NOTES
TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
September
30, 2022
NOTE
1 – NATURE OF OPERATIONS, BASIS OF PRESENTATION AND GOING CONCERN
General
The
unaudited condensed financial statements of BlueOne Card, Inc. (“BlueOne” or the “Company”) as of September 30,
2022 and for the six months ended September 30, 2022 and 2021 should be read in conjunction with the financial statements for the years
ended March 31, 2022 and 2021, respectively. BlueOne (formerly known as Avenue South Ltd., TBSS International, Inc., or Manneking Inc.),
was incorporated on July 6, 2007 under the laws of the state of Nevada. The Company started its business as a retailer and importer of
domestic home furnishings from Hong Kong. On September 30, 2011, the Company changed its name to TBSS International, Inc., which was
engaged in gold mining and drilling and general construction. On April 26, 2019, Corporate Compliance, LLC filed a re-application for
custodianship pursuant to Nevada Revised Statutes NRS 78.347. The Eighth Judicial District Court of Clark County, Nevada granted custodianship
over TBSS International, Inc. to Corporate Compliance, LLC. On October 15, 2019, the Company changed its name to Manneking Inc., and
then to BlueCard One, Inc. on June 30, 2020.
On
October 15, 2019 and on June 30, 2020, the Company effectuated a 1-for-100 reverse stock splits (the “Reverse Splits”) of
its issued and outstanding common stock. As a result of the Reverse Splits, each one hundred shares of issued and outstanding prior to
the Reverse Splits were converted into one share of common stock (See Note 8). All share and per share numbers in the unaudited condensed
financial statements and notes below have been revised retroactively to reflect the Reverse Splits.
Risk
and Uncertainty Concerning COVID-19 Pandemic
In
March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic which continues to spread
throughout the United States and the World. We are currently monitoring the outbreak of COVID-19 and the related business and travel
restrictions and changes to behavior intended to reduce its spread. If the coronavirus continues to progress, it could have a material
negative impact on our results of operations and cash flow, in addition to the impact on its employees. We have concluded that while
it is reasonably possible that the virus could have a negative impact on the results of operations, the specific impact is not readily
determinable as of the date of these financial statements. The financial statements do not include any adjustments that might result
from the outcome of this uncertainty.
Basis
of Presentation
The
interim unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the
United States of America (“GAAP”), and include the accounts of the Company. For purposes
of comparability, certain prior period amounts have been reclassified to conform to the current period presentation. The preparation
of interim condensed financial statements requires management to make assumptions and estimates that impact the amounts reported. The
interim condensed financial statements and accompanying notes are the representations of the Company’s management, who is responsible
for their integrity and objectivity. These interim condensed financial statements, reflect all adjustments, consisting of normal recurring
accruals, necessary for a fair presentation of the Company’s results of operations, financial position and cash flows for the interim
periods ended September 30, 2022 and 2021; however, certain information and footnote disclosures normally included in our audited annual
financial statements, as included in the Company’s interim condensed financial statements, have been condensed or omitted pursuant
to such SEC rules and regulations and accounting principles applicable for interim periods. These unaudited condensed financial statements
should be read in conjunction with the financial statements and the notes thereto included in the Company’s Annual Report on Form
10-K for the year ended March 31, 2022, filed with the SEC on June 29, 2022. It is important to note that the Company’s results
of operations and cash flows for interim periods are not necessarily indicative of the results of operations and cash flows to be expected
for a full fiscal year or any other interim period.
Going
Concern
The
Company demonstrates adverse conditions that raise substantial doubt about the Company’s ability to continue as a going concern.
The Company has generated minimal revenues since its formation and has suffered operating losses since July 6, 2007 (Inception Date)
to date and allow it to continue as a going concern. The continuation of the Company as a going concern is dependent upon the continued
financial support from its shareholders, the ability of the Company to obtain necessary financing to continue operations, and the attainment
of profitable operations. The Company incurred a net loss of $546,430 for the six months ended September 30, 2022, used net cash flows
in operating activities of $190,807, and has an accumulated deficit of $1,686,243 as of September 30, 2022. These factors, among others,
raise a substantial doubt regarding the Company’s ability to continue as a going concern. If the Company is unable to obtain adequate
capital, it could be forced to cease operations. The interim condensed financial statements do not include any adjustments to reflect
the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the
Company be unable to continue as a going concern.
NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use
of Estimates
The
preparation of condensed 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 amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions
related to the valuation of its assets, accounts payable, accrued liabilities and payable to related party. The Company bases its estimates
and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances,
the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs
and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and
adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results,
future results of operations will be affected.
Cash
and Cash Equivalents
The
Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.
The Company did not have any cash equivalents as of September 30, 2022 and March 31, 2022, respectively.
Inventory
Inventory
is valued at the lower of cost or net realizable value using the first-in, first-out method. The reported net value of inventory includes
saleable prepaid debit cards that will be sold or used in future periods. The Company reserves for obsolete and slow-moving inventory.
At September 30, 2022 and March 31, 2022, there were no reserves for obsolete and slow-moving inventory.
Property
and Equipment
Property
and equipment are recorded at cost, less accumulated depreciation. The Company provides for depreciation on a straight-line basis over
the estimated useful lives of the assets which range from three to five years. Leasehold improvements are amortized over the shorter
of the lease term or the estimated useful life of the related assets when they are placed into service. The Company evaluates property
and equipment for impairment periodically to determine if changes in circumstances or the occurrence of events suggest the carrying value
of the asset or asset group may not be recoverable. Maintenance and repairs are charged to operations as incurred. Expenditures which
substantially increase the useful lives of the related assets are capitalized.
Long-lived
Assets
In
accordance with Accounting Standards Codification (“ASC”) ASC 360, “Property, Plant, and Equipment”, the
Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying
amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the
market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly
in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses
combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that
the asset will more likely than not be sold or disposed of significantly before the end of its estimated useful life. Recoverability
is assessed based on the carrying amount of the asset compared to the estimated future undiscounted cash flows expected to result from
the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss equal to the excess
of the carrying value over the assets fair market value is recognized when the carrying amount exceeds the undiscounted cash flows. The
impairment loss is recorded as an expense and a direct write-down of the asset. No impairment loss was recorded during the three months
ended September 30, 2022 and 2021, respectively.
Earnings
(Loss) Per Common Share
The
Company computes earnings (loss) per share in accordance with ASC 260, “Earnings per Share”. ASC 260 requires presentation
of both basic and diluted earnings per share (“EPS”) on the face of the income statement. The Company computes Basic EPS
by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator)
during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury
stock method and convertible note and preferred stock using the if-converted method. In computing diluted EPS, the average stock price
for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options, warrants and convertible
preferred stock. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.
SCHEDULE
OF EARNING PER SHARE
| | |
2022 | | |
2021 | | |
2022 | | |
2021 | |
| | |
For the Three Months Ended September 30, | | |
For the Six Months Ended September 30, | |
| | |
2022 | | |
2021 | | |
2022 | | |
2021 | |
| Net loss computation of basic and diluted net loss per common share: | |
| | |
| | |
| | |
| |
| Net loss attributable to common stockholders | |
$ | (142,086 | ) | |
$ | (152,336 | ) | |
$ | (546,430 | ) | |
$ | (261,118 | ) |
| | |
| | | |
| | | |
| | | |
| | |
| Basic and diluted net loss per share: | |
| | | |
| | | |
| | | |
| | |
| Basic and diluted net loss per common share | |
$ | (0.01 | ) | |
$ | (0.02 | ) | |
$ | (0.05 | ) | |
$ | (0.03 | ) |
| Basic and diluted weighted average common shares outstanding | |
| 10,278,861 | | |
| 9,928,162 | | |
| 10,253,916 | | |
| 9,904,614 | |
Potential
dilutive securities that are not included in the calculations of diluted net loss per share because their effect is anti-dilutive, are
as follows as of September 30, (in common equivalent shares):
SCHEDULE
OF ANTI-DILUTIVE SECURITIES OF EARNING PER SHARE
| | |
September
30, 2022 | | |
March
31, 2022 | |
| Preferred stock | |
| 292,000,000 | | |
| 292,000,000 | |
| Total anti-dilutive weighted average shares | |
| 292,000,000 | | |
| 292,000,000 | |
Leases
The
Company has operating leases for its offices. Management determines if an arrangement is a lease at inception of the contract and whether
a contract is or contains a lease by determining whether it conveys the right to control the use of the identified asset for a period
of time. If the contract provides the Company the right to substantially all of the economic benefits from the use of the identified
asset and the right to direct the use of the identified asset, the Company consider it to be, or contain, a lease.
