Street, Suite 201, Cedarhurst, NY, 11516 as our stock transfer agent. Their telephone
number is (212) 828-8436 and their fax number is (646) 536-3179. The transfer agent is responsible for all record-keeping and
administrative functions in connection with our issued and outstanding common stock.
Results
of Operations
Results
of operations for the nine months ended April 30, 2019
The
Company did not generate any revenues from operations for the nine months ended April 30, 2019 and 2018.
During
the nine months ended April 30, 2019 and 2018 the operating expenses and the comprehensive loss was $344,992 and $274,117 respectively.
The operating expenses and comprehensive loss was primarily the result of professional fees, legal, auditing and other consulting
fees associated with SEC compliance and operating expenses in the subsidiary from its commencement of its business activities
.
We
expect to continue to incur significant operating expenses. As a result, we will need to generate significant revenues to achieve
profitability, which may not occur. Even if we do achieve profitability, we may be unable to sustain or increase profitability
on a quarterly or annual basis in the future.
Liquidity
and Capital Resources
We
had no cash balance as of April 30, 2019. The Company is currently seeking to raise additional equity thru private placements
to enable the continuation of its current TAMA 38 business plan.
Going
Concern Consideration
Our
auditors have issued an opinion on our annual financial statements which includes a statement describing our going concern status.
This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain
additional capital to pay our bills and meet our other financial obligations. This is because we have not generated any revenues
and no revenues are anticipated until we begin marketing the product which cannot be guaranteed.
Off-Balance
Sheet Arrangements
We
do not have any 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 are material to investors.