Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion should be read in conjunction with our consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q. Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other developments. Forward-looking statements are based upon estimates, forecasts, and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward-looking statements made by us, or on our behalf. We disclaim any obligation to update forward-looking statements.
OVERVIEW
We were incorporated under the name Greenwind NRG Inc. in the State of Nevada on February 25, 2010. We are a development-stage company and we have no revenues and no assets. As a result we have incurred losses since inception. Our limited operations to date have consisted of the formation of the Company, the raising of capital, maintaining our public company reporting requirements. On March 14, 2013, a registration statement on Form S-1 was declared effective for the registration of 10,000,000 shares of our common stock. As of October 31, 2013, we had sold 2,900,000 shares pursuant to this registration statement and the offering has been completed.
Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for the next twelve months. This is because we have not generated any revenues and no revenues are anticipated until we implement our business plan.
As a result of the current difficult economic environment and our lack of funding to implement our business plan, our Board of Directors has begun to analyze strategic alternatives available to our Company to continue as a going concern. Such alternatives include raising additional debt or equity financing or consummating a merger or acquisition with a partner that may involve a change in our business plan.
Although our Board of Directors' preference would be to obtain additional funding to implement our business plan, the Board believes that it must consider all viable strategic alternatives that are in the best interests of our shareholders. Such strategic alternatives include a merger, acquisition, share exchange, asset purchase, or similar transaction in which our present management will no longer be in control of our Company and our business operations will be replaced by that of our transaction partner. We believe we would be an attractive candidate for such a business combination due to the perceived benefits of being a publicly registered company, thereby providing a transaction partner access to the public marketplace to raise capital.
PLAN OF OPERATION
In order to begin executing on our business plan, we must raise $100,000 in equity financing through a private placement in the current year. We intend to concentrate the majority of our efforts on raising capital during this period.
The table below sets forth the use of proceeds assuming that 100% of the securities offered for sale in the equity financing are sold. Management believes these costs will cover the necessary expenses for the Company to continue to develop our operations to the point that we may begin delivering services.
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Gross Proceeds
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$
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100,000.00
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Offering Expense
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$
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20,000.00
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Net Proceeds
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$
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100,000.00
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Net Proceeds to be used
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Inventory
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$
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40,000.00
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Website development
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$
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5,000.00
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Marketing and Advertising
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$
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20,000.00
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Audit, Accounting and filing Fees
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$
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10,000.00
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Working Capital
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$
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17,217.00
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|
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Repayment of accounts payable and accrued liabilities
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$
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7,783.00
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______________
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*
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Note the offering expense will be paid through the sale of equity or debt, and not with the proceeds, if any, raised from this offering.
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If we complete the financing, our specific business plan for the next 8 months is as follows:
Develop our Website
We will procure a web designer to complete a corporate website and credit card payment processing services.
Initial Marketing Campaign
Once our website is fully operational, we intend to market our products aggressively through web, print and other mediums.
Web Marketing: Search Engine Optimization services will be used to assure that we are found using key words associated with "wind energy", "Ireland", "off the grid" and more. We intend to make our website a marketing piece in itself with maps showing wind speed locations in Ireland and the UK as well as other information on the benefits of wind energy products.
Print Media Advertising: We intend to market our products in magazines and other print media that target an environmentally conscious consumer base.
We intend to spend up to $20,000 on marketing efforts. The marketing budget is not a set cost but will be based on the amount raised in the financing.
RESULTS OF OPERATIONS
For the period from February 25, 2010 (date of inception) to July 31, 2016, the Company did not earn any revenues.
Comparison of Three Months Ended July 31, 2016 and 2015
During the three months ended July 31, 2016, the Company incurred $4,000 of operating expenses compared with $4,400 of operating expenses during the three months ended July 31, 2015. The decrease in operating expenses was attributed to a decrease in general and administrative costs.
The Company incurred a net loss of $4,000 or $0 per share, for the three months ended July 31, 2016 compared with a net loss of $4,400 or $0 per share, for the three months ended July 31, 2015.
Comparison of Nine Months Ended July 31, 2016 and 2015
During the nine months ended July 31, 2016 the Company incurred $21,333 of operating expenses compared with $19,962 of operating expenses during the nine months ended July 31, 2015. The increase in operating expenses was attributed to a increase in professional fees incurred, including legal fees relating and an increase in general and administrative costs.