The Company accounts for its leases under ASC 842, Leases. Under
this guidance, arrangements meeting the definition of a lease are classified as operating or financing leases and are recorded on the
condensed balance sheet as both a right of use asset and lease liability, calculated by discounting fixed lease payments over the lease
term at the rate implicit in the lease or the Company’s incremental borrowing rate which is consummate with the respective
lease term. Lease liabilities are increased by interest and reduced by payments each period, and the right of use asset is amortized
over the lease term. For operating leases, interest on the lease liability and the amortization of the right of use asset result in straight-line
rent expense over the lease term.
In calculating the right of use asset and lease liability,
the Company elects to combine lease and non-lease components as permitted under ASC 842. The Company excludes short-term leases having
initial terms of 12 months or less from the new guidance as an accounting policy election and recognizes rent expense on a straight-line
basis over the lease term.
Fair
value of Financial Instruments and Fair Value Measurements
ASC
820, “Fair Value Measurements and Disclosures”, requires an entity to maximize the use of observable inputs and minimize
the use of unobservable inputs when measuring fair value. The Company has established 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. ASC 820 prioritizes the inputs into
three levels that may be used to measure fair value:
Level
1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
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. If the asset or liability has a specified
(contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.
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
Company’s financial instruments consist principally of prepaid deposits, accrued liabilities and customer deposits. The Company
believes that the recorded values of all the financial instruments approximate their current fair values because of their nature and
respective maturity dates or durations.
Revenue
Recognition
The
Company recognizes revenues when the product is delivered to the customer, and the ownership/control is transferred. The Company’s
revenue recognition policy is based on the revenue recognition criteria established under the Financial Accounting Standards Board –
Accounting Standards Codification 606 “Revenue From Contracts With Customers” which has established a five-step process
to govern contract revenue and satisfy each element is as follows: (1) Identify the contract(s) with a customer; (2) identify the performance
obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in
the contract; and (5) recognize revenue when or as you satisfy a performance obligation. The Company records the revenue once all the
above steps are completed.
Stock-based
Compensation
The
Company accounts for equity-based transactions with non-employees under the provisions of ASC Topic No. 505-50, “Equity-Based
Payments to Non-Employees” (“ASC 505-50”). The Company has established that equity-based payment transactions with
non-employees shall be measured at the fair value of the consideration received or the fair value of the equity instruments issued, whichever
is more reliably measurable. The fair value of common stock issued for payments to nonemployees is measured at the market price on the
date of grant. The fair value of equity instruments, other than common stock, is estimated using the Black-Scholes option valuation model.
In general, we recognize the fair value of the equity instruments issued as deferred stock compensation and amortize the cost over the
term of the contract.
The
Company accounts for employee stock-based compensation in accordance with the guidance of ASC Topic 718, “Compensation—Stock
Compensation”. Under the fair value recognition provisions, stock-based compensation expense is measured at the grant date
based on the fair value of the award and is recognized ratably over the requisite service period.
Income
Taxes
The
Company accounts for income taxes using the asset and liability method in accordance with ASC 740, “Income Taxes”.
The asset and liability method provide that deferred tax assets and liabilities are recognized for the expected future tax consequences
of temporary differences between the financial reporting and tax basis of assets and liabilities, and for operating loss and tax credit
carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws. The Company records
a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.
The
Company follows the provisions of ASC 740-10, “Accounting for Uncertain Income Tax Positions.” When tax returns are
filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are
subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. In accordance
with the guidance of ASC 740-10, the benefit of a tax position is recognized in the financial statements in the period during which,
based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination,
including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions.
Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more
than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated
with tax positions taken that exceeds the amount measured as described above should be reflected as a liability for unrecognized tax
benefits in the accompanying balance sheets along with any associated interest and penalties that would be payable to the taxing authorities
upon examination.
Recent
Accounting Pronouncements
In
March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04, “Facilitation of the Effects of Reference
Rate Reform on Financial Reporting.” This ASU provides optional expedients and exceptions for applying GAAP to contracts, hedging
relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this ASU apply
only to contracts and hedging relationships that reference the London Interbank Offered Rate (“LIBOR”) or another reference
rate expected to be discontinued due to reference rate reform. The expedients and exceptions provided by the amendments do not apply
to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022. The Company does not expect
the adoption of ASU 2019-12 to have a material impact on its financial statements.
NOTE
3 – PREPAID DEPOSITS
Prepaid
deposits consisted of the following:
SCHEDULE OF PREPAID DEPOSITS
| | |
September 30, 2022 | | |
March
31, 2022 | |
| | |
| | |
| |
| Prepaid rent | |
$ | 6,759 | | |
$ | 6,759 | |
| Prepaid cards inventory | |
| 77,900 | | |
| 77,900 | |
| Prepaid Business Identification Number | |
| 209,547 | | |
| 180,847 | |
| Other | |
| - | | |
| 5,000 | |
| Total | |
$ | 294,206 | | |
$ | 270,506 | |
NOTE
4 – PROPERTY AND EQUIPMENT
Property
and equipment, stated at cost, consisted of the following:
SCHEDULE OF PROPERTY AND EQUIPMENT
| | |
Estimated Life | |
September 30, 2022 | | |
March
31, 2022 | |
| | |
| |
| | |
| |
| Furniture and Fixtures | |
5 years | |
$ | 120,519 | | |
$ | 120,519 | |
| Office equipment | |
3 years | |
| 5,500 | | |
| 5,500 | |
| Vehicles | |
5 years | |
| - | | |
| 97,991 | |
| Property and equipment, gross | |
| |
| 126,019 | | |
| 224,010 | |
| Less: Accumulated depreciation | |
| |
| (65,763 | ) | |
| (88,725 | ) |
| Total | |
| |
$ | 60,256 | | |
$ | 135,285 | |
Depreciation
expense amounted to $8,117 and
$19,501 for the three months and six months ended September 30, 2022
as compared to $10,525
and
$21,050
for
the same comparable periods of 2021.
NOTE
5 – RELATED PARTY TRANSACTIONS
The
Company’s Chief Executive Officer (“CEO”), from time to time, has provided advances to the Company for its working
capital purposes. The CEO had advanced funds to the Company totaling $58,058 and $32,512 as of September 30, 2022 and March 31, 2022,
respectively. The funds advanced are unsecured, non-interest bearing, and due on demand.
On
December 1, 2020, the Company entered into an employment agreement with its CEO for a three-year term, for an annual compensation of
$150,000 with a 10% annual increase in compensation effective October 1 of each year. On December 22, 2020, the Company issued 1,000,000
shares of its common stock to its CEO, valued at $1,000 as an inducement (sign-on bonus) to enter into the employment agreement (Note
8). The Company has recorded compensation expense of $41,250 and $82,500 for the three months and six months ended September 30, 2022
as compared to $37,500 and $75,000 for the same comparable periods in 2021. Compensation payable to the CEO was $290,000 and $207,500
as of September 30, 2022 and March 31, 2022, respectively.
The
Company has recorded a total payable to the CEO of $348,058 and $240,012 as of September 30, 2022 and March 31, 2022, respectively.
NOTE
6 – LOAN PAYABLE
On
June 16, 2020, the Company entered into a financing arrangement to purchase a vehicle, and obtained a loan of $78,491,
payable over a term of 72
months, interest bearing at 3.99%,
with a monthly payment of principal and interest of $1,228.
On July 15, 2022, the Company sold the vehicle to a third party and assigned the loan payments to the third party. The Company had a
loan balance of $53,494
as of July 18, 2022 which was paid off by the purchaser of
vehicle directly to the loan holder. The net book value of vehicle after accumulated depreciation of $42,463
at July 15, 2022 was $55,528.
The Company recorded a loss on sale of vehicle of $2,034
on September 30, 2022.
SCHEDULE OF LOAN PAYABLE
| | |
September 30, 2022 | | |
March
31, 2022 | |
| | |
| | |
| |
| Loan payable | |
$ | - | | |
$ | 56,458 | |
| Less: Current portion | |
| - | | |
| (12,699 | ) |
| Loan Payable - Non-current portion | |
$ | - | | |
$ | 43,759 | |
The
Company recorded interest expense on the loan of $525 and $1,083 for the three months and six months ended September 30, 2022 as compared
to interest expense of $434 and $1,115 for the same comparable periods in 2021.