The Company incurred a net loss of $21,333 or $0 per share, for the nine months ended July 31, 2016 compared with a net loss of $19,962 or $0 per share, for the nine months ended July 31, 2015.
LIQUIDITY AND CAPITAL RESOURCES
As of July 31, 2016 and October 31, 2015, the Company had cash of $0 and total assets of $0.
As of July 31, 2016, the Company had total liabilities of $104,638 compared with total liabilities of $83,305 as of October 31, 2015. The increase in total liabilities is due to an increase in accounts payable and accrued liabilities as the Company had limited cash flows to repay outstanding obligations as they became due.
On March 14, 2013, a Registration Statement on Form S-1 was declared effective by the SEC, registering a total of 10,000,000 shares of our common stock (the "Registered Shares") in an initial public offering (the "Offering"). As of October 31, 2013, the Company issued 2,900,000 Registered Shares for a total of $29,000 in proceeds and the Offering has been completed.
In order to execute on our business strategy, we will require additional working capital commensurate with the operational needs of our planned marketing and development efforts. Accordingly, we expect to use debt and/or equity financing to fund operations for the foreseeable future.
We anticipate that we will incur the following expenses over the next twelve months:
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1.
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$25,000 in connection with the development of our website and marketing efforts; and
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2.
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$10,000 in operating expenses, including professional legal and accounting expenses associated with our company being a reporting issuer under the Securities Exchange Act of 1934.
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We require a minimum of approximately $35,000 to proceed with our plan of operation over the next twelve months. As we had cash and working capital in the amount of $0 as of July 31, 2016, we do not have sufficient working capital to enable us to carry out our stated plan of operation for the next twelve months. We plan to complete private placement sales of our common stock in order to raise the funds necessary to pursue our plan of operation and to fund our working capital deficit in order to enable us to pay our accounts payable and accrued liabilities. We currently do not have any arrangements in place for the completion of any private placement financings, and there is no assurance that we will be successful in completing any private placement financings.
Any future sale of additional equity and debt securities will result in dilution to current stockholders. We may also seek additional loans where the incurrence of indebtedness would result in increased debt service obligations and could require the Company to agree to operating and financial covenants that would restrict our operations. Financing may not be available in amounts or on terms acceptable to us, if at all. Any failure by us to raise additional funds on terms favorable to us, or at all, could limit our ability to expand business operations and could harm our overall business prospects.
Cash Flows from Operating Activities
During the nine months ended July 31, 2016, the Company used $18,432 of cash for operating activities compared with $28,657 for the nine months ended July 31, 2015. The decrease in the cash used for operating activities was attributed to the fact that the Company paid less accounts payables that were coming due for outstanding operating activities.
Cash Flows from Financing Activities
During the nine months ended July 31, 2016, the Company received $18,432 from financing activities compared with $28,657 for the nine months ended July 31, 2015. The proceeds received from financing activities were financings provided by management to support the Company's day-to-day activities.
OFF-BALANCE SHEET ARRANGEMENTS
We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our stockholders.
CRITICAL ACCOUNTING POLICIES
Our financial statements are affected by the accounting policies used and the estimates and assumptions made by management during their preparation. A complete listing of these policies is included in Note 2 of the notes to our financial statements for the nine months ended July 31, 2016. We have identified below the accounting policies that are of particular importance in the presentation of our financial position, results of operations and cash flows, and which require the application of significant judgment by management.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Loss Per Common Share
Basic loss per share is calculated using the weighted-average number of common shares outstanding during each reporting period. Diluted loss per share includes potentially dilutive securities such as outstanding options and warrants, using various methods such as the treasury stock or modified treasury stock method in the determination of dilutive shares outstanding during each reporting period. The Company does not have any potentially dilutive instruments.
Stock-Based Compensation
Stock-based compensation is accounted for at fair value in accordance with ASC 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.
As of July 31, 2016, the Company has not issued any stock-based payments to its employees.
Recent Accounting Pronouncements
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
Critical Accounting Estimates
The preparation of financial statements in conformity with U.S. 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 reporting period. The Company regularly evaluates estimates and assumptions related to the deferred income tax asset valuation allowances. 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.
We have irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Jumpstart Our Business Startups Act.