The Company uses its credit cards to make purchases in the normal course
of business. The Company recorded $1,167 and $2,033 in interest charges payable to the credit card company for the three months and six
months ended September 30, 2022. The Company recorded $0 and $43 in interest charges payable to the credit card company for the three
months and six months ended September 30, 2021.
NOTE
7 – COMMITMENTS AND CONTINGENCIES
Vehicle
On
July 12, 2022, the Company executed a non-cancellable operating lease for a vehicle with the lease commencing on July 12, 2022 for a
three-year term. The Company paid $10,000 at the execution of the lease which included $1,793 as first month payment, and $8,207 as vehicle
registration, capitalized cost reduction and other handling fees. The lease expires on July 11, 2025.
Supplemental
balance sheet information related to the lease is as follows as of September 30, 2022:
SCHEDULE OF OTHER SUPPLEMENTAL INFORMATION UNDER OPERATING LEASE
| | |
| |
| Operating Lease | |
| |
| Right-of-use asset, net | |
$ | 57,713 | |
| | |
| | |
| Current lease liabilities | |
$ | 16,376 | |
| Non-current lease liabilities | |
| 33,814 | |
| Total operating lease liabilities | |
$ | 50,190 | |
| | |
| | |
| Weighted average remaining lease term (years) | |
| 2.75 | |
| | |
| | |
| Weighted average discount rate per annum | |
| 12 | % |
As
the lease do not provide an implicit rate, the Company used an incremental borrowing rate based on the information available at the lease
commencement date in determining the present value of the lease payment, which is reflective of the specific term of the lease.
Anticipated
future costs are as follows:
SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS UNDER OPERATING LEASES
| For the years ending | |
Vehicle Lease | |
| March 31, 2023 (remaining) | |
$ | 10,759 | |
| March 31, 2024 | |
| 21,518 | |
| March 31, 2025 | |
| 21,518 | |
| March 31, 2026 | |
| 5,379 | |
| Total lease payments | |
| 59,174 | |
| Less: imputed interest | |
| (8,984 | ) |
| Present value of lease liabilities | |
$ | 50,190 | |
Office
Leases
On
August 27, 2020, the Company formally executed a month-to-month cancellable operating lease for leasing office space in an executive
suite, commencing on September 1, 2020 for $259 per month. The Company paid a security deposit of $259 on September 7, 2020. The monthly
rent increased to $279 effective January 1, 2021. The Company has recorded rent expense of $837 and $1,674 for the three months and six
months ended September 30, 2022 and $837 and $1,674 for the same comparable periods of 2021.
On
October 26, 2020, the Company executed a non-cancellable operating lease agreement for its principal office for a monthly rent of $5,500,
with the lease commencing on November 1, 2020 for a period of 12 months. The Company paid a security deposit of $5,500 on October 28,
2020. On November 25, 2021, the Company executed a month-to-month lease for this office facility at a monthly rental of $6,500. The Company
has recorded rent expense of $19,500 and $39,000 for the three months and six months ended September 30, 2022, as compared to $16,500
and $33,000 for the same comparable periods in 2021.
The
Company has recorded total rent expense of $26,400 and $46,737 for the three months and six months ended June 30, 2022 as compared to
$17,337 and $34,674 for the same comparable periods in 2021.
Legal
Costs and Contingencies
In
the normal course of business, the Company incurs costs to hire and retain external legal counsel to advise it on regulatory, litigation
and other matters. The Company expenses these costs as the related services are received.
If
a loss is considered probable and the amount can be reasonable estimated, the Company recognizes an expense for the estimated loss. If
the Company has the potential to recover a portion of the estimated loss from a third party, the Company makes a separate assessment
of recoverability and reduces the estimated loss if recovery is also deemed probable. The Company was not aware of any loss contingencies
as of September 30, 2022 and March 31, 2022, respectively.
NOTE
8 – STOCKHOLDERS’ EQUITY
The
Company’s capitalization at September 30, 2022 and March 31, 2022 was 500,000,000 authorized common shares with a par value of
$0.001 per share, and 25,000,000 authorized preferred shares with a par value of $0.001 per share.
On
October 15, 2019 and June 30, 2020, the Company effectuated reverse stock splits (the “Reverse Splits”) of its issued and
outstanding common stock. As a result of the Reverse Splits, each 100 shares of common stock issued and outstanding prior to the Reverse
Splits were converted into one (1) common stock. All share and per share numbers in these financial statements have been revised retroactively
to take into account this Reverse Split.
Common
Stock
On
April 6, 2022, the Company entered into consulting agreements with two business advisors for providing business advisory and consulting
services for a period of six months. The Company issued 250,000 shares of common stock valued at $250,000 for such services. Due to lack
of marketability and trading volume of shares, the Company agreed to offer a 50% discount on the last sale price of the common stock
at $2 per share.
From
April 20, 2022 to September 30, 2022, the Company sold 49,286 shares of common stock to seven investors for a total consideration of
$172,500. As a result, the total issued and outstanding shares of common stock were 10,278,861 shares as of September 30, 2022 and 9,979,575
shares of common stock at March 31, 2022, respectively.
Preferred
Stock
The
Board of Directors, without further approval of its stockholders, is authorized to fix the dividend rights and terms, conversion rights,
voting rights, redemption rights, liquidation preferences and other rights and restrictions relating to any series. Issuances of shares
of preferred stock, while providing flexibility in connection with possible financings, acquisitions and other corporate purposes, could,
among other things, adversely affect the voting power of the holders of our Common Stock and other series of Preferred Stock then outstanding.
Series
A Preferred Stock
There
are 1,000,000 shares of Series A Preferred Stock designated and 292,000 shares issued and outstanding as of September 30, 2022 and March
31, 2022, respectively.
Liquidation
Preference
In
the event of any liquidation, dissolution or winding up of the Company, either voluntary or involuntary, after setting apart or paying
in full the preferential amounts due to Holders of senior capital stock, if any, the Holders of Series A Preferred Stock and parity capital
stock, if any, shall be entitled to receive, prior and in preference to any distribution of any of the assets or surplus funds of the
Company to the Holders of junior capital stock, including Common Stock, an amount equal to $0.001 per share [the “Liquidation Preference”.
If upon such liquidation, dissolution or winding up of the Company, the assets of the Company available for distribution to the Holders
of the Series A Preferred Stock and parity capital stock, if any, shall be insufficient to permit in full the payment of the Liquidation
Preference, then all such assets of the Company shall be distributed ratably among the holders of the Series A Preferred Stock and parity
capital stock, if any. Neither the consolidation or merger of the Company nor the sale, lease or transfer by the Company of all or a
part of its assets shall be deemed a liquidation, dissolution or winding up of the Company for purposes of these Liquidation Rights.
Stock
Splits, Dividends and Distributions
If
the Company, at any time while any Series A Convertible Preferred Stock is outstanding, (a) shall pay a stock dividend or otherwise make
a distribution or distributions on shares of its Common Stock payable in shares of its capital stock (whether payable in shares of its
Common Stock or of capital stock of any class), (b) subdivide outstanding shares of Common Stock into a larger number of shares, (c)
combine outstanding shares of Common Stock into a smaller number of shares. Or (d) issue reclassification of shares of Common Stock for
any shares of capital stock of the Company, the conversion ratio, as defined, shall be adjusted by multiplying the number of shares of
Common Stock issuable by a fraction of which the numerator shall be the number of shares of Common Stock of the Company outstanding after
such event and of which the denominator shall be the number of shares of Common Stock outstanding before such event. Any adjustment made
pursuant to this paragraph €(iii) shall become effective immediately after the record date for the determination of stockholders entitled
to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision,
combination or reclassification.
Conversion
Rights
Each
share of Series A Preferred Stock is convertible, at the option of the holder, into 1,000 shares of Common Stock.
Voting
Rights
The
holders of shares of Series A Convertible Preferred Stock shall be entitled to vote on any and all matters considered and voted upon
by the Company’s Common Stock. The holders of the Series A Convertible Preferred Stock shall be entitled to 1,000 (one thousand)
votes per share of Common Stock.
As
a result of all preferred stock issuances, the total issued and outstanding shares of preferred stock were 292,000 shares as of September
30, 2022 and March 31, 2022, respectively.
NOTE
9 – SUBSEQUENT EVENTS
On
October 7, 2022, the Company sold 57,143 shares of common stock to an accredited investor for $200,000.